Natrol, Inc. (Nasdaq:NTOL), a leading manufacturer and marketer of
nationally branded nutritional products, today announced that it
had recorded operating income of $0.3 million and net income of
$0.1 million on net sales of $16.6 million for its second quarter
ending June 30, 2006. Net sales in the second quarter decreased
15.5% or $3.0 million compared to net sales of $19.6 million in the
second quarter of 2005. The Company recorded operating income of
$0.6 million and net income of $0.3 million for the second quarter
of 2005. The Company's gross margin increased to 43.4% for the
second quarter from 38.4% in the same quarter of 2005. The gross
margin also improved relative to the first quarter of 2006 when the
Company recorded a gross margin of 40.7% For the six months ended
June 30, 2006, the Company recorded operating income of $0.3
million and net income of $0.2 million on net sales of $33.5
million compared to an operating loss of $0.3 million and a net
loss of $0.3 million on net sales of $37.3 million for the six
months ended June 30, 2005. The Company's gross margin increased to
42.0% for the six months ended June 30, 2006 compared to 37.0% for
the six months ended June 30, 2005. "This is our second consecutive
quarter of profitability," said Wayne Bos, Natrol's President and
CEO, when making the announcement. "We have achieved profitability
by being sharply-focused on the core business. Revenue was down
during the second quarter because we did not introduce new products
to the level that we did in same quarter of 2005 when we introduced
approximately $2 million of new Natrol items. Repeat sales on these
items have not been strong. It is a testament to the Natrol brand
that our core, established products showed growth. A second
contributing factor to our decline in sales was our intentional
exit from unprofitable portions of the contract manufacturing
business. This contributed to $0.5 million of the drop in sales.
Lastly, our Prolab business remains soft, particularly outside the
US and declined $1.3 million relative to the second quarter of
2005. We believe that our UK subsidiary, which will begin selling
product during the latter part of the third quarter, will help
strengthen Prolab sales. "To compensate for the top line, we have
initiated prudent cost controls and begun many projects focused on
improving our gross margins through improved purchasing and
manufacturing efficiency. The many projects we have initiated
regarding our gross margins are producing results, allowing us to
better last year's year-to-date performance, in spite of additional
staffing at the executive level and the implementation of option
expensing rules which cost us approximately $0.4 million compared
to last year. Our positive performance year-to-date is a direct
result of our following our business strategy, the first priority
of which is to strengthen our core business." About Natrol Founded
in 1980, Natrol, Inc. (Nasdaq:NTOL) is a diversified nutrition
company that manufactures and markets premium-branded nutritional
products, functional teas and sports fitness products under the
Natrol(R), Laci Le Beau(R) and Prolab(R) Sports Nutrition brands.
Natrol markets more than 200 nutritional products designed to meet
a wide range of consumer needs. The products are available at more
than 54,000 food, drug, mass market and independent health food
stores, catalogs and Internet sites, gyms and specialty stores
nationally and in select foreign countries. For more information,
visit www.natrol.com. The statements made in this press release
which are not historical facts including statements regarding
expectations for future growth of revenue and profits and trends
concerning net sales, are forward looking statements within the
meaning of Section 27A of the Securities Act of 1933, as amended,
and Section 21E of the Securities Exchange Act of 1934, as amended.
As a result of a number of factors, our actual results could differ
materially from those set forth in the forward looking statements.
Certain factors that might cause our actual results to differ
materially from those set forth in the forward looking statements
include our ability to define and implement our business
strategies, adverse trends in the dietary supplements industry,
intense competition, adverse effects of unfavorable publicity
regarding particular products or our industry generally, our
dependence on the introduction of successful new products, our
ability to gain market share and shelf space in each of its
distribution channels, our experiencing high rates of product
returns, and adverse government regulation, as well as those
factors set forth under the heading "Risk Factors" in our Annual
Report on Form 10-K for the year ended December 31, 2005 and in our
other filings with the Securities and Exchange Commission. -0- *T
Natrol, Inc. and Subsidiaries Consolidated Balance Sheets (In
thousands, except share and per share data) June 30 December 31
2006 2005 ------------ ------------ (unaudited) Assets Current
assets: Cash $ 2,262 $ 3,097 Accounts receivable, net of allowances
of $210 and $247 at June 30, 2006 and December 31, 2005,
respectively 7,541 6,723 Inventory 12,236 11,797 Income taxes
receivable 234 439 Deferred income taxes 2,021 2,021 Prepaid
expenses and other current assets 491 726 ------------ ------------
Total current assets 24,785 24,803 ------------ ------------
Property and equipment: Building and improvements 14,936 14,930
Machinery and equipment 5,777 5,754 Furniture and office equipment
3,138 2,900 ------------ ------------ 23,851 23,584 Accumulated
depreciation and amortization (9,376) (8,684)
-------------------------- Property and equipment, net 14,475
14,900 Property held for sale, net -- 761 Restricted cash 5,000
5,000 Deferred income taxes 4,033 3,905 Goodwill, net of
accumulated amortization and impairment charge of $37,381 2,026
2,026 Other assets 53 67 ------------ ------------ Total assets $
50,372 $ 51,462 ============ ============ Liabilities and
stockholders' equity Current liabilities: Accounts payable $ 1,750
$ 4,647 Accrued expenses 4,122 2,888 Accrued payroll and related
liabilities 1,063 826 Current portion of long-term debt 548 532
------------ ------------ Total current liabilities 7,483 8,893
============ ============ Long-term debt, less current portion
6,887 7,165 Commitments and contingencies Stockholders' equity:
Preferred stock, par value of $0.01 per share: Authorized
shares--2,000,000; Issued and outstanding shares--none -- -- Common
stock, par value of $0.01 per share: Authorized shares--50,000,000
Issued and outstanding shares--13,575,648 and 13,535,837 at June
30, 2006 and December 31, 2005, respectively 136 135 Additional
paid-in capital 60,537 60,113 Accumulated deficit (24,671) (24,844)
-------------------------- Total stockholders' equity 36,002 35,404
============ ============ Total liabilities and stockholders'
equity $ 50,372 $ 51,462 ============ ============ Natrol, Inc. and
Subsidiaries Consolidated Statements of Operations (In thousands,
except share and per share data) (unaudited) Three months ended Six
months ended June 30, June 30, -----------------------
----------------------- 2006 2005 2006 2005 ----------- -----------
----------- ----------- Net sales $16,587 $19,604 $33,511 $37,273
Cost of goods sold 9,394 12,076 19,423 23,480 -----------
----------- ----------- ----------- Gross profit 7,193 7,528 14,088
13,793 ----------- ----------- ----------- ----------- Selling and
marketing expenses 4,091 4,860 8,183 9,045 General and
administrative expenses 2,765 2,086 5,290 5,003 Option expenses 67
-- 359 -- ----------- ----------- ----------- ----------- Total
operating expenses 6,923 6,946 13,832 14,048 -----------
----------- ----------- ----------- Operating income (loss) 270 582
256 (255) Interest income 60 48 116 90 Interest expense (153) (160)
(307) (320) Gain on sale of property -- -- 230 -- -----------
----------- ----------- ----------- Income (loss) before taxes 177
470 295 (485) Income tax provision (benefit) 77 179 122 (184)
----------- ----------- ----------- ------------ Net Income (loss)
$ 100 $ 291 $ 173 $ (301) =========== =========== ===========
============ Income (loss) per share: Basic $ .01 $ .02 $ .01 $
(.02) =========== =========== =========== ============ Diluted $
.01 $ .02 $ .01 $ (.02) =========== =========== ===========
============ Weighted-average shares outstanding-- basic and
diluted Basic 13,563,747 13,453,164 13,557,115 13,418,981 Diluted
13,914,763 14,178,075 13,865,531 13,418,981 *T
Natrol (NASDAQ:NTOL)
Historical Stock Chart
From Jun 2024 to Jul 2024
Natrol (NASDAQ:NTOL)
Historical Stock Chart
From Jul 2023 to Jul 2024