Tarang Amin, president and chief executive officer, stated: “Our results for the first quarter were strong with revenue increasing 13% over the first quarter of last year. Our branded business increased 25% and reflects growth across all key brands and the contribution from the recently acquired probiotics business. We continue to focus on five key growth strategies: building premium brands; leading innovation; expanding the channel and geographic footprint of the company; pursuing acquisitions; and driving world-class operations.”
Fiscal First Quarter 2012 Results
For the fiscal 2012 first quarter, Schiff Nutrition’s net sales were $58.2 million, compared to $51.4 million for the same period in fiscal 2011. The 13% increase reflects growth in all key brands and includes a full quarter of results from the recently acquired probiotics business. Branded sales results were partially offset by an expected decline in private label business. Net income for the fiscal 2012 first quarter was $4.7 million, compared to net income of $3.7 million for the same period of fiscal 2011. Earnings per diluted share were $0.16 for the fiscal 2012 first quarter, compared to $0.13 for the same period in fiscal 2011. Adjusted EBITDA, which is defined as income from operations before depreciation, amortization and stock-based compensation, was $9.5 million for the fiscal 2012 first quarter, compared to Adjusted EBITDA of $7.0 million for the same period of fiscal 2011.
“We are pleased with our fiscal 2012 first quarter financial results. The combination of strong branded growth and the change in sales mix increased the gross profit margin, which grew to 44.9% from 39.5% last year, and contributed to diluted EPS of $0.16 versus $0.13 last year,” concluded Amin.
The company continues to expect fiscal year 2012 net sales percentage growth of high single-digit to low double-digit. Gross profit percentage is expected to be in the range of 42.0% to 44.0%, reflecting a higher mix of branded sales volume and the launch of new products, together with a significant reduction in the private label business. Selling and marketing expenses, as a percentage of net sales, are estimated to be in the range of 22.0% to 24.0%. Other operating expenses are estimated at approximately $23.0 million to $25.0 million. The company anticipates a very high single-digit operating margin for fiscal 2012.
Conference Call Information
Schiff Nutrition International held a conference call on September 13th. The telephone replay will be available through September 19, 2011.
Reconciliation of Adjusted EBITDA to Income from Operations
This press release refers to non-GAAP financial measures. The Company defines "Adjusted EBITDA" as income from operations before depreciation, amortization and stock-based compensation. This non-GAAP financial measure is not prepared in accordance with generally accepted accounting principles (GAAP) and may be different from non-GAAP financial measures used by other companies. Non-GAAP financial measures should not be considered as a substitute for, or superior to, measures of financial performance prepared in accordance with GAAP. A reconciliation of the non-GAAP measure to the comparable GAAP measure is included in the attached financial tables. Management believes the presentation of Adjusted EBITDA is relevant and useful because Adjusted EBITDA is a measurement industry analysts utilize when evaluating the Company’s operating performance. Management also believes Adjusted EBITDA enhances an investor's understanding of the Company’s results of operations because it measures the Company’s operating performance exclusive of non-cash charges for depreciation, amortization and stock-based compensation. Management also provides this non-GAAP measurement as a way to help investors better understand the Company’s core operating performance, enhance comparisons of the Company’s core operating performance from period to period and to allow better comparisons of the Company’s operating performance to that of its competitors.
About Schiff Nutrition
Schiff Nutrition International, Inc. develops, manufactures, markets and distributes branded and private label vitamins, nutritional supplements and nutrition bars in the United States and throughout the world. Schiff’s portfolio of well-known brands includes Schiff Move Free®, Schiff® Vitamins, Schiff MegaRed®, Schiff Mega-D3®, Tiger's Milk®, Schiff Sustenex®, and Schiff Digestive Advantage®. To learn more about Schiff, please visit the web site www.schiffnutrition.com.