COPPELL, Texas, Nov 08, 2007 (BUSINESS WIRE) -- Mannatech, Incorporated (MTEX) today reported third quarter earnings of $0.07 per diluted share for the three months ended September 30, 2007, down 80.6% from the 2006 third quarter earnings of $0.36 per diluted share. Net income for the third quarter, 2007, declined to $1.7 million, a decrease of 82.5% compared to $9.7 million in the third quarter of 2006. Pretax profit was $2.1 million, a decrease of 83.2% compared to $12.7 million in the same period last year. Operating expenses were reduced over $4 million compared to the second quarter of 2007.
Third quarter net sales for 2007 were $96.8 million, a decrease of 2.8%, compared to $99.6 million in the third quarter of 2006. The sales decline resulted from a 15% decrease in North America sales compared to the third quarter of 2006. This was partially offset by a 30% increase in sales from international markets, primarily in Asia, in the third quarter of 2007 compared to the third quarter of 2006.
Terry Persinger, President and CEO commented, "Our top priorities in the third quarter were to reduce operating expenses and to fully integrate our GlobalView system. We reduced operating expenses $4.1 million, or more than 10% in the third quarter compared to the second quarter of 2007. GlobalView's integration is now largely complete and we are preparing for market expansion in the near future. Similar to the second quarter, we incurred additional depreciation expense due to the GlobalView utilization."
Total independent Associate and Member count based on a 12-month trailing period increased to 575,000 for the third quarter of 2007 as compared to 536,000 for the third quarter of 2006. The 7.3% growth resulted from higher retention of continuing independent Associates and Members which were up 51,000, a 15.5% increase compared to the same period last year. This increase was partially offset by a 5.8% decline in new independent Associates and Members on a 12-month trailing basis.
Mr. Persinger said, "We will continue focusing on cost control as we shift considerable attention to driving domestic sales and recruiting. Our recent hiring of Al Bala as Senior Vice President of Global Business Development is indicative of our commitment to re-energize our domestic market. Al brings over 20 years network marketing experience in implementing key programs to drive sales and recruiting."
Year-to-date sales through September reached $312.8 million, up 3.1% from 2006. Net income for the nine-month period was $10.2 million, down 58.3% from last year's net income of $24.2 million. Diluted earnings per share were $0.38, a decrease of 57.3% versus $0.89 for the nine-months ended September 2006.
Mannatech, Incorporated is a global wellness solutions provider of innovative, high-quality, proprietary nutritional supplements, topical and skin care products, and weight management products sold through independent Associates and Members located in the United States and the international markets of Canada, Australia, the United Kingdom, Japan, New Zealand, the Republic of Korea, Taiwan, Denmark, and Germany.
Please Note: This release contains "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, Section 21E of the Securities Exchange Act of 1934, as amended, and the Private Securities Litigation Reform Act of 1995. These forward-looking statements generally can be identified by use of phrases or terminology such as "will continue" or other similar words or the negative of such terminology. Similarly, descriptions of Mannatech's objectives, strategies, plans, goals or targets contained herein are also considered forward-looking statements. Mannatech believes this release should be read in conjunction with all of its filings with the United States Securities and Exchange Commission and cautions its readers that these forward-looking statements are subject to certain events, risks, uncertainties, and other factors. Some of these factors include, among others, Mannatech's inability to attract and retain associates and members, increases in competition, litigation, regulatory changes, and its planned growth into new international markets. Although Mannatech believes that the expectations, statements, and assumptions reflected in these forward-looking statements are reasonable, it cautions readers to always consider all of the risk factors and any other cautionary statements carefully in evaluating each forward-looking statement in this release, as well as those set forth in its latest Annual Report on Form 10-K, and other filings filed with the United States Securities and Exchange Commission, including its current reports on Form 8-K. All of the forward-looking statements contained herein speak only as of the date of this release.