COPPELL, TX -- 05/10/2006 -- Mannatech, Incorporated (MTEX) today announced record first quarter earnings for the three months ended March 31, 2006 as compared to the prior year's comparable quarter. Highlights from the quarter included:
-- Sales grew 16% to $99.0 million, up $13.9 million;
-- Earnings before income taxes rose 19% to $9.3 million;
-- Net income increased by 27%, or $1.2 million, to $5.9 million from
-- Diluted earnings per share rose by 29%, or $0.05 per share, to $0.22
per share from $0.17 per share;
-- Current independent associates and members increased to 510,000; up by
109,000 or 27% from a year ago.
Chairman of the Board and Chief Executive Officer Samuel Caster stated, "We are pleased with our results as solid sales and profit growth continued in the first quarter. We began our annual travel incentive qualifying period in January this year instead of March, which has been the traditional kick-off for the incentive. This timing shift added approximately $1.7 million in travel cost accrual to the 2006 quarter, seen in our higher rate of commission and incentive expense this year. However, we reduced our total operating expense rate by 1.7 points, and our operating profit increased by $1.5 million. Our current associate and member count grew 27% against last year and topped the half-million mark for the first time. These successes clearly demonstrate the viability of our products as well as that of our business model."
"During the first three months of 2006, we maintained a debt-free balance sheet, improved our working capital, reduced our inventory levels, and preserved a strong cash position of over $71 million. We increased our quarterly declared dividends to $0.08 per share as compared to $0.07 per share last year. Our Board intends to share the growth in the value of Mannatech by continuing our quarterly dividend payments to our shareholders as a reward for their long-term stock ownership," said Mr. Caster.
Mannatech, Incorporated is a global wellness solutions provider that develops innovative, high-quality, proprietary nutritional supplements, topical products, and weight management products, which are sold through a global network-marketing system operating throughout 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 "may," "believes," "enthusiastic," "demonstrates," "intends," "optimistic," and "plans" 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 its expectations, statements, and assumptions reflected in these forward-looking statements are reasonable, it cautions its 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.