Natrol Reports Second Quarter Results

CHATSWORTH, Calif., Aug 14, 2007 (BUSINESS WIRE) -- Natrol, Inc. (NTOL) , a leading manufacturer and marketer of nationally branded nutritional products, today announced operating results for the period ended June 30, 2007.

Sales during the quarter rose 17.8% to $19.5 million compared to $16.6 million in the year-ago quarter. The Company attributed the sales increase to a strong performance from new products which more than offset a $0.9 million decline that results from the planned discontinuation of Ester-C. At the same time, the Company saw significant improvement in gross margin, which rose 410 basis points to 47.5% versus 43.4% in the year-ago quarter. The Company noted that while core expenses showed leverage as costs were controlled, it also invested in building platforms for growth in both the United Kingdom and in the Far East. Even with this investment spending, the company saw a sharp increase in operating income, which rose 172.9% to $737,000 versus $270,000 in the second quarter of 2006.

Earnings per share for the second quarter were $0.25 per diluted share versus $0.01 per diluted share in the year-ago quarter. The Company noted that during the quarter, it booked a $6.1 million one-time gain on the sale of its corporate facilities which had the effect of increasing reported earnings by $0.22 per share.

Wayne Bos, President and CEO of Natrol, commented, "We are very pleased by the progress we made this past quarter. In addition to good financial results, we made excellent strategic progress with our business. The acquisition of MRI closed late in the quarter and further diversified our business. MRI provides not only a premium brand but contributes a strong, science-based pipeline for further penetration and market development of higher-growth areas of the nutraceutical business. The sale and lease back transaction we completed has given us ready access to capital and the ability to continue to enter into strategic transactions to leverage the considerable platform we are building with a balance sheet that is essentially debt free."

Mr. Bos concluded, "We are confident of our solid and sustainable turnaround in the business of Natrol. Our brand portfolio, which targets several important tiers of distribution, is reliable and growing. We are positioned well to enter the international marketplace. The enhancement of our strategic vision by MRI positions Natrol to again be a company with genuine growth. We believe that we are well positioned to continue our growth trajectory and drive significant value to our shareholders."

About Natrol - Nourishing the Potential of Mind and Body (SM)
Natrol, Inc. (NTOL) , headquartered in Chatsworth, CA, has a portfolio of health and wellness brands representing quality nutritional supplements, functional herbal teas, and sports nutrition products. Established in 1980, Natrol's portfolio of brands includes: Natrol(R), Prolab(R), Laci Le Beau(R), Promensil(R), Trinovin(R), Nu Hair(R),Shen Min(R) ,and MRI(R). The company also manufactures supplements for its own brands and on behalf of third parties.
Natrol distributes products nationally through more than 54,000 retailers, as well as internationally in over 40 other countries through distribution partners and subsidiaries in the UK and Hong Kong. For more information, visit

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 and Section 21E of the Securities Exchange Act of 1934. 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 in the forward-looking statements include, without limitation: (i) our ability to develop and execute our business plans, (ii) our ability to respond to competitive challenges and changing consumer preferences, (iii) our ability to consummate and integrate acquisitions, (iv) increased competition, (v) unfavorable publicity about dietary supplements in general or regarding our products or similar products sold by others, (vi) our exposure to product liability claims, our dependence upon certain large customers, and (vii) our ability to retain and attract talented management and other key employees, 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, 2006, and in our other filings with the Securities and Exchange Commission.

Hide comments


  • Allowed HTML tags: <em> <strong> <blockquote> <br> <p>

Plain text

  • No HTML tags allowed.
  • Web page addresses and e-mail addresses turn into links automatically.
  • Lines and paragraphs break automatically.