PURCHASE, N.Y.--(BUSINESS WIRE)--May 14, 2003--Nutrition 21, Inc. (Nasdaq: NXXI), a leading developer and marketer of nutritional products, today reported a fiscal third-quarter net loss of $1.1 million ($0.03 per diluted share) on revenues of $3.1 million, compared with a net loss of $0.2 million ($0.01 per diluted share) on revenues of $4.0 million for the same period a year ago.
For the nine months ended March 31, 2003 the company reported a net loss of $3.5 million ($0.11 per diluted share) on revenues of $8.8 million compared with net income of $0.7 million ($0.02 per diluted share) on revenues of $10.8 million for the comparable period a year ago. Included in the nine month period last year was a one-time pre-tax gain of $1.8 million ($0.3 per diluted share, net of tax), from the settlement of patent infringement lawsuits and a sale of assets. The company ended the quarter in a strong financial position with $4.8 million in cash and net working capital of $6.1 million.
Gail Montgomery, President and CEO of the company, said, "The reduction in net sales in the quarter and year to date reflects the softness in sales of Lite Bites products due to lack of air time on QVC from October 2002 through February 2003 and less than expected sales after a newly revamped product line returned to the air in late February. To protect ourselves against any further losses associated with the Lite Bites product line, we are continuing our search for an appropriate partner(s) to expand distribution of these products in new channels."
Montgomery continued, "We remain committed to investing in our longer-term strategy of translating the health benefits associated with chromium picolinate into therapeutic consumer brands-- an effort currently supported by our stable ingredients business and cash reserves. The Council for Advancement of Diabetes Research and Education (CADRE) Research Summit: 'Chromium in Health and Disease' held in early April was an important Company milestone." Sixteen leading researchers from across the globe gathered to confirm the essential role of chromium in improving insulin resistance, a condition estimated to affect as many as one in four Americans. Over twenty studies on chromium picolinate that were either completed or nearing completion were presented on a wide range of topics, including obesity, diabetes, cardiovascular disease, depression, women's health and animal fertility. In addition, epidemiological research suggested a strong correlation between chromium deficiency and chronic disease. "With the publication of many of these studies slated for the end of 2003, we believe demand for our proprietary products should increase significantly," said Montgomery.
The Company will continue to incur expenses associated with the expected calendar 2004 launch of its proprietary Diachrome(TM) and Zeramax(TM) supplement brands into diabetes and depression therapeutic markets. Montgomery added, "Our two key studies with Diabetex, Inc, and Comprehensive NeuroSciences, Inc. ('CNS') are progressing as planned, with the CNS study ahead of its original enrollment targets."
About Nutrition 21
Nutrition 21 is a leading developer and provider of nutritional products whose health benefits have been substantiated by clinical research. The Company markets Chromax chromium picolinate, the leading brand of chromium and holds 35 patents for nutrition products, 22 for chromium compounds and their uses. More information is available at www.nutrition21.com.
Safe Harbor Provision
This press release may contain certain forward-looking statements. The words "believe," "expect," "anticipate" and other similar expressions generally identify forward-looking statements. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of their dates. These forward-looking statements are based largely on the Company's current expectations and are subject to a number of risks and uncertainties, including without limitation: the effect of the expiration of patents; regulatory issues; uncertainty in the outcomes of clinical trials; changes in external market factors; changes in the Company's business or growth strategy or an inability to execute its strategy due to changes in its industry or the economy generally; the emergence of new or growing competitors; various other competitive factors; and other risks and uncertainties indicated from time to time in the Company's filings with the Securities and Exchange Commission, including its Registration Statement on Form S-3, the Prospectus dated April 25, 2000, its Form 10-K for the year ended June 30, 2002, and its Form10-Q for the quarters ended September 30 and December 31, 2002. Actual results could differ materially from the results referred to in the forward-looking statements. In light of these risks and uncertainties, there can be no assurance that the results referred to in the forward-looking statements contained in this press release will in fact occur. Additionally, the Company makes no commitment to disclose any revisions to forward-looking statements, or any facts, events or circumstances after the date hereof that may bear upon forward-looking statements.