- 2022 Q3: Net Income Increased 30.7% and Diluted EPS
Increased 36.7%
- Q4 Fiscal 2022 Outlook: 18% - 21% Net Sales
Increase
CARLSBAD, Calif., May 13, 2022
/PRNewswire/ -- Natural Alternatives International, Inc. ("NAI")
(Nasdaq: NAII), a leading formulator, manufacturer, and marketer of
customized nutritional supplements, today announced net income of
$2.5 million, or $0.41 per diluted share, on net sales of
$42.4 million for the third quarter
of fiscal year 2022 compared to net income of $1.9 million, or $0.30 per diluted share, in the third quarter of
the prior fiscal year.
Net sales during the three months ended March 31, 2022, decreased $3.9 million, or 8.5%, to $42.4 million as compared to $46.3 million recorded in the comparable prior
year period. During the same period, private-label contract
manufacturing sales decreased 10.8% to $37.6
million. Private-label contract manufacturing sales
decreased primarily due to a 40% reduction in sales to our largest
customer partially offset by sales to other existing customers and
a new customer. Sales backlog for the quarter ended March 31, 2022 totaled approximately $10.0 million primarily related to supply chain
issues, labor shortages, and logistical constraints.
CarnoSyn® beta-alanine royalty, licensing and raw material sales
revenue increased 15.2% to $4.8
million during the third quarter of fiscal year 2022, as
compared to $4.1 million for the
third quarter of fiscal year 2021. The increase in patent and
trademark licensing revenue during the third quarter of fiscal 2022
was primarily due to increased shipments to existing customers
related in part to athletic activities and gyms reopening in
accordance with easing COVID-19 restrictions across the
USA as compared to significant
restrictions in athletic activities primarily impacting the first
nine months of fiscal 2021.
Net income for the nine months ended March 31, 2022 was $7.6
million, or $1.22 per diluted
share, compared to net income of $7.8
million, also $1.22 per
diluted share, for the nine months ended March 31, 2021. Net income for the first nine
months of fiscal 2021 included a $0.9
million discrete tax benefit while the first nine months of
fiscal 2022 did not have a corresponding discrete item.
Net sales during the nine months ended March 31, 2022 decreased $15.7 million, or 11.7%, from $134.1 million recorded in the comparable prior
year period. For the nine months ended March
31, 2022, private-label contract manufacturing sales
decreased $19.7 million, or 15.8%,
from the comparable period last year. CarnoSyn® beta-alanine
royalty, licensing and raw material sales revenue increased 41.7%
to $13.5 million during the first
nine months of fiscal 2022, as compared to $9.6 million for the first nine months of fiscal
2021.
Based on our current sales order volumes and forecasts we have
received from our customers, and despite the continued challenges
with supply chain and staffing shortages, including challenges from
COVID-19 employee absences, we now anticipate our consolidated net
sales during the fourth quarter of fiscal 2022 will increase
between 18.0% to 21.0% as compared to the fourth quarter of fiscal
2021. We also anticipate operating income as a percent of net sales
will increase to between 9.0% and 12.0% for our fourth quarter
ending June 30, 2022. The improvement
in net sales and operating profitability is expected to be
generated from continued growth from one of our newest customers,
improved sales demand from our largest customer, improved sales mix
and improved staffing levels which will increase our production
capacities.
As of March 31, 2022, we had cash
of $18.6 million and working capital
of $53.8 million, compared to
$32.1 million and $58.3 million respectively, as of June 30, 2021. As of March
31, 2022, we had $20.0 million
available under our line of credit agreement.
Mark A. Le Doux, Chairman and
Chief Executive Officer of NAI stated, "Considering our ongoing
staffing and supply chain challenges combined with a decline in
sales from our largest customer, we are pleased with the results of
our third quarter and first nine months of fiscal 2022. We
successfully increased the capacity of our Vista California facility with the
installation of a new high-capacity blender, which increased our
throughput potential and enables us to better meet the demands of
our customers while we continue construction on our new powder
facility. While we were able to partially reduce our backlog going
into the fourth quarter, demand remains strong, and we are
continuing to add staff and navigate supply chain challenges. We
expect to make significant strides to further reduce our backlog
during our fourth quarter."
"We will continue to utilize our robust balance sheet and free
cash flow to drive shareholder value through both share buybacks
and investments in our business. We continue to believe our stock
is trading well below the true value of our Company."
"I am proud of the efforts of our team as they have diligently
navigated the mercurial landscapes of staffing and supply chain
combined with the evolving needs of our clients. We still see
significant opportunity for growth in both the near and long term
and I believe the foundation we have laid over the past couple
years will pave the way for future growth opportunities."
An updated investor presentation will be posted to the investor
relations page on our website later today
(https://www.nai-online.com/our-company/investors/).
NAI, headquartered in Carlsbad,
California, is a leading formulator, manufacturer and
marketer of nutritional supplements and provides strategic
partnering services to its customers. Our comprehensive partnership
approach offers a wide range of innovative nutritional products and
services to our clients including scientific research, clinical
studies, proprietary ingredients, customer-specific nutritional
product formulation, product testing and evaluation, marketing
management and support, packaging and delivery system design,
regulatory review and international product registration
assistance. For more information about NAI, please see our website
at http://www.nai-online.com.
This press release contains forward-looking statements within
the meaning of Section 21E of the Securities Exchange Act of 1934
that are not historical facts and information. These statements
represent our intentions, expectations and beliefs concerning
future events, including, among other things, our ability to
develop, maintain or increase sales to new and existing customers,
our ability to attract and retain sufficient labor, COVID-19 and
related impacts on the availability of raw materials, our future
revenue profits and financial condition, as well as future economic
conditions and the impact of such conditions on our business. We
wish to caution readers these statements involve risks and
uncertainties that could cause actual results and outcomes for
future periods to differ materially from any forward-looking
statement or views expressed herein. NAI's financial performance
and the forward-looking statements contained herein are further
qualified by other risks, including those set forth from time to
time in the documents filed by us with the Securities and Exchange
Commission, including our most recent Annual Report on Form
10-K.
CONTACT – Michael Fortin, Chief
Financial Officer, Natural Alternatives International, Inc., at
760-736-7700 or investor@nai-online.com.
Web site: http://www.nai-online.com
NATURAL ALTERNATIVES
INTERNATIONAL, INC
|
CONDENSED
CONSOLIDATED STATEMENTS OF INCOME
|
(In thousands, except
per share data)
|
|
|
|
|
|
|
|
|
|
(Unaudited)
|
|
|
|
(Unaudited)
|
|
|
|
Three Months
Ended
|
|
|
|
Nine Months
Ended
|
|
|
|
March 31,
|
|
|
|
March 31,
|
|
|
|
2022
|
|
|
|
2021
|
|
|
|
2022
|
|
|
|
2021
|
|
|
NET
SALES
|
$ 42,373
|
|
100.0%
|
|
46,320
|
|
100.0%
|
|
118,440
|
|
100.0%
|
|
134,129
|
|
100.0%
|
Cost of goods
sold
|
34,980
|
|
82.6%
|
|
39,484
|
|
85.2%
|
|
96,220
|
|
81.2%
|
|
111,614
|
|
83.2%
|
Gross profit
|
7,393
|
|
17.4%
|
|
6,836
|
|
14.8%
|
|
22,220
|
|
18.8%
|
|
22,515
|
|
16.8%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Selling, general &
administrative expenses
|
4,119
|
|
9.7%
|
|
4,136
|
|
8.9%
|
|
12,317
|
|
10.4%
|
|
12,338
|
|
9.2%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
INCOME FROM
OPERATIONS
|
3,274
|
|
7.7%
|
|
2,700
|
|
5.8%
|
|
9,903
|
|
8.4%
|
|
10,177
|
|
7.6%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other expense,
net
|
(88)
|
|
-0.2%
|
|
(326)
|
|
-0.7%
|
|
(123)
|
|
-0.1%
|
|
(1,453)
|
|
-1.1%
|
INCOME BEFORE
TAXES
|
3,186
|
|
7.5%
|
|
2,374
|
|
5.1%
|
|
9,780
|
|
8.3%
|
|
8,724
|
|
6.5%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income tax
expense
|
682
|
|
|
|
458
|
|
|
|
2,173
|
|
|
|
918
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
NET
INCOME
|
$ 2,504
|
|
|
|
$ 1,916
|
|
|
|
$
7,607
|
|
|
|
$
7,806
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
NET INCOME PER
COMMON SHARE:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic:
|
$0.42
|
|
|
|
$0.31
|
|
|
|
$1.23
|
|
|
|
$1.24
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted:
|
$0.41
|
|
|
|
$0.30
|
|
|
|
$1.22
|
|
|
|
$1.22
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
WEIGHTED AVERAGE COMMON
SHARES
OUTSTANDING:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
6,003
|
|
|
|
6,201
|
|
|
|
6,168
|
|
|
|
6,296
|
|
|
Diluted
|
6,041
|
|
|
|
6,327
|
|
|
|
6,216
|
|
|
|
6,401
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
NATURAL ALTERNATIVES
INTERNATIONAL, INC
|
CONDENSED
CONSOLIDATED BALANCE SHEETS
|
(In
thousands)
|
|
|
|
|
|
(unaudited)
|
|
|
|
March
31,
|
|
June
30,
|
|
2022
|
|
2021
|
|
|
|
|
ASSETS
|
|
|
|
Cash and cash
equivalents
|
$18,575
|
|
$32,133
|
Accounts receivable,
net
|
16,736
|
|
17,946
|
Inventories,
net
|
36,800
|
|
27,006
|
Other current
assets
|
6,095
|
|
3,263
|
Total current assets
|
78,206
|
|
80,348
|
Property and equipment,
net
|
40,400
|
|
22,271
|
Operating lease
right-of-use assets
|
14,049
|
|
15,877
|
Other noncurrent
assets, net
|
2,833
|
|
1,785
|
Total Assets
|
$135,488
|
|
$120,281
|
|
|
|
|
LIABILITIES AND
STOCKHOLDERS' EQUITY
|
|
|
|
Accounts payable and
accrued liabilities
|
25,963
|
|
23,717
|
Mortgage note
payable
|
9,863
|
|
-
|
Long-term liability -
operating leases
|
14,585
|
|
16,481
|
Total Liabilities
|
50,411
|
|
40,198
|
Stockholders'
Equity
|
85,077
|
|
80,083
|
Total Liabilities and Stockholders' Equity
|
$135,488
|
|
$120,281
|
|
|
|
|
View original
content:https://www.prnewswire.com/news-releases/natural-alternatives-international-inc-announces-2022-q3-and-ytd-results-301546755.html
SOURCE Natural Alternatives International, Inc.