BOCA RATON, Fla., March 22 /PRNewswire/ -- Rexall Sundown, Inc.
(Nasdaq: RXSD) today announced results for its second quarter ended February
29, 2000.
Net sales for the second quarter were $176.3 million, an increase of
27% over the $139.0 million reported in the second quarter of 1999. Net
income was $17.0 million for the three months just ended, 5% higher than the
$16.2 million reported in last year's second quarter. Earnings per share of
$0.26 increased 12% from $0.23 in the second quarter of last year, primarily
attributable to the positive impact from our share repurchase program.
In making the announcement, Damon DeSantis, the Company's President and
Chief Executive Officer, stated, "We are extremely pleased with our second
quarter results, which reflect the success of our many initiatives to expand
our leadership across multiple segments within the nutritional supplement
industry. Sales to retailers rose 43% or $40.5 million, including the
contribution from MET-Rx of $17.9 million, which represented only 7 weeks of
sales since the closing of the acquisition in early January. More
importantly, we continue to demonstrate our ability to grow at a rate faster
than the overall industry."
The significant increase in sales to retailers was driven by the
acquisition of MET-Rx, the continued success of the Metab-O-LITE and Osteo
Bi-Flex(R) brands, as well as the introduction of a complete line of
Pokemon(TM) children's vitamins. Mr. DeSantis added, "We continue to deliver
results from the implementation of our strategy to acquire and develop strong
consumer brands." The Company's ability to identify and capitalize on
opportunities and consumer trends in the marketplace, coupled with the
Company's product development and marketing strength, continue to be
demonstrated as Metab-O-LITE remains the #1 selling product at retail in the
diet tablet category, Osteo Bi-Flex remains the #1 selling supplement in the
joint relief category and the Sundown(R) Vitamin and Herbal product lines
remain the #1 selling brands in the total U.S. food, drug and mass markets.
Sales of Rexall Showcase International, the Company's direct selling
division, decreased 6% during the quarter, reflecting an industry-wide
softness in direct selling, as well as lower than expected new distributor
applications. Recognizing these trends, Rexall Showcase recently introduced
the unique rexall.com business model, which provides entrepreneurs with an
easy, inexpensive way to leverage the power of the Internet to help build
their businesses. "The rexall.com model has been enthusiastically received by
our Independent Business Owners since its introduction at the February
corporate conference," DeSantis said.
For the six months just ended, net sales of $318.4 million increased
22% over the $261.1 million reported in 1999. Net income of $28.7 million for
the same six-month period increased 3% compared to the same period last year.
Earnings per share of $0.44 increased $0.05 or 12% over the $0.39 reported in
1999.
During the second quarter, the Company purchased 0.8 million shares of its
common stock for $8.8 million. Since the inception of the share repurchase
program, the Company has repurchased 9.1 million shares for $134.3 million.
Rexall Sundown, Inc. develops, manufactures and distributes vitamins,
nutritional supplements and other consumer health products in the United
States and internationally. Visit the Company's website at
http://www.rexallsundown.com .
This press release may contain "forward-looking statements" as such term
is defined in the Private Securities Litigation Reform Act of 1995 or by the
Securities and Exchange Commission in its rules, regulations and releases,
which represent the Company's interpretation or beliefs. These forward-
looking statements, by their nature, involve substantial risks and
uncertainties, certain of which may be beyond the Company's control and actual
results may differ materially depending on a variety of important factors
including uncertainties related to acquisitions, government regulation,
managing and maintaining growth, the effect of adverse publicity, litigation,
reliance on independent distributors of Rexall Showcase International,
competition and other factors described in the Company's filings with the
Securities and Exchange Commission.
Rexall Sundown, Inc. and Subsidiaries
Consolidated Statements of Operations
(Dollars in thousands, except per share amount)
(Unaudited)
Three Months Ended %
February 29, February 28, Increase
2000 1999 (Decrease)
Net sales $176,329 $138,990 26.9%
Cost of sales 82,287 63,549 29.5%
Gross profit 94,042 75,441 24.7%
Selling, general and
administrative expenses 65,424 50,416 29.8%
Operating income 28,618 25,025 14.4%
Other (expense) income, net (1,027) 829 (223.9%)
Income before income tax provision 27,591 25,854 6.7%
Income tax provision 10,622 9,642 10.2%
Net income $16,969 $16,212 4.7%
Income per common share:
Basic $.26 $.24
Diluted $.26 $.23
Weighted average common
shares outstanding:
Basic 64,062 68,377
Diluted 65,010 69,578
Six Months Ended %
February 29, February 28, Increase
2000 1999 (Decrease)
Net sales $318,427 $261,054 22.0%
Cost of sales 144,752 116,717 24.0%
Gross profit 173,675 144,337 20.3%
Selling, general and
administrative expenses 126,807 101,866 24.5%
Operating income 46,868 42,471 10.4%
Other (expense) income, net (539) 2,100 (125.7%)
Income before income tax provision 46,329 44,571 3.9%
Income tax provision 17,667 16,605 6.4%
Net income $28,662 $27,966 2.5%
Income per common share:
Basic $.45 $.40
Diluted $.44 $.39
Weighted average common
shares outstanding:
Basic 64,248 69,857
Diluted 65,068 71,092
REXALL SUNDOWN, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(Dollars in thousands)
(Unaudited)
February 29, August 31,
2000 1999
ASSETS
Current assets:
Cash and marketable securities $-- $2,124
Trade accounts receivable, net 84,988 71,332
Inventory 129,853 114,861
Other current assets 25,607 23,469
Total current assets 240,448 211,786
Property, plant and equipment, net 69,592 69,274
Goodwill, net 100,480 --
Other assets 17,061 14,291
Total assets $427,581 $295,351
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Accounts payable $44,205 $24,381
Accrued expenses and other
current liabilities 36,893 24,280
Current portion of long - term debt 2,898 15,000
Current liabilities 83,996 63,661
Other liabilities 384 722
Long-term debt 90,842 --
Shareholders' equity 252,359 230,968
Total liabilities and
shareholders' equity $427,581 $295,351
SOURCE Rexall Sundown, Inc.
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Related links:
http://www.rexallsundown.com
CONTACT:
Investors, Donna Conners, or Press, Carol
Walters, both of Rexall Sundown, Inc., 561-241-9400, or General
Information, Karen Griffiths, or Analyst Information, Vanessa
Schwartz, both of The Financial Relations Board, 212-661-8030
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