NBTY to continue aggressive expansion strategy
wholesale business with recent acquisitions, reported a 10 per cent
rise in sales for the second quarter to $278 million. The firm said
it is to continue with its expansion strategy in the coming year.
Marketer of nutritional supplements NBTY, which has boosted its wholesale business with recent acquisitions, reported a 10 per cent rise in sales for the second quarter to $278 million. The firm said it is to continue with its expansion strategy in the coming year.
The company also announced it will introduce a new line of low carbohydrate nutritional products, CarbWise, to be sold through food, drug and mass-market channels. Shipments are expected to start in July 2003.
Net income for the quarter ended March 31, dropped to $20 million, however, from $26 million last year, a result of the previously announced one-time charge relating to the discontinued lines of ephedra products. Without this one-time charge, and a $5.5 million payment received in partial settlement of on-going price fixing litigation, net income would have been $22 million.
Sales for the Nature's Bounty wholesale division increased 18 per cent to $85 million from $72 million for the comparable period of fiscal 2002. NBTY said it will continue to focus on increasing market share in the wholesale arena, adding that the brand continued to outdo its competitors.
The company has also recently added the Ohio-based Marc's store chain to its wholesale base. The stores will carry over 180 Nature's Bounty brand products.
Sales at the Vitamin World retail chain were up 5 per cent to $54 million in the second quarter, with same store sales increasing 4 per cent. Vitamin World operations were profitable with pre-tax income of $1 million compared to a loss of $2.3 million for the comparable quarter last year.
Sales at the company's UK chain Holland & Barrett also leaped, by 20 per cent from the comparable prior period to $87 million. Same store sales increased 14 per cent during the second quarter.
The retail business recently acquired the Health & Diet Group with a total of 56 GNC stores, and the FSC wholesale business purchased from Royal Numico. The planned acquisition of the De Tuinen chain of health food stores, which operates 63 stores in the Netherlands, is also expected to be completed by the end of May 2003.
Revenues at the Puritan's Pride e-commerce operations were down 7 per cent however to $52 million from $56 million for the comparable prior period, attributed to different timing of promotional catalog mailings compared to the second quarter a year ago. The next quarter is expected to generate a comparable increase in sales. Additional advertising, sales promotions and efforts to generate faster product delivery to customers, are also planned for the unit in coming months.
NBTY chairman and CEO Scott Rudolph said:"We are very pleased with the addition of Marc's stores to our wholesale operation's growing customer base. The addition of Marc's stores, combined with our purchase of the FSC wholesale business from Royal Numico, bolsters the expansion of our wholesale operation. We have also significantly enhanced our United Kingdom retail business with the recent acquisition of GNC UK."
He added: "We are confident in our ability to further capitalize on market opportunities, complement our operations through strategic acquisitions and enhance our financial strength."
For the six months to end of March, net sales increased 11 per cent to $519 million compared to $467 million for the same period last fiscal year. Net income for the six-month period was $36 million, down slightly from $37 million, for the comparable period last year, again impacted by the $6 million ephedra-related charge.
