NutraMax cites softness in cough/cold market for flat third-quarter sales.
This article was originally published in The Tan Sheet
Executive Summary
NUTRAMAX THIRD-QUARTER SALES DECLINE 1.4% TO $15.2 MIL., reflecting "continued softness" in the cough/cold products market due to a mild winter and slower inventory sell-through at retail, the company said in a July 24 release. Net income for the quarter ended July 1 dropped 27.7% to $857,000, from $1.2 mil. the previous year.
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NUTRAMAX THIRD-QUARTER SALES DECLINE 1.4% TO $15.2 MIL., reflecting "continued softness" in the cough/cold products market due to a mild winter and slower inventory sell-through at retail, the company said in a July 24 release. Net income for the quarter ended July 1 dropped 27.7% to $857,000, from $1.2 mil. the previous year. The Gloucester, Mass.-based private-label company expects to recover some of its sales shortfall in the fourth quarter based on a "growing backlog" of customer orders for cough/cold products scheduled for shipment during that period. NutraMax also predicts "record sales" for eye care products in the fourth quarter due to recent retail "approvals" for new eye care products. NutraMax recently received "approval" from Revco Drug Stores for four SKUs of its Liquid Adult Nutritionals line, the firm said. With the addition of Revco, NutraMax said, it will have gained distribution in three of the top five U.S. drug chains in terms of store count. The line, which is similar to Ross Labs' Ensure, is also sold in CVS and Rite-Aid stores. Reorders from current customers for the liquid nutritionals line remain "strong," NutraMax said, and plans are on schedule for the launch of three additional liquid nutritional products this fall. PDK Labs' second-quarter sales advanced 35.5% to $7 mil. for the period ended May 31, the private-label OTC company reported July 18. However, net earnings fell 58% to $106,633 during the period. PDK attributed the earnings drop to its competitive pricing programs to "preferred customers." The limited-time program is designed to boost distribution and market share. "Management believes that this price structure for an introductory period has resulted in an increase in sales and will result in an increase in earnings as customers reorder products at a higher price," PDK said. Herbalife International net sales increased 4% to $124.8 mil. for the second quarter. Retail sales also advanced 4% to $235.4 mil. Net income dropped 47.5% to $8.1 mil. for the period ended June 30. The company said the earnings decline was due to "additional investments in the development of new products and country openings; high costs related to distributor training; incentives and new sponsorships; and increased operating expenses at the country level." Due to the "successful" December 1994 opening of the Philippines market and "positive momentum" in Japan, retail sales in the Asia/Pacific Rim region increased 191% over the prior-year period, Herbalife said. Sales in the Americas were up 14%, boosted by increases in the U.S. and the addition of Argentina and Venezuela. U.S. retail sales grew 14% to $88.2 mil., accounting for 37% of Herbalife's total retail sales. In Europe, the company's largest market, retail sales declined 20% in the quarter due to softness in France, Israel, Spain and the U.K. The European region contributed 44% of total retail sales during the quarter. Sales for Thermojetics products rose 30% to $42.3 mil. worldwide and accounted for 18% of total retail sales in the quarter, Herbalife said. Sales for the new Dermajetics personal care products line totaled $30.5 mil., accounting for 13% of total retail sales. |