Sundown Osteo-Bi-Flex contributes to record Rexall quarter; revenues break $100 mil..
This article was originally published in The Tan Sheet
Executive Summary
REXALL SUNDOWN REVENUES INCREASE 83% TO $102.5 MIL. IN FIRST QUARTER, boosted by sales of the company's Osteo-Bi-Flex patented glucosamine/chondroitin combination formula, the dietary supplement manufacturer and distributor announced Dec. 17. Osteo-Bi-Flex, targeted to people with osteoarthritis and "creaky joints," recorded sales of $12 mil. in the quarter ended Nov. 30. The product is now the "third best-selling nutritional supplement" in the U.S., Boca Raton, Fla.-based Rexall Sundown said. In October, the company reported the supplement to be in the "top 10" of product sales in the nutritional category ("The Tan Sheet" Oct. 20, p. 17).
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REXALL SUNDOWN REVENUES INCREASE 83% TO $102.5 MIL. IN FIRST QUARTER, boosted by sales of the company's Osteo-Bi-Flex patented glucosamine/chondroitin combination formula, the dietary supplement manufacturer and distributor announced Dec. 17. Osteo-Bi-Flex, targeted to people with osteoarthritis and "creaky joints," recorded sales of $12 mil. in the quarter ended Nov. 30. The product is now the "third best-selling nutritional supplement" in the U.S., Boca Raton, Fla.-based Rexall Sundown said. In October, the company reported the supplement to be in the "top 10" of product sales in the nutritional category ("The Tan Sheet" Oct. 20, p. 17). Introduced in mid-May, Osteo-Bi-Flex is the first product Rexall has supported with a national advertising campaign ("The Tan Sheet" May 5, p. 15). "The combination of a proprietary product and strong distribution, supported by national advertising, has produced excellent results and we intend to use this strategy for future product introductions," Rexall said. The $102.5 mil. in quarterly net sales marks the first time Rexall has broken the $100 mil. mark. Both retail revenues and direct sales through the firm's Rexall Showcase International division contributed to the "strong, positive momentum," the company stated. Retail sales rose 107% in the quarter; direct sales increased 63%. The company's Sundown brand "continues to gain distribution and is performing extremely well," Rexall said. Net income jumped 87% to $13.6 mil. from $7.2 mil. in the same period of FY 1997. Results for the quarter reflect the ongoing Osteo-Bi-Flex ad campaign, Rexall pointed out. However, despite the $3.3 mil. in dedicated ad spending, the firm's operating margins rose to only 19.7% of sales compared to 19.5% a year ago. Selling, general & administrative expenses jumped 73.1% to $42.3 mil. from $24.4 mil. in the same period a year ago. "Based on these favorable results and the market's continued positive response, we will increase our commitment to advertising in fiscal 1998," Rexall said. "Rexall Sundown's financial results prove that our investments in management, systems and infrastructure over the past two years have provided a solid platform for growth." The dietary supplement company noted its intention to continue evaluating potential acquisitions. A proposed merger with Twin Labs was canceled in September after the Securities & Exchange Commission indicated the transaction could not be accounted for as a pooling of interests ("The Tan Sheet" Sept. 8, In Brief). |