Tuesday, February 14, 2012
SALT LAKE CITY, Feb. 14, 2012 (GLOBE NEWSWIRE) -- LifeVantage
Corporation (OTCBB:LFVN), maker of Protandim®, the Nrf2 Synergizer™
patented dietary supplement, today reported financial results for
the second quarter and six months ended December 31, 2011.
Fiscal 2012 Second Quarter Highlights Include:
- Net revenue increased 239% to $25.3 million compared to same
quarter last year;
- Operating margin doubled to 16.9% compared to 8.2% in the same
quarter last year;
- Operating income grew 603% compared to the same quarter
last year to $4.3 million;
- Cash and cash equivalents were $13.5 million;
- Four new directors were elected to the Board, adding significant
leadership experience;
- Received approval from warrant holders for and completed a
tender offer to modify certain outstanding warrants such that the
Company will no longer account for these warrants as a derivative
liability, which the Company believes will enable its financials to
more closely reflect operating performance.
- Fiscal 2012 Second Quarter Results
For the second fiscal quarter ended December 31, 2011, the Company
reported record net revenue of $25.3 million, compared to $7.5
million for the same period in fiscal 2011, an increase of 239%. On
a sequential quarter basis, net revenue increased 26% from the
$20.1 million reported for the Company's 2012 first fiscal quarter
ended September 30, 2011.
Gross profit for the quarter ended December 31, 2011 increased to
$21.6 million, compared to $6.3 million for the same period last
year, delivering a gross margin of 85.4%, compared to 84.0% for the
same period last year.
Operating expenses for the second fiscal quarter decreased as a
percent of revenue to 68.5%, or $17.3 million, compared to 75.9% of
revenue, or $5.7 million, for the same period last year. On a
sequential quarter basis, operating expenses as a percentage of
revenue were relatively flat. The gross increase in the amount of
operating expenses is due primarily to increased sales commissions
which are a direct result of the Company's higher sales volume.
This increase also reflects greater investment in personnel and
infrastructure to position the Company for future growth.
Operating income improved to $4.3 million for the second fiscal
quarter, compared to $0.6 million in the same period last year and
$3.4 million in the first fiscal quarter. This was the Company's
sixth consecutive quarter of achieving operating income. Operating
income margin was 16.9% in the second fiscal quarter, compared to
8.2% in the same period last year and 17.1% in the first fiscal
quarter.
Fiscal 2012 First Six Months Results
For the six months ended December 31, 2011, the Company reported
record net revenue of $45.4 million, compared to $13.9 million for
the same period in fiscal 2011, a 226% increase. Operating income
increased to $7.7 million, compared to $1.0 million in the same
period last year.
Douglas C. Robinson, President and Chief Executive Officer of
LifeVantage, stated, "Our record second fiscal quarter revenue and
operating income, combined with the doubling of our operating
margins, underscore our ability to achieve leverage in our business
while making strategic investments. We plan to continue to
strengthen our infrastructure by adding headcount for all areas of
our business and increasing our marketing investments as we build
the necessary platform to continue our profitable organic
growth."
"As awareness and understanding about Protandim and LifeVantage
TrueScience® Anti-Aging Cream continues to expand in consumer
markets as well as among medical professionals, we believe that our
business is positioned for continued long-term growth. We are
seeing a growing number of distributors join our team, as evidenced
by record attendance at our recent quarterly distributor
convention. We look forward to building upon this positive momentum
and delivering another record year for LifeVantage in fiscal
2012."
Mr. Robinson concluded, "Reflecting our commitment to continue
enhancing our corporate leadership, our shareholders recently
elected four new members of the Board of Directors. These directors
add diverse and deep leadership experience to the Board and are a
strong addition to our Company. We are very excited about our
continued outlook for fiscal 2012 and look forward to continuing to
achieve long-term growth and profitability while helping people
around the world improve their health and wellness through the
science of Protandim."
Balance Sheet & Liquidity
The Company improved its balance sheet in the second fiscal
quarter. The Company's cash balance at December 31, 2011 was $13.5
million, an increase from $6.4 million at year end fiscal 2011, due
to strong revenue growth and operating profits. The Company
generated $4.7 million of cash flow from operations in the second
quarter of fiscal 2012, compared to $0.5 million in the second
quarter of fiscal 2011.
On December 29, 2011, the Company received approval from warrant
holders for and completed its tender offer to modify certain
outstanding warrants. As previously announced, LifeVantage filed a
tender offer document with the SEC and initiated a tender offer for
the purpose of amending certain of its warrants to remove the
price-based anti-dilution provision contained in those warrants and
to extend the period during which those warrants may be exercised
by 30 days. As of December 29, 2011, the Company received the
requisite approvals such that all of 12.7 million warrants covered
by the tender offer were amended. As a result, the Company will no
longer account for these warrants as a derivative liability as
currently required under U.S. GAAP.
With the warrant modification and the expiration of certain other
warrants in March and April 2012, the Company anticipates removing
all derivative warrant liabilities from its balance sheet and
eliminating the quarterly changes in fair value of these warrants
from its income statement.
Carrie McQueen, Chief Financial Officer, commented, "We are
pleased with our continued progress in improving our balance sheet
and the overall financial position of LifeVantage. To further
improve the strength of our financial statements, we have
eliminated over $19 million of long-term derivative liabilities
this quarter, dramatically reduced our interest expense, and
successfully modified certain outstanding warrants so we will no
longer account for these warrants as a derivative liability which
enables our financial statements to more closely reflect the
Company's operating performance."
Guidance
The Company is raising its full year guidance for fiscal 2012.
LifeVantage expects to generate revenue for the fiscal year in a
range of $105 million to $115 million, compared to the previous
range of $95 million to $105 million. Further, the Company expects
to generate operating income for the fiscal year in a range of
$13.7 million to $17.3 million, and an operating margin of 13% to
15%. The previous range of operating income was $11.4 million to
$14.7 million, and an operating margin of 12% to 14%.
Conference Call Information
The Company will hold an investor conference call today at 2:30
p.m. Mountain time (4:30 p.m. Eastern time). Investors interested
in participating in the live call can dial (877) 604-9665 from the
U.S. International callers can dial (719) 325-4886. A telephone
replay will be available approximately two hours after the call
concludes and will be available through Thursday, February 16,
2012, by dialing (877) 870-5176 from the U.S., or (858) 384-5517
from international locations, and entering confirmation code
2407254.
There also will be a simultaneous, live webcast available on the
Investor Relations section of the Company's web site at
http://investor.lifevantage.com/events.cfm The webcast will
be archived for 30 days.
About LifeVantage Corporation
LifeVantage, (OTCBB:LFVN), maker of Protandim®, the Nrf2
Synergizer™ patented dietary supplement, is a science based
nutraceutical company. LifeVantage is dedicated to visionary
science that looks to transform wellness and anti-aging internally
and externally with products that dramatically reduce oxidative
stress at the cellular level. The Company was founded in 2003 with
corporate headquarters in Salt Lake City, UT and operations in San
Diego, CA. For more information, visit www.LifeVantage.com.
The LifeVantage Corporation logo is available at
http://www.globenewswire.com/newsroom/prs/?pkgid=11617
Forward Looking Statements
This document contains forward-looking statements made pursuant to
the safe harbor provisions of the Private Securities Litigation
Reform Act of 1995. Words and expressions reflecting optimism,
satisfaction or disappointment with current prospects, as well as
words such as "believe," "hopes," "intends," "estimates,"
"expects," "projects," "plans," "anticipates," "look forward to"
and variations thereof, identify forward-looking statements, but
their absence does not mean that a statement is not
forward-looking. Examples of forward-looking statements include,
but are not limited to, statements we make regarding our
anticipated revenue, operating profitability, cash flow from
operations and future investment and growth. Such forward-looking
statements are not guarantees of performance and the Company's
actual results could differ materially from those contained in such
statements. These forward-looking statements are based on the
Company's current expectations and beliefs concerning future events
affecting the Company and involve known and unknown risks and
uncertainties that may cause the Company's actual results or
outcomes to be materially different from those anticipated and
discussed herein. These risks and uncertainties include, among
others, the potential failure or unintended negative consequences
of the implementation of the Company's network marketing sales
channel; the Company's ability to retain independent distributors
or to attract new independent distributors on an ongoing basis; the
potential for third party and governmental actions involving the
Company's network marketing sales channel; the potential for
product liability claims against the Company; the risk that
government regulators and regulations could adversely affect the
Company's business; future laws or regulations may hinder or
prohibit the production or sale of the Company's existing product
and any future products; unfavorable publicity could materially
hurt the Company's business; and the Company's ability to protect
its intellectual property rights and the value of its product.
These and other risk factors are discussed in greater detail in the
Company's Annual Report on Form 10-K and its Quarterly Report on
Form 10-Q under the caption "Risk Factors," and in other documents
filed by the Company from time to time with the Securities and
Exchange Commission. The Company cautions investors not to place
undue reliance on the forward-looking statements contained in this
document. All forward-looking statements are based on information
currently available to the Company on the date hereof, and the
Company undertakes no obligation to revise or update these
forward-looking statements to reflect events or circumstances after
the date of this document, except as required by law.
Few Full Corporate and Subsidiaries Condensed Consolidated Balance
Sheets (Unaudited)