Financial Report
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Down and Up Like a Yo-Yo
Fourth Quarter Results
March Stock Watch
Fourth Quarter Results
RBC Life Sciences
RBC Life Sciences Inc. (RBCL—OTC:BB) reported a 12 percent increase in net sales to $21,697,000 and a 15 percent increase in earnings before income taxes to $714,000 in the year ended Dec. 31, 2006, compared to net sales of $19,361,000 and earnings before income taxes of $619,000 in the previous year. Net earnings in 2006 were $436,000, or $0.02 per share, compared with net earnings in 2005 of $592,000, or $0.03 per share.
Net earnings declined in 2006 because of the $251,000 increase in a provision for income taxes to $278,000 in 2006 from $27,000 in the previous year. The tax provision in 2006 increased because the company used up its net operating loss carryforwards, as determined for financial reporting purposes, in 2005.
“The growth in earnings before income taxes was driven by improved operating margins and strong sales increases in both of our operating segments: nutritional products and MPM medical products. Growth in sales of nutritional products was generated by a 34 percent increase in sales to our international licensees,” said Clinton Howard, CEO. “Orders from international licensees for which a deposit has been made, and finished products, which are fully paid but held pending receipt of shipping instructions, represent our backlog and have not been recorded as sales. This backlog of orders increased 39 percent to $3,374,000 at the end of 2006, compared to a backlog of $2,436,000 at the end of 2005.”
The company manufactures and markets nutritional supplements, skincare products, and nanoscale compounds, including its largest selling product, Microhydrin® Plus™, an antioxidant that scavenges cell-damaging free radicals. RBC products are sold worldwide through independent distributors and licensees in 17 countries.
Medifast
Medifast Inc. (MED—NYSE) announced fourth quarter and year-end financial results for the period ended Dec. 31, 2006. For the full year ended Dec. 31, 2006, Medifast reported revenue of $74.1 million, an 85 percent increase from $40.1 million in 2005. The company reported net income of $5,082,000, or $0.40 per basic share ($0.38 per diluted share), vs. $2,436,000 or $0.20 per basic share ($0.19 per diluted share) in 2005. This represented a 100 percent increase in both basic and diluted earnings per share.
The company reported fourth quarter revenue of $15.3 million, compared to revenue of $10.2 million for the same period in 2005, an increase of 50 percent. The company reported net income of $443,000, or $0.03 per basic share ($0.03 per diluted share), compared to $849,000, or $0.05 per basic share ($0.04 per diluted share) for the fourth quarter of 2005. The fourth quarter of 2006 represented the company’s 29th consecutive quarter of profitability.
“We have multiple platforms for growth and a strong brand that is trusted by the medical community and our growing customer base,” said Michael S. McDevitt, CEO. “2006 was a fantastic year for our company as we were recognized by Forbes magazine, which listed Medifast 28th of the top 200 small companies in the United States.”
For 2007, the company expects to report revenue of $85 to $88 million, representing a year-over-year increase of 15 percent to 19 percent, with after-tax profit of $0.45 to $0.46 per diluted share, an increase of 18 percent to 21 percent from 2006. On a quarterly basis, full-year 2007 guidance will be reviewed, reiterated or updated as necessary.
Medifast is a leading easy-to-use, clinically proven, portion-controlled weight loss program. The company sells its products and programs via four unique distribution channels: the Web and national call centers, a national network of physicians, medically supervised Medifast Weight Control Centers, and the Take Shape for Life program. Medifast was founded in 1980 and is located in Owings Mills, Maryland.
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