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FitLife Brands Announces 2017 Results

Updated: Jun 8, 2018




FitLife Brands, Inc. ("FitLife") (OTC:PINK - FTLF), an international provider of innovative and proprietary nutritional supplements for health-conscious consumers marketed under the brand names NDS Nutrition Products™ ("NDS") (www.ndsnutrition.com), PMD® (www.pmdsports.com), SirenLabs® (www.sirenlabs.com), CoreActive®(www.coreactivenutrition.com), Metis Nutrition™ (www.metisnutrition.com), iSatori™ (www.isatori.com), Energize (www.tryenergize.com), and BioGenetic Laboratories, (www.biogeneticlabs.com), announces results for its fiscal year ended December 31, 2017.


Highlights for the full year ended December 31, 2017 include:

  • Total revenue declined $7.5 million, or 29.7%, to $17.8 million from $25.3 million

  • Core FitLife revenue decreased 25.0% to $13.7 million from $18.3 million

  • iSatori revenue decreased 41.9% to $4.1 million from $7.1 million

  • The Company wrote off all remaining goodwill and intangible assets totaling $5.9 million related to the iSatori acquisition and established $1.1 million of reserves for potential sales returns primarily related to iSatori products

  • Inclusive of the write offs and establishment of reserves, net loss for the year ended December 31, 2017 was $9.8 million as compared to net income of $0.4 million for the prior year

  • Cash provided by operating activities was $0.7 million as compared to $0.0 million for the prior year

  • Total cash at year end was $1.3 million, which was essentially equivalent to the prior year

  • The Company entered into a merchant agreement with BBVA Compass Bank in December 2017, which enabled the Company to pay off all amounts owed US Bank in January 2018, leaving the Company debt-free

For the full year ended December 31, 2017, total revenue was $17.9 million versus $25.3 million in 2016. Core FitLife revenue for 2017 was $13.7 million compared to $18.3 million a year ago. The decline was primarily attributable several trends and developments with our largest customer including reduced foot traffic and lower overall store count which in turn disrupted inventory replenishment and purchasing patterns. Revenue for the iSatori division for 2017 was $4.1 million versus $7.1 million for the prior year. The decline at iSatori was primarily attributable to fewer new product introductions as well as the restructuring of its largest third-party distributor.


Net loss for the year ended December 31, 2017 was $9.8 million as compared to net income of $0.4 million for the year ended December 31, 2016. Results from operations during the year ended December 31, 2017 included $8.7 million in charges that management believes are non-recurring including, but not limited to, impairment of $5.9 million of intangible assets, establishment of more than $1 million in sales return reserves and fulfillment of a margin support agreement during the year with our largest customer. Reconciling for such items believed by management to be non-cash and/or non-recurring, comparable adjusted EBITDA for the year ended December 31, 2017 was negative $0.4 million as compared to positive $1.2 million for the comparable period last year.


"This last year posed a series of significant challenges to our business, and we are obviously very disappointed in our 2017 year-end financial results. That said, there are a number of noteworthy trends and developments that, we believe, will positively impact the business going forward as we strive to return to profitability and create shareholder value in 2018 and beyond," said Dayton Judd, Interim CEO of FitLife Brands. "We are already beginning to see benefits from the improving financial condition of our largest customer, and look forward to continuing to work collaboratively with them in support of our mutual best interests. We remain committed to providing innovative, exclusive products to GNC franchisees. We are also exploring opportunities for growth in new channels. Moreover, our new relationship with BBVA Compass Bank has provided both stability and improved access to capital. Subsequent to year-end, the Company successfully employed its new facility with BBVA to repay all outstanding obligations to US Bank, leaving the Company debt-free," concluded Mr. Judd.


About FitLife Brands FitLife Brands is a marketer and manufacturer of innovative and proprietary nutritional supplements for health-conscious consumers. FitLife markets approximately 80 different dietary supplements to promote sports nutrition, improved performance, weight loss and general health primarily through domestic and international GNC® franchise locations. FitLife is headquartered in Omaha, Nebraska. For more information, please visit our new website at www.fitlifebrands.com.


Forward-Looking Statement Statements in this release that are forward looking involve known and unknown risks and uncertainties, which may cause the Company's actual results in future periods to be materially different from any future performance that may be suggested in this news release. Such factors may include, but are not limited to, the Company's ability to grow revenue and the Company's ability to continue to achieve positive cash flow given the Company's existing and anticipated operating and other costs. Many of these risks and uncertainties are beyond the Company's control. Reference is made to the discussion of risk factors detailed in the Company's filings with the Securities and Exchange Commission including its reports on Form 10-K and 10-Q. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the dates on which they are made.


Non-GAAP Financial Measures This press release includes the following financial measures defined as "non-GAAP financial measures" by the Securities and Exchange Commission, specifically non-GAAP EBITDA. This measure may be different from non-GAAP financial measures used by other companies. The presentation of this financial information, which is not prepared under any comprehensive set of accounting rules or principles, is not intended to be considered in isolation or as a substitute for the financial information prepared and presented in accordance with generally accepted accounting principles.


Non-GAAP EBITDA items such as interest, taxes, reversal of existing deferred tax asset amounts, depreciation, amortization, impairment charges, allowance for doubtful accounts, non-cash stock-based compensation and other non-cash charges and other charges deemed non-recurring by management. The Company believes the non-GAAP measure provides useful information to both management and investors by excluding certain expenses which may not be indicative of its core operation results and business outlook.


http://ir.fitlifebrands.com/profiles/investor/ResLibraryView.asp?ResLibraryID=87411&GoTopage=1&Category=2139&BzID=2232&G=861

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