Schiff Nutrition International Inc. Reports Operating Results (10-Q)

Author's Avatar
Apr 14, 2011
Schiff Nutrition International Inc. (WNI, Financial) filed Quarterly Report for the period ended 2011-02-28.

Schiff Nutrition Intl. Inc. has a market cap of $193 million; its shares were traded at around $9.23 with a P/E ratio of 22.5 and P/S ratio of 1. Schiff Nutrition Intl. Inc. had an annual average earning growth of 4% over the past 10 years.

Highlight of Business Operations:

Aggregate branded net sales increased 3.9% to $40.4 million for the fiscal 2011 third quarter, from $38.8 million for the fiscal 2010 third quarter, primarily due to a $1.6 million increase in sales volume. The increase in branded sales volume is primarily attributable to an increase in MegaRed sales due to continued sales growth, substantially offset by a decrease in Move Free sales. Move Free net sales were $15.7 million and $20.3 million, respectively, for the fiscal 2011 and 2010 third quarters. The decline in Move Free net sales is primarily attributable to an overall decline in the joint care category market, together with intense competitive pricing pressures.

Selling and marketing expenses, including sales, marketing, advertising, freight and other costs, decreased to $7.9 million for the fiscal 2011 third quarter, from $8.4 million for the fiscal 2010 third quarter. The decrease primarily resulted from a $0.3 million reduction in promotional expenses, primarily display costs, due to promotional timing considerations and a $0.2 million decrease in selling and marketing overhead due to a reduction in management long-term and annual incentive plan costs. The decrease in management long-term incentive plan costs resulted from the accelerated vesting of awards in the fiscal 2011 second quarter due to the WHF-TPG transaction.

General and administrative expenses increased to $5.6 million for the fiscal 2011 third quarter, from $4.2 million for the fiscal 2010 third quarter, primarily due to $1.9 million in incremental CEO transition expenses, partially offset by a $0.7 million decrease in management and board of director long-term and annual incentive plan costs. The decrease in management and board of director long-term incentive plan costs resulted from the accelerated vesting of awards in the fiscal 2011 second quarter due to the WHF-TPG transaction.

Aggregate branded net sales increased 3.9% to $118.4 million for the nine months ended February 28, 2011, from $114.0 million for the nine months ended February 28, 2010, primarily due to a $11.4 million increase in sales volume, partially offset by an increase in sales promotional incentives classified as sales price reductions. Classification of promotional incentive costs as a reduction from gross sales is required when the promotion effectively represents a sales price decrease. The increase in branded sales volume was primarily attributable to an increase in MegaRed sales due to incremental sales resulting from new distribution into various accounts in the first half of fiscal 2010, as well as continued MegaRed sales growth supported by increases in advertising and sales promotional incentives, partially offset by a decrease in Move Free sales. Move Free net sales were $47.4 million and $57.9 million, respectively, for the nine months ended February 28, 2011 and 2010. The decline in Move Free net sales is primarily attributable to an overall decline in the joint care category market, together with intense competitive pricing pressures and customer inventory reductions.

Selling and marketing expenses, including sales, marketing, advertising, freight and other costs, increased to $26.2 million for the nine months ended February 28, 2011, from $23.9 million for the nine months ended February 28, 2010, primarily due to a $2.7 million increase in advertising and other promotional expenses and a $0.2 million net increase in management long-term and annual incentive plan costs, partially offset by a decrease in freight expense. The increase in management long-term incentive plan costs resulted from the accelerated vesting of awards in the fiscal 2011 second quarter due to the WHF-TPG transaction. The increase in advertising and other promotional expenses primarily resulted from continued support of MegaRed sales growth and the introduction of new products.

General and administrative expenses increased to $16.9 million for the nine months ended February 28, 2011, from $13.3 million for the nine months ended February 28, 2010, primarily due to $1.9 million in incremental CEO trans

Read the The complete Report