NBTY Inc. (NTY, Financial) filed Quarterly Report for the period ended 2009-06-30.
NBTY INC. collectively with its subsidiaries is a manufacturer and marketer of nutritional supplements in the United States. It sells more than 350 products consisting of vitamins and other nutritional supplements such as minerals amino acids and herbs. NBTY Inc. has a market cap of $2.23 billion; its shares were traded at around $36 with a P/E ratio of 19.5 and P/S ratio of 1.1. NBTY Inc. had an annual average earning growth of 16.4% over the past 10 years. GuruFocus rated NBTY Inc. the business predictability rank of 5-star.
To manage the potential risk arising from changing interest rates and their impact on long-term debt, our policy is to maintain a combination of available fixed and variable rate financial instruments. We are exposed to changes in interest rates on our floating rate $325,000 revolving credit facility, our multicurrency term facility, and our Term Loan. With respect to the interest on the Term Loan, in August 2008, we entered into two interest rate swap contracts, each with a notional amount of $100 million. Under the terms of the swap contracts, variable interest payments will be swapped for fixed interest payments. The interest rate exposure on the multicurrency term facility is mitigated by the interest earned on the cash collateral securing the loan. Therefore, a hypothetical 10% change in interest rates would not have a material effect on our consolidated pretax income or cash flow. At June 30, 2009, there were no borrowings outstanding under our revolving credit facility. Therefore, a hypothetical 10% change in interest rates would not have a material effect on our consolidated pretax income or cash flow.
The 71/8% Senior Subordinated Notes had a fair value at June 30, 2009, based on then quoted market prices, of $177,175. At June 30, 2009, based solely on a hypothetical 10% change in interest rates related to our fixed rate Notes, we estimate that the hypothetical fair value of our fixed rate debt would have changed approximately $5,000. We believe that the carrying value of all of our other financial instruments approximates fair value due to their short maturities and variable interest rates.
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NBTY INC. collectively with its subsidiaries is a manufacturer and marketer of nutritional supplements in the United States. It sells more than 350 products consisting of vitamins and other nutritional supplements such as minerals amino acids and herbs. NBTY Inc. has a market cap of $2.23 billion; its shares were traded at around $36 with a P/E ratio of 19.5 and P/S ratio of 1.1. NBTY Inc. had an annual average earning growth of 16.4% over the past 10 years. GuruFocus rated NBTY Inc. the business predictability rank of 5-star.
Highlight of Business Operations:
The U.S. dollar volume of net sales denominated in foreign currencies was approximately $553,222, or 29.0% of total net sales, for the nine months ended June 30, 2009. A majority of our foreign currency exposure is denominated in the British pound sterling and Canadian dollars. For the nine months ended June 30, 2009, as compared to the prior comparable period, the change in currency rates between British pound sterling and Canadian dollar as compared to the U.S. dollar was a decline of 24% and 17%, respectively, resulting in a decrease of $128,414 and $19,217 in net sales and operating income, respectively. The total impact of all currency fluctuations on net income was a reduction of approximately $0.24 per diluted share for the nine months ended June 30, 2009.To manage the potential risk arising from changing interest rates and their impact on long-term debt, our policy is to maintain a combination of available fixed and variable rate financial instruments. We are exposed to changes in interest rates on our floating rate $325,000 revolving credit facility, our multicurrency term facility, and our Term Loan. With respect to the interest on the Term Loan, in August 2008, we entered into two interest rate swap contracts, each with a notional amount of $100 million. Under the terms of the swap contracts, variable interest payments will be swapped for fixed interest payments. The interest rate exposure on the multicurrency term facility is mitigated by the interest earned on the cash collateral securing the loan. Therefore, a hypothetical 10% change in interest rates would not have a material effect on our consolidated pretax income or cash flow. At June 30, 2009, there were no borrowings outstanding under our revolving credit facility. Therefore, a hypothetical 10% change in interest rates would not have a material effect on our consolidated pretax income or cash flow.
The 71/8% Senior Subordinated Notes had a fair value at June 30, 2009, based on then quoted market prices, of $177,175. At June 30, 2009, based solely on a hypothetical 10% change in interest rates related to our fixed rate Notes, we estimate that the hypothetical fair value of our fixed rate debt would have changed approximately $5,000. We believe that the carrying value of all of our other financial instruments approximates fair value due to their short maturities and variable interest rates.
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