SOURCE: Medical Nutrition USA, Inc.

Medical Nutrition USA, Inc.

December 03, 2009 08:30 ET

Medical Nutrition USA, Inc. Reports 25% Increase in Third Quarter Branded Product Sales

ENGLEWOOD, NJ--(Marketwire - December 3, 2009) - Medical Nutrition USA, Inc. (NASDAQ: MDNU) today announced financial results for the three- and nine-months ended Oct. 31, 2009.

Third Quarter Fiscal 2010 vs. 2009

--  Branded product sales increased 25% to $3,815,500 from $3,048,000;
--  Total sales increased 18% percent to $4,054,700 from $3,426,700 on
    higher branded product sales offset by lower non-branded product sales.
--  Gross profit increased to $2,229,900 or 55% of sales, from $1,812,000
    or 53% of sales;
--  Selling, general and administrative expenses decreased to $1,817,400
    or 45% of sales, compared to $1,899,600 or 55% of sales.
--  Net cash provided by operating activities was $858,800 compared to
    $492,200 in the same quarter a year ago. The increase is due primarily to
    increased sales performance in the quarter.
--  Net income was $284,800 or $0.02 per share compared to a net loss of
    $50,900 or $(0.00) per share; and
--  Balance sheet remained strong with approximately $10.8 million in cash
    and short term investments and no debt.
    

Nine-months ended October 31 Fiscal 2010 vs. 2009

--  Branded product sales increased 19% to $10,727,400 from $9,043,100;
--  Total sales increased 15% to $11,606,500 from $10,063,200, on higher
    branded product sales offset by lower non-branded product sales;
--  Gross profit increased to $6,218,900, or 54% of sales from $5,345,400
    or 53% of sales;
--  Selling, general & administrative expenses decreased to $5,813,600 or
    50% of sales compared to $5,950,300 or 59% of sales;
--  Net cash provided by operating activities was $1,225,200 compared to
    $995,900. The increase is primarily driven by increased sales and resulting
    margin, offset by a tax refund received in Q1 of fiscal 2009;
--  Net income was $265,900 or $ 0.02 per share compared to a net loss of
    $356,000 or $(0.03) per share.
    

"We are pleased to report another strong quarter in which branded product sales growth exceeded 20%, gross margins increased nicely, and selling, general and administrative costs decreased as a percentage of sales," Frank A. Newman, Medical Nutrition's Chairman and Chief Executive Officer, said. "Our solid performance reflects increased usage across all branded product lines as well as greater penetration of the nursing home, hospital and dialysis markets.

"Our strategy to invest in an expanded sales force, continuous product improvement and new product development is clearly working. We continue to receive excellent support from clinicians and the new products we have introduced over the last couple of years are starting to make a material contribution to sales."

Just recently, Medical Nutrition created another new product category with its introduction of Diff-Stat™, which aids in the prevention of antibiotic associated diarrhea and C-diff, two potentially serious health risks affecting many elderly, nursing home residents. Diff-Stat™ continues Medical Nutrition's track record of developing solutions for the most costly and widespread ailments affecting long-term care residents.

"Our new product pipeline remains robust and will be a key contributor to our future growth," Mr. Newman said.

Conference call

Management will host a webcast and conference call at 11:00 a.m. EST today to discuss these results, recent activities, corporate news and Company strategy. A live webcast of the conference call can be accessed through the company's web site at: http://ir.medicalnutritionusa.com/events.cfm. The live conference call dial-in number is: (866) 639-9991 (United States and Canada) or (678) 302-3571 (international callers); ask the operator to connect you to the Medical Nutrition USA Investor Call.

An archive of the webcast with audio can be accessed through the same link above. An audio-only replay of the call will be available following the conference call by dialing (866) 510-4862 (United States and Canada) or (678) 302-3562 (international callers) and entering the code, 4804300# followed by 4 and the following confirmation code: 200911245103633#. The audio-only replay will be available through Saturday, Dec. 5.

About Medical Nutrition USA, Inc.

Medical Nutrition USA develops and distributes products for the nutritionally at risk who are under medical supervision. Its products are used primarily in long-term care facilities, hospitals, dialysis clinics and bariatric clinics. The Company's product lines include Pro-Stat®, Fiber-Stat®, UTI-Stat™ and Diff-Stat™ as well as private label products. Additional information is available at www.mdnu.com.

This news release contains forward-looking statements that are subject to certain risks and uncertainties. Although we believe that the expectations reflected in any of our forward-looking statements are reasonable, actual results could differ materially from those projected or assumed. Risks and uncertainties that could cause or contribute to such material difference include, but are not limited to, general economic conditions, changes in customer demand, changes in trends in the nursing home, renal care, health food and bariatric surgery markets, changes in competitive pricing for products, and the impact of our competitors' new product introductions. Our future financial condition and results of operations, as well as any forward-looking statements are subject to change and inherent risk and uncertainties. Other important factors that may cause actual results to differ materially from those expressed in forward-looking statements are contained in the Medical Nutrition USA, Inc. Annual Report on Form 10-K for the year ended January 31, 2009 as filed with the Securities and Exchange Commission on April 24, 2009 and Form 10-Q for the quarter ended July 31, 2009 filed on Sept. 11, 2009.

                       MEDICAL NUTRITION USA, INC.
                        CONDENSED BALANCE SHEETS


                                                  Oct 31,     January 31,
                                                ------------  ------------
                                                    2009          2009
                                                ------------  ------------
                     ASSETS                     (unaudited)

Current assets:
                  Cash and cash equivalents     $  3,797,000  $  9,654,300
                  Short-term investments           7,016,100             -
                  Accounts receivable, net of
                   allowance of $49,200 and
                   $65,600 respectively            1,455,000     1,377,400
                  Inventories                        535,800       510,600
                  Deferred income taxes              364,000       406,500
                  Prepaid income taxes                     -         8,300
                  Other current assets                60,200       191,900
                                                ------------  ------------

                     Total current assets         13,228,100    12,149,000


Fixed assets, net of accumulated depreciation
 and amortization of $440,900 and $345,400
 respectively                                        281,900       318,800

Other assets
                  Deferred income taxes              785,800       969,000
                  Security deposits                   15,300        15,300
                  Investments in Organics
                   Corporation of America            125,000       125,000
                  Intangible assets, net of
                   amortization                      249,200       276,800
                                                ------------  ------------

                     Total assets               $ 14,685,300  $ 13,853,900
                                                ============  ============


       LIABILITIES AND STOCKHOLDERS' EQUITY

Current Liabilities:
                  Accounts payable              $    545,300  $    530,700
                  Accrued expenses                   976,300       967,600
                  Income taxes payable                40,500             -
                  Accrued rebates                     54,200        73,700
                                                ------------  ------------

                     Total current liabilities     1,616,300     1,572,000
                                                ------------  ------------

Stockholders' equity
                  Preferred stock - $0.001 par
                   value;  5,000,000 shares
                   authorized; no shares
                   outstanding at October 31,
                   2009 and January 31, 2009
                  Common stock - $0.001 par
                   value;  20,000,000 shares
                   authorized; 14,198,614 and
                   14,128,614 shares issued
                   at October 31, 2009 and
                   January 31, 2009,
                   respectively                       14,200        14,100
                  Additional paid-in-capital      25,590,200    25,067,600
                  Accumulated deficit            (12,232,000)  (12,497,900)
                  Less treasury stock, at cost,
                   100,148 and 98,080 shares,
                   respectively                     (303,400)     (301,900)
                                                ------------  ------------
                     Total stockholders' equity   13,069,000    12,281,900
                                                ------------  ------------

                     Total liabilities and
                      stockholders' equity      $ 14,685,300  $ 13,853,900
                                                ============  ============




                         MEDICAL NUTRITION USA, INC.
                     CONDENSED STATEMENTS OF OPERATIONS


                        Nine Months Ended           Three Months Ended
                            October 31,                 October 31,
                    --------------------------- ---------------------------
                        2009          2008          2009          2008
                    ------------- ------------  ------------- ------------
                      (unaudited)  (unaudited)    (unaudited)  (unaudited)
Sales               $  11,606,500 $ 10,063,200  $   4,054,700 $  3,426,700
Cost of sales           5,387,600    4,717,800      1,824,800    1,614,700

                    ------------- ------------  ------------- ------------
Gross profit            6,218,900    5,345,400      2,229,900    1,812,000

Selling, general
 and administrative
 expenses               5,616,000    5,898,800      1,797,600    1,899,600

Research and
 development
 expenses                 197,600       51,500         19,800            -

                    ------------- ------------  ------------- ------------
Operating income
 (loss)                   405,300     (604,900)       412,500      (87,600)

Interest income           134,700      184,900         56,700       63,100
                    ------------- ------------  ------------- ------------

Income (loss)
 before income
 taxes                    540,000     (420,000)       469,200      (24,500)

Income tax expense
 (benefit)                274,100      (64,000)       184,400       26,400
                    ------------- ------------  ------------- ------------

Net income (loss)   $     265,900 $   (356,000) $     284,800 $    (50,900)
                    ============= ============  ============= ============

Earnings (loss) per
 common share

Basic               $        0.02 $      (0.03) $        0.02 $      (0.00)
                    ============= ============  ============= ============

Diluted             $        0.02 $      (0.03) $        0.02 $      (0.00)
                    ============= ============  ============= ============

Weighted average
 common shares
 outstanding

Basic                  13,945,485   13,898,967     13,945,682   13,834,616
                    ------------- ------------  ------------- ------------

Diluted                14,038,353   13,898,967     14,167,165   13,834,616
                    ------------- ------------  ------------- ------------

Contact Information

  • Contacts:
    Medical Nutrition USA, Inc.
    Frank J. Kimmerling
    Vice President/CFO
    800.221.0308
    Email Contact

    Investor Relations
    Adam Friedman
    212.981.2529 x18
    Email Contact