SOURCE: PacificHealth Laboratories, Inc.

PacificHealth Laboratories, Inc.

May 04, 2011 09:00 ET

PacificHealth Laboratories Reports First Quarter Profit

MATAWAN, NJ--(Marketwire - May 4, 2011) - PacificHealth Laboratories, Inc. (OTCQB: PHLI), a leading nutrition company, today reported a profit of $27,230, or $0.00 per share, for the first quarter ended March 31, 2011 versus a net loss of ($269,230), or ($0.02) per share, for the same period in 2010.

Revenue increased to $1,731,611 in the first quarter of 2011 from $1,650,265 for the same period in 2010. The sports performance portion of our business increased approximately $160,000, or 10%. General and administrative expenses decreased approximately $237,000 in the quarter ended March 31, 2011 as compared to the same period in 2010.

Fred Duffner, President and CEO of PacificHealth Laboratories said, "I am extremely pleased with the first quarter results. Net income would have been even higher as it still included a small amount of restructuring costs from 2010. To place our results in perspective, the last time the Company showed an operating profit in the first quarter was seven years ago. First quarter revenue does not include any substantial sales of our two new products, 2ND SURGE® and ACCEL RECOVER™, which officially launched beginning April 1."

Mr. Duffner continued, "On April 1, our new advertising campaign broke with multipage ads in leading triathlete, cycling and running magazines. Dealer receptivity has been excellent. ACCEL RECOVER and 2ND SURGE are now carried by every leading bike distributor and the products are now sold in over 100 of the largest independent dealers plus chain retailers including Performance Bike, Academy, Fleet Feet, Luke's Locker and Sports Basement. Consumer response has been equally positive. Endurance athletes have been tweeting, emailing and posting on Facebook how these products truly make a difference in their performance."

Mr. Duffner concluded, "In April we entered into a sponsorship agreement with Jeff Galloway, one of the true legends in distance running. Jeff, a long time advocate of our products, will be a valuable resource in getting the word out for our existing and new products to the running community. Finally, one of our key initiatives this year was to increase the effectiveness of our website. Preliminary data reveals that this is working. For example average time spent on our web site is up over 250%. First quarter results are right on track."

About PacificHealth Laboratories. Inc.

PacificHealth Laboratories, Inc. (OTCQB: PHLI), a leading nutrition technology company, has been a pioneer in discovering, developing and commercializing patented, protein-based nutritional products that stimulate specific peptides involved in appetite regulation and that activate biochemical pathways involved in muscle performance and growth. PHLI's principal areas of focus include sports performance and weight loss. To learn more, visit www.pacifichealthlabs.com.

Notice: This news release and oral statements made from time to time by Company representatives concerning the same subject matter may contain so-called "forward-looking statements". These statements can be identified by introductory words such as "expects", "plans", "will", "estimates", "forecasts", "projects" or words of similar meaning and by the fact they do not relate strictly to historical or current facts. Forward-looking statements frequently are used in discussing new products and their potential. Many factors may cause actual results to differ from forward-looking statements, including inaccurate assumptions and a broad variety of risks and uncertainties, some of which are known, such general economic conditions, consumer product acceptance and competitive products, and others of which are not. No forward-looking statements are a guarantee of future results or events, and one should avoid placing undue reliance on such statements.

SELECTED FINANCIAL DATA:

                     PACIFICHEALTH LABORATORIES, INC.                      
                         STATEMENTS OF OPERATIONS
            FOR THE THREE MONTHS ENDED MARCH 31, 2011 AND 2010
                                (UNAUDITED)


                                                        Three Months
                                                       Ended March 31,
                                                      2011         2010
                                                  -----------  -----------
Revenues:
  Net product sales                               $ 1,731,611  $ 1,650,265

Cost of goods sold                                    960,992      909,379
                                                  -----------  -----------

Gross profit                                          770,619      740,886
                                                  -----------  -----------

Operating expenses:
  Sales and marketing                                 190,431      235,085
  General and administrative (Includes related
   party consulting of $43,000 and $0,
   respectively)                                      536,984      774,150
  Research and development                             14,817            -
                                                  -----------  -----------
                                                      742,232    1,009,235
                                                  -----------  -----------

Income (loss) before other (expense) income and
 provision for income taxes                            28,387     (268,349)
                                                  -----------  -----------

Other (expense) income:
 Other income                                           2,100            -
 Interest income                                          152          228
 Interest expense                                      (3,409)      (1,109)
                                                  -----------  -----------
                                                       (1,157)        (881)
                                                  -----------  -----------

Income (loss) before provision for income taxes        27,230     (269,230)

Provision for income taxes                                  -            -
                                                  -----------  -----------

Net income (loss)                                 $    27,230  $  (269,230)
                                                  ===========  ===========

Basic income (loss) per share                     $      0.00  $     (0.02)
                                                  ===========  ===========

Diluted income (loss) per share                   $      0.00  $     (0.02)
                                                  ===========  ===========

Weighted average common shares - basic             16,665,257   15,684,010
                                                  ===========  ===========

Weighted average common shares - diluted           16,833,590   15,684,010
                                                  ===========  ===========




                     PACIFICHEALTH LABORATORIES, INC.
                              BALANCE SHEETS

                                 ASSETS

                                                   March 31,   December 31,
                                                      2011         2010
                                                  (Unaudited)
                                                  -----------  -----------
Current assets:
  Cash and cash equivalents                       $   677,759  $   134,165
  Other short-term investments                        125,000      150,000
  Accounts receivable, net                            763,036      416,722
  Inventories, net                                    537,897      596,317
  Prepaid expenses                                     80,169       64,780
                                                  -----------  -----------
    Total current assets                            2,183,861    1,361,984

Property and equipment, net                            41,254       52,531

Deposits                                               10,895       10,895
                                                  -----------  -----------

      Total assets                                $ 2,236,010  $ 1,425,410
                                                  ===========  ===========

                    LIABILITIES AND STOCKHOLDERS' EQUITY

Current liabilities:
  Line of credit                                  $    62,500  $    75,000
  Notes payable                                         3,213       20,670
  Accounts payable and accrued expenses (Includes
   related party of $43,000 and $11,000,
   respectively)                                    1,058,924      713,184
  Deferred revenue                                     62,022       60,836
                                                  -----------  -----------
    Total current liabilities                       1,186,659      869,690
                                                  -----------  -----------

Stockholders' equity:
  Common stock, $.0025 par value; authorized
   50,000,000 shares; issued and outstanding:
   18,285,257 and 16,485,257 shares,
   respectively                                        45,713       41,213
  Additional paid-in capital                       20,624,870   20,162,969
  Accumulated deficit                             (19,621,232) (19,648,462)
                                                  -----------  -----------

                                                    1,049,351      555,720
                                                  -----------  -----------

      Total liabilities and stockholders'equity   $ 2,236,010  $ 1,425,410
                                                  ===========  ===========

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