FitLife Brands Announces Third Quarter 2020 Results

Omaha, Nov. 12, 2020 (GLOBE NEWSWIRE) — OMAHA, NE – November 12, 2020 — FitLife Brands, Inc. (“FitLife” or the “Company”) (OTC Pink: FTLF), an international provider of innovative and proprietary nutritional supplements for health-conscious consumers marketed under the brand names NDS Nutrition™, PMD®, SirenLabs®, CoreActive®, Metis Nutrition™, iSatori™, Energize, and BioGenetic Laboratories, today announced results for the three and nine months ended September 30, 2020.
Highlights for the third quarter ended September 30, 2020 include:Total revenue increased 30% to $6.9 million compared to $5.3 million in the same quarter last year.Direct-to-consumer online sales increased 96% to $1.2 million, representing 17% of total revenue compared to 12% in the same quarter last year.Gross profit increased 27% to $2.9 million.Operating expenses declined 13% to $1.2 million.The Company generated net income of $1.6 million compared to $0.9 million during the same quarter last year, an increase of 85%. Net income per share increased to $1.55 per share, or $1.45 per diluted share, compared to $0.87 per share, or $0.72 per diluted share, in the same quarter last year.The Company ended the quarter with $4.1 million of cash, compared to $0.3 million as of December 31, 2019.  Subsequent to the end of the quarter, the Company received a payment of $0.8 million from GNC in full satisfaction of the Company’s administrative claim related to GNC’s bankruptcy filing.For the third quarter ended September 30, 2020, total revenue was $6.9 million compared to $5.3 million in the same quarter last year, an increase of 30.2%.  The increase was primarily attributable to continued strong growth in our direct-to-consumer online sales and a restocking of our products at GNC following its bankruptcy filing.  For the third quarter of 2020, online sales increased 96% to $1.2 million and accounted for approximately 17% of the Company’s revenue compared to 12% during the third quarter of 2019.Gross profit increased to $2.9 million, an increase of 27.0% from the third quarter of 2019.  Gross margin decreased slightly from 42.4% to 41.3% over the same time period.  During the quarter, total operating expenses declined 12.7% to $1.2 million.Net income for the third quarter of 2020 was $1.6 million compared to net income of $0.9 million during the same quarter in 2019.  The Company delivered basic earnings per share of $1.55 in the third quarter of 2020 compared to $0.87 in the same quarter last year, an increase of 78.2%.  Diluted earnings per share for the quarter more than doubled to $1.45 compared to $0.72 in the third quarter of last year.GNC BankruptcyThe Company’s largest customer, GNC, filed for Chapter 11 bankruptcy protection on June 23, 2020.  At the time of the filing, GNC owed the Company approximately $1.2 million.Under US bankruptcy law, payment for product received by a customer in the 20 days preceding a bankruptcy filing is eligible for a priority administrative claim under Section 503(b)(9) of the US Bankruptcy Code.  Generally, as long as the debtor company successfully emerges from Chapter 11, those claims are paid in full around the time the debtor emerges from bankruptcy.  Claims associated with product received more than 20 days pre-petition are typically considered general unsecured claims and are subject to impairment through the bankruptcy process.The majority of the Company’s receivables from GNC as of the petition date related to product that was delivered in the 20 days leading up to the bankruptcy filing.  Subsequent to the end of the third quarter, the Company received payment of approximately $829,000 from GNC in full settlement of Company’s administrative claim. The remaining receivables of approximately $354,000 relating to product delivered to GNC more than 20 days prior to its bankruptcy filing were fully reserved by the Company during the second quarter of 2020.  The Company expects to receive an immaterial partial recovery on these receivables during the fourth quarter.  Subsequent to the end of the quarter, GNC’s Plan of Reorganization was confirmed by the Bankruptcy Court, and the Plan became effective on October 30, 2020.Dayton Judd, the Company’s Chairman and CEO, commented “The third quarter was one of the strongest in the Company’s history.  I am proud of our team and the results they generated in a difficult retail environment.  While the fourth quarter is traditionally our slowest, we continue to see increasing demand for our products online and in GNC franchise locations.  And in addition to growing organically, we continue to look for opportunities to grow through prudent, accretive acquisitions.”About FitLife Brands
FitLife Brands is a developer and marketer of innovative and proprietary nutritional supplements for health-conscious consumers.  FitLife markets over 80 different dietary supplements to promote sports nutrition, improved performance, weight loss and general health primarily through domestic and international GNC® franchise locations as well as through more than 25,000 additional domestic retail locations and, increasingly, online.  FitLife is headquartered in Omaha, Nebraska.  For more information please visit our new website at www.fitlifebrands.com.Forward-Looking Statements
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 ability to of the Company to continue 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. 
 
 
Dayton Judd
djudd@fitlifebrands.com