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The Company's third quarter results were impacted by the hurricanes in Florida, which resulted in the temporary closure of Medifast's corporately owned Hi-Energy Clinics in Florida, Mississippi and Arkansas and affected approximately 20% of the clinics which the Company licenses to third parties in the southeastern United States. The clinics have subsequently resumed business operations, but many of the marketing initiatives in the area were delayed by two months. Medifast has filed a claim for business interruption insurance and believes that it will be eligible to recover a portion of the lost income. The timing surrounding the receipt of such insurance payments is uncertain. The Company believes that its losses from the hurricanes in the area exceeded $250,000 in revenue. Despite the closures of the facilities, Medifast still incurred many of the operating expenses during the period, which were fixed.
Medifast expects to release its third quarter financial results in early November, when it anticipates updating its financial expectations for the balance of the year and providing guidance for 2005.
This release contains forward-looking statements, which may involve known, and unknown risks, uncertainties and other factors that may cause Medifast's actual results and performance in future periods to be materially different from any future results or performance suggested by these statements. Medifast cautions investors not to place undue reliance on forward-looking statements, which speak only to management's expectation on this date.
SOURCE: Medifast, Inc.
CONTACT: Jeremy Hunt, Investor Relations Specialist, +1-410-504-8196, or
Casey Seward, Public Relations Manager, +1-410-504-8154, both of Medifast, or
Ken Sgro, CEOcast, Inc. for Medifast, +1-212-732-4300
Web site: http://www.medifastdiet.com/