Press Releases
Every day, more lives are transformed all over the world – one healthy habit at a time. Read the latest about how Medifast and the OPTAVIA® movement is impacting people’s lives.
Medifast, Inc.
For the six months ended June 30, 2005, Medifast had revenue of $18.8 million, representing a 33% increase compared to $14.2 million reported for the six-month period ending June 30, 2004. Income from Operations was $2,066,000, an increase of 9% compared to $1,901,000 for the 2004 six-month period. The company reported net income of $1,260,000, or $0.10 per basic share ($0.10 per diluted share), versus $1,321,000, or $0.12 per basic share ($0.11 per diluted share).
The Company had stockholders' equity of $20.6 million and working capital of $8.9 million on June 30, 2005, compared with $18.4 million and $10.5 million at June 30, 2004, respectively. The second quarter marked the Company's 23rd consecutive quarter of profitability.
"Our significant second quarter results are primarily attributable to our direct marketing campaign consisting of print, radio, mail, web, and television advertising driving new customers to our http://www.medifastdiet.com/ website and call center. The continued revenue growth in our Take Shape for Life Health Advisor Programs and the significant progress in developing our Hi-Energy Clinic model also contributed to this quarter's success," said Bradley T. MacDonald, Medifast Executive Chairman.
"During the first half of 2005 Medifast has taken several initiatives that assisted in both lowering customer acquisition costs and improving customer retention. We have improved our ability to better support our customers which has proven valuable to a customer's weight loss process and improved retention rates," said Michael S. McDevitt, Medifast's President.
Other highlights of the second quarter include:
-- Final study results from the Johns Hopkins Bloomberg School of Public
Health 86-week diabetic weight loss study were released on June 13.
The study found that participants using Medifast's portion-controlled,
meal replacement program lost twice as much weight and were twice as
likely to complete the study as participants following a standard food
diet based on the dietary guidelines of the American Diabetes
Association (ADA). Additionally 24% of the Medifast users decreased
or eliminated their diabetes medication, compared to 0% on the
standard food diet.
-- Medifast announced that it had entered into an agreement with DrugMax,
Inc.
For the third quarter, the Company expects to report revenue of $9.7 to $10.0 million and to generate pre-tax profit of $900,000 to $1.0 million, or $0.07 to $0.08 per diluted share. The company expects to generate revenue of $34.5 million to $36.5 million for the year with a pretax profit of $0.26 to $0.30 per diluted share.
The company's executives will hold a conference call to discuss second quarter financial results. The call will take place at 5:00 pm, Eastern Time today. Interested participants should call (800) 638-5439 when calling within the United States or (617) 614-3945 when calling internationally. Please refer to pass code 83796445. There will be a playback available. To listen to the playback, please call 888-286-8010 when calling within the United States or 617-801-6888 when calling internationally. Please use pass code 88602134 for the replay. The replay will be available until November 9, 2005.
The webcast may be accessed via the Company's website at http://www.medifastdiet.com/. Interested parties should go to the section marked "Investor Relations" to listen to the call. The webcast can be accessed until November 9, 2005.
About Medifast: (http://www.medifastdiet.com/)
Medifast has been helping people lose weight and achieve better health for 25 years. Its meal replacement foods have been proven effective at Johns Hopkins University, recommended by over 15,000 physicians and used by more than 1,000,000 customers. Medifast offers its customers world-class customer service, nutrition and medical support.
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.
MEDIFAST, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
June 30, 2005 December 31, 2004
(Unaudited) (Audited)
ASSETS
Current assets:
Cash $1,229,000 $612,000
Accounts receivable - net of
allowance for doubtful
accounts of $55,000 1,137,000 1,063,000
Inventory 4,490,000 4,251,000
Investment securities 3,050,000 2,626,000
Deferred compensation 486,000 321,000
Prepaid expenses and other
current assets 1,480,000 1,079,000
Deferred tax asset 24,000 19,000
Total Current Assets 11,896,000 9,971,000
Property, plant and equipment - net 8,893,000 8,698,000
Trademarks and intangibles, net 6,733,000 7,138,000
Deferred tax asset, net of current
position 158,000 91,000
Other assets 59,000 70,000
TOTAL ASSETS $27,739,000 $25,968,000
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable and accrued expenses $1,382,000 $940,000
Income taxes payable 221,000 674,000
Dividends payable 65,000 65,000
Line of credit 651,000 369,000
Current maturities of long-term debt 586,000 458,000
Total current liabilities 2,905,000 2,506,000
Long-term debt, net of current
portion 4,232,000 4,256,000
Total Liabilities 7,137,000 6,762,000
Stockholders' Equity:
Series B Convertible Preferred Stock;
par value $1.00; 600,000 shares
authorized; 0 and 300,614 shares
issued and outstanding - 301,000
Series C Convertible Preferred Stock;
stated value $1.00; 1,015,000 shares
authorized; 200,000 shares issued
and outstanding, respectively 200,000 200,000
Common stock; par value $.001 per share;
15,000,000 authorized; 12,174,345 and
11,001,070 shares issued and
outstanding respectively 12,000 11,000
Additional paid-in capital 21,229,000 20,556,000
Accumulated comprehensive loss 4,000 (39,000)
Accumulated deficit (307,000) (1,287,000)
21,138,000 19,742,000
Less cost of common stock treasury;
88,500 and 83,863 shares, respectively (536,000) (536,000)
Total Stockholders' Equity 20,602,000 19,206,000
TOTAL LIABILITIES &
STOCKHOLDERS' EQUITY $27,739,000 $25,968,000
MEDIFAST, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
Six Months Ended Three Months Ended
June 30, June 30,
2005 2004 2005 2004
(Unaudited) (Unaudited) (Unaudited) (Unaudited)
Revenue $18,881,000 $14,174,000 $10,555,000 $7,357,000
Cost of sales 4,696,000 3,296,000 2,623,000 1,946,000
Gross Profit 14,185,000 10,878,000 7,932,000 5,411,000
Selling, general,
and administration 12,119,000 8,977,000 6,778,000 4,429,000
Income from operations 2,066,000 1,901,000 1,154,000 982,000
Other income/(expense)
Interest expense (148,000) (75,000) (83,000) (52,000)
Interest income 97,000 69,000
Other income (expense) 3,000 (7,000) 24,000 (5,000)
Income before provision
for income taxes 2,018,000 1,819,000 1,164,000 925,000
Provision for income tax
benefit (expense) (758,000) (498,000) (411,000) (251,000)
Net income 1,260,000 1,321,000 753,000 674,000
Less: Stock dividend
on preferred stock - 18,000 - 18,000
Net income attributable
to common
shareholders 1,260,000 $1,303,000 753,000 $656,000
Basic earnings per share $0.10 $0.12 $0.06 $0.06
Diluted earnings per share $0.10 $0.11 $0.06 $0.06
Weighted average shares
outstanding -
Basic 12,173,456 10,670,706 12,173,456 10,731,021
Diluted 12,858,777 12,014,833 12,994,764 12,176,819
SOURCE: Medifast, Inc.
CONTACT: Jeremy Hunt, Investor Relations Specialist, Medifast, Inc.,
+1-410-504-8196
Web site: http://www.medifastdiet.com/