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Medifast, Inc.
About Medifast: (www.choosemedifast.com)
Medifast has been helping people lose weight and achieve better health for 25 years. Its meal replacement foods have been proven effective in multiple clinical studies, recommended by over 15,000 physicians and used by more than 1 million customers. Medifast offers its customers world-class customer service and nutrition support.
Please Note: This release contains "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, Section 21E of the Securities Exchange Act of 1934, as amended, and the Private Securities Litigation Reform Act of 1995. These forward-looking statements generally can be identified by use of phrases or terminology such as "intend" or other similar words or the negative of such terminology. Similarly, descriptions of Medifast's objectives, strategies, plans, goals or targets contained herein are also considered forward-looking statements. Medifast believes this release should be read in conjunction with all of its filings with the United States Securities and Exchange Commission and cautions its readers that these forward-looking statements are subject to certain events, risks, uncertainties, and other factors. Some of these factors include, among others, Medifast's inability to attract and retain independent Associates and Members, stability in the pricing of print, TV and Direct Mail marketing initiatives affecting the cost to acquire customers, increases in competition, litigation, regulatory changes, and its planned growth into new domestic and international markets and new channels of distribution. Although Medifast's believes that the expectations, statements, and assumptions reflected in these forward- looking statements are reasonable, it cautions readers to always consider all of the risk factors and any other cautionary statements carefully in evaluating each forward-looking statement in this release, as well as those set forth in its latest Annual Report on Form 10-K and Quarterly Report on Form 10-Q, and other filings filed with the United States Securities and Exchange Commission, including its current reports on Form 8-K. All of the forward-looking statements contained herein speak only as of the date of this release.
MEDIFAST, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited) (Audited)
(Restated)
September 30, 2007 December 31, 2006
ASSETS
Current assets:
Cash and cash equivalents $2,102,000 $1,085,000
Accounts receivable-net of allowance
for doubtful accounts of $100,000 425,000 448,000
Inventory 8,471,000 8,255,000
Investment securities 1,477,000 1,540,000
Deferred compensation 830,000 673,000
Prepaid expenses and other current assets 3,208,000 2,599,000
Note receivable - current 174,000 174,000
Current portion of deferred tax asset 91,000 90,000
Total current assets 16,778,000 14,864,000
Property, plant and equipment - net 16,005,000 14,020,000
Trademarks and intangibles - net 5,749,000 5,874,000
Deferred tax asset, net of current portion 807,000 517,000
Note receivable, net of current assets 1,250,000 1,355,000
Other assets 84,000 47,000
TOTAL ASSETS $40,673,000 $36,677,000
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable and accrued expenses $2,805,000 $2,913,000
Income taxes payable 101,000 535,000
Line of credit - 1,256,000
Current maturities of long-term debt 1,460,000 548,000
Total current liabilities 4,366,000 5,252,000
Other liabilities and deferred credits
Long-term debt, net of current portion 4,615,000 3,509,000
Total liabilities 8,981,000 8,761,000
Stockholders' Equity:
Preferred stock, $.001 par value
(1,500,000 authorized, no shares
issued and outstanding) - -
Common stock; par value $.001 per
share; 20,000,000 shares authorized;
13,709,098 and 13,631,898 shares issued
and outstanding 14,000 14,000
Additional paid-in capital 26,930,000 26,629,000
Accumulated other comprehensive income 367,000 334,000
Retained earnings 9,216,000 5,981,000
36,527,000 32,958,000
Less: cost of 270,534 and 249,184
shares of common stock in treasury (1,971,000) (1,686,000)
Less: Unearned compensation (2,864,000) (3,356,000)
Total stockholders' equity 31,692,000 27,916,000
TOTAL LIABILITIES AND STOCKHOLDERS'
EQUITY $40,673,000 $36,677,000
MEDIFAST, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(Unaudited)
Three Months Ended Nine Months Ended
September 30, September 30,
2007 2006 2007 2006
(Restated) (Restated)
Revenue $21,846,000 $19,642,000 $63,975,000 $58,779,000
Cost of sales 5,523,000 4,705,000 15,944,000 14,334,000
Gross Profit 16,323,000 14,937,000 48,031,000 44,445,000
Selling, general, and
administration 14,766,000 13,166,000 43,116,000 37,362,000
Income from operations 1,557,000 1,771,000 4,915,000 7,083,000
Other income/(expense)
Interest expense, net (159,000) (42,000) (284,000) (134,000)
Other income 2,000 24,000 90,000 184,000
(157,000) (18,000) (194,000) 50,000
Income before provision
for income taxes 1,400,000 1,753,000 4,721,000 7,133,000
Provision for income
tax (expense) (446,000) (298,000) (1,486,000) (2,219,000)
Net income $954,000 $1,455,000 $3,235,000 $4,914,000
Basic earnings per share $0.07 $0.11 $0.25 $0.39
Diluted earnings per
share $0.07 $0.11 $0.24 $0.36
Weighted average shares
outstanding -
Basic 12,982,730 12,767,629 12,939,562 12,657,842
Diluted 13,683,809 13,603,208 13,640,641 13,493,421
First Call Analyst:
FCMN Contact: bgleason@choosemedifast.com
SOURCE: Medifast, Inc.
CONTACT: Brad Porterfield, Investor relations of Medifast, Inc.,
+1-410-504-8166,
Web site: http://www.choosemedifast.com/