Natrol (NASDAQ:NTOL)
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Natrol, Inc. (Nasdaq:NTOL), a leading manufacturer and marketer of
nationally branded nutritional products, announced that it has acquired
Medical Research Institute (MRI). MRI, founded in 1997, supplies
high-quality sports nutrition products, such as CE2®,
NO2®, Pro-Nos™
and Anabolic Switch™, which are primarily
designed to enhance work-out performance. The MRI brand carries a
premier position in the sports nutrition market. The brand identity is
underpinned by a reputation for innovative science. Notably, MRI was the
first company to launch nitric oxide based products in the sports
nutrition market. MRI's products are primarily distributed through GNC.
The acquisition provides for an initial purchase price of $8.0 million
in cash, and allows for potential earn-out payments based upon the
achievement of certain levels of EBIT (earnings before interest and
taxes) over the next three years. The Company noted that, at present,
MRI has working capital of approximately $8.6 million including cash of
approximately $4.0 million and no debt. In 2006, MRI recorded revenue of
approximately $21.4 million with operating income of $3.1 million. It is
expected that the transaction will be immediately accretive. In the last
7 months, MRI has launched a range of new leading edge products to the
market.
Wayne Bos, Natrol’s President and CEO,
commented, “We are extremely excited about
this opportunity as we continue in our quest to become a diversified
supplier of nutritional supplements. MRI has unique intellectual
property and an excellent, but somewhat underdeveloped strategic
position in this market. We believe that we can help grow the business
by improving manufacturing and logistics capabilities, expanding into
new geographic markets, and extending the MRI product lines.”
Ed Byrd, the founder and principal shareholder of MRI, has a track
record in building highly successful businesses in the sports nutrition
market and was a founder of EAS, one of the most successful sports
nutrition companies. Mr. Byrd will continue to serve as MRI's Chairman
and Head of Research and Development. He commented, “We
believe that the combination of MRI and Natrol will prove to be
formidable. Our strong existing product mix and ongoing R&D effort will
complement Natrol well and we believe that their well-developed
operating infrastructure and developing global distribution capabilities
will enhance our ability to grow. We are pleased to join their team and
make our combined vision a reality.”
Mr. Bos concluded, “We are pleased to have
quickly identified and executed such a strong transaction with the
capital we unlocked through the recent sale and leaseback of our
corporate facilities. This acquisition will help accelerate our
corporate development plan by creating scale, synergies, and new avenues
for growth. We are especially excited to deepen an already talented
management team, to continue to expand our portfolio of intellectual
property, and to significantly reinforce our commitment to and
capability for research and development. We believe this deal marks the
onset of a new phase of our turnaround and are excited to demonstrate
our capabilities to our investors.”
About Natrol – Nourishing the Potential
of Mind and BodySM
Natrol, Inc. (Nasdaq:NTOL), headquartered in Chatsworth, CA, has a
portfolio of health and wellness brands representing quality nutritional
supplements, functional herbal teas, and sports nutrition products.
Established in 1980, Natrol’s portfolio of
brands includes: Natrol®,
Prolab®, Laci Le Beau®,
Promensil®, Trinovin®,
Nu Hair® and Shen Min®.
The company also manufactures supplements for its own brands and on
behalf of third parties.
Natrol distributes products nationally through more than 54,000
retailers, as well as internationally in over 40 other countries through
distribution partners and subsidiaries in the UK and Hong Kong. Natrol’s
dedication to quality is evidenced by its commitment to high
manufacturing standards, earning the company an “A”
rating from the Natural Products Association's Good Manufacturing
Practices (“GMP”)
Certification Program—a designation achieved
by less than ten percent of U.S. nutrition companies. For more
information, visit www.Natrol.com.
The statements made in this press release which are not historical
facts, including statements regarding expectations for future growth of
revenue and profits and trends concerning net sales, are forward-looking
statements within the meaning of Section 27A of the Securities Act of
1933 and Section 21E of the Securities Exchange Act of 1934. As a result
of a number of factors, our actual results could differ materially from
those set forth in the forward-looking statements. Certain factors that
might cause our actual results to differ materially from those in the
forward-looking statements include, without limitation: (i) our ability
to develop and execute our business plans, (ii) our ability to respond
to competitive challenges and changing consumer preferences, (iii) our
ability to consummate and integrate acquisitions, (iv) increased
competition, (v) unfavorable publicity about dietary supplements in
general or regarding our products or similar products sold by others,
(vi) our exposure to product liability claims, our dependence upon
certain large customers, and (vii) our ability to retain and attract
talented management and other key employees, as well as those factors
set forth under the heading "Risk Factors" in our annual report on Form
10-K for the year ended December 31, 2006, and in our other filings with
the Securities and Exchange Commission.
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