MusclePharm Third Quarter Gross Sales Increased 51% to a Record
$31.1 Million
DENVER, CO--(Marketwired - Nov 14, 2013) - MusclePharm
Corporation (OTCQB: MSLP) (the "Company", or "MusclePharm"), a
leading international, award-winning sports nutrition company,
announced today its financial results for the third quarter ended
September 30, 2013 ("Q3 2013").
For Q3 2013, the Company reported record gross sales prior to
accounting for discounts and sales allowances of $31,080,225, an
increase of 51% as compared to $20,627,691 for the third quarter of
2012 ("Q3 2012"). Q3 2013 gross sales grew sequentially by 9% as
compared to Q2 2013. For Q3 2013, the Company reported net
sales of $25,343,968, an increase of 36% as compared to $18,573,726
for Q3 2012. Discounts and sales allowances in Q3 2013
increased to approximately $5.7 million, or 18% of gross sales as
compared to approximately $2.1 million, or 10% of gross sales in Q3
2012. The increase in discounts and sales allowances was largely
attributable to the impact of an aggressive campaign to close-out
inventory of the Company's Assault™ pre-work product in advance of
the launch of its new Assault™ product formulation as well as
promotional discounts on opening orders for the Company's recently
launched Arnold Schwarzenegger Series™ as well as promotional
discounts related to the Company's activities at the 2013 Olympia
Fitness and Performance show.
For Q3 2013, the Company recorded a loss from operations of
($4,872,780) as compared to a loss from operations of ($3,810,813)
in Q3 2012. Included in the Q3 2103 expenses was $4,241,339 million
in non-cash expenses including non-cash, stock-based compensation
expenses of $2,036,301 associated with the amortization of both
certain employee RSUs and RSA agreements and the Company's
endorsement licensing and co-branding agreement with Arnold
Schwarzenegger.
Commenting on the results, Brad Pyatt, MusclePharm's Founder
& CEO, stated, "We continue to add important building blocks in
order to achieve our strategic mission of becoming one of the
world's foremost sports nutrition companies. Highlighted by
our recent agreements with Arnold Schwarzenegger for a new line of
branded products; with Costco, Walgreens, GNC and Europa for new
sales and distribution channels, and with the addition of marketing
veteran Sydney Rollock as CMO; I believe we are extremely well
positioned to continue growing MusclePharm and our line of branded
sports nutrition products."
Recent Company highlights include:
- In September, the Company announced a partnership with Europa
Sports Products, the nation's largest distributor of nutritional
supplements, sports drinks and accessories, to exclusively
distribute MusclePharm's new Arnold Schwarzenegger Series™
across North America. The new product line is a result of a
first-of-its-kind partnership with the Mr. Universe, Mr. World and
Mr. Olympia title holder, actor, entrepreneur and former Governor
of California, Arnold Schwarzenegger. The product line
launched both domestically and internationally at health and
nutrition stores, including GNC stores, as well as online retailers
in late September 2013.
- In October, the Company announced it officially began shipping
its Combat Protein Powder® to all 430 Costco Wholesale U.S.
locations This new distribution channel expands
MusclePharm's reach beyond specialty health, nutrition and
sports stores and online retailers to mass consumer
channels. Costco will begin rolling out Combat® in its
international locations in the later part of 2014 and early
2015.
- In October, the Company announced it received seven
Bodybuilding.com Supplement Awards. The Awards recognize
superior products and brands in the fitness and supplement
industry. Nominations are based on sales among the 9,900+
products carried by the site. In the past four years,
MusclePharm has won 14 Bodybuilding.com Awards, including 2012
Brand of the Year.
- In October, the Company named former GlaxoSmithKline® and
Campbell's® Soup executive, Sydney Rollock, as its Chief Marketing
Officer. Rollock has over 20 years of experience in marketing and
management within the Pharma, Pharma OTC, Health & Wellness and
Nutritional Supplements categories.
- In November, the Company announced an agreement with Walgreens
to distribute FitMiss™, the Company's innovative brand of
supplements formulated specifically for women. FitMiss
Delight™ will be available nationwide in all 7,000 Walgreens stores
beginning January 2014. FitMiss Burn™, FitMiss Tone™ and
Ready-to-Drink FitMiss Delight™ will be available at Walgreens
starting June 2014.
- In November, the Company announced it had signed a definitive
asset purchase agreement with BioZone Pharmaceuticals, Inc.
("BioZone") to acquire substantially all of the assets of BioZone
and its subsidiaries, including BioZone's QuSomes® technology as
well as its manufacturing facility in Richmond, California. The
closing of the transaction is subject to the satisfaction of
various conditions.
For Q3 2013, gross profit margin expanded to approximately 29%
of net sales as compared to a gross profit margin of 22% of net
sales in Q3 2012. The gross profit margin decreased
sequentially from approximately 31% in Q2 2013 primarily due to the
impact of an aggressive campaign to close-out inventory of the
Company's Assault™ pre-work product in advance of the launch of its
new Assault™ product formulation.
For Q3 2013, operating expenses increased to approximately $12.3
million, or 48% of net sales as compared to approximately $7.9
million, or 42% of net sales in Q3 2012. The increase in
operating expenses percentage of net sales was in part due to the
non-cash expenses related to the amortization of stock compensation
expense of approximately $2 million as well as an increase in
salary and wage expenses and advertising expenses.
For Q3 2013, the Company recorded other income of approximately
$927,000 as compared to other income of ($2.3 million) in Q3
2012. Q3 2013 other income included a positive change in the
fair value of derivatives liabilities associated with the Series D
Preferred Shares issued in February 2013 of $305,421 as well as a
gain in marketable securities of $444,059. Q3 2012 other income
included a positive change in fair value of derivative liabilities
of $4,403,875 as well as interest expense of $3,265,053 and a loss
on settlement of accounts payable and debt of $1,510,613.
Income available to common stockholders for Q3 2013 was
($3,946,000) or ($0.47) per diluted share as compared to income
available to common stockholders of ($6,074,000) or ($3.21) per
diluted share in Q3 2012. The weighted average number of fully
diluted shares outstanding for Q3 2013 was 8,475,084.
At the end of Q3 2013, the Company had approximately $5.7
million of cash and cash equivalents, approximately $9.6 million of
inventory, approximately $34.4 million in current assets, and no
long-term debt. Shareholders' equity at September 30, 2013
increased to $22.7 million as compared to ($9.8 million) at
December 31, 2012. As of November 14, 2013, there were
8,865,990 shares of common stock outstanding and 144,000 shares of
Series D Convertible Preferred stock outstanding which are
convertible into a total of 288,000 shares of common stock.
Management currently intends to release in January comprehensive
financial guidance for the full 2014 year.
MusclePharm management will discuss its Q3 2013 results during a
conference call to be broadcast live over the Internet Friday,
November 15th at 11:00 am EST.
Conference call particulars are as follows:
- Date - Friday, November 15, 2013
- Time - 11 am EST / 8:00 am PST
- Dial in number - (877) 407-9126 or (201) 493-6751 for
international callers
- Both the live Internet broadcast and replay can be
accessed at: http://musclepharm.equisolvewebcast.com/q3-2013
Management will take a limited number of questions from analysts
and institutional investors following the presentation.
ABOUT MUSCLEPHARM CORPORATION
MusclePharm® is a leading international, award-winning sports
nutrition company offering vitamins and nutritional supplements
which are available in more than 110 countries and available in
15,000+ U.S. retail outlets, including Costco, Dick's Sporting
Goods, 24 Hour Fitness, Bally's, GNC, Vitamin Shoppe and Vitamin
World. The company's brands are MusclePharm®, Arnold
Schwarzenegger Series™, and FitMiss™. The comprehensive lines of
clinically-proven, safe and effective nutritional supplements are
developed through a six-stage research process that utilizes the
expertise of leading nutritional scientists, doctors and
universities. For more information, visit www.musclepharmcorp.com.
Follow the company at http://www.facebook.com/MusclePharm and
www.Twitter.com/MusclePharm.
FORWARD-LOOKING STATEMENTS
This release contains forward-looking statements within the
meaning of Section 27A of the Securities Act of 1933, as amended,
and Section 21E of the Securities and Exchange Act of 1934, as
amended. Statements that are not a description of historical facts
constitute forward-looking statements and may often, but not
always, be identified by the use of such words as "expects",
"anticipates", "intends", "estimates", "plans", "potential",
"possible", "probable", "believes", "seeks", "may", "will",
"should", "could" or the negative of such terms or other similar
expressions. Actual results may differ materially from those set
forth in this release due to the risks and uncertainties inherent
in the Company's business. More detailed information about the
Company and the risk factors that may affect the realization of
forward-looking statements is set forth in the Company's Annual
Report on Form 10-K for the fiscal year ended December 31, 2012,
the Company's Quarter Reports on Form 10-Q and other filings
submitted by the Company to the SEC, copies of which may be
obtained from the SEC's website at www.sec.gov. Readers are
cautioned not to place undue reliance on these forward-looking
statements, which speak only as of the date hereof. All
forward-looking statements are qualified in their entirety by this
cautionary statement and the Company undertakes no obligation to
revise or update this release to reflect events or circumstances
after the date hereof.
|
|
MusclePharm Corporation |
|
Condensed Financial Statements |
|
|
|
|
|
For the Three Months Ended September 30, |
|
|
For the Nine Months Ended September 30, |
|
|
|
2013 |
|
|
2012 |
|
|
2013 |
|
|
2012 |
|
Sales
- gross |
|
$ |
31,080,225 |
|
|
$ |
20,627,691 |
|
|
$ |
84,519,744 |
|
|
$ |
58,799,563 |
|
Discounts and sales allowances |
|
|
(5,736,257 |
) |
|
|
(2,053,965 |
) |
|
|
(11,134,551 |
) |
|
|
(8,235,817 |
) |
Sales
- net |
|
|
25,343,968 |
|
|
|
18,573,726 |
|
|
|
73,385,193 |
|
|
|
50,563,746 |
|
Cost
of sales |
|
|
17,937,768 |
|
|
|
14,507,761 |
|
|
|
49,900,891 |
|
|
|
40,345,528 |
|
Gross
profit |
|
|
7,406,200 |
|
|
|
4,065,965 |
|
|
|
23,484,302 |
|
|
|
10,218,218 |
|
Operating expenses |
|
|
12,278,980 |
|
|
|
7,876,778 |
|
|
|
31,819,494 |
|
|
|
16,420,665 |
|
Loss
from operations |
|
|
(4,872,780 |
) |
|
|
(3,810,813 |
) |
|
|
(8,335,192 |
) |
|
|
(6,202,447 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
September 30, 2013 |
|
December 31, 2012 |
|
|
|
(unaudited) |
|
(audited) |
|
Assets |
|
|
|
|
|
|
|
Current Assets |
|
|
34,407,715 |
|
|
4,949,881 |
|
Property and equipment - net |
|
|
1,668,944 |
|
|
1,356,364 |
|
Other
assets |
|
|
5,470,804 |
|
|
460,482 |
|
Total
Assets |
|
$ |
41,547,463 |
|
$ |
6,766,727 |
|
Liabilities and Stockholders' Equity |
|
|
|
|
|
|
|
Current Liabilities |
|
|
18,865,271 |
|
|
16,520,456 |
|
Long
Term Liabilities |
|
|
7,554 |
|
|
4,523 |
|
Total
Liabilities |
|
|
18,872,825 |
|
|
16,524,979 |
|
Total
Stockholder's Equity |
|
|
22,674,638 |
|
|
(9,758,252 |
) |
Total
Liabilities and Stockholders' Equity |
|
$ |
41,547,463 |
|
$ |
6,766,727 |
|
|
|
|
|
|
|
|
|
MusclePharm Investor Contact: The Del Mar Consulting Group, Inc.
Robert B. Prag President Telephone: 858-794-9500 Email: Email
Contact Alex Partners, LLC Scott Wilfong President Telephone:
425-242-0891 Email: Email Contact
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