Vitacost.com, Inc. (NASDAQ: VITC), a leading online retailer and direct
marketer of health and wellness products, today reported preliminary
financial results for the second quarter ended June 30, 2010.
For the second quarter of 2010, the Company estimates net sales to be
approximately $54.0 million, a 14% increase compared to the $47.3
million of net sales reported in the second quarter of 2009 and a 6%
sequential decline from the $57.2 million of net sales reported in the
first quarter of 2010. Revenue is expected to fall below the Company’s
prior revenue guidance of $57.2 to $58.2 million. Revenue was impacted
by weaker than expected demand, as well as the continuation of
manufacturing logistics issues previously disclosed by the Company in
the first quarter of 2010.
For the second quarter of 2010, the Company expects to realize a loss
per share in the range of $0.04 to $0.06, compared to earnings per share
of $0.15 for the second quarter of 2009 and compared to earnings per
share of $0.09 in the first quarter of 2010. Second quarter results
include estimated transaction expenses associated with the Company’s
contested proxy solicitation and other non-recurring items. The
Company’s previously announced guidance for the second quarter was for
earnings per share in the range of $0.09 to $0.10. The earnings
shortfall was primarily attributable to lower gross margins due to a
higher than expected percentage of sales derived from lower margin third
party products and higher than expected shipping costs; and negative
leverage with higher than expected operating costs off of a lower sales
base.
All figures in this release remain subject to the completion of normal
quarter-end accounting procedures and adjustments, which could result in
changes to these preliminary results.
The new Board of Directors, formed on July 21, 2010, is conducting a
review of operations to identify and introduce changes to the Company’s
business plan and operating strategy as are necessary to improve the
Company’s financial performance.
Second Quarter 2010 Earnings Reporting Date and Conference Call
The Company will announce second quarter 2010 earnings results on
Monday, August 16, 2010. The Company will also host a conference call to
discuss these results and will provide additional comments and details
at that time.
The conference call is scheduled to begin at 5:00 p.m. EDT on Monday,
August 16, 2010. The call will be broadcast live over the Internet
hosted on the Investor Relations section of Vitacost.com's website at www.vitacost.com,
and will be archived online through August 30, 2010. In addition, you
may dial (877) 407-0789 to listen to the live broadcast.
A telephonic playback will be available from 8:00 p.m. EDT, August 16,
2010, through August 30, 2010. Participants can dial (877) 660-6853 to
hear the playback. The account number is 3055 and the pass code is
354683.
About Vitacost.com, Inc.
Vitacost.com, Inc. (NASDAQ: VITC) is a leading online retailer and
direct marketer of health and wellness products, including dietary
supplements such as vitamins, minerals, herbs or other botanicals, amino
acids and metabolites, as well as cosmetics, organic body and personal
care products, sports nutrition and health foods. Vitacost.com, Inc.
sells these products directly to consumers through its website, www.vitacost.com,
as well as through its catalogs. Vitacost.com, Inc. strives to offer its
customers the broadest product selection of healthy living products,
while providing superior customer service and timely and accurate
delivery.
Forward-Looking Statements
Except for historical information contained herein, the statements in
this release are forward-looking and made pursuant to the safe harbor
provisions of the Private Securities Litigation Reform Act of 1995.
Forward-looking statements made herein, which include management's
expected results of operations for the second quarter of 2010, and the
full year of 2010, involve known and unknown risks and uncertainties,
which may cause Vitacost's actual results in current or future periods
to differ materially from forecasted results. Those risks and
uncertainties include, among other things, the current global economic
downturn or recession; difficulty expanding its manufacturing and
distribution facilities; significant competition in its industry;
unfavorable publicity or consumer perception of its products on the
Internet; the incurrence of material product liability and product
recall costs; Inability to defend intellectual property claims; costs of
compliance and its failure to comply with government regulations; its
failure to keep pace with the demands of our customers for new products;
disruptions in its manufacturing system, including information
technology systems, or losses of manufacturing certifications; and the
lack of long-term experience with human consumption of some of its
products with innovative ingredients. Those and other risks are more
fully described in Vitacost's filings with the Securities and Exchange
Commission, including the Registration Statement on Form S-1, as
amended, filed in connection with the Company's initial public offering
as well as the Company's form 10-K filed for the fiscal year ended
December 31, 2009.
Investor Contact:
Vitacost.com
Kathleen Reed
Director of
Investor Relations
561-982-4180
or
ICR, Inc
John
Mills
Senior Managing Director
310-954-1105