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| 8-K - FITLIFE BRANDS, INC. | form8k-04032020_060402.htm |
FitLife Brands Provides Preliminary First Quarter Results and
Operational Update
OMAHA,
NE – April 3, 2020 -- FitLife Brands, Inc.
(“FitLife” or the “Company”) (OTC Pink:
FTLF), an international provider of innovative and proprietary
nutritional supplements for health-conscious consumers marketed
under the brand names NDS Nutrition™, PMD®,
SirenLabs®, CoreActive®, Metis Nutrition™,
iSatori™, Energize, and BioGenetic Laboratories, is providing
some preliminary performance indicators for the first quarter of
2020, along with a general operational update. The intent of this
communication is to provide transparency to the shareholders of the
Company given the challenges and uncertainty resulting from the
COVID-19 outbreak.
Preliminary results for the quarter ended March 31,
2020:
●
Total revenue is
anticipated to be in the range of $5.9-6.1 million, compared to
$5.9 million during the first quarter of 2019.
●
Direct-to-consumer
online sales are estimated to be 14-15% of total revenue, compared
to 10% in the same quarter last year.
●
Net income is
expected to exceed the $1.2 million reported for the first quarter
of last year.
General operational update related to current economic
environment:
●
As of April 2,
2020, the Company had $3.5 million of cash on hand. Of this amount,
$2.5 million represents amounts advanced to the Company in March
under its line of credit, as previously announced.
●
The Company has no
debt outstanding other than the amounts drawn on the line of
credit.
●
The Company remains
in compliance with all covenants associated with its line of
credit.
●
As of April 2,
2020, the Company had accounts receivable totaling $3.6 million, of
which approximately 34% is due within the next two
weeks.
●
At this point, all
of the Company’s customers continue to pay in the ordinary
course of business.
●
Management believes
that its brick and mortar customers are experiencing significant
declines in foot traffic, which will result in reduced orders
during the second quarter of 2020; however, management cannot
currently predict the duration of the downturn associated with
COVID-19 or the magnitude of the declines the Company’s brick
and mortar customers will experience.
●
While GNC has
reported significant store closures due to COVID-19, management
believes that most of the closures relate to corporate stores. The
Company’s primary exposure is to GNC franchise locations, and
all of the Company’s largest franchisee customers remain open
for business.
●
The Company’s
products continue to be available for sale on Amazon, eBay, and the
Company’s own websites.
●
The Company
continues to experience growth in direct-to-consumer sales, and the
growth rate has accelerated as traffic to physical store locations
has declined due to COVID-19. However, management believes that the
expected increase in online revenue will only partially offset the
anticipated decline in wholesale revenue for the
Company.
●
The Company is
taking additional steps to further reduce operating expenses and to
postpone planned production runs in order to preserve cash and
better align supply with anticipated demand.
●
The Company has
submitted an application for a loan under the Paycheck Protection
Program of the US Department of the Treasury. If the Company is
successful in receiving the loan, a substantial portion of the
proceeds of the loan will be forgiven as long as the Company
maintains its current employee headcount.
About FitLife Brands
FitLife
Brands is a developer and marketer of innovative and proprietary
nutritional supplements for health-conscious consumers. FitLife
markets over 80 different dietary supplements to promote sports
nutrition, improved performance, weight loss and general health
primarily through domestic and international GNC® franchise
locations as well as through more than 25,000 additional domestic
retail locations and, increasingly, online. FitLife is
headquartered in Omaha, Nebraska. For more information please visit
our new website at www.fitlifebrands.com.
Forward-Looking Statements
Statements
in this release that are forward looking involve known and unknown
risks and uncertainties, which may cause the Company's actual
results in future periods to be materially different from any
future performance that may be suggested in this news release. Such
factors may include, but are not limited to, the ability to of the
Company to continue to grow revenue, and the Company's ability to
continue to achieve positive cash flow given the Company's existing
and anticipated operating and other costs. Many of these risks and
uncertainties are beyond the Company's control. Reference is made
to the discussion of risk factors detailed in the Company's filings
with the Securities and Exchange Commission including its reports
on Form 10-K and 10-Q. Readers are cautioned not to place undue
reliance on these forward-looking statements, which speak only as
of the dates on which they are made.