UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of report (Date of earliest event reported):
March 9, 2005
MANNATECH, INCORPORATED
(Exact Name of Registrant as Specified in its Charter)
| Texas | 000-24657 | 75-2508900 | ||
| (State or other Jurisdiction of Incorporation or Organization) |
(Commission File Number) | (I.R.S. Employer Identification No.) |
600 S. Royal Lane, Suite 200
Coppell, Texas 75019
(Address of Principal Executive Offices, including Zip Code)
Registrant’s Telephone Number, including Area Code: (972) 471-7400
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
| ¨ | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
| ¨ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
| ¨ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
| ¨ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
| Item 2.02. | Results of Operations and Financial Condition. |
On March 9, 2005, Mannatech, Incorporated issued a press release announcing its results of operations and financial condition for the year ended 2004. On March 10, 2005, Mannatech, Incorporated issued an updated press release related to the announcement of its year end 2004 earnings, which specifically identified the income tax receivable of $4.2 million. A copy of both of these press releases is attached as Exhibit 99.1 and Exhibit 99.2, respectively, to this Current Report on Form 8-K and is incorporated by reference in this report.
| Item 8.01. | Other Events. |
On March 10, 2005, Mannatech, Incorporated issued a press release announcing its declaration of a cash dividend payable on April 10, 2005 to shareholders of record at the close of business on April 1, 2005. A copy of the press release is attached as Exhibit 99.3 to this Current Report on Form 8-K and is incorporated by reference into this Item 8.01.
| Item 9.01 | Financial Statements and Exhibits. |
| (a) | Financial Statements or Business Acquired. |
| None. |
| (b) | Pro Forma Financial Information. |
| None. |
| (c) | Exhibits. |
Note: The information contained in this report (including all exhibits) is not to be deemed to be “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liabilities of that section.
| Exhibit Number |
Exhibit | |
| 99.1* | Press release dated March 9, 2005 entitled “Mannatech Inc. Announces Another Record-Breaking Year of Annual Sales & Profit”. | |
| 99.2* | Press release dated March 10, 2005 entitled “Mannatech, Inc. Announces Another Record-Breaking Year of Annual Sales & Profit”. | |
| 99.3* | Press release dated March 10, 2005 entitled “Mannatech, Inc. Declares Dividend”. |
*Filed herewith.
[SIGNATURE PAGE TO FOLLOW]
1
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, hereunto duly authorized.
| MANNATECH, INCORPORATED | ||||||||
| Dated: March 11, 2005 | By: | /s/ Stephen D. Fenstermacher | ||||||
| Name: | Stephen D. Fenstermacher | |||||||
| Title: | Senior Vice President and Chief Financial Officer | |||||||
2
EXHIBIT INDEX
| Exhibit Number |
Exhibit | |
| 99.1* | Press release dated March 9, 2005 entitled “Mannatech Inc. Announces Another Record-Breaking Year of Annual Sales & Profit”. | |
| 99.2* | Press release dated March 10, 2005 entitled “Mannatech, Inc. Announces Another Record-Breaking Year of Annual Sales & Profit”. | |
| 99.3* | Press release dated March 10, 2005 entitled “Mannatech, Inc. Declares Dividend”. |
*Filed herewith.
Exhibit 99.1
Mannatech Inc. Announces Another Record-Breaking Year of Annual Sales & Profit
Coppell, TX – March 9, 2005 – Mannatech, Incorporated (NASDAQ: MTEX) today announced the achievement of new annual sales and profit records for 2004. Consolidated net sales reached a new high of $294.5 million, an increase of $103.5 million, or 54.2%, as compared to 2003. Mannatech’s net income of $19.6 million more than doubled as compared to the prior year with an increase of $10.8 million, or 122.4%, and earnings per share of $0.71 (diluted) increased 108.8% as compared to 2003. Annual historical sales by market are shown in the table below.
| 2002 |
2003 |
2004 |
||||||||||||||||
| United States |
$ | 105.0 | 74.5 | % | $ | 127.8 | 67.0 | % | $ | 192.5 | 65.4 | % | ||||||
| Canada |
$ | 16.4 | 11.6 | % | $ | 16.7 | 8.7 | % | $ | 22.2 | 7.5 | % | ||||||
| Australia |
$ | 6.6 | 4.7 | % | $ | 15.6 | 8.2 | % | $ | 30.6 | 10.4 | % | ||||||
| United Kingdom |
$ | 1.6 | 1.1 | % | $ | 5.0 | 2.6 | % | $ | 10.5 | 3.6 | % | ||||||
| Japan |
$ | 9.0 | 6.4 | % | $ | 18.6 | 9.7 | % | $ | 24.5 | 8.3 | % | ||||||
| New Zealand |
$ | 2.3 | 1.7 | % | $ | 7.3 | 3.8 | % | $ | 12.9 | 4.4 | % | ||||||
| South Korea |
$ | — | — | % | $ | — | — | % | $ | 1.3 | 0.4 | % | ||||||
| Total |
$ | 140.9 | 100.0 | % | $ | 191.0 | 100.0 | % | $ | 294.5 | 100.0 | % | ||||||
Fourth quarter results also included a new consolidated net sales record of $84.2 million for Mannatech, which was an increase of $29.9 million, or 55.1%, as compared to the same period in 2003. Fourth quarter net income was $4.0 million, or $0.15 earnings per share (diluted), which was an increase of 21.9 % over the fourth quarter of 2003. Net income for the fourth quarter included one-time non-cash charge, totaling $3.0 million, or $0.07 per diluted share, net of tax, related to Mr. Caster’s sale of 180,000 shares of his common stock to a former employee, Dr. H. Reginald McDaniel. The sale was for a price that was below the fair market value of Mannatech’s stock on the date of the sale. Quarterly sales volumes by market are shown in the table below.
| First Quarter |
Second Quarter |
Third Quarter |
Fourth Quarter |
|||||||||||||||||||||
| United States |
$ | 36.8 | 63.0 | % | $ | 49.5 | 66.6 | % | $ | 51.3 | 66.1 | % | $ | 54.8 | 65.2 | % | ||||||||
| Canada |
$ | 4.7 | 8.0 | % | $ | 5.8 | 7.8 | % | $ | 5.6 | 7.2 | % | $ | 6.1 | 7.2 | % | ||||||||
| Australia |
$ | 6.5 | 11.1 | % | $ | 7.4 | 10.0 | % | $ | 8.0 | 10.3 | % | $ | 8.8 | 10.4 | % | ||||||||
| United Kingdom |
$ | 2.8 | 4.8 | % | $ | 2.6 | 3.5 | % | $ | 2.6 | 3.3 | % | $ | 2.5 | 3.0 | % | ||||||||
| Japan |
$ | 5.0 | 8.6 | % | $ | 5.9 | 7.9 | % | $ | 6.5 | 8.4 | % | $ | 7.1 | 8.4 | % | ||||||||
| New Zealand |
$ | 2.6 | 4.5 | % | $ | 3.1 | 4.2 | % | $ | 3.4 | 4.4 | % | $ | 3.8 | 4.5 | % | ||||||||
| South Korea |
$ | — | — | % | $ | — | — | % | $ | 0.2 | 0.3 | % | $ | 1.1 | 1.3 | % | ||||||||
| Total |
$ | 58.4 | 100.0 | % | $ | 74.3 | 100.0 | % | $ | 77.6 | 100.0 | % | $ | 84.2 | 100.0 | % | ||||||||
Mr. Caster commented on the new all time high record sales volumes for the periods, stating “We are extremely pleased with the financial gains and continued strength shown throughout 2004, and also are delighted with the impressive sales momentum generated by our 369,000 current independent Associates and members around the world. Our groundbreaking glyconutritional technology continues to bring hope, health, and opportunity to people in record numbers and we believe that we are just scratching the surface of the potential of Mannatech.”
The number of current Mannatech independent Associates and members is as follows:
| For the year ended December 31, |
|||||||||||||||
| 2002 |
2003 |
2004 |
|||||||||||||
| New |
91,000 | 45.6 | % | 134,000 | 50.8 | % | 178,000 | 48.2 | % | ||||||
| Continuing |
109,000 | 54.4 | % | 130,000 | 49.2 | % | 191,000 | 51.8 | % | ||||||
| Total |
200,000 | 100.0 | % | 264,000 | 100.0 | % | 369,000 | 100.0 | % | ||||||
1
About Mannatech, Incorporated
Mannatech, based in Coppell, Texas, is a wellness solution provider that sells its products through a global network-marketing system throughout the United States and the international markets of Canada, Australia, the United Kingdom, Japan, New Zealand, and South Korea. For additional information about Mannatech, please visit its corporate website: www.mannatech.com.
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 “may,” “believes,” and “plans” or other similar words or the negative of such terminology. Similarly, descriptions of Mannatech’s objectives, strategies, plans, goals or targets contained herein are also considered forward-looking statements. Mannatech believes this release should be read in conjunction with all of its filings with the SEC 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, Mannatech’s inability to attract and retain associates and members, increases in competition, litigation, regulatory changes, and its planned growth into new international markets. Although Mannatech believes that its expectations, statements, and assumptions reflected in these forward-looking statements are reasonable, it cautions its 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 other filings filed with the SEC, 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.
Contact:
Stephen Fenstermacher
972-471-6512
IR@mannatech.com
2
MANNATECH, INCORPORATED
CONSOLIDATED BALANCE SHEETS
(unaudited, in thousands, except share and per share information)
| December 31, |
||||||||
| 2003 |
2004 |
|||||||
| ASSETS | ||||||||
| Cash and cash equivalents |
$ | 28,291 | $ | 44,198 | ||||
| Restricted cash |
2,140 | 393 | ||||||
| Income tax receivable |
— | 4,161 | ||||||
| Accounts receivable |
134 | 392 | ||||||
| Current portion of notes receivable from affiliates |
55 | 144 | ||||||
| Inventories |
7,861 | 13,157 | ||||||
| Prepaid expenses and other current assets |
2,084 | 3,188 | ||||||
| Deferred tax assets |
2,363 | 1,850 | ||||||
| Total current assets |
42,928 | 67,483 | ||||||
| Property and equipment, net |
5,514 | 10,013 | ||||||
| Long-term investments |
9,994 | 17,073 | ||||||
| Notes receivable from affiliates, excluding current portion |
150 | — | ||||||
| Deferred tax assets |
631 | 1,003 | ||||||
| Other assets |
806 | 2,774 | ||||||
| Total assets |
$ | 60,023 | $ | 98,346 | ||||
| LIABILITIES AND SHAREHOLDERS’ EQUITY | ||||||||
| Current portion of capital leases |
$ | 16 | $ | 8 | ||||
| Accounts payable |
2,687 | 2,227 | ||||||
| Accrued expenses |
19,940 | 35,037 | ||||||
| Deferred revenue |
3,142 | 2,256 | ||||||
| Current portion of accrued severance related to former executives |
953 | 375 | ||||||
| Total current liabilities |
26,738 | 39,903 | ||||||
| Capital leases, excluding current portion |
32 | 26 | ||||||
| Accrued severance related to former executives, excluding current portion |
359 | — | ||||||
| Long-term liabilities |
— | 530 | ||||||
| Long-term royalties due to an affiliate |
106 | 1,658 | ||||||
| Deferred tax liabilities |
— | 4 | ||||||
| Total liabilities |
27,235 | 42,121 | ||||||
| Commitments and contingencies |
— | — | ||||||
| Shareholders’ equity: |
||||||||
| Preferred stock, $0.01 par value, 1,000,000 shares authorized, no shares issued and outstanding |
— | — | ||||||
| Common stock, $0.0001 par value, 99,000,000 shares authorized, 26,227,171 shares issued and 26,183,422 outstanding in 2003 and 27,115,440 shares issued and 27,041,125 outstanding in 2004 |
3 | 3 | ||||||
| Additional paid-in capital |
24,175 | 34,917 | ||||||
| Retained earnings |
9,271 | 21,672 | ||||||
| Accumulated other comprehensive loss |
(422 | ) | 195 | |||||
| 33,027 | 56,787 | |||||||
| Less treasury stock, at cost, 43,749 shares in 2003 and 74,315 shares in 2004 |
(239 | ) | (562 | ) | ||||
| Total shareholders’ equity |
32,788 | 56,225 | ||||||
| Total liabilities and shareholders’ equity |
$ | 60,023 | $ | 98,346 | ||||
3
MANNATECH, INCORPORATED
CONSOLIDATED STATEMENTS OF OPERATIONS
(unaudited, in thousands, except per share information)
| Three months ended December 31, |
Twelve months ended December 31, |
|||||||||||||||
| 2003 |
2004 |
2003 |
2004 |
|||||||||||||
| Net sales |
$ | 54,292 | $ | 84,226 | $ | 191,019 | $ | 294,508 | ||||||||
| Cost of sales |
8,602 | 12,976 | 30,884 | 44,847 | ||||||||||||
| Commissions and incentives |
22,665 | 37,524 | 79,577 | 132,231 | ||||||||||||
| 31,267 | 50,500 | 110,461 | 177,078 | |||||||||||||
| Gross profit |
23,025 | 33,726 | 80,558 | 117,430 | ||||||||||||
| Operating expenses: |
||||||||||||||||
| Selling and administrative expenses |
10,765 | 13,896 | 39,993 | 50,006 | ||||||||||||
| Other operating costs |
7,973 | 12,925 | 26,956 | 37,840 | ||||||||||||
| Severance expense |
176 | — | 2,017 | — | ||||||||||||
| Non-cash charge related to affiliate stock sale |
— | 3,047 | — | 3,047 | ||||||||||||
| Total operating expenses |
18,914 | 29,868 | 68,966 | 90,893 | ||||||||||||
| Income from operations |
4,111 | 3,858 | 11,592 | 26,537 | ||||||||||||
| Interest income |
134 | 306 | 348 | 735 | ||||||||||||
| Interest expense |
(23 | ) | (1 | ) | (44 | ) | (17 | ) | ||||||||
| Other income (expense), net |
610 | 781 | 842 | (257 | ) | |||||||||||
| Income before income taxes |
4,832 | 4,944 | 12,738 | 26,998 | ||||||||||||
| Income taxes |
(1,513 | ) | (899 | ) | (3,948 | ) | (7,446 | ) | ||||||||
| Net income |
$ | 3,319 | $ | 4,045 | $ | 8,790 | $ | 19,552 | ||||||||
| Earnings per common share: |
||||||||||||||||
| Basic |
$ | 0.13 | $ | 0.15 | $ | 0.34 | $ | 0.74 | ||||||||
| Diluted |
$ | 0.12 | $ | 0.15 | $ | 0.34 | $ | 0.71 | ||||||||
| Weighted-average common shares outstanding: |
||||||||||||||||
| Basic |
25,996 | 26,768 | 25,494 | 26,436 | ||||||||||||
| Diluted |
26,695 | 27,741 | 26,175 | 27,491 | ||||||||||||
4
EXHIBIT 99.2
Mannatech Inc. Announces Another Record-Breaking Year of Annual Sales & Profit
Coppell, TX—March 10, 2005-Updated– Mannatech, Incorporated (NASDAQ: MTEX) today announced the achievement of new annual sales and profit records for 2004. Consolidated net sales reached a new high of $294.5 million, an increase of $103.5 million, or 54.2%, as compared to 2003. Mannatech’s net income of $19.6 million more than doubled as compared to the prior year with an increase of $10.8 million, or 122.4%, and earnings per share of $0.71 (diluted) increased 108.8% as compared to 2003. Annual historical sales by market are shown in the table below.
| 2002 |
2003 |
2004 |
||||||||||||||||
| United States |
$ | 105.0 | 74.5 | % | $ | 127.8 | 67.0 | % | $ | 192.5 | 65.4 | % | ||||||
| Canada |
$ | 16.4 | 11.6 | % | $ | 16.7 | 8.7 | % | $ | 22.2 | 7.5 | % | ||||||
| Australia |
$ | 6.6 | 4.7 | % | $ | 15.6 | 8.2 | % | $ | 30.6 | 10.4 | % | ||||||
| United Kingdom |
$ | 1.6 | 1.1 | % | $ | 5.0 | 2.6 | % | $ | 10.5 | 3.6 | % | ||||||
| Japan |
$ | 9.0 | 6.4 | % | $ | 18.6 | 9.7 | % | $ | 24.5 | 8.3 | % | ||||||
| New Zealand |
$ | 2.3 | 1.7 | % | $ | 7.3 | 3.8 | % | $ | 12.9 | 4.4 | % | ||||||
| South Korea |
$ | — | — | % | $ | — | — | % | $ | 1.3 | 0.4 | % | ||||||
| Total |
$ | 140.9 | 100.0 | % | $ | 191.0 | 100.0 | % | $ | 294.5 | 100.0 | % | ||||||
Fourth quarter results also included a new consolidated net sales record of $84.2 million for Mannatech, which was an increase of $29.9 million, or 55.1%, as compared to the same period in 2003. Fourth quarter net income was $4.0 million, or $0.15 earnings per share (diluted), which was an increase of 21.9 % over the fourth quarter of 2003. Net income for the fourth quarter included one-time non-cash charge, totaling $3.0 million, or $0.07 per diluted share, net of tax, related to Mr. Caster’s sale of 180,000 shares of his common stock to a former employee, Dr. H. Reginald McDaniel. The sale was for a price that was below the fair market value of Mannatech’s stock on the date of the sale. Quarterly sales volumes by market are shown in the table below.
| First Quarter |
Second Quarter |
Third Quarter |
Fourth Quarter |
|||||||||||||||||||||
| United States |
$ | 36.8 | 63.0 | % | $ | 49.5 | 66.6 | % | $ | 51.3 | 66.1 | % | $ | 54.8 | 65.2 | % | ||||||||
| Canada |
$ | 4.7 | 8.0 | % | $ | 5.8 | 7.8 | % | $ | 5.6 | 7.2 | % | $ | 6.1 | 7.2 | % | ||||||||
| Australia |
$ | 6.5 | 11.1 | % | $ | 7.4 | 10.0 | % | $ | 8.0 | 10.3 | % | $ | 8.8 | 10.4 | % | ||||||||
| United Kingdom |
$ | 2.8 | 4.8 | % | $ | 2.6 | 3.5 | % | $ | 2.6 | 3.3 | % | $ | 2.5 | 3.0 | % | ||||||||
| Japan |
$ | 5.0 | 8.6 | % | $ | 5.9 | 7.9 | % | $ | 6.5 | 8.4 | % | $ | 7.1 | 8.4 | % | ||||||||
| New Zealand |
$ | 2.6 | 4.5 | % | $ | 3.1 | 4.2 | % | $ | 3.4 | 4.4 | % | $ | 3.8 | 4.5 | % | ||||||||
| South Korea |
$ | — | — | % | $ | — | — | % | $ | 0.2 | 0.3 | % | $ | 1.1 | 1.3 | % | ||||||||
| Total |
$ | 58.4 | 100.0 | % | $ | 74.3 | 100.0 | % | $ | 77.6 | 100.0 | % | $ | 84.2 | 100.0 | % | ||||||||
Mr. Caster commented on the new all time high record sales volumes for the periods, stating “We are extremely pleased with the financial gains and continued strength shown throughout 2004, and also are delighted with the impressive sales momentum generated by our 369,000 current independent Associates and members around the world. Our groundbreaking glyconutritional technology continues to bring hope, health, and opportunity to people in record numbers and we believe that we are just scratching the surface of the potential of Mannatech.”
The number of current Mannatech independent Associates and members is as follows:
| For the year ended December 31, |
|||||||||||||||
| 2002 |
2003 |
2004 |
|||||||||||||
| New |
91,000 | 45.6 | % | 134,000 | 50.8 | % | 178,000 | 48.2 | % | ||||||
| Continuing |
109,000 | 54.4 | % | 130,000 | 49.2 | % | 191,000 | 51.8 | % | ||||||
| Total |
200,000 | 100.0 | % | 264,000 | 100.0 | % | 369,000 | 100.0 | % | ||||||
1
About Mannatech, Incorporated
Mannatech, based in Coppell, Texas, is a wellness solution provider that sells its products through a global network-marketing system throughout the United States and the international markets of Canada, Australia, the United Kingdom, Japan, New Zealand, and South Korea. For additional information about Mannatech, please visit its corporate website: www.mannatech.com.
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 “may,” “believes,” and “plans” or other similar words or the negative of such terminology. Similarly, descriptions of Mannatech’s objectives, strategies, plans, goals or targets contained herein are also considered forward-looking statements. Mannatech believes this release should be read in conjunction with all of its filings with the SEC 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, Mannatech’s inability to attract and retain associates and members, increases in competition, litigation, regulatory changes, and its planned growth into new international markets. Although Mannatech believes that its expectations, statements, and assumptions reflected in these forward-looking statements are reasonable, it cautions its 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 other filings filed with the SEC, 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.
Contact:
Stephen Fenstermacher
972-471-6512
IR@mannatech.com
2
MANNATECH, INCORPORATED
CONSOLIDATED BALANCE SHEETS
(unaudited, in thousands, except share and per share information)
| December 31, |
||||||||
| 2003 |
2004 |
|||||||
| ASSETS | ||||||||
| Cash and cash equivalents |
$ | 28,291 | $ | 44,198 | ||||
| Restricted cash |
2,140 | 393 | ||||||
| Income tax receivable |
— | 4,161 | ||||||
| Accounts receivable |
134 | 392 | ||||||
| Current portion of notes receivable from affiliates |
55 | 144 | ||||||
| Inventories |
7,861 | 13,157 | ||||||
| Prepaid expenses and other current assets |
2,084 | 3,188 | ||||||
| Deferred tax assets |
2,363 | 1,850 | ||||||
| Total current assets |
42,928 | 67,483 | ||||||
| Property and equipment, net |
5,514 | 10,013 | ||||||
| Long-term investments |
9,994 | 17,073 | ||||||
| Notes receivable from affiliates, excluding current portion |
150 | — | ||||||
| Deferred tax assets |
631 | 1,003 | ||||||
| Other assets |
806 | 2,774 | ||||||
| Total assets |
$ | 60,023 | $ | 98,346 | ||||
| LIABILITIES AND SHAREHOLDERS’ EQUITY | ||||||||
| Current portion of capital leases |
$ | 16 | $ | 8 | ||||
| Accounts payable |
2,687 | 2,227 | ||||||
| Accrued expenses |
19,940 | 35,037 | ||||||
| Deferred revenue |
3,142 | 2,256 | ||||||
| Current portion of accrued severance related to former executives |
953 | 375 | ||||||
| Total current liabilities |
26,738 | 39,903 | ||||||
| Capital leases, excluding current portion |
32 | 26 | ||||||
| Accrued severance related to former executives, excluding current portion |
359 | — | ||||||
| Long-term liabilities |
— | 530 | ||||||
| Long-term royalties due to an affiliate |
106 | 1,658 | ||||||
| Deferred tax liabilities |
— | 4 | ||||||
| Total liabilities |
27,235 | 42,121 | ||||||
| Commitments and contingencies |
— | — | ||||||
| Shareholders’ equity: |
||||||||
| Preferred stock, $0.01 par value, 1,000,000 shares authorized, no shares issued and outstanding |
— | — | ||||||
| Common stock, $0.0001 par value, 99,000,000 shares authorized, 26,227,171 shares issued and 26,183,422 outstanding in 2003 and 27,115,440 shares issued and 27,041,125 outstanding in 2004 |
3 | 3 | ||||||
| Additional paid-in capital |
24,175 | 34,917 | ||||||
| Retained earnings |
9,271 | 21,672 | ||||||
| Accumulated other comprehensive loss |
(422 | ) | 195 | |||||
| 33,027 | 56,787 | |||||||
| Less treasury stock, at cost, 43,749 shares in 2003 and 74,315 shares in 2004 |
(239 | ) | (562 | ) | ||||
| Total shareholders’ equity |
32,788 | 56,225 | ||||||
| Total liabilities and shareholders’ equity |
$ | 60,023 | $ | 98,346 | ||||
3
MANNATECH, INCORPORATED
CONSOLIDATED STATEMENTS OF OPERATIONS
(unaudited, in thousands, except per share information)
| Three months ended December 31, |
Twelve months ended December 31, |
|||||||||||||||
| 2003 |
2004 |
2003 |
2004 |
|||||||||||||
| Net sales |
$ | 54,292 | $ | 84,226 | $ | 191,019 | $ | 294,508 | ||||||||
| Cost of sales |
8,602 | 12,976 | 30,884 | 44,847 | ||||||||||||
| Commissions and incentives |
22,665 | 37,524 | 79,577 | 132,231 | ||||||||||||
| 31,267 | 50,500 | 110,461 | 177,078 | |||||||||||||
| Gross profit |
23,025 | 33,726 | 80,558 | 117,430 | ||||||||||||
| Operating expenses: |
||||||||||||||||
| Selling and administrative expenses |
10,765 | 13,896 | 39,993 | 50,006 | ||||||||||||
| Other operating costs |
7,973 | 12,925 | 26,956 | 37,840 | ||||||||||||
| Severance expense |
176 | — | 2,017 | — | ||||||||||||
| Non-cash charge related to affiliate stock sale |
— | 3,047 | — | 3,047 | ||||||||||||
| Total operating expenses |
18,914 | 29,868 | 68,966 | 90,893 | ||||||||||||
| Income from operations |
4,111 | 3,858 | 11,592 | 26,537 | ||||||||||||
| Interest income |
134 | 306 | 348 | 735 | ||||||||||||
| Interest expense |
(23 | ) | (1 | ) | (44 | ) | (17 | ) | ||||||||
| Other income (expense), net |
610 | 781 | 842 | (257 | ) | |||||||||||
| Income before income taxes |
4,832 | 4,944 | 12,738 | 26,998 | ||||||||||||
| Income taxes |
(1,513 | ) | (899 | ) | (3,948 | ) | (7,446 | ) | ||||||||
| Net income |
$ | 3,319 | $ | 4,045 | $ | 8,790 | $ | 19,552 | ||||||||
| Earnings per common share: |
||||||||||||||||
| Basic |
$ | 0.13 | $ | 0.15 | $ | 0.34 | $ | 0.74 | ||||||||
| Diluted |
$ | 0.12 | $ | 0.15 | $ | 0.34 | $ | 0.71 | ||||||||
| Weighted-average common shares outstanding: |
||||||||||||||||
| Basic |
25,996 | 26,768 | 25,494 | 26,436 | ||||||||||||
| Diluted |
26,695 | 27,741 | 26,175 | 27,491 | ||||||||||||
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EXHIBIT 99.3
Mannatech, Incorporated Declares Dividend
Coppell, TX – March 9, 2005 – Mannatech, Incorporated (NASDAQ – MTEX) today announced that its Board of Directors declared a quarterly cash dividend of $0.07 per common share payable on Friday, April 15, 2005, to all shareholders of record at the close of business on Friday, April 1, 2005. This will be the second dividend paid by the Company this year. The declaration follows this week’s record sales and earnings announcement of $0.71 earnings per share fully-diluted for the year ended 2004. The dividend reflects Mannatech’s continued growth in earnings, as well as its on-going commitment to encourage long-term investment in its common stock.
About Mannatech, Incorporated
Mannatech, based in Coppell, Texas, is a wellness solution provider that sells its products through a global network-marketing system throughout the United States and the international markets of Canada, Australia, the United Kingdom, Japan, New Zealand, and South Korea. For additional information about Mannatech, please visit its corporate website: www.mannatech.com.
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 “may,” “believes,” and “plans” or other similar words or the negative of such terminology. Similarly, descriptions of Mannatech’s objectives, strategies, plans, goals or targets contained herein are also considered forward-looking statements. Mannatech believes this release should be read in conjunction with all of its filings with the SEC 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, Mannatech’s inability to attract and retain associates and members, increases in competition, litigation, regulatory changes, and its planned growth into new international markets. Although Mannatech believes that its expectations, statements, and assumptions reflected in these forward-looking statements are reasonable, it cautions its 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 other filings filed with the SEC, 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.
Contact:
Mannatech, Incorporated
Stephen Fenstermacher
972-471-6512
IR@mannatech.com
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