SAN DIEGO--(BUSINESS WIRE)--Youngevity International, Inc. (OTCQX: YGYI) (www.YGYI.com), a global direct marketer of nutritional and lifestyle products and also a vertically-integrated producer of fine coffees for the commercial, retail and direct sales channels, reported today its financial results for the second quarter of 2013.
Fiscal 2013 Second Quarter Results
For the second fiscal quarter ended June 30, 2013, Youngevity International’s revenue increased 8.9% to $20.9 million compared to $19.2 million for the same period in fiscal 2012. The increase in revenue is attributed primarily to the increase in our product offerings and the number of distributors resulting from our acquisitions during 2012, the effect of the annual convention which was held during the quarter ended June 30, 2013, while last year’s convention was held during the first quarter and the organic growth of the CLR Roasters private label business.
Youngevity International’s gross profit for the second fiscal quarter ended June 30, 2013 increased approximately 15.5% to $12.7 million compared to $11.0 million recorded in the same period last year. The increase in gross profit as a percentage of revenues came primarily from the direct selling segment where we improved efficiencies in fulfillment costs and gained economies of scale as a result of an increase in revenues.
The Company reported second fiscal quarter 2013 net income of $662,000, compared to a net loss of ($36,000) for the quarter ended June 30, 2012. The increase of $698,000 was attributable to the increase in income before income taxes of $809,000, offset by an increase in income tax provision of $111,000.
As of June 30, 2013, the Company’s cash and cash equivalents were $3.6 million and working capital of $2.5 million as compared to cash and cash equivalents of $3.0 million and a working capital of $1.4 million as of December 31, 2012. The increase in cash and improvement in net working capital was primarily due to increased revenues and earnings.
Fiscal 2013 First Six Months Results
For the six months ended June 30, 2013, the Company reported net revenue of $41.7 million, compared to $35.2 million for the same period in fiscal 2012, an 18.5% increase. Gross profit for the second quarter of fiscal year 2013 increased 25.5% to $25.1 million as compared to $20.0 million in the prior year period.
Net income for the second quarter of fiscal year 2013 was $1.7 million as compared to a net loss of $887,000 reported in the same period in fiscal 2012. The increase of $2.5 million was attributable to the increase in income before income taxes of $2.8 million offset by an increase in income tax provision of $301,000.
EBITDA (earnings before interest, taxes, depreciation and amortization) as adjusted to remove the effect of stock based compensation expense, or “Adjusted EBITDA”, was $3.9 million for the six months ended June 30, 2013 compared to $732,000 in the same period for the prior year.
Dave Briskie, Chief Financial Officer of Youngevity International, Inc. said, “Our second quarter results reflect strong year-over-year improvements in revenue and cash flow and we are encouraged with our continued improvement in net income and the strengthening of our balance sheet. Our profitability improvement strategy that we announced in Q3 2012 has delivered as anticipated and has helped better position the Company to execute its acquisition and international expansion strategy. ”
“Obviously with over a $3 million dollar improvement in adjusted EBITDA for the six months ended June 30, 2013 we are pleased with our progress through the second quarter,” said Steve Wallach, Chief Executive Officer of Youngevity International. He continued, “Our goals are to deliver fundamental shareholder value and to become industry leaders in both the direct selling and commercial coffee segments. We will work tirelessly until these objectives are met.”
Conference Call Information
Youngevity International will host a conference call today at 4:15 p.m. Eastern Time to discuss its financial results, quarterly highlights and business outlook. Investors can access the conference call by dialing Toll: +1 (609) 318-0024 and entering the access code: 307-730-091. It is advised that you dial-in at least five minutes prior to the call.
The conference call will be recorded and available for replay shortly after the conclusion of the call. Recorded calls are available in the Investor Relations section of Youngevity International’s website: http://ygyi.com/calls.php
Non-GAAP Financial Measure – Adjusted EBITDA
This news release includes information on Adjusted EBITDA, which is a non-GAAP financial measure as defined by SEC Regulation G. Management believes that Adjusted EBITDA, when viewed with our results under GAAP and the accompanying reconciliations, provides useful information about our period-over-period growth. Adjusted EBITDA is presented because management believes it provides additional information with respect to the performance of our fundamental business activities and is also frequently used by securities analysts, investors and other interested parties in the evaluation of comparable companies. We also rely on Adjusted EBITDA as a primary measure to review and assess the operating performance of our company and our management team. Adjusted EBITDA should not be construed as a substitute for net income (loss) (as determined in accordance with GAAP) for the purpose of analyzing the Company’s operating performance or financial position, as Adjusted EBITDA is not defined by GAAP.
The Company defines Adjusted EBITDA as earnings (net income or loss) before interest, taxes, depreciation and amortization, as adjusted to eliminate the effects of stock-based compensation and non-cash impairment loss. A reconciliation of Adjusted EBITDA to net income is set out in the tables at the end of this press release.
About Youngevity International
Youngevity International Inc., (OTCQX: YGYI) (www.YGYI.com) is a fast-growing, innovative, multi-dimensional company that offers a wide range of consumer products and services, primarily through person-to-person selling relationships that comprise a "network of networks." The Company also is a vertically-integrated producer of the finest coffees for the commercial, retail and direct sales channels. The Company was formed after the merger of Youngevity Essential Life Sciences (www.youngevity.com) and Javalution Coffee Company in the summer of 2011. The Company was formerly known as AL International, Inc. and changed its name to Youngevity International Inc. in July 2013.
Safe Harbor Statement
This release includes forward-looking statements on our current expectations and projections about future events, including our continued growth. In some cases forward-looking statements can be identified by terminology such as "may," "should," "potential," "continue," "expects," "anticipates," "intends," "plans," "believes," "estimates," “encouraged” and similar expressions. These statements are based upon current beliefs, expectations and assumptions and are subject to a number of risks and uncertainties, many of which are difficult to predict such as our ability to continue our financial performance. The information in this release is provided only as of the date of this release, and we undertake no obligation to update any forward-looking statements contained in this release based on new information, future events, or otherwise, except as required by law.
|Youngevity International, Inc. and Subsidiaries|
|Condensed Consolidated Statements of Operations|
|(In thousands, except share and per share amounts)|
|Three Months Ended June 30,||Six Months Ended June 30,|
|Cost of revenues||8,195||8,227||16,605||15,142|
|Sales and marketing||1,416||834||2,196||1,996|
General and administrative
|Total operating expenses||11,617||11,025||22,587||20,615|
|Operating income (loss)||1,081||(10||)||2,528||(577||)|
|Other income (loss)||(1||)||227||(1||)||227|
|Interest expense, net||(299||)||(245||)||(555||)||(521||)|
|Total other expense||(300||)||(18||)||(556||)||(294||)|
|Income (loss) before income taxes||781||(28||)||1,972||(871||)|
|Income tax provision||119||8||317||16|
|Net income (loss)||$||662||$||(36||)||$||1,655||$||(887||)|
|Reconciliation of Non-GAAP Measure|
|Adjusted EBITDA to Net Income|
|Three Months Ended June 30,||Six Months Ended June 30,|
|Net Income (loss)||$||662||$||(36||)||$||1,655||$||(887||)|
|Share based compensation||128||182||427||182|