Medifast Announces First Quarter 2024 Financial Results
First Quarter 2024
-
Revenue of
$174.7 million , with revenue per active earning coach of$4,623 - Independent active earning OPTAVIA Coaches of 37,800
-
Net income of
$8.3 million (non-GAAP adjusted net income of$7.2 million ) -
Earnings per diluted share ("EPS") of
$0.76 (non-GAAP adjusted EPS of$0.66 ) -
Cash, Cash Equivalents, and
Investment Securities of$156.4 million with zero debt
“Fast paced medical innovation is providing greater access to medical weight loss solutions than ever before. We are transforming our OPTAVIA offer to include comprehensive support for consumers who wish to use GLP-1 medical weight loss solutions on their individual journeys to sustainable healthy lifestyles. It’s a market that is estimated by a recent BCG market study to have the potential to grow to
“Our new model is highly differentiated from competitors, with a holistic approach including our habit-based and Coach guided solution along with nutrition products and community support. It will be supported by a reimagined framework for customer acquisition, with a new company-led national marketing campaign, enhancing both awareness of the benefits of our approach, and the visibility of our brand. While 2024 will be a year of investment for future growth, we believe the initiatives we are undertaking will be foundational in creating a platform for sustained company growth in the years ahead.”
First Quarter 2024 Results
First quarter 2024 revenue decreased 49.9% to
Gross profit decreased 48.3% to
Selling, general, and administrative expenses (“SG&A”) decreased 38.1% to
Income from operations decreased 85.2% to
The effective tax rate was 28.2% for the first quarter of 2024 compared to 25.1% in the prior-year period. The increase in the effective tax rate from the three months ended
In the first quarter of 2024, net income was
Capital Allocation and Balance Sheet
The company’s balance sheet remains strong with
Outlook
The company expects second quarter 2024 revenue to be in the range of
Conference Call Information
The conference call is scheduled for today,
About
MED-F
Forward Looking Statements
Please Note: This release contains "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These forward-looking statements generally can be identified by use of phrases or terminology such as "intend," "anticipate," "expect" or other similar words or the negative of such terminology. Similarly, descriptions of
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CONDENSED CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED) |
||||||
( |
||||||
|
Three Months Ended |
|||||
|
|
2024 |
|
|
2023 |
|
|
|
|
|
|||
Revenue |
$ |
174,739 |
|
$ |
348,983 |
|
Cost of sales |
|
47,447 |
|
|
102,593 |
|
Gross profit |
|
127,292 |
|
|
246,390 |
|
|
|
|
|
|||
Selling, general, and administrative |
|
119,352 |
|
|
192,879 |
|
|
|
|
|
|||
Income from operations |
|
7,940 |
|
|
53,511 |
|
|
|
|
|
|||
Other income (expense) |
|
|
|
|||
Interest income (expense) |
|
1,223 |
|
|
(181 |
) |
Other income (expense) |
|
2,422 |
|
|
(1 |
) |
|
|
3,645 |
|
|
(182 |
) |
|
|
|
|
|||
Income from operations before income taxes |
|
11,585 |
|
|
53,329 |
|
|
|
|
|
|||
Provision for income taxes |
|
3,269 |
|
|
13,361 |
|
|
|
|
|
|||
Net income |
$ |
8,316 |
|
$ |
39,968 |
|
|
|
|
|
|||
Earnings per share - basic |
$ |
0.76 |
|
$ |
3.68 |
|
|
|
|
|
|||
Earnings per share - diluted |
$ |
0.76 |
|
$ |
3.67 |
|
|
|
|
|
|||
Weighted average shares outstanding |
|
|
|
|||
Basic |
|
10,909 |
|
|
10,864 |
|
Diluted |
|
10,958 |
|
|
10,899 |
|
|
|
|
|
|||
Cash dividends declared per share |
$ |
— |
|
$ |
1.65 |
|
CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED)
( |
|||||
|
|
|
|
||
|
|
|
|
||
ASSETS |
|
|
|
||
Current Assets |
|
|
|
||
Cash and cash equivalents |
$ |
97,471 |
|
$ |
94,440 |
Inventories |
|
46,273 |
|
|
54,591 |
Investments |
|
58,957 |
|
|
55,601 |
Income taxes, prepaid |
|
5,471 |
|
|
8,727 |
Prepaid expenses and other current assets |
|
11,412 |
|
|
10,670 |
Total current assets |
|
219,584 |
|
|
224,029 |
|
|
|
|
||
Property, plant and equipment - net of accumulated depreciation |
|
50,986 |
|
|
51,467 |
Right-of-use assets |
|
14,536 |
|
|
15,645 |
Other assets |
|
13,648 |
|
|
14,650 |
Deferred tax assets |
|
4,005 |
|
|
4,117 |
|
|
|
|
||
TOTAL ASSETS |
$ |
302,759 |
|
$ |
309,908 |
|
|
|
|
||
LIABILITIES AND STOCKHOLDERS' EQUITY |
|
|
|
||
Current Liabilities |
|
|
|
||
Accounts payable and accrued expenses |
$ |
71,229 |
|
$ |
86,415 |
Current lease obligations |
|
5,958 |
|
|
5,885 |
Total current liabilities |
|
77,187 |
|
|
92,300 |
|
|
|
|
||
Lease obligations, net of current lease obligations |
|
14,611 |
|
|
16,127 |
Total liabilities |
|
91,798 |
|
|
108,427 |
|
|
|
|
||
Stockholders' Equity |
|
|
|
||
Common stock, par value |
|
|
|
||
10,937 and 10,896 issued and outstanding |
|
|
|
||
at |
|
11 |
|
|
11 |
Additional paid-in capital |
|
27,963 |
|
|
26,573 |
Accumulated other comprehensive income |
|
22 |
|
|
248 |
Retained earnings |
|
182,965 |
|
|
174,649 |
Total stockholders' equity |
|
210,961 |
|
|
201,481 |
|
|
|
|
||
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY |
$ |
302,759 |
|
$ |
309,908 |
Non-GAAP Financial Measures
In an effort to provide investors with additional information regarding the company's results, the company discloses various non-GAAP financial measures in its quarterly earnings press release and other public disclosures. The following GAAP financial measures have been presented on an as adjusted basis: SG&A expenses, income from operations, other income (expense), provision for income taxes, net income and diluted EPS. Each of these non-GAAP financial measures excludes the impact of certain amounts to initiate and operationalize the LifeMD collaboration and unrealized gains on investment in LifeMD common stock as further identified below and have not been calculated in accordance with GAAP. A reconciliation of each of these non-GAAP financial measures to its most comparable GAAP financial measure is included below. These non-GAAP financial measures are not intended to replace GAAP financial measures.
The company uses these non-GAAP financial measures internally to evaluate and manage the company's operations because it believes they provide useful supplemental information regarding the company's on-going economic performance. The company has chosen to provide this information to investors to enable them to perform more meaningful comparisons of operating results and as a means to emphasize the results of on-going operations.
The following tables reconcile the non-GAAP financial measures included in this release:
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CONDENSED CONSOLIDATED NON-GAAP (UNAUDITED) |
||||||||||||||
( |
||||||||||||||
|
Three months ended |
|||||||||||||
|
GAAP |
|
Unrealized Gain on Investment in LifeMD Common Stock |
LifeMD Prepaid Services Amortization |
|
Non-GAAP |
||||||||
Selling, general, and administrative |
$ |
119,352 |
|
|
$ |
— |
|
$ |
(1,327 |
) |
|
$ |
118,025 |
|
Income from operations |
|
7,940 |
|
|
|
— |
|
|
1,327 |
|
|
|
9,267 |
|
Other income (expense) |
|
3,645 |
|
|
|
(2,841 |
) |
|
— |
|
|
|
804 |
|
Provision for income taxes |
|
3,269 |
|
|
|
(710 |
) |
|
332 |
|
|
|
2,891 |
|
Net income |
|
8,316 |
|
|
|
(2,130 |
) |
|
995 |
|
|
|
7,181 |
|
Diluted earnings per share (1) |
|
0.76 |
|
|
|
(0.19 |
) |
|
0.09 |
|
|
|
0.66 |
|
|
|
|
|
|
|
|
||||||||
|
Three Months Ended |
|||||||||||||
|
GAAP |
|
Unrealized Gain on Investment in LifeMD Common Stock |
LifeMD Prepaid Services Amortization |
|
Non-GAAP |
||||||||
Selling, general, and administrative |
$ |
192,879 |
|
|
$ |
— |
|
$ |
— |
|
|
$ |
192,879 |
|
Income from operations |
|
53,511 |
|
|
|
— |
|
|
— |
|
|
|
53,511 |
|
Other income (expense) |
|
(182 |
) |
|
|
— |
|
|
— |
|
|
|
(182 |
) |
Provision for income taxes |
|
13,361 |
|
|
|
— |
|
|
— |
|
|
|
13,361 |
|
Net income |
|
39,968 |
|
|
|
— |
|
|
— |
|
|
|
39,968 |
|
Diluted earnings per share (1) |
|
3.67 |
|
|
|
— |
|
|
— |
|
|
|
3.67 |
|
(1) |
The weighted-average diluted shares outstanding used in the calculation of these non-GAAP financial measures are the same as the weighted-average shares outstanding used in the calculation of the reported per share amounts. |
View source version on businesswire.com: https://www.businesswire.com/news/home/20240429772740/en/
Investor Contact:
InvestorRelations@medifastinc.com
(443) 379-5256
Source: