Tue, May 14, 8:18 PM (73 days ago)
Natural Alternatives International, Inc. (NAI) reported a challenging third quarter ending March 31, 2024. Revenue declined 23% year-over-year to $25.1 million, with private-label contract manufacturing sales dropping 26% due to reduced orders from major customers. Patent and trademark licensing revenues saw a 13% increase, attributed to higher royalty income. Gross profit improved slightly by 40% to $1.9 million, but the gross margin remained low at 7.6%. Operating loss narrowed to $1.95 million from $2.49 million in the prior year, while net loss decreased to $1.58 million from $2.38 million. Cash flow from operations was positive at $1.2 million, aided by significant reductions in inventory. However, the company faced compliance issues with its credit facility, leading to a Fourth Amendment with Wells Fargo, reducing the credit line to $12.5 million and increasing interest rates. Despite these challenges, NAI expects to reopen its Carlsbad facility in May 2024 and anticipates a net loss for the fiscal year. The company's liquidity position remains stable with $12.4 million in cash and cash equivalents.