Twinlab Sales Affected By Product Returns, Inventory Reduction
This article was originally published in The Tan Sheet
Executive Summary
Product returns from "major customers" and "inventory reduction" in the herbals and sports nutritional markets has forced Twinlab to lower its projections for fiscal 2000, the firm announced Nov. 15.
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Twinlab Sales To GNC Off 46% In 2000; Lower 2001 Sales Expected
Twinlab sales to GNC stores dropped 45.6% to $35.2 mil. in 2000, President & CEO Ross Blechman said during an April 2 conference call with analysts.
Twinlab
Securities class actions filed against supplement firm and its officers in Islip, N.Y. federal court on behalf of purchasers of Twinlab stock between April 27, 1999 and Nov. 15, 2000. The lawsuits generally allege defendants issued materially false and misleading financial statements and misrepresented sales growth potential, particularly for herbals. The complaints also assert the firm overstated its physical inventory, and that Twinlab stock was artificially inflated as a result of these disclosure violations. On Nov. 15, Twinlab announced product returns from "major customers" and "inventory reduction" in the herbals and sport nutritional markets forced it to lower FY 2000 projections. The company's 10-Q filing with SEC had been delayed due to inventory discrepancies (1"The Tan Sheet" Nov. 20, p. 5)
Twinlab
Ephedra-containing products comprised about 20% of third quarter sales, Chairman & CEO Ross Blechman reports during an analysts call Nov. 11. Although he says recent ephedra studies in prominent medical journals are "old news," Blechman notes the firm is posting strong labeling warnings on products and is preparing for contingencies related to changes in federal policy toward the controversial herbal. Twinlab recorded a net loss of $11.1 mil. for the quarter, compared to income of $2.8 mil. in the 1999 period. Additional earnings details come after the company had to file an extension for its 10-Q due to inventory problems (1"The Tan Sheet" Nov. 20, p. 5)