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11/12/2021

Natural Alternatives International sees slight dip in private label

Nutritional supplements company posted Q1 results, saying new customers helped offset the slight declines.
Zachary Russell
Associate Editor
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Natural Alternatives International (NAI), a formulator and manufacturer of customized nutritional supplements, shared its results for Q1 2022, which include a decrease in private label manufacturing sales.

Net sales during the three months ended Sept. 30 decreased $1.4 million, or 3.5%, to $38.3 million as compared to $39.7 million recorded in the comparable prior year period. During the same period, private label contract manufacturing sales decreased to $33.6 million, a 9.3% decrease from the comparable quarter last year.  Private label sales increased for the company in Q4 of 2021.

NAI said that private label contract manufacturing sales decreased primarily due to a 45% decrease in sales to their largest customer primarily associated with their European markets, but added that the decline was largely offset by  increased sales to new and existing customers, including significant sales from a new customer operating in the direct-to-consumer marketplace. Sales backlog for the quarter ended Sept. 30 was over $8.0 million and was primarily related to supply chain and logistical issues.

“Despite a decline in sales from our largest customer, we have been able to make significant progress in growing our business with other customers in a variety of channels, including the recent acquisition of a new direct to consumer based customer we expect will help drive significant future growth for our company,” said Mark Le Doux, chairman and CEO of NAI. “We believe the dietary supplement industry is in a period of meaningful growth, and we find ourselves in the enviable position where we are able to capitalize on new opportunities leveraging our reputation of quality and integrity along with our available equipment capacity supported by the strength of our balance sheet."

Royalties from CarnoSyn beta-alanine, licensing and raw material sales revenue increased 77.1% to $4.7 million during the first quarter of fiscal year 2022, as compared to $2.7 million for the first quarter of fiscal year 2021. The increase was primarily due to increased shipments to existing customers related to athletic activities and gyms reopening in accordance with easing COVID-19 restrictions across the USA.

NAI added that they anticipate the fiscal year 2022 consolidated net sales to increase between 7% and 10% as compared to fiscal year 2021.