UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES AND EXCHANGE ACT OF 1934
For the period ended June 30, 1997
Commission File Number: 0-10666
-------------
NBTY, Inc.
- -------------------------------------------------------------------------------
(Exact name of registrant as specified in its charter)
Delaware 11-2228617
- ------------------------------------- ---------------------------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
90 Orville Drive, Bohemia, NY 11716
- ---------------------------------------- ------------------------------------
(Address of Principal Executive Offices) (Zip Code)
Registrant's telephone number, including area code (516) 567-9500
----------------
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities and Exchange Act
of 1934 during the preceding 12 months (or for such shorter period that the
registration was required to file such reports), and (2) has been subject to
such filing requirements for the past 90 days.
YES [X] NO [ ]
Shares of Common Stock as of June 30, 1997: 18,628,491
------------
NBTY, INC. and SUBSIDIARIES
INDEX
PART I Financial Information
Condensed Consolidated Balance Sheets - June 30, 1997 and
September 30, 1996 1 - 2
Condensed Consolidated Statements of Operations - Three
Months Ended June 30, 1997 and 1996 3
Condensed Consolidated Statements of Operations - Nine
months Ended June 30, 1997 and 1996 4
Condensed Consolidated Statements of Cash Flows - Nine
months Ended June 30, 1997 and 1996 5 - 6
Notes to Condensed Consolidated Financial Statements 7 - 9
Management's Discussion and Analysis of Financial
Condition and Results of Operations 10 - 13
PART II Other Information 14
Signature 15
NBTY, INC. and SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
ASSETS
<TABLE>
<CAPTION>
June 30, September 30,
1997 1996
------------- -------------
(Unaudited)
<S> <C> <C>
Current assets:
Cash and cash equivalents $ 2,915,318 $ 9,292,374
Short-term investments 15,540,808 11,024,624
Accounts receivable, less allowance for doubtful
accounts of $996,491 in 1997 and $793,669 in 1996 13,012,095 11,625,112
Inventories 58,682,289 38,070,071
Deferred income taxes 3,155,163 3,155,163
Prepaid catalog costs and other current assets 7,648,111 5,682,874
------------------------------
Total current assets 100,953,784 78,850,218
Property, plant and equipment 99,846,582 89,082,883
less accumulated depreciation and amortization 31,398,648 27,351,258
------------------------------
68,447,934 61,731,625
Intangible assets, net 3,748,030 3,974,573
Other assets 514,845 993,785
------------------------------
Total assets $ 173,664,593 $ 145,550,201
==============================
</TABLE>
See notes to condensed consolidated financial statements.
<PAGE> 1
NBTY, INC. and SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
LIABILITIES AND STOCKHOLDERS' EQUITY
<TABLE>
<CAPTION>
June 30, September 30,
1997 1996
------------- -------------
(Unaudited)
<S> <C> <C>
Current liabilities:
Current portion of long-term debt and capital lease
obligations $ 995,225 $ 934,887
Accounts payable 22,807,676 10,943,228
Accrued expenses 15,258,867 14,704,507
------------------------------
Total current liabilities 39,061,768 26,582,622
Long-term debt 14,782,083 15,178,412
Obligations under capital leases 2,863,638 3,219,127
Deferred income taxes 2,827,198 2,827,198
Other liabilities 792,985 792,985
------------------------------
Total liabilities 60,327,672 48,600,344
Commitments and contingencies
Stockholders' equity:
Common stock, $.008 par; authorized 25,000,000 shares;
issued 20,116,676 shares in 1997 and 20,079,676 in
1996 and outstanding 18,628,491 shares in 1997 and
18,592,119 shares in 1996 160,934 160,638
Capital in excess of par 56,303,677 56,012,910
Retained earnings 60,061,732 44,008,465
------------------------------
116,526,343 100,182,013
Less 1,488,185 and 1,487,557 treasury shares at cost,
in 1997 and 1996, respectively 2,663,167 2,648,256
Stock subscriptions receivable 526,255 583,900
------------------------------
Total stockholders' equity 113,336,921 96,949,857
------------------------------
Total liabilities and stockholders' equity $ 173,664,593 $ 145,550,201
==============================
</TABLE>
See notes to condensed consolidated financial statements.
<PAGE> 2
NBTY, INC. and SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(UNAUDITED)
<TABLE>
<CAPTION>
For the three months
ended June 30,
1997 1996
------------ ------------
<S> <C> <C>
Net sales $ 61,760,959 $ 47,899,663
----------------------------
Costs and expenses:
Cost of sales 29,957,848 23,446,374
Catalog printing, postage and promotion 4,639,025 3,690,819
Selling, general and administrative 18,476,018 14,165,346
----------------------------
53,072,891 41,302,539
----------------------------
Income from operations 8,688,068 6,597,124
----------------------------
Other income (charges):
Interest expense (425,312) (378,980)
Miscellaneous, net 285,644 284,545
----------------------------
(139,668) (94,435)
----------------------------
Income before income taxes 8,548,400 6,502,689
Income taxes 3,419,360 2,740,042
----------------------------
Net income $ 5,129,040 $ 3,762,647
============================
Earnings per common share and common share equivalents $ 0.26 $ 0.19
============================
Weighted average common shares and common share equivalents 20,057,856 19,922,954
============================
</TABLE>
See notes to condensed consolidated financial statements.
<PAGE> 3
NBTY, INC. and SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(UNAUDITED)
<TABLE>
<CAPTION>
For the nine months
ended June 30,
1997 1996
------------- -------------
<S> <C> <C>
Net sales $ 184,107,656 $ 142,093,552
------------------------------
Costs and expenses:
Cost of sales 88,205,269 72,101,151
Catalog printing, postage and promotion 14,580,501 13,240,001
Selling, general and administrative 53,884,692 42,782,415
------------------------------
156,670,462 128,123,567
------------------------------
Income from operations 27,437,194 13,969,985
------------------------------
Other income (charges):
Interest expense (1,294,232) (1,017,497)
Miscellaneous, net 612,483 640,730
------------------------------
(681,749) (376,767)
------------------------------
Income before income taxes 26,755,445 13,593,218
Income taxes 10,702,178 5,505,398
------------------------------
Net income $ 16,053,267 $ 8,087,820
==============================
Earnings per common share and common share equivalents $ 0.80 $ 0.41
==============================
Weighted average common shares and common share equivalents 20,052,391 19,939,042
==============================
</TABLE>
See notes to condensed consolidated financial statements.
<PAGE> 4
NBTY, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
<TABLE>
<CAPTION>
For the nine month
ended June 30,
1997 1996
------------ ------------
<S> <C> <C>
Net income $ 16,053,267 $ 8,087,820
Adjustments to reconcile net income to cash provided by
operating activities:
(Gain), Loss on sale of property, plant and equipment 25,526 (2,250)
Depreciation and amortization 4,582,566 4,003,164
Provision for allowance for doubtful accounts 202,822 169,481
Changes in assets and liabilities, net of acquistions:
(Increase) decrease in accounts receivable (2,636,906) 797,534
(Increase) decrease in inventories (20,612,218) 229,671
Increase in prepaid catalog costs and other current assets (1,965,237) (4,499,475)
Decrease other assets 453,343 2,547,275
Increase (decrease) in accounts payable 11,864,448 (5,083,382)
Increase in accrued expenses 880,193 2,298,094
----------------------------
Net cash provided by operating activities 8,847,804 8,547,932
----------------------------
Cash flow from investing activities:
Increase in intangible assets (40,047)
Purchase of property, plant and equipment (11,092,412) (11,494,483)
Proceeds from sale of property, plant and equipment 20,150 2,250
Purchase of short-term investments (4,516,184)
Proceeds from sale of direct-mail cosmetics business 350,000
Receipt of payments from direct-mail cosmetics business 1,047,101 499,670
----------------------------
Net cash used in investing activities (14,541,345) (10,682,610)
----------------------------
Cash flows from financing activities:
Borrowings under long term debt agreements 6,000,000
Principal payments under long-term debt agreements and
capital leases (691,479) (368,248)
Purchase of treasury stock (14,911) (302,247)
Proceeds from stock options exercised 22,875 10,980
----------------------------
Net cash (used in) provided by financing activities (683,515) 5,340,485
----------------------------
Net (decrease) increase in cash and cash equivalents (6,377,056) 3,205,807
Cash and cash equivalents at beginning of year 9,292,374 10,378,476
----------------------------
Cash and cash equivalents at end of quarter $ 2,915,318 $ 13,584,283
============================
Supplemental Disclosure of Cash Flow Information:
Cash paid during the period for interest $ 1,294,232 $ 1,012,622
Cash paid during the period for taxes $ 11,067,626 $ 2,178,025
============================
</TABLE>
See notes to consolidated condensed financial statements.
<PAGE> 5
NBTY, INC. and SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
For the nine months ended June 30, 1997 and 1996
Supplemental non-cash investing and financing information:
The Company entered into capital leases for machinery and equipment aggregating
$2,635,412 for the nine months ended June 30, 1996.
During the first nine months of 1997, options were exercised with 37,000 shares
of common stock issued to certain officers for $22,875 and a note for
$10,980. As a result of the exercise of those options, the Company received
a compensation deduction for tax purposes of approximately $643,000 and a
tax benefit of approximately $257,200. An additional 628 NBTY common shares
were surrendered to the Company, at market price, in payment of a stock
subscription receivable and interest in 1997. The average cost of shares
was $22.50 in 1997.
During the first nine months of fiscal 1996, options were exercised with
872,000 shares of common stock issued to certain officers for $10,980 and
interest bearing notes in the amount of $583,900. As a result of the
exercise of those options, the Company received a compensation deduction
for tax purposes of approximately $3,150,000 and a tax benefit of
approximately $1,230,000.
On October 9, 1995, the Company sold certain assets of its direct- mail
cosmetics business for approximately $2,495,000. The Company received
$350,000 in cash and non-interest bearing notes aggregating approximately
$2,145,000 for inventory, a customer list and other intangible assets. The
inventory note was repaid in full in October 1996. In April 1997, the
Company received $725,000 as a final payment of the customer list note.
See notes to condensed consolidated financial statements.
<PAGE> 6
NBTY, INC. and SUBSIDIARIES
NOTES to CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
1. In the opinion of the Company, the accompanying unaudited condensed
consolidated financial statements contain all adjustments necessary to
present fairly its financial position as of June 30, 1997 and results of
operations for the three and nine months ended June 30, 1997 and 1996 and
statements of cash flows for the nine months ended June 30, 1997 and
1996. The consolidated condensed balance sheet as of September 30, 1996
has been derived from the audited balance sheet as of that date. This
report should be read in conjunction with the Company's annual report
filed on Form 10-K for the fiscal year ended September 30, 1996.
2. The results of operations and cash flows for the nine months ended June 30,
1997 are not necessarily indicative of the results to be expected for the
full year.
3. Sale of Direct-Mail Cosmetic Business:
On October 9, 1995, the Company sold certain assets of its direct-mail
cosmetics business for approximately $2,495,000. The Company received
$350,000 in cash and non-interest bearing notes aggregating approximately
$2,145,000 for inventory, a customer list and other intangible assets.
The inventory note was repaid in full in October 1996. In April 1997, the
Company received $725,000 as a final payment of the customer list note.
4. Inventories have been estimated by using the gross profit method for the
interim periods. The components of the inventories are as follows:
<TABLE>
<CAPTION>
June 30, September 30,
1997 1996
------------ -------------
(UNAUDITED)
<S> <C> <C>
Raw materials and work-in-process $ 35,023,137 $ 18,654,335
Finished goods 23,659,152 19,415,736
----------------------------
$ 58,682,289 $ 38,070,071
============================
</TABLE>
5. Intangible assets, at cost, acquired at various dates are as follows:
<TABLE>
<CAPTION>
June 30, September 30,
1997 1996
------------ -------------
(UNAUDITED)
<S> <C> <C>
Goodwill $ 469,400 $ 469,400
Customer lists 8,783,475 8,783,475
Trademark and licenses 1,201,205 1,201,205
Covenants not to compete 1,304,538 1,304,538
----------------------------
11,758,618 11,758,618
Less, accumulated amortization 8,010,588 7,784,045
----------------------------
$ 3,748,030 $ 3,974,573
============================
</TABLE>
<PAGE> 7
NBTY, INC. and SUBSIDIARIES
NOTES to CONDENSED CONSOLIDATED FINANCIAL STATEMENTS, Continued
6. Accrued expenses:
<TABLE>
<CAPTION>
June 30, September 30,
1997 1996
------------ -------------
(UNAUDITED)
<S> <C> <C>
Payroll and related payroll taxes $ 3,286,118 $ 2,730,453
Customer deposits 2,499,656 1,862,837
Accrued purchases 935,110 1,765,420
Income taxes payable 2,115,214 2,670,270
Other 6,422,769 5,675,527
----------------------------
$ 15,258,867 $ 14,704,507
============================
</TABLE>
7. The Company purchased 46,000 shares of its common stock for $302,247 for the
nine months ended June 30, 1996 in open market transactions. The average
price per share was $6.57. An additional 628 NBTY common shares were
surrendered to the Company at market price in payment of a stock
subscription receivable and interest in 1997. The average cost of shares
was $22.50 in 1997.
8. Earnings per share are based on the weighted average number of common shares
and common equivalent shares outstanding during the three and nine month
periods ended June 30, 1997 and 1996. The calculation of earnings per
share include 1,429,365 and 1,393,347 common stock equivalent shares for
the three months periods ended June 30, 1997 and 1996, respectively. The
calculation of earnings per share include 1,441,560 and 1,501,084 common
stock equivalent shares for the nine month periods ended June 30, 1997
and 1996, respectively.
9. During the first nine months of 1997, options were exercised with 37,000
shares of common stock issued to certain officers and a director for
$22,875 and a note for $10,980. As a result of the exercise of those
options, the Company received a compensation deduction for tax purposes
of approximately $643,000 and a tax benefit of approximately $257,200. An
additional 628 NBTY common shares were surrendered to the Company, at
market price, in payment of a stock subscription receivable and interest
in 1997. The average cost of shares was $22.50 in 1997.
During the first nine months of 1996, options were exercised with 872,000
shares of common stock issued to certain officers for $10,980 and
interest bearing notes in the amount of $583,900. As a result of the
exercise of those options, the Company received a compensation deduction
for tax purposes of approximately $3,150,000 and a tax benefit of
approximately $1,230,000.
In November 1995, options were exercised with shares of common stock issued
to certain officers for an interest bearing note in the amount of
$437,500. As a result of the exercise of those options, the Company
received a compensation deduction for tax purposes of approximately
$2,362,500 and a tax benefit of approximately $920,000.
<PAGE> 8
NBTY, INC. and SUBSIDIARIES
NOTES to CONDENSED CONSOLIDATED FINANCIAL STATEMENTS, Continued
9. Stock options (continued):
The following is a summary of changes in outstanding options for the
Company's Stock Option Plans for the nine month period ended June 30,
1997:
<TABLE>
<CAPTION>
Exercise Price
--------------
<S> <C> <C>
Shares under option, September 30, 1996
(fully exercisable) 1,523,000 $.63 - $.92
Options exercised (37,000) $.92
---------
Shares exercisable, June 30, 1997
(fully exercisable) 1,486,000 $.63 - $.92
=========
</TABLE>
10. Subsequent event:
The Company has entered into negotiations to acquire a vitamin and health
food retailer that operates 410 stores in the United Kingdom. The Company
would finance the purchase with bonds and borrowings through a U.S. bank.
The Company has not reached an agreement in principle in connection with
this potential transaction.
<PAGE> 9
NBTY, INC. and SUBSIDIARIES
MANAGEMENT'S DISCUSSION and ANALYSIS of FINANCIAL
CONDITION and RESULTS of OPERATIONS
Results of Operations:
The following table sets forth income statement data of the Company as a
percentage of net sales for the periods indicated:
<TABLE>
<CAPTION>
Three months Nine months
ended ended
June 30, June 30,
---------------- ----------------
1997 1996 1997 1996
------ ------ ------ ------
<S> <C> <C> <C> <C>
Net sales . . . . . . . . . . . . . . . . . . 100.0% 100.0% 100.0% 100.0%
Cost and expenses:
Cost of sales . . . . . . . . . . . . . . . 48.5 48.9 47.9 50.7
Catalog printing, postage and promotion . . 7.5 7.7 7.9 9.3
Selling, general and administrative . . . . 29.9 29.6 29.3 30.1
-----------------------------------
85.9 86.2 85.1 90.1
-----------------------------------
Income from operations . . . . . . . . . . . . 14.1 13.8 14.9 9.9
Other income (expenses), net . . . . . . . . . (0.3) (0.2) (0.4) (0.3)
-----------------------------------
Income before income taxes . . . . . . . . . . 13.8 13.6 14.5 9.6
Income taxes . . . . . . . . . . . . . . . . 5.5 5.7 5.8 3.9
-----------------------------------
Net income . . . . . . . . . . . . . . . . . . 8.3% 7.9% 8.7% 5.7%
===================================
</TABLE>
Results of Operations
- ---------------------
For the three months ended June 30, 1997 compared to the three months ended
June 30, 1996:
Net sales. Net sales in the third quarter ended June 30, 1997 were
$61,760,959 compared with $47,899,663 for the prior comparable period,
an increase of $13,861,296 or 28.9%. Sales increases were across all
channels of distribution. Mail order sales were $25.5 million, compared
to $21.4 for the prior comparable period (increase of $4.1 million or
19.1%), wholesale sales were $25.4 million compared to $21.2 million
(increase of $4.2 million or 20.1%) and retail operations were $10.8
million compared to $5.3 million (increase of $5.5 million or 103.1%)
due to an increase in the number of retail stores over the comparable
period. Comparable store sales for stores open for more than one year
were up $1,318,023 (or 27.8%) over the quarter ended June 30, 1996.
Costs and expenses. Cost of sales as a percentage of sales was 48.5% for
1997 and 48.9% for 1996. The decrease was associated with changes in
product mix.
Catalog printing, postage, and promotion expenses were $4,639,025 in 1997,
an increase of $948,206 (25.7% increase), from $3,690,819 in 1996. The
increase was primarily attributable to national television advertising
for the mail order division. As a percentage of sales, expenses were
7.5% for the current quarter and 7.7% for the prior comparable quarter.
<PAGE> 10
NBTY, INC. and SUBSIDIARIES
MANAGEMENT'S DISCUSSION and ANALYSIS of FINANCIAL
CONDITION and RESULTS of OPERATIONS
Results of Operations (continued)
- ---------------------------------
For the three months ended June 30, 1997 compared to the three months ended
June 30, 1996:
Selling, general and administrative expenses were $18,476,018 for the
quarter, or 29.9% as a percentage of sales, compared with $14,165,346,
or 29.6% as a percentage of sales, an increase of $4,310,672 (30.4%
increase). The largest segments are indirect salaries and payroll
fringe benefits, freight and building. Increases were primarily in
indirect salaries, building, freight and outside services. These
expenses increased due to the retail store expansion and the opening of
the international mail order operations.
Other income includes rental income of $57,401 and $135,663 in 1997 and
1996, respectively.
Income before income taxes was $8,548,400 for 1997 and $6,502,689 for 1996.
After income taxes, the Company had a net profit of $5,129,040 (or
earnings per share of $0.26) for the three month period ended June 30,
1997, and $3,762,647 (or earnings per share of $0.19) for the three
months ended June 30, 1996.
For the nine months ended June 30, 1997 compared to the nine months ended
June 30, 1996:
Net sales. Net sales in the nine months ended June 30, 1997 were
$184,107,656 compared with $142,093,552 for the prior comparable
period, an increase of $42,014,104 or 29.6%. Sales increases were
across all channels of distribution. Mail order sales were $78.0
million, compared to $62.9 for the prior comparable period (increase of
$15.1 million or 24.0%), wholesale sales were $77.4 million compared to
$64.4 million (increase of $13.0 million or 20.1%) and retail
operations were $28.7 million compared to $14.7 million (increase of
$14.0 million or 95.8%) due to an increase in the number of retail
stores over the comparable periods. Comparable store sales for stores
open for more than one year were up $1,845,553 (or 15.1%) over the nine
months ended June 30, 1996. Approximately 70 new products were
introduced over the past nine months. Sales for the Company's new mail
order operation in the United Kingdom were $1.6 million in 1997 and
$0.5 in 1996.
Costs and expenses. Cost of sales as a percentage of sales was 47.9% for
1997 and 50.7% for 1996. The decrease was associated with lower raw
material costs, manufacturing efficiencies and changes in product mix.
Catalog printing, postage, and promotion expenses were $14,580,501 in 1997,
an increase of $1,340,500 (10.1% increase), from $13,240,001 in 1996.
As a percentage of sales, expenses were 7.9% for the current nine
months and 9.3% for the prior comparable nine months. The increase in
expenditures was primarily attributable to national television
advertising and number of catalogs mailed for the mail order division.
<PAGE> 11
NBTY, INC. and SUBSIDIARIES
MANAGEMENT'S DISCUSSION and ANALYSIS of FINANCIAL
CONDITION and RESULTS of OPERATIONS
Results of Operations (continued)
- ---------------------------------
For the nine months ended June 30, 1997 compared to the nine months ended
June 30, 1996:
Selling, general and administrative expenses were $53,884,692, or 29.3% as
a percentage of sales, compared with $42,782,415, or 30.1% as a
percentage of sales, an increase of $11,102,277 (or 26.0%). The largest
segments are legal, indirect salaries, fringe benefits, freight and
building. Increases were primarily in indirect salaries, building,
freight and outside services. These expenses increased due to the
retail store expansion and the opening of the international mail order
operations.
Other income includes rental income of $291,302 and $406,988 in 1997 and
1996, respectively.
Income before income taxes was $26,755,445 for 1997 and $13,593,218 for
1996. After income taxes, the Company had a net profit of $16,053,267
(or earnings per share of $0.80) for the nine month period ended June
30, 1997, and $8,087,820 (or earnings per share of $0.41) for the nine
months ended June 30, 1996.
Liquidity and Capital Resources
- -------------------------------
The Company believes it has adequate working capital to meet its
obligations in the normal course of business. On April 3, 1996, the
Company renewed a revolving credit agreement with two banks that
provides for unsecured borrowings up to $15,000,000 which expires June
30, 1999. At June 30, 1997, there were no borrowings under this
agreement. In April 1996, the Company obtained a $6,000,000 first
mortgage with a fixed interest rate of 7.375%, collateralized by the
underlying real estate. The mortgage has monthly principal and interest
payments of $55,196 for fifteen years through 2011. The Company renewed
a $10,000,000 capital lease facility and has approximately $7 million
remaining available at June 30, 1997.
The Company has entered into negotiations to acquire a vitamin and health
food retailer that operates 410 stores in the United Kingdom. The
Company would finance the purchase with bonds and borrowings through a
U.S. bank. The Company has not reached an agreement in principle in
connection with this potential transaction.
Capital improvements:
The Company has committed to a $4 million automated picking and packing
system for its mail-order distribution which will be funded by lease
financing.
Net cash provided by operating activities was $8,847,804 and $8,547,932 in
1997 and 1996, respectively. Net cash used in investing activities was
$14,541,345 and $10,682,610 in 1997 and 1996, respectively, primarily
for purchases of property, plant and equipment in connection with the
company's capital expansion program. Net cash used in financing
activities was $683,515 in 1997, primarily due to principal payments on
debt and provided by financing activities was $5,340,485 in 1996, due
to borrowings under the revolving credit agreement.
<PAGE> 12
NBTY, INC. and SUBSIDIARIES
MANAGEMENT'S DISCUSSION and ANALYSIS of FINANCIAL
CONDITION and RESULTS of OPERATIONS
Liquidity and Capital Resources (continued)
- -------------------------------------------
On October 9, 1995, the Company sold certain assets of its direct-mail
cosmetics business for approximately $2,495,000. The Company received
$350,000 in cash and non-interest bearing notes aggregating approximately
$2,145,000 for inventory, a customer list and other intangible assets. The
inventory note was repaid in full in October 1996. In April 1997, the
Company received $725,000 as a final payment of the customer list note.
Management believes that inflation did not have a significant impact on
operations.
This filing contains certain forward-looking statements and information to the
Company that are based on the beliefs of management, as well as assumptions
made by and information currently available to the Company's management.
When used in this document, the words "anticipate," "believe," "estimate,"
and "expect" and similar expressions, as they relate to the Company are
intended to identify forward-looking statements. Such statements reflect
the current views of the Company with respect to future events and are
subject to certain risks, uncertainties and assumptions. Should one or more
of these risks or uncertainties materialize, or should underlying
assumptions prove incorrect, actual results may vary materially from those
described herein as anticipated, believed, estimated or expected. The
Company does not intend to update these forward-looking statements.
<PAGE> 13
NBTY, INC. AND SUBSIDIARIES
PART II OTHER INFORMATION
Item 1. Legal Proceedings
LITIGATION:
There have been no material developments with respect to litigation
that occurred during this reporting period. Reference is made to
Item 3, Legal Proceedings in Form 10- K for the year ended
September 30, 1996.
Item 2. Changes in Securities
Not applicable.
Item 3. Defaults upon Senior Securities Not applicable.
Not applicable.
Item 4. Submission of Matters to a Vote of Security Holders
Not applicable.
Item 5. Other Information
Not applicable
Item 6. Exhibits and Reports on Form 8-K
There was no Form 8-K filed during the third quarter of the fiscal year
ending September 30, 1997.
<PAGE> 14
NBTY, INC. and SUBSIDIARIES
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned there unto duly authorized.
NBTY, INC.
---------------------------------------
Date August 5, 1997
/s/ Harvey Kamil
---------------------------------------
Harvey Kamil, Executive Vice President,
Secretary (Principal Financial and
Accounting Officer)
<PAGE> 15
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
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<PERIOD-START> OCT-01-1996
<PERIOD-END> JUN-30-1997
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<SECURITIES> 0
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<ALLOWANCES> 996,491
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<DEPRECIATION> 31,398,648
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<CURRENT-LIABILITIES> 39,061,768
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0
0
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<TOTAL-LIABILITY-AND-EQUITY> 173,664,593
<SALES> 184,107,656
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<CGS> 88,205,269
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</TABLE>
