LONG BEACH, Calif., and LONGMONT, Colo., July 1, 2002 (PRIMEZONE) -- Hauser, Inc. (OTCBB:HAUS) today reported its financial results for the fiscal 2002 fourth quarter and full year ended March 31, 2002.
For the fiscal 2002 fourth quarter, total revenues were $14.3 million compared with $14.5 million in the corresponding year-earlier quarter. Net loss decreased to $1.5 million, or $0.26 per share, from net loss of $23.1 million, or $4.56 per share, in the corresponding quarter a year ago. Loss from operations was $1.5 million, compared with loss from operations of $22.4 million in the same quarter a year ago. Excluding restructuring charges of $927,000 in the fiscal 2002 fourth quarter and $17.8 million in the fiscal 2001 fourth quarter, loss from operations would have been $575,000 and $4.6 million, respectively.
For the fiscal year ended March 31, 2002, total revenues were $57.6 million, compared with $66.7 million a year ago. Net loss significantly narrowed to $5.4 million, or $0.96 per share, compared with net loss in the prior year of $33.3 million, or $6.75 per share. Loss from operations totaled $4.2 million, compared with loss from operations of $32.7 million in fiscal 2001. Excluding restructuring charges of $2.9 million in fiscal 2002 and $17.8 million in fiscal 2001, loss from operations would have been $1.3 million and $14.8 million, respectively.
"In fiscal 2002, we made excellent progress on our plan to refocus on our businesses of producing and marketing bulk herbal extracts and nutritional substances," said Kenneth Cleveland, president and chief executive officer. "We did this by divesting a non-core business, lowering operating expenses as well as cost of revenues, and streamlining our manufacturing operations. Also, we were successful in lowering inventory levels and improving collections of accounts receivables."
The company also said that its credit agreement with Wells Fargo Bank was amended on June 25, 2002 to provide for a termination date of August 31, 2002 instead of August 31, 2003 in exchange for Wells Fargo Bank agreeing to waive defaults under the agreement. The auditors for Hauser have delivered an opinion in connection with the audit for the fiscal year ending March 31, 2002 stating that, because of significant operating losses, the existing deficit and the lack of certainty as to a credit line to finance operations, there is substantial doubt regarding the ability of Hauser to continue as a going concern. Cleveland said, "Hauser is engaged in discussions, including regarding the sale of Shuster Laboratories, which could result in Hauser obtaining funds to pay the Wells Fargo Bank loans and permit Hauser to obtain a new line of credit to finance operations." He added: "There can be no assurance that the discussions will produce the desired result."
Hauser, headquartered in Long Beach, California and Longmont, Colorado, is a leading supplier of herbal extracts and nutritional supplements. Hauser also provides interdisciplinary laboratory testing services, chemical engineering services, and contract research and development. Hauser's products and services are principally marketed to the pharmaceutical, dietary supplement and food ingredient businesses. Hauser's business units include: Botanicals International, Shuster Laboratories, ZetaPharm and Hauser Contract Research Organization.
Certain oral and written statements of management of the Company included in this Press Release and elsewhere may contain forward-looking statements within the meaning of Section 27A of the Securities Exchange Act of 1933 and Section 21E of the Securities Exchange Act of 1934, which are intended to be covered by the safe harbors created thereby. These statements include the plans and objectives of management for future operations. The forward-looking statements included herein and elsewhere are based on current expectations that involve judgments which are difficult or impossible to predict accurately and many of which are beyond the control of the Company. Although the Company believes that the assumptions underlying the forward-looking statements are reasonable, any of the assumptions could be inaccurate and, therefore, there can be no assurance that the forward-looking statements will prove to be accurate. In light of the significant uncertainties inherent in the forward-looking statements, the inclusion of such information should not be regarded as a representation by the Company or any other person that the objectives and plans of the Company will be achieved.
HAUSER, INC.
CONSOLIDATED BALANCE SHEETS
(In thousands)
Year Ended March 31,
ASSETS 2002 2001
-------- --------
CURRENT ASSETS:
Cash and cash equivalents $ 452 $ 616
Accounts receivable, less
allowance for doubtful accounts:
2002, $896; 2001, $876 9,707 12,270
Inventory, at lower of cost or market 7,513 9,802
Prepaid expenses and other 1,221 928
-------- --------
Total current assets 18,893 23,616
-------- --------
PROPERTY AND EQUIPMENT:
Land and buildings 9,552 8,968
Laboratory and processing equipment 11,127 17,402
Furniture and fixtures 2,338 3,588
-------- --------
Total property and equipment 23,017 29,958
Accumulated depreciation and amortization (11,542) (17,258)
-------- --------
Net property and equipment 11,475 12,700
-------- --------
OTHER ASSETS:
Goodwill, less accumulated amortization:
2002, $1,495; 2001, $1,273 726 948
Deposits and other 871 575
-------- --------
$ 31,965 $ 37,839
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LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Accounts payable $ 3,418 $ 2,833
Current portion of long-term debt 16,455 18,790
Current portion of note payable
to related party 2,823 --
Accrued salaries and benefits 1,832 1,300
Customer deposits 543 643
Accrued exit costs 251 508
Amount due to related party 2,946 2,988
Other current liabilities 2,517 2,826
-------- --------
Total current liabilities 30,785 29,888
-------- --------
LONG-TERM DEBT -- 36
NOTE PAYABLE TO RELATED PARTY -- 2,705
COMMITMENTS AND CONTINGENCIES
STOCKHOLDERS' EQUITY:
Common stock, $.001 par value;
20,000,000 shares authorized;
shares issued and outstanding;
2002, 5,921,768; 2001, 5,072,742 6 5
Additional paid-in capital 95,386 94,543
Warrants 886 354
Accumulated deficit (95,098) (89,692)
-------- --------
1,180 5,210
-------- --------
$ 31,965 $ 37,839
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HAUSER, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except share amounts)
Quarter Ended March 31, Year Ended March 31,
2002 2001 2002 2001
--------- --------- --------- ---------
REVENUES:
Dietary Supplements $ 7,680 $ 8,234 $ 32,059 $ 39,127
Pharmaceutical and
functional
ingredients 1,874 1,904 6,375 10,670
Technical services 4,785 4,323 19,188 16,246
Other -- 3 -- 671
--------- --------- --------- ---------
Total revenues 14,339 14,464 57,622 66,714
--------- --------- --------- ---------
COST OF REVENUES:
Dietary Supplements 5,981 4,148 24,707 35,522
Pharmaceutical and
functional
ingredients 1,574 1,639 5,320 9,845
Technical services 3,546 3,774 14,402 14,097
Write-down of
inventory 212 4,498 212 4,498
--------- --------- --------- ---------
Total cost of
revenues 11,313 14,059 44,641 63,962
--------- --------- --------- ---------
GROSS PROFIT 3,026 405 12,981 2,752
--------- --------- --------- ---------
OPERATING EXPENSES:
New product
development 642 762 2,580 2,586
Sales and marketing 886 671 3,374 3,621
General and
administrative 2,073 3,546 8,319 11,394
Restructuring charge 927 17,844 2,884 17,844
--------- --------- --------- ---------
Total operating
expenses 4,528 22,823 17,157 35,445
--------- --------- --------- ---------
LOSS FROM OPERATIONS (1,502) (22,418) (4,176) (32,693)
--------- --------- --------- ---------
OTHER INCOME (EXPENSE):
Interest and other
income 2 107 12 392
Interest expense (441) (501) (1,653) (2,296)
Gain from sale of
assets 309 (204) 309 1,430
--------- --------- --------- ---------
Total other
(expense) income (130) (598) (1,332) (474)
--------- --------- --------- ---------
LOSS BEFORE INCOME TAX (1,632) (23,016) (5,508) (33,167)
INCOME TAX EXPENSE
(BENEFIT) (107) 94 (103) 94
--------- --------- --------- ---------
NET LOSS $ (1,525) $(23,110) $ (5,405) $(33,261)
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LOSS PER SHARE
BASIC AND DILUTED (0.26) (4.56) (0.96) ($ 6.75)
WEIGHTED AVERAGE SHARES
OUTSTANDING BASIC
AND DILUTED 5,874,217 5,070,117 5,637,735 4,929,473
========= ========= ========= =========
HAUSER, INC.
TABLE OF OPERATING RESULTS EXCLUSIVE OF RESTRUCTURING
(In thousands, except share amounts)
Quarter Ended Year Ended
March 31, March 31,
2002 2001 2002 2001
------------------- ----------------
Loss from operations (1,502) (22,417) (4,176) (32,693)
Restructuring charge 927 17,844 2,884 17,844
------ ------ ----- ------
Loss from operations
exclusive of
restructuring (575) (4,573) (1,292) (14,849)
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