Future of supplement maker in the balance
products Health & Nutrition Systems has been called into
question following a substantial downturn in profits in 2001.
The continued future of the Florida-based producer of weight management products, Health & Nutrition Systems, has been called into question following a substantial downturn in profits in 2001.
The company's auditors have said that there is "substantial doubt" over Health & Nutrition Systems' ability to continue as a going concern in light of the significant loss from operations suffered during the year and which were caused primarily by the sharp decline in sales following 11 September.
The company reported sales of US$975,318 for the last three months of 2001 compared to US$1,384,763 for the same period in 2000.
For the year as a whole, the company reported total sales of $5,365,332, a slight decline from $5,404,253 a year earlier. Revenues in 2001 included $1,155,000 generated from the sale of the company's Acutrim weight loss products following the acquisition of the trademark in the first quarter.
Operating profits of $84,204 in 2000 were converted to losses of $1,377,203 as a result of increased advertising costs related to three new products - Acutrim, Fat Cutter and Carbolizer. Net losses for the year were $1,399,533, compared to net income $70,562 for 2000.
The company did not say what its next step would be, but the future looks grim for the supplement producer, and indeed for many other of the smaller players in the market. The market will inevitably recover from the sharp decline at the end of last year, but the question remains as to how many companies will still be operating when it does so?
