Core Insights - FitLife Brands, Inc. reported a 5% decrease in total revenue for Q2 2025, amounting to $16.1 million compared to $16.9 million in Q2 2024 [3][19] - The decline in online revenue was 7%, totaling $10.4 million, which represented 65% of total revenue for the quarter [3][19] - Gross margin decreased to 42.8% from 44.8% year-over-year, primarily due to increased merger and acquisition-related expenses [4][5][19] Financial Performance - Net income for Q2 2025 was $1.7 million, down from $2.6 million in Q2 2024, with basic and diluted earnings per share at $0.19 and $0.18, respectively [5][19] - Adjusted EBITDA decreased by 13% to $3.3 million compared to the same period in 2024, with trailing twelve months adjusted EBITDA at $13.4 million [6][19] - The company ended the quarter with $10.9 million in term loans and $6.6 million in cash, resulting in total net debt of $4.3 million, approximately 0.3x adjusted EBITDA [7][19] Brand Performance - Legacy FitLife revenue increased by 7% year-over-year, driven by a 17% increase in online revenue and a 1% increase in wholesale revenue [11][12] - MRC revenue decreased by 16% compared to Q2 2024, with significant declines in the Dr. Tobias brand and skin care brands due to reduced traffic and tariffs [13][14][15] - MusclePharm revenue decreased by 4%, with wholesale revenue down 6% and online revenue down 3%, although the company is investing in advertising to drive growth [17][18][24] Acquisition Activity - The company completed the acquisition of Irwin Naturals for $42.5 million on August 8, 2025, funded primarily through a new term loan and available cash [20][26] - Irwin Naturals generated approximately $60 million in revenue with a gross margin of about 35% for the trailing twelve months as of June 30, 2025 [25][26] - Management expects to achieve cost savings and improved gross margins as they integrate Irwin Naturals into their operations [26][27]

Core Insights - FitLife Brands, Inc. reported a total revenue of $15.9 million for Q1 2025, a decrease of 4% compared to $16.5 million in Q1 2024 [3][9] - Online revenue accounted for 67% of total revenue, amounting to $10.6 million, which is a 2% decline from the previous year [3][9] - The company's gross margin for the quarter was 43.1%, down from 44.0% in the same period last year [4][9] - Net income for Q1 2025 was $2.0 million, compared to $2.2 million in Q1 2024, with basic and diluted earnings per share at $0.22 and $0.20, respectively [5][9] - Adjusted EBITDA for the quarter was $3.4 million, a 6% decrease from the previous year, bringing the trailing twelve months adjusted EBITDA to $13.9 million [6][9] Revenue Breakdown - Total revenue for the first quarter was $15.9 million, a 4% decrease year-over-year [3][9] - Online sales were $10.6 million, representing 67% of total revenue, down 2% from the previous year [3][9] - Wholesale revenue was $5.3 million, a 7% decrease compared to the same period last year [3][9] Profitability Metrics - Gross margin for Q1 2025 was 43.1%, compared to 44.0% in Q1 2024 [4][9] - Net income decreased to $2.0 million from $2.2 million year-over-year [5][9] - Adjusted EBITDA was $3.4 million, a 6% decrease from the same period in 2024 [6][9] Brand Performance - Legacy FitLife revenue increased by 5% year-over-year, driven by an 11% increase in online revenue and a 2% increase in wholesale revenue [10][11] - MRC revenue decreased by 11% year-over-year, with the largest brand, Dr. Tobias, also seeing an 11% decline [12][13] - MusclePharm revenue decreased by 6%, with wholesale revenue down 41% but online revenue up 33% [15][16] Management Commentary - The CEO noted that the first quarter was strong for Legacy FitLife but challenging for MRC and MusclePharm [20] - The decline in MusclePharm's wholesale revenue was attributed to reduced purchases from a large customer [21] - The company is optimistic about cash flow generation and has a net debt of approximately 0.4x adjusted EBITDA, indicating financial flexibility for potential acquisitions [24]

Financial Data and Key Metrics Changes - For the full year 2024, total revenue increased by 22% year over year to $64.5 million, with online sales growing by 29% and representing 67% of total revenue [3] - Gross profit increased by 31%, and gross margin expanded from 40.7% to 43.6% [3] - Net income rose by 70% to $9 million, with basic EPS increasing by 66% to $0.98 and fully diluted EPS increasing by 69% to $0.91 [3] - Adjusted EBITDA for the full year increased by 39% to $14.1 million [4] - For Q4 2024, total revenue increased by 13% to $15 million, with online revenue increasing by 12% to $10.1 million [4] Business Line Data and Key Metrics Changes - Legacy Fitlife revenue for Q4 2024 was $5.3 million, with a 20% decline in wholesale revenue and a 1% decline in online revenue, totaling a 13% decline [5][6] - MRC revenue for Q4 2024 was $6.9 million, down slightly by 0.4% year over year, but gross margin increased from 40.4% to 48.7% [9][10] - MusclePharm revenue for Q4 2024 was the strongest since acquisition, with total revenue increasing by 14% sequentially, driven by a 37% increase in wholesale revenue [13][14] Market Data and Key Metrics Changes - The company expects MRC online revenue to decline by 10-13% in Q1 2025 due to tough year-over-year comparisons [11] - The first quarter of 2025 is anticipated to see a consolidated revenue decline of 4% to 6% compared to Q1 2024, primarily due to MRC's performance [18] Company Strategy and Development Direction - The company is focused on increasing promotional spending to drive sales growth, particularly for MusclePharm, while managing gross margins [14][45] - The company is actively evaluating M&A opportunities, prioritizing larger transactions while maintaining a strong balance sheet [19][55] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism for Q1 2025, expecting strong performance for legacy Fitlife despite challenges in Q4 2024 [8] - The company is taking steps to mitigate tariff impacts by exploring alternative sourcing options, particularly from India [24][28] - Management noted that while there is uncertainty in the market, they are seeing an uptick in deal flow, particularly from over-leveraged companies [60] Other Important Information - The company completed a two-for-one forward stock split on February 7, 2025, with all per-share amounts adjusted retroactively [3] - The balance sheet remains strong, with net debt at $8.6 million, equivalent to 0.6 times the company's LTM adjusted EBITDA [4][19] Q&A Session Summary Question: What is the potential tariff impact and sourcing from China? - The company does not source products from China but is assessing where manufacturers obtain ingredients, with India emerging as a promising alternative [22][24] Question: What are the dynamics affecting MRC's performance? - The decline in MRC revenue is attributed to tough year-over-year comparisons and changes in customer purchasing behavior [29][30] Question: What are the expectations for MusclePharm's ramp-up throughout the year? - The company is optimistic about MusclePharm's growth potential, particularly with new product launches and rebranding efforts [39][42] Question: Can gross margins be increased? - Gross margins could be increased by stopping promotional spending, but the focus is on growth rather than immediate margin improvement [71][73] Question: What is the company's approach to promotional expenses? - Promotional expenses are used to incentivize retailers to promote products, and the company can adjust these as needed based on performance [45][51]

Financial Data and Key Metrics Changes - For the full year 2024, total revenue increased by 22% year over year to $64.5 million, with online sales growing by 29% and representing 67% of total revenue [3][4] - Gross profit increased by 31%, and gross margin expanded from 40.7% to 43.6% [3] - Net income rose by 70% to $9 million, with basic EPS increasing by 66% to $0.98 and fully diluted EPS increasing by 69% to $0.91 [3] - Adjusted EBITDA for the full year increased by 39% to $14.1 million [4] - For Q4 2024, total revenue increased by 13% to $15 million, with online revenue increasing by 12% to $10.1 million [4] Business Line Data and Key Metrics Changes - Legacy Fitlife revenue for Q4 2024 was $5.3 million, with a 20% decline in wholesale revenue and a 1% decline in online revenue, totaling a 13% decline [5][6] - MRC revenue for Q4 2024 was $6.9 million, down slightly by 0.4% year over year, but gross margin increased from 40.4% to 48.7% [9][10] - MusclePharm revenue for Q4 2024 was the strongest since acquisition, with total revenue increasing by 14% sequentially, driven by a 37% increase in wholesale revenue [13][14] Market Data and Key Metrics Changes - The company expects MRC online revenue to decline by 10-13% in Q1 2025 due to tough year-over-year comparisons [11] - The first quarter of 2025 is anticipated to see a consolidated revenue decline of 4% to 6% compared to the first quarter of 2024 [18] Company Strategy and Development Direction - The company is focused on transitioning to direct fulfillment for GNC franchisees after resolving a commercial dispute [8] - There is an ongoing effort to optimize the skincare brands acquired in the MRC transaction, which had unprofitable revenue [10] - The company is actively evaluating M&A opportunities, prioritizing larger transactions while maintaining a strong balance sheet [19][20] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism for Q1 2025, expecting strong performance for legacy Fitlife despite challenges in wholesale [9] - The company is taking proactive steps to mitigate potential tariff impacts by sourcing ingredients from alternative suppliers [24][28] - Management noted that while there is uncertainty in the market, they are seeing an uptick in deal flow, particularly from over-leveraged companies [60] Other Important Information - The company completed a two-for-one forward stock split on February 7, 2025, with all per-share amounts adjusted retroactively [3] - The balance sheet remains strong, with net debt at $8.6 million, equivalent to 0.6 times the company's LTM adjusted EBITDA [4][19] Q&A Session Summary Question: What is the potential tariff impact and sourcing from China? - The company does not source products from China but is assessing where manufacturers obtain ingredients, with India emerging as a promising alternative [22][24] Question: What are the dynamics affecting MRC business? - The decline in MRC revenue is attributed to tough year-over-year comparisons and changes in customer purchasing behavior [29][34] Question: What are the expectations for MusclePharm's ramp-up? - The company is optimistic about MusclePharm's growth potential but cannot provide specific numbers at this time [39][42] Question: How does promotional spending affect gross margins? - Promotional spending is typical in the industry and is accounted for as a reduction in gross revenue, impacting reported gross margins [45][49] Question: What is the company's approach to M&A targets? - The company is looking for larger M&A opportunities and can leverage its strong balance sheet to finance acquisitions [56][60] Question: What were MusclePharm's peak sales and future potential? - MusclePharm's peak revenue was over $175 million, and the company aims to recover a significant portion of that in the future [63][66]