Smart Balance announces quarterly results

PARAMUS, N.J. Smart Balance, Inc. announced Thursday its results for the second quarter ended June 30.

The Company reported net sales of $58.2 million, an increase of 21.2% versus year ago, and earnings per share of $0.02, versus a loss of $0.02 per share in 2008. The second-quarter net sales increase versus 2008 was due to a 13% volume growth in case shipments and higher pricing carried over from the prior year. The improvement in earnings per share was due to increased gross profits and lower financing-related costs, partially offset by higher operating expenses.

The company increased market share in its core category of spreads by 1.2 points to 14.8% in the second quarter versus the same quarter in 2008, representing the 30(th) consecutive quarter of market share growth, according to Information Resources, Inc. (IRI) data.

Gross profit margin for the quarter improved 48.6%, versus 41.4% for the second quarter 2008, due to lower commodity costs and higher pricing carried over from 2008, partially offset by higher promotion expenses.

The company paid down debt by $5.0 million during the quarter, bringing total long-term debt to $64.5 million. The Company has reduced debt by $95.5 million, or 60%, since the acquisition of GFA Brands in May, 2007, and expects to continue to pay down debt this year.

The company expects approximately 10% volume growth in case shipments in the second half of 2009, with plans that include launching a Smart Balance sour cream to add to the company's presence in the dairy aisle.

"In a quarter where competitive intensity increased, I am pleased with our continued share growth in our core category of spreads," said Stephen B. Hughes, Smart Balance chairman and CEO. "Consumers have learned that Smart Balance is the company to trust to always deliver the heart healthiest, best tasting spread in the marketplace."