(RTTNews) - Vitacost.com, Inc. (VITC), an online retailer and direct marketer of health and wellness products, expanded its adjusted profit, revenue and margins in the third quarter. The company, which went public in late September, also said its active customer base increased to over 1 million during the quarter.
The company sells vitamins and dietary supplements, as well as cosmetics, organic body and personal care products, sports nutrition and health foods through its website, www.vitacost.com, as well as through its catalogs.
Customers can easily browse and purchase products at prices, about 30% to 60% lower than manufacturers' suggested retail prices, the company claims. For fiscal 2008, the company posted net sales of $143.6 million, representing a compounded annual growth rate of 48.4% over the past five years.
Net loss for the third quarter widened to $3.8 million or 17 cents per share from year-ago $0.14 million or a penny a share. Excluding a one-time non-cash compensation of $10.9 million related to the company's Initial Public Offering or IPO, proforma earnings for the quarter were $3.1 million or $0.13 per share.
Net sales increased 32% to $48.4 million from $36.7 million last year and gross margin to 31.2% from 24%. Pro- forma operating margins improved to 8.7% from 0.0% in the prior year period.
Looking ahead, the company sees fourth-quarter earnings of $0.07 to $0.08 per share, on revenues of of $48 million to 49 million. For the full year, the company sees pro forma earnings of $0.50 to $0.51 per share on revenues of $189.5 to $190.5 million.
Vitacost.com believes it is well-positioned to take advantage of projected growth in the online commerce and vitamin and dietary supplement markets. U.S. online retail sales totaled about $141 billion in 2008, according to Forrester Research, and expected to increase by 11% to $156 billion in 2009 and to $229 billion by 2013.
Sales of dietary supplements through the Internet grew 24.8% in 2007, according to the Nutrition Business Journal's 2008 Supplement Business Report, and this growth is expected to continue over the next several years at double-digit levels, driven primarily by the increased availability of healthcare and nutrition information online.
The company says the industry will continue to be driven by increasing acceptance of dietary supplements, amid the shift to healthy living, while another key driver is an aging U.S. population.
The stock is down 12.4% since its debut closing price of $12.05 on September 24, closing Tuesday's trade at $10.56.
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