Financial Reports: NEBS, NBTY

NEBS Up on Safeguard Results

Higher sales and profits in four of its five segments drove the performance of Groton, MA-based New England Business Service (NYSE: NEB). The multititle mailer sells business forms, workwear, packaging and warehouse supplies, and products for small and home offices.

Revenue for the quarter ended Dec. 27 totaled $197 million, compared with $153 million for the comparable quarter of 2002. The 29% increase in sales was driven by the addition of Safeguard Business Systems, which NEBS acquired last June. Excluding the Safeguard acquisition, net sales grew about 3%.

Net income decreased 25%, to $9.7 million from $12.9 million the previous year. But excluding the effect of the unusual items, net income was $10.7 million, up 3% from $10.5 million the previous year.

Sales in U.S. direct marketing fell to $78.9 million from $80.9 million a year earlier. Profits from U.S. direct marketing fell slightly as well, to $18.2 million from $19.0 million.

“While sales of holiday cards rose 8% year to year, marketing spending was geared to a greater increase, which adversely impacted profits in the Direct Marketing–U.S. segment,” president/CEO Richard T. Riley said in a statement.

NEBS expect sales for fiscal 2004 to reach $700 million-$725 million, an increase of 25%-30%, primarily as a result of the Safeguard acquisition and this month’s acquisition of Stephen Fossler Co.

NBTY Sales Up 60%
For the quarter ended Dec. 31, Bohemia, NY-based nutritional supplements manufacturer/marketer NBTY (NYSE: NTY) reported sales of $385 million, up 60% from the comparable quarter of 2002. Net income for the fiscal first quarter rose 42%, to $24 million from $17 million the previous year. The increases are due in part to the acquisition of Rexall in July. With the $75 million in Rexall sales, revenue would have increased 29%.

Sales from the Puritan’s Pride catalog/e-commerce division increased 3%, to $35 million from $34 million last year. Puritan’s Pride Web sales rose 51% and accounted 20% of Puritan’s Pride sales for the quarter.

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