Natural Alternatives International, Inc. · NASDAQ:NAII
Natural Alternatives International — Investor Presentation (November 2022)
30 slides from Natural Alternatives International's investor presentation, November 2022
Slide 1: Natural Alternatives International, Inc. Investor Presentation
Custom Contract Manufacturing Since 1980. Enriching the World Through the Best of Nutrition. Natural Alternatives International, Inc. Investor Presentation November 2022 Nasdaq: NAII
Slide 2: Forward Looking Statements
Forward Looking Statements This presentation contains forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934. These statements reflect Natural Alternatives International, Inc.’s (the Company’s) current views about future events and financial performance b
Slide 3: Regulation G
Regulation G In addition, in order to assist you with period-over-period comparisons on a consistent and comparable basis, our presentation includes certain non-US GAAP information. This information excludes certain non-cash expenses, certain cash income and expense items related to our foreign curr
Slide 4: Company Snapshot
Company Snapshot NAII is the only pure-play public company that offers global formulation and manufacturing of customized nutritional supplements along with marketing branded and patented products Contract Manufacturing We provide private-label contract manufacturing services to companies that marke
Slide 5: Company Strengths
Company Strengths Multi-Continent Contract Manufacturing Facilities • Custom product formulation • State-of-the-art manufacturing facilities • Broad material acquisition & analysis • Certified in-house laboratory capabilities • Multiple packaging configuration capabilities In-House Brand Leveraging
Slide 6: Company Strengths
Company Strengths Growth Drivers From Organic Initiatives And Complementary Acquisitions • Expand existing customer products, base and channels • Expand in-house brands • Complementary acquisitions Solid Cash Flows And Strong Balance Sheet To Support Growth Objectives • TTM* net sales of $175.8 mill
Slide 7: Executive Management Team
Executive Management Team Mark A. LeDoux CEO and Chairman of the Board of Directors Mr. LeDoux founded Natural Alternatives International (NAI) in 1980. With over 45 years of experience since joining the nutritional supplements industry in 1975, Mr. LeDoux is considered a highly regarded leader and
Slide 8: Executive Management Team
Executive Management Team Kenneth E. Wolf President and Chief Operating Officer Mr. Wolf joined NAI in February 2008 as Chief Financial Officer, was promoted to Chief Operating Officer in June 2010 and has served as NAI’s President since October 2015. Mr. Wolf is responsible for design and implement
Slide 9: Overview – Capabilities
Overview – Capabilities Global Production • Up to 17 million capsules and 11 million tablets daily capacity • Up to 500,000 bottles finished product daily capacity • Highly sophisticated in-house laboratories Packaging • Warehousing – 7,500+ pallet capacity • HDPE/PP Bottles Regulatory • Full Label
Slide 10: Overview – Contract Manufacturing
Overview – Contract Manufacturing Product Formulation • Custom formulations • In-house science teams • Clinical study design and support • In-house product stability testing capabilities Material Acquisition and Analysis • Global raw material sourcing expertise • Transparency and tracking of materia
Slide 11: Overview – Patent & Trademark Licensing
Overview – Patent & Trademark Licensing In-house brand expansion leveraging our Sports Nutrition proprietary ingredients: CarnoSyn® and SR • Enhance athletic performance CarnoSyn® beta-alanine. • Build muscle and reach peak sustainable performance • New sustained release form of CarnoSyn® remains in
Slide 12: Worldwide Operations and Market Reach
Worldwide Operations and Market Reach NAI’s global footprint and scope facilitates greater opportunities and more dynamic client engagement Manno, Switzerland Carlsbad, CA Vista, CA NAI Offices and Operating Centers Primary Markets 12
Slide 13: NAI US Facilities Tour
NAI US Facilities Tour lternatives nal, Inc. Natural Alternatives “ International, Inc. 13
Slide 14: Accreditations
Accreditations Industry leading accreditations and certification demonstrate our commitment to quality and are a strong barrier to entry Domestic (NAI) International (NAIE) Good Manufacturing Practices (cGMPs) (21 CFR 111) compliant – SwissMedic GMP certified – site registered and licensed FDA Inspe
Slide 15: Industry Trends
Industry Trends We will benefit from growing consumer interest in health and wellness 87% 66% 80% 87% - of consumers 66% - of consumers say 80% - of consumers who typically use some type supplements are an say supplements are an of vitamin, mineral, or important part of their important part of their
Slide 16: US Supplement Market Forecast
US Supplement Market Forecast A new level of demand has been established with an estimated CAGR of 5.2%; Supplement industry on track to pass $59B in 2022 and grow to $80B+ by 2028 US Dietary Supplements Market Revenue Forecast for 2022 Vitamins Minerals 28% 32% Proteins and Amino Acids Probiotics 6
Slide 17: Global Supplement Market Forecast
Global Supplement Market Forecast Global trend is matching US trend Global market growth expected at a CAGR of 5.9% growth to $319B in revenue by 2028. SOURCE: TheInsightsPartners – Dietary Supplements Market analysis ($MIL) 17
Slide 18: Financial Performance and Growth Objectives
Financial Performance and Growth Objectives 18
Slide 19: Historical Revenue and EBITDA
Historical Revenue and EBITDA Sales in FY21 increased primarily due to higher sales from a majority of our distribution channels worldwide, including higher sales of immune and wellness products that appears to be driven by consumers taking a more active role in their health and wellness as a result
Slide 20: Historical Sales By Channel
Historical Sales By Channel $200 Millions $180 8% 7% $160 5% 9% $140 28% 23% 12% $120 16% 10% 11% 22% 10% 8% $100 10% $80 87% $60 68% 65% 78% 74% 81% $40 68% $20 $- FY17 FY18 FY19 FY20 FY21 FY22 Trailing 12 Months** Direct Sales Retail Patent & Trademark Licensing **Trailing 12 Months (TTM) – Includ
Slide 21: Objectives & Growth Drivers
Objectives & Growth Drivers • Fiscal 2023 and Beyond Targeted Growth Objectives: Achieve $210 million to $250 million revenue run-rate in the next 3 years with double digit Adjusted EBITDA margins Target sales growth rate of 5-10% per year Pursue complimentary accretive acquisitions generating
Slide 22: Acquisition Strategy
Acquisition Strategy Channels Verticals Health Care Practitioner Wellness Brands Multi-Level Marketer High Value Ingredient Suppliers Direct-to-Consumer Contract Manufacturers Specialty Retail Value-Add Distributors Drug Store Mass Markets Forms Vitamins, Minerals, Supplements Capsules/Tablets, Powd
Slide 23: Investment Thesis
Investment Thesis • As of November 4, 2022, global capacity utilization of ~60% • New high-capacity blender came online January 2022 in our Vista, CA facility increasing our overall product blending capacity in the USA by approximately 30% • Acquisition of new Manufacturing and Warehouse Facility in
Slide 24: Investor Information
Investor Information Stock Symbol: NASDAQ: NAII Company website: http://www.nai-online.com Company Headquarters: 1535 Faraday Avenue Carlsbad, CA 92008 Investor Relations Contacts Michael Fortin Chief Financial Officer 760-736-7700 investor@nai-online.com 24
Slide 25: Appendix
Appendix Investor Relations Info 25
Slide 26: Historical Segment Performance
Historical Segment Performance Trailing 12 Fiscal Year ended June 30, Months* 2020 2021 2022 (Unaudited) Revenue Private Label Contract Manufacturing $ 106,291 $ 164,310 $ 154,798 $ 162,979 Patent & Trademark Licensing 12,585 14,210 16,168 12,774 Total Revenue $ 118,876 $ 178,520 $ 170,966 $ 175,753
Slide 27: Condensed Consolidated Statements of Income
Condensed Consolidated Statements of Income (In thousands, except per share data) (Unaudited) Three Months Ended September 30, 2022 2021 NET SALES $ 43,127 100.0% 38,340 100.0% Cost of goods sold 37,756 87.5% 30,059 78.4% Gross profit 5,371 12.5% 8,281 21.6% Selling, general & administrative expense
Slide 28: Condensed Consolidated Balance Sheets
Condensed Consolidated Balance Sheets NATURAL ALTERNATIVES INTERNATIONAL, INC. CONDENSED CONSOLIDATED BALANCE SHEETS (In thousands) (unaudited) September 30, June 30, 2022 2022 ASSETS Cash and cash equivalents $12,341 $21,833 Accounts receivable, net 14,822 17,422 Inventories, net 39,990 32,475 Othe
Slide 29: Adjusted EBITDA Reconciliation (Non-US GAAP)
Adjusted EBITDA Reconciliation (Non-US GAAP) Natural Alternatives International, Inc. Adjusted EBITDA – Non – US GAAP Reconciliation (In Thousands) Trailing 12 (Unaudited) FY17 FY18 FY19 FY20 FY21 FY22 Months* Net Income (Loss) $7,235 $5,051 $6,541 ($1,645) $10,768 $10,712 $8,509 Interest Income (45
Slide 30: Thank You
Custom Contract Manufacturing Since 1980. Enriching the World Through the Best of Nutrition. Thank You www.nai-online.com Nasdaq: NAII
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