PITTSBURGH, June 20, 2019 – Holdings, Inc. () recently stated consolidated revenue of $564.80M in the first quarter of 2019, contrast with consolidated revenue of $607.50M in the first quarter of 2018.  The decrease in revenue was mainly a result of the transfer of the Nutra manufacturing and China e-commerce businesses to the newly formed joint ventures and the closure of company-owned stores from our store portfolio optimization strategy.

For the first quarter of 2019, the Company stated a net loss of $15.30M contrast with net income of $6.20M in the prior year quarter. Diluted loss per share was $0.23 in the current quarter contrast with diluted earnings per share (“EPS”) of $0.07 in the prior year quarter. In the first quarter of 2019, the Company recorded a $16.80M loss on forward contracts related to the issuance of convertible preferred stock as a result of the Harbin investment and a $19.50M loss on the exchange of net assets for the newly formed joint ventures.  In the prior year quarter the Company recorded a $16.70M loss on debt refinancing.  Excluding these items and other expenses, adjusted net income was $19.00M in the current quarter, contrast with adjusted net income of $20.10M in the prior year quarter.  Adjusted EPS was $0.15 in the current quarter contrast with $0.24 in the prior year quarter.

Adjusted EBITDA was $65.90M, or 11.7% of revenue in the current quarter contrast with $59.30M, or 9.8% of revenue in the prior year quarter.

Cash Flow and Liquidity Metrics:

For the three months ended March 31, 2019, the Company generated net cash from operating activities of $68.70M contrast with $25.10M for the three months ended March 31, 2018. The increase was driven by favorable working capital changes mainly because of a boost in accounts payable as a result of the Company’s cash management efforts and a boost in accounts payable related to the establishment of the manufacturing joint venture.

For the three months ended March 31, 2019, the Company generated $154.30M in free cash flow which includes $101.0M proceeds from the Nutra manufacturing transaction, contrast with $37.40M for the three months ended March 31, 2018. The Company defines free cash flow as cash offered by operating activities (excluding fees regarding the debt refinancing) less cash used in investing activities. At March 31, 2019, the Company’s cash and cash equivalents were $137.10M and debt was $888.40M. No borrowings were outstanding on the Revolving Credit Facility at the end of the first quarter of 2019.

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