FitLife Brands, Inc. (FTLF) Q4 2024 Earnings Call Transcript

Access earnings results, analyst expectations, report, slides, earnings call, and transcript.

Overview

The earnings call summary shows strong financial performance with increased gross margin and contribution, and significant revenue growth. Despite a decline in online revenue, wholesale revenue surged, and adjusted EBITDA rose 39% YoY. The Q&A highlighted optimism in rebranding and new products, though management was vague on some details. The lack of new partnerships or guidance changes, and no severe risks identified, points to a positive sentiment. However, uncertainties in promotional expenses and GNC relations slightly temper the outlook, resulting in a positive stock price prediction.

Key Financial Performance

Total Revenue (Q4 2024) $15 million, up 13% year-over-year.

Total Revenue (Full Year 2024) $64.5 million, up 22% year-over-year.

Online Sales (Q4 2024) $10.1 million, up 12% year-over-year, representing 67% of total revenue.

Gross Profit (Q4 2024) $6.2 million, up 16% year-over-year.

Gross Margin (Q4 2024) Expanded from 40.3% to 41.4%.

Contribution (Q4 2024) $5.2 million, up 18% year-over-year.

Net Income (Q4 2024) $2.1 million, up 40% year-over-year.

Basic EPS (Q4 2024) $0.23, up 44% year-over-year.

Fully Diluted EPS (Q4 2024) $0.21, up 40% year-over-year.

Adjusted EBITDA (Q4 2024) $3.1 million, up 31% year-over-year.

Total Revenue (Legacy FitLife Q4 2024) $5.3 million, down 13% year-over-year due to a commercial dispute with GNC.

Gross Margin (Legacy FitLife Q4 2024) Declined from 40.4% to 39.7%.

Total Revenue (MRC Q4 2024) $6.9 million, down 0.4% year-over-year.

Gross Margin (MRC Q4 2024) Increased from 40.4% to 48.7%.

Contribution (MRC Q4 2024) Increased from 28.2% to 37.1%.

Total Revenue (MusclePharm Q4 2024) Increased 14% sequentially from Q3 2024.

Wholesale Revenue (MusclePharm Q4 2024) Increased by 37%.

Online Revenue (MusclePharm Q4 2024) Declined by 8% sequentially.

Net Debt (End of Q4 2024) $8.6 million, equivalent to 0.6x LTM adjusted EBITDA.

Outstanding Indebtedness (Post Q4 2024) $12 million after additional amortization payment.

Cash Balance (End of Q4 2024) $4.5 million.

Adjusted EBITDA (Full Year 2024) $14.1 million, up 39% year-over-year.

You have reached the limit Upgrade to access full content

Get started

Operating Highlights

New Product Launches: Launched the new MusclePharm Pro Series, a collection of nine SKUs of premium sports nutrition products in a two-month pilot in Vitamin Shoppe stores.

New Flavors: Introduced two new flavors of MusclePharm protein bars and three flavors of a new ready-to-drink protein with 40 grams of protein and no added sugar.

Rebranding Efforts: Transitioning to new packaging for Legacy MusclePharm products, with shipments beginning in late 2024.

Market Expansion: The MusclePharm Pro Series is anticipated to gain permanent shelf space system-wide within Vitamin Shoppe if the pilot is successful.

Operational Efficiency: Achieved a gross profit increase of 31% and gross margin expansion from 40.7% to 43.6% for the full year 2024.

Debt Management: Reduced outstanding indebtedness to $12 million, improving the net debt to adjusted EBITDA ratio.

Strategic Shift: Prioritizing larger acquisitions while remaining open to smaller ones, with a focus on evaluating M&A opportunities.

You have reached the limit Upgrade to access full content

Get started

Risk or Challenges

Commercial Dispute with GNC: A significant challenge arose from a commercial dispute with GNC, FitLife's largest customer, which began in December 2024. This dispute led to the rejection of purchase orders (POs) from GNC, resulting in depleted inventory and affecting fourth quarter sales.

Skin Care Brands Performance: The skin care brands acquired in the Mimi's Rock transaction faced challenges, including a significant amount of unprofitable revenue. This necessitated a rationalization process that impacted overall revenue performance.

Tariffs Uncertainty: There is ongoing uncertainty regarding tariffs, which could pose risks to the company's cost structure and pricing strategies.

Wholesale Revenue Decline: Legacy FitLife experienced a 20% year-over-year decline in wholesale revenue, indicating potential challenges in maintaining relationships with wholesale customers.

Economic Factors: The company anticipates a 4% to 6% revenue decline for the first quarter of 2025 compared to the previous year, influenced by economic factors and year-over-year comparisons.

Promotional Investments Impact: Increased promotional investments for MusclePharm may lower reported net revenue and gross profit, affecting overall financial performance.

You have reached the limit Upgrade to access full content

Get started

Guidance & Outlook

Revenue Growth: Total revenue increased 22% year-over-year to $64.5 million for the full year 2024.

Online Sales Growth: Online sales grew 29% year-over-year, representing 67% of total revenue.

Gross Margin Expansion: Gross margin expanded from 40.7% to 43.6%.

MusclePharm Pro Series Launch: Launched new MusclePharm Pro Series in a pilot at Vitamin Shoppe, with potential for permanent shelf space.

M&A Strategy: Actively evaluating acquisition targets, prioritizing larger transactions as balance sheet strengthens.

Q1 2025 Revenue Outlook: Expect consolidated revenue for Q1 2025 to be 4% to 6% lower than Q1 2024.

Adjusted EBITDA Outlook: Expect adjusted EBITDA for Q1 2025 to be roughly flat despite anticipated revenue decline.

MRC Revenue Decline: Expect MRC online revenue to decline between 10% and 13% for Q1 2025.

MusclePharm Revenue Expectations: Expect MusclePharm wholesale revenue to decline somewhat in Q1 2025, offset by strong online sales.

You have reached the limit Upgrade to access full content

Get started

Shareholder Return Plan

Share Repurchase Program: The company has not mentioned any share repurchase program during the call.

Dividend Program: The company has not mentioned any dividend program during the call.

You have reached the limit Upgrade to access full content

Get started

Key Q&A

Q:How many products right now are you guys sourcing from China? And what would be kind of the hurdle that you guys would have to get over to be able to source some of these products here domestically?

A:We don't actually source anything from China. All of our products come from manufacturers in the U.S. However, we need to drill down to the formula level to see where our manufacturers are getting their ingredients, as China is a big source for nutritional supplement companies. We are exploring sourcing from other countries, particularly India.

Q:Is it just a function of you saw so many customers last year at this time purchasing products at the beginning of the year and you're not maybe seeing as many return customers?

A:Our hypothesis is that Amazon's new functionality allowed deeper discounts for new customers, which drove significant uptake last year. We saw a spike in subscribers after implementing this change, but it's hard to tell if there's general consumer softness.

Q:Can you provide some more color around your expectations for the MusclePharm ramp throughout the year?

A:I can't frame it with numbers, but we feel like we're doing the right things with rebranding and new products. It's too early to tell the uptake, but we are optimistic.

Q:Can you explain the promotional expenses running through gross profit? Is that a one-time thing when entering new accounts?

A:Promotional dollars are discounts off the invoice to encourage movement. It's typical in the industry, and while we expect growth from these promotions, if they don't work, we will reconsider future promotions.

Q:What is the typical size in terms of revenue that you're looking for in M&A targets?

A:It's not just about revenue; it depends on profitability and our ability to pay. We can borrow based on pro forma EBITDA.

Q:Are you seeing stress in the market?

A:We are seeing an uptick in deal flow, but it's not necessarily due to supply chain issues; it's more about companies being over-levered.

Q:What were MusclePharm's sales at their peak, and do you think you can surpass that?

A:MusclePharm's peak revenue was over $175 million, but we are focused on rebuilding the brand and would consider it a success to reach half of that.

Q:Is there any prospect of increasing your gross margins?

A:We could increase margins by stopping promotions, but we are currently focused on growth.

Q:How is your online advertisement performing, specifically on Amazon?

A:We have reduced ad spend significantly since acquiring the brand, and we are now at a stable level without dramatic cuts or increases.

Q:Do you have appreciable international sales now after all your acquisitions?

A:95% of our revenue is domestic, with most international sales being in Canada.

Q:What is the nature of your relationship with GNC?

A:GNC is our biggest customer, and while we value the relationship, we are not willing to be bullied. We have the ability to sell directly to franchisees if needed.

Q:Did the GNC issue affect revenue and gross margin?

A:It affected revenue, but not gross margin significantly. We continued to ship products until late December.

Q:Is there a difference in profitability of sales to franchisees versus the corporation?

A:Yes, we charge a higher price to franchisees, but I can't definitively say if we make more money selling direct.

Q:Should we expect gross margins in MusclePharm to stay at mid-20s levels?

A:For now, we are investing in growth, so margins may remain at this level.

Q:Are there any unusual items in operating expenses?

A:Nothing comes to mind; I can't think of anything unusual.

Q:What are your expectations of the current administration's impact on supplements?

A:The current administration may shake things up, but we have been proactive in moving away from artificial colors.

Q:Review of Unclear Management Responses

A:Management avoided giving a direct answer regarding specific revenue numbers for MusclePharm's ramp expectations and the impact of promotional expenses on gross margins. Additionally, there was a lack of clarity on the exact nature of the relationship with GNC and the potential for future changes.

You have reached the limit Upgrade to access full content

Get started

Earnings Word Cloud

The most frequently occurring keywords in this quarter's earning call

FTLF Transcript

FitLife Brands, Inc. (FTLF) Q3 2025 Earnings Call Transcript

Unknown11-13

The earnings call reveals several negative factors: declining margins, increased tax expenses, and unresolved issues with Dr. Tobias on Amazon. Although MusclePharm shows growth, it's primarily from existing customers. Rising protein costs and potential further margin declines are concerning. Despite optimistic guidance for Irwin's online sales, the lack of clarity on subscriber trends and management's avoidance of detailed responses contribute to a negative sentiment. Without a market cap, the negative impact is assumed to be moderate.

FitLife Brands, Inc. (FTLF) Q2 2025 Earnings Call Transcript

Unknown8-14

The earnings call summary presents a mixed picture. Positive aspects include potential revenue synergies from the FitLife-Irwin merger and the likelihood of inclusion in the Russell 2000 Index. However, the lack of forward-looking guidance and challenges with Dr. Tobias brand balance these positives. The Q&A section reinforces this neutral stance with uncertainties regarding Irwin's revenue growth and the integration process. Overall, the absence of clear guidance and the focus on addressing brand challenges suggest a cautious market reaction, resulting in a neutral stock price prediction.

FitLife Brands, Inc. (FTLF) Q1 2025 Earnings Call Transcript

Unknown5-15

The earnings call highlights several negative aspects: declining revenue and gross profit, reduced margins, significant M&A expenses, and wholesale revenue decline. The Q&A session lacked clarity on MusclePharm's performance and margins, adding uncertainty. Despite some positive aspects like online sales growth and product launches, the weak guidance, declining margins, and absence of a share buyback program suggest a negative market reaction.

FitLife Brands, Inc. (FTLF) Q4 2024 Earnings Call Transcript

Positive3-27

FTLF Report

FITLIFE BRANDS, INC. 10-Q

10-Q

2025-08-14

FITLIFE BRANDS, INC. 10-Q

10-Q

2024-11-14

FITLIFE BRANDS, INC. 10-Q

10-Q

2024-08-14

FITLIFE BRANDS, INC. 10-Q

10-Q

2024-05-14

Frequently Asked Questions

Where does this earnings call transcript come from?

All transcripts are sourced directly from the official live webcast or the company’s official investor relations website. We use the exact words spoken during the call with no paraphrasing of the core discussion.

How soon is the transcript available after the earnings call ends?

Full verbatim transcripts are typically published within 4–12 hours after the call ends. Same-day availability is guaranteed for all S&P 500 and most mid-cap companies.

Is the transcript edited or altered in any way?

No material content is ever changed or summarized in the “Full Transcript” section. We only correct obvious spoken typos (e.g., “um”, “ah”, repeated 10 times”, or clear misspoken ticker symbols) and add speaker names/titles for readability. Every substantive sentence remains 100% as spoken.

Why do some answers appear as “Unclear” or “Inaudible”?

When audio quality is poor or multiple speakers talk over each other, we mark the section instead of guessing. This ensures complete accuracy rather than introducing potential errors.

Who creates the AI Summary and Key Q&A highlights shown above the transcript?

They are generated by a specialized financial-language model trained exclusively on 15+ years of earnings transcripts. The model extracts financial figures, guidance, and tone with 97%+ accuracy and is regularly validated against human analysts. The full raw transcript always remains available for verification.