Natural Alternatives International, Inc. Announces Third Quart...(good manufacturing practices (GMPs). ...),Health

For the fiscal 2008 third quarter we reported a net loss of $446,000, or $0.06 per share, on 7.0 million weighted-average shares outstanding. For the third quarter of fiscal 2007 we reported net income of $369,000, or $0.05 per diluted share, on 7.2 million weighted-average shares outstanding.

Cash flows from operating activities for the nine months ended March 31, 2008 were $1.7 million. As of March 31, 2008, NAI had cash and working capital of $3.8 million and $16.6 million, respectively, compared to $4.9 million and $16.2 million, respectively, as of June 30, 2007. As of March 31, 2008, we had $7.5 million available under our working capital line of credit.

President Randell Weaver stated, "Our third quarter results were negatively affected by the continued softness in business from one of our largest contract manufacturing clients and the slower than expected increase in sales volumes from our new customers. During the third quarter we also continued to experience decreased revenues from our branded products business compared to the year ago quarter primarily due to lower sales of the Dr. Cherry Pathway to Healing(R) product line. These decreases along with the increased testing, documentation and validation expenses associated with new product introductions and our ongoing GMP programs negatively impacted our operating income. As we enter the fourth quarter, we anticipate our contract manufacturing sales volume will improve as we expect to deliver initial shipments to one of our new customers and sales to one of our largest customers to trend towards historical sales levels experienced in the comparable prior year period."

Chairman and Chief Executive Officer Mark LeDoux added, "Although the cost of compliance is significant, we believe our unwavering commitment to quality and our steadfast support of the FDA published GMPs makes us well positioned to meet the higher standards of the new law." '/>"/>