Smart Balance Announces 2008 First-Quart...(s $507...),Health

COGS 27,938 20,672

Gross Profit 22,828 19,911

Gross margins 45.0% 49.1%

Marketing 7,225 6,901

Selling 5,057 3,450

G&A 8,584 1,403

Total SG&A 20,866 11,754

Operating Income 1,962 8,157

% of Net Sales 3.9% 20.1%

Operating Income includes the following

non-cash items

FAS 123R Stock Options 3,534 --

Depreciation 53 6

Amortization 1,022 --

4,609 6

Operating Income net of non-cash items: 6,571 8,163

% of Net Sales 12.9% 20.1%

(1) The Company's GAAP financial statements include the results of its

acquisition of GFA Brands, Inc. since the date of acquisition on

May 21, 2007. Because there were no operations prior to the

acquisition, prior periods are not comparable. The operating basis

results should not be viewed in isolation or as a substitute for

reported GAAP results. Please refer to the reconciliation of operating

basis results to GAAP results provided for in the accompanying table.

Smart Balance, Inc.

Reconciliation of Operating Basis to GAAP Basis

Prior to Smart Balance, Inc.'s May 21, 2007 acquisi
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