0001437749-26-004118
SEC filingNatural Alternatives International, Inc. (NAII) reported a challenging second quarter of fiscal 2026, with net sales totaling $34.8 million. The company experienced a gross profit of $2.5 million; however, selling, general, and administrative expenses of $4.3 million resulted in an operating loss of $1.8 million. After accounting for $482,000 in other expenses, primarily driven by interest and foreign exchange losses, the net loss widened to $2.6 million for the quarter. The balance sheet reflects a solid equity position of $67.0 million against total assets of $153.3 million, though liquidity tightened with cash and cash equivalents decreasing to $3.8 million. Operating cash flow usage was significant at $10.4 million, partly offset by financing activities. Without prior period comparative figures in the provided data, sequential or year-over-year performance trends cannot be quantified, but the current period indicates margin pressure and negative profitability.
Natural Alternatives International, Inc. reported net sales of $34.8 million for the second quarter of fiscal 2026 ending December 31, 2025. The company faced profitability challenges, recording a gross profit of $2.5 million and an operating loss of $1.8 million. After accounting for other expenses totaling $482,000, which included $224,000 in interest expense and $194,000 in foreign exchange losses, the net loss attributable to shareholders was $2.6 million. Comprehensive loss was slightly lower at $2.2 million due to a $400,000 unrealized gain on derivative instruments. The basic and diluted net loss per share was reported as -$0.00, based on 6.0 million weighted average shares outstanding.
The filing discloses total net sales of $34.8 million with a cost of goods sold of $32.3 million. The provided XBRL data and document text do not contain a breakdown of revenue by segment, geography, or product line. Consequently, specific growth drivers or revenue mix details cannot be analyzed from the available information. The absence of segment data limits the ability to assess which business units contributed to the top-line figures.
Gross margin for the quarter stood at approximately 7.2%, calculated from $2.5 million gross profit on $34.8 million sales. Operating margin was negative at -5.2%, driven by selling, general, and administrative expenses of $4.3 million which exceeded gross profit. The cost structure indicates that SG&A expenses represented 12.4% of revenue, significantly impacting the bottom line. The effective tax rate was notable, with a $224,000 tax provision recorded despite the pre-tax loss of $2.3 million.
The company's liquidity position tightened, with cash and cash equivalents falling to $3.8 million from $12.3 million at the beginning of the period, representing a net decrease of $8.6 million. Operating activities used $10.4 million in cash, heavily influenced by a $2.6 million net loss and significant working capital changes, including an $8.6 million reduction in inventories. Free cash flow was negative $12.4 million (operating cash flow of -$10.4M minus $2.0M in capital expenditures). Financing activities provided $3.7 million, primarily from $3.9 million borrowed on the line of credit. Total debt obligations included a $5.8 million line of credit and $8.8 million in mortgage notes payable.
The provided document text and XBRL data do not contain specific forward-looking statements, management guidance, or strategic priorities regarding future operations. No risk factors or outlook commentary were included in the extracted sections. Therefore, an assessment of management's future expectations cannot be provided based solely on the available input data.