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About the NBJ Business Achievement Awards
NBJ solicited the industry via email, website and word of mouth for nominations
for the NBJ awards. Awards were determined by an internal committee of NBJ staff
and NBJ editorial advisory board members. The 2005 NBJ awards will be presented
in a special ceremony at the NBJ Newport Summit in Dana Point, Calif., July
26-28, 2006. Awards disclaimer: Company audits were not conducted to
verify information or claims submitted with nominations.
Growth in Large Companies
Gold Medal: Direct selling company XanGo
for 145% growth in its third year in business, more than doubling 2004 sales
and putting the multimillion-dollar company on track to achieve its goal of
$1 billion in annual sales by 2009. XanGo has expanded its employees from 14
to nearly 600, its distributor network to hundreds of thousands and its international
markets to 13. XanGo markets the nutritional beverage XanGo Juice, which
is made from the mangosteen fruit and has surpassed annual sales volumes of
such brand icons as Frosted Flakes, Wheat Thins, Converse Shoes and Windex,
according to the company.
Silver Medal: GFA Brands for more than doubling sales to $130
million in 2005. GFA’s leading brand is Smart
Balance, a portfolio of non-transfat products including spreads, popcorn,
peanut butter and pasta sauces sold mostly through mass market grocery. Earth
Balance is a similar line sold primarily in the natural & specialty
channel. Expansion was supported by a 2004 investment from TSG Partners.
Bronze Medal: Direct seller Mannatech
Inc. for growth of 37% in 2005, posting net sales of $288 million for
the nine months of 2005 through September 30, a run rate of about $380 million
in annual sales. The increase resulted mostly from adding independent associates
and members, but also from the launch of Advanced Ambrotose, an immune
support supplement, and international expansion including opening operations
in Taiwan and notable growth in Denmark.
Bronze Medal: Now
Foods, a manufacturer of supplements, health food and natural personal
care, for consistently growing at rates more than twice the industry average.
In 2005 NOW’s gross domestic revenue exceeded $100 million on double-digit
gains for the last five consecutive quarters, and averaged 8.5% growth for the
past 11 quarters. Cost management tactics played an important role in returning
above-average profits, including direct fulfillment, electronic ordering, limited
use of field reps and direct sourcing of materials, the company reported.
Growth in Mid-Size Companies
Gold Medal: Knight-McDowell
Labs, maker of Airborne, for one of the fastest selling health products
in retail history and proving that a start-up can compete sucessfully against
big OTC manufacturers in the cold and cough aisle. Developed by Victoria Knight-McDowell,
an elementary school teacher who was tired of catching colds in class and on
airplanes, Airborne is an effervescent tablet that combines seven herbs
with amino acids, antioxidants and electrolytes. Knight-McDowell sold the first
package of Airborne in January 1997. Airborne wholesale sales
in 2005 were estimated at $65 million, up from less than $10 million in 2003.
Knight-McDowell Labs also received a private investment in 2005. (See Deals,
p.5.)
Silver Medal: Higher Power Inc. for an exceptional record of growth
and profitability leading to projected annual sales of $48 million and EBITDA
of 10% in 2005, up from sales of $32.5 million in 2004. This robust performance
followed on the heels of annual sales of $5.4 million, $10.5 million and $17
million in 2001-03. Gross margins rose to 25% in 2004 from 17% in 2001. Higher
Power ranked #230 on the INC. 500 and as the fastest growing private
company in Idaho. Higher Power owns Bodybuilding.com,
an e-commerce site selling supplements and fitness products, and Athletes.com,
which targets athletes, coaches and other sports professionals.
Bronze Medal: Standard
Process Inc., a manufacturer of whole food supplements for health care
professionals, for record sales of $65 million, up 17% in 2005. The largest
sales increase was in body purification products, which grew 26% compared to
2004. This year, Standard Process also focused on ‘mid-selling’ products
like Spanish Black Radish and Multizyme, reflected in rises of
29% and 45%, respectively. Standard Process Veterinary Formulas (up 25%)
and MediHerb (up 19%) also showed exceptional growth. The company attributed
its robust performance to product quality, the health care professionals it
serves and growing awareness of nutritional supplementation. The family owned
company is now in its 76th year.
Honorable Mention: Europa
Sports Products for more than tripling sales since 2000 as a national
distributor of sports supplements, beverages and weightlifting accessories.
Europa had revenues of over $100 million for 2005, up 14% for the year, and
up from $30 million in 2000. Europa opened its fourth location in Strongsville,
OH in early 2005, joining locations in Charlotte, NC; Mesquite, TX; and Fresno,
CA to supply gyms, health food stores, Internet sites and specialty supplement
retailers. Europa started in 1990 and today, it is a distributor of over 150
product lines with over 3,400 sku’s and employs 187 people with a sales
staff of experienced competitive bodybuilders, fitness enthusiasts, athletes
and certified trainers.
Growth in Small Companies
Gold Medal: Canadian supplement company CV
Technologies Inc. for 400% growth in net sales to $32 million in fiscal
2005 and $10 million in net after-tax profit after barely posting a profit in
2004. The significant sales increase was generated primarily by CVT’s lead
product, COLD-fX, which contains a proprietary extract of poly-furanosyl-pyranosyl-saccharides
isolated from North American ginseng. COLD-fX’s patented mechanism
of action was developed and standardized using the company’s ChemBioPrint
technology.
Silver Medal: Enfission Inc. for the market success of Zipfizz,
a effervescent powdered vitamin energy formula emphasizing its B-12 content.
Since its launch in 2004 sales have gone from under $5 million in 2004 to around
$15 million in 2005 with a realistic target of $30 million in 2006. Zipfizz
is sold predominantly through club and convenience channels but is spreading
into other mass market sales venues.
Silver Medal: BioNutritional
Research Group Inc. (BNRG) for growing revenues by 350+% to more than
$7.5 million in 2005. Kevin Lawrence, founder and CEO of BNRG, credited the
increase to an extensive sampling program for Power Crunch, the company’s
flagship brand of creme-filled, high-protein wafer cookies made using BNRG’s
proprietary Micro-Peptide whey hydrolysate Proto Whey protein,
which has 300% better absorption compared to other proteins, according to the
company. Power Crunch cookies grew sales by 388% to $5.8 million exclusively
in the health and fitness channel and are poised for faster growth in FDM channels
in 2006. The cookies are designed to appeal to health-conscious adults and parents
of children and adolescents seeking nutrient dense, high protein snacks that
are a departure from typical, heavy protein nutrition bars. "We went through
several formulations until my kids loved the cookies. It’s just like the
old commercial, ‘Mikey Likes It’. When I got the thumbs up, I knew
we had a winner," said Lawrence.
Bronze Medal: Pure
Fruit Technologies, marketer of Mango*xan, a mangosteen-based
nutritional beverage, for surpassing its year-end goal by the end of the third
quarter 2005 when it generated revenues of $2.3 million, up 550% from $422,000
in January to October 2004. Founded three years ago, Mango*xan was sold
in fewer than 200 stores in 2004 but is carried in several thousand retail outlets
today. To meet demand the company increased production from 6,500 bottles a
month in 2004 to 52,000 bottles a month in 2005. Pure Fruit Technologies also
expanded its staff by 40% this year. Pure Fruit plans to continue its rapid
growth by launching several new products early in 2006.
Bronze Medal: Organic
Hope Corp. for tripling its sales in 2005 and positioning itself as
top manufacturer and distributor of Kalawalla (Polypodium leucotomos extract)
worldwide. Polypodium leucotomos is a fern that grows in the Honduran
jungles and rainforests and survives the rainy season by growing over the top
of palm trees. Ancient Mayans drank tea made from the plant as a blood purifier.
Organic Hope markets its extracts for psoriasis, vitiligo, dermatitis and other
autoimmune disorders. In accordance with the Rio de Janeiro Biodiversity Protocol
it uses only cultivated plants.
Growth in Ingredient Suppliers
Gold Medal: Protient Inc.,
a leading manufacturer and supplier of membrane filtered whey, soy, and milk
proteins, for exceeding $90 million in FY2005 sales, up 38% from 2004. The company
attributed its success to hard work, expanded sales distribution channels and
penetration into untapped international markets, and said it expects the rapid
growth to continue into 2006. Protient expanded its membrane processing technology
enabling it to introduce milk protein concentrates and isolates. It also acquired
three new manufacturing facilities in 2005, leading to improved utilization
of raw materials and lower operating costs.
Silver Medal: Marine
Nutriceutical Corp. for growth and innovation in the dynamic category
of high quality specialty fish oil and for more than doubling sales in the last
two years to $20-30 million. Marine Nutriceutical has special expertise in producing
highly purified omega-3 oils that lend themselves to flavored liquids and flavored
softgels. The company prides itself on being the "micro brewery" of
fish oils, creating custom oils in close collaboration with customers, which
include direct marketers, MLMs and leading specialty brands. Marine Nutriceutical’s
other marine products include shark liver oils, squalene/squalane and GlycoMarine,
an extract of the New Zealand green lipped mussel.
Bronze Medal: Ocean
Nutrition Canada Ltd. for averaging sales growth over the past three
years of 55%, with 84% growth anticipated for 2006. The company has expanded
from four employees eight years ago to more than 300 today. Contributing to
future growth is a new micro-encapsulation facility in Arcadia Wis., and the
addition a micro-encapsulation facility in Dartmouth, Nova Scotia. Since last
year, the MEG-3 brand mark has been placed on packaging such as Costco’s
Kirkland Signature Fish Oil Concentrate, The Vitamin Shoppe Fish Oil
EPA & DHA, Farmers Choice Milk Beverage, and Cali-Wraps with
MEG-3 Tortillas.
Bronze Medal: It was another year of growth and investment for Main
Street Ingredients, with 2005 revenues up 32% to $75 million. In 2005,
Main Street invested more than $3.6 million, adding 40,000 square feet to its
facility, building an R&D Center, adding a new ice cream pilot plant, and
installing an advanced blending system. In addition, Main Street became the
exclusive marketer for all whey products for Alto Dairy Cooperative, adding
roughly 60 million pounds to its portfolio. Main Street manufactures and distributes
quality ingredients to the dairy, nutritional and food industries and employs
over 110 people.
2005 Stock Performance
Gold Medal: Hansen Natural
for consistently phenomenal growth in sales and share price. After a gold medal
in 2004 on a price gain of 332%, Hansen shares rocketed another 333% in 2005.
In what was generally a mediocre year for major U.S. stock indexes, with the
Dow Jones Industrial Average falling 0.6%, the Nasdaq up only 1.4% and the Standard
& Poor’s 500 rising just 3%, Hansen Natural gained from a split-adjusted
$18.20 per share to end 2005 at $78.81. The stock stayed hot in January, cracking
$100 and hitting a new high of $102.21 with an 11% gain on January 13, 2006.
Recent performance has no doubt disappointed a number of short sellers that
reportedly held as much as 23% of outstanding shares in December 2005. Short
selling was likely kicked off by reports circulating that the growth run of
energy beverages would soon end and that Coke’s re-entry would cramp firms
like Hansen. However, most analysts have reissued higher target and buy ratings
in 2006. Hansen’s sales through the third quarter of 2005 were $302 million,
up 86% from $162 million in the first three quarters of 2004.
Silver Medal: Gaiam
Inc. for posting a 120% share gain in 2005 to end the year at $13.51
and a market cap of $273 million. Gaiam bills itself as a lifestyle media company
catering to people who value personal development, natural health and inspirational
media. Through three quarters of 2005, Gaiam generated $30 million in revenue
compared to $21 million in 2004, a year that was a disappointingly flat for
Gaiam and blamed mostly on the transition from VHS to DVD. The 2005 revenue
increase was contributed equally by the direct-to-consumer segment (including
gaiam.com) and the business segment. The latter sells directly to retailers,
and Gaiam products are available in over 25,000 stores including over 4,200
stores with custom-fixture "store-within-store" lifestyle presentations.
Gaiam made some interesting transactions in 2005. During the third quarter Steve
Case’s Revolution Living purchased $20 million of Gaiam stock, and Gaiam
invested $7.5 million in LIME Media, a TV and radio network. Additionally, Gaiam
raised $19 million from the sale of stock to Prentice Capital Management. In
September, Gaiam acquired the assets of GoodTimes Entertainment for $35
million in cash. Operating as GT Media the product line includes fitness regimens,
children’s & family entertainment and movies and boasts characters
such as Benji, Richard Simmons and Felix the Cat. GT Media also describes itself
as a "leader in multi-channel marketing and sales – specifically via
direct response television (DRTV), distribution to retailers, and the Internet."
Overall, Gaiam expects to generate over $200 million revenues in 2006.
Bronze Medal: Matrixx
Initiatives Inc. for an 82% gain in share price in 2005 to reach $21/share
and a market cap of $200 million at year’s end. Shares also jumped 10%
in early January to hit a new high of $23.45. Although final 2005 financials
have yet to be reported, Matrixx expected net sales to be 45-50% above 2004’s
figure of $60 million, or approaching $90 million for the year. Matrixx growth
has been fueled by the success of its Zicam flu, cold and cough products
and the more recent Nasal Comfort line. In addition, in November 2005,
Matrixx acquired the assets of Viridian Packaging Solutions LLC, its
manufacturer of dry handle swab products for a consideration of roughly $1 million.
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