Park City company profits decline

NEW YORK -- Nutraceutical International Corp. shares fell more than 26 percent Thursday after the Park City-based company reported lower profits in the recent quarter and an analyst suggested the company is losing market share.

"Softness in sales" within its so-called Healthy Foods distribution channel emerged in the third quarter, according to a statement by Frank W. Gay II, chief executive of the vitamin-maker.

But Seidler Cos. analyst David Block called the statement "somewhat baffling," given his own recent channel check of the sector, which distributes products to health-food stores and chains.

The company is probably losing some market share to other distributors, Block said in a research note Friday.

In an interview, Block added his comment on market share erosion is "speculation" on his part, and he hasn't spoken recently with management. Nutraceutical Chief Financial Officer Leslie M. Brown wasn't immediately available to comment on the question.

The channel is the company's primary focus, although it also operates retail outlets.

Block doesn't own shares, and Seidler says it will seek investment banking business from Nutraceutical.

The company on Thursday reported net income of $2.9 million, or 24 cents per share, for the quarter ended June 30. That compares with $3.2 million, or 28 cents per share, a year earlier. Net sales totaled $33.8 million, up from $29.7 million.

For the nine months ended June 30, net income was $10.2 million, or 87 cents per share, on sales of $104.6 million. That compares with $9.3 million, or 81 cents per share, on sales of $89.2 million for the prior-year period.

Nutraceutical stock fell $4.67, or more than 26 percent, Thursday to close at $13. During the past year, the price has ranged from $9.51 to $27.62. The shares

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