MusclePharm Announces Restatement of Previously Issued Financial Results; Change Will Not Impact Bottom Line
-- New Revenue Reporting Method Reduces Net Sales and General Administrative Expenses
For the Quarters and Full Year Ended December 31, 2011 and 2012 Preliminary First Quarter Results--
DENVER, May 24, 2012 /PRNewswire/ -- MusclePharm Corporation (OTCBB: MSLP) (the "company"), a nutritional supplement company focusing on all categories of an active lifestyle, today announced that it will be restating its previously issued financial statements for the four quarters and full year ended December 31, 2011, along with revising its preliminary first quarter 2012 financial results in connection with a change in the methodology for reporting its net sales, which the company believes will more accurately portray its operations. The foregoing financial statements and the financial statements for the quarterly periods ended March 31, June 30 and September 30, 2011, may not be relied upon until such time as the respective reports on Form 10-K and Form 10-Q have been amended accordingly.
Prior to the change, the company deducted certain credits and promotions as general and administrative expenses. After analysis and review with the company's independent auditors, the company has determined to net these credits and promotions directly against gross sales. Because this accounting change is a reclassification of expenses in the company's Consolidated Statements of Operations, the company's net loss will not be affected by the restatement, nor does the restatement affect the amounts reported in its unaudited quarterly financial statements during 2011 or audited Consolidated Balance Sheets at December 31, 2011 or Consolidated Statements of Cash Flows for the year ended December 31, 2011.
As a result of the restatement, MusclePharm's net sales will be reduced by:
- $483,838 for the quarter ended March 31, 2011;
- $405,064 for the quarter ended June 30, 2011;
- $1,312,855 for the quarter ended September 30, 2011; and
- $1,423,944 for the year ended December 31, 2011.
Cost of sales will be increased by:
- $77,326 for the quarter ended March 31, 2011;
- $31,171 for the quarter ended June 30, 2011;
- $90,593 for the quarter ended September 30, 2011; and
- $175,365 for the year ended December 31, 2011.
General and administrative expenses will be reduced by:
- $561,164 for the quarter ended March 31, 2011;
- $436,235 for the quarter ended June 30, 2011;
- $1,403,448 for the quarter ended September 30, 2011; and
- $1,599,309 for the year ended December 31, 2011.
In addition, with respect to company's recently announced preliminary financial results for the first quarter of 2012, credits and promotions of $399,742 will be deducted from the reported net sales.
Investors are encouraged to review the company's Current Report on Form 8-K/A, Amendment No. 1 to each of the Quarterly Reports on Form 10-Q for the quarters ended March 31, June 30 and September 30, 2011, respectively, and Amendment No. 1 to the Annual Report on Form 10-K/A expected to be filed as soon as practicable with the U.S. Securities and Exchange Commission for more information on the matters described in this press release. Copies of these filings can be accessed through the "Investors" tab on the company's website.
ABOUT MUSCLEPHARM CORPORATION
MusclePharm is a healthy life-style company that develops and manufactures a full line of NSF International and Informed Choice approved nutritional supplements that are free of banned substances. Based on years of research at the MusclePharm Sports Science Center, the products are created through an advanced six-stage research protocol involving the expertise of top nutritional scientists and field tested by more than one hundred elite professional athletes from various professional sports leagues including the National Football League, Mixed Martial Arts and Major League Baseball. The company's products address all categories of an active lifestyle, including muscle building, weight loss and maintaining general fitness through a daily nutritional supplement regimen. MusclePharm is sold in more than 120 countries and available in over 10,000 U.S. retail outlets, including Dick's Sporting Goods, GNC, Vitamin Shoppe, Vitamin World and Wal-Mart. MusclePharm products also are sold through more than 100 online stores, including bodybuilding.com, Amazon.com and Vitacost.com. For more information, please visit www.musclepharm.com.
For more information, contact:
Roger Pondel/Robert Jaffe
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