FITLIFE BRANDS, INC.
For the period ended Jun 30, 2025. Filed Aug 14, 2025.
View on SEC.govAbout this filing
A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Jun 30, 2025 · Filed Aug 14, 2025
FTLF$7.98-0.3%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2025-03-31; filed 2025-05-15.
0001437749-25-016990
Item 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONSCurrent report: 10-Q
Period ended 2025-06-30; filed 2025-08-14.
0001437749-25-026661
Item 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONSThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 80 previous paragraphs and 98 current paragraphs.
39 unchanged; 32 reworded; 25 added; 8 removed; 1 previous and 2 current paragraphs rearranged.
Tables are not compared: 6 previous and 7 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (25)
Current report
Recent Acquisitions
Current report
Acquisition of Irwin Naturals
Current report
Subsequent to the end of the quarter, on August 8, 2025 (“the Closing Date”), the Company acquired substantially all of the assets of Irwin Naturals and its related affiliates (“Irwin”) through an asset purchase transaction under Section 363 of the US Bankruptcy Code. The Company acquired substantially all of the assets and assumed certain liabilities of Irwin. Total consideration for the acquisition before any post-closing adjustments was approximately $42,500 in cash. Of this amount, $29,750 was funded using proceeds from a new term loan provided by the Bank, $6,000 was funded from a new $10,000 revolving line-of-credit from the Bank, with the remainder funded from the Company’s available cash balances.
Current report
Revenue. Revenue for the three months ended June 30, 2025 decreased 5% to $16,127 compared to $16,930 for the three months ended June 30, 2024. The decrease in revenue for the three months ended June 30, 2025 compared to the prior period is primarily due to declining revenue from MRC, partially offset by an increase in Legacy FitLife revenue.
Current report
Legacy FitLife revenue for the three months ended June 30, 2025 was $7,303, a 7% increase compared to the previous year, primarily driven by a 17% increase in online revenue as well as a 1% increase in wholesale revenue.
Current report
MRC revenue for the three months ended June 30, 2025 was $6,269, a 16% decrease from the same period of last year due primarily to a drop in traffic to its product listing pages on Amazon.
Current report
During the three months ended June 30, 2025, MusclePharm generated revenue of $2,555, a 4% decrease compared to the same quarter last year, with small decreases in both online and wholesale revenue.
Current report
Online revenue during the quarter ended June 30, 2025 was approximately 65% of net revenue, compared to 35% for wholesale channels for the same period. Online revenue during the quarter ended June 30, 2024 was 66% of net revenue compared to 34% for wholesale channels during the same period.
Current report
Gross Margin. Gross margin for the three months ended June 30, 2025 decreased to 42.8% from 44.8% for the comparable prior period. The decrease in gross margin is primarily attributable due to product mix, continued MusclePharm promotional investment, and the impact of tariffs on the Company’s skin care products being sold in Canada.
Current report
Comparison of the six months ended June 30, 2025 to the six months ended June 30, 2024
Current report
MRC revenue for the six months ended June 30, 2025 was $12,943, a 13% decrease compared to the same period of last year, driven by a 13% decrease in online sales.
Current report
MusclePharm revenue for the six months ended June 30, 2025 was $4,518, a 5% decrease compared to the same period of last year, driven by a 21% decrease in wholesale revenue, partially offset by a 13% increase in online revenue.
Current report
Online revenue and wholesale revenue for the six months ended June 30, 2025 and 2024, remained the same at approximately 66% and 34% of total net revenue, respectively.
Current report
Sales to customers in the U.S. were approximately 96% during the six months ended June 30, 2025 and 2024, with the balance of sales to customers primarily in Canada.
Current report
Cost of Goods Sold. Cost of goods sold for the six months ended June 30, 2025 decreased to $18,285 as compared to $18,612 for the six months ended June 30, 2024. This 2% decrease is primarily due to the decrease in revenue.
Current report
Gross Profit. Gross profit for the six months ended June 30, 2025 decreased to $13,778 as compared to $14,867 for the six months ended June 30, 2024. The decrease in gross profit is principally attributable to lower gross profit from MRC and MusclePharm, partially offset by higher gross profit from Legacy FitLife.
Current report
*Advertising andMarketing.*Advertising and marketing expense for the six months ended June 30, 2025 decreased to $2,244 as compared to $2,554 for the same period of the prior year. The 12% decrease is primarily the result of targeted efforts to rationalize the Company’s advertising spend on less effective advertising campaigns.
Current report
SG&A. SG&A expense for the six months ended June 30, 2025 decreased to $4,997 as compared to $5,036 for the six months ended June 30, 2024.
Current report
*Merger andAcquisitionRelated.*Merger and acquisition related expense increased to $1,028 during the six months ended June 30, 2025 compared to $158 for the same period of 2024, driven primarily by transaction costs related to the Irwin acquisition during the first six months of 2025.
Current report
For the second quarter of 2025, gross margin decreased to 46.5% from 48.2% during the same period last year, primarily due product mix and the impact of tariffs on certain of the Company’s skin care products.
Current report
On August 8, 2025 (the “Closing Date”), the Company entered into the Credit Agreement with First-Citizens Bank & Trust Company (the “Bank”). Pursuant to the Credit Agreement, the Bank provided the Company with a five-year term loan in the amount of $40,625 (“Term Loan”) and a three-year revolving line of credit of up to $10,000 (the “Credit Line”, and collectively with the Term Loan, the “Loan”). The Company used $29,750 from the Term Loan to complete the purchase of substantially all of the assets of Irwin, and its related affiliates, pursuant to an Asset Purchase and Sale Agreement (“APA”), and $10,875 to pay off, retire and replace all existing debt of the Company as of the Closing Date.
Current report
Pursuant to the Credit Agreement, the Term Loan accrues interest at a per annum rate equal to 2.50% to 3.00%, based on leverage, above a forward-looking term rate, based on the secured overnight financing rate published by the Federal Reserve Bank of New York for the applicable selected interest period of one, three or six months (“Term SOFR Rate”), the Term SOFR Rate together with the aforementioned margin, the “Applicable Rate”), and the Company shall make payments of accrued interest on the Term Loan at the end of each interest period and shall make payments on March 31, June 30, September 30 and December 31, of each calendar year, commencing on December 31, 2025, of principal on the Term Loan in amounts equal to 3.75% of the then-outstanding principal balance of the Term Loan for the first eight such payment dates and 5.00% thereafter, in each case plus accrued interest, with all remaining principal and accrued interest on the Term Loan being due and payable in full on August 8, 2030; and outstanding advances under the Credit Line (“Advances”) will accrue interest at the Applicable Rate, and the Company shall make payments of accrued interest on such Advances at the end of each interest period and on the repayment of any Advance with all remaining principal and accrued interest on the Advances being due and payable in full on August 8, 2028.
Current report
Goodwill
Current report
Online revenue during the quarter ended June 30, 2025 was approximately 65% of net revenue, compared to 35% for wholesale channels for the same period. Online revenue during the quarter ended June 30, 2024 was 66% of net revenue compared to 34% for wholesale channels during the same period in 2024.
Current report
Online revenue during the six months ended June 30, 2025 and 2024 was approximately 66% of net revenue, compared to 34% for wholesale channels for the same periods.
Removed paragraphs (8)
Previous report
MRC revenue for the three months ended March 31, 2025 was $6,674, an 11% decrease compared to $7,493 for the three months ended March 31, 2024.
Previous report
MusclePharm revenue for the three months ended March 31, 2025 was $1,963, a 6% decrease compared to $2,095 for the three months ended March 31, 2024.
Previous report
Online revenue for the quarter ended March 31, 2025 was approximately 67% of total net revenue, compared to 65% of total net revenue for the quarter ended March 31, 2024.
Previous report
For the first quarter of 2025, MRC gross margin decreased to 45.4% from 47.0% during the same period last year.
Previous report
In addition, the Company is exploring additional new product launches and continues to have productive discussions with a number of potential new wholesale partners.
Previous report
Also pursuant to the Amended Credit Agreement, the Term Loans accrue interest at an annual rate equal to the greater of 3.50% or the one-month SOFR rate plus 2.75%, and principal plus accrued interest will be payable quarterly in June, September, December, and March, in amounts sufficient to fully amortize the Term Loans through February 28, 2028 in the case of Term Loan A and through October 10, 2028 in the case of Term Loan B. The Company may prepay amounts borrowed under the Term Loans, in whole or in part with accrued interest to the date of such prepayment on the amount prepaid, by written notice to the Lender at least one business day prior to the proposed prepayment.
Previous report
Goodwill and Intangibles
Previous report
Online revenue during the three months ended March 31, 2025 was approximately 67% of total revenue, compared to 65% for the three months ended March 31, 2024.
Reworded paragraphs (32)
Previous wording
Sales to customers in the U.S. were approximately 96% during the quarters ended March 31, 2025 and 2024, respectively, with the balance of sales to customers primarily in Canada.
Current wording
Sales to customers in the U.S. were approximately 96% during the quarters ended June 30, 2025 and 2024, with the balance of sales to customers primarily in Canada.
Previous wording
Cost of Goods Sold. Cost of goods sold for the three months ended March 31, 2025 decreased to $9,062 as compared to $9,262 for the three months ended March 31, 2024. This 2% decrease is primarily due to a decrease in revenue attributable to MRC.
Current wording
Cost of Goods Sold. Cost of goods sold for the three months ended June 30, 2025 decreased to $9,223 as compared to $9,350 for the three months ended June 30, 2024. This 1% decrease is primarily due to the decrease in revenue.
Previous wording
Gross Profit. Gross profit for the three months ended March 31, 2025 decreased to $6,874 as compared to $7,287 for the three months ended March 31, 2024. This 6% decrease in gross profit is principally attributable to lower gross profit from MRC and MusclePharm, partially offset by an increase from Legacy FitLife.
Current wording
Gross Profit. Gross profit for the three months ended June 30, 2025 decreased to $6,904 as compared to $7,850 for the three months ended June 30, 2024. The decrease in gross profit is principally attributable to lower gross profit from MRC and MusclePharm, partially offset by a 6% increase in gross profit from Legacy FitLife.
Previous wording
*Advertising and Marketing.*Advertising and marketing expense for the three months ended March 31, 2025 decreased to $1,053 as compared to $1,228 for the same period of the prior year. The 14% decrease is the result of targeted efforts to optimize the efficiency of the Company’s advertising spend.
Current wording
*Advertising andMarketing.*Advertising and marketing expense for the three months ended June 30, 2025 decreased to $1,191 as compared to $1,326 for the same period of the prior year. The 10% decrease is the result of targeted efforts to rationalize the Company’s advertising spend on less effective advertising campaigns.
Previous wording
SG&A. SG&A expense for the three months ended March 31, 2025 was essentially flat relative to the same period of 2024.
Current wording
SG&A. SG&A expense for the three months ended June 30, 2025 decreased 2% to $2,485 as compared to $2,528 for the three months ended June 30, 2024.
Previous wording
*Merger and Acquisition Related.*Merger and acquisition related expense increased to $332 during the quarter ended March 31, 2025 compared to $134 for the same period of 2024.
Current wording
*Merger and Acquisition Related.*Merger and acquisition related expense increased to $696 during the quarter ended June 30, 2025 compared to $24 for the same period in 2024, driven by transaction costs related to the Irwin acquisition.
Previous wording
Net Income. We generated net income of $2,018 for the three months ended March 31, 2025 as compared to net income of $2,160 for the three months ended March 31, 2024. The decrease in net income for the three months ended March 31, 2025 compared to the same period in 2024 was primarily attributable to lower revenue and gross profit from MRC and MusclePharm, partially offset by higher revenue and gross profit from Legacy FitLife, as well as a decrease in operating expense driven by lower advertising spend and lower interest expense due to the lower debt balances carried by the Company.
Current wording
Net Income. We generated net income of $1,747 for the three months ended June 30, 2025 as compared to net income of $2,628 for the three months ended June 30, 2024. The decrease in net income for the three months ended June 30, 2025 compared to the same period in 2024 was primarily attributable to lower revenue and gross profit as well as an increase in merger and acquisition related expense.
Previous wording
Revenue. Revenue for the three months ended March 31, 2025 decreased 4% to $15,936 as compared to $16,549 for the three months ended March 31, 2024. The decrease in revenue for the three months ended March 31, 2025 compared to the prior period is primarily due to lower MRC sales, partially offset by an increase in Legacy FitLife revenue.
Current wording
Revenue. Revenue for the six months ended June 30, 2025 decreased 4% to $32,063 as compared to $33,479 for the six months ended June 30, 2024. The decrease in revenue for the six months ended June 30, 2025 compared to the prior period is primarily due to lower MRC sales, partially offset by an increase in Legacy FitLife revenue.
Previous wording
Legacy FitLife revenue for the three months ended March 31, 2025 was $7,299, a 5% increase compared to $6,961 for the three months ended March 31, 2024, driven by an 11% increase in online revenue and a 2% increase in wholesale revenue..
Current wording
Legacy FitLife revenue for the six months ended June 30, 2025 was $14,602, a 6% increase compared to the previous year, driven by a 14% increase in online revenue as well as a 2% increase in wholesale revenue.
Previous wording
Gross Margin. Gross margin for the three months ended March 31, 2025 decreased to 43.1% from 44.0% for the comparable prior period. The decrease in gross margin is primarily attributable to lower margins from both MRC and MusclePharm, partially offset by higher margins from Legacy FitLife.
Current wording
Gross Margin. Gross margin for the six months ended June 30, 2025 decreased to 43.0% from 44.4% for the comparable prior period. The decrease in gross margin is primarily attributable to lower margins from both MRC, in part due to tariffs and changing product mix, and MusclePharm, partially offset by higher margins from Legacy FitLife.
Previous wording
One of the primary metrics used by management to evaluate the performance of the Company’s brands is contribution, a non-GAAP financial measure which management defines as gross profit less advertising and marketing expenditures. Other companies may also report contribution as a performance metric, but their definition or calculation of contribution may differ from the Company’s. Management believes that contribution, as defined by the Company, is a particularly relevant performance metric since it incorporates the gross profit associated with a specific brand or collection of brands as well as the advertising and marketing expenditures associated with the same brand or brands. With limited exceptions, other operating expenses incurred by the Company are generally not allocable to a specific brand or collection of brands. Management intends to provide this level of disclosure for no more than two years following a transaction, after which the performance of acquired brands will be reported as part of Legacy FitLife results.
Current wording
One of the primary metrics used by management to evaluate the performance of the Company’s brands is contribution, a non-GAAP financial measure which management defines as gross profit less advertising and marketing expenditures. Other companies may also report contribution as a performance metric, but their definition or calculation of contribution may differ from the Company’s. Management believes that contribution, as defined by the Company, is a particularly relevant performance metric since it incorporates the gross profit associated with a specific brand or collection of brands as well as the advertising and marketing expenditures associated with the same brand or brands. With limited exceptions, other operating expenses incurred by the Company are generally not allocable to a specific brand or collection of brands. Management intends to provide this level of disclosure for approximately two years following a transaction, after which the performance of acquired brands will be reported as part of Legacy FitLife results.
Previous wording
For the first quarter of 2025, Legacy FitLife revenue increased 5% compared to the same period last year, driven by an 11% increase in online revenue and a 2% increase in wholesale revenue compared to the first quarter of 2024. As previously disclosed, during the fourth quarter of 2024, a commercial dispute with GNC, the Company’s largest customer, resulted in the Company rejecting all purchase orders from GNC beginning on December 1, 2024. However, any product that was ordered by GNC prior to December 1, 2024 continued to be shipped and was all received by GNC prior to the end of December 2024. In early January 2025, the Company began selling and shipping product directly to its GNC franchisee customers. On January 23, 2025, the Company and GNC settled their commercial dispute and the Company immediately began accepting purchase orders from GNC, with shipments to the GNC distribution centers beginning approximately two weeks later. The Company continued shipping directly to GNC franchisees until the GNC distribution centers were restocked. Subsequent to the distribution centers being restocked during February 2025, in the event GNC distribution centers do not have adequate inventory to fulfill franchisee orders of the Company’s products, the Company may make shipments directly to GNC franchisees in order to ensure continued availability of the Company’s products on store shelves.
Current wording
In early January 2025, the Company began selling and shipping product directly to its GNC franchisee customers. On January 23, 2025, the Company and GNC settled their commercial dispute and the Company immediately began accepting purchase orders from GNC, with shipments to the GNC distribution centers beginning approximately two weeks later. The Company continued shipping directly to GNC franchisees until the GNC distribution centers were restocked. Subsequent to the distribution centers being restocked during February 2025, in the event GNC distribution centers do not have adequate inventory to fulfill franchisee orders of the Company’s products, the Company may make shipments directly to GNC franchisees in order to ensure continued availability of the Company’s products on store shelves.
Previous wording
For the first quarter of 2025, gross margin increased to 44.6% from 42.1% during the same period last year. Contribution as a percentage of revenue increased to 43.4% from 40.9% over the same time period.
Current wording
For the second quarter of 2025, gross margin decreased to 43.8% from 44.2% during the same period last year. Contribution as a percentage of revenue decreased to 42.0% from 42.8% over the same time period.
Previous wording
For the first quarter of 2025, MRC revenue decreased 11% compared to the same period in 2024. Over the same time period, gross profit decreased 14% and contribution decreased 9%.
Current wording
For the second quarter of 2025, MRC revenue decreased 16% compared to the same period in 2024. Over the same time period, gross profit decreased 19% and contribution decreased 17%.
Previous wording
Revenue for the largest MRC brand, Dr. Tobias, decreased 11% in the first quarter of 2025 while revenue for the skin care brands, Maritime Naturals and All Natural Advice, declined 14%, or 9% on a constant currency basis, in the same period compared to the first quarter of 2024.
Current wording
Revenue for the largest MRC brand, Dr. Tobias, decreased 16% in the second quarter of 2025 while revenue for the skin care brands, Maritime Naturals and All Natural Advice, declined 20% in the same period compared to the second quarter of 2024.
Previous wording
The decrease in gross profit for the MRC brands is primarily the result of lower sales. The decrease in gross margin is primarily driven by the change in product mix within the Dr. Tobias brand. The year-over-year increase in contribution as a percentage of revenue for the MRC brands is a function of the optimization of the advertising spend across all MRC brands.
Current wording
The decrease in gross profit for the MRC brands is primarily due to lower revenue. The decrease in gross margin is primarily driven by changes in product mix within the Dr. Tobais brand and tariffs affecting the skin care brands. The year-over-year decrease in contribution as a percentage of revenue for the MRC brands is primarily due to lower gross profit, partially offset by reduced advertising spend.
Previous wording
As previously disclosed, in an effort to drive revenue growth, the Company is making targeted investments in advertising and promotion in both the wholesale and online channels. During the fourth quarter of 2024, the Company offered additional promotional incentives to certain wholesale partners in an effort to drive incremental growth for the MusclePharm brand. The decrease in wholesale revenue during the first quarter was primarily due to one of our wholesale customers that took advantage of the Company’s promotional investment during the fourth quarter of 2024 without increasing their sell-through of the product, which has affected their reorder volumes.
Current wording
For the second quarter of 2025, MusclePharm revenue decreased 4% compared to the same period in 2024, with wholesale revenue decreasing 6% and online revenue decreasing 3%. As previously disclosed, in an effort to drive revenue growth, the Company is making targeted investments in advertising and promotion in both the wholesale and online channels. Beginning in the fourth quarter of 2024, the Company offered additional promotional incentives to certain wholesale partners in an effort to drive incremental growth for the MusclePharm brand. The decrease in wholesale revenue that occurred during the first quarter was primarily due to one of our wholesale customers that took advantage of the Company’s promotional investment during the fourth quarter of 2024 without increasing their sell-through of the product, which affected their reorder volumes during the first quarter of 2025.
Previous wording
In mid-March 2025, the Company launched the new MusclePharm Pro Series, a collection of premium sports nutrition products, in a pilot in high-volume Vitamin Shoppe stores (consisting of approximately 60% of Vitamin Shoppe’s nationwide store base). If the pilot effort is successful, the Pro Series is anticipated to be added to the assortment in all Vitamin Shoppe stores and will be exclusive to Vitamin Shoppe for a period of 12 months.
Current wording
In mid-March 2025, the Company launched the new MusclePharm Pro Series, a collection of premium sports nutrition products, in a pilot in high-volume Vitamin Shoppe stores (consisting of approximately 60% of Vitamin Shoppe’s nationwide store base). Following the pilot, some of the MusclePharm Pro Series products will continue to be sold in Vitamin Shoppe, while others will be discontinued. The Company has begun selling the MusclePharm Pro Series products online as well as through international wholesale partners.
Previous wording
For the first quarter of 2025 for the Company overall, revenue decreased 4%, gross profit decreased 6%, and contribution decreased 4% compared to the first quarter of 2024.
Current wording
For the second quarter of 2025 for the Company overall, revenue decreased 5%, gross profit decreased 9%, and contribution decreased 9% compared to the second quarter of 2024.
Previous wording
Gross margin decreased to 43.1% during the first quarter of 2025 compared to 44.0% during the first quarter of last year. Contribution as a percentage of revenue decreased slightly to 36.5% compared to 36.6% during the first quarter of last year
Current wording
Gross margin decreased to 42.8% during the second quarter of 2025 compared to 44.8% during the second quarter of last year. Contribution as a percentage of revenue decreased to 35.4% compared to 36.9% during the first quarter of last year
Previous wording
As of March 31, 2025, the Company had positive working capital of $8,463 compared to $6,832 at December 31, 2024. Our principal sources of liquidity at March 31, 2025 consisted of $5,994 of cash and $2,693 of accounts receivable. The increase in working capital is principally attributable to positive operating cash flows during the three months ended March 31, 2025.
Current wording
As of June 30, 2025, the Company had positive working capital of $9,209, compared to $6,832 at December 31, 2024. Our principal sources of liquidity at June 30, 2025 consisted of $1,585 of cash and $2,488 of accounts receivable. The increase in working capital is principally attributable to positive operating cash flows during the six months ended June 30, 2025.
Previous wording
On February 23, 2023, the Company and the Lender amended the Line of Credit Agreement (the “Prior Credit Agreement”) providing the Company with a term loan for the principal amount of $12.5 million (“Term Loan A”). All other terms of the Credit Agreement remain unchanged. All of the proceeds from Term Loan A were used for the acquisition of MRC.
Current wording
On February 23, 2023, the Company and the Lender amended the Line of Credit Agreement (the “2023 Credit Agreement”) providing the Company with a term loan for the principal amount of $12.5 million (“Term Loan A”). All other terms of the Credit Agreement remain unchanged. All of the proceeds from Term Loan A were used for the acquisition of MRC.
Previous wording
On October 10, 2023, the Company entered into a Second Amended and Restated Credit Agreement (the “Credit Agreement”) with the Lender, amending and restating the Credit Agreement between the Company and the Lender. Pursuant to the Credit Agreement, the Lender provided the Company with an additional term loan (“Term Loan B”, and together with Term Loan A, the “Term Loans”) for the principal amount of $10,000 and extended the Line of Credit of $3.5 million to December 23, 2024. The Company used the proceeds from Term Loan B to fund the acquisition of the MusclePharm assets.
Current wording
On October 10, 2023, the Company entered into a Second Amended and Restated Credit Agreement (the “Prior Credit Agreement”) with the Lender, amending and restating the 2023 Credit Agreement between the Company and the Lender. Pursuant to the Prior Credit Agreement, the Lender provided the Company with an additional term loan (“Term Loan B”, and together with Term Loan A, the “Term Loans”) for the principal amount of $10,000 and extended the Line of Credit of $3.5 million to December 23, 2024. The Company used the proceeds from Term Loan B to fund the acquisition of the MusclePharm assets.
Previous wording
On December 19, 2024, the Company entered into the First Amendment to the Amended Credit Agreement (the “Amended Credit Agreement”) to extend the $3.5 million Line of Credit to April 30, 2026. Pursuant to the Amended Credit Agreement, the Line of Credit accrues interest at an annual rate equal to the greater of 3.50% or the one-month secured overnight financing rate (“SOFR”) rate plus 2.75%, and each advance will be payable on the maturity date with the interest on outstanding advances payable monthly. The Company may, at its option, prepay any borrowings under the Line of Credit, in whole or in part at any time prior to the maturity date, without premium or penalty.
Current wording
On December 19, 2024, the Company entered into the First Amendment to the Amended Credit Agreement (the “Amended Prior Credit Agreement”) to extend the $3.5 million Line of Credit to April 30, 2026. Pursuant to the Amended Prior Credit Agreement, the Line of Credit accrues interest at an annual rate equal to the greater of 3.50% or the one-month secured overnight financing rate (“SOFR”) rate plus 2.75%, and each advance will be payable on the maturity date with the interest on outstanding advances payable monthly. The Company may, at its option, prepay any borrowings under the Line of Credit, in whole or in part at any time prior to the maturity date, without premium or penalty.
Previous wording
The Amended Credit Agreement contains customary events of default (each an “Event of Default”), which upon the occurrence of an Event of Default, as defined in the Amended Credit Agreement, among other things, interest will accrue at the applicable rate plus 2% per annum, and the Lender may declare all obligations, with interest thereon, immediately due and payable. The Amended Credit Agreement further contains customary representations and warranties of the Company; customary indemnification provisions whereby the Company will indemnify Lender for certain losses arising out of inaccuracies in, or breaches of, the representations, warranties and covenants of the Company, and certain other matters; and customary affirmative and negative covenants, including covenants to maintain a Fixed Charge Coverage Ratio (as defined in the Amended Credit Agreement) of not less than 1.25 to 1.00 as tested quarterly on a trailing twelve-month basis, starting with the fiscal quarter ending December 31, 2023, a Funded Debt to EBITDA Ratio (as defined in the Amended Credit Agreement) of not more than 2.50 to 1.00 as tested quarterly on a trailing twelve-month basis, starting with the fiscal quarter ending March 31, 2024, and to the extent the Term Loans still have a balance as of June 30, 2025 and a Cash Flow Leverage threshold (as defined in the Amended Credit Agreement) of at least 1.15 is not met, the Company will be required to make a prepayment on the Term Loans equal to 50% of the Excess Cash Flow (as defined in the Amended Credit Agreement). The Company was in compliance with all covenants as of March 31, 2025.
Current wording
The Credit Agreement contains customary events of default, which upon the occurrence of an Event of Default, among other things, interest will accrue at the Applicable Rate plus 2% per annum, and the Bank may declare all Obligations (as defined in the Credit Agreement) immediately due and payable. The Credit Agreement further contains customary representations and warranties of the Company; customary indemnification provisions whereby the Company will indemnify Bank for certain losses arising out of inaccuracies in, or breaches of, the representations, warranties and covenants of the Company, and certain other matters, and customary affirmative and negative covenants, including covenants to maintain a Senior Funded Debt to EBITDA Ratio (as defined in the Credit Agreement) of not more than 2.75 to 1.00 as tested quarterly on a trailing twelve-month basis, starting with the fiscal quarter ending December 31, 2025 and ending with the fiscal quarter ended June 30, 2026 and a Senior Funded Debt to EBITDA Ratio (as defined in the Credit Agreement) of not more than 2.50 to 1.00 as tested quarterly on a trailing twelve-month basis, starting with the fiscal quarter ending September 30, 2026, and to maintain a Fixed Charge Coverage Ratio (as defined in the Credit Agreement) of at least 1.25 to 1.00 as tested on the last day of each fiscal quarter, commencing with the quarter ending December 31, 2025.
Previous wording
As of March 31, 2025, the borrowings outstanding on the Term Loans and the Line of Credit were $12,000 and $0, respectively.
Current wording
As of June 30, 2025, the borrowings outstanding on the Term Loans and the Line of Credit were $10,875 and $0, respectively.
Previous wording
Cash Provided by Operating Activities. Cash provided by operating activities for the three months ended March 31, 2025 was $2,328 compared to cash provided by operating activities of $5,036 for the three months ended March 31, 2024. The decrease in cash provided by operating activities was primarily due to increases in working capital.
Current wording
Cash Provided by Operating Activities. Cash provided by operating activities for the six months ended June 30, 2025 was $3,523 compared to cash provided by operating activities of $6,606 for the six months ended June 30, 2024. The decrease in cash provided by operating activities was primarily due to increased use of cash in working capital and lower net income compared to the same period of 2024.
Previous wording
Cash Used in Investing Activities. Cash used in investing activities for the three months ended March 31, 2025 and 2024 was $24 and $10, respectively.
Current wording
Cash Used in Investing Activities. Cash used in investing activities for the six months ended June 30, 2025 and 2024 was $5,029 and $10, respectively. The increase in cash used in investing activities was primarily due to a $5,000 deposit the Company paid for the Irwin acquisition.
Previous wording
Cash Used in Financing Activities. Cash used in financing activities for the three months ended March 31, 2025 was $866 compared to cash used in financing activities of $3,625 during the three months ended March 31, 2024. The decrease in cash used in financing activities is primarily due to the voluntary debt repayment made by the Company during the first quarter of 2024.
Current wording
Cash Used in Financing Activities. Cash used in financing activities for the six months ended June 30, 2025 was $1,568 compared to cash used in financing activities of $4,750 during the six months ended June 30, 2024. The decrease in cash used in financing activities was primarily due to the voluntary debt repayment made by the Company during the first quarter of 2024.
Previous wording
Management concluded that a triggering event did not occur during the three months ended March 31, 2025. We will continue to review for impairment indicators as necessary in future periods.
Current wording
Management concluded that a triggering event did not occur during the six months ended June 30, 2025. We will continue to review for impairment indicators as necessary in future periods.
Previous wording
The Company’s products are also sold on e-commerce platforms including Amazon. For these transactions, the Company evaluated principal versus agent considerations to determine appropriateness of recording distribution and platform fees paid to third-party e-commerce companies as an expense or as a reduction of revenue. The Company records distribution and platform fees to cost of goods sold in the condensed consolidated statements of income and comprehensive income. Distribution and platform fees are not recorded as a reduction of revenue because the Company (1) owns the goods before they are transferred to the customer, (2) can direct Amazon, similar to other third-party logistics providers, to return the Company’s inventory to any location specified by the Company, (3) has the responsibility to make customers whole following any returns made by customers directly to Logistic Providers and the Company retains the back-end inventory risk, (4) is subject to credit risk (i.e., credit card chargebacks), (5) establishes prices of its products, (6) can determine who fulfills the goods to the customer (Amazon or the Company) and (7) can limit quantities or stop selling the goods at any time. Based on these considerations, the Company is the principal in this arrangement. Advertising fees for Amazon are recorded in advertising and marketing expense in the condensed consolidated statements of income and comprehensive income.
Current wording
The Company’s products are also sold on e-commerce platforms including Amazon. For these transactions, the Company evaluated principal versus agent considerations to determine appropriateness of recording platform fees paid to Amazon as an expense or as a reduction of revenue. The Company records platform fees paid to Amazon for distribution of Company products to cost of goods sold in the condensed consolidated statements of income and comprehensive income. Distribution and platform fees are not recorded as a reduction of revenue because the Company (1) owns the goods before they are transferred to the customer, (2) can direct Amazon, similar to other third-party logistics providers (“Logistic Providers”), to return the Company’s inventory to any location specified by the Company, (3) has the responsibility to make customers whole following any returns made by customers directly to Logistic Providers and the Company retains the back-end inventory risk, (4) is subject to credit risk (i.e., credit card chargebacks), (5) establishes prices of its products, (6) can determine who fulfills the goods to the customer (Amazon or the Company) and (7) can limit quantities or stop selling the goods at any time. Based on these considerations, the Company is the principal in this arrangement. Advertising fees for Amazon are recorded in advertising and marketing expense in the condensed consolidated statements of income and comprehensive income.
Previous wording
Sales to customers in the U.S. were approximately 96% during the three months ended March 31, 2025 and 2024, respectively, with the balance of sales for the same respective periods being to customers primarily in Canada.
Current wording
Sales to customers in the U.S. were approximately 96% during the three and six months ended June 30, 2025 and 2024, with the balance of sales for the same respective periods being to customers primarily in Canada.
Rearranged current paragraphs (2)
Current report — wording carried from elsewhere
Net Income. We generated net income of $3,765 for the six months ended June 30, 2025 as compared to net income of $4,788 for the six months ended June 30, 2024. The decrease in net income for the six months ended June 30, 2025 compared to the same period in 2024 was primarily attributable to lower revenue and gross profit for MRC and an increase in acquisition-related expense due to the Irwin acquisition.
Current report — wording carried from elsewhere
For the second quarter of 2025, Legacy FitLife revenue increased 7% compared to the same period last year, driven by a 17% increase in online revenue as well as a 1% increase in wholesale revenue. As previously disclosed, during the fourth quarter of 2024, a commercial dispute with GNC, the Company’s largest customer, resulted in the Company rejecting all purchase orders from GNC beginning on December 1, 2024. However, any product that was ordered by GNC prior to December 1, 2024 continued to be shipped and was all received by GNC prior to the end of December 2024.
Rearranged previous paragraphs (1)
Previous report — wording carried elsewhere
For the first quarter of 2025, MusclePharm revenue decreased 6% compared to the same period in 2024, with wholesale revenue decreasing 41% and online revenue increasing 33%.