IPO Company Profile
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Natrol, Inc.
21411 Prairie Street, Chatsworth, CA 91311 * (818) 739-6000

The company is a leading marketer and manufacturer of branded, high quality dietary supplements. The company sells its products under the Natrol brand name through domestic health food stores and mass market drug, retail and grocery store chains.

Primary Underwriting Group
ManagerTierPhone
Adams, Harkness & HillLead Manager (617) 371-3705
Nationsbanc Montgomery Securities, Inc.Co-manager (415) 627-2100
Piper Jaffray IncorporatedCo-manager (612) 342-6220

Offering Information
NASNTL:NTOL Manufacturing: SIC 2833
Type of Shares:Common Shares Filing Date:5/7/98
U.S. Shares:3,940,000 Offer Date:7/21/98
Non-U.S. Shares:0 Filing Range:$12.00 - $14.00
Primary Shares:3,940,000 Offer Price:$15.00
Secondary Shares:0 Gross Spread:$1.05
Offering Amount: $51,220,000 Selling:$0.63
Expenses:$1,000,000 Reallowance:$0.10
Post-IPO Shares:13,000,000
Employees:185

Legal Counsel, Auditor and Registrar
Issuer's Law Firm: Goodwin Procter & Hoar
Bank's Law Firm: Hale and Dorr
Registrar/Transfer Agent: BankBoston
Auditor: Ernst & Young

Selected Financial Data

Dollar amounts in U.S. millions except for per share data
3 Month Ending Financials
Full Year
Audited
Income
Latest
Unaudited
Income
Prior
Audited
Income
Balance
Sheet
12/31/97 3/31/98 3/31/97 3/31/98
Revenue:$42.88$13.12$9.91Assets:$32.03
Net Income:$4.19$1.18$0.81Curr Assets:$15.03
EPS:$0.33$0.10$0.05Liabilities:$20.42
Prior EPS:$0.92Curr Liab:$6.60
Cash Flow/Oper:$2.14$3.35$1.41Equity:$11.61
Cash Flow/Fin:$2.60$8.27$0.15Cash:$2.23
Cash Flow/Inv:-$3.22-$11.20$1.56Working Cap:$8.42

Competition
The dietary supplement industry is highly competitive. Numerous companies, many of which have greater financial and other resources than the Company, compete with the Company in the development, manufacture and marketing of dietary supplements. The Company's principal competition comes from major private label and broadline brand manufacturers. In addition, large pharmaceutical companies and packaged food and beverage companies compete with the Company on a limited basis in the dietary supplement market. Increased competition from such companies could have a material adverse effect on the Company because such companies have greater financial and other resources available to them and possess manufacturing, distribution and marketing capabilities far greater than those of the Company. The Company competes on the basis of product quality, pricing, customer service and marketing support. The Company believes that it competes favorably with its competitors on the strength of the Company's strong brand recognition across multiple distribution channels, ability to quickly develop new products with market potential, sophisticated marketing, advertising and promotional support, product quality, and strong and effective sales force and distribution network.

Business Plan
The Company's objective is to enhance its position as a leading marketer and manufacturer of dietary supplements that are strongly identified with the Natrol brand. Key elements of the Company's strategy include the following: (I) Continue to Build Strong Brand Recognition, (ii) Expand Presence and Penetration in the Health Food Store and Mass Market Distribution Channels, (iii) Continue to Develop New Products, (iv) Expand Bulk Sales Buisness, (v) Develop Additional Distribution Channels and (vi) Pursue Strategic Acquisitions.

Use of Proceeds
The proceeds from the proposed offering will be used to repay existing indebtedness, to redeem all outstanding shares of Redeemable Preferred Stock, for capital expenditures and for working capital and for general corporate purposes including possible acquisitions.

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