Vitacost.com, Inc. has set the terms for its upcoming IPO.  The online and catalog seller of vitamins, supplements, and other personal care products is selling 11 million shares, with 4,495,987 shares being sold by the company and some 6,504,013 shares are being sold by holders.  The price range has been indicated as $11 to $13 per share, and it will trade under the NASDAQ ticker “VITC.”

The joint book-running managers are Jefferies & Company and Oppenheimer; and co-Managers are listed as Needham & Company and Roth Capital Partners.  The underwriting group was given an overallotment option of up to 1,650,000 shares of common stock, with some 663,322 being from the company and 986,678 shares from holders.

The company’s common stock is listed as 100,000,000 shares authorized, but its market capitalization will be based upon 27,522,712 shares actually issued.   It does have the allowance for preferred stock with a $0.00001 par value listed as 25,000,000 shares authorized, but no preferred shares were issued or outstanding.

The online retailer and direct marketer of health and wellness products sells its dietary supplements, vitamins, minerals, herbs, botanicals, amino acids, metabolites, cosmetics, organic body and personal care products, sports nutrition and health foods.  It sells directly to the public at vitacost.com and catalogs.  It lists some 23,000 SKU products from more than 1,000 third party brands to the likes of New Chapter, Atkins, Nature’s Way, Twinlab, Burt’s Bees and Kashi.  It also sells its own proprietary brands, Nutraceutical Sciences Institute, Cosmeceutical Sciences Institute, Best of All, Smart Basics, and Walker Diet.

As of June 30, 2009, it lists roughly 957,000 active customers, and that is an increase of 37% since June 30, 2008 of customers who made a purchase within the past 12 months. Vitacost.com said that customers make purchases on average two to three times per year, and over the last twelve quarters its average order value has ranged between $72 and $77.

The company’s fiscal year ended December 31, 2008 had net sales of $143.6 million and net income of $17,407.00 as compared to net sales of $99.3 million and net income of $1.8 million for its fiscal year ended December 31, 2007.  For the six months ended June 30, 2009, it had net sales of $93.2 million and net income of $7.2 million, versus net sales of $68.7 million and net income of $715,000 for the six months ended June 30, 2008.

This one sounds somewhat similar to Vitamin Shoppe and its pending IPO.

JON C. OGG
August 24, 2009

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