Quarterly report [Sections 13 or 15(d)]



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UNITED STATES




SECURITIES AND EXCHANGE COMMISSION




WASHINGTON, DC 20549








FORM 10-Q








(Mark One)


















QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934







For the quarterly period ended March 31, 2021






OR


















TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934







For the transition period from ____ to ____






Commission File Number: 000-55181








Twinlab Consolidated Holdings, Inc.



(Exact name of registrant as specified in its charter)


























Nevada





46-3951742




(State or other jurisdiction of



incorporation or organization)




(I.R.S. Employer



Identification No.)





4800 T-Rex Avenue, Suite 305




Boca Raton, Florida




33431


(Address of principal executive offices)

(Zip Code)





(561) 443-4301










(Registrant’s telephone number, including area code)






Not Applicable





(Former name, former address and former fiscal, if changed since last report)







Securities registered pursuant to Section 12(b) of the Exchange Act:

















Title of each class




Trading Symbol




Name of each exchange on which registered




Common Stock, $0.001 par value per share




TLCC




OTC.PK




Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐





Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐





Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

























Large accelerated filer








Accelerated filer








Non-accelerated filer








Smaller reporting company










Emerging growth company










If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐





Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒





The number of shares of common stock, par value $0.001, outstanding on May 13, 2021 was 259,092,833 shares.



























Forward-Looking Statements





This Quarterly Report on Form 10-Q contains forward-looking statements that involve substantial risks and uncertainties. All statements other than statements of historical facts contained in this Quarterly Report on Form 10-Q, including statements regarding our strategy, future operations, future financial position, future revenue, projected costs, prospects, plans, objectives of management and expected market growth, are forward-looking statements. These statements involve known and unknown risks, uncertainties and other important factors that may cause our actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements.





The words “anticipate,” “believe,” “estimate,” “expect,” “intend,” “may,” “might,” “plan,” “predict,” “project,” “target,” “potential,” “contemplate,” “anticipate,” “goals,” “will,” “would,” “could,” “should,” “continue,” and similar expressions are intended to identify forward-looking statements, although not all forward-looking statements contain these identifying words. These forward-looking statements include, among other things, statements about our plans and ability to raise additional capital, including through equity offerings, debt financings, or other arrangements, and the potential impact of the COVID-19 pandemic on our business operations.





These forward-looking statements are only predictions and we may not actually achieve the plans, intentions or expectations disclosed in our forward-looking statements. You should not place undue reliance on our forward-looking statements. Actual results or events could differ materially from the plans, intentions and expectations disclosed in the forward-looking statements we make. We have based these forward-looking statements largely on our current expectations and projections about future events and trends that we believe may affect our business, financial condition and operating results. We have included important factors in the cautionary statements included in this Quarterly Report on Form 10-Q and in “Part I, Item 1A — Risk Factors” included in our Annual Report on Form 10-K filed with the Securities and Exchange Commission on April 16, 2021 that could cause actual future results or events to differ materially from the forward-looking statements that we make.





You should read this Quarterly Report on Form 10-Q and the documents that we have filed as exhibits to this Quarterly Report on Form 10-Q with the understanding that our actual future results may be materially different from what we expect. We do not assume any obligation to update any forward-looking statements whether as a result of new information, future events or otherwise, except as required by applicable law.
















Twinlab Consolidated Holdings, Inc.






Form 10-Q








TABLE OF CONTENTS






































































































































































































































Page No.




Part I - FINANCIAL INFORMATION










Item 1.




Financial Statements











Condensed Consolidated Balance Sheets (Unaudited)




1










Condensed Consolidated Statements of Operations (Unaudited)




2










Condensed Consolidated Statements of Stockholders’ Deficit (Unaudited)




3










Condensed Consolidated Statements of Cash Flows (Unaudited)




4










Notes to Condensed Consolidated Financial Statements (Unaudited)




5









Item 2.




Management's Discussion and Analysis of Financial Condition and Results of Operations




22









Item 3.




Quantitative and Qualitative Disclosures About Market Risk




25









Item 4.




Controls and Procedures




26










Part II - OTHER INFORMATION










Item 1.




Legal Proceedings




28









Item 1A.




Risk Factors




28









Item 2.




Unregistered Sales of Equity Securities and Use of Proceeds




28









Item 3.




Defaults Upon Senior Securities




28









Item 4.




Mine Safety Disclosures




28









Item 5.




Other Information




28









Item 6.




Exhibits




28










Signatures




29

























PART I.



FINANCIAL INFORMATION












Item 1.





Financial Statements









Twinlab Consolidated Holdings, Inc.




Condensed Consolidated Balance Sheets (unaudited)




(amounts in thousands, except share and per share data)




































































































































































































































































































































































































































































































































March 31, 2021









December 31, 2020







ASSETS

































Current assets:












Cash




$

3,236



$

424



Accounts receivable, net





9,794




8,425



Inventories, net





9,411




6,301



Prepaid expenses and other current assets





2,838




2,195



Total current assets





25,279




17,345












Property and equipment, net





60




65



Right-of-use assets





5,408




4,710



Intangible assets, net





3,159




3,253



Goodwill





8,818




8,818



Other assets





744




760












Total assets




$

43,468



$

34,951













LIABILITIES AND STOCKHOLDERS



DEFICIT

































Current liabilities:












Accounts payable




$

7,299



$

4,712



Lease liabilities





808




742



Accrued expenses and other current liabilities





8,844




9,372



Accrued interest





21,959




20,359



Notes payable and current portion of long-term debt





100,081




96,847



Total current liabilities





138,991




132,032





















Long-term liabilities:












Lease liabilities





5,217




4,592



Notes payable and long-term debt, net of current and debt discount





1,026




476



Total long-term liabilities





6,243




5,068












Total liabilities





145,234




137,100












Stockholders’ deficit:












Preferred stock, $0.001 par value, 500,000,000 shares authorized, no shares issued and outstanding





-




-



Common stock, $0.001 par value, 5,000,000,000 shares authorized, 393,898,884 and 392,864,182 shares issued, respectively





394




393



Additional paid-in capital





231,249




231,250



Stock subscriptions receivable





(30

)



(30

)


Treasury stock, 134,806,051 shares at cost





(500

)



(500

)


Accumulated deficit





(332,879

)



(333,262

)


Total stockholders’ deficit





(101,766

)



(102,149

)











Total liabilities and stockholders' deficit




$

43,468



$

34,951







The accompanying notes are an integral part of these condensed consolidated financial statements.






1












Twinlab Consolidated Holdings, Inc.




Condensed Consolidated Statements of Operations (unaudited)




(amounts in thousands, except share and per share data)



























































































































































































































































































































































Three Months Ended




March 31,












2021











2020







Net sales




$

19,460



$

16,429



Cost of sales





12,342




11,265












Gross profit





7,118




5,164












Operating costs and expenses:












Selling expenses





889




283



General and administrative expenses





3,658




6,857












Income (loss) from operations





2,571




(1,976

)











Other income (expense):












Interest expense, net





(2,169

)



(2,158

)


Gain on change in derivative liabilities





-




(1,030

)


Other (expense)





(19

)



-












Total other income (expense)





(2,188

)



(3,188

)











Income (loss) before income taxes





383




(5,164

)











Provision for income taxes





-




-












Total net income (loss)




$

383



$

(5,164

)











Weighted average number of common shares outstanding - basic





258,058,131




256,785,233



Net income (loss) per common share - basic




$

-



$

(0.02

)











Weighted average number of common shares outstanding - diluted





259,086,561




256,785,233



Net income (loss) per common share - diluted (See Note 2)




$

-



$

(0.02

)






The accompanying notes are an integral part of these condensed consolidated financial statements.








2

















Twinlab Consolidated Holdings, Inc.




Condensed Consolidated Statements of Stockholders



Deficit (unaudited)




(amounts in thousands, except share and per share data)



























































































































































































































































































































































































































Common Stock









Additional






Paid-in









Stock






Subscriptions









Treasury Stock









Accumulated




















Shares









Amount







Capital







Receivable









Shares









Amount









Deficit









Total








































Balance, December 31,


2019





390,449,879



$

390



$

231,253



$

(30

)



134,806,051



$

(500

)


$

(318,873

)


$

(87,760

)


Shares issued upon exercise of warrants





1,141,405




2




(2

)



-




-




-




-




-



Net loss





-




-




-




-




-




-




(5,164

)



(5,164

)



Balance, March 31,


2020





391,591,284



$

392



$

231,251



$

(30

)



134,806,051



$

(500

)


$

(324,037

)


$

(92,924

)




































Balance, December 31,


2020





392,864,182




393




231,250




(30

)



134,806,051




(500

)



(333,262

)



(102,149

)


Shares issued upon exercise of warrants





1,034,702




1




(1

)



-




-




-




-




-



Net income





-




-




-




-




-




-




383




383




Balance, March 31,


2021





393,898,884



$

394



$

231,249



$

(30

)



134,806,051



$

(500

)


$

(332,879

)


$

(101,766

)






The accompanying notes are an integral part of these condensed consolidated financial statements.








3

















Twinlab Consolidated Holdings, Inc.




Condensed Consolidated Statements of Cash Flows (unaudited)




(amounts in thousands)




























































































































































































































































































































































































































Three Months Ended




March 31,










2021









2020






Cash flows from operating activities:












Net income (loss)




$

383



$

(5,164

)


Adjustments to reconcile net loss to net cash used in operating activities












Depreciation and amortization





99




267



Amortization of right-to-use assets





210




193



Amortization of debt discount





215




305



Provision for (recovery of) obsolete inventories





(517

)



180



Provision for (recovery of) for losses on accounts receivable





541




4,097



Gain on change in derivative liability





-




1,030



Other non-cash items





-




5



Changes in operating assets and liabilities:












Accounts receivable





(1,910

)



(2,967

)


Inventories





(2,593

)



(843

)


Prepaid expenses and other current assets





(643

)



(285

)


Other assets





14




18



Accounts payable





2,588




(1,734

)


Lease liabilities





(217

)



(192

)


Accrued expenses and other current liabilities





1,073




2,157












Net cash used in operating activities





(757

)



(2,933

)











Cash flows from financing activities:












Proceeds from the issuance of debt





1,344




5,000



Repayment of debt





-




(2,312

)


Net borrowings from revolving credit facility





2,225




453












Net cash provided by financing activities





3,569




3,141












Net increase in cash





2,812




208



Cash at the beginning of the period





424




270












Cash at the end of the period




$

3,236



$

478












SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:












Cash paid for interest




$

354



$

139







The accompanying notes are an integral part of these condensed consolidated financial statements.






4










Twinlab Consolidated Holdings, Inc.




Notes to Condensed Consolidated Financial Statements (unaudited)




(amounts in thousands, except share and per share amounts)









Note 1



Nature of Business






Nature of Business





Twinlab Consolidated Holdings, Inc. (the “Company”, “Twinlab,” “we,” “our” and “us”) was incorporated on October 24, 2013 under the laws of the State of Nevada as Mirror Me, Inc. On August 7, 2014, we amended our articles of incorporation and changed our name to Twinlab Consolidated Holdings, Inc.





We are an integrated marketer, distributor and retailer of branded nutritional supplements and other natural products sold to and through domestic health and natural food stores, mass market retailers, specialty stores retailers, on-line retailers and websites. Internationally, we market and distribute branded nutritional supplements and other natural products to and through health and natural product distributors and retailers.





Our products include vitamins, minerals, specialty supplements and sports nutrition products sold under the Twinlab brand name, a market leader in the healthy aging and beauty from within categories sold under the Reserveage Nutrition and ResVitale® brand names; diet and energy products sold under the Metabolife brand name; the Re-



The above information was disclosed in a filing to the SEC. To see the filing, click here.

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Departure of Directors or Certain - Oct. 7, 2021

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