Mannatech, Incorporated, a Texas-based wellness products company, has received a notification from the Nasdaq Stock Market indicating non-compliance with the minimum stockholders' equity requirement for continued listing on the Nasdaq Global Market. As of June 30, 2024, Mannatech's stockholders' equity stood at $8.199 million, below the required $10 million threshold.
The notice, dated August 19, 2024, does not immediately affect the trading of Mannatech's common stock, which continues to be listed under the ticker symbol "MTEX". The company has until October 3, 2024, to submit a plan to regain compliance. If Nasdaq accepts the plan, Mannatech may be granted up to 180 days, until February 15, 2025, to meet the listing standards.
Mannatech is exploring various options to address the shortfall and plans to submit a compliance plan by the given deadline. Despite the current situation, the company believes it could transfer its listing to the Nasdaq Capital Market, where it could continue to meet the listing requirements.
The potential delisting raises concerns about Mannatech's ability to sell equity securities and the liquidity of its common stock. The company's risk factors, as disclosed in its SEC filings, highlight the adverse effects of a delisting from the Nasdaq Global Market or failure to transfer to another stock market.
In other recent news, Mannatech Incorporated announced significant developments in its annual Shareholders' Meeting and a strategic expansion into the Thailand market. The health and wellness company disclosed the re-election of its Class I directors, Larry A. Jobe and Kevin Robbins, and the ratification of BDO USA, P.C. as the company's independent public accounting firm for the fiscal year ending December 31, 2024. These decisions were made by a significant majority of shareholders, representing approximately 62.1% of the total shares outstanding.
In addition to these governance changes, the shareholders also approved the executive compensation, commonly known as "Say-on-Pay", on an advisory basis. The proposal received a considerable number of votes in favor, further strengthening the company's governance structure.
Moving beyond governance matters, the company also unveiled its expansion into the Thailand market, marking the company's presence in 26 markets globally. This strategic move aims to introduce Mannatech's Glycan technology-based products to a new demographic and tap into the substantial growth potential of the Thailand direct sales and dietary supplement markets.
The company's CEO, Landen Fredrick, and General Manager of Mannatech Korea, Roh Jae-hong, have led this expansion following extensive market research. This development aligns with Mannatech's broader strategy to pioneer the Southeast Asian market, with Thailand serving as a key entry point. These recent developments reflect the company's ongoing commitment to growth and strategic expansion.
InvestingPro Insights
Amidst the challenges faced by Mannatech, including the recent notice of non-compliance from the Nasdaq, there are some financial metrics and insights from InvestingPro that could be of interest to investors. Mannatech holds more cash than debt on its balance sheet, which may provide some financial flexibility as they work to address compliance issues. Additionally, the company boasts impressive gross profit margins, with the last twelve months as of Q2 2024 showing a margin of 77.67%. This indicates that Mannatech is able to retain a significant portion of its sales as gross profit.
However, investors should consider that Mannatech is not profitable over the last twelve months, and the company's valuation implies a poor free cash flow yield, according to InvestingPro Tips. These factors are critical when assessing the company's financial health and future prospects. For those interested in dividend income, it is notable that Mannatech pays a significant dividend to shareholders, with a yield of 11.43% as of the latest data.
With a market capitalization of $13.19 million and trading near its 52-week low, Mannatech's stock price may reflect investor concerns and the current operational challenges. The company's revenue has also seen a decline of 10.38% in the last twelve months as of Q2 2024, which could be contributing to the stock's performance. For a deeper analysis and more InvestingPro Tips, investors can visit the dedicated page for Mannatech on InvestingPro.
InvestingPro provides a comprehensive set of additional tips (8 in total) that can offer investors further insights into Mannatech's financial position and stock performance. These tips and data points can help investors make more informed decisions about their investment in Mannatech.
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