WESTLAKE, Texas, Nov. 4, 2008 (GLOBE NEWSWIRE) -- Animal Health International, Inc. (Nasdaq:AHII) announced today that net sales increased 2.8%, or $4.6 million, to $169.0 million for the three months ended September 30, 2008, compared with the same quarter last year. Acquisitions accounted for $11.3 million of sales. Organic sales declined 4.1% from the same period last year. Net income was $0.3 million or $0.01 per fully diluted share. Last year the net income for the first quarter was $1.0 million or $0.04 per fully diluted share.

 * Margins improved during the first quarter to 17.9% of net sales
   compared to 17.4% last year.  Transactional profit margins were up
   0.8% versus last year but offset 0.4% by higher transportation cost.
 * SG&A expenses increased due to the acquisition of Kane Veterinary
   Supplies and higher fuel costs.

Earnings before interest, tax, depreciation and amortization (EBITDA) for the quarter was $4.9 million, a decrease of $1.1 million or 18.2% compared to the same period last year.

As of September 30, 2008, our asset based loan had $31.8 million of availability.

Fiscal Year 2009 Guidance

The following statements are based on current information and the Company assumes no obligation to update them. These statements are forward-looking and inherently uncertain.

Due to lower spending by production animal customers whose profits have been constrained by fluctuating commodity prices, the Company is revising its guidance for fiscal year 2009. Net sales for fiscal year 2009 are now expected to be in the range of $650 to $680 million. EBITDA is estimated to be in the range of $29.0 to $33.0 million, and net income for its fiscal year to be in the range of $7.3 to $9.3 million. This excludes any projections for future acquisitions.

Jim Robison, chairman and CEO, stated, "We do not believe that the slowing of our markets is structural, and we are optimistic about the long term prospects for our company and industry. However, given the disappointing results this quarter, we are taking the following actions: (1) consolidating non-profitable locations; (2) reducing headcount, freezing salary and wage increases, and suspending bonuses; (3) reducing freight and fuel utilization; and (4) adjusting pricing and credit procedures."

Conference Call

The Company plans to host its investor conference call today at 10:00 a.m. Eastern Standard Time to discuss these results and its business outlook. You can access the conference call by dialing 719-785-1758. Participants will be required to register their name and company affiliation for the conference call. Audio replay will be made available by accessing the Company's web site at www.ahii.com under the Investor Relations tab.

Use of Non-GAAP measures

EBITDA represents net income before interest expense, income tax expense, depreciation and amortization and acquisition costs. We present EBITDA as a supplemental performance measure because we believe it facilitates operating performance comparisons from period to period and company to company by backing out potential differences caused by variations in capital structures (affecting interest expense), tax positions (such as the impact on periods or companies of changes in effective tax rates or net operating losses), the age and book depreciation of fixed assets (affecting relative depreciation expense) and the impact of purchase accounting. Because EBITDA facilitates internal comparisons of our historical financial position and operating performance on a more consistent basis, we also use EBITDA in measuring our performance relative to that of our competitors and in evaluating acquisition opportunities. EBITDA is not a measurement of our financial performance under generally accepted accounting principles in the United States, or GAAP, and should not be considered as an alternative to net income, operating income or any other performance measures derived in accordance with GAAP or as an alternative to cash flow from operating activities as a measure of our profitability or liquidity. We understand that although EBITDA is frequently used by securities analysts, lenders and others in their evaluation of companies, EBITDA has limitations as an analytical tool, and you should not consider it in isolation, or as a substitute for analysis of our results as reported under GAAP.