Piper Jaffray Comments On Physicians Formula Gross Revenue

According to Piper Jaffray, Physicians Formula FACE gross revenue increased in the high-single-digits during FQ2. Piper Jaffray said that this was offset by $2.7 million in incremental consumer and trade promotion spending (a contra-revenue item), thus net sales were up 0.6% y/y in FQ2 versus our estimate of +2.4%. “Despite the slight revenue shortfall, management remains optimistic about this year's class of new products, which saw point-of-sale revenue growth of 19% y/y during FQ2. Net sales and EPS guidance were reaffirmed for FY11.” Physicians Formula closed yesterday at $3.25.