Mannatech (MTEX) 8-K Mannatech, Inc. Reports Second Quarter 2007

Exhibit 99.1

Mannatech, Inc. Reports Second Quarter 2007

Net Sales up 6.1%, EPS Decrease of 80.6%

Coppell, TX, August 8, 2007 –Mannatech, Inc. (NASDAQ – MTEX) today reported second quarter earnings of $0.06 per diluted share for the three months ended June 30, 2007, down 80.6% from the second quarter, 2006, earnings per diluted share of $0.31. Net income for the second quarter, 2007, declined to $1.5 million, a decrease of 82.3% compared to $8.6 million in the second quarter of 2006. Pretax profit was $2.6 million, a decrease of 80.4% compared to $13.4 million in the same period last year. Additional depreciation expense occurred in the second quarter mainly due to the launch of a new Enterprise Resource Planning Software (GlobalView) system at the beginning of the quarter, which impacted pre-tax earnings by $1.4 million.

Second quarter net sales for 2007 were $111.2 million, an increase of 6.1% compared to $104.8 million in the second quarter of 2006. Strong sales gains in our Asian markets plus increased pack sales driven by the U.S. launch of the Optimal Skin Care System helped account for the sales growth.

Total independent Associate and Member count based on a 12-month trailing period increased to 569,000 for the second quarter of 2007 as compared to 526,000 for the second quarter of 2006. The 8.2% growth resulted from higher retention of continuing independent Associates and Members which were up 61,000, a 19.7% increase compared to the same period last year. This increase was partially offset by an 8.3% decline in new independent Associates and Members on a 12-month trailing basis.

Sam Caster, Chairman of the Board and CEO commented, “On a quarter-to-quarter basis, we added the largest number of new independent Associates and Members since the second quarter of 2006. At the same time, we experienced higher than expected operating expenses due to the integration of our new GlobalView system and upgraded web interface used by Associates. In addition, several other factors contributed to increased operating expenses, including higher commissions and incentives, higher cost of goods sold, and increased legal expenses, leading to a considerable reduction in profit.”

Mr. Caster continued, “We have addressed a number of the issues that arose during the implementation phase of our GlobalView system and web interface, and those systems are now running closer to expectations. However, in addition to continuing higher depreciation, we expect to incur greater than historical expenses at least through the end of 2007, to ensure reaching the system’s full potential.”

Year-to-date sales through June reached $216.0 million, up 6.0% from 2006. Net income for the six-month period was $8.4 million, down 42.0% from last year’s net income of $14.5 million. Diluted earnings per share were $0.31, a decrease of 41.5% versus $0.53 for the six-months ended June 2006.

For geographical purposes, consolidated net sales primarily shipped to customers in these locations were as follows:

Net Sales in Dollars and as a Percentage of Consolidated Net Sales

(In millions, except percentages)

	For the three months ended June 30,
	2006					2007				Dollar change			Percentage change
United States	$	70.0		66.8	%	$	67.2	60.4	%	($	2.8	)	(4.0	%)
Canada		7.6		7.3	%		8.0	7.2	%		0.4		5.3	%
Australia		7.5	*	7.2	%*		7.7	6.9	%		0.2		2.7	%
United Kingdom		1.9		1.8	%		1.6	1.4	%		(0.3	)	(15.8	%)
Japan		10.9		10.4	%		11.4	10.2	%		0.5		4.6	%
New Zealand		2.2	*	2.0	%*		1.9	1.7	%		(0.3	)	(13.6	%)
Republic of Korea		2.3		2.2	%		10.4	9.4	%		8.1		352.2	%
Taiwan		1.0		1.0	%		1.4	1.3	%		0.4		40.0	%
Denmark		0.9		0.9	%		0.4	0.4	%		(0.5	)	(55.6	%)
Germany		0.5		0.4	%		1.2	1.1	%		0.7		140.0	%
Totals	$	104.8		100	%	$	111.2	100	%	$	6.4		6.1	%

* In our second quarter 2006 Form 10-Q filed on August 9, 2006, we originally reported Australia and New Zealand net sales to be $8.9 million and $0.8 million, respectively, which represented 8.5% and 0.7% of total consolidated net sales, respectively. The original calculation included a miscalculation in the allocation between country sales. However, the total consolidated net sales was correctly reported at $104.8 million.

	For the six months ended June 30,
	2006					2007				Dollar change			Percentage change
United States	$	137.1		67.3	%	$	135.8	62.9	%	($	1.3	)	(0.9	%)
Canada		14.9		7.3	%		14.6	6.8	%		(0.3	)	(2.0	%)
Australia		15.3	*	7.5	%*		15.0	6.9	%		(0.3	)	(2.0	%)
United Kingdom		3.8		1.9	%		3.3	1.5	%		(0.5	)	(13.2	%)
Japan		20.1		9.9	%		21.1	9.8	%		1.0		5.0	%
New Zealand		4.8	*	2.3	%*		3.8	1.7	%		(1.0	)	(20.8	%)
Republic of Korea		3.9		1.9	%		16.7	7.7	%		12.8		328.2	%
Taiwan		1.8		0.9	%		2.5	1.2	%		0.7		38.9	%
Denmark		1.4		0.7	%		0.9	0.4	%		(0.5	)	(35.7	%)
Germany		0.6		0.3	%		2.3	1.1	%		1.7		283.3	%
Totals	$	203.7		100	%	$	216.0	100	%	$	12.3		6.0	%

* In our second quarter 2006 Form 10-Q, filed on August 9, 2006, we originally reported Australia and New Zealand net sales to be $16.8 million and $3.3 million, respectively, which represented 8.2% and 1.6% of total consolidated net sales, respectively. The original calculation included a miscalculation in the allocation between country sales. However, the total consolidated net sales was correctly reported at $203.7 million.

The number of new and continuing independent associates and members who purchased packs during the 12-months ended June 30, 2006 and 2007 were as follows:

	June 30, 2006		June 30, 2007		Number and percentage change
New	217,000	41.3%	199,000	34.9%	(18,000)	(8.3%)
Continuing	309,000	58.7%	370,000	65.1%	61,000	19.7%
Total	526,000	100.0%	569,000	100.0%	43,000	8.2%

Conference Call

Mannatech will hold a quarterly conference call and webcast to discuss this announcement with investors on Thursday, August 9, 2007 at 9:00 a.m. Central Daylight Time, 10:00 a.m. Eastern Daylight Time. Investors may listen to the call by accessing Mannatech’s website at www.mannatech.com.

About Mannatech

Mannatech, Incorporated is a global wellness solutions provider of innovative, high-quality, proprietary nutritional supplements, topical and skin care products, and weight management products sold through independent Associates and Members located in the United States and the international markets of Canada, Australia, the United Kingdom, Japan, New Zealand, the Republic of Korea, Taiwan, Denmark, and Germany.

Please Note: This release contains “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, Section 21E of the Securities Exchange Act of 1934, as amended, and the Private Securities Litigation Reform Act of 1995. These forward-looking statements generally can be identified by use of phrases or terminology such as “will continue” or other similar words or the negative of such terminology. Similarly, descriptions of Mannatech’s objectives, strategies, plans, goals or targets contained herein are also considered forward-looking statements. Mannatech believes this release should be read in conjunction with all of its filings with the United States Securities and Exchange Commission and cautions its readers that these forward-looking statements are subject to certain events, risks, uncertainties, and other factors. Some of these factors include, among others, Mannatech’s inability to attract and retain associates and members, increases in competition, litigation, regulatory changes, and its planned growth into new international markets. Although Mannatech believes that the expectations, statements, and assumptions reflected in these forward-looking statements are reasonable, it cautions readers to always consider all of the risk factors and any other cautionary statements carefully in evaluating each forward-looking statement in this release, as well as those set forth in its latest Annual Report on Form 10-K, and other filings filed with the United States Securities and Exchange Commission, including its current reports on Form 8-K. All of the forward-looking statements contained herein speak only as of the date of this release.

Contact Information:

Gary Spinell, Vice President

Investor Relations

972-471-6512

ir@mannatech.com

Corporate website:www.mannatech.com

(Complete quarterly report filed on its Form 10-Q, which is expected to be filed with the Securities & Exchange Commission and published on its corporate website www.mannatech.com on or about May 10, 2007. Unaudited Consolidated Financial Statements to follow)

MANNATECH, INCORPORATED

CONSOLIDATED BALANCE SHEETS

(in thousands, except share and per share amounts)

	December 31, 2006			June 30, 2007
ASSETS				(unaudited)
Cash and cash equivalents	$	45,701		$	38,189
Restricted cash		2,251			974
Accounts receivable, net of allowance of $0.2 million in 2006 and $0.4 million in 2007		999			1,047
Income tax receivable		2,155			1,373
Inventories, net		23,923			22,171
Prepaid expenses and other current assets		4,323			7,278
Deferred tax assets		1,478			1,472
Total current assets		80,830			72,504
Long-term investments		25,375			25,375
Property and equipment, net		16,523			44,917
Construction in progress		24,725			1,273
Long-term restricted cash		3,132			6,166
Other assets		1,372			1,247
Long-term deferred tax assets		278			53
Total assets	$	152,235		$	151,535
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current portion of capital lease	$	92		$	95
Accounts payable		3,339			3,778
Accrued expenses		26,841			21,468
Commissions and incentives payable		15,511			15,174
Taxes payable		3,556			2,823
Deferred revenue		2,697			3,074
Total current liabilities		52,036			46,412
Capital lease, excluding current portion		349			290
Long-term royalties due to an affiliate		2,879			2,657
Long-term deferred tax liabilities		7,444			7,864
Other long-term liabilities		730			2,285
Total liabilities		63,438			59,508
Commitments and contingencies
Shareholders’ equity:
Preferred stock, $0.01 par value, 1,000,000 shares authorized, no shares issued or outstanding		—			—
Common stock, $0.0001 par value, 99,000,000 shares authorized, 27,617,081 shares issued and 26,409,987 shares outstanding in 2006 and 27,658,048 shares issued and 26,450,954 shares outstanding in 2007		3			3
Additional paid-in capital		38,941			39,710
Retained earnings		66,393			69,205
Accumulated other comprehensive loss		(1,749	)		(2,100	)
		103,588			106,818
Less treasury stock, at cost, 1,207,094 shares in 2006 and 2007		(14,791	)		(14,791	)
Total shareholders’ equity		88,797			92,027
Total liabilities and shareholders’ equity	$	152,235		$	151,535

MANNATECH, INCORPORATED

CONSOLIDATED STATEMENTS OF OPERATIONS –(UNAUDITED)

(in thousands, except per share information)

	Three months ended June 30,						Six months ended June 30,
	2006			2007			2006			2007
Net sales	$	104,771		$	111,192		$	203,742		$	215,992
Cost of sales		14,719			16,003			29,280			30,696
Commissions and incentives		45,998			52,273			91,372			99,226
		60,717			68,276			120,652			129,922
Gross profit		44,054			42,916			83,090			86,070
Operating expenses:
Selling and administrative expenses		18,230			22,270			36,007			41,989
Depreciation and amortization		1,252			2,866			2,250			4,331
Other operating costs		12,417			15,936			23,423			28,085
Total operating expenses		31,899			41,072			61,680			74,405
Income from operations		12,155			1,844			21,410			11,665
Interest income		592			642			1,164			1,288
Other income, net		649			139			135			103
Income before income taxes		13,396			2,625			22,709			13,056
Provision for income taxes		(4,784	)		(1,098	)		(8,189	)		(4,640	)
Net income	$	8,612		$	1,527		$	14,520		$	8,416
Earnings per share:
Basic	$	0.32		$	0.06		$	0.54		$	0.32
Diluted	$	0.31		$	0.06		$	0.53		$	0.31
Weighted-average common shares outstanding:
Basic		26,782			26,433			26,773			26,425
Diluted		27,408			26,983			27,400			26,985