Bowflex (BFXXQ) 8-K Nautilus, Inc. Announces Results for Second Quarter 2008

Exhibit 99.1

Nautilus, Inc. Announces Results for Second Quarter 2008

Significant Restructuring Activity Commenced in the Quarter

VANCOUVER, WA—July 31, 2008 — Fitness company Nautilus, Inc. (NYSE:NLS -News) today announced results for the second quarter ended June 30, 2008.

Loss from continuing operations for the quarter ended June 30, 2008 was $9.6 million or $0.30 per diluted share after recording restructuring related and other charges of $6.6 million, or $0.14 per diluted share after-tax. The charges principally related to severance, inventory reserves and anticipated settlements related to licensing agreements. In the second quarter of 2007, the Company reported income from continuing operations of $0.7 million or $0.02 per diluted share including a benefit of $18.3 million or $0.34 per diluted share after-tax from a litigation settlement. Results from continuing operations exclude the Company’s former apparel business, which is considered a discontinued operation and was sold on April 18, 2008 for $69.4 million. Net loss (including discontinued operations) for the second quarter 2008 was $8.9 million, or $0.28 per diluted share, compared to net income of $1.1 million, or $0.04 per diluted share for the second quarter of 2007.

An important part of our restructuring activities has been the establishment of separate teams with authority and responsibility for the profitability of each of our global business units. We will now be reporting the Commercial, Direct and Retail businesses on a global basis. As a result of changing the reportable business segments in the second quarter of 2008, accounting rules require the Company to perform an interim goodwill impairment test. The Company is in the process of determining whether a goodwill impairment charge is required as of June 30, 2008. An impairment charge, if any, would be a non-cash charge. The Company expects to complete this goodwill impairment assessment prior to the filing of its Form 10-Q for the second quarter.

Net sales from continuing operations for the three months ended June 30, 2008, were $95.6 million compared to $102.5 million for the corresponding period last year, a decrease of 7%. Net sales increases in the Company’s Retail business were offset by declines in the Direct business, principally due to a weak consumer and tight credit environment, as well as declines in Commercial sales principally due to suspending sales of the Commercial TreadClimber. We have commenced work on a new Commercial TreadClimber which we expect to introduce at a future date.

As of June 30, 2008, the Company had a net cash position of $4 million and unutilized borrowing availability of approximately $35 million versus net debt of $71 million at December 31, 2007. During the second quarter of 2008, the Company repurchased $2.2 million of common stock. As of July 29, 2008, the Company had repurchased 981,398 shares of common stock at an average price of $5.16 per share or a total of $5.1 million, leaving $4.9 million remaining on the $10 million share repurchase program authorized by our Board of Directors in May 2008.

“In addition to managing our expenses tightly, we are continuing our thorough review of each business unit with a particular focus on profitable growth,” stated Edward Bramson, Chairman and Chief Executive Officer of Nautilus, Inc. “The four areas of strategic focus are new product development, resolving channel conflict, expanding our share of the cardio market, and capitalizing on our strong portfolio of brands. In order to improve our profitability in the current economic environment, we have initiated a restructuring program which is expected to reduce fixed costs significantly.”

A copy of the presentation detailing the restructuring is available on our website atwww.nautilusinc.com/earnings.

Conference Call and Presentation

The conference call is scheduled for 5:00 p.m. EDT (2:00 p.m. PDT), July 31, 2008. It will be broadcast live over the Internet hosted atwww.nautilusinc.com/events and will be archived online within one hour after completion of the call. The accompanying presentation will be hosted atwww.nautilusinc.com/earnings. In addition, listeners may call (866) 394-6821 in North America and (706) 645-0458 from outside North America. Participants from the Company will be Edward Bramson, Chairman and Chief Executive Officer and Bill Meadowcroft, Chief Financial Officer.

A telephonic playback will be available from 4:00 p.m. PDT, July 31, through 4:00 p.m. PDT, August 14, 2008. North American callers may dial (800) 633-8284 and international callers may dial (402) 977-9140 to hear the playback. The passcode is 21388886.

About Nautilus, Inc.

Headquartered in Vancouver, Wash., Nautilus, Inc. (NYSE:NLS -News) is a global fitness products company providing innovative, quality solutions to help people achieve a healthy lifestyle. With a brand portfolio includingNautilus^®,Bowflex^®,Schwinn^®Fitness,StairMaster^® and Universal^®, Nautilus manufactures and markets innovative fitness products through direct, commercial, retail, and international channels. Formed in 1986, the company had 2007 sales of $502 million. It has 1,100 employees and operations in Washington, Oregon, Colorado, Oklahoma, Virginia, Canada, Switzerland, Germany, United Kingdom, Italy, China and other locations around the world. Website:www.nautilusinc.com

Safe Harbor Statement:

This press release includes forward-looking statements, including statements concerning estimated future profitability and operational improvement. Factors that could cause Nautilus, Inc. actual results to differ materially from these forward-looking statements include availability of media time and fluctuating advertising rates, its ability to successfully transfer products to alternative manufacturing facilities, manufacturing quality issues resulting in increased warranty costs, a decline in consumer spending due to unfavorable economic conditions, its ability to effectively develop, market, and sell future products, its ability to get foreign-sourced product through customs in a timely manner, its ability to effectively identify, negotiate and integrate any future strategic acquisitions, its ability to protect its intellectual property, introduction of lower-priced competing products, unpredictable events and circumstances relating to international operations including its use of foreign manufacturers, government regulatory action, and general economic conditions. Please refer to our reports and filings with the Securities and Exchange Commission, including our most recent annual report on Form 10-K and quarterly reports on Form 10-Q, for a further discussion of these risks and uncertainties. We also caution you not to place undue reliance on forward-looking statements, which speak only as of the date they are made. We undertake no obligation to update publicly any forward-looking statements to reflect new information, events or circumstances after the date they were made or to reflect the occurrence of unanticipated events.

NAUTILUS, INC.

CONSOLIDATED BALANCE SHEETS

(Unaudited, in thousands)

	June 30, 2008		December 31, 2007
ASSETS
CURRENT ASSETS:
Cash and cash equivalents	$	4,433	$	7,911
Trade receivables (net of allowance for doubtful accounts of $4,763 and $4,490 at June 30, 2008 and December 31, 2007, respectively)		54,617		88,311
Inventories, net		62,277		58,910
Prepaid expenses and other current assets		6,774		13,759
Income taxes receivable		15,522		11,382
Assets of discontinued operations		—		73,771
Assets held for sale		1,677		1,677
Short-term note receivable		—		2,384
Deferred tax assets		10,633		18,615
Total current assets		155,933		276,720
PROPERTY, PLANT AND EQUIPMENT, net of accumulated depreciation of $63,368 and $59,673 on June 30, 2008 and December 31, 2007, respectively		39,138		42,291
GOODWILL		32,656		32,743
OTHER INTANGIBLES AND OTHER ASSETS, net		43,284		39,086
TOTAL ASSETS	$	271,011	$	390,840
LIABILITIES AND STOCKHOLDERS’ EQUITY
CURRENT LIABILITIES:
Trade payables	$	35,232	$	43,993
Accrued liabilities		38,095		37,318
Short-term borrowings		397		79,000
Income taxes payable		311		283
Customer deposits		2,402		2,925
Liabilities of discontinued operations		—		15,867
Total current liabilities		76,437		179,386
NON-CURRENT LIABILITIES		4,857		6,919
NON-CURRENT DEFERRED TAX LIABILITIES		3,578		5,123
LONG-TERM TAXES PAYABLE		3,621		2,958
COMMITMENTS AND CONTINGENCIES
STOCKHOLDERS’ EQUITY:
Common stock – no par value, 75,000 shares authorized, 31,232 and 31,557 shares issued and outstanding at June 30, 2008 and December 31, 2007, respectively		4,158		4,346
Retained earnings		169,784		185,021
Accumulated other comprehensive income		8,576		7,087
Total stockholders’ equity		182,518		196,454
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY	$	271,011	$	390,840

NAUTILUS, INC.

CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited, in thousands, except per share amounts)

	Three Months Ended June 30,						Six Months Ended June 30,
	2008			2007			2008			2007
NET SALES	$	95,564		$	102,534		$	225,165		$	239,507
COST OF SALES		61,630			64,305			135,306			138,763
Gross profit		33,934			38,229			89,859			100,744
OPERATING EXPENSES:
Selling and marketing		31,484			40,854			73,714			88,416
General and administrative		14,896			11,476			34,706			22,886
Research and development		1,961			2,638			4,166			5,426
Litigation settlement		—			(18,300	)		—			(18,300	)
Total operating expenses		48,341			36,668			112,586			98,428
OPERATING INCOME (LOSS)		(14,407	)		1,561			(22,727	)		2,316
OTHER INCOME (EXPENSE):
Interest income		11			83			90			153
Interest expense		(93	)		(871	)		(1,330	)		(1,751	)
Other income, net		132			429			175			524
Total other income (expense)		50			(359	)		(1,065	)		(1,074	)
INCOME (LOSS) FROM CONTINUING OPERATIONS BEFORE INCOME TAXES		(14,357	)		1,202			(23,792	)		1,242
INCOME TAX EXPENSE (BENEFIT)		(4,722	)		531			(7,276	)		597
INCOME (LOSS) FROM CONTINUING OPERATIONS		(9,635	)		671			(16,516	)		645
DISCONTINUED OPERATIONS:
Income from discontinued operations		640			700			3,016			4,680
Income tax expense (benefit) from discontinued operations		(118	)		261			1,737			1,753
INCOME FROM DISCONTINUED OPERATIONS, net of tax		758			439			1,279			2,927
NET INCOME (LOSS)	$	(8,877	)	$	1,110		$	(15,237	)	$	3,572
EARNINGS (LOSS) PER SHARE FROM CONTINUING OPERATIONS:
BASIC	$	(0.30	)	$	0.02		$	(0.52	)	$	0.02
DILUTED	$	(0.30	)	$	0.02		$	(0.52	)	$	0.02
EARNINGS PER SHARE FROM DISCONTINUED OPERATIONS:
BASIC	$	0.02		$	0.02		$	0.04		$	0.09
DILUTED	$	0.02		$	0.02		$	0.04		$	0.09
EARNINGS (LOSS) PER SHARE:
BASIC	$	(0.28	)	$	0.04		$	(0.48	)	$	0.11
DILUTED	$	(0.28	)	$	0.04		$	(0.48	)	$	0.11
WEIGHTED AVERAGE SHARES OUTSTANDING:
BASIC		31,582			31,545			31,569			31,527
DILUTED		31,582			31,685			31,569			31,707

NAUTILUS, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited, in thousands)

	Six Months Ended June 30,
	2008			2007
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income (loss)	$	(15,237	)	$	3,572
Income from discontinued operations		1,279			2,927
Income (loss) from continuing operations		(16,516	)		645
Adjustments to reconcile income (loss) from continuing operations to net cash provided by operating activities
Depreciation and amortization		7,662			6,872
Share-based compensation expense		2,006			1,391
Gain on sale of property, plant and equipment		(173	)		(22	)
Excess tax benefit from exercise of employee stock options		—			(77	)
Deferred income taxes		5,849			(1,274	)
Litigation settlement		—			(18,300	)
Foreign currency transaction gain		(315	)		(363	)
Changes in assets and liabilities:
Trade receivables		35,751			60,903
Inventories		(2,273	)		(15,316	)
Prepaid expenses and other current assets		2,062			4,547
Other assets		(908	)		—
Income taxes receivable		(4,140	)		—
Trade payables		(8,967	)		(20,273	)
Income taxes payable		712			(2,640	)
Accrued liabilities		(2,127	)		(5,223	)
Customer deposits		(561	)		63
Net cash provided by operating activities of continuing operations		18,062			10,933
Net cash provided by (used in) operating activities of discontinued operations		(1,617	)		722
Net cash provided by operating activities		16,445			11,655
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of property, plant and equipment		(2,402	)		(4,585	)
Proceeds from sale of property, plant and equipment		141			32
Refund of acquisition escrow deposit		5,000			—
Net increase in other intangibles and other assets		(285	)		(484	)
Proceeds from sale of Pearl Izumi		58,435			—
Net (increase) decrease in short-term note receivable		2,384			(133	)
Net cash provided by (used in) investing activities from continuing operations		63,273			(5,170	)
Net cash used in investing activities from discontinued operations		(24	)		(377	)
Net cash provided by (used in) investing activities		63,249			(5,547	)

(continued)

NAUTILUS, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited, in thousands)

	Six Months Ended June 30,
	2008			2007
CASH FLOWS FROM FINANCING ACTIVITIES:
Cash dividends paid on common stock		—			(6,311	)
Proceeds from exercise of stock options		563			756
Excess tax benefit from exercise of employee stock options		—			77
Net (reduction) increase in short-term borrowings		(78,603	)		600
Stock repurchases		(2,209	)		—
Net cash used in financing activities from continuing operations		(80,249	)		(4,878	)
Net cash used in financing activities from discontinued operations		(174	)		(142	)
Net cash used in financing activities		(80,423	)		(5,020	)
Net effect of foreign currency exchange rate changes		(2,749	)		500
Net (decrease) increase in cash and cash equivalents		(3,478	)		1,588
Cash and cash equivalents, beginning of period		7,911			4,262
Cash and cash equivalents, end of period	$	4,433		$	5,850
Supplemental disclosures:
Cash paid for interest	$	2,342		$	1,666
Cash refunded (paid) for income taxes	$	8,812		$	(6,973	)
SUPPLEMENTAL DISCLOSURE OF OTHER NONCASH INVESTING AND FINANCING ACTIVITIES:
Accrued and noncurrent liabilities incurred for software purchase	$	1,021			—
Escrow deposit included in other assets for sale of Pearl Izumi	$	4,365			—

NAUTILUS, INC.

NET SALES BY BUSINESS UNIT

(Unaudited, in thousands)

	Six Months Ended
	June 30, 2008		June 30, 2007		$ Change			% Change
Direct	$	110,943	$	128,333	$	(17,390	)	-13.6	%
Retail		51,822		46,913		4,909		10.5	%
Commercial		60,440		62,931		(2,491	)	-4.0	%
Royalties		1,960		1,330		630		47.4	%
Total Revenue	$	225,165	$	239,507	$	(14,342	)	-6.0	%
	Three Months Ended
	June 30, 2008		June 30, 2007		$ Change			% Change
Direct	$	41,317	$	54,191	$	(12,874	)	-23.8	%
Retail		22,872		14,986		7,886		52.6	%
Commercial		30,466		32,751		(2,285	)	-7.0	%
Royalties		909		606		303		50.0	%
Total Revenue	$	95,564	$	102,534	$	(6,970	)	-6.8	%
	Three Months Ended
	Mar 31, 2008		Mar 31, 2007		$ Change			% Change
Direct	$	69,626	$	74,142	$	(4,516	)	-6.1	%
Retail		28,950		31,927		(2,977	)	-9.3	%
Commercial		29,974		30,180		(206	)	-0.7	%
Royalties		1,051		724		327		45.2	%
Total Revenue	$	129,601	$	136,973	$	(7,372	)	-5.4	%