PHLI PacificHealth Laboratories Inc (CE)

PacificHealth Laboratories, Inc. (OTCQB: PHLI) (OTCBB: PHLI), a leading sports nutrition company, today reported its financial results for the quarter and nine months ended September 30, 2012.

Third Quarter & Nine Months 2012 vs. 2011 Financial Results

Revenues were $1,721,119 for the third quarter and $5,701,292 for the nine months ended September 30, 2012 compared to $1,971,624 and $5,948,461, respectively, for the same periods in 2011. Net loss for the third quarter of 2012 was ($345,439), or ($0.02) per share, and net loss was ($454,965), or ($0.02) per share, for the nine months ended September 30, 2012 compared to a net loss of ($116,675), or ($0.01) per share for the third quarter of 2011 and net income of $2,324, or $0.00 per diluted share, for the nine months ended September 30, 2011. Gross margins decreased primarily as a result of across the board raw material price increases, most notably higher protein costs. General and administrative expenses increased $37,842 in the third quarter and increased $161,865 for the nine months ended September 30, 2012 compared to the same periods in 2011 primarily as a result of the Company's investment in internet and social marketing expenses in 2012 of approximately $49,000 for the quarter and $206,000 for the first nine months.

At September 30, 2012, the Company had cash, cash equivalents, and other short-term investments of $324,477 compared to $820,904 at December 31, 2011. Current assets exceeded current liabilities by approximately $676,000 at September 30, 2012.

Fred Duffner, President and CEO of PacificHealth Laboratories, said, "The biggest impact to revenue in the third quarter was the transitioning from our old formula ACCELERADE and ENDUROX R4 to our new all-natural formulas. Our largest bicycle customer that transitioned over to all-natural in June had to manage through the sell-through of the old formula in the third quarter which negatively impacted purchases from us. In addition, we invested in markdown monies in support of the sell-through of the old formula with them and other major customers. This coupled with the reduction in inventory purchases by our nutritional channel customers has impacted our year to date revenues."

Mr. Duffner added, "We have completed the transition over to new all-natural formulas and new labeling in the marketplace as one of our key initiatives for 2012. We brought the management of our social and web-based marketing in-house as of the end of the third quarter which should reduce our G & A expenses moving forward. We also launched Body Glove Surge in August into Southern California as another of our key initiatives for 2012."

Mr. Duffner concluded, "Although revenue results are below expectations we have completed the key initiatives to support our base business and launched Body Glove Surge which we believe provides us the opportunity to expand PHLI beyond its current channels and into broader distribution moving forward into 2013."

About PacificHealth Laboratories, Inc.

PacificHealth Laboratories, Inc. (OTCQB: PHLI) (OTCBB: PHLI), founded in 1996 by two prominent scientists, started with a singular purpose -- to help athletes achieve their personal goals. We never lost sight of that mission. Collaborating with some of the world's top nutritionists, biochemists and sports scientists, our research and products have reshaped sports nutrition. Our discoveries help muscles work stronger, faster and longer and are an integral part of the daily training and race regimens of athletes at all levels. However, we are most proud of the simple fact that our products "power your passion." To learn more, visit www.pacifichealthlabs.com.

Notice: This news release and oral statements made from time to time by Company representatives concerning the same subject matter may contain so-called "forward-looking statements". These statements can be identified by introductory words such as "expects," "plans," "will," "estimates," "forecasts," "projects," or words of similar meaning and by the fact they do not relate strictly to historical or current facts. Forward-looking statements frequently are used in discussing new products and their potential. Many factors may cause actual results to differ from forward-looking statements, including inaccurate assumptions and a broad variety of risks and uncertainties, some of which are known, such general economic conditions, consumer product acceptance and competitive products, and others of which are not. No forward-looking statements are a guarantee of future results or events, and one should avoid placing undue reliance on such statements.

SELECTED FINANCIAL DATA:

                      PACIFICHEALTH LABORATORIES, INC.
                          STATEMENTS OF OPERATIONS
      FOR THE THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2012 AND 2011
                                (UNAUDITED)

                               Three Months               Nine Months
                            Ended September 30,       Ended September 30,
                             2012         2011         2012         2011
                         -----------  -----------  -----------  -----------

Revenues:
  Net product sales      $ 1,721,119  $ 1,971,624  $ 5,701,292  $ 5,948,461

Cost of goods sold         1,136,016    1,120,865    3,505,914    3,332,367
                         -----------  -----------  -----------  -----------

Gross profit                 585,103      850,759    2,195,378    2,616,094
                         -----------  -----------  -----------  -----------

Operating expenses:
  Sales and marketing        339,098      414,453      842,523      983,496
  General and
   administrative
   (Includes related
   party consulting of
   $48,189, $48,000,
   $146,809, $139,000,
   respectively)             567,427      529,585    1,739,924    1,578,059
  Research and
   development                16,458       16,141       51,945       40,936
                         -----------  -----------  -----------  -----------

                             922,983      960,179    2,634,392    2,602,491
                         -----------  -----------  -----------  -----------

(Loss) income before
 other expense
 andprovision for income
 taxes                      (337,880)    (109,420)    (439,014)      13,603
                         -----------  -----------  -----------  -----------

Other (expense) income:
  Other income                     -            -            -        2,100
  Interest income                125          112          359          391
  Interest expense            (7,684)      (7,367)     (16,310)     (13,770)
                         -----------  -----------  -----------  -----------
                              (7,559)      (7,255)     (15,951)     (11,279)
                         -----------  -----------  -----------  -----------

(Loss) income before
 provision for income
 taxes                      (345,439)    (116,675)    (454,965)       2,324

Provision for income
 taxes                             -            -            -            -
                         -----------  -----------  -----------  -----------

Net (loss) income        $  (345,439) $  (116,675) $  (454,965) $     2,324
                         ===========  ===========  ===========  ===========

Basic (loss) income per
 share                   $     (0.02) $     (0.01) $     (0.02) $      0.00
                         ===========  ===========  ===========  ===========

Diluted (loss) income per
 share                   $     (0.00) $     (0.00) $     (0.00) $      0.00
                         ===========  ===========  ===========  ===========

Weighted average common
 shares - basic           20,871,772   20,865,257   20,871,772   19,100,056
                         ===========  ===========  ===========  ===========

Weighted average common
 shares - diluted         20,871,772   20,865,257   20,871,772   19,330,073
                         ===========  ===========  ===========  ===========


                      PACIFICHEALTH LABORATORIES, INC.
                               BALANCE SHEETS
                                (UNAUDITED)

                                   ASSETS
                                               September 30,   December 31,
                                                    2012           2011
                                               -------------  -------------
Current assets:
  Cash and cash equivalents                    $     274,477  $     745,904
  Other short-term investments                        50,000         75,000
  Accounts receivable, net                           676,572        369,376
  Inventories, net                                   746,104        571,403
  Prepaid expenses                                    93,968         91,479
                                               -------------  -------------
    Total current assets                           1,841,121      1,853,162

Property and equipment, net                          140,182         26,729

Deposits                                              10,895         10,895
                                               -------------  -------------

      Total assets                             $   1,992,198  $   1,890,786
                                               =============  =============

                    LIABILITIES AND STOCKHOLDERS' EQUITY

Current liabilities:
  Line of credit                               $      25,000  $      37,500
  Notes payable                                       29,864         19,679
  Accounts payable and accrued expenses
   (Includes relatedparty of $16,000 and
   $32,000, respectively)                          1,059,183        546,712
  Deferred revenue                                    51,024         56,170
                                               -------------  -------------
    Total current liabilities                      1,165,071        660,061
                                               -------------  -------------

Commitments

Stockholders' equity:
  Common stock, $.0025 par value; authorized
   50,000,000 shares; issued and outstanding:
   20,871,772 shares                                  52,179         52,179
  Additional paid-in capital                      21,364,686     21,313,319
  Accumulated deficit                            (20,589,738)   (20,134,773)
                                               -------------  -------------

                                                     827,127      1,230,725
                                               -------------  -------------

      Total liabilities and stockholders'
       equity                                  $   1,992,198  $   1,890,786
                                               =============  =============

Contact: Stephen Kuchen CFO 732-739-2900, x603 Email Contact