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Proc-Type: 2001,MIC-CLEAR
Originator-Name: webmaster@www.sec.gov
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<SEC-DOCUMENT>0000898430-03-002985.txt : 20030514
<SEC-HEADER>0000898430-03-002985.hdr.sgml : 20030514
<ACCEPTANCE-DATETIME>20030514172829
ACCESSION NUMBER:		0000898430-03-002985
CONFORMED SUBMISSION TYPE:	10-Q
PUBLIC DOCUMENT COUNT:		1
CONFORMED PERIOD OF REPORT:	20030331
FILED AS OF DATE:		20030514

FILER:

	COMPANY DATA:	
		COMPANY CONFORMED NAME:			NATURAL ALTERNATIVES INTERNATIONAL INC
		CENTRAL INDEX KEY:			0000787253
		STANDARD INDUSTRIAL CLASSIFICATION:	MEDICINAL CHEMICALS & BOTANICAL PRODUCTS [2833]
		IRS NUMBER:				841007839
		STATE OF INCORPORATION:			DE
		FISCAL YEAR END:			0630

	FILING VALUES:
		FORM TYPE:		10-Q
		SEC ACT:		1934 Act
		SEC FILE NUMBER:	000-15701
		FILM NUMBER:		03700327

	BUSINESS ADDRESS:	
		STREET 1:		1185 LINDA VISTA DR
		CITY:			SAN MARCOS
		STATE:			CA
		ZIP:			92069
		BUSINESS PHONE:		6197447340

	MAIL ADDRESS:	
		STREET 1:		1185 LINDA VISTA DRIVE
		CITY:			SAN MARCOS
		STATE:			CA
		ZIP:			92069

	FORMER COMPANY:	
		FORMER CONFORMED NAME:	AMERICAN ACQUISITIONS INC
		DATE OF NAME CHANGE:	19860929
</SEC-HEADER>
<DOCUMENT>
<TYPE>10-Q
<SEQUENCE>1
<FILENAME>d10q.htm
<DESCRIPTION>FORM 10-Q
<TEXT>
<HTML><HEAD>
<TITLE>Form 10-Q</TITLE>
</HEAD>
<BODY bgcolor="#FFFFFF">
  <hr size="3" width="100%" color="black" noshade> <p align="center"><font style="font-size:18pt"><b>UNITED STATES SECURITIES AND EXCHANGE COMMISSION</b></font><font style="font-size:12pt"><br><b>Washington, D.C.
20549</b></font></p> <hr size="1" width="17%" color="black" noshade> <p align="center"><font style="font-size:18pt"><b>FORM 10-Q</b></font></p> <p align="center"><font style="font-size:12pt"><b>QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934</b></font></p> <p align="center"><font style="font-size:10pt"><b>For the quarterly period ended March 31, 2003</b></font></p> <p align="center"><font style="font-size:10pt"><b>Commission file number
0-15701</b></font></p> <hr size="1" width="17%" color="black" noshade> <p align="center"><font style="font-size:20pt"><b>NATURAL ALTERNATIVES INTERNATIONAL, INC.</b></font><font style="font-size:10pt"><br></font><font style="font-size:8pt"><b>(Exact
name of registrant as specified in its charter)</b></font></p>
<table border="0" cellspacing="0" width="100%">
<tr>
<td width="30%" align="center" valign="top"><font style="font-size:10pt"></font></td>
<td width="40%" align="center" valign="top"><font style="font-size:10pt"></font></td>
<td width="30%" align="center" valign="top"><font style="font-size:10pt"></font></td> </tr>
<tr>
<td align="center" valign="top"><font style="font-size:10pt"><b>Delaware</b></font></td>
<td valign="top"><font style="font-size:10pt">&nbsp;</font></td>
<td align="center" valign="top"><font style="font-size:10pt"><b>84-1007839</b></font></td> </tr>
<tr>
<td align="center" valign="top"><font style="font-size:8pt"><b>(State or other jurisdiction of incorporation<br> or organization)</b></font></td>
<td valign="top"><font style="font-size:10pt">&nbsp;</font></td>
<td align="center" valign="top"><font style="font-size:8pt"><b>(I.R.S. Employer Identification No.)</b></font></td> </tr>
<tr>
<td valign="top"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="top"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="top"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr>
<td align="center" valign="top"><font style="font-size:10pt"><b>1185 Linda Vista Drive<br>San Marcos, California 92069</b></font></td>
<td valign="top"><font style="font-size:10pt">&nbsp;</font></td>
<td align="center" valign="top"><font style="font-size:10pt"><b>(760) 744-7340</b></font></td> </tr>
<tr>
<td align="center" valign="top"><font style="font-size:8pt"><b>(Address of principal executive offices,<br>including zip code)</b></font></td>
<td valign="top"><font style="font-size:10pt">&nbsp;</font></td>
<td align="center" valign="top"><font style="font-size:8pt"><b>(Registrant&#146;s telephone number,<br>including area code)</b></font></td> </tr> </table> <hr size="1" width="17%" color="black" noshade> <p><font style="font-size:10pt">Indicate by
check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such
reports), and (2) has been subject to such filing requirements for the past 90 days.</font></p> <p align="center"><font style="font-size:10pt">Yes&nbsp;&nbsp;</font><font face="wingdings" style="font-size:10pt">x</font><font
style="font-size:10pt">&nbsp;&nbsp;&nbsp;&nbsp;No&nbsp;&nbsp;</font><font face="wingdings" style="font-size:10pt">o</font></p> <p><font style="font-size:10pt">At May 13, 2003, the registrant had 5,815,132 outstanding shares of common stock, $.01 par
value, net of 272,400 treasury shares.</font></p> <hr size="3" width="100%" color="black" noshade>

<p Style='page-break-before:always'>
<HR  SIZE="3" COLOR="#999999" WIDTH="100%" ALIGN="CENTER">
  <p><font style="font-size:10pt"><b>Part I.&nbsp;&nbsp;Financial Information<br> Item 1.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Financial Statements</b></font></p> <p align="center"><font style="font-size:10pt"><b>Natural
Alternatives International, Inc.</b><br><b>Consolidated Balance Sheets</b><br><b>(Dollars in thousands, except share data)</b></font></p>
<table border="0" cellspacing="0" width="100%">
<tr>
<td width="2%" align="center" valign="bottom"><font style="font-size:10pt"></font></td>
<td width="2%" align="center" valign="bottom"><font style="font-size:10pt"></font></td>
<td width="77%" align="center" valign="bottom"><font style="font-size:10pt"></font></td>
<td width="1%" valign="bottom"><font style="font-size:10pt"></font></td>
<td width="6%" align="right" valign="bottom"><font style="font-size:10pt"></font></td>
<td width="1%" valign="bottom"><font style="font-size:10pt"></font></td>
<td width="3%" align="center" valign="bottom"><font style="font-size:10pt"></font></td>
<td width="1%" valign="bottom"><font style="font-size:10pt"></font></td>
<td width="6%" align="right" valign="bottom"><font style="font-size:10pt"></font></td>
<td width="1%" align="center" valign="bottom"><font style="font-size:10pt"></font></td> </tr>
<tr>
<td align="center" valign="bottom"><font style="font-size:8pt"><b>&nbsp;</b></font></td>
<td align="center" valign="bottom"><font style="font-size:8pt"><b>&nbsp;</b></font></td>
<td align="center" valign="bottom"><font style="font-size:8pt"><b>&nbsp;</b></font></td>
<td align="center" valign="bottom" colspan="2"><font style="font-size:8pt"><b>&nbsp;</b></font><font style="font-size:8pt"><b>March 31,<br> 2003</b></font></td>
<td align="center" valign="bottom"><font style="font-size:8pt"><b>&nbsp;</b></font></td>
<td align="center" valign="bottom"><font style="font-size:8pt"><b>&nbsp;</b></font></td>
<td align="center" valign="bottom" colspan="2"><font style="font-size:8pt"><b>&nbsp;</b></font><font style="font-size:8pt"><b>June 30,<br> 2002</b></font></td>
<td align="center" valign="bottom"><font style="font-size:8pt"><b>&nbsp;</b></font></td> </tr>
<tr>
<td align="center" valign="bottom"><font style="font-size:8pt"><b>&nbsp;</b></font></td>
<td align="center" valign="bottom"><font style="font-size:8pt"><b>&nbsp;</b></font></td>
<td align="center" valign="bottom"><font style="font-size:8pt"><b>&nbsp;</b></font></td>
<td align="center" valign="bottom" colspan="2"><hr size="1" width="100%" color="black" noshade></td>
<td align="center" valign="bottom"><font style="font-size:8pt"><b>&nbsp;</b></font></td>
<td align="center" valign="bottom"><font style="font-size:8pt"><b>&nbsp;</b></font></td>
<td align="center" valign="bottom" colspan="2"><hr size="1" width="100%" color="black" noshade></td>
<td align="center" valign="bottom"><font style="font-size:8pt"><b></b></font></td> </tr>
<tr>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="center" valign="bottom" colspan="2"><font style="font-size:8pt">(Unaudited)</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr bgcolor="#cceeff">
<td valign="bottom" colspan="3"><font style="font-size:10pt"><b>Assets</b></font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr>
<td valign="bottom" colspan="3"><font style="font-size:10pt">Current assets:</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr bgcolor="#cceeff">
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom" colspan="2"><font style="font-size:10pt">Cash and cash equivalents</font></td>
<td valign="bottom"><font style="font-size:10pt">$</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">4,218</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">$</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">640</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom" colspan="2"><font style="font-size:10pt">Restricted cash</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">&#151;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">1,500</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr bgcolor="#cceeff">
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom" colspan="2"><font style="font-size:10pt">Accounts receivable, net of allowance for doubtful accounts of <br> &nbsp;&nbsp;&nbsp; $32 at March 31, 2003 and $105 at June 30, 2002</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">4,508</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">3,536</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom" colspan="2"><font style="font-size:10pt">Inventories, net</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">8,474</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">7,871</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr bgcolor="#cceeff">
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom" colspan="2"><font style="font-size:10pt">Income tax refund receivable</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">&#151;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">701</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom" colspan="2"><font style="font-size:10pt">Prepaid expenses</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">864</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">271</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr bgcolor="#cceeff">
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom" colspan="2"><font style="font-size:10pt">Deposits</font><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">244</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">168</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom" colspan="2"><font style="font-size:10pt">Other current assets</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">82</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">165</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"> <hr size="1" width="100%" color="black" noshade> </td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"> <hr size="1" width="100%" color="black" noshade> </td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr bgcolor="#cceeff">
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">Total current assets</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">18,390</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">14,852</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"> <hr size="1" width="100%" color="black" noshade> </td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"> <hr size="1" width="100%" color="black" noshade> </td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr bgcolor="#cceeff">
<td valign="bottom" colspan="3"><font style="font-size:10pt">Property and equipment, net</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">11,248</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">12,439</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"> <hr size="1" width="100%" color="black" noshade> </td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"> <hr size="1" width="100%" color="black" noshade> </td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr bgcolor="#cceeff">
<td valign="bottom" colspan="3"><font style="font-size:10pt">Other assets:</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom" colspan="2"><font style="font-size:10pt">Related parties notes receivable</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">47</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">118</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr bgcolor="#cceeff">
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom" colspan="2"><font style="font-size:10pt">Other, net</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">127</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">101</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"> <hr size="1" width="100%" color="black" noshade> </td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"> <hr size="1" width="100%" color="black" noshade> </td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr bgcolor="#cceeff">
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">Total other assets</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">174</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">219</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"> <hr size="1" width="100%" color="black" noshade> </td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"> <hr size="1" width="100%" color="black" noshade> </td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr bgcolor="#cceeff">
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">Total assets</font></td>
<td valign="bottom"><font style="font-size:10pt">$</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">29,812</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">$</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">27,510</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"> <hr size="3" width="100%" color="black" noshade> </td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"> <hr size="3" width="100%" color="black" noshade> </td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr bgcolor="#cceeff">
<td valign="bottom" colspan="3"><font style="font-size:10pt"><b>Liabilities and Stockholders&#146; Equity</b></font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr>
<td valign="bottom" colspan="3"><font style="font-size:10pt">Current liabilities:</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr bgcolor="#cceeff">
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom" colspan="2"><font style="font-size:10pt">Accounts payable </font></td>
<td valign="bottom"><font style="font-size:10pt">$</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">4,098</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">$</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">4,112</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom" colspan="2"><font style="font-size:10pt">Accrued liabilities</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">1,101</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">815</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr bgcolor="#cceeff">
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom" colspan="2"><font style="font-size:10pt">Accrued compensation and employee benefits</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">676</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">482</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom" colspan="2"><font style="font-size:10pt">Income taxes payable</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">152</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">131</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr bgcolor="#cceeff">
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom" colspan="2"><font style="font-size:10pt">Current portion of long-term debt </font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">569</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">587</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"> <hr size="1" width="100%" color="black" noshade> </td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"> <hr size="1" width="100%" color="black" noshade> </td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr bgcolor="#cceeff">
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">Total current liabilities</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">6,596</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">6,127</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr>
<td valign="bottom" colspan="3"><font style="font-size:10pt">Long-term debt, less current portion</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">2,529</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">1,576</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr bgcolor="#cceeff">
<td valign="bottom" colspan="3"><font style="font-size:10pt">Long-term pension liability</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">135</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">199</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"> <hr size="1" width="100%" color="black" noshade> </td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"> <hr size="1" width="100%" color="black" noshade> </td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr bgcolor="#cceeff">
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">Total liabilities</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">9,260</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">7,902</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"> <hr size="1" width="100%" color="black" noshade> </td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"> <hr size="1" width="100%" color="black" noshade> </td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr bgcolor="#cceeff">
<td valign="bottom" colspan="3"><font style="font-size:10pt">Commitments and contingencies</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr>
<td valign="bottom" colspan="3"><font style="font-size:10pt">Stockholders&#146; equity:</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr bgcolor="#cceeff">
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom" colspan="2"><font style="font-size:10pt">Preferred stock; $.01 par value; 500,000 shares authorized; none issued or outstanding</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">&#151;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">&#151;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom" colspan="2"> <div style="MARGIN-LEFT:20PX; TEXT-INDENT:-20PX"> <font style="font-size:10pt">Common stock; $.01 par value; 8,000,000 shares authorized; issued and outstanding 6,087,532 shares at March 31, 2003 and 6,073,179 shares
at June 30, 2002</font></div> </td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">61</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">61</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr bgcolor="#cceeff">
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom" colspan="2"><font style="font-size:10pt">Additional paid-in capital</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">11,448</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">11,362</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom" colspan="2"><font style="font-size:10pt">Retained earnings</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">10,346</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">9,488</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr bgcolor="#cceeff">
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom" colspan="2"><font style="font-size:10pt">Treasury stock, at cost, 272,400 shares at March 31, 2003 and June 30, 2002</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">(1,303</font></td>
<td valign="bottom"><font style="font-size:10pt">)</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">(1,303</font></td>
<td valign="bottom"><font style="font-size:10pt">)</font></td> </tr>
<tr>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"> <hr size="1" width="100%" color="black" noshade> </td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"> <hr size="1" width="100%" color="black" noshade> </td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr bgcolor="#cceeff">
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">Total stockholders&#146; equity</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">20,552</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">19,608</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"> <hr size="1" width="100%" color="black" noshade> </td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"> <hr size="1" width="100%" color="black" noshade> </td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr bgcolor="#cceeff">
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">Total liabilities and stockholders&#146; equity</font></td>
<td valign="bottom"><font style="font-size:10pt">$</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">29,812</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">$</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">27,510</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"> <hr size="3" width="100%" color="black" noshade> </td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"> <hr size="3" width="100%" color="black" noshade> </td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr> </table> <p align="center"><font style="font-size:10pt"><i>See accompanying notes to consolidated condensed financial statements.</i></font></p> <p align="center"><font
style="font-size:10pt">2</font></p>

<p Style='page-break-before:always'>
<HR  SIZE="3" COLOR="#999999" WIDTH="100%" ALIGN="CENTER">
  <p align="center"><font style="font-size:10pt"><b>Natural Alternatives International, Inc.<br> Consolidated Statements of Operations and Comprehensive Income<br> (Dollars in thousands, except per share
data)<br>(Unaudited)</b></font></p>
<table border="0" cellspacing="0" width="100%">
<tr>
<td width="2%" align="center" valign="bottom"><font style="font-size:10pt"></font></td>
<td width="57%" valign="bottom"><font style="font-size:10pt"></font></td>
<td width="1%" valign="bottom"><font style="font-size:10pt"></font></td>
<td width="6%" align="right" valign="bottom"><font style="font-size:10pt"></font></td>
<td width="1%" valign="bottom"><font style="font-size:10pt"></font></td>
<td width="3%" valign="bottom"><font style="font-size:10pt"></font></td>
<td width="1%" valign="bottom"><font style="font-size:10pt"></font></td>
<td width="6%" align="right" valign="bottom"><font style="font-size:10pt"></font></td>
<td width="1%" valign="bottom"><font style="font-size:10pt"></font></td>
<td width="3%" valign="bottom"><font style="font-size:10pt"></font></td>
<td width="1%" valign="bottom"><font style="font-size:10pt"></font></td>
<td width="6%" align="right" valign="bottom"><font style="font-size:10pt"></font></td>
<td width="1%" valign="bottom"><font style="font-size:10pt"></font></td>
<td width="3%" valign="bottom"><font style="font-size:10pt"></font></td>
<td width="1%" valign="bottom"><font style="font-size:10pt"></font></td>
<td width="6%" align="right" valign="bottom"><font style="font-size:10pt"></font></td>
<td width="1%" align="center" valign="bottom"><font style="font-size:10pt"></font><font style="font-size:10pt"><b></b></font></td> </tr>
<tr>
<td align="center" valign="bottom"><font style="font-size:8pt"><b>&nbsp;</b></font></td>
<td align="center" valign="bottom"><font style="font-size:8pt"><b>&nbsp;</b></font></td>
<td align="center" valign="bottom" colspan="6"><font style="font-size:8pt"><b>Three months ended<br>March 31,</b></font></td>
<td align="center" valign="bottom"><font style="font-size:8pt"><b>&nbsp;</b></font></td>
<td align="center" valign="bottom"><font style="font-size:8pt"><b>&nbsp;</b></font></td>
<td align="center" valign="bottom" colspan="6"><font style="font-size:8pt"><b>Nine months ended<br>March 31,</b></font></td>
<td align="center" valign="bottom"><font style="font-size:8pt"><b>&nbsp;</b></font></td> </tr>
<tr>
<td align="center" valign="bottom"><font style="font-size:8pt"><b>&nbsp;</b></font></td>
<td align="center" valign="bottom"><font style="font-size:8pt"><b>&nbsp;</b></font></td>
<td align="center" valign="bottom" colspan="6"><hr size="1" width="100%" color="black" noshade></td>
<td align="center" valign="bottom"><font style="font-size:8pt"><b>&nbsp;</b></font></td>
<td align="center" valign="bottom"><font style="font-size:8pt"><b>&nbsp;</b></font></td>
<td align="center" valign="bottom" colspan="6"><hr size="1" width="100%" color="black" noshade></td>
<td align="center" valign="bottom"><font style="font-size:8pt"><b>&nbsp;</b></font></td> </tr>
<tr>
<td align="center" valign="bottom"><font style="font-size:8pt"><b>&nbsp;</b></font></td>
<td align="center" valign="bottom"><font style="font-size:8pt"><b>&nbsp;</b></font></td>
<td align="center" valign="bottom" colspan="2"><font style="font-size:8pt"><b>2003</b></font></td>
<td align="center" valign="bottom"><font style="font-size:8pt"><b>&nbsp;</b></font></td>
<td align="center" valign="bottom"><font style="font-size:8pt"><b>&nbsp;</b></font></td>
<td align="center" valign="bottom" colspan="2"><font style="font-size:8pt"><b>2002</b></font></td>
<td align="center" valign="bottom"><font style="font-size:8pt"><b>&nbsp;</b></font></td>
<td align="center" valign="bottom"><font style="font-size:8pt"><b>&nbsp;</b></font></td>
<td align="center" valign="bottom" colspan="2"><font style="font-size:8pt"><b>2003</b></font></td>
<td align="center" valign="bottom"><font style="font-size:8pt"><b>&nbsp;</b></font></td>
<td align="center" valign="bottom"><font style="font-size:8pt"><b>&nbsp;</b></font></td>
<td align="center" valign="bottom" colspan="2"><font style="font-size:8pt"><b>2002</b></font></td>
<td align="center" valign="bottom"><font style="font-size:8pt"><b>&nbsp;</b></font></td> </tr>
<tr>
<td align="center" valign="bottom"><font style="font-size:8pt"><b>&nbsp;</b></font></td>
<td align="center" valign="bottom"><font style="font-size:8pt"><b>&nbsp;</b></font></td>
<td align="center" valign="bottom" colspan="2"><hr size="1" width="100%" color="black" noshade></td>
<td align="center" valign="bottom"><font style="font-size:8pt"><b>&nbsp;</b></font></td>
<td align="center" valign="bottom"><font style="font-size:8pt"><b>&nbsp;</b></font></td>
<td align="center" valign="bottom" colspan="2"><hr size="1" width="100%" color="black" noshade></td>
<td align="center" valign="bottom"><font style="font-size:8pt"><b>&nbsp;</b></font></td>
<td align="center" valign="bottom"><font style="font-size:8pt"><b>&nbsp;</b></font></td>
<td align="center" valign="bottom" colspan="2"><hr size="1" width="100%" color="black" noshade></td>
<td align="center" valign="bottom"><font style="font-size:8pt"><b>&nbsp;</b></font></td>
<td align="center" valign="bottom"><font style="font-size:8pt"><b>&nbsp;</b></font></td>
<td align="center" valign="bottom" colspan="2"><hr size="1" width="100%" color="black" noshade></td>
<td align="center"valign="bottom"><font style="font-size:8pt"><b></b></font></td> </tr>
<tr bgcolor="#cceeff">
<td valign="bottom" colspan="2"><font style="font-size:10pt">Net sales</font></td>
<td valign="bottom"><font style="font-size:10pt">$</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">13,755</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">$</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">12,843</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">$</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">39,901</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">$</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">35,385</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr>
<td valign="bottom" colspan="2"><font style="font-size:10pt">Cost of goods sold</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">10,468</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">9,956</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">30,367</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">27,768</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr>
<td valign="bottom" colspan="2"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"> <hr size="1" width="100%" color="black" noshade> </td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"> <hr size="1" width="100%" color="black" noshade> </td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"> <hr size="1" width="100%" color="black" noshade> </td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"> <hr size="1" width="100%" color="black" noshade> </td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr bgcolor="#cceeff">
<td valign="bottom" colspan="2"><font style="font-size:10pt">Gross profit</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">3,287</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">2,887</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">9,534</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">7,617</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr>
<td valign="bottom" colspan="2"><font style="font-size:10pt">Selling, general &#38; administrative expenses</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">3,076</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">2,946</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">8,665</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">7,861</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"> <hr size="1" width="100%" color="black" noshade> </td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"> <hr size="1" width="100%" color="black" noshade> </td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"> <hr size="1" width="100%" color="black" noshade> </td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"> <hr size="1" width="100%" color="black" noshade> </td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr bgcolor="#cceeff">
<td valign="bottom" colspan="2"><font style="font-size:10pt">Income (loss) from operations</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">211</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">(59</font></td>
<td valign="bottom"><font style="font-size:10pt">)</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">869</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">(244</font></td>
<td valign="bottom"><font style="font-size:10pt">)</font></td> </tr>
<tr>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"> <hr size="1" width="100%" color="black" noshade> </td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"> <hr size="1" width="100%" color="black" noshade> </td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"> <hr size="1" width="100%" color="black" noshade> </td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"> <hr size="1" width="100%" color="black" noshade> </td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr>
<td valign="bottom" colspan="2"><font style="font-size:10pt">Other income (expense):</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr bgcolor="#cceeff">
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">Interest income</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">25</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">2</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">53</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">9</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">Interest expense</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">(56</font></td>
<td valign="bottom"><font style="font-size:10pt">)</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">(159</font></td>
<td valign="bottom"><font style="font-size:10pt">)</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">(208</font></td>
<td valign="bottom"><font style="font-size:10pt">)</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">(510</font></td>
<td valign="bottom"><font style="font-size:10pt">)</font></td> </tr>
<tr bgcolor="#cceeff">
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">Foreign exchange gain (loss)</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">13</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">(2</font></td>
<td valign="bottom"><font style="font-size:10pt">)</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">(4</font></td>
<td valign="bottom"><font style="font-size:10pt">)</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">(39</font></td>
<td valign="bottom"><font style="font-size:10pt">)</font></td> </tr>
<tr>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">Proceeds from vitamin antitrust litigation</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">&#151;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">1,000</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">225</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">1,000</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr bgcolor="#cceeff">
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">Other, net</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">(15</font></td>
<td valign="bottom"><font style="font-size:10pt">)</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">(2</font></td>
<td valign="bottom"><font style="font-size:10pt">)</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">(56</font></td>
<td valign="bottom"><font style="font-size:10pt">)</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">12</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"> <hr size="1" width="100%" color="black" noshade> </td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"> <hr size="1" width="100%" color="black" noshade> </td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"> <hr size="1" width="100%" color="black" noshade> </td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"> <hr size="1" width="100%" color="black" noshade> </td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr bgcolor="#cceeff">
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">(33</font></td>
<td valign="bottom"><font style="font-size:10pt">)</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">839</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">10</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">472</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"> <hr size="1" width="100%" color="black" noshade> </td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"> <hr size="1" width="100%" color="black" noshade> </td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"> <hr size="1" width="100%" color="black" noshade> </td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"> <hr size="1" width="100%" color="black" noshade> </td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr bgcolor="#cceeff">
<td valign="bottom" colspan="2"><font style="font-size:10pt">Income before income taxes</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">178</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">780</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">879</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">228</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr>
<td valign="bottom" colspan="2"><font style="font-size:10pt">Provision for income taxes</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">6</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">21</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">21</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">63</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"> <hr size="1" width="100%" color="black" noshade> </td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"> <hr size="1" width="100%" color="black" noshade> </td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"> <hr size="1" width="100%" color="black" noshade> </td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"> <hr size="1" width="100%" color="black" noshade> </td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr bgcolor="#cceeff">
<td valign="bottom" colspan="2"><font style="font-size:10pt">Net income </font></td>
<td valign="bottom"><font style="font-size:10pt">$</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">172</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">$</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">759</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">$</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">858</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">$</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">165</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"> <hr size="3" width="100%" color="black" noshade> </td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"> <hr size="3" width="100%" color="black" noshade> </td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"> <hr size="3" width="100%" color="black" noshade> </td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"> <hr size="3" width="100%" color="black" noshade> </td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr bgcolor="#cceeff">
<td valign="bottom" colspan="2"><font style="font-size:10pt">Net income per common share:</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">Basic</font></td>
<td valign="bottom"><font style="font-size:10pt">$</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt"> 0.03</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">$</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt"> 0.13 </font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">$</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">0.15</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">$</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">0.03</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"> <hr size="3" width="100%" color="black" noshade> </td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"> <hr size="3" width="100%" color="black" noshade> </td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"> <hr size="3" width="100%" color="black" noshade> </td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"> <hr size="3" width="100%" color="black" noshade> </td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr bgcolor="#cceeff">
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">Diluted</font></td>
<td valign="bottom"><font style="font-size:10pt">$</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt"> 0.03 </font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">$</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt"> 0.13</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">$</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">0.14</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">$</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">0.03</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"> <hr size="3" width="100%" color="black" noshade> </td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"> <hr size="3" width="100%" color="black" noshade> </td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"> <hr size="3" width="100%" color="black" noshade> </td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"> <hr size="3" width="100%" color="black" noshade> </td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr bgcolor="#cceeff">
<td valign="bottom" colspan="2"><font style="font-size:10pt">Weighted average common shares outstanding:</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">Basic shares</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">5,814,258</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">5,794,613</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">5,807,143</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">5,788,608</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr bgcolor="#cceeff">
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">Diluted shares</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">6,061,391</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">5,795,833</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">6,004,304</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">5,789,015</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr> </table> <p align="center"><font style="font-size:10pt"><i>See accompanying notes to consolidated condensed financial statements.</i></font></p> <p align="center"><font
style="font-size:10pt">3</font></p>

<p Style='page-break-before:always'>
<HR  SIZE="3" COLOR="#999999" WIDTH="100%" ALIGN="CENTER">
 <p align="center"><font style="font-size:10pt"><b>Natural Alternatives International, Inc.<br>Consolidated Statements of Cash Flows<br>(Dollars in thousands)<br>(Unaudited)</b></font></p>
<table border="0" cellspacing="0" width="100%">
<tr>
<td width="2%" align="center" valign="bottom"><font style="font-size:10pt"><b></b></font></td>
<td width="2%" valign="bottom"><font style="font-size:10pt"></font></td>
<td width="73%" valign="bottom"><font style="font-size:10pt"></font></td>
<td width="1%" valign="bottom"><font style="font-size:10pt"></font></td>
<td width="8%" align="right" valign="bottom"><font style="font-size:10pt"></font></td>
<td width="1%" valign="bottom"><font style="font-size:10pt"></font></td>
<td width="3%" align="center" valign="bottom"><font style="font-size:10pt"></font></td>
<td width="1%" valign="bottom"><font style="font-size:10pt"></font></td>
<td width="8%" align="right" valign="bottom"><font style="font-size:10pt"></font></td>
<td width="1%" align="center" valign="bottom"><font style="font-size:10pt"><b></b></font></td> </tr>
<tr>
<td align="center" valign="bottom"><font style="font-size:8pt"><b>&nbsp;</b></font></td>
<td align="center" valign="bottom"><font style="font-size:8pt"><b>&nbsp;</b></font></td>
<td align="center" valign="bottom"><font style="font-size:8pt"><b>&nbsp;</b></font></td>
<td align="center" valign="bottom" colspan="6"><font style="font-size:8pt"><b>Nine months ended March 31,</b></font></td>
<td align="center" valign="bottom"><font style="font-size:8pt"><b>&nbsp;</b></font></td> </tr>
<tr>
<td align="center" valign="bottom"><font style="font-size:8pt"><b>&nbsp;</b></font></td>
<td align="center" valign="bottom"><font style="font-size:8pt"><b>&nbsp;</b></font></td>
<td align="center" valign="bottom"><font style="font-size:8pt"><b>&nbsp;</b></font></td>
<td align="center" valign="bottom" colspan="6"><hr size="1" width="100%" color="black" noshade></td>
<td align="center" valign="bottom"><font style="font-size:8pt"><b>&nbsp;</b></font></td> </tr>
<tr>
<td align="center" valign="bottom"><font style="font-size:8pt"><b>&nbsp;</b></font></td>
<td align="center" valign="bottom"><font style="font-size:8pt"><b>&nbsp;</b></font></td>
<td align="center" valign="bottom"><font style="font-size:8pt"><b>&nbsp;</b></font></td>
<td align="center" valign="bottom" colspan="2"><font style="font-size:8pt"><b>2003</b></font></td>
<td align="center" valign="bottom"><font style="font-size:8pt"><b>&nbsp;</b></font></td>
<td align="center" valign="bottom"><font style="font-size:8pt"><b>&nbsp;</b></font></td>
<td align="center" valign="bottom" colspan="2"><font style="font-size:8pt"><b>2002</b></font></td>
<td align="center" valign="bottom"><font style="font-size:8pt"><b></b></font></td> </tr>
<tr>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"><hr size="1" width="100%" color="black" noshade></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"><hr size="1" width="100%" color="black" noshade></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr bgcolor="#cceeff">
<td valign="bottom" colspan="3"><font style="font-size:10pt"><b>Cash flows from operating activities</b></font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr>
<td valign="bottom" colspan="3"><font style="font-size:10pt">Net income</font></td>
<td valign="bottom"><font style="font-size:10pt">$</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">858</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">$</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">165</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr bgcolor="#cceeff">
<td valign="bottom" colspan="3"><font style="font-size:10pt">Adjustments to reconcile net income to net cash provided by operating activities:</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom" colspan="2"><font style="font-size:10pt">Provision for uncollectible accounts receivable</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">(75 </font></td>
<td valign="bottom"><font style="font-size:10pt">)</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">(134 </font></td>
<td valign="bottom"><font style="font-size:10pt">)</font></td> </tr>
<tr bgcolor="#cceeff">
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom" colspan="2"><font style="font-size:10pt">Depreciation and amortization</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">1,830</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">1,795</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom" colspan="2"><font style="font-size:10pt">Stock based compensation</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">56</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">3</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr bgcolor="#cceeff">
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom" colspan="2"><font style="font-size:10pt">Pension expense, net of contributions</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">(64</font></td>
<td valign="bottom"><font style="font-size:10pt">)</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">2</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom" colspan="2"><font style="font-size:10pt">Loss (gain) on disposal of asset</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">4</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">(46</font></td>
<td valign="bottom"><font style="font-size:10pt">)</font></td> </tr>
<tr bgcolor="#cceeff">
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom" colspan="2"><font style="font-size:10pt">Loss on investments</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">&#151;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">43</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom" colspan="2"><font style="font-size:10pt">Foreign exchange loss on foreign debt</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">&#151;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">39</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr bgcolor="#cceeff">
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom" colspan="2"><font style="font-size:10pt">Changes in operating assets and liabilities:</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">Accounts receivable</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">(897</font></td>
<td valign="bottom"><font style="font-size:10pt">)</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">(33</font></td>
<td valign="bottom"><font style="font-size:10pt">)</font></td> </tr>
<tr bgcolor="#cceeff">
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">Inventories</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">(603</font></td>
<td valign="bottom"><font style="font-size:10pt">)</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">(2,539</font></td>
<td valign="bottom"><font style="font-size:10pt">)</font></td> </tr>
<tr>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">Tax refund receivable</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">701</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">&#151;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr bgcolor="#cceeff">
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">Prepaid expenses</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">(593</font></td>
<td valign="bottom"><font style="font-size:10pt">)</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">(160 </font></td>
<td valign="bottom"><font style="font-size:10pt">)</font></td> </tr>
<tr>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">Other assets</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">(19</font></td>
<td valign="bottom"><font style="font-size:10pt">)</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">(136</font></td>
<td valign="bottom"><font style="font-size:10pt">)</font></td> </tr>
<tr bgcolor="#cceeff">
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">Accounts payable and accrued liabilities</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">293</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">1,879</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">Accrued compensation and employee benefits</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">194</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">159</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"><hr size="1" width="100%" color="black" noshade></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"><hr size="1" width="100%" color="black" noshade></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr bgcolor="#cceeff">
<td valign="bottom"colspan="3"><font style="font-size:10pt">Net cash provided by operating activities</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">1,685</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">1,037</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"><hr size="1" width="100%" color="black" noshade></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"><hr size="1" width="100%" color="black" noshade></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr bgcolor="#cceeff">
<td valign="bottom" colspan="3"><font style="font-size:10pt"><b>Cash flows from investing activities</b></font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom" colspan="2"><font style="font-size:10pt">Capital expenditures</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">(752</font></td>
<td valign="bottom"><font style="font-size:10pt">)</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">(924</font></td>
<td valign="bottom"><font style="font-size:10pt">)</font></td> </tr>
<tr bgcolor="#cceeff">
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom" colspan="2"><font style="font-size:10pt">Proceeds from sale of property and equipment</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">109</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">80</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom" colspan="2"><font style="font-size:10pt">Repayment of notes receivable</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">71</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">330</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr bgcolor="#cceeff">
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom" colspan="2"><font style="font-size:10pt">Issuance of notes receivable</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">&#151;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">(15</font></td>
<td valign="bottom"><font style="font-size:10pt">)</font></td> </tr>
<tr>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom" colspan="2"><font style="font-size:10pt">Other assets</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">&#151;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">1</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"><hr size="1" width="100%" color="black" noshade></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"><hr size="1" width="100%" color="black" noshade></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr bgcolor="#cceeff">
<td valign="bottom" colspan="3"><font style="font-size:10pt">Net cash used in investing activities</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">(572</font></td>
<td valign="bottom"><font style="font-size:10pt">)</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">(528</font></td>
<td valign="bottom"><font style="font-size:10pt">)</font></td> </tr>
<tr>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"><hr size="1" width="100%" color="black" noshade></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"><hr size="1" width="100%" color="black" noshade></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr bgcolor="#cceeff">
<td valign="bottom" colspan="3"><font style="font-size:10pt"><b>Cash flows from financing activities</b></font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom" colspan="2"><font style="font-size:10pt">Net borrowing on lines of credit</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">&#151;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">1,094</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr bgcolor="#cceeff">
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom" colspan="2"><font style="font-size:10pt">Borrowings on long-term debt</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">2,500</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">&#151;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom" colspan="2"><font style="font-size:10pt">Payments on long-term debt </font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">(1,565</font></td>
<td valign="bottom"><font style="font-size:10pt">)</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">(1,506</font></td>
<td valign="bottom"><font style="font-size:10pt">)</font></td> </tr>
<tr bgcolor="#cceeff">
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom" colspan="2"><font style="font-size:10pt">Decrease in restricted cash</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">1,500</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">&#151;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom" colspan="2"><font style="font-size:10pt">Proceeds from issuance of common stock</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">30</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">18</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"><hr size="1" width="100%" color="black" noshade></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"><hr size="1" width="100%" color="black" noshade></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr bgcolor="#cceeff">
<td valign="bottom" colspan="3"><font style="font-size:10pt">Net cash provided by (used in) financing activities</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">2,465</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">(394</font></td>
<td valign="bottom"><font style="font-size:10pt">)</font></td> </tr>
<tr>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"><hr size="1" width="100%" color="black" noshade></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"><hr size="1" width="100%" color="black" noshade></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr bgcolor="#cceeff">
<td valign="bottom" colspan="3"><font style="font-size:10pt">Net increase in cash and cash equivalents</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">3,578</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">115</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom" colspan="2"><font style="font-size:10pt">Cash and cash equivalents at beginning of period</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">640</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">499</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"><hr size="1" width="100%" color="black" noshade></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"><hr size="1" width="100%" color="black" noshade></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr bgcolor="#cceeff">
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom" colspan="2"><font style="font-size:10pt">Cash and cash equivalents at end of period</font></td>
<td valign="bottom"><font style="font-size:10pt">$</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">4,218</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">$</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">614</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"><hr size="3" width="100%" color="black" noshade></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"><hr size="3" width="100%" color="black" noshade></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr bgcolor="#cceeff">
<td valign="bottom" colspan="3"><font style="font-size:10pt"><b>Supplemental disclosures of cash flow information</b></font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom" colspan="2"><font style="font-size:10pt">Cash paid during the year for interest</font></td>
<td valign="bottom"><font style="font-size:10pt">$</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">208</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">$</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">510</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"><hr size="3" width="100%" color="black" noshade></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"><hr size="3" width="100%" color="black" noshade></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr> </table><p align="center"><font style="font-size:10pt"><i>See accompanying notes to consolidated condensed financial statements.</i></font></p> <p align="center"><font
style="font-size:10pt">4</font></p>

<p Style='page-break-before:always'>
<HR  SIZE="3" COLOR="#999999" WIDTH="100%" ALIGN="CENTER">
  <p align="center"><font style="font-size:10pt"><b>NATURAL ALTERNATIVES INTERNATIONAL, INC.<br>NOTES TO UNAUDITED FINANCIAL STATEMENTS</b></font></p> <p><font style="font-size:10pt"><b>Note 1 &#150; Basis of
Presentation and Summary of Significant Accounting Policies</b></font></p> <p><font style="font-size:10pt">The consolidated financial statements include the accounts of Natural Alternatives International, Inc. and its wholly owned subsidiary,
Natural Alternatives International Europe, S.A. (&#147;NAIE&#148;), (the &#147;Company&#148;) and have been prepared by the Company, without audit, pursuant to the rules and regulations of the Securities and Exchange Commission. Certain information
and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States have been condensed or omitted pursuant to such rules and regulations, although the Company
believes that the disclosures herein are adequate to make the information presented not misleading. The Company suggests that these unaudited consolidated financial statements be read in conjunction with the consolidated financial statements and the
notes thereto included in the Company&#146;s latest Annual Report on Form 10-K. In preparing the consolidated financial statements, management is required to make certain estimates and assumptions that may affect the reported amounts of assets,
liabilities, revenues and expenses during the reporting periods. Actual results may differ from such estimates. In the opinion of the Company, all adjustments necessary to present fairly the information in the following unaudited consolidated
condensed financial statements of the Company have been included. The results of operations for such interim periods are not necessarily indicative of the results for the full year. </font></p> <p><font style="font-size:10pt">Certain prior period
amounts have been reclassified to conform to the current period presentation.</font></p> <p><font style="font-size:10pt"><b>Inventories</b></font></p> <p><font style="font-size:10pt">Inventories are recorded at the lower of cost (first in, first
out) or market (net realizable value). Inventories were as follows (dollars in thousands):</font></p>
<table border="0" cellspacing="0" width="100%">
<tr>
<td width="77%" align="center" valign="bottom"><font style="font-size:10pt"><b></b></font></td>
<td width="3%" valign="bottom"><font style="font-size:10pt"></font></td>
<td width="8%" align="right" valign="bottom"><font style="font-size:10pt"></font></td>
<td width="1%" align="center" valign="bottom"><font style="font-size:10pt"></font></td>
<td width="3%" valign="bottom"><font style="font-size:10pt"></font></td>
<td width="8%" align="center" valign="bottom"><font style="font-size:10pt"></font><font style="font-size:10pt"><b></b></font></td> </tr>
<tr>
<td align="center" valign="bottom" width="77%"><font style="font-size:8pt"><b>&nbsp;</b></font></td>
<td align="center" valign="bottom" colspan="2"><font style="font-size:8pt"><b>March 31, 2003</b></font></td>
<td align="center" valign="bottom" width="1%"><font style="font-size:8pt"><b>&nbsp;</b></font></td>
<td align="center" valign="bottom" colspan="2"><font style="font-size:8pt"><b>June 30, 2002</b></font></td> </tr>
<tr>
<td valign="bottom" width="77%"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"><hr size="1" width="100%" color="black" noshade></td>
<td valign="bottom" width="1%"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"><hr size="1" width="100%" color="black" noshade></td> </tr>
<tr bgcolor="#cceeff">
<td valign="bottom" width="77%"><font style="font-size:10pt">Raw materials</font></td>
<td valign="bottom" width="3%"><font style="font-size:10pt">$</font></td>
<td align="right" valign="bottom" width="8%"><font style="font-size:10pt">3,681 </font></td>
<td valign="bottom" width="1%"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom" width="3%"><font style="font-size:10pt">$</font></td>
<td align="right" valign="bottom" width="8%"><font style="font-size:10pt">4,631 </font></td> </tr>
<tr>
<td valign="bottom" width="77%"><font style="font-size:10pt">Work in progress</font></td>
<td valign="bottom" width="3%"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" width="8%"><font style="font-size:10pt">3,234 </font></td>
<td valign="bottom" width="1%"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom" width="3%"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" width="8%"><font style="font-size:10pt">1,754 </font></td> </tr>
<tr bgcolor="#cceeff">
<td valign="bottom" width="77%"><font style="font-size:10pt">Finished goods</font></td>
<td valign="bottom" width="3%"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" width="8%"><font style="font-size:10pt">1,559 </font></td>
<td valign="bottom" width="1%"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom" width="3%"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" width="8%"><font style="font-size:10pt">1,486 </font></td> </tr>
<tr>
<td valign="bottom" width="77%"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"><hr size="1" width="100%" color="black" noshade></td>
<td valign="bottom" width="1%"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"><hr size="1" width="100%" color="black" noshade></td> </tr>
<tr bgcolor="#cceeff">
<td valign="bottom" width="77%"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom" width="3%"><font style="font-size:10pt">$</font></td>
<td align="right" valign="bottom" width="8%"><font style="font-size:10pt">8,474 </font></td>
<td valign="bottom" width="1%"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom" width="3%"><font style="font-size:10pt">$</font></td>
<td align="right" valign="bottom" width="8%"><font style="font-size:10pt">7,871 </font></td> </tr>
<tr>
<td valign="bottom" width="77%"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"><hr size="3" width="100%" color="black" noshade></td>
<td valign="bottom" width="1%"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"><hr size="3" width="100%" color="black" noshade></td> </tr> </table> <p><font style="font-size:10pt"><b>Property and Equipment</b></font></p> <p><font style="font-size:10pt">Property and equipment are
stated at cost less accumulated depreciation. Property and equipment were as follows (dollars in thousands):</font></p>
<table border="0" cellspacing="0" width="100%">
<tr>
<td width="2%" align="center" valign="bottom"><font style="font-size:10pt"><b></b></font></td>
<td width="70%" valign="bottom"><font style="font-size:10pt"></font></td>
<td width="6%" align="center" valign="bottom"><font style="font-size:10pt"></font></td>
<td width="3%" align="center" valign="bottom"><font style="font-size:10pt"></font></td>
<td width="1%" valign="bottom"><font style="font-size:10pt"></font></td>
<td width="6%" align="right" valign="bottom"><font style="font-size:10pt"></font></td>
<td width="1%" valign="bottom"><font style="font-size:10pt"></font></td>
<td width="3%" align="center" valign="bottom"><font style="font-size:10pt"></font></td>
<td width="1%" valign="bottom"><font style="font-size:10pt"></font></td>
<td width="6%" align="right" valign="bottom"><font style="font-size:10pt"></font></td>
<td width="1%" align="center" valign="bottom"><font style="font-size:10pt"><b></b></font></td> </tr>
<tr>
<td align="center" valign="bottom"><font style="font-size:8pt"><b>&nbsp;</b></font></td>
<td align="center" valign="bottom"><font style="font-size:8pt"><b>&nbsp;</b></font></td>
<td align="center" valign="bottom"><font style="font-size:8pt"><b>Life Used for Depreciation</b></font></td>
<td align="center" valign="bottom"><font style="font-size:8pt"><b>&nbsp;</b></font></td>
<td align="center" valign="bottom" colspan="2"><font style="font-size:8pt"><b>March 31, 2003</b></font></td>
<td align="center" valign="bottom"><font style="font-size:8pt"><b>&nbsp;</b></font></td>
<td align="center" valign="bottom"><font style="font-size:8pt"><b>&nbsp;</b></font></td>
<td align="center" valign="bottom" colspan="2"><font style="font-size:8pt"><b>June 30, 2002</b></font></td>
<td align="center" valign="bottom"><font style="font-size:8pt"><b></b></font></td> </tr>
<tr>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="center" valign="bottom"><hr size="1" width="100%" color="black" noshade></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"><hr size="1" width="100%" color="black" noshade></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"><hr size="1" width="100%" color="black" noshade></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr bgcolor="#cceeff">
<td valign="bottom" colspan="2"><font style="font-size:10pt">Land</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">NA</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">$</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">393</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">$</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">393</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr>
<td valign="bottom" colspan="2"><font style="font-size:10pt">Building and building improvements</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">5 - 39 years</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">3,288</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">3,279</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr bgcolor="#cceeff">
<td valign="bottom" colspan="2"><font style="font-size:10pt">Machinery and equipment</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">3 - 15 years</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">15,399</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">15,517</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr>
<td valign="bottom" colspan="2"><font style="font-size:10pt">Office equipment and furniture</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">5 - 7 years</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">4,158</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">4,054</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr bgcolor="#cceeff">
<td valign="bottom" colspan="2"><font style="font-size:10pt">Vehicles</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">3 years</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">197</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">197</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr>
<td valign="bottom" colspan="2"><font style="font-size:10pt">Leasehold improvements</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">5 - 39 years</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">4,439</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">4,230</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="center" valign="bottom">&nbsp;</td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"><hr size="1" width="100%" color="black" noshade></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"><hr size="1" width="100%" color="black" noshade></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr bgcolor="#cceeff">
<td valign="bottom" colspan="2"><font style="font-size:10pt">Total property and equipment</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">27,874</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">27,670</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr>
<td valign="bottom" colspan="2"><font style="font-size:10pt">Less accumulated depreciation and amortization</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">(16,626</font></td>
<td valign="bottom"><font style="font-size:10pt">)</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">(15,231</font></td>
<td valign="bottom"><font style="font-size:10pt">)</font></td> </tr>
<tr>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"><hr size="1" width="100%" color="black" noshade></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"><hr size="1" width="100%" color="black" noshade></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr bgcolor="#cceeff">
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">Property and equipment, net</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">$</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">11,248</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">$</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">12,439</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"><hr size="3" width="100%" color="black" noshade></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"><hr size="3" width="100%" color="black" noshade></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr> </table> <p align="center"><font style="font-size:10pt">5</font></p>

<p Style='page-break-before:always'>
<HR  SIZE="3" COLOR="#999999" WIDTH="100%" ALIGN="CENTER">
  <p align="center"><font style="font-size:10pt"><b>NATURAL ALTERNATIVES INTERNATIONAL, INC.<br>NOTES TO UNAUDITED FINANCIAL STATEMENTS</b></font></p> <p><font style="font-size:10pt"><b>Note 1 &#150; Basis of
Presentation and Summary of Significant Accounting Policies (Continued)</b></font></p> <p><font style="font-size:10pt"><b>Net Income Per Share</b></font></p> <p><font style="font-size:10pt">The Company computes net income per share in accordance
with Statement of Financial Accounting Standards (&#147;SFAS&#148;) No. 128, &#147;Earnings Per Share.&#148; This statement requires the presentation of basic net income per share, using the weighted average number of shares outstanding during the
period, and diluted net income per share, using the additional dilutive effect of all dilutive securities. The dilutive impact of stock options account for the additional weighted average shares of common stock outstanding for the Company&#146;s
diluted net income per share computation. Basic and diluted net income per share are calculated as follows (dollars in thousands, except per share amounts):</font></p>
<table border="0" cellspacing="0" width="100%">
<tr>
<td width="55%" align="center" valign="bottom"><font style="font-size:10pt"><b></b></font></td>
<td width="1%" valign="bottom"><font style="font-size:10pt"></font></td>
<td width="8%" align="right" valign="bottom"><font style="font-size:10pt"></font></td>
<td width="3%" align="center" valign="bottom"><font style="font-size:10pt"></font></td>
<td width="1%" valign="bottom"><font style="font-size:10pt"></font></td>
<td width="8%" align="right" valign="bottom"><font style="font-size:10pt"></font></td>
<td width="3%" align="center" valign="bottom"><font style="font-size:10pt"></font></td>
<td width="1%" valign="bottom"><font style="font-size:10pt"></font></td>
<td width="8%" align="right" valign="bottom"><font style="font-size:10pt"></font></td>
<td width="3%" align="center" valign="bottom"><font style="font-size:10pt"></font></td>
<td width="1%" valign="bottom"><font style="font-size:10pt"></font></td>
<td width="8%" align="center" valign="bottom"><font style="font-size:10pt"><b></b></font></td> </tr>
<tr>
<td align="center" valign="bottom"><font style="font-size:8pt"><b>&nbsp;</b></font></td>
<td align="center" valign="bottom" colspan="5"><font style="font-size:8pt"><b>Three Months Ended March 31,</b></font></td>
<td align="center" valign="bottom"><font style="font-size:8pt"><b>&nbsp;</b></font></td>
<td align="center" valign="bottom" colspan="5"><font style="font-size:8pt"><b>Nine Months Ended March 31, </b></font></td> </tr>
<tr>
<td align="center" valign="bottom"><font style="font-size:8pt"><b>&nbsp;</b></font></td>
<td align="center" valign="bottom" colspan="5"><hr size="1" width="100%" color="black" noshade></td>
<td align="center" valign="bottom"><font style="font-size:8pt"><b>&nbsp;</b></font></td>
<td align="center" valign="bottom" colspan="5"><hr size="1" width="100%" color="black" noshade></td> </tr>
<tr>
<td align="center" valign="bottom"><font style="font-size:8pt"><b>&nbsp;</b></font></td>
<td align="center" valign="bottom" colspan="2"><font style="font-size:8pt"><b>2003</b></font></td>
<td align="center" valign="bottom"><font style="font-size:8pt"><b>&nbsp;</b></font></td>
<td align="center" valign="bottom" colspan="2"><font style="font-size:8pt"><b>2002</b></font></td>
<td align="center" valign="bottom"><font style="font-size:8pt"><b>&nbsp;</b></font></td>
<td align="center" valign="bottom" colspan="2"><font style="font-size:8pt"><b>2003</b></font></td>
<td align="center" valign="bottom"><font style="font-size:8pt"><b>&nbsp;</b></font></td>
<td align="center" valign="bottom" colspan="2"><font style="font-size:8pt"><b>2002</b></font></td> </tr>
<tr>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"><hr size="1" width="100%" color="black" noshade></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"><hr size="1" width="100%" color="black" noshade></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"><hr size="1" width="100%" color="black" noshade></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"><hr size="1" width="100%" color="black" noshade></td> </tr>
<tr bgcolor="#cceeff">
<td valign="bottom"><font style="font-size:10pt"><b>Numerator</b></font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr>
<td valign="bottom"><font style="font-size:10pt">Net income</font></td>
<td valign="bottom"><font style="font-size:10pt">$</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">172</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">$</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">759</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">$</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">858</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">$</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">165</font></td> </tr>
<tr bgcolor="#cceeff">
<td valign="bottom"><font style="font-size:10pt"><b>Denominator</b></font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr>
<td valign="bottom"><font style="font-size:10pt">Basic weighted average common shares outstanding</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">5,814,258</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">5,794,613</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">5,807,143</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">5,788,608</font></td> </tr>
<tr bgcolor="#cceeff">
<td valign="bottom"><font style="font-size:10pt">Dilutive effect of stock options</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">247,133</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">1,220</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">197,161</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">407</font></td> </tr>
<tr>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"><hr size="1" width="100%" color="black" noshade></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"><hr size="1" width="100%" color="black" noshade></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"><hr size="1" width="100%" color="black" noshade></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"><hr size="1" width="100%" color="black" noshade></td> </tr>
<tr bgcolor="#cceeff">
<td valign="bottom"><font style="font-size:10pt">Diluted weighted average common shares outstanding</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">6,061,391</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">5,795,833</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">6,004,304</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">5,789,015</font></td> </tr>
<tr>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"><hr size="3" width="100%" color="black" noshade></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"><hr size="3" width="100%" color="black" noshade></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"><hr size="3" width="100%" color="black" noshade></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"><hr size="3" width="100%" color="black" noshade></td> </tr>
<tr bgcolor="#cceeff">
<td valign="bottom"><font style="font-size:10pt">Basic net income per share</font></td>
<td valign="bottom"><font style="font-size:10pt">$</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">0.03</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">$</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">0.13</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">$</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt"> 0.15</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">$</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">0.03</font></td> </tr>
<tr>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"><hr size="3" width="100%" color="black" noshade></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"><hr size="3" width="100%" color="black" noshade></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"><hr size="3" width="100%" color="black" noshade></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"><hr size="3" width="100%" color="black" noshade></td> </tr>
<tr bgcolor="#cceeff">
<td valign="bottom"><font style="font-size:10pt">Diluted net income per share</font></td>
<td valign="bottom"><font style="font-size:10pt">$</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">0.03</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">$</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">0.13</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">$</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">0.14</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">$</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">0.03</font></td> </tr>
<tr>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"><hr size="3" width="100%" color="black" noshade></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"><hr size="3" width="100%" color="black" noshade></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"><hr size="3" width="100%" color="black" noshade></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"><hr size="3" width="100%" color="black" noshade></td> </tr> </table> <p><font style="font-size:10pt">For the three and nine months ended March 31, 2003, there were outstanding options to purchase 65,000
and 100,000 shares, respectively, of common stock, that were not included in the computation of diluted net income per share as their effect would have been anti-dilutive. </font></p> <p><font style="font-size:10pt">For the three and nine months
ended March 31, 2002, there were outstanding options to purchase 573,400 and 533,410 shares, respectively, of common stock, that were not included in the computation of diluted net income per share as their effect would have been
anti-dilutive.</font></p> <p><font style="font-size:10pt"><b>Stock Based Compensation</b></font></p> <p><font style="font-size:10pt">The Company accounts for the issuance of stock option grants in accordance with Accounting Principles Board opinion
(APB) No. 25 and related interpretations in accounting for stock options. In December 2002, the FASB issued SFAS No.&nbsp;148, &#147;Accounting for Stock-Based Compensation&nbsp;&#151; Transition and Disclosure&nbsp;&#151; an amendment of FASB
Statement No.&nbsp;123.&#148; SFAS No.&nbsp;148 amended SFAS No.&nbsp;123, &#147;Accounting for Stock-Based Compensation,&#148; to provide alternative methods of transition for a voluntary change to the fair value based method of accounting for
stock-based employee compensation. In addition, SFAS No.&nbsp;148 amended the disclosure requirements of SFAS No.&nbsp;123 to require prominent disclosures of the method used to account for stock-based employee compensation and the effect of the
method on reported results in both annual and interim financial statements. In accordance with SFAS No. 148, the following pro-forma information has been determined as if the Company had accounted for its employee stock options under the fair value
method of SFAS 123. </font></p> <p><font style="font-size:10pt">The fair value of the option grants was estimated on the date of grant using the Black-Scholes option pricing model with the following assumptions for the quarters ended March 31, 2003
and 2002: risk-free interest rate of 4.0% and 4.4%, respectively; dividend yield rate of zero; expected life of four to six years and four to nine years, respectively, depending on option termination date; and volatility of 71% and 53%, </font></p>
<p align="center"><font style="font-size:10pt">6</font></p>

<p Style='page-break-before:always'>
<HR  SIZE="3" COLOR="#999999" WIDTH="100%" ALIGN="CENTER">
 <p align="center"><font style="font-size:10pt"><b>NATURAL ALTERNATIVES INTERNATIONAL, INC.<br></b></font><font style="font-size:10pt"><b>NOTES TO UNAUDITED FINANCIAL STATEMENTS</b></font></p> <p><font
style="font-size:10pt"><b>Note 1 &#150; Basis of Presentation and Summary of Significant Accounting Policies (Continued)</b></font></p> <p><font style="font-size:10pt"><b>Stock Based Compensation (Continued)</b></font></p> <p><font
style="font-size:10pt">respectively. For purposes of pro forma disclosures, the estimated fair value of the options is amortized to expense over the vesting period of the related options. The Company&#146;s pro forma information follows (dollars in
thousands, except per share amounts):</font></p>
<table border="0" cellspacing="0" width="100%">
<tr>
<td width="2%" align="center" valign="bottom"><font style="font-size:10pt"><b></b></font></td>
<td width="49%" valign="bottom"><font style="font-size:10pt"></font></td>
<td width="1%" valign="bottom"><font style="font-size:10pt"></font></td>
<td width="8%" align="right" valign="bottom"><font style="font-size:10pt"></font></td>
<td width="1%" valign="bottom"><font style="font-size:10pt"></font></td>
<td width="3%" valign="bottom"><font style="font-size:10pt"></font></td>
<td width="1%" valign="bottom"><font style="font-size:10pt"></font></td>
<td width="8%" align="right" valign="bottom"><font style="font-size:10pt"></font></td>
<td width="1%" valign="bottom"><font style="font-size:10pt"></font></td>
<td width="3%" valign="bottom"><font style="font-size:10pt"></font></td>
<td width="1%" valign="bottom"><font style="font-size:10pt"></font></td>
<td width="8%" align="right" valign="bottom"><font style="font-size:10pt"></font></td>
<td width="1%" valign="bottom"><font style="font-size:10pt"></font></td>
<td width="3%" valign="bottom"><font style="font-size:10pt"></font></td>
<td width="1%" valign="bottom"><font style="font-size:10pt"></font></td>
<td width="8%" align="right" valign="bottom"><font style="font-size:10pt"></font></td>
<td width="1%" align="center" valign="bottom"><font style="font-size:10pt"></font><font style="font-size:10pt"><b></b></font></td> </tr>
<tr>
<td align="center" valign="bottom"><font style="font-size:8pt"><b>&nbsp;</b></font></td>
<td align="center" valign="bottom"><font style="font-size:8pt"><b>&nbsp;</b></font></td>
<td align="center" valign="bottom" colspan="6"><font style="font-size:8pt"><b>Three Months Ended March 31,</b></font></td>
<td align="center" valign="bottom"><font style="font-size:8pt"><b>&nbsp;</b></font></td>
<td align="center" valign="bottom"><font style="font-size:8pt"><b>&nbsp;</b></font></td>
<td align="center" valign="bottom" colspan="6"><font style="font-size:8pt"><b>Nine Months Ended March 31, </b></font></td>
<td align="center" valign="bottom"><font style="font-size:8pt"><b>&nbsp;</b></font></td> </tr>
<tr>
<td align="center" valign="bottom"><font style="font-size:8pt"><b>&nbsp;</b></font></td>
<td align="center" valign="bottom"><font style="font-size:8pt"><b>&nbsp;</b></font></td>
<td align="center" valign="bottom" colspan="6"><hr size="1" width="100%" color="black" noshade></td>
<td align="center" valign="bottom"><font style="font-size:8pt"><b>&nbsp;</b></font></td>
<td align="center" valign="bottom"><font style="font-size:8pt"><b>&nbsp;</b></font></td>
<td align="center" valign="bottom" colspan="6"><hr size="1" width="100%" color="black" noshade></td>
<td align="center" valign="bottom"><font style="font-size:8pt"><b>&nbsp;</b></font></td> </tr>
<tr>
<td align="center" valign="bottom"><font style="font-size:8pt"><b>&nbsp;</b></font></td>
<td align="center" valign="bottom"><font style="font-size:8pt"><b>&nbsp;</b></font></td>
<td align="center" valign="bottom" colspan="2"><font style="font-size:8pt"><b>2003</b></font></td>
<td align="center" valign="bottom"><font style="font-size:8pt"><b>&nbsp;</b></font></td>
<td align="center" valign="bottom"><font style="font-size:8pt"><b>&nbsp;</b></font></td>
<td align="center" valign="bottom" colspan="2"><font style="font-size:8pt"><b>2002</b></font></td>
<td align="center" valign="bottom"><font style="font-size:8pt"><b>&nbsp;</b></font></td>
<td align="center" valign="bottom"><font style="font-size:8pt"><b>&nbsp;</b></font></td>
<td align="center" valign="bottom" colspan="2"><font style="font-size:8pt"><b>2003</b></font></td>
<td align="center" valign="bottom"><font style="font-size:8pt"><b>&nbsp;</b></font></td>
<td align="center" valign="bottom"><font style="font-size:8pt"><b>&nbsp;</b></font></td>
<td align="center" valign="bottom" colspan="2"><font style="font-size:8pt"><b>2002</b></font></td>
<td align="center" valign="bottom"><font style="font-size:8pt"><b></b></font></td> </tr>
<tr>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"><hr size="1" width="100%" color="black" noshade></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"><hr size="1" width="100%" color="black" noshade></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"><hr size="1" width="100%" color="black" noshade></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"><hr size="1" width="100%" color="black" noshade></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr bgcolor="#cceeff">
<td valign="bottom" colspan="2"><font style="font-size:10pt">Net income as reported</font></td>
<td valign="bottom"><font style="font-size:10pt">$</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">172</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">$</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">759</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">$</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">858</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">$</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">165</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr>
<td valign="bottom" colspan="2"><div style="margin-left:20px; text-indent:-20px"><font style="font-size:10pt">Add: Stock-based employee compensation expense included in reported net income</font></div></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">5</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">&#151;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">56</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">3 </font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr bgcolor="#cceeff">
<td valign="bottom" colspan="2"><div style="margin-left:20px; text-indent:-20px"><font style="font-size:10pt">Deduct: Stock-based employee compensation expense determined under the fair value based method for all awards, net of related tax
effects</font></div></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">(86</font></td>
<td valign="bottom"><font style="font-size:10pt">)</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">(78</font></td>
<td valign="bottom"><font style="font-size:10pt">)</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">(231</font></td>
<td valign="bottom"><font style="font-size:10pt">)</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">(117</font></td>
<td valign="bottom"><font style="font-size:10pt">)</font></td> </tr>
<tr>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"><hr size="1" width="100%" color="black" noshade></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"><hr size="1" width="100%" color="black" noshade></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"><hr size="1" width="100%" color="black" noshade></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"><hr size="1" width="100%" color="black" noshade></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr bgcolor="#cceeff">
<td valign="bottom" colspan="2"><font style="font-size:10pt">Pro forma net income</font></td>
<td valign="bottom"><font style="font-size:10pt">$</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">91</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">$</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">681</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">$</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">683</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">$</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">51</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"><hr size="3" width="100%" color="black" noshade></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"><hr size="3" width="100%" color="black" noshade></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"><hr size="3" width="100%" color="black" noshade></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"><hr size="3" width="100%" color="black" noshade></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr bgcolor="#cceeff">
<td valign="bottom" colspan="2"><font style="font-size:10pt">Earnings per share:</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">Basic &#150; as reported</font></td>
<td valign="bottom"><font style="font-size:10pt">$</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">0.03</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">$</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">0.13</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">$</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">0.15</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">$</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">0.03</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"><hr size="3" width="100%" color="black" noshade></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"><hr size="3" width="100%" color="black" noshade></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"><hr size="3" width="100%" color="black" noshade></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"><hr size="3" width="100%" color="black" noshade></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr bgcolor="#cceeff">
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">Basic &#150; pro forma</font></td>
<td valign="bottom"><font style="font-size:10pt">$</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">0.02</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">$</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">0.12</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">$</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">0.12</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">$</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">0.01</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"><hr size="3" width="100%" color="black" noshade></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"><hr size="3" width="100%" color="black" noshade></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"><hr size="3" width="100%" color="black" noshade></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"><hr size="3" width="100%" color="black" noshade></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr bgcolor="#cceeff">
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">Diluted &#150; as reported</font></td>
<td valign="bottom"><font style="font-size:10pt">$</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">0.03</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">$</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">0.13</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">$</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">0.14</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">$</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">0.03</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"><hr size="3" width="100%" color="black" noshade></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"><hr size="3" width="100%" color="black" noshade></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"><hr size="3" width="100%" color="black" noshade></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"><hr size="3" width="100%" color="black" noshade></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr bgcolor="#cceeff">
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">Diluted &#150; pro forma</font></td>
<td valign="bottom"><font style="font-size:10pt">$</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">0.02</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">$</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">0.12</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">$</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">0.11</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">$</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">0.01</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"><hr size="3" width="100%" color="black" noshade></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"><hr size="3" width="100%" color="black" noshade></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"><hr size="3" width="100%" color="black" noshade></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"><hr size="3" width="100%" color="black" noshade></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr> </table> <p><font style="font-size:10pt"><b>Recent Accounting Pronouncements</b></font></p> <p><font style="font-size:10pt">In June 2002, the Financial Accounting Standards
Board (the &#147;FASB&#148;) issued SFAS No. 146, &#147;Accounting for Costs Associated with Exit or Disposal Activities,&#148; which addresses significant issues regarding the recognition, measurement, and reporting of costs associated with exit
and disposal activities, including restructuring activities. This statement requires that costs associated with exit or disposal activities be recognized when they are incurred rather than at the date of a commitment to an exit or disposal plan.
SFAS No. 146 is effective for all exit or disposal activities initiated after December 31, 2002. Adoption of this statement did not have a material impact on the Company&#146;s results of operations or financial position.</font></p> <p
align="center"><font style="font-size:10pt">7</font></p>

<p Style='page-break-before:always'>
<HR  SIZE="3" COLOR="#999999" WIDTH="100%" ALIGN="CENTER">
  <p align="center"><font style="font-size:10pt"><b>NATURAL ALTERNATIVES INTERNATIONAL, INC.<br>NOTES TO UNAUDITED FINANCIAL STATEMENTS</b></font></p> <p><font style="font-size:10pt"><b>Note 2 &#150; Economic
Dependency</b></font></p> <p><font style="font-size:10pt">The Company had substantial sales to two separate contract manufacturing customers during the periods shown in the following table. The loss of either of these customers could have a material
adverse impact on the Company&#146;s sales and earnings. Net sales by customer, representing 10% or more of the respective quarter&#146;s total net sales, are shown below (dollars in thousands):</font></p>
<table border="0" cellspacing="0" width="100%">
<tr>
<td width="19%" align="center" valign="bottom"><font style="font-size:10pt"><b></b></font></td>
<td width="1%" valign="bottom"><font style="font-size:10pt"></font></td>
<td width="8%" align="right" valign="bottom"><font style="font-size:10pt"></font></td>
<td width="3%" valign="bottom"><font style="font-size:10pt"></font></td>
<td width="5%" align="right" valign="bottom"><font style="font-size:10pt"></font></td>
<td width="1%" valign="bottom"><font style="font-size:10pt"></font></td>
<td width="3%" valign="bottom"><font style="font-size:10pt"></font></td>
<td width="1%" valign="bottom"><font style="font-size:10pt"></font></td>
<td width="8%" align="right" valign="bottom"><font style="font-size:10pt"></font></td>
<td width="3%" valign="bottom"><font style="font-size:10pt"></font></td>
<td width="5%" align="right" valign="bottom"><font style="font-size:10pt"></font></td>
<td width="1%" valign="bottom"><font style="font-size:10pt"></font></td>
<td width="3%" valign="bottom"><font style="font-size:10pt"></font></td>
<td width="1%" valign="bottom"><font style="font-size:10pt"></font></td>
<td width="8%" align="right" valign="bottom"><font style="font-size:10pt"></font></td>
<td width="3%" valign="bottom"><font style="font-size:10pt"></font></td>
<td width="5%" align="right" valign="bottom"><font style="font-size:10pt"></font></td>
<td width="1%" valign="bottom"><font style="font-size:10pt"></font></td>
<td width="3%" valign="bottom"><font style="font-size:10pt"></font></td>
<td width="1%" valign="bottom"><font style="font-size:10pt"></font></td>
<td width="8%" align="right" valign="bottom"><font style="font-size:10pt"></font></td>
<td width="3%" valign="bottom"><font style="font-size:10pt"></font></td>
<td width="5%" align="right" valign="bottom"><font style="font-size:10pt"></font></td>
<td width="1%" align="center" valign="bottom"><font style="font-size:10pt"></font><font style="font-size:10pt"><b></b></font></td> </tr>
<tr>
<td align="center" valign="bottom"><font style="font-size:8pt"><b>&nbsp;</b></font></td>
<td align="center" valign="bottom" colspan="10"><font style="font-size:8pt"><b>Three months ended March 31,</b></font></td>
<td align="center" valign="bottom"><font style="font-size:8pt"><b>&nbsp;</b></font></td>
<td align="center" valign="bottom"><font style="font-size:8pt"><b>&nbsp;</b></font></td>
<td align="center" valign="bottom" colspan="10"><font style="font-size:8pt"><b>Nine months ended March 31,</b></font></td>
<td align="center" valign="bottom"><font style="font-size:8pt"><b>&nbsp;</b></font></td> </tr>
<tr>
<td align="center" valign="bottom"><font style="font-size:8pt"><b>&nbsp;</b></font></td>
<td align="center" valign="bottom" colspan="10"><hr size="1" width="100%" color="black" noshade></td>
<td align="center" valign="bottom"><font style="font-size:8pt"><b>&nbsp;</b></font></td>
<td align="center" valign="bottom"><font style="font-size:8pt"><b>&nbsp;</b></font></td>
<td align="center" valign="bottom" colspan="10"><hr size="1" width="100%" color="black" noshade></td>
<td align="center" valign="bottom"><font style="font-size:8pt"><b>&nbsp;</b></font></td> </tr>
<tr>
<td align="center" valign="bottom"><font style="font-size:8pt"><b>&nbsp;</b></font></td>
<td align="center" valign="bottom" colspan="4"><font style="font-size:8pt"><b>2003</b></font></td>
<td align="center" valign="bottom"><font style="font-size:8pt"><b>&nbsp;</b></font></td>
<td align="center" valign="bottom"><font style="font-size:8pt"><b>&nbsp;</b></font></td>
<td align="center" valign="bottom" colspan="4"><font style="font-size:8pt"><b>2002</b></font></td>
<td align="center" valign="bottom"><font style="font-size:8pt"><b>&nbsp;</b></font></td>
<td align="center" valign="bottom"><font style="font-size:8pt"><b>&nbsp;</b></font></td>
<td align="center" valign="bottom" colspan="4"><font style="font-size:8pt"><b>2003</b></font></td>
<td align="center" valign="bottom"><font style="font-size:8pt"><b>&nbsp;</b></font></td>
<td align="center" valign="bottom"><font style="font-size:8pt"><b>&nbsp;</b></font></td>
<td align="center" valign="bottom" colspan="4"><font style="font-size:8pt"><b>2002</b></font></td>
<td align="center" valign="bottom"><font style="font-size:8pt"><b></b></font></td> </tr>
<tr>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="4"><hr size="1" width="100%" color="black" noshade></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="4"><hr size="1" width="100%" color="black" noshade></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="4"><hr size="1" width="100%" color="black" noshade></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="4"><hr size="1" width="100%" color="black" noshade></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr bgcolor="#cceeff">
<td valign="bottom"><font style="font-size:10pt">Customer 1</font></td>
<td valign="bottom"><font style="font-size:10pt">$</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">5,756</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">42</font></td>
<td valign="bottom"><font style="font-size:10pt">%</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">$</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">6,740</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">52</font></td>
<td valign="bottom"><font style="font-size:10pt">%</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">$</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">17,234</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">43</font></td>
<td valign="bottom"><font style="font-size:10pt">%</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">$</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">17,100</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">48</font></td>
<td valign="bottom"><font style="font-size:10pt">%</font></td> </tr>
<tr>
<td valign="bottom"><font style="font-size:10pt">Customer 2</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">4,361</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">32</font></td>
<td valign="bottom"><font style="font-size:10pt">%</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">2,865</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">22</font></td>
<td valign="bottom"><font style="font-size:10pt">%</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">10,774</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">27</font></td>
<td valign="bottom"><font style="font-size:10pt">%</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">7,095</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">20</font></td>
<td valign="bottom"><font style="font-size:10pt">%</font></td> </tr>
<tr>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"><hr size="1" width="100%" color="black" noshade></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><hr size="1" width="100%" color="black" noshade></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"><hr size="1" width="100%" color="black" noshade></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><hr size="1" width="100%" color="black" noshade></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"><hr size="1" width="100%" color="black" noshade></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><hr size="1" width="100%" color="black" noshade></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"><hr size="1" width="100%" color="black" noshade></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><hr size="1" width="100%" color="black" noshade></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr bgcolor="#cceeff">
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">$</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">10,117</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">74</font></td>
<td valign="bottom"><font style="font-size:10pt">%</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">$</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">9,605</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">74</font></td>
<td valign="bottom"><font style="font-size:10pt">%</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">$</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">28,008</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">70</font></td>
<td valign="bottom"><font style="font-size:10pt">%</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">$</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">24,195</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">68</font></td>
<td valign="bottom"><font style="font-size:10pt">%</font></td> </tr>
<tr>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"><hr size="3" width="100%" color="black" noshade></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><hr size="3" width="100%" color="black" noshade></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"><hr size="3" width="100%" color="black" noshade></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><hr size="3" width="100%" color="black" noshade></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"><hr size="3" width="100%" color="black" noshade></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><hr size="3" width="100%" color="black" noshade></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"><hr size="3" width="100%" color="black" noshade></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><hr size="3" width="100%" color="black" noshade></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr> </table> <p><font style="font-size:10pt">Accounts receivable from these customers totaled $3.8 million and $2.5 million at March 31, 2003 and June 30, 2002,
respectively.</font></p> <p><font style="font-size:10pt">Direct-to-consumer sales were approximately $2.5 million and $2.0 million for the three months ended March 31, 2003 and 2002, respectively, and $7.5 million and $5.8 million for the nine
months ended March 31, 2003 and 2002, respectively.</font></p> <p><font style="font-size:10pt">The Company purchases certain products it does not manufacture from a limited number of raw material suppliers. The Company had substantial purchases from
three separate suppliers during the periods shown in the following table. The loss of any of these suppliers could have a material adverse impact on the Company&#146;s sales and earnings. </font></p> <p><font style="font-size:10pt">Raw material
purchases, representing 10% or more of the respective quarter&#146;s raw material purchases, are shown below (dollars in thousands):</font></p>
<table border="0" cellspacing="0" width="100%">
<tr>
<td width="15%" align="center" valign="bottom"><font style="font-size:10pt"><b></b></font></td>
<td width="1%" valign="bottom"><font style="font-size:10pt"></font></td>
<td width="8%" align="right" valign="bottom"><font style="font-size:10pt"></font></td>
<td width="1%" valign="bottom"><font style="font-size:10pt"></font></td>
<td width="3%" valign="bottom"><font style="font-size:10pt"></font></td>
<td width="5%" align="right" valign="bottom"><font style="font-size:10pt"></font></td>
<td width="1%" valign="bottom"><font style="font-size:10pt"></font></td>
<td width="3%" valign="bottom"><font style="font-size:10pt"></font></td>
<td width="1%" valign="bottom"><font style="font-size:10pt"></font></td>
<td width="8%" align="right" valign="bottom"><font style="font-size:10pt"></font></td>
<td width="1%" valign="bottom"><font style="font-size:10pt"></font></td>
<td width="3%" valign="bottom"><font style="font-size:10pt"></font></td>
<td width="5%" align="right" valign="bottom"><font style="font-size:10pt"></font></td>
<td width="1%" valign="bottom"><font style="font-size:10pt"></font></td>
<td width="3%" valign="bottom"><font style="font-size:10pt"></font></td>
<td width="1%" valign="bottom"><font style="font-size:10pt"></font></td>
<td width="8%" align="right" valign="bottom"><font style="font-size:10pt"></font></td>
<td width="1%" valign="bottom"><font style="font-size:10pt"></font></td>
<td width="3%" valign="bottom"><font style="font-size:10pt"></font></td>
<td width="5%" align="right" valign="bottom"><font style="font-size:10pt"></font></td>
<td width="1%" valign="bottom"><font style="font-size:10pt"></font></td>
<td width="3%" valign="bottom"><font style="font-size:10pt"></font></td>
<td width="1%" valign="bottom"><font style="font-size:10pt"></font></td>
<td width="8%" align="right" valign="bottom"><font style="font-size:10pt"></font></td>
<td width="1%" valign="bottom"><font style="font-size:10pt"></font></td>
<td width="3%" valign="bottom"><font style="font-size:10pt"></font></td>
<td width="5%" align="right" valign="bottom"><font style="font-size:10pt"></font></td>
<td width="1%" align="center" valign="bottom"><font style="font-size:10pt"></font><font style="font-size:10pt"><b></b></font></td> </tr>
<tr>
<td align="center" valign="bottom"><font style="font-size:8pt"><b>&nbsp;</b></font></td>
<td align="center" valign="bottom" colspan="12"><font style="font-size:8pt"><b>Three months ended March 31,</b></font></td>
<td align="center" valign="bottom"><font style="font-size:8pt"><b>&nbsp;</b></font></td>
<td align="center" valign="bottom"><font style="font-size:8pt"><b>&nbsp;</b></font></td>
<td align="center" valign="bottom" colspan="12"><font style="font-size:8pt"><b>Nine months ended March 31,</b></font></td>
<td align="center" valign="bottom"><font style="font-size:8pt"><b>&nbsp;</b></font></td> </tr>
<tr>
<td align="center" valign="bottom"><font style="font-size:8pt"><b>&nbsp;</b></font></td>
<td align="center" valign="bottom" colspan="12"><hr size="1" width="100%" color="black" noshade></td>
<td align="center" valign="bottom"><font style="font-size:8pt"><b>&nbsp;</b></font></td>
<td align="center" valign="bottom"><font style="font-size:8pt"><b>&nbsp;</b></font></td>
<td align="center" valign="bottom" colspan="12"><hr size="1" width="100%" color="black" noshade></td>
<td align="center" valign="bottom"><font style="font-size:8pt"><b>&nbsp;</b></font></td> </tr>
<tr>
<td align="center" valign="bottom"><font style="font-size:8pt"><b>&nbsp;</b></font></td>
<td align="center" valign="bottom" colspan="5"><font style="font-size:8pt"><b>&nbsp;</b></font><font style="font-size:8pt"><b>2003</b></font><font style="font-size:8pt"><b>&nbsp;</b></font><font style="font-size:8pt"><b>&nbsp;</b></font><font
style="font-size:8pt"><b>&nbsp;</b></font></td>
<td align="center" valign="bottom"><font style="font-size:8pt"><b>&nbsp;</b></font></td>
<td align="center" valign="bottom"><font style="font-size:8pt"><b>&nbsp;</b></font></td>
<td align="center" valign="bottom" colspan="5"><font style="font-size:8pt"><b>&nbsp;</b></font><font style="font-size:8pt"><b>2002</b></font><font style="font-size:8pt"><b>&nbsp;</b></font><font style="font-size:8pt"><b>&nbsp;</b></font><font
style="font-size:8pt"><b>&nbsp;</b></font></td>
<td align="center" valign="bottom"><font style="font-size:8pt"><b>&nbsp;</b></font></td>
<td align="center" valign="bottom"><font style="font-size:8pt"><b>&nbsp;</b></font></td>
<td align="center" valign="bottom" colspan="5"><font style="font-size:8pt"><b>&nbsp;</b></font><font style="font-size:8pt"><b>2003</b></font><font style="font-size:8pt"><b>&nbsp;</b></font><font style="font-size:8pt"><b>&nbsp;</b></font><font
style="font-size:8pt"><b>&nbsp;</b></font></td>
<td align="center" valign="bottom"><font style="font-size:8pt"><b>&nbsp;</b></font></td>
<td align="center" valign="bottom"><font style="font-size:8pt"><b>&nbsp;</b></font></td>
<td align="center" valign="bottom" colspan="5"><font style="font-size:8pt"><b>&nbsp;</b></font><font style="font-size:8pt"><b>2002</b></font><font style="font-size:8pt"><b>&nbsp;</b></font><font style="font-size:8pt"><b>&nbsp;</b></font><font
style="font-size:8pt"><b>&nbsp;</b></font></td>
<td align="center" valign="bottom"><font style="font-size:8pt"><b></b></font></td> </tr>
<tr>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="5"> <hr size="1" width="100%" color="black" noshade> </td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="5"> <hr size="1" width="100%" color="black" noshade> </td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="5"> <hr size="1" width="100%" color="black" noshade> </td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="5"> <hr size="1" width="100%" color="black" noshade> </td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr bgcolor="#cceeff">
<td valign="bottom"><font style="font-size:10pt">Supplier 1</font></td>
<td valign="bottom"><font style="font-size:10pt">$</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">2,637</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">39</font></td>
<td valign="bottom"><font style="font-size:10pt">%</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">$</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">(a</font></td>
<td valign="bottom"><font style="font-size:10pt">)</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">&#151;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">$</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">5,800</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">35</font></td>
<td valign="bottom"><font style="font-size:10pt">%</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">$</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">(a</font></td>
<td valign="bottom"><font style="font-size:10pt">)</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">&#151;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr>
<td valign="bottom"><font style="font-size:10pt">Supplier 2</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">(a</font></td>
<td valign="bottom"><font style="font-size:10pt">)</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">&#151;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">(a</font></td>
<td valign="bottom"><font style="font-size:10pt">)</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">&#151;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">1,654 </font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">10</font></td>
<td valign="bottom"><font style="font-size:10pt">%</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt"> (a</font></td>
<td valign="bottom"><font style="font-size:10pt">)</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">&#151;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr bgcolor="#cceeff">
<td valign="bottom"><font style="font-size:10pt">Supplier 3</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">(a</font></td>
<td valign="bottom"><font style="font-size:10pt">)</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">&#151;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">2,514</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">36</font></td>
<td valign="bottom"><font style="font-size:10pt">%</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">(a</font></td>
<td valign="bottom"><font style="font-size:10pt">)</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">&#151;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">5,227</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">33</font></td>
<td valign="bottom"><font style="font-size:10pt">%</font></td> </tr>
<tr>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"> <hr size="1" width="100%" color="black" noshade> </td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"> <hr size="1" width="100%" color="black" noshade> </td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"> <hr size="1" width="100%" color="black" noshade> </td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"> <hr size="1" width="100%" color="black" noshade> </td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"> <hr size="1" width="100%" color="black" noshade> </td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"> <hr size="1" width="100%" color="black" noshade> </td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"> <hr size="1" width="100%" color="black" noshade> </td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"> <hr size="1" width="100%" color="black" noshade> </td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr bgcolor="#cceeff">
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">$</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">2,637</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">39</font></td>
<td valign="bottom"><font style="font-size:10pt">%</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">$</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">2,514</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">36</font></td>
<td valign="bottom"><font style="font-size:10pt">%</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">$</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">7,454</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">45</font></td>
<td valign="bottom"><font style="font-size:10pt">%</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">$</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">5,227</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">33</font></td>
<td valign="bottom"><font style="font-size:10pt">%</font></td> </tr>
<tr>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"> <hr size="3" width="100%" color="black" noshade> </td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"> <hr size="3" width="100%" color="black" noshade> </td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"> <hr size="3" width="100%" color="black" noshade> </td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"> <hr size="3" width="100%" color="black" noshade> </td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"> <hr size="3" width="100%" color="black" noshade> </td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"> <hr size="3" width="100%" color="black" noshade> </td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"> <hr size="3" width="100%" color="black" noshade> </td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"> <hr size="3" width="100%" color="black" noshade> </td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td> </tr> </table> <p><font style="font-size:10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Purchases were less than 10% of total raw material purchases</font></p>
<p><font style="font-size:10pt">Accounts payable to suppliers representing 10% or more of raw material purchases for the third quarter of fiscal 2003, was $583,000 and zero at March 31, 2003 and June 30, 2002, respectively.</font></p> <p
align="center"><font style="font-size:10pt">8</font></p>

<p Style='page-break-before:always'>
<HR  SIZE="3" COLOR="#999999" WIDTH="100%" ALIGN="CENTER">
  <p align="center"><font style="font-size:10pt"><b>NATURAL ALTERNATIVES INTERNATIONAL, INC.<br>NOTES TO UNAUDITED FINANCIAL STATEMENTS</b></font></p> <p><font style="font-size:10pt"><b>Note 3 &#150; Segment
Information</b></font></p> <p><font style="font-size:10pt">The Company&#146;s information by geographic area was as follows (dollars in thousands):</font></p>
<table border="0" cellspacing="0" width="100%">
<tr>
<td width="55%" align="center" valign="bottom"><font style="font-size:10pt"><b></b></font></td>
<td width="1%" valign="bottom"><font style="font-size:10pt"></font></td>
<td width="8%" align="right" valign="bottom"><font style="font-size:10pt"></font></td>
<td width="3%" valign="bottom"><font style="font-size:10pt"></font></td>
<td width="1%" valign="bottom"><font style="font-size:10pt"></font></td>
<td width="8%" align="right" valign="bottom"><font style="font-size:10pt"></font></td>
<td width="3%" valign="bottom"><font style="font-size:10pt"></font></td>
<td width="1%" valign="bottom"><font style="font-size:10pt"></font></td>
<td width="8%" align="right" valign="bottom"><font style="font-size:10pt"></font></td>
<td width="3%" valign="bottom"><font style="font-size:10pt"></font></td>
<td width="1%" valign="bottom"><font style="font-size:10pt"></font></td>
<td width="8%" align="center" valign="bottom"><font style="font-size:10pt"></font><font style="font-size:10pt"><b></b></font></td> </tr>
<tr>
<td align="center" valign="bottom"><font style="font-size:8pt"><b>&nbsp;</b></font></td>
<td align="center" valign="bottom" colspan="5"><font style="font-size:8pt"><b>Net Sales for the <br>Three months ended <br>March 31,</b></font></td>
<td align="center" valign="bottom"><font style="font-size:8pt"><b>&nbsp;</b></font></td>
<td align="center" valign="bottom" colspan="5"><font style="font-size:8pt"><b>Net Sales for the <br>Nine months ended <br>March 31,</b></font></td> </tr>
<tr>
<td align="center" valign="bottom"><font style="font-size:8pt"><b>&nbsp;</b></font></td>
<td align="center" valign="bottom" colspan="5"><hr size="1" width="100%" color="black" noshade></td>
<td align="center" valign="bottom"><font style="font-size:8pt"><b>&nbsp;</b></font></td>
<td align="center" valign="bottom" colspan="5"><hr size="1" width="100%" color="black" noshade></td> </tr>
<tr>
<td align="center" valign="bottom"><font style="font-size:8pt"><b>&nbsp;</b></font></td>
<td align="center" valign="bottom" colspan="2"><font style="font-size:8pt"><b>2003</b></font></td>
<td align="center" valign="bottom"><font style="font-size:8pt"><b>&nbsp;</b></font></td>
<td align="center" valign="bottom" colspan="2"><font style="font-size:8pt"><b>2002</b></font></td>
<td align="center" valign="bottom"><font style="font-size:8pt"><b>&nbsp;</b></font></td>
<td align="center" valign="bottom" colspan="2"><font style="font-size:8pt"><b>2003</b></font></td>
<td align="center" valign="bottom"><font style="font-size:8pt"><b>&nbsp;</b></font></td>
<td align="center" valign="bottom" colspan="2"><font style="font-size:8pt"><b>2002</b></font></td> </tr>
<tr>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"><hr size="1" width="100%" color="black" noshade></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"><hr size="1" width="100%" color="black" noshade></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"><hr size="1" width="100%" color="black" noshade></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"><hr size="1" width="100%" color="black" noshade></td> </tr>
<tr bgcolor="#cceeff">
<td valign="bottom"><font style="font-size:10pt">United States</font></td>
<td valign="bottom"><font style="font-size:10pt">$</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">12,238</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">$</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">11,010</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">$</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">34,577</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">$</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">29,994</font></td> </tr>
<tr>
<td valign="bottom"><font style="font-size:10pt">International</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">1,517</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">1,833</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">5,324</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">5,391</font></td> </tr>
<tr>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"><hr size="1" width="100%" color="black" noshade></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"><hr size="1" width="100%" color="black" noshade></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"><hr size="1" width="100%" color="black" noshade></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"><hr size="1" width="100%" color="black" noshade></td> </tr>
<tr bgcolor="#cceeff">
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">$</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">13,755</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">$</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">12,843</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">$</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">39,901</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">$</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">35,385</font></td> </tr>
<tr>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"><hr size="3" width="100%" color="black" noshade></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"><hr size="3" width="100%" color="black" noshade></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"><hr size="3" width="100%" color="black" noshade></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"><hr size="3" width="100%" color="black" noshade></td> </tr> </table> <p></p>
<table border="0" cellspacing="0" width="100%">
<tr>
<td width="55%" align="center" valign="bottom"><font style="font-size:10pt"><b></b></font></td>
<td width="1%" valign="bottom"><font style="font-size:10pt"></font></td>
<td width="8%" align="right" valign="bottom"><font style="font-size:10pt"></font></td>
<td width="3%" valign="bottom"><font style="font-size:10pt"></font></td>
<td width="1%" valign="bottom"><font style="font-size:10pt"></font></td>
<td width="8%" align="right" valign="bottom"><font style="font-size:10pt"></font></td>
<td width="3%" valign="bottom"><font style="font-size:10pt"></font></td>
<td width="1%" valign="bottom"><font style="font-size:10pt"></font></td>
<td width="8%" align="right" valign="bottom"><font style="font-size:10pt"></font></td>
<td width="3%" valign="bottom"><font style="font-size:10pt"></font></td>
<td width="1%" valign="bottom"><font style="font-size:10pt"></font></td>
<td width="8%" align="center" valign="bottom"><font style="font-size:10pt"></font><font style="font-size:10pt"><b></b></font></td> </tr>
<tr>
<td align="center" valign="bottom"><font style="font-size:8pt"><b>&nbsp;</b></font></td>
<td align="center" valign="bottom" colspan="5"><font style="font-size:8pt"><b>Long Lived Assets</b></font></td>
<td align="center" valign="bottom"><font style="font-size:8pt"><b>&nbsp;</b></font></td>
<td align="center" valign="bottom" colspan="5"><font style="font-size:8pt"><b>Total Assets</b></font></td> </tr>
<tr>
<td align="center" valign="bottom"><font style="font-size:8pt"><b>&nbsp;</b></font></td>
<td align="center" valign="bottom" colspan="5"> <hr size="1" width="100%" color="black" noshade> </td>
<td align="center" valign="bottom"><font style="font-size:8pt"><b>&nbsp;</b></font></td>
<td align="center" valign="bottom" colspan="5"> <hr size="1" width="100%" color="black" noshade> </td> </tr>
<tr>
<td align="center" valign="bottom"><font style="font-size:8pt"><b>&nbsp;</b></font></td>
<td align="center" valign="bottom" colspan="2"><font style="font-size:8pt"><b>March 31, <br> 2003</b></font></td>
<td align="center" valign="bottom"><font style="font-size:8pt"><b>&nbsp;</b></font></td>
<td align="center" valign="bottom" colspan="2"><font style="font-size:8pt"><b>June 30,<br> 2002</b></font></td>
<td align="center" valign="bottom"><font style="font-size:8pt"><b>&nbsp;</b></font></td>
<td align="center" valign="bottom" colspan="2"><font style="font-size:8pt"><b>March 31, <br> 2003</b></font></td>
<td align="center" valign="bottom"><font style="font-size:8pt"><b>&nbsp;</b></font></td>
<td align="center" valign="bottom" colspan="2"><font style="font-size:8pt"><b>June 30, <br> 2002</b></font></td> </tr>
<tr>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"><hr size="1" width="100%" color="black" noshade></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"><hr size="1" width="100%" color="black" noshade></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"><hr size="1" width="100%" color="black" noshade></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"><hr size="1" width="100%" color="black" noshade></td> </tr>
<tr bgcolor="#cceeff">
<td valign="bottom"><font style="font-size:10pt">United States</font></td>
<td valign="bottom"><font style="font-size:10pt">$</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">10,338</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">$</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">11,450</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">$</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">26,245</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">$</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">24,290</font></td> </tr>
<tr>
<td valign="bottom"><font style="font-size:10pt">International</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">1,448</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">1,527</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">3,567</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">3,220</font></td> </tr>
<tr>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"><hr size="1" width="100%" color="black" noshade></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"><hr size="1" width="100%" color="black" noshade></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"><hr size="1" width="100%" color="black" noshade></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"><hr size="1" width="100%" color="black" noshade></td> </tr>
<tr bgcolor="#cceeff">
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">$</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">11,786</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">$</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">12,977</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">$</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">29,812</font></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="bottom"><font style="font-size:10pt">$</font></td>
<td align="right" valign="bottom"><font style="font-size:10pt">27,510</font></td> </tr>
<tr>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"><hr size="3" width="100%" color="black" noshade></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"><hr size="3" width="100%" color="black" noshade></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"><hr size="3" width="100%" color="black" noshade></td>
<td valign="bottom"><font style="font-size:10pt">&nbsp;</font></td>
<td align="right" valign="bottom" colspan="2"><hr size="3" width="100%" color="black" noshade></td> </tr> </table> <p><font style="font-size:10pt"><b>Note 4 - Financial Condition</b></font></p> <p><font style="font-size:10pt">On October 31, 2002,
the Company entered into a new $6.5 million two-year credit facility. The facility is comprised of a $4 million working capital line of credit and a $2.5 million term loan. The working capital line of credit is subject to eligibility requirements
for current accounts receivable and inventory balances. As of March 31, 2003 the Company had $3.8 million available under the line of credit. The interest rate on the line of credit and term loan is prime plus 0.5%. As of March 31, 2003, the
outstanding amount on the line of credit was zero. The term loan provides for principal and interest payable in monthly installments of $47,000 with a final balloon payment of $1.6 million on the second anniversary of the loan agreement. As of March
31, 2003 the outstanding amount was $2.3 million.</font></p> <p><font style="font-size:10pt">On May 2, 1996, the Company entered into a term note agreement for $1.1 million, secured by a building, at an annual interest rate of 8.25%. The note is due
in June 2011 and provides for principal and interest payable in monthly installments of $10,800. As of March 31, 2003, the outstanding amount was $765,000.</font></p> <p><font style="font-size:10pt">The composite interest rate on all outstanding
debt at March 31, 2003 and 2002 was 6.74% and 9.82%, respectively.</font></p> <p><font style="font-size:10pt"><b>Note 5 - Contingencies</b></font></p> <p><font style="font-size:10pt">The Company was a plaintiff in an antitrust lawsuit against
several manufacturers of vitamins and other raw materials purchased by the Company. Other similarly situated companies filed a number of similar lawsuits against some or all of the same manufacturers. The Company&#146;s lawsuit was consolidated with
some of the others and captioned <i>In re: Vitamin Antitrust Litigation</i>, and was pending in U.S. District Court in Washington D.C. A final settlement payment of $225,000 and a payment of $1,000,000 were received by the Company and are included
in proceeds from vitamin antitrust litigation in the accompanying statements of operations for the nine months ended March 31, 2003 and 2002, respectively. Settlement payments received by the Company of $0 and $1,000,000 are included in proceeds
from vitamin antitrust litigation in the accompanying statements of operations for the three months ended Mach 31, 2003 and 2002, respectively. All of its claims under the <i>Vitamin Antitrust Litigation</i> were settled.</font></p> <p
align="center"><font style="font-size:10pt">9</font></p>

<p Style='page-break-before:always'>
<HR  SIZE="3" COLOR="#999999" WIDTH="100%" ALIGN="CENTER">
  <p><font style="font-size:10pt">From time to time the Company may be subject to various claims and legal actions arising in the ordinary course of business. In the opinion of management, after consultation with its
legal counsel, there are no outstanding matters that are expected to have a material adverse effect on the Company&#146;s consolidated financial position, results of operations or liquidity.</font></p>
<table border="0" cellspacing="0" width="100%">
<tr>
<td width="5%" valign="top"><font style="font-size:10pt"><b></b></font></td>
<td width="95%" valign="top"><font style="font-size:10pt"><b></b></font></td> </tr>
<tr>
<td valign="top" nowrap><font style="font-size:10pt"><b>Item 2.</b></font></td>
<td valign="top"><font style="font-size:10pt"><b> Management&#146;s Discussion and Analysis of Financial Condition and Results of Operations</b></font></td> </tr> </table><p><font style="font-size:10pt"><b>Certain Forward-Looking
Information</b></font></p> <p><font style="font-size:10pt">Information provided in this Quarterly Report on Form 10-Q may contain forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934 that are not
historical facts and information. These statements represent the Company&#146;s expectations or beliefs, including, but not limited to, statements concerning future financial and operating results, statements concerning industry performance, the
Company&#146;s operations, economic performance, financial condition, margins and growth in sales of the Company&#146;s products, capital expenditures, financing needs, as well as assumptions related to the foregoing. For this purpose, any
statements contained in this Quarterly Report that are not statements of historical fact may be deemed to be forward-looking statements. Without limiting the generality of the foregoing, words such as &#147;may,&#148; &#147;will,&#148;
&#147;expect,&#148; &#147;believe,&#148; &#147;anticipate,&#148; &#147;intend,&#148; &#147;could,&#148; &#147;estimate&#148; or &#147;continue&#148; or the negative or other variations thereof or comparable terminology are intended to identify
forward-looking statements. These forward-looking statements are based on current expectations and involve various risks and uncertainties that could cause actual results and outcomes for future periods to differ materially from any forward-looking
statement or views expressed herein. The Company&#146;s financial performance and the forward-looking statements contained herein are further qualified by other risks including but not limited to those set forth herein and in the Company&#146;s most
recent Annual Report on Form 10-K.</font></p> <p><font style="font-size:10pt"><b>Critical Accounting Policies and Estimates</b></font></p> <p><font style="font-size:10pt">The Company&#146;s discussion and analysis of its financial condition and
results of operations is based upon its consolidated financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States. The preparation of these financial statements requires the Company
to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses, and related disclosure of contingent assets and liabilities. On an on-going basis, the Company evaluates the estimates including those
related to bad debts and inventories. The Company bases its estimates on historical experience and on various other assumptions that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments
about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates.</font></p> <p><font style="font-size:10pt">The Company believes the following critical accounting
policies affect the more significant judgments and estimates used in the preparation of the consolidated financial statements:</font></p> <p><font style="font-size:10pt">Allowance for Doubtful Accounts &#150; the Company maintains an allowance for
doubtful accounts for estimated losses resulting from the inability of its customers to make required payments. If the financial condition of the Company&#146;s customers were to deteriorate, resulting in an impairment of their ability to make
payments, additional allowance may be required.</font></p> <p><font style="font-size:10pt">Reserve for Inventory &#150; the Company records valuation reserves on its inventory for estimated excess and obsolete inventory equal to the difference
between the cost of inventory and the estimated market value based upon assumptions about future product demand and market conditions. If future product demand or market conditions are less favorable than those projected by management, additional
inventory reserves may be required.</font></p> <p align="center"><font style="font-size:10pt">10</font></p>

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  <p><font style="font-size:10pt">Depreciation of Long-Lived Assets &#150; the Company assigns useful lives for long-lived assets based on periodic studies of actual asset lives and the intended use for those assets.
Any change in these asset lives would be reported in the statement of operations as soon as any change in estimate is determined.</font></p> <p><font style="font-size:10pt">Accounting for Income Taxes &#150; the Company is required to estimate
income taxes in each of the jurisdictions in which it operates. This process involves estimating actual current tax exposure for the Company together with assessing temporary differences resulting from differing treatment of items, such as property,
plant and equipment depreciation, for tax and financial reporting purposes. Actual income taxes could vary from these estimates due to future changes in income tax law or results from final tax exam reviews. At March 31, 2003, the Company assessed
the need for a valuation allowance on its deferred tax assets. A valuation allowance is provided when it is more likely than not that some portion or all of the deferred tax assets will not be realized. Based upon the historical operating losses and
the uncertainty regarding sufficient near term taxable income, management believes that this evidence creates sufficient uncertainty regarding the realizability of the net deferred tax assets. Therefore, a full valuation allowance is recorded at
March 31, 2003. Should the Company determine that it would be able to realize all or part of its net deferred tax assets in the future, an adjustment to the deferred tax assets would be recorded to operations in the period such determination was
made.</font></p> <p><font style="font-size:10pt"><b>RESULTS OF OPERATIONS</b></font></p> <p><font style="font-size:10pt">Natural Alternatives International, Inc. and its subsidiary (referred to collectively herein as &#147;NAI&#148; or the
&#147;Company&#148;) are engaged in the formulation, manufacturing and packaging of encapsulated and compressed tablets and powder blended vitamins and related nutritional supplements including phytochemicals derived from botanicals and foods. The
Company provides private label contract manufacturing services to various companies engaged in the marketing and distribution of vitamins, mineral supplements, herbs and other health and nutrition consumer products (&#147;core
business&#148;).</font></p> <p><font style="font-size:10pt">In fiscal 2001, the Company introduced its direct-to-consumer (&#147;DTC&#148;) business with the launch of Dr. Cherry&#146;s Pathway to Healing&#153; product line. This product line, which
is primarily marketed through television media, has grown to include fifteen products and comprises all of the Company&#146;s DTC sales through the third quarter of fiscal 2003. During the fiscal third quarter, the Company announced the signing of
an exclusive worldwide licensing agreement with Jennifer O&#146;Neill and developed the Jennifer O&#146;Neill Signature Line&#153; (&#147;Signature Line&#148;) of health and beauty care products. The Signature Line will be available for sale in the
fourth quarter of fiscal 2003.</font></p> <p><font style="font-size:10pt">The Company&#146;s strategy continues to focus on increasing revenues in both its core and DTC business lines. Growth in the core business is anticipated from serving its
primary core customers, developing new relationships with other strong prospective core customers both internationally and domestically and pursuing strategic partnerships for the development and marketing of proprietary products. Development in the
DTC business is expected from expanding the existing product lines, marketing the existing product lines in additional television markets and securing additional licensors.</font></p> <p><font style="font-size:10pt">The Company anticipates
successful execution of its strategies to produce near term consistent operating profitability resulting from moderate sales growth that will be partially offset by increasing costs for DTC brand development and licensor acquisition efforts. The
growth in the core business is dependent upon many factors including maintaining and improving the satisfaction of our current core customers, obtaining orders for new products from current core customers, obtaining additional volumes on existing
products from current core customers and securing new core customers. The growth in the DTC business is dependent upon the market acceptance of Dr. Cherry and Jennifer O&#146;Neill, effectiveness of media placement and the performance of the
outsourced call center. The Company&#146;s ability to maintain consistent operating profitability could be adversely affected by several factors that are discussed below in <i>Risk Factors That May Affect Future Operations Results.</i></font></p> <p
align="center"><font style="font-size:10pt">11</font></p>

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  <p><font style="font-size:10pt"><b>Third Quarter Fiscal 2003 (&#147;fiscal 2003&#148;) <br>versus Third Quarter Fiscal 2002 (&#147;fiscal 2002&#148;)</b></font></p> <p><font style="font-size:10pt">Consolidated net
sales increased 7% to $13.8 million from $12.8 million for the comparable quarter last year. The consolidated net sales growth resulted from a $478,000, or 24%, increase in DTC sales and a $434,000, or 4%, increase in core sales. The growth in DTC
sales to $2.5 million from $2.0 million for the comparable quarter last year is primarily due to five additional product offerings. The DTC line of business represented 18% of consolidated net sales for the third quarter of fiscal 2003 compared to
16% for the comparable quarter last year. Core sales increased to $11.3 from $10.8 million for the comparable quarter last year. </font></p> <p><font style="font-size:10pt">Gross profit margin increased to 23.9% from 22.5% for the comparable quarter
last year. The increase in gross profit margin is primarily due to improvement in fixed cost leverage resulting from additional sales volumes. Material cost as a percent of net sales increased slightly to 52.9% from 52.0% for the comparable quarter
last year. The increase in material cost as a percent of net sales was primarily due to a shift in product mix, partially offset by lower pricing from our primary vendors.</font></p> <p><font style="font-size:10pt">Selling, general and
administrative expenses (&#147;SG&#38;A&#148;) increased 4% to $3.1 million from $2.9 million for the comparable quarter last year. The increase of $130,000 is primarily due to increases in DTC fulfillment and recurring media costs of $128,000
associated with incremental sales, new DTC media and production costs of $264,000 for introducing Dr. Cherry&#146;s Pathway to Healing&#153; brand in several new television markets, sales and executive personnel costs of $50,000, insurance premiums
of $80,000, research and development personnel costs of $150,000, clinical study costs of $25,000 and information systems costs of $40,000. These increases were partially offset by a $150,000 reduction in employee separation expenses and $500,000
reduction of DTC costs incurred in the prior year for correcting customer service, processing and reporting issues caused by a third party DTC call and fulfillment center that was replaced in December 2001. </font></p> <p><font
style="font-size:10pt">Income from operations was $211,000 compared to a loss from operations of ($59,000) for the comparable quarter last year. The increase in income from operations of $270,000 was due primarily to improved gross margin on higher
net sales, partially offset by the incremental SG&#38;A expenses discussed above. </font></p> <p><font style="font-size:10pt">Proceeds from the <i>Vitamin Antitrust Litigation</i> were $0 and $1.0 million for the three months ended March 31, 2003
and 2002, respectively.</font></p> <p><font style="font-size:10pt"><b>First Nine Months of Fiscal 2003 (&#147;fiscal 2003&#148;) <br>versus First Nine Months of Fiscal 2002 (&#147;fiscal 2002&#148;)</b></font></p> <p><font
style="font-size:10pt">Consolidated net sales increased 13% to $39.9 million from $35.4 million for the comparable period last year. The consolidated net sales growth resulted from a $2.8 million or 9% increase in core sales and a $1.8 million or
30% increase in DTC sales. The growth in core sales to $32.4 million from $29.6 million for the comparable period of the prior year is primarily due to new products sold to existing major core customers. The growth in DTC sales to $7.5 million from
$5.8 million for the comparable period of the prior year is primarily due to five additional product offerings. The DTC line of business represented 19% of consolidated net sales compared to 16% for the same period of the prior year. </font></p>
<p><font style="font-size:10pt">Gross profit margin increased to 23.9% from 21.5% for the comparable period last year. The increase in gross profit margin is primarily due to improvement in fixed cost leverage resulting from additional sales
volumes. Material cost as a percent of net sales remained consistent at 52% for the nine months ended fiscal 2003 and fiscal 2002. </font></p> <p><font style="font-size:10pt">SG&#38;A increased 10% to $8.7 million from $7.9 million for the
comparable period last year. The increase of $804,000 is primarily due to increases in DTC fulfillment and recurring media costs of $431,000 associated with incremental sales, new DTC media and production costs of $264,000 for introducing Dr.
Cherry&#146;s Pathway to Healing&#153; brand in several new television markets, sales and executive personnel costs of $350,000, research and development personnel costs of $300,000, insurance premiums of $270,000, information systems costs of
$140,000 and clinical study costs of $115,000. These increases were partially offset by a $350,000 reduction in legal costs, $300,000 reduction in employee separation </font></p> <p align="center"><font style="font-size:10pt">12</font></p>

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  <p><font style="font-size:10pt">expenses, and $500,000 reduction of DTC costs incurred in the prior year for correcting customer service, processing and reporting issues caused by a third party DTC call and
fulfillment center that was replaced in December 2001. Overall, SG&#38;A decreased as a percentage of net sales to 21.7% from 22.2% in the comparable period last year.</font></p> <p><font style="font-size:10pt">Income from operations was $869,000
compared to a loss from operations of ($244,000) for the comparable period last year. The increase in income from operations was due primarily to improved gross margin on higher net sales, partially offset by the incremental SG&#38;A expenses
discussed above. </font></p> <p><font style="font-size:10pt">Proceeds from vitamin antitrust litigation were $225,000 and $1,000,000 for the nine months ended March 31, 2003 and 2002, respectively. Proceeds received in fiscal 2003 represent the
final settlement payment from the <i>Vitamin Antitrust Litigation</i>.</font></p> <p><font style="font-size:10pt"><b>LIQUIDITY AND CAPITAL RESOURCES</b></font></p> <p><font style="font-size:10pt">Cash flows provided by operating activities were $1.7
million for the first nine months of fiscal 2003 compared to $1.0 million for the comparable period last year. Operating cash flow increased primarily due to an increase in net income from $858,000 in the current fiscal year compared to $165,000 in
the comparable period last year plus an increase in current assets of $1.4 million for the currrent fiscal year compared to an increase in current assets of $2.9 million in the comparable period last year. These increases were partially offset by an
increase in current liabilities of $487,000 in the current fiscal year compared to an increase in current liabilities of $2.0 million in the comparable period last year.</font></p> <p><font style="font-size:10pt">At March 31, 2003, the Company had
cash and working capital of $4.2 million and $11.8 million, respectively, compared to $640,000 and $8.7 million, respectively, at June 30, 2002. The improvement in working capital is primarily due to the $1.7 million of operating cash flow generated
during the first nine months ended March 31, 2003 and the $1.3 million from refinancing the credit facility.</font></p> <p><font style="font-size:10pt">On October 31, 2002, the Company entered into a new $6.5 million two-year credit facility. The
facility is comprised of a $4 million working capital line of credit and a $2.5 million term loan. The working capital line of credit is subject to eligibility requirements for current accounts receivable and inventory balances. As of March 31, 2003
the Company had $3.8 million available under the line of credit. The interest rate on the line of credit and term loan is prime plus 0.5%. The new facility replaced the $2.5 million line of credit that expired on October 31, 2002, and refinanced the
$1.2 million outstanding term note. The new credit facility provided a $1.3 million increase in the Company&#146;s cash position, freed up $1.5 million of cash previously restricted as collateral for the prior line of credit and provided an
additional $1.5 million of borrowing capacity.</font></p> <p><font style="font-size:10pt">The Company believes that its available cash and existing credit facility should be sufficient to fund near-term operating activities. However, the
Company&#146;s ability to fund future operations and meet capital requirements will depend on many factors, including but not limited to: continued profitability from operations, maintaining adequate financing, the effectiveness of the
Company&#146;s diversified growth strategy, the effectiveness of the expansion of European operations, the ability to establish additional customers and changes to existing customers&#146; business.</font></p> <p><font style="font-size:10pt"><b>RISK
FACTORS THAT MAY AFFECT FUTURE OPERATING RESULTS</b></font></p> <p><font style="font-size:10pt"><i>In addition to the other information included in this Report, the following factors should be considered in evaluating the Company&#146;s business and
future prospects. The Company&#146;s business and results of operations could be seriously harmed by any of the following risks. In addition, the market price of our common stock could decline due to any of these risks.</i></font></p> <p><font
style="font-size:10pt"><b><u>Recent Operating Income; Increasing Sales</u></b></font></p> <p><font style="font-size:10pt">The Company&#146;s income from operations increased to $869,000 for the nine months ended March 31, 2003, compared to a loss
from operation of ($244,000) for the same period last year. Sales for the nine months ended March 31, 2003 increased to $39.9 million compared to $35.4 million for the same period last year. There can be no assurance that increases in income from
operations will continue or that the Company will have net income from operations and not a net loss in future periods. </font></p> <p align="center"><font style="font-size:10pt">13</font></p>

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  <p><font style="font-size:10pt">The Company expects operating results may further fluctuate from period to period as a result of differences in when it incurs expenses and recognizes revenues from product sales. Some
of these fluctuations may be significant.</font></p> <p><font style="font-size:10pt"><b><u>Reliance on Limited Number of Customers</u></b></font></p><p><font style="font-size:10pt">For the nine months ended March 31, 2003, the Company had two major
customers, which together accounted for approximately 70% of the Company&#146;s net sales. The loss of either of these major customers, or any substantial reduction of their purchases from the Company, would have a material adverse impact on the
business, operations and financial condition of the Company.</font></p> <p><font style="font-size:10pt"><b><u>Reliance on a Key Personality</u></b></font></p><p><font style="font-size:10pt">For the nine months ended March 31, 2003, the
Company&#146;s DTC product line was approximately 19% of the Company&#146;s net sales. DTC products are marketed with a key personality through a variety of distribution channels including weekly television programming, internet and a monthly
newsletter. The inability of the key personality to fulfill his current role, or the reduction of television or other media exposure could have a material adverse impact on the business, operations and financial condition of the Company.</font></p>
<p><font style="font-size:10pt"><b><u>Potential for Increased Competition</u></b></font></p><p><font style="font-size:10pt">The market for the Company&#146;s products is highly competitive. The Company competes with other dietary supplement products
and over-the-counter pharmaceutical manufacturers. Among other factors, competition among these manufacturers is based upon price. If one or more manufacturers significantly reduce their prices in an effort to gain market share, the Company&#146;s
business, operations and financial condition could be adversely affected. Many of the Company&#146;s competitors, particularly manufacturers of nationally advertised brand name products, are larger and have resources substantially greater than those
of the Company. There has been speculation about the potential for increased participation in these markets by major international pharmaceutical companies. In the future, if not already, one or more of these companies could seek to compete more
directly with the Company by manufacturing and distributing their own or others&#146; products, or by significantly lowering the prices of existing national brand products. The Company sells substantially all of its supplement products to customers
who re-sell and distribute the products. Although the Company does not currently participate significantly in other channels such as health food stores, direct mail, and internet sales, the Company is expanding its operations and its products,
including direct mail and internet sales, and will likely face increased competition in such distribution and sales channels as more vendors and customers utilize them.</font></p> <p><font style="font-size:10pt"><b><u>Availability of Line of
Credit</u></b></font></p><p><font style="font-size:10pt">Effective October 31, 2002, the Company entered into a new $6.5 million two-year credit facility. The liquidity provided by a line of credit is an important component of a sound financial
management plan. Failure to maintain the loan covenants required to allow the Company continuing access to this new line of credit could materially impair the Company&#146;s ability to fund growth in operations or meet other working capital needs in
the future.</font></p> <p><font style="font-size:10pt"><b><u>Reliance on Limited Number of Suppliers; Availability and Cost of Purchased Materials</u></b></font></p><p><font style="font-size:10pt">The Company purchases certain products it does not
manufacture from a limited number of raw material suppliers. For the nine months ended March 31, 2003, the Company had two major suppliers, which together accounted for 45% of raw material purchases. No other supplier represented more than 10% of
total raw material purchases for the nine months ended March 31, 2003. Although the Company currently has supply arrangements with several suppliers of these raw materials, and such materials are generally available from numerous sources, the
termination of the supply relationship by any material supplier or an unexpected interruption of supply could materially adversely affect the Company&#146;s business, operations and financial condition.</font></p> <p><font style="font-size:10pt">The
Company relies on a single supplier to process certain raw materials for a product line of the Company&#146;s largest customer. An unexpected interruption of supply of this service would materially adversely affect the Company&#146;s business,
operations and financial condition.</font></p> <p align="center"><font style="font-size:10pt">14</font></p>

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  <p><font style="font-size:10pt"><b><u>Decline in Stock Price </u></b></font></p><p><font style="font-size:10pt">The Company&#146;s stock price has experienced volatility, during the past few years. In view of the
Company&#146;s recent results and the fact there can be no assurances of future profitability, there can be no assurance that the stock price will not decline. Market conditions in the vitamin and nutritional supplement industry, such as increased
price competition, consolidation, oversupply of vitamin and supplement products, operating results of competitors, adverse publicity and other factors such as customer and product announcements by the Company or operating results which are lower
than the expectations of analysts and our investors, may have an adverse effect on the price of the Company&#146;s stock.</font></p> <p><font style="font-size:10pt"><b><u>Effect of Adverse Publicity</u></b></font></p><p><font
style="font-size:10pt">The Company&#146;s products consist primarily of dietary supplements (vitamins, minerals, herbs and other ingredients). The Company regards these products as safe when taken as suggested by the Company. In addition, various
scientific studies have suggested the ingredients in some of the Company&#146;s products may involve health benefits. The Company believes the growth in the dietary supplements business of the last several years may, in part, be based on significant
media attention and various scientific research suggesting potential health benefits from the consumption of certain vitamin products. The Company is indirectly dependent upon its customers&#146; perception of the overall integrity of its business,
as well as the safety and quality of its products and similar products distributed by other companies that may not adhere to the same quality standards as the Company. The business, operations, and financial condition of the Company could be
adversely affected if any of the Company&#146;s products or any similar products distributed by other companies should prove or be asserted to be harmful to consumers, or should scientific studies provide unfavorable findings regarding the effect of
products similar to those produced by the Company.</font></p> <p><font style="font-size:10pt"><b><u>Exposure to Product Liability Claims</u></b></font></p><p><font style="font-size:10pt">The Company, like other retailers, distributors and
manufacturers of products that are ingested, faces a risk of exposure to product liability claims in the event that, among other things, the use of its products allegedly results in injury. The Company maintains product liability insurance coverage,
including primary product liability and excess liability coverage. The cost of such coverage has increased dramatically in the last year and the availability of adequate insurance coverage has decreased. There can be no assurance that adequate
product liability insurance will continue to be available at an economically reasonable cost or that the Company&#146;s insurance will be adequate to cover any liability the Company incurs in respect to all possible product liability claims. The
Company&#146;s product liability insurance includes certain exclusions and limitations, the Company&#146;s insurer could expand such exclusions or limitations on coverage in the future. In such event, the Company may have to cease utilizing the
ingredients or may have to rely on indemnification or similar arrangements with its customers who wish to continue to include such ingredients in their products. In such an event, the consequential increase in product liability risk or the loss of
customers or product lines could have a material adverse impact on the Company&#146;s business, operations, and financial condition.</font></p> <p><font style="font-size:10pt"><b><u>Risks Associated with International
Markets</u></b></font></p><p><font style="font-size:10pt">The Company&#146;s growth may be dependent in part upon its ability to expand its operations and those of its customers into new markets, including international markets. For the nine months
ended March 31, 2003 and 2002, the percentage of the Company&#146;s net sales to customers in international markets was approximately 25.4% and 28.6%, respectively. NAIE operates a manufacturing facility in Switzerland, which is intended to
facilitate an increase in sales of the Company&#146;s products overseas and which contributed approximately 13.3% and 15.2% of the Company&#146;s net sales for the nine months ended March 31, 2003 and 2002, respectively. The Company may experience
difficulty expanding in international markets due to regulatory barriers, the necessity of adapting to new regulatory systems, and problems related to entering new markets with different cultural bases and political systems. Operating in
international markets exposes the Company to certain risks, including, among other things, (1) changes in or interpretations of foreign import, currency transfer and other restrictions and regulations that among other things may limit the
Company&#146;s ability to sell certain products or repatriate profits to the United States, (2) exposure to currency fluctuations, (3) the potential imposition of trade or foreign exchange restrictions or increased tariffs, (4) economic and
political instability, and (5) the impact of various government&#146;s</font></p> <p align="center"><font style="font-size:10pt">15</font></p>

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  <p><font style="font-size:10pt"> regulations and the enforcement thereof. As the Company continues to expand its international operations, these and other risks associated with international operations are likely to
increase.</font></p> <p><font style="font-size:10pt"><b><u>Government Regulation</u></b></font></p><p><font style="font-size:10pt">The manufacturing, processing, formulation, packaging, labeling and advertising of the Company&#146;s products are
subject to regulation by one or more federal agencies, including the United States Food and Drug Administration (&#147;FDA&#148;), the Federal Trade Commission (&#147;FTC&#148;), the Consumer Product Safety Commission, the United States Department
of Agriculture, the United States Postal Service, the United States Environmental Protection Agency, and the Occupational Safety and Health Administration. The Company&#146;s activities are also regulated by various agencies of the states and
localities in which the Company&#146;s products are sold. In particular, the FDA regulates the safety, labeling and distribution of dietary supplements, including vitamins, minerals, herbs, food, and over-the-counter and prescription drugs and
cosmetics. In addition, the FTC has overlapping jurisdiction with the FDA to regulate the labeling, promotion and advertising of vitamins, over-the-counter drugs, cosmetics and foods.</font></p> <p><font style="font-size:10pt">The Dietary Supplement
Health and Education Act of 1994 (&#147;DSHEA&#148;) was enacted on October 25, 1994. DSHEA amends the Federal Food, Drug and Cosmetic Act by defining dietary supplements, which include vitamins, minerals, nutritional supplements and herbs as a new
category of food separate from conventional food. DSHEA provides a regulatory framework to ensure safe, quality dietary supplements and the dissemination of accurate information about such products. Under DSHEA, the FDA is generally prohibited from
regulating the active ingredients in dietary supplements as drugs unless product claims, such as claims that a product may heal, mitigate, cure or prevent an illness, disease or malady, trigger drug status.</font></p> <p><font
style="font-size:10pt">DSHEA provides for specific nutritional labeling requirements for dietary supplements. DSHEA permits substantiated, truthful and non-misleading statements of nutritional support to be made in labeling, such as statements
describing general well being resulting from consumption of a dietary ingredient or the role of a nutrient or dietary ingredient in affecting or maintaining a structure or function of the body. The Company anticipates the FDA will finalize
manufacturing process regulations that are specific to dietary supplements and require at least some of the quality control provisions applicable to drugs. The Company currently manufactures its vitamins and nutritional supplement products in
compliance with the food good manufacturing processes.</font></p> <p><font style="font-size:10pt">The FDA is developing additional regulations to implement DSHEA. Labeling regulations may require expanded or different labeling for the Company&#146;s
vitamin and nutritional products. The Company cannot determine what effect such regulations, when fully implemented, will have on its business in the future. Such regulations could, among other things, require the recall, reformulation or
discontinuance of certain products, additional record keeping, warnings, notification procedures and expanded documentation of the properties of certain products or scientific substantiation regarding ingredients, product claims, safety or efficacy.
Failure to comply with applicable FDA requirements could result in sanctions being imposed on the Company or the manufacturers of its products, including warning letters, fines, product recalls and seizures.</font></p> <p><font
style="font-size:10pt">Governmental regulations in foreign countries where the Company plans to commence or expand sales may prevent or delay entry into a market or prevent or delay the introduction, or require the reformulation of certain of the
Company&#146;s products. In addition, the Company cannot predict whether new domestic or foreign legislation regulating its activities will be enacted. Such new legislation could have a material adverse effect on the business, operations and
financial condition of the Company.</font></p> <p><font style="font-size:10pt"><b><u>Failure to Attract and Retain Management Could Harm Our Ability to Maintain Profitability</u></b></font></p><p><font style="font-size:10pt">The Company&#146;s
success is dependent in large part upon its continued ability to identify, hire, retain and motivate highly skilled management employees. Competition for these employees is intense, and the Company may not be able to hire additional qualified
personnel in a timely manner and on reasonable terms. The majority of the Company&#146;s current corporate officers began their employment with the Company in fiscal years 2002 and 2001. The inability of the Company to retain competent professional
management could adversely affect our ability to execute our business strategy.</font></p> <p align="center"><font style="font-size:10pt">16</font></p>

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  <p><font style="font-size:10pt"><b><u>Centralized Location of Manufacturing Operations</u></b></font></p><p><font style="font-size:10pt">The Company currently manufactures the vast majority of its products at its
manufacturing facilities in Southern California. Accordingly, any event resulting in the slowdown or stoppage of the Company&#146;s manufacturing operations or distribution facilities in Southern California could have a material adverse effect on
the Company. The Company maintains business interruption insurance. There can be no assurance, however, that such insurance will continue to be available at a reasonable cost or, if available, will be adequate to cover any losses that may be
incurred from an interruption in the Company&#146;s manufacturing and distribution operations.</font></p> <p><font style="font-size:10pt"><b><u>Concentration of Ownership; Certain Anti-Takeover Considerations</u></b></font></p><p><font
style="font-size:10pt">The Company&#146;s directors and executive officers beneficially own in excess of 24.5% of the outstanding common stock as of March 31, 2003. Accordingly, these shareholders will continue to have the ability to substantially
influence the management, policies and business operations of the Company. The Company&#146;s Board of Directors has the authority to approve the issuance of 500,000 shares of preferred stock and to fix the rights, preferences, privileges and
restrictions, including voting rights, of those shares without any further vote or action by the Company&#146;s shareholders. The rights of the holders of Common Stock will be subject to, and may be adversely affected by, the rights of holders of
any preferred stock that may be issued in the future. Certain provisions of Delaware law, as well as the issuance of preferred stock, and other &#147;anti-takeover&#148; provisions in the Company&#146;s Articles and Bylaws, could delay or inhibit
the removal of incumbent directors and could delay, defer, make more difficult or prevent a merger, tender offer or proxy contest, or any change in control involving the Company, as well as the removal of management, even if such events would be
beneficial to the interests of the Company&#146;s shareholders, and may limit the price certain investors may be willing to pay in the future for shares of common stock.</font></p>
<table border="0" cellspacing="0" width="100%">
<tr>
<td width="5%" valign="top"><font style="font-size:10pt"><b></b></font></td>
<td width="95%" valign="top"><font style="font-size:10pt"><b></b></font></td> </tr>
<tr>
<td valign="top" nowrap><font style="font-size:10pt"><b>Item 3.</b></font></td>
<td valign="top"><font style="font-size:10pt"><b> Quantitative and Qualitative Disclosures About Market Risk</b></font></td> </tr> </table><p><font style="font-size:10pt">The Company is exposed to market risks from adverse changes in interest rates,
and foreign exchange rates affecting the return on our investments and the cost of our debt. The Company does not use derivative financial instruments to reduce the impact of changes in interest or foreign exchange rates.</font></p> <p><font
style="font-size:10pt">At March 31, 2003 the Company&#146;s cash equivalents consisted of financial instruments with original maturities of three months or less. </font></p> <p><font style="font-size:10pt">The Company&#146;s debt as of March 31,
2003 totaled $3.1 million and was comprised of fixed rate loans of $765,000 and variable rate loans of $2.3 million. The average composite interest rates at March 31, 2003 for fixed rate and variable rate loans were 8.25% and 4.75%,
respectively.</font></p> <p><font style="font-size:10pt"><b>Item 4.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Controls and Procedures</b></font></p> <p><font style="font-size:10pt">The Company&#146;s Chief Executive Officer and Chief Financial Officer believe
the Company&#146;s disclosure controls and procedures, as defined in Securities Exchange Act Rules 13a-14 and 15d-14, are effective. This conclusion was reached after an evaluation of these controls and procedures as of March 31, 2003.</font></p>
<p><font style="font-size:10pt">We are not aware of any significant changes in the Company&#146;s internal controls, including any corrective actions with regard to significant deficiencies and material weaknesses, or in other factors that could
significantly affect these controls after March 31, 2003.</font></p> <p align="center"><font style="font-size:10pt">17</font></p>

<p Style='page-break-before:always'>
<HR  SIZE="3" COLOR="#999999" WIDTH="100%" ALIGN="CENTER">
  <p><font style="font-size:10pt"><b>Part II.&nbsp;&nbsp;Other Information</b></font></p> <p><font style="font-size:10pt"><b>ITEM 1. &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;LEGAL PROCEEDINGS</b></font></p> <p><font
style="font-size:10pt">The Company was a plaintiff in an antitrust lawsuit against several manufacturers of vitamins and other raw materials purchased by the Company. Other similarly situated companies filed a number of similar lawsuits against some
or all of the same manufacturers. The Company&#146;s lawsuit was consolidated with some of the others and captioned <i>In re: Vitamin Antitrust Litigation</i>, and was pending in U.S. District Court in Washington D.C. A final settlement payment of
$225,000 and a payment of $1,000,000 were received by the Company and are included in proceeds from vitamin antitrust litigation in the accompanying statement of operations for the nine months ended March 31, 2003 and 2002, respectively. All of its
claims under the <i>Vitamin Antitrust Litigation</i> were settled.</font></p> <p><font style="font-size:10pt">From time to time the Company may be subject to various claims and legal actions arising in the ordinary course of business. In the opinion
of management, after consultation with its legal counsel, there are no outstanding matters that are expected to have a material adverse effect on the Company&#146;s consolidated financial position, results of operations or liquidity.</font></p>
<p><font style="font-size:10pt"><b>ITEM 2. &nbsp;&nbsp;&nbsp;&nbsp;CHANGES IN SECURITIES</b></font></p> <p><font style="font-size:10pt">None.</font></p> <p><font style="font-size:10pt"><b>ITEM 3. &nbsp;&nbsp;&nbsp;&nbsp;DEFAULTS BY THE COMPANY ON
ITS SENIOR SECURITIES</b></font></p> <p><font style="font-size:10pt">None.</font></p> <p><font style="font-size:10pt"><b>ITEM 4. &nbsp;&nbsp;&nbsp;&nbsp;SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS</b></font></p> <p><font
style="font-size:10pt">None.</font></p> <p><font style="font-size:10pt"><b>ITEM 5. &nbsp;&nbsp;&nbsp;&nbsp;OTHER INFORMATION</b></font></p> <p><font style="font-size:10pt">None.</font></p> <p><font style="font-size:10pt"><b>ITEM 6.
&nbsp;&nbsp;&nbsp;&nbsp;EXHIBITS AND REPORTS ON FORM 8-K</b></font></p>
<table border="0" cellspacing="0" width="100%">
<tr>
<td width="5%" valign="top"><font style="font-size:10pt"></font></td>
<td width="95%" valign="top"><font style="font-size:10pt"></font></td> </tr>
<tr>
<td valign="top"><font style="font-size:10pt">(a)</font></td>
<td valign="top"><font style="font-size:10pt">Exhibits: None</font></td> </tr>
<tr>
<td valign="top"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="top"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr>
<td valign="top"><font style="font-size:10pt">(b)</font></td>
<td valign="top"><font style="font-size:10pt">No reports on Form 8-K were filed during the quarter for which this report is filed.</font></td> </tr> </table> <p><font style="font-size:10pt"><b>SIGNATURES</b></font></p> <p><font
style="font-size:10pt">Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.</font></p>
<table border="0" cellspacing="0" width="100%">
<tr>
<td width="30%" align="center" valign="top"><font style="font-size:10pt"><b></b></font></td>
<td width="50%" valign="top">&nbsp;</td>
<td width="20%" valign="top"><font style="font-size:10pt"></font></td> </tr>
<tr>
<td align="center" valign="top" colspan="3"> <div align="left"><font style="font-size:10pt"><b>N<small>ATURAL</small> A<small>LTERNATIVES</small> I<small>NTERNATIONAL,</small> I<small>NC.</small></b></font></div> </td> </tr>
<tr>
<td align="center" valign="top">&nbsp;</td>
<td valign="top">&nbsp;</td>
<td valign="top">&nbsp;</td> </tr>
<tr>
<td align="center" valign="top"><font style="font-size:10pt">/s/ J<small>OHN</small> R. R<small>EAVES</small></font></td>
<td valign="top">&nbsp;</td>
<td valign="top"><font style="font-size:10pt">Date:&nbsp;&nbsp;May 13, 2003</font></td> </tr>
<tr>
<td align="center" valign="top"> <hr size="1" width="100%" color="black" noshade> </td>
<td valign="top">&nbsp;</td>
<td valign="top"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr>
<td align="center" valign="top"><font style="font-size:8pt"><b>John R. Reaves</b></font></td>
<td align="center" valign="top">&nbsp;</td>
<td align="center" valign="top"><font style="font-size:8pt"><b>&nbsp;</b></font></td> </tr>
<tr>
<td align="center" valign="top"><font style="font-size:8pt"><b>Chief Financial Officer</b></font></td>
<td valign="top">&nbsp;</td>
<td valign="top"><font style="font-size:10pt">&nbsp;</font></td> </tr> </table> <p align="center"><font style="font-size:10pt">18</font></p>

<p Style='page-break-before:always'>
<HR  SIZE="3" COLOR="#999999" WIDTH="100%" ALIGN="CENTER">
  <p align="center"><font style="font-size:10pt"><b>Certifications</b></font></p> <p><font style="font-size:10pt">I, Mark A. LeDoux, Chief Executive Officer of Natural Alternatives International, Inc., certify
that:</font></p>
<table border="0" cellspacing="0" width="100%">
<tr>
<td width="2%" valign="top"><font style="font-size:10pt"></font></td>
<td width="2%" valign="top"><font style="font-size:10pt"></font></td>
<td width="1%" valign="top"><font style="font-size:10pt"></font></td>
<td width="95%" valign="top"><font style="font-size:10pt"></font></td> </tr>
<tr>
<td valign="top"><font style="font-size:10pt">1.</font></td>
<td valign="top" colspan="3"><font style="font-size:10pt">I have reviewed this quarterly report on Form 10-Q of Natural Alternatives International, Inc.;</font></td> </tr>
<tr>
<td valign="top"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="top"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="top" colspan="2"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr>
<td valign="top"><font style="font-size:10pt">2.</font></td>
<td valign="top" colspan="3"><font style="font-size:10pt">Based on my knowledge, this quarterly report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the
circumstances under which such statements were made, not misleading with respect to the period covered by this quarterly report;</font></td> </tr>
<tr>
<td valign="top"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="top"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="top" colspan="2"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr>
<td valign="top"><font style="font-size:10pt">3.</font></td>
<td valign="top" colspan="3"><font style="font-size:10pt">Based on my knowledge, the financial statements, and other financial information included in this quarterly report, fairly present in all material respects the financial condition, results of
operations and cash flows of the registrant as of, and for, the periods presented in this quarterly report;</font></td> </tr>
<tr>
<td valign="top"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="top"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="top" colspan="2"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr>
<td valign="top"><font style="font-size:10pt">4.</font></td>
<td valign="top" colspan="3"><font style="font-size:10pt">The registrant&#146;s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-14 and 15d-14)
for the registrant and have:</font></td> </tr>
<tr>
<td valign="top"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="top"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="top" colspan="2"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr>
<td valign="top"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="top"><font style="font-size:10pt">a.</font></td>
<td valign="top" colspan="2"><font style="font-size:10pt">Designed such disclosure controls and procedures to ensure that material information relating to the registrant, including its consolidated subsidiary, is made known to us by others within
that entity, particularly during the period in which this quarterly report is being prepared; </font></td> </tr>
<tr>
<td valign="top"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="top"><font style="font-size:10pt">b.</font></td>
<td valign="top" colspan="2"><font style="font-size:10pt">Evaluated the effectiveness of the registrant&#146;s disclosure controls and procedures as of a date within 90 days prior to the filing date of this quarterly report (the &#147;Evaluation
Date&#148;); and</font></td> </tr>
<tr>
<td valign="top"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="top"><font style="font-size:10pt">c.</font></td>
<td valign="top" colspan="2"><font style="font-size:10pt">Presented in this quarterly report our conclusions about the effectiveness of the disclosure controls and procedures based on our evaluation of the Evaluation Date;</font></td> </tr>
<tr>
<td valign="top"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="top"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="top" colspan="2"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr>
<td valign="top"><font style="font-size:10pt">5.</font></td>
<td valign="top" colspan="3"><font style="font-size:10pt">The registrant&#146;s other certifying officer and I have disclosed, based on our most recent evaluation, to the registrant&#146;s auditors and audit committee of registrant&#146;s board of
directors:</font></td> </tr>
<tr>
<td valign="top"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="top"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="top"colspan="2"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr>
<td valign="top"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="top"><font style="font-size:10pt">a.</font></td>
<td valign="top" colspan="2"><font style="font-size:10pt">All significant deficiencies in the design or operation of internal controls which could adversely affect the registrant&#146;s ability to record, process, summarize and report financial data
and have identified for the registrant&#146;s auditors any material weaknesses in internal controls; and</font></td> </tr>
<tr>
<td valign="top"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="top"><font style="font-size:10pt">b.</font></td>
<td valign="top" colspan="2"><font style="font-size:10pt">Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant&#146;s internal controls; and</font></td> </tr>
<tr>
<td valign="top"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="top"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="top" colspan="2"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr>
<td valign="top"><font style="font-size:10pt">6.</font></td>
<td valign="top" colspan="3"><font style="font-size:10pt">The registrant&#146;s other certifying officer and I have indicated in this quarterly report whether there were significant changes in internal controls or in other factors that could
significantly affect internal controls subsequent to the date of our most recent evaluation, including any corrective actions with regard to significant deficiencies and material weaknesses.</font></td> </tr> </table> <P></P>
<table border="0" cellspacing="0" width="100%">
<tr>
<td width="50%" valign="top"><font style="font-size:10pt"></font></td>
<td width="5%" valign="top"><font style="font-size:10pt"></font></td>
<td width="45%" align="center" valign="top"><font style="font-size:10pt"></font></td> </tr>
<tr>
<td valign="top"><font style="font-size:10pt">Date: May 13, 2003</font></td>
<td valign="top"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="top"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr>
<td valign="top"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="top"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="top"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr>
<td valign="top"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="top"><font style="font-size:10pt">&nbsp;</font></td>
<td align="center" valign="top"><font style="font-size:10pt">/s/ M<small>ARK</small> A. L<small>E</small>D<small>OUX</small></font></td> </tr>
<tr>
<td valign="top"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="top"><font style="font-size:10pt">&nbsp;</font></td>
<td align="center" valign="top"><hr size="1" width="100%" color="black" noshade></td> </tr>
<tr>
<td valign="top"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="top"><font style="font-size:10pt">&nbsp;</font></td>
<td align="center" valign="top"><font style="font-size:8pt"><b>Mark A. LeDoux</b></font></td> </tr>
<tr>
<td align="center" valign="top"><font style="font-size:8pt"><b>&nbsp;</b></font></td>
<td align="center" valign="top"><font style="font-size:8pt"><b>&nbsp;</b></font></td>
<td align="center" valign="top"><font style="font-size:8pt"><b>Chief Executive Officer</b></font></td> </tr> </table> <p align="center"><font style="font-size:10pt">19</font></p>

<p Style='page-break-before:always'>
<HR  SIZE="3" COLOR="#999999" WIDTH="100%" ALIGN="CENTER">
  <p align="center"><font style="font-size:10pt"><b> Certifications</b></font></p> <p><font style="font-size:10pt">I, John R. Reaves, Chief Financial Officer of Natural Alternatives International, Inc., certify
that:</font></p>
<table border="0" cellspacing="0" width="100%">
<tr>
<td width="2%" valign="top"><font style="font-size:10pt"></font></td>
<td width="2%" valign="top"><font style="font-size:10pt"></font></td>
<td width="96%" valign="top"><font style="font-size:10pt"></font></td> </tr>
<tr>
<td valign="top" ><font style="font-size:10pt">1.</font></td>
<td valign="top" colspan="2"><font style="font-size:10pt">I have reviewed this quarterly report on Form 10-Q of Natural Alternatives International, Inc.;</font></td> </tr>
<tr>
<td valign="top" ><font style="font-size:10pt">&nbsp;</font></td>
<td valign="top" ><font style="font-size:10pt">&nbsp;</font></td>
<td valign="top" ><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr>
<td valign="top" ><font style="font-size:10pt">2.</font></td>
<td valign="top" colspan="2"><font style="font-size:10pt">Based on my knowledge, this quarterly report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the
circumstances under which such statements were made, not misleading with respect to the period covered by this quarterly report;</font></td> </tr>
<tr>
<td valign="top" ><font style="font-size:10pt">&nbsp;</font></td>
<td valign="top" ><font style="font-size:10pt">&nbsp;</font></td>
<td valign="top" ><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr>
<td valign="top" ><font style="font-size:10pt">3.</font></td>
<td valign="top" colspan="2"><font style="font-size:10pt">Based on my knowledge, the financial statements, and other financial information included in this quarterly report, fairly present in all material respects the financial condition, results of
operations and cash flows of the registrant as of, and for, the periods presented in this quarterly report;</font></td> </tr>
<tr>
<td valign="top" ><font style="font-size:10pt">&nbsp;</font></td>
<td valign="top" ><font style="font-size:10pt">&nbsp;</font></td>
<td valign="top" ><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr>
<td valign="top" ><font style="font-size:10pt">4.</font></td>
<td valign="top" colspan="2"><font style="font-size:10pt">The registrant&#146;s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-14 and 15d-14)
for the registrant and have:</font></td> </tr>
<tr>
<td valign="top" ><font style="font-size:10pt">&nbsp;</font></td>
<td valign="top" ><font style="font-size:10pt">&nbsp;</font></td>
<td valign="top" ><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr>
<td valign="top" ><font style="font-size:10pt">&nbsp;</font></td>
<td valign="top" ><font style="font-size:10pt">a.</font></td>
<td valign="top" ><font style="font-size:10pt">Designed such disclosure controls and procedures to ensure that material information relating to the registrant, including its consolidated subsidiary, is made known to us by others within that entity,
particularly during the period in which this quarterly report is being prepared; </font></td> </tr>
<tr>
<td valign="top" ><font style="font-size:10pt">&nbsp;</font></td>
<td valign="top" ><font style="font-size:10pt">b.</font></td>
<td valign="top" ><font style="font-size:10pt">Evaluated the effectiveness of the registrant&#146;s disclosure controls and procedures as of a date within 90 days prior to the filing date of this quarterly report (the &#147;Evaluation Date&#148;);
and</font></td> </tr>
<tr>
<td valign="top" ><font style="font-size:10pt">&nbsp;</font></td>
<td valign="top" ><font style="font-size:10pt">c.</font></td>
<td valign="top" ><font style="font-size:10pt">Presented in this quarterly report our conclusions about the effectiveness of the disclosure controls and procedures based on our evaluation of the Evaluation Date;</font></td> </tr>
<tr>
<td valign="top" ><font style="font-size:10pt">&nbsp;</font></td>
<td valign="top" ><font style="font-size:10pt">&nbsp;</font></td>
<td valign="top" ><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr>
<td valign="top" ><font style="font-size:10pt">5.</font></td>
<td valign="top" colspan="2"><font style="font-size:10pt">The registrant&#146;s other certifying officer and I have disclosed, based on our most recent evaluation, to the registrant&#146;s auditors and audit committee of registrant&#146;s board of
directors:</font></td> </tr>
<tr>
<td valign="top" ><font style="font-size:10pt">&nbsp;</font></td>
<td valign="top" ><font style="font-size:10pt">&nbsp;</font></td>
<td valign="top" ><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr>
<td valign="top" ><font style="font-size:10pt">&nbsp;</font></td>
<td valign="top" ><font style="font-size:10pt">a.</font></td>
<td valign="top" ><font style="font-size:10pt">All significant deficiencies in the design or operation of internal controls which could adversely affect the registrant&#146;s ability to record, process, summarize and report financial data and have
identified for the registrant&#146;s auditors any material weaknesses in internal controls; and</font></td> </tr>
<tr>
<td valign="top" ><font style="font-size:10pt">&nbsp;</font></td>
<td valign="top" ><font style="font-size:10pt">b.</font></td>
<td valign="top" ><font style="font-size:10pt">Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant&#146;s internal controls; and</font></td> </tr>
<tr>
<td valign="top" ><font style="font-size:10pt">&nbsp;</font></td>
<td valign="top" ><font style="font-size:10pt">&nbsp;</font></td>
<td valign="top" ><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr>
<td valign="top" ><font style="font-size:10pt">6.</font></td>
<td valign="top" colspan="2"><font style="font-size:10pt">The registrant&#146;s other certifying officer and I have indicated in this quarterly report whether there were significant changes in internal controls or in other factors that could
significantly affect internal controls subsequent to the date of our most recent evaluation, including any corrective actions with regard to significant deficiencies and material weaknesses.</font></td> </tr> </table> <p></p>
<table border="0" cellspacing="0" width="100%">
<tr>
<td width="50%" valign="top"><font style="font-size:10pt"></font></td>
<td width="5%" valign="top"><font style="font-size:10pt"></font></td>
<td width="45%" align="center" valign="top"><font style="font-size:10pt"></font></td> </tr>
<tr>
<td valign="top"><font style="font-size:10pt">Date: May 13, 2003</font></td>
<td valign="top"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="top"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr>
<td valign="top"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="top"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="top"><font style="font-size:10pt">&nbsp;</font></td> </tr>
<tr>
<td valign="top"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="top"><font style="font-size:10pt">&nbsp;</font></td>
<td align="center" valign="top"><font style="font-size:10pt">/s/ J<small>OHN</small> R. R<small>EAVES</small></font></td> </tr>
<tr>
<td valign="top"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="top"><font style="font-size:10pt">&nbsp;</font></td>
<td align="center" valign="top"><hr size="1" width="100%" color="black" noshade></td> </tr>
<tr>
<td valign="top"><font style="font-size:10pt">&nbsp;</font></td>
<td valign="top"><font style="font-size:10pt">&nbsp;</font></td>
<td align="center" valign="top"><font style="font-size:8pt"><b>John R. Reaves</b></font></td> </tr>
<tr>
<td align="center" valign="top"><font style="font-size:8pt"><b>&nbsp;</b></font></td>
<td align="center" valign="top"><font style="font-size:8pt"><b>&nbsp;</b></font></td>
<td align="center" valign="top"><font style="font-size:8pt"><b>Chief Financial Officer</b></font></td> </tr> </table> <p align="center"><font style="font-size:10pt">20</font></p>
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