Nationshealth Inc fka NHRX

[Tina]

Investor Contact At NationsHealth:
Bryan Happ, CFO 954-903-5288

NATIONSHEALTH ANNOUNCES 2008 SECOND QUARTER FINANCIAL RESULTS

SUNRISE, Fla. – August 12, 2008 - NationsHealth, Inc. (OTCBB: NHRX) (“NationsHealth” or the “Company”) today announced its financial results for the quarter and six months ended June
30, 2008.

Revenue for the quarter ended June 30, 2008 increased 45% to $24.7 million, compared to $17.0 million for the corresponding period in 2007. Net loss for the quarter ended June 30, 2008 was $1.9 million, or $0.07 per share, compared to a net loss of $0.5 million, or $0.02 per share, for the corresponding period in 2007. Results for the second quarter of 2008 reflect $1.5 million of restructuring costs related to the previously-announced May 2008 corporate restructuring.

Revenue for the six months ended June 30, 2008 increased 35% to $48.1 million, compared to $35.8 million for the corresponding period in 2007. Net loss for the six months ended June 30, 2008 was $3.8 million, or $0.13 per share, compared to a net loss of $1.7 million, or $0.06 per share, for the corresponding period in 2007. In addition to the $1.5 million of restructuring costs incurred during the second quarter of 2008, results for the first six months of 2008 were also impacted by $0.8 million of certain non-recurring costs as well as continued investment in growth initiatives within the Company’s Medical Products segment.

Adjusted EBITDA*, defined as earnings before interest, taxes, depreciation and amortization, stock based compensation and restructuring costs, was $2.7 million for the quarter ended June 30, 2008, compared to adjusted EBITDA of $2.5 million for the quarter ended June 30, 2007.

For the first six months of 2008, adjusted EBITDA was $4.3 million, compared to adjusted EBITDA of $4.0 million for the first six months of 2007.

The Company’s Insurance Services segment contributed profit of $4.6 million for the quarter ended June 30, 2008, compared to profit of $2.7 million for the quarter ended June 30, 2007. For the first six months of 2008, the Insurance Services segment contributed profit of $8.2 million, compared to profit of $4.8 million for the first six months of 2007. The Medical Products segment had a loss of $0.1 million for the quarter ended June 30, 2008, compared to a $1.5 million profit for the quarter ended June 30, 2007. For the six months ended June 30, 2008, the Medical Products segment was breakeven, compared to a $3.1 million profit for the first six months of 2007. As anticipated, results for the Medical Products segment for the 2008 periods were adversely impacted by investments in certain growth initiatives, which have significantly
enhanced this segment's revenue and future profitability prospects. In addition, results were impacted by higher amortization of acquired intangible assets, including those recorded in the Company's acquisition of Diabetes Care & Education, Inc. in the third quarter of 2007. Segment profit and loss, as discussed above, is before allocation of corporate
overhead and other unallocated amounts.

“We are pleased with the results of our growth and patient acquisition strategies, which have enabled us to increase our second quarter revenue from our Medical Products segment by 9%
from the preceding quarter and over 60% from the 2007 second quarter” said Glenn Parker, Chief Executive Officer of NationsHealth. “We look forward to continuing this revenue growth during the second half of 2008, as well as improving our bottom line as we realize the financial impact of our recent corporate restructuring and other cost reductions, with a view towards net income profitability.”

About NationsHealth, Inc.
NationsHealth seeks to improve the delivery of healthcare to Medicare and managed care beneficiaries by providing medical products and prescription related services. NationsHealth
provides home delivery of diabetes supplies and insulin pumps, medications and other medical products to patients across the nation. In addition to its medical products business, NationsHealth also provides education, marketing, enrollment and member service to insurers offering Medicare Part D prescription drug plans and other Medicare insurance coverage. NationsHealth has an agreement with CIGNA to service its Medicare Part D prescription drug plans nationally. For
more information, please visit http://www.nationshealth.com.

https://www.nationshealth.com/pdf/Q2%202008%20Earnings%20FINAL.pdf