##### Table of Contents



UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
 Washington, D.C. 20549
 FORM 10-Q
  þ
    
    QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
 For the quarterly period ended June 30, 2008
 OR
 o
    
    TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
 For the transition period from  to
 Commission file number: 000-50417
 RBC Life Sciences, Inc.
  Nevada
    
    91-2015186(State or other jurisdiction of incorporation or organization)
    
    (IRS Employer Identification No.)2301 Crown Court, Irving, Texas
    
    75038(Address of principal executive offices)
    
    (Zip code)
 (Registrants telephone number, including area code)
 þ o
  Large accelerated filer o
    
    Accelerated filer o
    
    Non-accelerated filer o
    
    Smaller reporting company þ(Do not check if smaller reporting company)
 o
YES þ NO




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##### 



Page NumberPART I  FINANCIAL INFORMATIONItem 1. Condensed Consolidated Financial Statements (unaudited)
    
    
    3Notes to Condensed Consolidated Financial Statements
    
    
    7Item 2. Managements Discussion and Analysis of Financial Condition
and Results of Operations
    
    
    15Item 3. Quantitative and Qualitative Disclosures about Market Risk
    
    
    20Item 4. Controls and Procedures
    
    
    21PART II  OTHER INFORMATIONItem 1. Legal Proceedings
    
    
    22Item 1A. Risk Factors
    
    
    22Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
    
    
    22Item 3. Defaults Upon Senior Securities
    
    
    22Item 4. Submission of Matters to a Vote of Security Holders
    
    
    22Item 5. Other Information
    
    
    22Item 6. Exhibits
    
    
    22Signatures
    
    
    23Exhibit Index
    
    
    24Exhibit 31.1Exhibit 31.2Exhibit 32.1Exhibit 32.2




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##### Table of Contents



PART 1  FINANCIAL INFORMATION
 
 ITEM 1. FINANCIAL STATEMENTS
 RBC LIFE SCIENCES, INC. and SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
 June 30,
    
    
    December 31,2008
    
    
    2007(Unaudited)ASSETSCurrent assets:Cash and cash equivalents
    
    $
    5,372,951
    
    
    $
    6,368,885Accounts receivable, net
    
    
    645,754
    
    
    
    687,505Inventories
    
    
    5,701,702
    
    
    
    4,725,372Deferred income taxes
    
    
    400,395
    
    
    
    340,395Prepaid expenses
    
    
    811,225
    
    
    
    305,960Total current assets
    
    
    12,932,027
    
    
    
    12,428,117Property and equipment, net
    
    
    4,187,882
    
    
    
    4,078,035Goodwill, net
    
    
    2,285,942
    
    
    
    2,302,226Intangible assets, net
    
    
    130,552
    
    
    
    151,758Other assets
    
    
    198,934
    
    
    
    198,306$
    19,735,337
    
    
    $
    19,158,442LIABILITIES AND SHAREHOLDERS EQUITYCurrent liabilities:Accounts payable, trade
    
    $
    1,894,846
    
    
    $
    1,932,158Accrued liabilities
    
    
    1,086,825
    
    
    
    2,498,682Current maturities of long-term obligations
    
    
    138,926
    
    
    
    135,428Deferred revenue
    
    
    5,736,004
    
    
    
    4,323,316Total current liabilities
    
    
    8,856,601
    
    
    
    8,889,584Long-term obligations, less current maturities
    
    
    2,125,664
    
    
    
    2,196,468Deferred income taxes
    
    
    442,984
    
    
    
    494,265Shareholders equity:Common stock, $0.001 par value; 50,000,000
shares authorized; 21,242,664 and 20,863,724 shares
issued and outstanding at June 30, 2008 and
December 31, 2007, respectively
    
    
    21,243
    
    
    
    20,864Additional paid-in capital
    
    
    13,203,871
    
    
    
    13,086,182Accumulated deficit
    
    
    (5,088,670
    )
    
    
    (5,720,001
    )Accumulated other comprehensive income
    
    
    173,644
    
    
    
    191,0808,310,088
    
    
    
    7,578,125$
    19,735,337
    
    
    $
    19,158,442
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RBC LIFE SCIENCES, INC. and SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
 For the Quarters Ended June 30,2008
    
    
    2007Net sales
    
    $
    6,886,775
    
    
    $
    7,147,513Cost of sales
    
    
    3,190,209
    
    
    
    3,354,181Gross profit
    
    
    3,696,566
    
    
    
    3,793,332Operating expenses:General and administrative
    
    
    2,551,430
    
    
    
    2,200,004Distributor commissions
    
    
    560,100
    
    
    
    643,263Depreciation and amortization
    
    
    84,473
    
    
    
    83,955Total operating expenses
    
    
    3,196,003
    
    
    
    2,927,222Operating profit
    
    
    500,563
    
    
    
    866,110Interest expense
    
    
    44,091
    
    
    
    53,951Earnings before income taxes
    
    
    456,472
    
    
    
    812,159Provision for income taxes
    
    
    180,000
    
    
    
    302,000Net earnings
    
    $
    276,472
    
    
    $
    510,159Earnings per share:Basic
    
    $
    0.01
    
    
    $
    0.03Diluted
    
    
    0.01
    
    
    
    0.02Weighted average common shares outstanding:Basic
    
    
    21,242,664
    
    
    
    20,265,961Diluted
    
    
    22,943,569
    
    
    
    22,498,525
   - 4 -




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RBC LIFE SCIENCES, INC. and SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
 For the Six Months Ended June 30,2008
    
    
    2007Net sales
    
    $
    13,234,466
    
    
    $
    12,539,565Cost of sales
    
    
    6,035,111
    
    
    
    5,441,918Gross profit
    
    
    7,199,355
    
    
    
    7,097,647Operating expenses:General and administrative
    
    
    4,804,182
    
    
    
    4,166,860Distributor commissions
    
    
    1,117,748
    
    
    
    1,298,153Depreciation and amortization
    
    
    165,260
    
    
    
    174,173Total operating expenses
    
    
    6,087,190
    
    
    
    5,639,186Operating profit
    
    
    1,112,165
    
    
    
    1,458,461Interest expense
    
    
    88,834
    
    
    
    113,161Earnings before income taxes
    
    
    1,023,331
    
    
    
    1,345,300Provision for income taxes
    
    
    392,000
    
    
    
    510,000Net earnings
    
    $
    631,331
    
    
    $
    835,300Earnings per share:Basic
    
    $
    0.03
    
    
    $
    0.04Diluted
    
    
    0.03
    
    
    
    0.04Weighted average common shares outstanding:Basic
    
    
    21,178,551
    
    
    
    20,227,127Diluted
    
    
    22,920,405
    
    
    
    22,109,002
   - 5 -




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##### Table of Contents



RBC LIFE SCIENCES, INC. and SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
 For the Six Months Ended June 30,2008
    
    
    2007Cash flows from operating activities:Net earnings
    
    $
    631,331
    
    
    $
    835,300Adjustment for non-cash items:Depreciation and amortization
    
    
    181,723
    
    
    
    187,771Stock-based compensation
    
    
    61,945
    
    
    
    38,055Deferred income taxes
    
    
    (113,000
    )
    
    
    (140,000
    )Change in operating assets and liabilities:Accounts receivable
    
    
    41,773
    
    
    
    (406,491
    )Inventories
    
    
    (980,283
    )
    
    
    (1,081,380
    )Prepaid expenses
    
    
    (505,491
    )
    
    
    (85,956
    )Other assets
    
    
    (924
    )
    
    
    (6,005
    )Accounts payable and accrued liabilities
    
    
    (1,445,407
    )
    
    
    1,815,285Deferred revenue
    
    
    1,412,688
    
    
    
    (119,016
    )Net cash provided (used) by operating activities
    
    
    (715,645
    )
    
    
    1,037,563Cash flows from investing activities:Purchase of property and equipment
    
    
    (271,554
    )
    
    
    (92,673
    )Net cash used by investing activities
    
    
    (271,554
    )
    
    
    (92,673
    )Cash flows from financing activities:Net payments of lines of credit
    
    
    
    
    
    
    (100,000
    )Payments of long-term obligations
    
    
    (67,306
    )
    
    
    (223,096
    )Proceeds from the exercise of stock options
    
    
    56,123
    
    
    
    33,785Net cash used by financing activities
    
    
    (11,183
    )
    
    
    (289,311
    )Effect of exchange rate changes on cash flows
    
    
    2,448
    
    
    
    8,410Net increase (decrease) in cash and cash equivalents
    
    
    (995,934
    )
    
    
    663,989Cash and cash equivalents, beginning of period
    
    
    6,368,885
    
    
    
    3,219,503Cash and cash equivalents, end of period
    
    $
    5,372,951
    
    
    $
    3,883,492
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##### Table of Contents



RBC LIFE SCIENCES, INC. AND SUBSIDIARIES
 
 NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
 Note A  Unaudited Condensed Consolidated Financial Statements:
   Note B  Nature of Operations and Organization:
     - 7 -




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Note C  Inventories:
  June 30, 2008
    
    
    December 31, 2007Raw materials and bulk products
    
    $
    520,185
    
    
    $
    573,625Packaging materials
    
    
    527,172
    
    
    
    509,541Finished goods
    
    
    4,654,345
    
    
    
    3,642,206$
    5,701,702
    
    
    $
    4,725,372
 Note D  Prepaid Expenses:
  June 30, 2008
    
    
    December 31, 2007Advance payment to suppliers
    
    $
    484,100
    
    
    $
    179,844Prepaid insurance and other
    
    
    327,125
    
    
    
    126,116$
    811,225
    
    
    $
    305,960
 Note E  Property and Equipment:
  June 30, 2008
    
    
    December 31, 2007Building and improvements
    
    $
    3,496,656
    
    
    $
    3,314,482Computer software and office equipment
    
    
    1,528,614
    
    
    
    1,567,381Warehouse equipment
    
    
    349,372
    
    
    
    345,030Automotive equipment
    
    
    55,392
    
    
    
    55,392Leasehold improvements
    
    
    21,460
    
    
    
    22,1205,451,494
    
    
    
    5,304,405Less  accumulated depreciation
    
    
    (2,404,785
    )
    
    
    (2,367,543
    )3,046,709
    
    
    
    2,936,862Land
    
    
    1,141,173
    
    
    
    1,141,173$
    4,187,882
    
    
    $
    4,078,035
 Note F  Goodwill and Other Intangible Assets:
  June 30, 2008
    
    
    December 31, 2007Gross
    
    
    
    
    
    
    Grosscarrying
    
    
    Accumulated
    
    
    carrying
    
    
    Accumulatedvalue
    
    
    amortization
    
    
    value
    
    
    amortizationGoodwill
    
    $
    3,411,738
    
    
    $
    (1,125,796
    )
    
    $
    3,443,512
    
    
    $
    (1,141,286
    )
  - 8 -




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June 30, 2008
    
    
    December 31, 2007Average
    
    
    Gross
    
    
    
    
    
    
    GrossLife
    
    
    Carrying
    
    
    Accumulated
    
    
    Carrying
    
    
    Accumulated(years)
    
    
    Value
    
    
    Amortization
    
    
    Value
    
    
    AmortizationDistribution contracts
    
    
    8
    
    
    $
    277,369
    
    
    $
    (228,061
    )
    
    $
    277,369
    
    
    $
    (211,583
    )Copyrights,
trademarks and other
registrations
    
    
    19
    
    
    
    99,100
    
    
    
    (36,336
    )
    
    
    99,100
    
    
    
    (33,694
    )Other
    
    
    11
    
    
    
    47,600
    
    
    
    (29,120
    )
    
    
    47,600
    
    
    
    (27,034
    )$
    424,069
    
    
    $
    (293,517
    )
    
    $
    424,069
    
    
    $
    (272,311
    )
  Remainder of 2008
    
    $
    21,2032009
    
    
    24,0492010
    
    
    21,6262011
    
    
    13,7922012
    
    
    5,957Thereafter
    
    
    43,925Total
    
    $
    130,552
 Note G  Accrued Liabilities:
  June 30, 2008
    
    
    December 31, 2007Salaries and wages
    
    $
    596,412
    
    
    $
    850,855Income taxes
    
    
    
    
    
    
    1,052,813Distributor commissions
    
    
    321,259
    
    
    
    362,900Sales and property taxes
    
    
    61,808
    
    
    
    57,908Interest
    
    
    14,625
    
    
    
    15,064Other
    
    
    92,721
    
    
    
    159,142$
    1,086,825
    
    
    $
    2,498,682
 Note H  Share-Based Compensation:
 Share-Based Payment
  - 9 -




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Quarters Ended June 30,
    
    
    Six Months Ended June 30,2008 (1)
    
    
    2007 (1)
    
    
    2008
    
    
    2007 (1)Weighted average expected life (years)
    
    
    
    
    
    
    
    
    
    
    9.0
    
    
    
    Risk-free interest rate
    
    
    
    
    
    
    
    
    
    
    3.77
    %
    
    
    Expected volatility
    
    
    
    
    
    
    
    
    
    
    138.57
    %
    
    
    Expected dividend yield
    
    
    
    
    
    
    
    
    
    
    0.0
    %
    
    
    
 
 (1)
    
    There were no option grants during this period.  Weighted-AverageWeighted-
    
    
    Remaining
    
    
    AggregateAverage Exercise
    
    
    Contractual Term
    
    
    IntrinsicOptions
    
    
    Price per Share
    
    
    (in years)
    
    
    ValueOutstanding on January 1, 2008
    
    
    3,494,950
    
    
    $
    0.32Granted
    
    
    100,000
    
    
    
    0.71Exercised
    
    
    (378,940
    )
    
    
    0.15Forfeited/canceled
    
    
    (40,297
    )
    
    
    0.22Outstanding on June 30, 2008
    
    
    3,175,713
    
    
    $
    0.35
    
    
    
    4.4
    
    
    $
    1,150,686Exercisable on June 30, 2008
    
    
    2,240,577
    
    
    $
    0.27
    
    
    
    3.2
    
    
    $
    967,444
 
 Weighted-AverageGrant Date FairShares
    
    
    Value per ShareNon-vested stock options at January 1, 2008
    
    
    866,540
    
    
    $
    0.50Non-vested stock options granted
    
    
    100,000
    
    
    
    0.69Vested stock options
    
    
    (20,000
    )
    
    
    0.15Forfeited stock options
    
    
    (11,404
    )
    
    
    0.48Non-vested stock options at June 30, 2008
    
    
    935,136
    
    
    
    0.53
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Note I  Long-Term Obligations and Credit Lines:
  June 30, 2008
    
    
    December 31, 2007Mortgage note payable bearing interest at
7.75%, payable in monthly installments of
$25,797 through April 2019, collateralized
by land and building, and personally guaranteed
by the Companys Chief Executive Officer
    
    $
    2,264,590
    
    
    $
    2,330,130Capital lease obligation
    
    
    
    
    
    
    1,7662,264,590
    
    
    
    2,331,896Less  current maturities
    
    
    (138,926
    )
    
    
    (135,428
    )$
    2,125,664
    
    
    $
    2,196,468
   Note J  Segments and Geographic Area:
    - 11 -




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##### Table of Contents



Nutritional Products
    
    
    Medical Products
    
    
    ConsolidatedQuarter ended June 30, 2008Net sales
    
    $
    5,361
    
    
    $
    1,526
    
    
    $
    6,887Depreciation and amortization
    
    
    69
    
    
    
    24
    
    
    
    93Operating profit
    
    
    384
    
    
    
    117
    
    
    
    501Capital expenditures
    
    
    184
    
    
    
    8
    
    
    
    192Total assets
    
    
    18,054
    
    
    
    1,681
    
    
    
    19,735Quarter ended June 30, 2007Net sales
    
    $
    6,059
    
    
    $
    1,089
    
    
    $
    7,148Depreciation and amortization
    
    
    69
    
    
    
    23
    
    
    
    92Operating profit
    
    
    815
    
    
    
    51
    
    
    
    866Capital expenditures
    
    
    67
    
    
    
    
    
    
    
    67Total assets
    
    
    13,983
    
    
    
    1,843
    
    
    
    15,826Six Months ended June 30, 2008Net sales
    
    $
    10,346
    
    
    $
    2,888
    
    
    $
    13,234Depreciation and amortization
    
    
    134
    
    
    
    48
    
    
    
    182Operating profit
    
    
    952
    
    
    
    160
    
    
    
    1,112Capital expenditures
    
    
    249
    
    
    
    23
    
    
    
    272Total assets
    
    
    18,054
    
    
    
    1,681
    
    
    
    19,735Six Months ended June 30, 2007Net sales
    
    $
    10,419
    
    
    $
    2,121
    
    
    $
    12,540Depreciation and amortization
    
    
    141
    
    
    
    47
    
    
    
    188Operating profit
    
    
    1,281
    
    
    
    177
    
    
    
    1,458Capital expenditures
    
    
    93
    
    
    
    
    
    
    
    93Total assets
    
    
    13,983
    
    
    
    1,843
    
    
    
    15,826
  Quarter Ended June 30, 2008
    
    
    Quarter Ended June 30, 2007Net sales
    
    
    Long-Lived assets
    
    
    Net sales
    
    
    Long-Lived assetsDomestic
    
    $
    2,600
    
    
    $
    6,228
    
    
    $
    2,531
    
    
    $
    6,116Former Soviet Union
    
    
    3,672
    
    
    
    
    
    
    
    4,081
    
    
    
    Canada
    
    
    306
    
    
    
    575
    
    
    
    358
    
    
    
    381All others
    
    
    309
    
    
    
    
    
    
    
    178
    
    
    
    Totals
    
    $
    6,887
    
    
    $
    6,803
    
    
    $
    7,148
    
    
    $
    6,497
 Six Months Ended June 30, 2008
    
    
    Six Months Ended June 30, 2007Net sales
    
    
    Long-Lived assets
    
    
    Net sales
    
    
    Long-Lived assetsDomestic
    
    $
    5,138
    
    
    $
    6,228
    
    
    $
    5,081
    
    
    $
    6,116Former Soviet Union
    
    
    7,047
    
    
    
    
    
    
    
    6,415
    
    
    
    Canada
    
    
    595
    
    
    
    575
    
    
    
    711
    
    
    
    381All others
    
    
    454
    
    
    
    
    
    
    
    333
    
    
    
    Totals
    
    $
    13,234
    
    
    $
    6,803
    
    
    $
    12,540
    
    
    $
    6,497
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Significant Customers
  Note K  Earnings Per Share:
  WeightedAverageNet Earnings
    
    
    Shares
    
    
    Per ShareQuarter ended June 30, 2008Basic earnings per common share
    
    $
    276,472
    
    
    
    21,242,664
    
    
    $
    0.01Effect of dilutive stock options
    
    
    
    
    
    
    1,700,905Diluted earnings per common share
    
    $
    276,472
    
    
    
    22,943,569
    
    
    $
    0.01Quarter ended June 30, 2007Basic earnings per common share
    
    $
    510,159
    
    
    
    20,265,961
    
    
    $
    0.03Effect of dilutive stock options
    
    
    
    
    
    
    2,232,564Diluted earnings per common share
    
    $
    510,159
    
    
    
    22,498,525
    
    
    $
    0.02Six Months ended June 30, 2008Basic earnings per common share
    
    $
    631,331
    
    
    
    21,178,551
    
    
    $
    0.03Effect of dilutive stock options
    
    
    
    
    
    
    1,741,854Diluted earnings per common share
    
    $
    631,331
    
    
    
    22,920,405
    
    
    $
    0.03Six Months ended June 30, 2007Basic earnings per common share
    
    $
    835,300
    
    
    
    20,227,127
    
    
    $
    0.04Effect of dilutive stock options
    
    
    
    
    
    
    1,881,875Diluted earnings per common share
    
    $
    835,300
    
    
    
    22,109,002
    
    
    $
    0.04
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##### Table of Contents



Note L  Comprehensive Income:
  Quarters Ended June 30,
    
    
    Six Months Ended June 30,2008
    
    
    2007
    
    
    2008
    
    
    2007Net earnings
    
    $
    276,472
    
    
    $
    510,159
    
    
    $
    631,331
    
    
    $
    835,300Other comprehensive income (loss):Foreign currency translation adjustment
    
    
    5,875
    
    
    
    13,591
    
    
    
    (17,436
    )
    
    
    15,818Comprehensive income
    
    $
    282,347
    
    
    $
    523,750
    
    
    $
    613,895
    
    
    $
    851,118
 Note M  Legal Proceedings:
   - 14 -




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ITEM 2. Managements Discussion and Analysis of Financial Condition and Results of
Operations.
  FORWARD-LOOKING STATEMENTS
  OVERVIEW
  
    
    Through the Nutritional Products segment, we distribute products in three broad categories:
(i) wellness products, (ii) fitness products and (iii) skin care products. Products include
herbal formulas, vitamins, minerals, antioxidants and personal care products. In certain
markets, principally in the U.S. and Canada, we distribute Nutritional Products directly
through a network of independent Associates. In certain other markets, we distribute
Nutritional Products through exclusive license arrangements with third parties who, for the
most part, distribute our products through an independent Associate network in the licensed
territory.
 
    
    Through the Medical Products segment, we distribute wound care products. These products
are distributed mainly in the U.S. to hospitals, nursing homes, clinics and pharmacies through
traditional medical/surgical supply dealers and pharmaceutical distributors. MPMs Medical
Products are used to prevent and treat wounds, and manage pain associated with wounds, in the
acute care, long-term care, oncology and podiatry markets.
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Quarters Ended June 30,2008
    
    
    2007(U.S. dollars in 000s)Nutritional Products:Associate network
    
    $
    1,481
    
    
    
    22
    %
    
    $
    1,801
    
    
    
    25
    %Licensees
    
    
    3,880
    
    
    
    56
    %
    
    
    4,258
    
    
    
    60
    %5,361
    
    
    
    78
    %
    
    
    6,059
    
    
    
    85
    %Medical Products
    
    
    1,526
    
    
    
    22
    %
    
    
    1,089
    
    
    
    15
    %$
    6,887
    
    
    
    100
    %
    
    $
    7,148
    
    
    
    100
    %
 Six Months Ended June 30,2008
    
    
    2007(U.S. dollars in 000s)Nutritional Products:Associate network
    
    $
    2,946
    
    
    
    22
    %
    
    $
    3,674
    
    
    
    29
    %Licensees
    
    
    7,400
    
    
    
    56
    %
    
    
    6,745
    
    
    
    54
    %10,346
    
    
    
    78
    %
    
    
    10,419
    
    
    
    83
    %Medical Products
    
    
    2,888
    
    
    
    22
    %
    
    
    2,121
    
    
    
    17
    %$
    13,234
    
    
    
    100
    %
    
    $
    12,540
    
    
    
    100
    %
 Associate Network
 Quarters Ended June 30,
    
    
    Six Months Ended June 30,2008
    
    
    2007
    
    
    2008
    
    
    2007United States
    
    
    79
    %
    
    
    81
    %
    
    
    80
    %
    
    
    81
    %Canada
    
    
    21
    
    
    
    19
    
    
    
    20
    
    
    
    19100
    %
    
    
    100
    %
    
    
    100
    %
    
    
    100
    %
  Licensees.
  Medical Products.
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CRITICAL ACCOUNTING POLICIES AND ESTIMATES
   RESULTS OF OPERATIONS
  Quarters Ended June 30,
    
    
    Six Months Ended June 30,2008
    
    
    2007
    
    
    2008
    
    
    2007Net sales
    
    
    100.0
    %
    
    
    100.0
    %
    
    
    100.0
    %
    
    
    100.0
    %Cost of sales
    
    
    46.3
    
    
    
    46.9
    
    
    
    45.6
    
    
    
    43.4Gross profit
    
    
    53.7
    
    
    
    53.1
    
    
    
    54.4
    
    
    
    56.6Operating expenses:General and administrative
    
    
    37.1
    
    
    
    30.8
    
    
    
    36.3
    
    
    
    33.2Distributor commissions
    
    
    8.1
    
    
    
    9.0
    
    
    
    8.4
    
    
    
    10.4Depreciation and amortization
    
    
    1.2
    
    
    
    1.2
    
    
    
    1.3
    
    
    
    1.4Total operating expenses
    
    
    46.4
    
    
    
    41.0
    
    
    
    46.0
    
    
    
    45.0Operating profit
    
    
    7.3
    
    
    
    12.1
    
    
    
    8.4
    
    
    
    11.6Interest expense
    
    
    0.7
    
    
    
    0.8
    
    
    
    0.7
    
    
    
    0.9Earnings before income taxes
    
    
    6.6
    
    
    
    11.3
    
    
    
    7.7
    
    
    
    10.7Provision for income taxes
    
    
    2.6
    
    
    
    4.2
    
    
    
    2.9
    
    
    
    4.0Net earnings
    
    
    4.0
    %
    
    
    7.1
    %
    
    
    4.8
    %
    
    
    6.7
    %
 Quarter ended June 30, 2008 compared with quarter ended June 30, 2007
 Net sales.
 Associate Network
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Licensees
 Medical products.
 Cost of sales.
 General and administrative.
 Distributor commissions.
 Income taxes.
 Net earnings.
 Six months ended June 30, 2008 compared with six months June 30, 2007
 Net sales.
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Associate Network
 Licensees
 Medical products.
 Cost of sales.
 General and administrative.
 Distributor commissions.
 Income taxes.
 Net earnings.
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LIQUIDITY AND CAPITAL RESOURCES
 Cash and working capital.
 Operating activities
 Investing activities.
 Financing activities
 General liquidity and cash flows .
  
 ITEM 3. Quantitative and Qualitative Disclosures About Market Risk.
  Foreign exchange
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Interest rates
  
 ITEM 4. Controls and Procedures.
    - 21 -




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PART II  OTHER INFORMATION
 
 ITEM 1. Legal Proceedings.
  
 ITEM 1A. Risk Factors.
  
 ITEM 2. Unregistered Sales of Equity Securities and Use of Proceeds.
  
 ITEM 3. Defaults Upon Senior Securities.
  
 ITEM 4. Submission of Matters to a Vote of Security Holders.
  For
    
    
    WithheldSteven E. Brown
    
    
    19,456,672
    
    
    
    70,800Clinton H. Howard
    
    
    19,463,172
    
    
    
    64,300Paul R. Miller
    
    
    19,458,172
    
    
    
    69,300Joseph P. Philipp
    
    
    19,482,672
    
    
    
    44,800John W. Price
    
    
    19,458,172
    
    
    
    69,300Kenneth L. Sabot
    
    
    19,457,172
    
    
    
    70,300
 
 ITEM 5. Other Information.
  
 ITEM 6. Exhibits.
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SIGNATURES
  RBC Life Sciences, Inc.
RegistrantDate: August 13, 2008
    By:
    /s/ Clinton H. HowardIts: Chief Executive OfficerDate: August 13, 2008
    By:
    /s/ Steven E. BrownIts:
    Vice President-Finance andChief Financial Officer
(Principal Financial and Accounting Officer)  - 23 -




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RBC LIFE SCIENCES, INC.
 
 Exhibit Index
 Exhibit Number
    
    Description31.1
    
    
    Certification of Principal Executive Officer Pursuant to
Section 302 of the Sarbanes-Oxley Act of 200231.2
    
    
    Certification of Principal Financial Officer Pursuant to
Section 302 of the Sarbanes-Oxley Act of 200232.1
    
    
    Certification of Principal Executive Officer Pursuant to 18
U.S.C. Section 1350, As Adopted Pursuant to Section 906 of the Sarbanes-Oxley
Act of 200232.2
    
    
    Certification of Principal Financial Officer Pursuant to 18
U.S.C. Section 1350, As Adopted Pursuant to Section 906 of the Sarbanes-Oxley
Act of 2002
  - 24 -