Smart Balance Inc. Issues Additional Historical Financial Information for Investors

PARAMUS, N.J., Dec. 4 /PRNewswire-FirstCall/ -- Smart Balance Inc. today issued additional historical financial information to support investors' review of the Company's performance. The Company had indicated in its quarterly earnings releases for the Second and Third Quarters of 2007 that its GAAP financial information includes the results of its recent acquisition of GFA Brands, Inc. (GFA) (the operating company acquired by Smart Balance Inc. on May 21, 2007) from May 21, 2007 and therefore were not necessarily comparable for the prior periods presented in those releases. Accordingly, the Company decided to present historical periods on an "operating basis" which excluded the operating expenses of the parent company prior to the acquisition of GFA and included only the operating results of GFA in periods prior to the date of acquisition.

Because of investor requests, the Company has decided to provide additional historical financial information on an operating basis reconciling those results to GAAP results. That information is provided in the accompanying tables. The Company believes that this presentation allows investors more useful information because it reflects the actual performance and expenses of the operating entity in both the current and prior periods presented.

The operating basis results should not be viewed in isolation or as a substitution for GAAP results.

About Smart Balance Inc.

Smart Balance Inc. is committed to providing superior tasting heart healthier alternatives in every category it enters by avoiding trans fats naturally, balancing fats and/or reducing saturated fats, total fat and cholesterol. The company's products include Smart Balance(R) Buttery Spreads, Milk, Butter Blend Sticks, Cream Cheese, Peanut Butter, Microwave Popcorn, Cooking Oil, Mayonnaise, Non-Stick Cooking Spray and Cheese. Smart Balance Inc. is one of the five fastest growing food companies in the United States, according to Nielsen sales figures. For more information about products and the Smart Balance(TM) Food Plan, visit http://www.smartbalance.com.

GAAP Basis Operating Basis (unaudited except for the Form 10-K amounts) (1) (2) Add GFA Results Three Months Ended As reported For the Add Operating September 30, 2007 Form 10-Q Period Adjustments Basis Net Sales 41,625,392 41,625,392 Operating Income 5,329,821 5,329,821 Add GFA Results Three Months Ended As reported For the Add Operating September 30, 2006 Form 10-Q Period Adjustments Basis Net Sales 31,668,891 31,668,891 Operating Income (367,225) 6,371,507 367,225 6,371,507 Add GFA Results For the Period Nine Months Ended As reported 1/1/07 - Add Operating September 30, 2007 Form 10-Q 5/20/07 Adjustments Basis Net Sales 60,372,654 64,406,415 117,311 124,896,380 Operating Income 5,936,659 12,697,997 1,152,317 19,786,973 Add GFA Results Nine Months Ended As reported For the Add Operating September 30, 2006 Form 10-Q Period Adjustments Basis Net Sales 97,286,390 97,286,390 Operating Income (1,097,559) 18,101,453 1,097,559 18,101,453 Add GFA Results For the Period Three Months Ended As reported 4/1/07 - Add Operating June 30, 2007 Form 10-Q 5/20/07 Adjustments Basis Net Sales 18,747,262 23,910,536 117,311 42,775,109 Operating Income 1,279,710 5,899,197 479,453 7,658,360 Add GFA Results Three Months Ended As reported For the Add Operating June 30, 2006 Form 10-Q Period Adjustments Basis Net Sales 32,448,702 32,448,702 Operating Income (506,705) 6,609,322 506,705 6,609,322 Add GFA Results For the Period Six Months Ended As reported 1/1/07 - Add Operating June 30, 2007 Form 10-Q 5/20/07 Adjustments Basis Net Sales 18,747,262 64,406,415 117,311 83,270,988 Operating Income 606,837 12,697,997 1,152,317 14,457,151 Add GFA Results Six Months Ended As reported For the Add Operating June 30, 2006 Form 10-Q Period Adjustments Basis Net Sales - 65,617,499 65,617,499 Operating Income (730,335) 11,729,946 730,335 11,729,946 Add GFA Results Three Months Ended As reported For the Add Operating March 31, 2007 Form 10-Q Period Adjustments Basis Net Sales 40,495,879 40,495,879 Operating Income (672,873) 6,798,800 672,873 6,798,800 Add GFA Results Three Months Ended As reported For the Add Operating March 31, 2006 Form 10-Q Period Adjustments Basis Net Sales 33,168,797 33,168,797 Operating Income (223,630) 5,120,624 223,630 5,120,624 Add GFA Results Three Months Ended As reported For the Add Operating December 31, 2006 Form 10-K Period Adjustments Basis Net Sales 40,117,765 40,117,765 Operating Income (827,042) 5,953,019 827,042 5,953,019 Add GFA Results Twelve Months Ended As reported For the Add Operating December 31, 2006 Form 10-K Period Adjustments Basis Net Sales 137,404,155 137,404,155 Operating Income (1,924,602) 24,054,472 1,924,602 24,054,472 Add GFA Results Twelve Months Ended As reported For the Add Operating December 31, 2005 Form 10-K Period Adjustments Basis Net Sales 98,778,174 98,778,174 Operating Income (2,469,410) 15,275,387 2,469,410 15,275,387 (1) To add GFA Brands, Inc. results for the entire reporting period as necessary (2) To remove Smart Balance, Inc. (parent company) pre-acquisition expenses from results prior to acquisition date May 21, 2007. Parent company expenses incurred beginning May 21, 2007 remain included in operating basis results. Operating Basis: (unaudited) Nine Three Six Three Three Months Months Months Months Months Ended Ended Ended Ended Ended Sept. 30, Sept. 30, June 30, June 30, March 31, (in 000's) 2007 2007 2007 2007 2007 Net Sales 124,896.4 41,625.4 83,271.0 42,775.1 40,495.9 COGS 64,203.8 21,575.7 42,628.1 21,956.2 20,671.9 Gross Profit 60,692.6 20,049.7 40,642.9 20,818.9 19,824.0 Gross margins 48.6% 48.2% 48.8% 48.7% 49.0% Marketing 13,932.0 1,441.2 12,490.8 4,821.9 7,668.9 Selling 12,905.7 4,535.0 8,370.7 4,417.8 3,952.9 G&A 14,067.9 8,743.7 5,324.2 3,920.8 1,403.4 Total SG&A 40,905.6 14,719.9 26,185.7 13,160.6 13,025.2 Operating Income 19,787.0 5,329.8 14,457.2 7,658.4 6,798.8 % of Net Sales 15.8% 12.8% 17.4% 17.9% 16.8% Operating Income includes the following non-cash items FAS 123R Stock Options 4,777.5 3,700.2 1,077.3 1,077.3 - Depreciation 79.2 5.9 73.3 66.8 6.5 Amortization 1,481.8 1,021.9 459.9 459.9 - 6,338.5 4,727.9 1,610.5 1,604.1 6.5 Twelve Three Nine Three Months Months Months Months Ended Ended Ended Ended Dec. 31, Dec. 31, Sept. 30, Sept. 30, (in 000's) 2006 2006 2006 2006 Net Sales 137,404.2 40,117.8 97,286.4 31,668.9 COGS 69,853.3 20,722.3 49,131.0 16,014.7 Gross Profit 67,550.9 19,395.5 48,155.4 15,654.2 Gross margins 49.2% 48.3% 49.5% 49.4% Marketing 21,548.4 4,938.9 16,609.5 4,528.4 Selling 14,001.2 4,220.1 9,781.2 3,321.6 G&A 7,946.8 4,283.5 3,663.3 1,432.7 Total SG&A 43,496.4 13,442.5 30,053.9 9,282.7 Operating Income 24,054.5 5,953.0 18,101.5 6,371.5 % of Net Sales 17.5% 14.8% 18.6% 20.1% Operating Income includes the following non-cash items FAS 123R Stock Options - - - - Depreciation 25.5 6.6 18.9 6.4 Amortization - - - - 25.5 6.6 18.9 6.4 Six Three Three Twelve Months Months Months Months Ended Ended Ended Ended June 30, June 30, March 31, Dec. 31, (in 000's) 2006 2006 2006 2005 Net Sales 65,617.5 32,448.7 33,168.8 98,778.2 COGS 33,116.3 16,644.8 16,471.4 47,746.4 Gross Profit 32,501.2 15,803.9 16,697.3 51,031.8 Gross margins 49.5% 48.7% 50.3% 51.7% Marketing 12,081.1 4,845.9 7,235.3 20,839.4 Selling 6,459.6 3,267.3 3,192.3 9,388.2 G&A 2,230.6 1,081.4 1,149.2 5,528.8 Total SG&A 20,771.3 9,194.6 11,576.7 35,756.4 Operating Income 11,729.9 6,609.3 5,120.6 15,275.4 % of Net Sales 17.9% 20.4% 15.4% 15.5% Operating Income includes the following non-cash items FAS 123R Stock Options - - - - Depreciation 12.5 7.1 5.4 21.6 Amortization - - - - 12.5 7.1 5.4 21.6

Smart Balance Inc.

CONTACT: Media Contacts, Liz Feldman, +1-443-683-0917, or
feldman@hillmanpr.com , or Nicole Atkinson, +1-443-683-0922, or
natkinson@hillmanpr.com , both of Sandy Hillman Communications for Smart
Balance Inc.; or Investor Contact, John Mintz of Smart Balance Inc.,
+1-201-568-9300 ext. 127

Web site: http://www.smartbalance.com/