Nautilus 2001 Annual Report Download - page 5

StairMaster, we believe that we have made significant progress in diversifying our product line and expanding our presence internationally. We
now offer a comprehensive line of cardiovascular and weight resistance products in the retail and commercial fitness industry. Our retail and
commercial product lines include home gyms, free weight equipment, treadmills, indoor cycling equipment, steppers and ellipticals. As a result
of our acquisitions, we have also added operations in Switzerland, Germany and England, a sales office in Japan, and a worldwide network of
distributors.
We believe that our Company possesses distinct competitive advantages as it builds towards its goal of being a complete provider of products
to the health and fitness industry. We continue to develop a portfolio of highly recognized and trusted fitness brands. These brands are utilized,
in concert with tailored product development, to meet the differing customer demands of each distribution channel: direct, commercial and
retail. In addition, we have realized, and believe that we will continue to realize, significant synergies by leveraging our brands, marketing
resources, and research and development capabilities across all three distribution channels. We believe the health and fitness industry's
fragmentation of manufacturers and distribution channels lends itself to the execution of this strategy.
For a discussion of financial information about our two business segments, direct products and commercial/retail products, see Note 2 of the
Notes to Consolidated Financial Statements.
Direct Focus was incorporated in California in 1986 and became a Washington corporation in 1993. Our principal executive offices are located
at 1400 NE 136th Avenue, Vancouver, Washington 98684, and our telephone number is
[phone]. We maintain our corporate web site at www.directfocusinc.com. None of the information on this web site or our other web
sites is part of this Form 10-K.
As used in this Form 10-K, the terms "we," "our," "us," "Direct Focus" and "Company" refer to Direct Focus, Inc. and its subsidiaries. The
names Nautilus(R), Bowflex(R), Bowflex Power-Pro(R), Motivator(R), Versatrainer(R), Power Rod(R), Direct Focus(R), Instant Comfort(R),
Nautilus Sleep Systems(R), Airdyne(R), Fitness Advisor(R), StairMaster(R), and Trimline(R) are registered trademarks of Direct Focus, Inc.
The consolidated financial statements of the Company include Direct Focus, Inc., Nautilus HPS, Inc., Nautilus, Inc., DFI Properties, LLC, BFI
Advertising, Inc., DFI Sales, Inc., DFI Leaseco, LLC, Nautilus Fitness Products, Inc., Nautilus/Schwinn Fitness Group, Inc., DF Hebb
Industries, Inc., Schwinn Fitness International SA, Schwinn Holdings International SA, and Schwinn Fitness SA. All intercompany transactions
have been eliminated in the preparation of the consolidated financial statements. While StairMaster is discussed throughout this document due
to its significance to our business strategy, its financial results are not included in our financial statements as it was acquired subsequent to year
end 2001.
LONG-TERM STRATEGY
Our long-term strategy is to build a complete health and fitness company offering high quality, premium-branded products enabling health
conscious consumers to maintain active lifestyles. We intend to do this by:
o Utilizing our positioning and capabilities in the direct marketing channel to launch new, innovative products;
o Capitalizing on the synergy and growth opportunities from acquisitions;
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