A one-time tax reversal of $3.0 million helped boost Nautilus’ net income by 13 percent to $9,376,000 in the 3rd quarter ended Sept. 30. The company also had a stock option expense of $480,000. Without these two extraordinary items, net income would have dipped to $6.4 million, as compared to $7.7 million in the year-ago period. Turnover fell in most of the company’s divisions during the quarter, but thedeclines were partly due to a planned sales shortfall of $8 million related to the cutting off of less profitable customers and the elimination of less profitable products. Another $5 million in turnover is being deferred to the 4th quarter. Sales outside of the USA were up by 3 percent to $14.6 million. Apparel sales rose by 10.6 percent to $16.7 million. The gross margin grew by 91 basis points to 45.18 percent. Nautilus expects full year sales to increase by 10 percent, including turnover of $190-210 million in the 4th quarter. Net income for the year is projected to climb by 22-32 percent. The company expects this growth trend to continue in 2007.