Nu Skin Enterprises Reports Record First-Quarter Results And Raises 2013 Guidance PR Newswire PROVO, Utah, May 2, 2013 PROVO, Utah, May 2, 2013 /PRNewswire/ --Nu Skin Enterprises, Inc. (NYSE: NUS) today announced record first-quarter results with revenue of $550.1 million, a 19 percent improvement over the prior-year period. Revenue was negatively impacted 3 percent by foreign currency fluctuations. Earnings per share for the quarter were $0.90, a 22 percent year-over-year improvement. Additionally, the company announced that it is increasing its full-year 2013 revenue guidance by $190 million to be in the $2.51 to $2.54 billion range. The new guidance includes a projected negative currency impact of 5 percent. The company now expects 2013 earnings to be in the range of $4.18 to $4.30 per share. "We kicked off the year with tremendous momentum, generating 22 percent local-currency revenue growth this quarter," said Truman Hunt, president and chief executive officer. "We are pleased with the overall direction of the business, particularly with trends in the North Asia and Greater China regions. The first quarter marked the third consecutive quarter of year-over-year local-currency growth for Japan, while South Korea continues to be a solid contributor to our success. Greater China continues to be our fastest-growing region, with each market within the region posting solid quarterly growth." Regional Results North Asia. First-quarter revenue in North Asia was $188.2 million, compared to $182.2 million for the same period in 2012. The region's results were negatively impacted 8 percent by foreign currency fluctuations. Japan local-currency revenue improved 13 percent while South Korea generated local-currency revenue growth of 9 percent. The number of sales leaders in the region was up 12 percent while the number of actives improved 8 percent. Greater China. In Greater China, first-quarter revenue increased 90 percent to $175.7 million, compared to $92.6 million in the prior-year period. The region's results were positively impacted 2 percent by foreign currency fluctuations. Mainland China local-currency revenue grew 141 percent. The sales leader count in the region improved 91 percent, while the number of actives increased 73 percent compared to the prior year. Americas. Revenue in the Americas improved 15 percent to $76.5 million, compared to $66.3 million in the prior-year period. The region's results were negatively impacted 3 percent by foreign currency fluctuations. U.S. revenue grew by 7 percent during the quarter. The number of sales leaders in the region improved 9 percent while the number of actives decreased 4 percent compared to the prior year. South Asia/Pacific. Revenue in South Asia/Pacific was $67.2 million, a 13 percent decline compared to the prior year. Excluding the prior-year's product launch sales, revenue would have been up 8 percent. The region's results were not materially impacted by foreign currency fluctuations. The region's first-quarter sales leaders improved 9 percent while actives increased 8 percent compared to the same period in 2012. EMEA. Revenue in the EMEA region was $42.4 million, a 3 percent decline over the prior-year period. The region's results were not materially impacted by foreign currency fluctuations. Sales leaders and actives increased 1 and 5 percent, respectively, compared to the prior year. Operational Performance The company's operating margin was 15.0 percent for the quarter, compared to 15.5 percent in the prior year. The decrease in operating margin was primarily a result of planned brand-building efforts in Greater China and Japan as well as increased research and development expenditures. The company projects an operating margin of 15.8 to 16.1 percent for the year. Gross margin during the quarter was 83.6 percent, consistent with the prior year. Selling expenses, as a percent of revenue, were 44.0 percent in the first quarter, compared to 43.8 percent in the prior-year period. General and administrative expenses, as a percent of revenue, were 24.6 percent, up slightly from 24.3 percent reported in the prior-year period. Other income (expense), net reflected a gain of $0.1 million compared to a gain of $3.6 million in the prior year. The company's income tax rate for the quarter was 34.4 percent compared to 36.5 percent in the prior-year period. The company's cash and short-term investment position at the end of the quarter was $334.3 million. Dividend payments during the quarter were $17.5 million, and the company repurchased $14.6 million of its outstanding shares. Outlook "Given the positive momentum of the business, we are on track to achieve another record year of revenue and earnings," said Hunt. "Our anti-aging product portfolio continues to drive strong consumer demand and impressive growth in our global sales force. "The ageLOC product platform has become a game-changer for Nu Skin, and we believe this fall's introduction of the ageLOC weight management system will be a meaningful growth driver in our business. We are currently training and preparing our sales force for the limited-time-offer in the second half of the year, and believe the launch will be the largest in company history," Hunt concluded. "Given the strength of our business, as well as the optimism we have for the upcoming ageLOC weight management system, we are significantly raising our 2013 guidance," said Ritch Wood, chief financial officer. "Our increased guidance accounts for a stronger-than-expected currency headwind, which we now forecast will negatively impact revenue for the year by approximately 5 percent, an increase of 1 to 2 percent from our previous guidance. We project second-quarter 2013 revenue to be in the $570 to $580 million range with a negative currency impact of 4 to 5 percent, and earnings per share to be $0.91 to $0.95. For the full year, we anticipate revenue will be in the $2.51 to $2.54 billion range with earnings per share to be $4.18 to $4.30." The company's management will host a webcast with the investment community on May 2, 2013, at 11 a.m. EST. Those wishing to access the webcast, as well as the financial information presented during the call, can visit the Investor Relations page on Nu Skin Enterprises' website, http://ir.nuskin.com. An archive of the webcast will be available at this same URL through May 17, 2013. About Nu Skin Enterprises, Inc. Nu Skin Enterprises, Inc. demonstrates its tradition of innovation through its comprehensive anti-aging product portfolio, independent business opportunity and corporate social responsibility initiatives. The company's scientific leadership in both skin care and nutrition has established Nu Skin as a premier anti-aging company. The company's anti-aging products feature the new ageLOC^® suite of products including the ageLOC^® R^2 nutritional supplement, ageLOC^® Galvanic Spa System and ageLOC^® Galvanic Body Spa™, as well as the ageLOC^® Transformation daily skin care system. A global direct selling company, Nu Skin operates in 53 markets worldwide and is traded on the New York Stock Exchange under the symbol "NUS." More information is available at http://www.nuskin.com. Please Note: This press release, particularly the "Outlook" section, contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended that represent the company's current expectations and beliefs. All statements other than statements of historical fact are "forward-looking statements" for purposes of federal and state securities laws and include, but are not limited to, statements of management's expectations regarding the company's performance, initiatives, strategies and new product introductions; statements of projections regarding revenue, operating margin, earnings per share, foreign currency impact and other financial items; statements of belief; and statements of assumptions underlying any of the foregoing. In some cases, you can identify these statements by forward-looking words such as "believe," "expect," "project," "anticipate," "estimate," "intend," "plan," "targets," "likely," "will," "would," "could," "may," "might," the negative of these words and other similar words. The forward-looking statements and related assumptions involve risks and uncertainties that could cause actual results and outcomes to differ materially from any forward-looking statements or views expressed herein. These risks and uncertainties include, but are not limited to, the following: oany failure of current or planned initiatives or products to generate interest among distributors and customers and generate sponsoring and selling activities on a sustained basis; orisks related to accurately predicting, delivering or maintaining sufficient quantities of products to support our planned initiatives or launch strategies, including possible ingredient supply limitations; ochallenging economic conditions globally; orisk of foreign currency fluctuations and the currency translation impact on the company's business associated with these fluctuations; orisks associated with general inquiries and complaints to consumer protection agencies in Japan regarding the activities of some distributors; oregulatory risks associated with the company's products, which could require the company to modify its claims or inhibit the company's ability to import or continue selling a product in a market if it is determined to be a medical device or if it is unable to register the product in a timely manner under applicable regulatory requirements; ocontinued regulatory scrutiny and investigations in Mainland China, which have from time to time in the past, and could in the future, negatively impact the company's business, including the interruption of sales activities in stores, loss of licenses, and the imposition of fines; oadverse publicity related to the company's business, products, industry or any legal actions or complaints by distributors or others; oany prospective or retrospective increases in duties on the company's products imported into the company's markets outside of the United States and any adverse results of tax audits or unfavorable changes to tax laws in the company's various markets; and ocontinued competitive pressures in the company's markets. The company's financial performance and the forward-looking statements contained herein are further qualified by a detailed discussion of associated risks set forth in the documents filed by the company with the Securities and Exchange Commission. The forward-looking statements set forth the company's beliefs as of the date that such information was first provided and the company assumes no duty to update the forward-looking statements contained in this release to reflect any change except as required by law. NU SKIN ENTERPRISES, INC. Consolidated Statements of Income (Unaudited) For the First Quarters Ended March 31, 2013 and 2012 (in thousands, except per share amounts) 2013 2012 Revenue: North Asia $ $ 188,193 182,200 Greater China 175,706 92,611 Americas 76,541 66,340 South Asia/Pacific 67,242 77,321 EMEA 42,412 43,530 Total revenue 550,094 462,002 Cost of sales 90,045 75,756 Gross profit 460,049 386,246 Operating expenses: Selling expenses 241,883 202,535 General and administrative 135,507 112,048 expenses Total operating expenses 377,390 314,583 Operating income 82,659 71,663 Other income (expense), net 112 3,635 Income before provision for income 82,771 75,298 taxes Provision for income taxes 28,489 27,469 Net income $ $ 54,282 47,829 Net income per share: Basic $ $ 0.93 0.77 Diluted $ $ 0.90 0.74 Weighted average common shares outstanding: Basic 58,352 62,230 Diluted 60,566 65,017 NU SKIN ENTERPRISES, INC. Consolidated Balance Sheets (Unaudited) (in thousands) March 31, 2013 December 31, 2012 ASSETS Current assets: Cash and cash equivalents $ $ 325,720 320,025 Current investments 8,534 13,378 Accounts receivable 43,809 36,850 Inventories, net 149,089 135,874 Prepaid expenses and other 92,151 93,276 619,303 599,403 Property and equipment, net 264,363 229,787 Goodwill 112,446 112,446 Other intangible assets, net 89,922 92,518 Other assets 121,759 118,753 Total assets $ $ 1,207,793 1,152,907 LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities: Accounts payable $ $ 52,255 47,882 Accrued expenses 250,583 233,202 Current portion of long-term debt 56,531 39,019 359,369 320,103 Long-term debt 138,782 154,963 Other liabilities 92,939 87,229 Total liabilities 591,090 562,295 Stockholders' equity: Class A common stock 91 91 Additional paid-in capital 319,802 317,293 Treasury stock, at cost (724,489) (714,853) Accumulated other comprehensive (55,372) (51,822) loss Retained earnings 1,076,671 1,039,903 616,703 590,612 Total liabilities and $ $ stockholders' equity 1,207,793 1,152,907 NU SKIN ENTERPRISES, INC. Actives/Sales Leaders Statistics As of March 31, 2013 As of March 31, % Increase 2012 (Decrease) Actives Sales Actives Sales Actives Sales Leaders Leaders Leaders North Asia 361,000 16,682 335,000 14,900 7.8% 12.0% Greater China 261,000 22,011 151,000 11,551 72.8% 90.6% Americas 163,000 6,273 170,000 5,776 (4.1%) 8.6% South 98,000 5,337 91,000 4,911 7.7% 8.7% Asia/Pacific EMEA 119,000 4,118 113,000 4,076 5.3% 1.0% Total 1,002,000 54,421 860,000 41,214 16.5% 32.0% "Actives" are persons who purchased products directly from the company during the previous three months. "Sales Leaders" include our independent distributors who have completed and who maintain specified sales requirements, and our sales employees and contractual sales promoters in China, who have completed certain qualification requirements. SOURCE Nu Skin Enterprises, Inc. Website: http://www.nuskinenterprises.com Contact: Investors, Scott Pond (801) 345-2657, firstname.lastname@example.org; Media, Kara Schneck (801) 345-2116, email@example.com
Nu Skin Enterprises Reports Record First-Quarter Results And Raises 2013 Guidance
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