PROVO, Utah, Feb. 16, 2017 /PRNewswire/ -- Nu Skin
Enterprises, Inc. (NYSE: NUS) today announced fourth-quarter
results with revenue of $531.3
million, compared to $572.2
million in the prior-year period. Quarterly revenue was
negatively impacted 1 percent by foreign currency fluctuations.
Earnings per share for the quarter were $0.69, compared to $0.62 in the prior-year period. The company's
earnings per share in the fourth quarter included a negative
$0.10 impact from a tax charge
related to the enactment of a new U.S. tax regulation in
December.
The company also reported full-year 2016 revenue of $2.21
billion, compared to $2.25 billion in
2015. Annual revenue was approximately even on a
local-currency basis but was negatively impacted 2 percent by a
strong U.S. dollar. Earnings per share for 2016
were $2.55, compared to $2.25 in 2015.
The company also reiterated guidance provided at its 2016
investor day in December with anticipated revenue of $2.26 to $2.30 billion and earnings per share of
$3.10 to $3.25, assuming a 3 to 4
percent negative foreign currency impact.
"The fourth quarter of 2016 showed a decline against 2015 due to
approximately $50 million of product
launch revenue in the fourth quarter of 2015," said Truman Hunt, president and chief executive
officer. "Revenue in the fourth quarter of 2016 was also negatively
impacted by $7 million of deferred
revenue, primarily from a stronger-than-anticipated response to a
promotion of ageLOC Me cartridges in China where orders outstripped our supply.
"For the year, we were pleased to generate continued improvement
in local currency revenue results. We made significant progress
executing our 2016 priorities, including growing in China, successfully launching our ageLOC Me
and ageLOC Youth products, and finalizing development of our
upcoming LumiSpa product. We believe these steps have positioned us
for growth in 2017 and beyond. We are excited by the opportunities
ahead, which we believe will create value for our
shareholders."
Regional Results
The Company's regional revenue results for the three-month
periods ended December 31 are
presented in the following table (in thousands).
|
|
2016
|
|
2015
|
|
%
Change
|
|
Constant
Currency
%
Change
|
|
|
|
|
|
|
|
|
|
Greater
China
|
|
$
182,506
|
|
$
195,495
|
|
(7%)
|
|
(2%)
|
North Asia
|
|
166,967
|
|
173,798
|
|
(4%)
|
|
(8%)
|
South
Asia/Pacific
|
|
70,016
|
|
74,274
|
|
(6%)
|
|
(7%)
|
Americas
|
|
71,708
|
|
95,553
|
|
(25%)
|
|
(23%)
|
EMEA
|
|
40,132
|
|
33,078
|
|
21%
|
|
23%
|
|
|
|
|
|
|
|
|
|
Total
|
|
$
531,329
|
|
$
572,198
|
|
(7%)
|
|
(6%)
|
The Company's regional revenue results for the years ended
December 31 are presented in the
following table (in thousands).
|
|
2016
|
|
2015
|
|
%
Change
|
|
Constant
Currency
%
Change
|
|
|
|
|
|
|
|
|
|
Greater
China
|
|
$
794,393
|
|
$
771,667
|
|
3%
|
|
8%
|
North Asia
|
|
692,738
|
|
686,555
|
|
1%
|
|
(2%)
|
South
Asia/Pacific
|
|
296,758
|
|
321,971
|
|
(8%)
|
|
(6%)
|
Americas
|
|
276,590
|
|
329,668
|
|
(16%)
|
|
(13%)
|
EMEA
|
|
147,318
|
|
137,186
|
|
7%
|
|
8%
|
|
|
|
|
|
|
|
|
|
Total
|
|
$
2,207,797
|
|
$
2,247,047
|
|
(2%)
|
|
---*
|
The company's regional customers and sales leaders statistics
are presented in the following table.
|
2016
|
|
2015
|
|
% Increase
(Decrease)
|
|
|
Customers
|
|
Sales
Leaders
|
|
Customers
|
|
Sales
Leaders
|
|
Customers
|
|
Sales
Leaders
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Greater
China
|
|
248,000
|
|
26,625
|
|
223,000
|
|
27,064
|
|
11.2%
|
|
(1.6%)
|
North Asia
|
|
329,000
|
|
16,330
|
|
366,000
|
|
17,415
|
|
(10.1%)
|
|
(6.2%)
|
South
Asia/Pacific
|
|
116,000
|
|
7,584
|
|
119,000
|
|
10,476
|
|
(2.5%)
|
|
(27.6%)
|
Americas
|
|
166,000
|
|
6,683
|
|
176,000
|
|
8,708
|
|
(5.7%)
|
|
(23.3%)
|
EMEA
|
|
129,000
|
|
4,405
|
|
110,000
|
|
3,912
|
|
17.3%
|
|
12.6%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
988,000
|
|
61,627
|
|
994,000
|
|
67,575
|
|
(0.6%)
|
|
(8.8%)
|
|
|
|
|
"Customers,"
previously referred to as "Actives," are persons who purchased
products directly from the company during the previous three
months.
|
"Sales
Leaders" are independent distributors, and sales employees and
independent marketers in China, who achieve certain qualification
requirements.
|
Operational Performance
The company's operating margin improved to 11.4 percent,
compared to 10.8 percent in the prior-year period. Gross margin for
the quarter was 79.6 percent, compared to 78.8 percent in the
prior-year quarter. Selling expenses, as a percent of revenue, were
42.0 percent, compared to 41.5 percent in the fourth quarter of
2015. General and administrative expenses, as a percent of revenue,
were 26.2 percent, compared to 26.5 percent in the prior-year
period. The company's effective income tax rate for the quarter was
38.5 percent, compared to 38.7 percent in the fourth quarter of
last year, with the fourth quarter of 2016 being negatively
impacted by the enactment of a new U.S. tax regulation in December,
but was partially offset by other tax benefits. The company does
not anticipate that these adjustments will materially impact its
tax rate in future periods. Dividend payments during the quarter
were $18.9 million, and the company
repurchased $205.5 million of its
outstanding shares, leaving approximately $200 million authorized to repurchase shares.
Management Transition
The company also provided an update on its previously announced
management transition. The company expects to name a new chief
financial officer in the next few weeks. At that time, Truman Hunt will become vice chairman of the
board of directors. On the same date, Ritch
Wood will assume the position of chief executive officer,
and Ryan Napierski will become the
company's president.
"I am optimistic about the future of Nu Skin," said Hunt. "I
have worked closely with Ritch and Ryan for the past 15 years and
have complete confidence that they have the experience, leadership
and vision to take our business to the next level."
Outlook
"Moving into 2017, we remain focused on executing the
initiatives we outlined in our investor day presentation," said
Ritch Wood, chief financial officer.
"We have refined our product launch strategy to grow our sales
leaders and customer base with our latest ageLOC products. We are
confident that this approach will allow us to generate improved
results, with projected local currency revenue growth of 4 to 6
percent in 2017. Given our success with at-home treatment devices,
we are particularly optimistic about the launch of our new
cleansing and treatment device, LumiSpa, which we will introduce at
our global convention in October.
"For the first quarter, we anticipate revenue of $480 to $500 million, assuming a 1 to 2 percent
negative impact from foreign currency," continued Wood. "We project
first quarter earnings per share of $0.47 to
$0.51. For 2017, we reiterate our guidance, with revenue of
$2.26 to $2.30 billion and earnings
per share of $3.10 to $3.25, assuming
a 3 to 4 percent negative foreign currency impact."
The Nu Skin management team will host a conference call with the
investment community on Feb. 16 at
5 p.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 the company's
website at ir.nuskin.com. A replay of the webcast will be
available at the same URL through March 3,
2017.
About Nu Skin Enterprises, Inc.
Founded more than 30 years ago, Nu Skin Enterprises, Inc.
develops and distributes innovative consumer products, offering a
comprehensive line of premium-quality beauty and wellness
solutions. The company builds upon its scientific expertise in both
skin care and nutrition to continually develop innovative product
brands that include the Nu Skin® personal care brand,
the Pharmanex® nutrition brand, and most recently, the
ageLOC® anti-aging brand. The ageLOC brand has generated
a loyal following for such products as the ageLOC Youth nutritional
supplement, the ageLOC Me® customized skin care system,
as well as the ageLOC TR90® weight management and body
shaping system. Nu Skin sells its products through a global network
of sales leaders in Asia, the
Americas, Europe, Africa and the Pacific. As a long-standing
member of direct selling associations globally, Nu Skin is
committed to the industry's consumer guidelines that protect and
support those who sell and purchase its products through the direct
selling channel. Nu Skin is also traded on the New York Stock
Exchange under the symbol "NUS." More information is available at
nuskin.com.
Please Note: This press release 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 future management, performance, sales force
and customer base, growth, initiatives and new product
introductions; projections regarding revenue, earnings per share,
foreign currency fluctuations, 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:
- any failure of current or planned initiatives or products to
generate interest among our sales force and customers and generate
sponsoring and selling activities on a sustained basis;
- risk of foreign currency fluctuations and the currency
translation impact on the company's business associated with these
fluctuations;
- risk that direct selling laws and regulations in any of our
markets, including the United
States and China, may be
modified, interpreted or enforced in a manner that results in
negative changes to our business model or negatively impacts our
revenue, sales force or business, including through the
interruption of sales activities, loss of licenses, imposition of
fines, or any other adverse actions or events;
- risks related to accurately predicting, delivering or
maintaining sufficient quantities of products to support our
planned initiatives or launch strategies, and increased risk of
inventory write-offs if we over-forecast demand for a product or
change our planned initiatives or launch strategies;
- regulatory 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;
- inability to retain our management due to personal reasons
or competitive pressures;
- adverse publicity related to the company's business,
products, industry or any legal actions or complaints by the
company's sales force or others;
- unpredictable economic conditions and events
globally;
- any 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 favorable changes to tax laws in the
company's various markets; and
- continued 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.
Non-GAAP Financial
Measures: Constant-currency revenue growth is a
non-GAAP financial measure that removes the impact of fluctuations
in foreign-currency exchange rates, thereby facilitating
period-to-period comparisons of the company's performance. It
is calculated by translating the current period's revenue at the
same average exchange rates in effect during the applicable
prior-year period and then comparing this amount to the prior-year
period's revenue.
NU SKIN
ENTERPRISES, INC.
|
Consolidated
Statements of Income (Unaudited)
|
For the Fourth
Quarters Ended December 31, 2016 and 2015
|
(in thousands, except
per share amounts)
|
|
|
|
|
|
2016
|
|
2015
|
|
|
|
|
Revenue
|
$
531,329
|
|
$
572,198
|
|
|
|
|
Cost of
sales
|
108,520
|
|
121,437
|
|
|
|
|
Gross
profit
|
422,809
|
|
450,761
|
|
|
|
|
Operating
expenses:
|
|
|
|
Selling
expenses
|
222,887
|
|
237,658
|
General
and administrative expenses
|
139,139
|
|
151,389
|
Total operating
expenses
|
362,026
|
|
389,047
|
|
|
|
|
Operating
income
|
60,783
|
|
61,714
|
|
|
|
|
Other
(expense)/income, net
|
1,353
|
|
(3,289)
|
Income before
provision for income taxes
|
62,136
|
|
58,425
|
Provision for income
taxes
|
23,951
|
|
22,585
|
|
|
|
|
Net
income
|
$
38,185
|
|
$
35,840
|
|
|
|
|
Net income per
share:
|
|
|
|
Basic
|
$
0.71
|
|
$
0.63
|
Diluted
|
$
0.69
|
|
$
0.62
|
|
|
|
|
Weighted average
common shares outstanding:
|
|
|
|
Basic
|
53,769
|
|
56,792
|
Diluted
|
55,539
|
|
57,524
|
NU SKIN
ENTERPRISES, INC.
|
Consolidated
Statements of Income (Unaudited)
|
For the Years
Ended December 31, 2016 and 2015
|
(in thousands, except
per share amounts)
|
|
|
|
|
|
2016
|
|
2015
|
|
|
|
|
Revenue
|
$
2,207,797
|
|
$
2,247,047
|
|
|
|
|
Cost of
sales
|
500,457
|
|
489,510
|
|
|
|
|
Gross
profit
|
1,707,340
|
|
1,757,537
|
|
|
|
|
Operating
expenses:
|
|
|
|
Selling
expenses
|
922,083
|
|
951,372
|
General
and administrative expenses
|
554,153
|
|
561,463
|
Total operating
expenses
|
1,476,236
|
|
1,512,835
|
|
|
|
|
Operating
income
|
231,104
|
|
244,702
|
|
|
|
|
Other
(expense)/income, net
|
(18,265)
|
|
(32,743)
|
Income before
provision for income taxes
|
212,839
|
|
211,959
|
Provision for income
taxes
|
69,753
|
|
78,913
|
|
|
|
|
Net
income
|
$
143,086
|
|
$
133,046
|
|
|
|
|
Net income per
share:
|
|
|
|
Basic
|
$
2.58
|
|
$
2.29
|
Diluted
|
$
2.55
|
|
$
2.25
|
|
|
|
|
Weighted average
common shares outstanding:
|
|
|
|
Basic
|
55,412
|
|
57,997
|
Diluted
|
56,097
|
|
59,057
|
NU SKIN
ENTERPRISES, INC.
|
Consolidated
Balance Sheets (Unaudited)
|
As of December 31,
2016 and 2015
|
(in
thousands)
|
|
|
|
|
|
2016
|
|
2015
|
ASSETS
|
|
|
|
Current
assets:
|
|
|
|
Cash and
cash equivalents
|
$
357,246
|
|
$
289,354
|
Current
investments
|
10,880
|
|
14,371
|
Accounts receivable
|
31,199
|
|
35,464
|
Inventories, net
|
249,936
|
|
265,256
|
Prepaid expenses and
other
|
65,076
|
|
101,947
|
|
714,337
|
|
706,392
|
|
|
|
|
Property and
equipment, net
|
444,732
|
|
454,537
|
Goodwill
|
114,954
|
|
112,446
|
Other intangible
assets, net
|
63,553
|
|
67,009
|
Other
assets
|
136,469
|
|
165,459
|
Total
assets
|
$
1,474,045
|
|
$
1,505,843
|
|
|
|
|
LIABILITIES AND
STOCKHOLDERS' EQUITY
|
|
|
|
Current
liabilities:
|
|
|
|
Accounts
payable
|
$
41,261
|
|
$
28,832
|
Accrued
expenses
|
275,023
|
|
310,916
|
Current portion of long-term debt
|
82,727
|
|
67,849
|
|
399,011
|
|
407,597
|
|
|
|
|
Long-term
debt
|
334,165
|
|
181,745
|
Other
liabilities
|
76,799
|
|
90,880
|
Total
liabilities
|
809,975
|
|
680,222
|
|
|
|
|
Stockholders'
equity:
|
|
|
|
Class A
common stock
|
91
|
|
91
|
Additional
paid-in capital
|
439,635
|
|
419,921
|
Treasury stock,
at cost
|
(1,250,123)
|
|
(1,017,063)
|
Accumulated
other comprehensive loss
|
(84,122)
|
|
(71,269)
|
Retained
earnings
|
1,558,589
|
|
1,493,941
|
|
664,070
|
|
825,621
|
Total liabilities and stockholders'
equity
|
$
1,474,045
|
|
$
1,505,843
|
To view the original version on PR Newswire,
visit:http://www.prnewswire.com/news-releases/nu-skin-enterprises-reports-fourth-quarter-and-2016-results-reiterates-2017-growth-projections-300409139.html
SOURCE Nu Skin Enterprises, Inc.