Reports 12.5% sequential fourth quarter
revenue growth
LifeVantage Corporation (Nasdaq:LFVN) today reported financial
results for its fourth quarter and full year ended June 30,
2017.
“We finished fiscal 2017 on a strong note,
posting 12.5% sequential revenue growth compared to the third
quarter,” stated LifeVantage President and Chief Executive Officer
Darren Jensen. “I am excited about the progress we have and are
making against each of our key focus areas. We are in a
transformational period where we are building the assets to
transform our business model into a technology powered solution for
both distributors and consumers with enhanced tools, product
solutions and business development activities. As fiscal 2018
progresses, we will be rolling out a series of initiatives that
support each of our key focus areas, investing in technologies that
set us apart from our peers and investing in our distribution
network. We are laying the groundwork for both near-term growth and
long-term success in a new economy with consumers that are more
engaged and empowered than ever to leverage the LifeVantage
offerings.”
Fourth Quarter Fiscal 2017
Highlights:
- Revenue increased 12.5% sequentially to $50.6 million when
compared to $45.0 million in the third quarter of fiscal 2017 and
decreased 4.5% when compared to $53.0 million in the fourth quarter
of fiscal 2016;
- Revenue in the Americas increased 12.6% and revenue in
Asia/Pacific & Europe increased 12.2%, both when compared
sequentially to the third quarter of fiscal 2017. On a year over
year basis, revenue in the Americas decreased 2.0% and revenue in
Asia/Pacific & Europe decreased 11.9%. However, revenue in
Japan increased 6.7% year over year;
- Active independent distributors and active preferred customers
increased 1.6% and 0.9%, respectively, when compared to the third
quarter of fiscal 2017;
- Adjusted EBITDA increased 100.6% to $3.3 million when compared
to $1.6 million in the third quarter of fiscal 2017 and decreased
41.7% when compared to $5.6 million in the comparable period of
fiscal 2016;
- Earnings per diluted share were $0.01, compared to $0.00 in the
third quarter of fiscal 2017 and $0.17 in the fourth quarter of
fiscal 2016;
- Adjusted earnings per diluted share were $0.04, compared to
$0.02 in the third quarter of fiscal 2017 and $0.23 in the fourth
quarter of fiscal 2016; and
- On September 1, 2017, the Company officially opened for
business in Germany, the fourth largest direct selling market
globally.
Fiscal Year 2017
Highlights:
- Revenue decreased 3.4% to $199.5 million, compared to $206.5
million in fiscal 2016;
- Revenue in the Americas decreased 4.7% and revenue in
Asia/Pacific & Europe increased 0.8%, both when compared to
fiscal 2016;
- Adjusted EBITDA decreased 33.4% to $13.1 million, compared to
$19.7 million for fiscal 2016;
- Earnings per diluted share were $0.11, compared to $0.42 in
fiscal 2016; and
- Adjusted earnings per diluted share were $0.27, compared to
$0.64 in fiscal 2016.
Fourth Quarter Fiscal 2017
Results
For the fourth fiscal quarter ended June 30,
2017, the Company reported revenue of $50.6 million a decrease of
4.5% as compared to $53.0 million in the comparable period in
fiscal 2016. Revenue in the Americas for the fourth quarter
decreased 2.0% compared to the fourth quarter of fiscal 2016.
Revenue in the Asia/Pacific & Europe region decreased 11.9%
compared to the fourth quarter of fiscal 2016. However, revenue in
Japan increased by 6.7% compared to the fourth quarter of fiscal
2016. Revenue for the fourth fiscal quarter ended June 30,
2017, was negatively impacted $0.4 million, or 0.7%, by foreign
currency fluctuations associated with revenue generated in several
international markets when compared to the fourth quarter of fiscal
2016.
Gross profit for the fourth quarter of fiscal
2017 was $41.8 million, or 82.4% of revenue, compared to $43.6
million, or 82.3% of revenue, for the same period in fiscal 2016.
Commissions and incentives expense for the fourth quarter of fiscal
2017 was $24.0 million, or 47.4% of revenue, compared to $25.6
million, or 48.3% of revenue, for the same period in fiscal 2016.
Selling, general and administrative expense (SG&A) for the
fourth quarter of fiscal 2017 was $16.2 million, or 32.0% of
revenue, compared to $14.0 million, or 26.3% of revenue, in the
comparable period of fiscal 2016.
Operating income for the fourth quarter of
fiscal 2017 was $1.5 million, compared to $4.1 million for the
fourth quarter of fiscal 2016. Operating income during the fourth
quarter of fiscal 2017 included approximately $0.2 million for
expenses associated with executive team recruiting and transition
expenses, $0.1 million of class-action lawsuit expense and $0.2
million of other nonrecurring legal expenses. Adjusted EBITDA was
$3.3 million for the fourth quarter of fiscal 2017, compared to
$5.6 million for the comparable period in fiscal 2016.
Net income for the fourth quarter of fiscal 2017
was $0.1 million, or $0.01 per diluted share. This compares
to net income for the fourth quarter of fiscal 2016 of $2.4
million, or $0.17 per diluted share. Adjusted for net recruiting
and transition expenses of $0.2 million, class-action lawsuit
expense of $0.1 million, other nonrecurring legal expenses of $0.2
million, and a write off of intangible assets of $0.4 million, net
of $0.4 million of tax impacts of these adjustments, adjusted
Non-GAAP net income was $0.5 million for the fourth quarter of
fiscal 2017, or $0.04 per diluted share; compared to $3.3 million,
or $0.23 per diluted share for the comparable period of fiscal
2016. Non-GAAP adjustments to net income during the fourth quarter
of fiscal 2016 included a write-off of capitalized software
development costs of $1.2 million, net of $0.4 million of tax
impacts.
Fiscal 2017 Full Year
Results
For the fiscal year ended June 30, 2017, the
Company reported net revenue of $199.5 million, a decrease of 3.4%
compared to $206.5 million for fiscal 2016. In fiscal 2017, revenue
in the Americas decreased 4.7%, while revenue in Asia/Pacific &
Europe increased 0.8%. Revenue for fiscal 2017 was positively
impacted $2.4 million, or 1.2%, by foreign currency fluctuations
which is related primarily to our Asia/Pacific & Europe
region.
Gross profit for fiscal 2017 was $166.0 million,
or 83.2% of revenue, compared to $172.6 million, or 83.6% of
revenue, for fiscal 2016. Commissions and incentives expense for
fiscal 2017 was $96.7 million, or 48.5% of revenue, compared to
$103.1 million, or 49.9% of revenue, for fiscal 2016. SG&A for
fiscal 2017 was $64.9 million, or 32.5% of revenue, compared to
$56.1 million, or 27.1% of revenue, for fiscal 2016.
Operating income for fiscal 2017 was $4.4
million, compared to $13.4 million for fiscal 2016. Operating
income for the fiscal year ended June 30, 2017 includes $2.7
million for expenses associated with the Audit Committee
independent review, $0.8 million for executive severance,
recruiting and transition expenses, $0.2 million of class-action
lawsuit expense and $0.2 million of other nonrecurring legal
expenses. Operating income for fiscal 2016 includes $1.7 million of
executive transition expenses and costs associated with the reverse
stock split during fiscal 2016. Adjusted EBITDA was $13.1 million
for fiscal 2017, compared to $19.7 million for fiscal 2016.
Net income for fiscal 2017 was $1.6 million, or
$0.11 per diluted share, compared to $6.1 million, or $0.42 per
diluted share for fiscal 2016. Adjusting for previously announced
expenses associated with the audit committee independent review of
$2.7 million, $0.8 million of costs for net executive severance,
recruiting and transition expenses, $0.2 million of class-action
lawsuit expense, $0.2 million of other nonrecurring legal expenses
and a write-off of intangible assets of $0.4 million, net of $1.9
million of tax impacts of these adjustments, adjusted Non-GAAP net
income for the fiscal year ended June 30, 2017 was $3.9 million, or
$0.27 per diluted share. Adjusting for executive transition and
severance expenses and costs associated with the reverse stock
split of $1.7 million, collectively, along with a $1.2 million
write-off of capitalized software development costs and a $1.5
million write-off of deferred debt transaction costs, net of $1.3
million of tax impacts of these adjustments, adjusted Non-GAAP net
income for fiscal 2016 was $9.2 million or $0.64 per diluted
share.
Balance Sheet &
Liquidity
The Company generated $6.6 million of cash from
operations during fiscal 2017 compared to $6.0 million in fiscal
2016. The year-over-year increase in cash provided by operations
during fiscal 2017 relates to working capital improvements made
during this year, primarily a reduction of inventory and prepaid
deposits partially offset by decreases in accounts payable and
income tax liabilities. The Company's cash and cash equivalents at
June 30, 2017 were $11.5 million, an increase of $3.6 million when
compared to $7.9 million at June 30, 2016. Total debt at June 30,
2017 was $7.4 million compared to $9.4 million at June 30,
2016.
Fiscal Year 2018 Guidance
The Company expects to generate revenue in the
range of $206 million to $212 million in fiscal year 2018 and
anticipates diluted earnings per share in the range of $0.40 to
$0.50.
Revised Results
The financial information included herein has
been revised to correct immaterial errors present in prior periods.
See the Company's Form 10-K for a summary of the revisions.
Conference Call Information
The Company will hold an investor conference
call today at 2:30 p.m. MDT (4:30 p.m. EDT). Investors interested
in participating in the live call can dial (800) 279-9534 from the
U.S. International callers can dial (719) 457-2080. A
telephone replay will be available approximately two hours after
the call concludes and will be available through Thursday,
September 14, 2017, by dialing (844) 512-2921 from the U.S. and
entering confirmation code 2297405, or (412) 317-6671 from
international locations, and entering confirmation code
2297405.
There will also be a simultaneous, live webcast
available on the Investor Relations section of the Company's web
site at http://investor.lifevantage.com/events.cfm. The webcast
will be archived for approximately 30 days.
About LifeVantage
Corporation
LifeVantage Corporation is a science-based
health, wellness and anti-aging company dedicated to helping people
transform themselves internally and externally at a cellular level.
Their scientifically-validated product lines include Protandim®
Nrf2 and NRF1 Synergizers, TrueScience® Anti-Aging Skin Care
Regimen, Petandim® for Dogs, AXIO® Smart Energy and the PhysIQ™
Smart Weight Management System. LifeVantage was founded in 2003 and
is headquartered in Salt Lake City, Utah. For more information,
visit www.lifevantage.com.
Forward Looking Statements
This document contains forward-looking statements made pursuant
to the safe harbor provisions of the Private Securities Litigation
Reform Act of 1995. Words and expressions reflecting optimism,
satisfaction or disappointment with current prospects, as well as
words such as "believe," "hopes," "intends," "estimates,"
"expects," "projects," "plans," "anticipates," "look forward to"
and variations thereof, identify forward-looking statements, but
their absence does not mean that a statement is not
forward-looking. Examples of forward-looking statements include,
but are not limited to, statements we make regarding our future
operating results, implementation of our strategic initiatives, ,
distributor success and shareholder value. Such forward-looking
statements are not guarantees of performance and the Company's
actual results could differ materially from those contained in such
statements. These forward-looking statements are based on the
Company's current expectations and beliefs concerning future events
affecting the Company and involve known and unknown risks and
uncertainties that may cause the Company's actual results or
outcomes to be materially different from those anticipated and
discussed herein. These risks and uncertainties include, among
others, those discussed in greater detail in the Company's Annual
Report on Form 10-K and the Company's Quarterly Report on Form 10-Q
under the caption "Risk Factors," and in other documents filed by
the Company from time to time with the Securities and Exchange
Commission. The Company cautions investors not to place undue
reliance on the forward-looking statements contained in this
document. All forward-looking statements are based on information
currently available to the Company on the date hereof, and the
Company undertakes no obligation to revise or update these
forward-looking statements to reflect events or circumstances after
the date of this document, except as required by law.
About Non-GAAP Financial
Measures
We define Non-GAAP EBITDA as earnings before
interest expense, income taxes, depreciation and amortization and
Non-GAAP Adjusted EBITDA as earnings before interest expense,
income taxes, depreciation and amortization, stock compensation
expense, other income, net, and certain other adjustments. Non-GAAP
EBITDA and Non-GAAP Adjusted EBITDA may not be comparable to
similarly titled measures reported by other companies. We
define Non-GAAP Net Income and Non-GAAP Earnings per Share as GAAP
net income less certain tax adjusted non-recurring one-time
expenses incurred during the period.
We are presenting Non-GAAP EBITDA, Non-GAAP
Adjusted EBITDA, Non-GAAP Net Income and Non-GAAP Earnings Per
Share because management believes that they provide additional ways
to view our operations when considered with both our GAAP results
and the reconciliation to net income, which we believe provides a
more complete understanding of our business than could be obtained
absent this disclosure. Non-GAAP EBITDA, Non-GAAP Adjusted EBITDA,
Non-GAAP Net Income and Non-GAAP Earnings Per Share are presented
solely as supplemental disclosure because: (i) we believe these
measures are a useful tool for investors to assess the operating
performance of the business without the effect of these items; (ii)
we believe that investors will find this data useful in assessing
shareholder value; and (iii) we use Non-GAAP EBITDA, Non-GAAP
Adjusted EBITDA, Non-GAAP Net Income and Non-GAAP Earnings Per
Share internally as benchmarks to evaluate our operating
performance or compare our performance to that of our competitors.
The use of Non-GAAP EBITDA, Non-GAAP Adjusted EBITDA, Non-GAAP Net
Income and Non-GAAP Earnings per Share has limitations and you
should not consider these measures in isolation from or as an
alternative to the relevant GAAP measure of net income prepared in
accordance with GAAP, or as a measure of profitability or
liquidity.
The tables set forth below present Non-GAAP
EBITDA, Non-GAAP Adjusted EBITDA, Non-GAAP Net Income and Non-GAAP
Earnings per Share which are non-GAAP financial measures to Net
Income and Earnings per Share, our most directly comparable
financial measures presented in accordance with GAAP.
|
LIFEVANTAGE CORPORATION AND
SUBSIDIARIES |
CONSOLIDATED BALANCE SHEETS |
(unaudited) |
|
|
|
As of |
|
|
|
June 30, 2017 |
|
|
June 30, 2016 |
(In thousands, except
per share data) |
|
|
|
|
|
(As Revised) |
ASSETS |
|
|
|
|
|
|
Current assets |
|
|
|
|
|
|
Cash and
cash equivalents |
|
|
$ |
11,458 |
|
|
|
$ |
7,883 |
|
Accounts
receivable |
|
|
1,334 |
|
|
|
1,552 |
|
Income
tax receivable |
|
|
913 |
|
|
|
— |
|
Inventory, net |
|
|
16,575 |
|
|
|
25,116 |
|
Current
deferred income tax asset |
|
|
— |
|
|
|
2,260 |
|
Prepaid
expenses and deposits |
|
|
5,266 |
|
|
|
6,301 |
|
Total
current assets |
|
|
35,546 |
|
|
|
43,112 |
|
|
|
|
|
|
|
|
Property
and equipment, net |
|
|
3,127 |
|
|
|
3,456 |
|
Intangible assets, net |
|
|
1,247 |
|
|
|
1,744 |
|
Long-term
deferred income tax asset |
|
|
4,087 |
|
|
|
1,023 |
|
Other
long-term assets |
|
|
1,242 |
|
|
|
1,520 |
|
TOTAL ASSETS |
|
|
$ |
45,249 |
|
|
|
$ |
50,855 |
|
|
|
|
|
|
|
|
LIABILITIES AND
STOCKHOLDERS' EQUITY |
|
|
|
|
|
|
Current
liabilities |
|
|
|
|
|
|
Accounts
payable |
|
|
$ |
4,850 |
|
|
|
$ |
8,891 |
|
Commissions payable |
|
|
6,837 |
|
|
|
7,719 |
|
Income
tax payable |
|
|
215 |
|
|
|
3,284 |
|
Other
accrued expenses |
|
|
9,453 |
|
|
|
8,734 |
|
Current
portion of long-term debt |
|
|
2,000 |
|
|
|
2,000 |
|
Total
current liabilities |
|
|
23,355 |
|
|
|
30,628 |
|
|
|
|
|
|
|
|
Long-term debt |
|
|
|
|
|
|
Principal
amount |
|
|
5,500 |
|
|
|
7,500 |
|
Less: unamortized discount and deferred offering costs |
|
|
(60 |
) |
|
|
(91 |
) |
Long-term
debt, net of unamortized discount and deferred offering costs |
|
|
5,440 |
|
|
|
7,409 |
|
Other
long-term liabilities |
|
|
1,927 |
|
|
|
2,169 |
|
Total
liabilities |
|
|
30,722 |
|
|
|
40,206 |
|
Commitments and
contingencies |
|
|
|
|
|
|
Stockholders'
equity |
|
|
|
|
|
|
Preferred
stock — par value $0.001, 50,000 shares authorized, no shares
issued or outstanding |
|
|
— |
|
|
|
— |
|
Common
stock — par value $0.001, 250,000 shares authorized and 14,232 and
14,028 issued and outstanding as of June 30, 2017 and 2016,
respectively |
|
|
|
14 |
|
|
|
|
14 |
|
Additional paid-in capital |
|
|
121,599 |
|
|
|
119,242 |
|
Accumulated deficit |
|
|
(106,992 |
) |
|
|
(108,600 |
) |
Accumulated other comprehensive income (loss) |
|
|
(94 |
) |
|
|
(7 |
) |
Total
stockholders’ equity |
|
|
14,527 |
|
|
|
10,649 |
|
TOTAL LIABILITIES AND
STOCKHOLDERS’ EQUITY |
|
|
$ |
45,249 |
|
|
|
$ |
50,855 |
|
|
LIFEVANTAGE CORPORATION AND
SUBSIDIARIES |
CONSOLIDATED STATEMENTS OF OPERATIONS AND
COMPREHENSIVE INCOME |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the Three Months EndedJune 30,(Unaudited) |
|
|
For the Twelve Months EndedJune 30, |
|
|
2017 |
|
|
2016 |
|
|
2017 |
|
|
2016 |
(In thousands, except
per share data) |
|
|
|
|
(As revised) |
|
|
|
|
|
(As revised) |
Revenue, net |
|
$ |
50,641 |
|
|
|
$ |
53,033 |
|
|
|
$ |
199,489 |
|
|
|
$ |
206,540 |
|
Cost of sales |
|
8,891 |
|
|
|
9,401 |
|
|
|
33,456 |
|
|
|
33,932 |
|
Gross
profit |
|
41,750 |
|
|
|
43,632 |
|
|
|
166,033 |
|
|
|
172,608 |
|
Operating
expenses: |
|
|
|
|
|
|
|
|
|
|
|
Commissions and incentives |
|
23,984 |
|
|
|
25,595 |
|
|
|
96,662 |
|
|
|
103,120 |
|
Selling,
general and administrative |
|
16,226 |
|
|
|
13,957 |
|
|
|
64,922 |
|
|
|
56,074 |
|
Total
operating expenses |
|
40,210 |
|
|
|
39,552 |
|
|
|
161,584 |
|
|
|
159,194 |
|
Operating income |
|
1,540 |
|
|
|
4,080 |
|
|
|
4,449 |
|
|
|
13,414 |
|
Other expense: |
|
|
|
|
|
|
|
|
|
|
|
Interest
expense |
|
(164 |
) |
|
|
(145 |
) |
|
|
(570 |
) |
|
|
(3,321 |
) |
Other
expense, net |
|
(616 |
) |
|
|
(1,153 |
) |
|
|
(969 |
) |
|
|
(1,409 |
) |
Total
other expense |
|
(780 |
) |
|
|
(1,298 |
) |
|
|
(1,539 |
) |
|
|
(4,730 |
) |
Income before income
taxes |
|
760 |
|
|
|
2,782 |
|
|
|
2,910 |
|
|
|
8,684 |
|
Income
tax expense |
|
(676 |
) |
|
|
(345 |
) |
|
|
(1,302 |
) |
|
|
(2,578 |
) |
Net income |
|
$ |
84 |
|
|
|
$ |
2,437 |
|
|
|
$ |
1,608 |
|
|
|
$ |
6,106 |
|
Net income per
share: |
|
|
|
|
|
|
|
|
|
|
|
Basic |
|
$ |
0.01 |
|
|
|
$ |
0.18 |
|
|
|
$ |
0.12 |
|
|
|
$ |
0.44 |
|
Diluted |
|
$ |
0.01 |
|
|
|
$ |
0.17 |
|
|
|
$ |
0.11 |
|
|
|
$ |
0.42 |
|
Weighted-average shares
outstanding: |
|
|
|
|
|
|
|
|
|
|
|
Basic |
|
13,952 |
|
|
|
13,758 |
|
|
|
13,881 |
|
|
|
13,730 |
|
Diluted |
|
14,085 |
|
|
|
14,640 |
|
|
|
14,118 |
|
|
|
14,531 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Other comprehensive
income (loss), net of tax: |
|
|
|
|
|
|
|
|
|
|
|
Foreign
currency translation adjustment |
|
(15 |
) |
|
|
116 |
|
|
|
(87 |
) |
|
|
244 |
|
Other comprehensive
income (loss), net of tax: |
|
(15 |
) |
|
|
116 |
|
|
|
(87 |
) |
|
|
244 |
|
Comprehensive
income |
|
$ |
69 |
|
|
|
$ |
2,553 |
|
|
|
$ |
1,521 |
|
|
|
$ |
6,350 |
|
LIFEVANTAGE CORPORATION AND
SUBSIDIARIES |
Revenue by Region |
|
|
|
For the Three Months Ended
June 30,(unaudited) |
|
|
For the Twelve Months Ended June
30, |
|
|
2017 |
|
|
2016 |
|
|
2017 |
|
|
2016 |
(In thousands) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Americas |
|
$ |
38,714 |
|
|
76 |
% |
|
|
$ |
39,498 |
|
|
74 |
% |
|
|
$ |
150,841 |
|
|
76 |
% |
|
|
$ |
158,291 |
|
|
77 |
% |
Asia/Pacific &
Europe |
|
11,927 |
|
|
24 |
% |
|
|
13,535 |
|
|
26 |
% |
|
|
48,648 |
|
|
24 |
% |
|
|
48,249 |
|
|
23 |
% |
Total |
|
$ |
50,641 |
|
|
100 |
% |
|
|
$ |
53,033 |
|
|
100 |
% |
|
|
$ |
199,489 |
|
|
100 |
% |
|
|
$ |
206,540 |
|
|
100 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Active Independent Distributors
(1) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(unaudited) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
June 30, |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2017 |
|
|
2016 |
|
|
|
|
|
|
|
|
|
|
|
|
Americas |
|
47,000 |
|
|
73 |
% |
|
|
49,000 |
|
|
71 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
Asia/Pacific &
Europe |
|
17,000 |
|
|
27 |
% |
|
|
20,000 |
|
|
29 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
Total |
|
64,000 |
|
|
100 |
% |
|
|
69,000 |
|
|
100 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Active Preferred Customers (2) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(unaudited) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
June 30, |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2017 |
|
|
2016 |
|
|
|
|
|
|
|
|
|
|
|
|
Americas |
|
90,000 |
|
|
80 |
% |
|
|
95,000 |
|
|
81 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
Asia/Pacific &
Europe |
|
22,000 |
|
|
20 |
% |
|
|
22,000 |
|
|
19 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
Total |
|
112,000 |
|
|
100 |
% |
|
|
117,000 |
|
|
100 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
(1) Active Independent Distributors have purchased product
in the prior three months for retail or personal
consumption.(2) Active Preferred Customers have purchased
product in the prior three months for personal consumption
only.
|
LIFEVANTAGE CORPORATION AND
SUBSIDIARIES |
Reconciliation of GAAP Net Income to Non-GAAP
EBITDA and Non-GAAP Adjusted EBITDA: |
(Unaudited) |
|
|
|
|
|
|
|
|
|
|
For the Three Months EndedJune
30, |
|
|
For the Twelve Months EndedJune
30, |
|
|
|
2017 |
|
|
2016 |
|
|
2017 |
|
|
2016 |
(In thousands) |
|
|
|
|
|
(As Revised) |
|
|
|
|
|
(As Revised) |
GAAP Net income |
|
|
$ |
84 |
|
|
|
$ |
2,437 |
|
|
|
$ |
1,608 |
|
|
|
$ |
6,106 |
|
Interest expense |
|
|
164 |
|
|
|
145 |
|
|
|
570 |
|
|
|
3,321 |
|
Provision for income
taxes |
|
|
676 |
|
|
|
345 |
|
|
|
1,302 |
|
|
|
2,578 |
|
Depreciation and
amortization |
|
|
418 |
|
|
|
471 |
|
|
|
1,643 |
|
|
|
1,895 |
|
Non-GAAP EBITDA: |
|
|
1,342 |
|
|
|
3,398 |
|
|
|
5,123 |
|
|
|
13,900 |
|
Adjustments: |
|
|
|
|
|
|
|
|
|
|
|
|
Stock compensation
expense |
|
|
855 |
|
|
|
1,045 |
|
|
|
2,647 |
|
|
|
2,621 |
|
Other income, net |
|
|
616 |
|
|
|
1,153 |
|
|
|
969 |
|
|
|
1,409 |
|
Other
adjustments(1) |
|
|
446 |
|
|
|
(7 |
) |
|
|
4,348 |
|
|
|
1,720 |
|
Total adjustments |
|
|
1,917 |
|
|
|
2,191 |
|
|
|
7,964 |
|
|
|
5,750 |
|
Non-GAAP Adjusted
EBITDA |
|
|
$ |
3,259 |
|
|
|
$ |
5,589 |
|
|
|
$ |
13,087 |
|
|
|
$ |
19,650 |
|
(1) Other adjustments for the three months ended June 30, 2017
include approximately $0.2 million for executive search firm
expenses, $0.2 million for other nonrecurring legal expenses and
$0.1 for expenses associated with ongoing class-action lawsuits.
Other adjustments for the three months ended June 30, 2016 include
approximately ($7,000) for net severance, search firm and hiring
expenses. Other adjustments for the twelve months ended June 30,
2017 include approximately $2.7 million for expenses associated
with the audit committee independent review, $1.3 million for
executive severance and search firm expenses, $0.2 million for
other nonrecurring legal expenses and $0.2 million associated with
the ongoing class-action lawsuits. Other adjustments for the twelve
months ended June 30, 2016 include approximately $0.7 million for
executive severance expenses, $0.9 million for search firm and
hiring expenses associated with the search for executive officers,
and $0.1 million for expenses associated with the reverse stock
split completed during October 2015.
|
LIFEVANTAGE CORPORATION AND
SUBSIDIARIES |
Reconciliation of GAAP Net Income to Non-GAAP
Net Income and Non-GAAP Adjusted EPS: |
(Unaudited) |
|
|
|
|
|
|
|
|
For the Three Months EndedJune
30, |
|
|
For the Twelve Months EndedJune
30, |
|
|
2017 |
|
|
2016 |
|
|
2017 |
|
|
2016(1) |
(In thousands) |
|
|
|
|
(As Revised) |
|
|
|
|
|
(As Revised) |
GAAP Net income |
|
$ |
84 |
|
|
|
$ |
2,437 |
|
|
|
$ |
1,608 |
|
|
|
$ |
6,106 |
|
Adjustments: |
|
|
|
|
|
|
|
|
|
|
|
Executive
team severance expenses, net (2) |
|
— |
|
|
|
(45 |
) |
|
|
39 |
|
|
|
632 |
|
Executive
team recruiting and transition expenses |
|
203 |
|
|
|
38 |
|
|
|
744 |
|
|
|
928 |
|
Reverse
stock split administrative expenses |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
159 |
|
Write-off
of deferred debt transaction costs |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
1,544 |
|
Write-off
of capitalized software development costs |
|
— |
|
|
|
1,186 |
|
|
|
— |
|
|
|
1,186 |
|
Audit
committee independent review expenses |
|
— |
|
|
|
— |
|
|
|
2,742 |
|
|
|
— |
|
Class-action lawsuit expenses |
|
84 |
|
|
|
— |
|
|
|
170 |
|
|
|
— |
|
Other
nonrecurring legal expenses |
|
160 |
|
|
|
— |
|
|
|
160 |
|
|
|
— |
|
Write-off
of intangible assets |
|
350 |
|
|
|
— |
|
|
|
350 |
|
|
|
— |
|
Tax
impact of adjustments |
|
(356 |
) |
|
|
(350 |
) |
|
|
(1,881 |
) |
|
|
(1,320 |
) |
Total adjustments, net
of tax |
|
441 |
|
|
|
829 |
|
|
|
2,324 |
|
|
|
3,129 |
|
Non-GAAP Net
Income: |
|
$ |
525 |
|
|
|
$ |
3,266 |
|
|
|
$ |
3,932 |
|
|
|
$ |
9,235 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the Three Months EndedJune
30, |
|
|
For the Twelve Months EndedJune
30, |
|
|
2017 |
|
|
2016 |
|
|
2017 |
|
|
2016(1) |
|
|
|
|
|
(As Revised) |
|
|
|
|
|
(As Revised) |
Diluted earnings per
share, as reported |
|
$ |
0.01 |
|
|
|
$ |
0.17 |
|
|
|
$ |
0.11 |
|
|
|
$ |
0.42 |
|
Total
adjustments, net of tax |
|
0.03 |
|
|
|
0.06 |
|
|
|
0.16 |
|
|
|
0.22 |
|
Diluted earnings per
share, as adjusted |
|
$ |
0.04 |
|
|
|
$ |
0.23 |
|
|
|
$ |
0.27 |
|
|
|
$ |
0.64 |
|
(1) Executive team severance expenses for the prior period
non-GAAP adjustments have been restated from previously reported
results to display these expenses net of unvested stock award
reversals for comparability purposes.
(2) Net of $493,000 of compensation expense benefit related to
unvested stock award reversals for the twelve months ended June 30,
2017. Net of $191,000 of compensation expense benefit related
to unvested stock award reversals for the twelve months ended June
30, 2016.
Investor Relations Contacts:
Cindy England
Director of Investor Relations
(801) 432-9036
cengland@lifevantage.com
-or-
Scott Van Winkle
Managing Director, ICR
(617) 956-6736
scott.vanwinkle@icrinc.com
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