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Nature’s Sunshine Products Reports Third Quarter 2019 Financial Results With Continued Margin Improvement

globe newswire
Nature’s Sunshine Products Reports Third Quarter 2019 Financial Results With Continued Margin Improvement

Nature’s Sunshine Products Reports Third Quarter 2019 Financial Results With Continued Margin Improvement

|GlobeNewswire|About: NATR

Third Quarter 2019 Highlights

  • Net sales of $88.5 million were relatively consistent with the prior year and increased 1.1 percent on a local currency basis.

  • GAAP net income was $1.4 million compared to $1.3 million in the prior year

  • GAAP net income per diluted share was $0.07 compared to $0.08 per share in the prior year

  • Adjusted net income per diluted share increased 60.0 percent to $0.08 compared to $0.05 per share in the prior year

  • Adjusted EBITDA increased 63.2 percent to $8.3 million from $5.1 million in the prior year

LEHI, Utah, Nov. 07, 2019 (GLOBE NEWSWIRE) -- Nature’s Sunshine Products, Inc. (NASDAQ: NATR), a leading natural health and wellness company engaged in the manufacture and sale of nutritional and personal care products, today reported its financial results for the third quarter ended September 30, 2019.

Management Commentary

“We continue to make excellent progress implementing our global strategy, which focuses on strengthening our brand, improving field fundamentals, expanding digital capabilities, extending our manufacturing leadership, and improving organizational capabilities. We have strategically restructured the business to both align our resources to our global strategy and improve profitability, which drove strong growth of adjusted net income and adjusted EBITDA during the third quarter,” stated Terrence Moorehead, President and Chief Executive Officer. “We have successfully launched our new global management structure, driving improved organizational effectiveness and execution. We have also worked diligently to build our next generation capabilities as we prepare for a brand relaunch, the launch of a new digital platform and our entry into the rapidly growing hemp-derived CBD market. Each of our strategic efforts are focused on accelerating growth, driving profitability and enhancing shareholder value.”

Third Quarter 2019 Financial Summary

 

Net Sales by Operating Segment (Amounts in Thousands)

 

Three Months
Ended
September 30,
2019

 

Three Months
Ended
September 30,
2018

 

Percent
Change

 

Impact of
Currency
Exchange

 

Percent
Change
Excluding
Impact of
Currency

Asia

$

33,717

 

$

34,063

 

(1.0

)

%

 

$

(947

)

 

1.8

 

%

Europe

14,640

 

13,076

 

12.0

 

 

 

(229

)

 

13.7

 

 

North America

34,161

 

35,578

 

(4.0

)

 

 

(25

)

 

(3.9

)

 

Latin America and Other

6,006

 

6,111

 

(1.7

)

 

 

(116

)

 

0.2

 

 

 

$

88,524

 

$

88,828

 

(0.3

)

%

 

$

(1,317

)

 

1.1

 

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net sales of $88.5 million decreased 0.3 percent compared to $88.8 million in the third quarter of 2018. Net sales were also negatively impacted by $1.3 million of unfavorable foreign currency exchange rate fluctuations. On a local currency basis, net sales increased 1.1 percent compared to 2018. The increase in local currency net sales was primarily related to growth in Asia and Europe, partially offset by declines in North America, and Latin America and Other.

Gross margin, as a percentage of net sales, increased to 74.3 percent from 73.9 percent in the third quarter of 2018. The increase in gross margin as compared to the prior year was primarily driven by changes in market mix and reserves for obsolete inventory recorded in the prior year.

Volume incentives, as a percentage of net sales, decreased to 33.7 percent from 34.3 percent in the third quarter 2018.

Selling, general and administrative expenses ("SG&A") decreased by approximately $0.5 million to $31.2 million for the third quarter of 2019. The decrease in SG&A expenses is primarily due to savings from restructuring activities. As a percentage of net sales, SG&A expenses decreased to 35.2 percent from 35.6 percent in the third quarter of 2018. Excluding the impact of restructuring and net gain on sale of property, SG&A expenses as a percentage of net sales were 34.8 percent and 36.8 percent for the third quarters of 2019 and 2018, respectively.

Operating income in the third quarter of 2019 was $4.7 million, or 5.3 percent of net sales, as compared to $3.5 million, or 4.0 percent of net sales in the third quarter of 2018. Excluding impact of non-recurring items noted above, operating income was $5.1 million, or 5.8 percent of net sales, compared to $2.5 million, or 2.8 percent of net sales in the prior year period.

Other loss, net, in the third quarter of 2019 was a loss of $1.2 million compared to a loss of $0.4 million in the third quarter of 2018. The provision for income taxes was $2.1 million in the third quarter of 2019 compared to $1.8 million in the third quarter of 2018. 

GAAP net income attributable to common shareholders was $1.3 million, or $0.07 per diluted common share, compared to $1.5 million, or $0.08 per diluted common share in the third quarter of 2018. Net income attributable to NSP China was $0.2 million or $0.01 per diluted common share for the quarter, compared to a loss of $0.8 million, or $0.04 per diluted common share for the third quarter of 2018.

Adjusted net income attributable to common shareholders was $1.6 million, or $0.08 per diluted common share, compared to $1.0 million, or $0.05 per diluted common share in the prior year period. A reconciliation of adjusted net income to GAAP net income is provided in the attached financial tables.

Adjusted EBITDA was $8.3 million, compared to $5.1 million in 2018. Adjusted EBITDA, which is a non-GAAP financial measure, is defined here as net income from continuing operations before taxes, depreciation, amortization and other income/loss adjusted to exclude share-based compensation expense and certain noted adjustments. A reconciliation of Net Income to Adjusted EBITDA is provided in the attached financial tables.

Nine Months Ended September 30, 2019 Financial Summary

 

Net Sales by Operating Segment (Amounts In Thousands)

 

Nine Months
Ended
September 30,
2019

 

Nine Months
Ended
September 30,
2018

 

Percent
Change

 

Impact of
Currency
Exchange

 

Percent
Change
Excluding
Impact of
Currency

Asia

$

102,475

 

$

97,593

 

5.0

 

%

 

$

(4,476

)

 

9.6

 

%

Europe

45,312

 

41,601

 

8.9

 

 

 

(1,184

)

 

11.8

 

 

North America

105,304

 

109,201

 

(3.6

)

 

 

(249

)

 

(3.3

)

 

Latin America and Other

17,429

 

19,041

 

(8.5

)

 

 

(335

)

 

(6.7

)

 

 

$

270,520

 

$

267,436

 

1.2

 

%

 

$

(6,244

)

 

3.5

 

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net sales of $270.5 million increased 1.2 percent compared to $267.4 million in the nine months ended September 30, 2018. Net sales were also negatively impacted by $6.2 million of unfavorable foreign currency exchange rate fluctuations. On a local currency basis, net sales increased 3.5 percent compared to 2018. The increase in local currency net sales was primarily related to growth in Asia and Europe partially offset by a $3.6 million decline in North America and a $1.3 million decline in Latin America and Other.

Gross margin, as a percentage of net sales, increased to 74.1 percent from 73.8 percent in the nine months ended September 30, 2018. The increase in gross margin as compared to the prior year was primarily driven by changes in market mix and reserves for obsolete inventory recorded in the prior year.

Volume incentives, as a percentage of net sales, decreased to 34.1 percent from 34.9 percent in the nine months ended September 30, 2018. The decrease in volume incentives as a percent of net sales is primarily due to changes in market mix, reflecting growth in markets where volume incentives as a percentage of net sales are lower than the consolidated average, and the growth in NSP China where payments to independent service providers are included in SG&A.

SG&A expenses decreased by approximately $1.3 million to $96.0 million for the nine months ended September 30, 2019. The decrease in SG&A expenses is primarily due to savings from restructuring activities. As a percentage of net sales, SG&A expenses decreased to 35.5 percent from 36.4 percent in the nine months ended September 30, 2018. Excluding the impact of restructuring and other non-recurring expenses as well as net gains on sales of properties, SG&A expenses as a percentage of net sales were 34.6 percent and 37.1 percent for the nine months ended September 30, 2019 and 2018, respectively.

Operating income in the nine months ended September 30, 2019 was $12.2 million, or 4.5 percent of net sales, as compared to $6.6 million, or 2.5 percent of net sales for the same period 2018. Excluding impact of non-recurring items noted above, operating income was $14.6 million, or 5.4 percent of net sales, compared to a $4.8 million, or 1.8 percent of net sales in the prior year period.

Other loss, net, in the nine months ended September 30, 2019 was a loss of $1.0 million compared to a loss of $1.4 million for the same period 2018. The provision for income taxes was $5.5 million in the nine months ended September 30, 2019 compared to $3.6 million for the same period 2018. 

GAAP net income attributable to common shareholders was $5.8 million, or $0.29 per diluted common share, compared to $2.1 million, or $0.11 per diluted common share in the nine months ended September 30, 2018. Net loss attributable to NSP China was $0.3 million or $0.01 per diluted common share for the nine months ended September 30, 2019, compared to a loss of $2.3 million, or $0.12 per diluted common share for the same period 2018.

Adjusted net income attributable to common shareholders was $7.3 million, or $0.37 per diluted common share, compared to $0.2 million, or $0.01 per diluted common share in the prior year period. A reconciliation of adjusted net income to GAAP net income is provided in the attached financial tables.

Adjusted EBITDA was $23.6 million, compared to $13.6 million in 2018. A reconciliation of Adjusted EBITDA to GAAP net income is provided in the attached financial tables.

Balance Sheet and Cash Flow

Net cash used in operating activities was $5.5 million for the nine months ended September 30, 2019, compared to $14.2 million provided in the prior year period. Capital expenditures during the nine months ended September 30, 2019 totaled $4.5 million compared to $4.0 million in the same period of 2018. As of September 30, 2019, the Company had cash and cash equivalents of $50.5 million.

Active Distributors and Customers by Segment (1)

 

2019

 

2018

 

Distributors
& Customers

 

Managers

 

Distributors
& Customers

 

Managers

Asia

35,700

 

2,600

 

33,900

 

2,400

Europe

88,200

 

4,300

 

75,700

 

3,700

North America

75,500

 

4,600

 

75,700

 

4,900

Latin America and Other

30,400

 

1,100

 

28,700

 

1,200

 

229,800

 

12,600

 

214,000

 

12,200

  1. Active Distributors and customers include Nature’s Sunshine Products’ independent Distributors and customers who have purchased our products directly for resale and/or personal consumption during the previous three months ended as of the date indicated. Total Managers, Distributors and Customers, which includes those who have made a purchase in the last twelve months, was 509,800 as of September 30, 2019.

In China, we sell our products through multiple channels, including cross-border e-commerce, wholesale, direct sellers and independent service providers who are compensated for marketing, sales support, and other services.

Conference Call

Nature’s Sunshine Products will host a conference call to discuss its third quarter 2019 results on Thursday, November 7, 2019 at 5:00 PM Eastern Time. The toll-free dial-in number for callers in the U.S. and Canada is 1-800-239-9838, conference ID: 7401949. International callers can dial 1-323-794-2551, conference ID: 7401949. A replay will be available from November 7, 2019 at 8:00 PM Eastern Time through Thursday, November 21, 2019 at 11:59 PM Eastern Time by dialing 1-844-512-2921 (U.S. and Canada) or 1-412-317-6671 (International), replay PIN: 7401949. The call will also be webcast live and will be available on the Investors section of Nature’s Sunshine Products’ website at www.naturessunshine.com for 90 days.

About Nature’s Sunshine Products

Nature’s Sunshine Products (NATR), a leading natural health and wellness company, markets and distributes nutritional and personal care products in more than 40 countries. Nature’s Sunshine manufactures most of its products through its own state-of-the-art facilities to ensure its products continue to set the standard for the highest quality, safety and efficacy on the market today. Additional information about the Company can be obtained at its website, www.naturessunshine.com.

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

This press release contains forward-looking statements regarding the Company’s future business expectations, which are subject to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements may include, but are not limited to, statements relating to the Company’s objectives, plans, strategies and financial results. All statements (other than statements of historical fact) that address activities, events or developments that the Company intends, expects, projects, believes or anticipates will or may occur in the future are forward-looking statements. These statements are often characterized by terminology such as “believe,” “hope,” “may,” “anticipate,” “should,” “intend,” “plan,” “will,” “expect,” “estimate,” “project,” “positioned,” “strategy” and similar expressions, and are based on assumptions and assessments made by management in light of their experience and their perception of historical trends, current conditions, expected future developments and other factors they believe to be appropriate. Forward-looking statements are not guarantees of future performance and are subject to risks and uncertainties, including the following:

  • laws and regulations regarding direct selling may prohibit or restrict our ability to sell our products in some markets or require us to make changes to our business model in some markets;

  • extensive government regulations to which the Company's products, business practices and manufacturing activities are subject;

  • legal challenges to the Company's direct selling program or to the classification of its independent distributors;

  • impact of anti-bribery laws, including the U.S. Foreign Corrupt Practices Act;

  • the Company’s ability to attract and retain independent distributors;

  • the loss of one or more key independent distributors who have a significant sales network;

  • the full implementation of the Company’s joint venture for operations in China with Fosun Industrial Co., Ltd.;

  • registration of products for sale in foreign markets, or difficulty or increased cost of importing products into foreign markets;

  • cybersecurity threats and exposure to data loss;

  • the storage, processing, and use of data, some of which contain personal information, are subject to complex and evolving privacy and data protection laws and regulations;

  • reliance on information technology infrastructure;

  • the effect of fluctuating foreign exchange rates;

  • liabilities and obligations arising from improper activity by the Company’s independent distributors;

  • failure of the Company’s independent distributors to comply with advertising laws;

  • changes to the Company’s independent distributor compensation plans;

  • geopolitical issues and conflicts;

  • negative consequences resulting from difficult economic conditions, including the availability of liquidity or the willingness of the Company’s customers to purchase products;

  • risks associated with the manufacturing of the Company's products;

  • uncertainties relating to the application of transfer pricing, duties, value-added taxes, and other tax regulations, and changes thereto;

  • changes in tax laws, treaties or regulations, or their interpretation;

  • actions on trade relations by the U.S. and foreign governments;

  • product liability claims; and

  • the sufficiency of trademarks and other intellectual property rights.

These and other risks and uncertainties that could cause actual results to differ from predicted results are more fully detailed under the caption “Risk Factors” in our reports filed with the Securities and Exchange Commission, including our Annual Report on Form 10-K and Quarterly Reports filed on Form 10-Q.

All forward-looking statements speak only as of the date of this press release and are expressly qualified in their entirety by the cautionary statements included in or incorporated by reference into this press release. Except as is required by law, the Company expressly disclaims any obligation to publicly release any revisions to forward-looking statements to reflect events after the date of this press release.

Non-GAAP Financial Measures

We have included information which has not been prepared in accordance with generally accepted accounting principles (GAAP), such as information concerning non-GAAP net income, Adjusted EBITDA and net sales excluding the impact of foreign currency exchange fluctuations.

We utilize the non-GAAP measures of non-GAAP net income and Adjusted EBITDA in the evaluation of our operations and believe that these measures are useful indicators of our ability to fund our business. These non-GAAP financial measures should not be considered as an alternative to, or more meaningful than, U.S. GAAP net income (loss) as an indicator of our operating performance.

Other companies may use the same or similarly named measures, but exclude different items, which may not provide investors with a comparable view of Nature’s Sunshine Products’ performance in relation to other companies. We have included a reconciliation of Net Income to Adjusted EBITDA, the most comparable GAAP measure. We have also included a reconciliation of GAAP net income to Non-GAAP net income and Non-GAAP Adjusted EPS, in the attached financial tables.

Net sales in local currency removes, from net sales in U.S. dollars, the impact of changes in exchange rates between the U.S. dollar and the functional currencies of our foreign subsidiaries. This is accomplished by translating the current period net sales into U.S. dollars using the same foreign currency exchange rates that were used to translate the net sales for the previous comparable period.

We believe presenting the impact of foreign currency fluctuations is useful to investors because it allows a more meaningful comparison of net sales of our foreign operations from period to period. Net sales excluding the impact of foreign currency fluctuations should not be considered in isolation or as an alternative to net sales in U.S. dollar measures that reflect current period exchange rates, or to other financial measures calculated and presented in accordance with U.S. GAAP.

 

NATURE’S SUNSHINE PRODUCTS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(Amounts in thousands, except per share information)
(Unaudited)

 

Three Months Ended
September 30,

 

Nine Months Ended
September 30,

 

2019

 

 

2018

 

 

2019

 

 

2018

 

Net sales

$

88,524

 

 

$

88,828

 

 

$

270,520

 

 

$

267,436

 

Cost of sales

22,784

 

 

23,161

 

 

70,078

 

 

70,152

 

Gross profit

65,740

 

 

65,667

 

 

200,442

 

 

197,284

 

 

 

 

 

 

 

 

 

Operating expenses:

 

 

 

 

 

 

 

Volume incentives

29,862

 

 

30,511

 

 

92,177

 

 

93,365

 

Selling, general and administrative

31,177

 

 

31,643

 

 

96,048

 

 

97,339

 

Operating income

4,701

 

 

3,513

 

 

12,217

 

 

6,580

 

Other loss, net

(1,243

)

 

(353

)

 

(985

)

 

(1,420

)

Income before provision for income taxes

3,458

 

 

3,160

 

 

11,232

 

 

5,160

 

Provision for income taxes

2,107

 

 

1,821

 

 

5,523

 

 

3,550

 

Net income

1,351

 

 

1,339

 

 

5,709

 

 

1,610

 

Net income (loss) attributable to noncontrolling interests

34

 

 

(158

)

 

(54

)

 

(452

)

Net income attributable to common shareholders

$

1,317

 

 

$

1,497

 

 

$

5,763

 

 

$

2,062

 

 

 

 

 

 

 

 

 

Basic and diluted net income per common share:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic earnings per share attributable to common shareholders

$

0.07

 

 

$

0.08

 

 

$

0.30

 

 

$

0.11

 

 

 

 

 

 

 

 

 

Diluted earnings per share attributable to common shareholders

$

0.07

 

 

$

0.08

 

 

$

0.29

 

 

$

0.11

 

 

 

 

 

 

 

 

 

Weighted average basic common shares outstanding

19,313

 

 

19,164

 

 

19,291

 

 

19,094

 

Weighted average diluted common shares outstanding

19,662

 

 

19,382

 

 

19,618

 

 

19,406

 

 

 

 

 

 

 

 

 

 

 

 

 

 

NATURE’S SUNSHINE PRODUCTS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(Amounts in thousands)
(Unaudited)

 

September 30,
2019

 

December 31,
2018

Assets

 

 

 

Current assets:

 

 

 

Cash and cash equivalents

$

50,530

 

 

$

50,638

 

Accounts receivable, net of allowance for doubtful accounts of $405 and $460, respectively

7,488

 

 

7,751

 

Inventories

45,282

 

 

42,048

 

Prepaid expenses and other

5,224

 

 

6,388

 

Total current assets

108,524

 

 

106,825

 

 

 

 

 

Property, plant and equipment, net

61,052

 

 

64,061

 

Operating lease right-of-use assets

24,890

 

 

 

Investment securities - trading

1,166

 

 

1,308

 

Intangible assets, net

546

 

 

618

 

Deferred income tax assets

8,533

 

 

9,056

 

Other assets

10,036

 

 

11,148

 

Total assets

$

214,747

 

 

$

193,016

 

 

 

 

 

Liabilities and Shareholders’ Equity

 

 

 

Current liabilities:

 

 

 

Accounts payable

$

4,061

 

 

$

5,219

 

Accrued volume incentives and service fees

19,161

 

 

20,562

 

Accrued liabilities

28,787

 

 

34,801

 

Deferred revenue

1,324

 

 

1,197

 

Related party note payable

1,500

 

 

1,530

 

Income taxes payable

2,516

 

 

3,378

 

Current portion of operating lease liabilities

5,050

 

 

 

Total current liabilities

62,399

 

 

66,687

 

 

 

 

 

Liability related to unrecognized tax benefits

1,463

 

 

2,192

 

Long-term portion of operating lease liabilities

21,061

 

 

 

Deferred compensation payable

1,166

 

 

1,308

 

Long-term deferred income tax liabilities

1,498

 

 

1,556

 

Other liabilities

394

 

 

705

 

Total liabilities

87,981

 

 

72,448

 

 

 

 

 

Shareholders’ equity:

 

 

 

Common stock, no par value, 50,000 shares authorized, 19,331 and 19,204 shares issued and outstanding, respectively

135,080

 

 

133,684

 

Retained earnings (accumulated deficit)

3,691

 

 

(2,072

)

Noncontrolling interest

9

 

 

63

 

Accumulated other comprehensive loss

(12,014

)

 

(11,107

)

Total shareholders’ equity

126,766

 

 

120,568

 

Total liabilities and shareholders’ equity

$

214,747

 

 

$

193,016

 

 

 

 

 

 

 

 

 

 

NATURE’S SUNSHINE PRODUCTS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Amounts in thousands)
(Unaudited)

 

Nine Months Ended
September 30,

 

2019

 

 

2018

 

CASH FLOWS FROM OPERATING ACTIVITIES:

 

 

 

Net income

$

5,709

 

 

$

1,610

 

Adjustments to reconcile net income to net cash provided by operating activities:

 

 

 

Provision for doubtful accounts

4

 

 

155

 

Depreciation and amortization

7,533

 

 

7,313

 

Non-cash lease expense

3,989

 

 

 

Share-based compensation expense

1,529

 

 

1,458

 

Loss (gain) on sale of property, plant and equipment

17

 

 

(4,000

)

Deferred income taxes

474

 

 

650

 

Purchase of trading investment securities

(69

)

 

(128

)

Proceeds from sale of trading investment securities

392

 

 

610

 

Realized and unrealized gains on investments

(181

)

 

(80

)

Foreign exchange losses

597

 

 

1,250

 

Loss on write-off of cumulative translation adjustment

595

 

 

 

Changes in assets and liabilities:

 

 

 

Accounts receivable

152

 

 

467

 

Inventories

(4,074

)

 

462

 

Prepaid expenses and other current assets

1,065

 

 

(420

)

Other assets

469

 

 

897

 

Accounts payable

(1,073

)

 

88

 

Accrued volume incentives and service fees

(1,096

)

 

169

 

Accrued liabilities

(5,277

)

 

7,949

 

Deferred revenue

127

 

 

(1,334

)

Lease liabilities

(3,619

)

 

 

Income taxes payable

(880

)

 

(32

)

Liability related to unrecognized tax benefits

(729

)

 

(2,501

)

Deferred compensation payable

(142

)

 

(378

)

Net cash provided by operating activities

5,512

 

 

14,205

 

CASH FLOWS FROM INVESTING ACTIVITIES:

 

 

 

Purchases of property, plant and equipment

(4,474

)

 

(3,959

)

Proceeds from sale of property, plant and equipment

 

 

5,072

 

Net cash (used in) provided by investing activities

(4,474

)

 

1,113

 

CASH FLOWS FROM FINANCING ACTIVITIES:

 

 

 

Principal payments of revolving credit facility

(547

)

 

(56,853

)

Proceeds from revolving credit facility

547

 

 

45,508

 

Proceeds from related party borrowing

 

 

1,000

 

Proceeds from the exercise of stock awards

60

 

 

664

 

Tax benefit from stock awards

(193

)

 

(578

)

Net cash used in financing activities

(133

)

 

(10,259

)

Effect of exchange rates on cash and cash equivalents

(1,013

)

 

(110

)

Net (decrease) increase in cash and cash equivalents

(108

)

 

4,949

 

Cash and cash equivalents at the beginning of the period

50,638

 

 

42,910

 

Cash and cash equivalents at the end of the period

$

50,530

 

 

$

47,859

 

SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:

 

 

 

Cash paid for income taxes, net of refunds

$

5,212

 

 

$

3,700

 

Cash paid for interest

63

 

 

220

 

 

 

 

 

 

 

 

NATURE’S SUNSHINE PRODUCTS, INC. AND SUBSIDIARIES
RECONCILIATION OF NET INCOME TO ADJUSTED EBITDA
 (Amounts in thousands)
(Unaudited)

 

Three Months Ended
September 30,

 

Nine Months Ended
September 30,

 

2019

 

2018

 

 

2019

 

 

2018

 

Net income

$

1,351

 

$

1,339

 

 

$

5,709

 

 

$

1,610

 

Adjustments:

 

 

 

 

 

 

 

 

Depreciation and amortization 

2,546

 

2,301

 

 

7,533

 

 

7,313

 

Share-based compensation expense 

678

 

334

 

 

1,529

 

 

1,458

 

Other (income) loss, net* 

1,243

 

353

 

 

985

 

 

1,420

 

Provision for income taxes 

2,107

 

1,821

 

 

5,523

 

 

3,550

 

Other adjustments (1)

410

 

(1,042

)

 

2,364

 

 

(1,776

)

Adjusted EBITDA 

$

8,335

 

$

5,106

 

 

$

23,643

 

 

$

13,575

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(1) Other adjustments

 

 

 

 

 

 

 

 

CEO transition

$

 

$

 

 

$

 

 

$

1,518

 

Restructuring related expenses

410

 

686

 

 

2,364

 

 

686

 

Gain on sale of properties

 

(1,728

)

 

 

 

(3,980

)

Total adjustments

$

410

 

$

(1,042

)

 

$

2,364

 

 

$

(1,776

)

* Other (income) loss, net is primarily comprised of foreign exchange gains (losses), interest income, and interest expense.

NATURE’S SUNSHINE PRODUCTS, INC. AND SUBSIDIARIES
RECONCILIATION OF GAAP NET INCOME TO
NON-GAAP NET INCOME and NON-GAAP ADJUSTED EPS
 (Amounts in thousands)
(Unaudited)

 

Three Months Ended
September 30,

 

Nine Months Ended
September 30,

 

2019

 

 

2018

 

 

2019

 

 

2018

 

Net income

$

1,351

 

 

$

1,339

 

 

$

5,709

 

 

$

1,610

 

Adjustments:

 

 

 

 

 

 

 

CEO transition

 

 

 

 

 

 

1,518

 

Restructuring related expenses

410

 

 

686

 

 

2,364

 

 

686

 

Net gains on sales of properties

 

 

(1,728

)

 

 

 

(3,980

)

Tax impact of adjustments

(124

)

 

505

 

 

(867

)

 

(72

)

Total adjustments

286

 

 

(537

)

 

1,497

 

 

(1,848

)

Non-GAAP net income (loss)

$

1,637

 

 

$

802

 

 

$

7,206

 

 

$

(238

)

 

 

 

 

 

 

 

 

Reported income attributable to common shareholders

$

1,317

 

 

$

1,497

 

 

$

5,763

 

 

$

2,062

 

Total adjustments

286

 

 

(537

)

 

1,497

 

 

(1,848

)

Non-GAAP net income attributable to common shareholders

$

1,603

 

 

$

960

 

 

$

7,260

 

 

$

214

 

 

 

 

 

 

 

 

 

Basic income per share, as reported

$

0.07

 

 

$

0.08

 

 

$

0.30

 

 

$

0.11

 

Total adjustments, net of tax

0.01

 

 

(0.03

)

 

0.08

 

 

(0.10

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic income per share, as adjusted

$

0.08

 

 

$

0.05

 

 

$

0.38

 

 

$

0.01

 

 

 

 

 

 

 

 

 

Diluted income per share, as reported

$

0.07

 

 

$

0.08

 

 

$

0.29

 

 

$

0.11

 

Total adjustments, net of tax

0.01

 

 

(0.03

)

 

0.08

 

 

(0.10

)

Diluted income per share, as adjusted

$

0.08

 

 

$

0.05

 

 

$

0.37

 

 

$

0.01

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Contact:

Scott Van Winkle                              
Managing Director, ICR
(617) 956-6736
scott.vanwinkle@icrinc.com

https://ml.globenewswire.com/media/15a1a47d-84c4-42ec-a5e6-307d61bc58a4/small/nature-s-sunshine-logo.jpg

 

Source: Nature's Sunshine Products, Inc. (NATR) 2019 GlobeNewswire, Inc.

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