Nature's Sunshine Products Reports Third Quarter 2015 Financial Results

• Net sales revenue of $79.6 million was down 14.8% year-over-year; down 8.8% year-over-year on a local currency basis
• Earnings from continuing operations of $0.08 per diluted share
• Repurchased $6.1 million of common stock during first nine months of fiscal 2015
• Board of Directors approved a $0.10 per share quarterly cash dividend

LEHI, Utah, Nov. 3, 2015 (GLOBE NEWSWIRE) -- Nature's Sunshine Products, Inc. (NASDAQ:NATR), a leading natural health and wellness company engaged in the manufacture and direct selling of nutritional and personal care products, today reported its financial results for the third quarter ended September 30, 2015.

Third Quarter 2015 Financial Highlights

• Net sales revenue of $79.6 million, decreased 14.8% compared to $93.4 million in the third quarter of 2014. On a local currency basis, net sales revenue decreased 8.8% compared to the third quarter of 2014. Net sales revenue was negatively impacted by a $5.4 million decline in net sales in the NSP Russia, Central and Eastern Europe segment as well as a $5.6 million unfavorable impact in foreign currency exchange rate fluctuations.
   
• Net income from continuing operations was $1.6 million, or $0.08 per diluted common share, compared to $5.1 million, or $0.29 per diluted common share, in the third quarter of 2014. Earnings per diluted common share for the third quarter of 2015 were impacted by several factors including: the Company's investment in China of approximately $0.10 per share, which excludes tax benefits expected to be realized in future quarters, resulting in the higher-than-normal tax rate; foreign currency translation expenses of approximately $0.04 per share; and the net sales decline in the Russia, Central and Eastern Europe segment of approximately $0.03 per share.
   
• Adjusted EBITDA was $5.5 million compared to $7.7 million in the third quarter of 2014. 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 adjusted to exclude share-based compensation expense.

Management Commentary

"While our third quarter results were softer on the whole, we were very encouraged with NSP United States and NSP Canada both posting their fifth consecutive quarters of year-over-year local currency sales growth," commented Gregory L. Probert, Chairman and Chief Executive Officer. "This growth was primarily fueled by continued progress with our IN.FORM business model, key retail account management along with the successful adoption of new products launched at the Leaders Conference and Convention in April. As a result, we recognized a key milestone during the quarter with existing members and new member sign-ups in NSP U.S. both posting year-over-year growth for the first time in over two years."

Mr. Probert continued, "Our top-line, both as reported and in local currency, declined during the quarter primarily as a result of the ongoing challenges in NSP Russia, Central and Eastern Europe associated with political unrest in Ukraine and Russia and unfavorable currency headwinds. In an effort to strengthen our Distributor base in the region, we have launched various new product kits that have been very well received and are priced in a manner to support Distributor advancement as sales are made. Despite the uncertainty, we feel well-positioned to stimulate growth in the region with the support of our local partner once the situation steadies."

"Further suppressing growth during the quarter was performance at Synergy driven by continued softness in North America and Korea, and to a lesser extent in Europe, which was partially offset by improvements in Japan and Indonesia. To reignite growth in Synergy, we are intently focused on unifying our multiple product strategies across all regions with the goal of achieving a more cohesive sales method focused detox, weight management and a daily habit of health," added Mr. Probert.

Mr. Probert concluded, "Our entry into China is progressing on track and we remain hopeful we can secure our direct selling license in 2016. We made significant traction towards this goal with the grand opening of our new Shanghai office, which will serve as the Nature's Sunshine Products' headquarters in China, in addition to several key new hires to help support our successful launch in the region. On the product side, we designed new product packaging to achieve a premium look and feel as well as continued the process for general food importation and blue cap registration for select direct selling products. We are very excited to enter China and will update our progress on this front in the coming quarters."

Third Quarter 2015 Regional Sales by Operating Segment

Active Distributors and Customers by Segment ⁽¹⁾

(1)   Active Distributors and customers' includes our independent Distributors and customers who have purchased products directly from the Company for resale and/or personal consumption during the previous three months ended as of the date indicated.

Cash Flow and Balance Sheet Highlights

• Net cash provided by operating activities was $8.2 million for the nine months ended September 30, 2015 as compared to $13.5 million in the nine months ended September 30, 2014.
   
• Cash and cash equivalents as of September 30, 2015 were $43.9 million, compared to $58.7 million as of December 31, 2014.
   
• During the three months ended September 30, 2015, the Company repurchased $2.0 million of its common stock under its existing share repurchase plan. The Company's total repurchases in the first nine months of 2015 were 458,000 shares for a total of $6.1 million.
   
• The Company's Board of Directors approved a quarterly cash dividend of $0.10 per share, payable on November 30, 2015, to shareholders of record as of the close of business on November 18, 2015. Dividend payments during the quarter were $1.9 million. 

Conference Call

Nature's Sunshine Products will host a conference call to discuss its third quarter 2015 results on November 3, 2015 at 5:30 PM Eastern Time.  The toll-free dial-in number for callers in the U.S. and Canada is 1-877-407-0789, conference ID: 13621697.  International callers can dial 1-201-689-8562, conference ID: 13621697.  A replay will be available from November 3, 2015 at 8:30 PM Eastern Time through November 17, 2015 at 11:59 PM Eastern Time by dialing 1-877-870-5176 (U.S. and Canada) or 1-858-384-5517 (International), replay PIN: 13621697.  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 (NASDAQ:NATR), a leading natural health and wellness company, markets and distributes nutritional and personal care products through a global direct sales force of over 600,000 independent Managers, Distributors and customers 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. The Company has four reportable business segments that are divided based on the characteristics of their Distributor base, similarities in compensation plans, as well as the internal organization of NSP's officers and their responsibilities (NSP Americas; NSP Russia, Central and Eastern Europe; Synergy WorldWide; and China and New Markets). The Company also supports health and wellness for children around the world through its partnership with the Sunshine Heroes Foundation. Additional information about the Company can be obtained at its website, www.naturessunshine.com.

Cautionary Statement Regarding Forward-Looking Statements

Certain information included or incorporated herein by reference in this report may be deemed to be "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements may include, but are not limited to, statements relating to our objectives, plans and strategies. All statements (other than statements of historical fact) that address activities, events or developments that we intend, expect, project, believe or anticipate 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. For example, information appearing under "Management's Discussion and Analysis of Financial Condition and Results of Operations" includes forward-looking statements. Forward-looking statements are not guarantees of future performance and are subject to risks and uncertainties.

• any negative consequences resulting from the economy, including the availability of liquidity to us, our independent Distributors and our suppliers or the willingness of our customers to purchase products;
• our relationship with, and our inability to influence the actions of, our independent Distributors, and other third parties with whom we do business;
• improper activity by our employees or independent Distributors;
• negative publicity related to our products, ingredients, or direct selling organization or the nutritional supplement industry;
• changing consumer preferences and demands;
• our reliance upon, or the loss or departure of any member of, our senior management team which could negatively impact our Distributor relations and operating results;
• increased state and federal regulatory scrutiny of the nutritional supplement industry, including, but not limited to targeting of ingredients , testing methodology and product claims;
• the competitive nature of our business and the nutritional supplement industry;
• regulatory matters governing our products, ingredients, the nutritional supplement industry, our direct selling program, or the direct selling market in which we operate;
• legal challenges to our direct selling program or to the classification of our independent Distributors;
• risks associated with operating internationally and the effect of economic factors, including foreign exchange, inflation, disruptions or conflicts with our third party importers, governmental sanctions, ongoing Ukraine and Russia political conflict, pricing and currency devaluation risks, especially in countries such as Ukraine, Russia and Belarus;
• uncertainties relating to the application of transfer pricing, duties, value-added taxes, and other tax regulations, and changes thereto;
• our dependence on increased penetration of existing markets;
• our reliance on our information technology infrastructure;
• the sufficiency of trademarks and other intellectual property rights;
• changes in tax laws, treaties or regulations, or their interpretation;
• taxation relating to our independent Distributors;
• product liability claims;
• share price volatility related to, among other things, speculative trading; and
• the full implementation of our joint venture for operations in China with Fosun Industrial Co., Ltd., as well as the legal complexities, unique regulatory environment and challenges of doing business in China generally.

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, we expressly disclaim any obligation to publicly release any revisions to forward-looking statements to reflect events after the date of this press release. Throughout this press release, we refer to Nature's Sunshine Products, Inc., together with its subsidiaries, as "we," "us," "our Company" or "the Company."

Non-GAAP Financial Measures

The Company has included information which has not been prepared in accordance with generally accepted accounting principles (GAAP), such as information concerning Adjusted EBITDA because management utilizes this information in the evaluation of its operations and believes that these measures are a useful indicator of the Company's ability to fund its business. These non-GAAP financial measures should not be considered as an alternative to, or more meaningful than, U.S. GAAP net income as an indicator of the Company's operating performance. Moreover, these non-GAAP financial measures, as presented by the Company, may not be comparable to similarly titled measures reported by other companies. 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. The Company has included a reconciliation of these non-GAAP measures to reported earnings under GAAP in the attached financial tables.

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

CONTACT: Stephen M. Bunker
         Chief Financial Officer
         Nature's Sunshine Products, Inc.
         Lehi, Utah 84043
         (801) 341-7303
         investorrelations@natr.com

Released November 3, 2015