Exhibit 99.1
NATURE’S SUNSHINE PRODUCTS REPORTS
SECOND QUARTER OPERATING RESULTS
PROVO, Utah, July 29, 2003 – Nature’s Sunshine Products, Inc. (NASDAQ:NATR), a leading manufacturer and marketer of encapsulated herbs and vitamins, today reported operating results for the quarter and six months ended June 30, 2003.
Sales revenue for the quarter ended June 30, 2003 totaled $73.2 million, compared to $77.9 million for the same period of the prior year, a decline of 6.0 percent. For the quarter ended June 30, 2003, domestic sales revenue declined 2.0 percent and international sales revenue declined 12.0 percent. Operating income for the quarter ended June 30, 2003, declined 29.5 percent, to $2.7 million, compared with $3.9 million for the same period of the prior year. Net income for the quarter totaled $1.1 million, or $0.08 per share on a diluted basis, and reflects the other-than-temporary impairment of an equity investment in the after-tax amount of $1.2 million. Without this impairment, net income per share would have equaled $0.17 per share on a diluted basis. In the same period in 2002, net income totaled $3.0 million, or $0.18 per share on a diluted basis.
For the first half of 2003, sales revenue declined 5.5 percent, to $145.4 million, compared to $153.8 million for the same period of the prior year. Domestic sales revenue for the first six months of 2003 was equal to the comparable period of 2002, while international sales revenue declined 12.9 percent. For the first half of 2003, operating income declined 12.6 percent, to $4.9 million, from $5.7 million in 2002. Net income for the first half of 2003, totaled $2.7 million, or $0.19 per share on a diluted basis, compared with $2.1 million, or $0.13 per share, for the same period of 2002, an increase of $0.6 million.
Results from our international operations for the quarter ended June 30, 2003 included strong sales revenues gains in Ecuador, El Salvador, Israel and the Russian Federation. Japan also posted higher sales revenue. However, these were more than offset by reduced sales revenue in Brazil, Colombia, Costa Rica, Korea and Venezuela.
Nature’s Sunshine worldwide distributors at June 30, 2003 totaled approximately 525,000, compared to approximately 509,000 at December 31, 2002. The number of worldwide managers at June 30, 2003 was approximately 15,200, compared with 14,000 at December 31, 2002.
Our liquidity position remains strong. Working capital at June 30, 2003 totaled $28.8 million, and cash and cash equivalents totaled $25.1 million. In accordance with a previously announced Board-authorized repurchase program, the Company has repurchased approximately 1,326,000 common shares during the first six months of 2003 at an average purchase price of $8.89 per share.
“The business environment in our sector, both domestically and internationally, is challenging. However, the Company’s core strengths continue to be maintained,” said Daniel P. Howells, President and Chief Executive Officer. “The upturn last quarter in Japan and continued strength in several international markets is encouraging, and we are focused on improving our business in other countries as well as identifying new market opportunities.”
About Nature’s Sunshine Products
Nature’s Sunshine Products manufactures and markets through direct sales encapsulated and tableted herbal products, high quality natural vitamins and other complementary products. In addition to the U.S., the Company has operations in South Korea, Brazil, Mexico, Venezuela, Japan, Canada, Colombia, the United Kingdom, Peru, Central America, Ecuador, Israel and Singapore. The Company also has exclusive distribution agreements with selected companies in Argentina, Australia, Chile, Malaysia, New Zealand, Norway and the Russian Federation.
Statements in this press release concerning the Company’s business outlook or future economic performance, anticipated profitability, revenues, expenses or other financial items, and product line growth, together with other statements that are not historical facts, are “forward-looking statements” as that term is defined under Federal Securities Laws. “Forward-looking statements” are subject to risks, uncertainties and other factors, which could cause actual results to differ materially from those set forth in such statements. Such risks, uncertainties and factors include, but are not limited to, foreign business risks, industry cyclicality, fluctuations in customer demand and order pattern, the seasonal nature of the business, changes in pricing and general economic conditions, as well as other risks detailed in the Company’s filings with the Securities and Exchange Commission.
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Contact: |
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Craig D. Huff |
Steven S. Anreder |
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Chief Financial Officer |
Anreder Hirschhorn & Co. |
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Nature’s Sunshine Products, Inc. |
10 East 40th Street, Suite 1308 |
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Provo, Utah 84605-9005 |
New York, NY 10016 |
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(801) 342-4370 |
(212) 532-3232 |
For more information, contact us at our website at www.natr.com.
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NATURE’S SUNSHINE PRODUCTS, INC.
SELECTED STATEMENT OF OPERATIONS INFORMATION
(In thousands, except per share amounts)
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QUARTER ENDED |
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(Unaudited) |
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2003 |
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2002 |
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Sales revenue |
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$ |
73,211 |
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$ |
77,920 |
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Cost of goods sold |
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12,912 |
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13,704 |
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Volume incentives |
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32,422 |
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34,430 |
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Selling, general and administrative |
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25,145 |
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25,912 |
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70,479 |
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74,046 |
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Operating income |
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2,732 |
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3,874 |
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Other income (loss) |
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(1,228 |
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1,434 |
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Income before income taxes |
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1,504 |
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5,308 |
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Provision for income taxes |
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379 |
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2,289 |
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Net income |
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$ |
1,125 |
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$ |
3,019 |
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Basic net income per common share |
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$ |
0.08 |
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$ |
0.19 |
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Basic weighted average common shares |
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13,895 |
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16,088 |
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Diluted net income per common share |
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$ |
0.08 |
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$ |
0.18 |
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Diluted weighted average common shares |
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14,143 |
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16,701 |
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SIX MONTHS ENDED |
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(Unaudited) |
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2003 |
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2002 |
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Sales revenue |
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$ |
145,352 |
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$ |
153,780 |
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Cost of goods sold |
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25,926 |
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27,319 |
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Volume incentives |
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64,522 |
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67,805 |
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Selling, general and administrative |
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49,957 |
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52,999 |
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140,405 |
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148,123 |
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Operating income |
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4,947 |
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5,657 |
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Other loss |
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(935 |
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(838 |
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Income before income taxes |
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4,012 |
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4,819 |
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Provision for income taxes |
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1,283 |
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2,688 |
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Net income |
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$ |
2,729 |
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$ |
2,131 |
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Basic net income per common share |
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$ |
0.19 |
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$ |
0.13 |
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Basic weighted average common shares |
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14,393 |
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16,175 |
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Diluted net income per common share |
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$ |
0.19 |
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$ |
0.13 |
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Diluted weighted average common shares |
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14,615 |
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16,902 |
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3
SELECTED BALANCE SHEET INFORMATION
(In thousands)
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June 30, |
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December 31, |
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(Unaudited) |
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(Unaudited) |
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Cash and cash equivalents |
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$ |
25,126 |
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$ |
26,175 |
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Other current assets |
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47,553 |
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43,053 |
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Total current assets |
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72,679 |
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69,228 |
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Property, plant and equipment |
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34,090 |
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34,621 |
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Other assets |
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14,703 |
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18,073 |
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Total |
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$ |
121,472 |
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$ |
121,922 |
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Current liabilities |
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$ |
43,965 |
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$ |
35,123 |
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Other liabilities |
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3,752 |
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2,899 |
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Shareholders’ equity |
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73,755 |
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83,900 |
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Total |
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$ |
121,472 |
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$ |
121,922 |
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