Exhibit 99.1

 

FOR IMMEDIATE RELEASE

 

NATURE’S SUNSHINE REPORTS RECORD 2004 REVENUES,

OPERATING INCOME UP 181 Percent, PROFITS INCREASE 235 Percent

------

Fourth Quarter Operating Results Show Continued Strong Gains,

With Domestic Net Sales Revenues Ahead 8 Percent

 

PROVO, UTAH, February 15, 2005 – Nature’s Sunshine Products, Inc. (NASDAQ:NATR), a leading manufacturer and marketer of encapsulated herbs and vitamins, today reported record sales revenue and strong gains in operating and net income for both the fourth quarter and year ended December 31, 2004.

 

For the twelve months ended December 31, 2004, net sales revenue increased to $331.1 million, compared with $260.2 million in the same period of 2003, an increase of 27.3 percent.   Operating income advanced 181.0 percent, to $21.7 million, from $7.7 million the previous year.  Net income totaled $17.1 million, or $1.10 per diluted share, for the year ended December 31, 2004 compared to $5.1 million, or $0.36 per diluted share for the same period in the prior year.

 

For the fourth quarter ended December 31, 2004, net sales revenues increased to $88.3 million, compared with $68.8 million in the same period in the prior year, a 28.3 percent increase.  Operating income totaled $6.5 million, compared with $3.8 million in the same period in the prior year, a 70.6 percent increase. Net income increased to $4.7 million, or $0.30 per diluted share, from $2.9 million, or $0.21 per diluted share, increases of 58.9 and 43.3 percent, respectively, over the same period in the prior year.  Per share calculations are based on 10.9 percent more weighted average diluted shares outstanding in the 2004 fourth quarter and 8.0 percent more diluted shares for the full year.

 

Selling, general and administrative (“SG&A”) expenses in line with the Company’s objectives continued to decline as a percentage of net sales revenues.  For the fourth quarter, SG&A totaled 33.4 as a percent of net sales revenues, compared with 39.6 percent a year ago, and for the year ended December 31, 2004 it totaled 35.9 percent, compared to 41.0 percent for the same period in the prior year.  The Company’s objective is to continue to reduce SG&A as a percentage of net sales revenues.

 

“Nature’s Sunshine made considerable progress in 2004,” said Douglas Faggioli, President and CEO.  “In addition to our success in continuing to reduce expenses, we achieved a 7.7 percent increase in United States net sales revenue in the fourth quarter, the first year over year quarterly gain in some time. This was accomplished while maintaining strong momentum in our international operation as well as in Synergy Worldwide.  New products and new marketing initiatives clearly are beginning to pay off.  Our Dutch auction tender offer in November was very successful.  Overall we believe the outlook for the Company’s growth continues to be positive.”

 

Synergy Worldwide, which operates principally in Asia, continued to experience rapid sales revenue growth. Fourth quarter net sales revenue increased 124.0 percent, to $23.5 million compared with $10.5 million during the same period of the prior year. Net sales revenue for the

 



 

twelve months ended December 31, 2004, totaled $83.6 million compared with $26.9 million for 2003, an increase of 210.5 percent.

 

United States, net sales revenue for the fourth quarter, which includes the Dominican Republic, increased 7.7 percent to $36.8 million, compared to $34.2 million in the same period of the prior year.  The Company attributed the 2004 fourth quarter improvement to new products, such as Thai-Go, and new marketing initiatives, particularly its Habit of Health™ 90-Day Challenge program. Domestic sales revenue for the full year totaled $142.8 million, compared with $143.6 million in 2003.

 

International net sales revenue for the fourth quarter totaled $28.0 million, compared to $24.1 million, a 15.9 percent increase, and for the year totaled $104.6 million, compared with $89.6 million the prior year, an increase of 16.7 percent.  Fifteen countries posted higher sales revenue, most noticeably Canada, Colombia, El Salvador, Israel, Japan, Mexico, and Russia.

 

As previously disclosed, on November 30, 2004 the Company announced that it had purchased 1,000,000 shares of common stock at a purchase price of $16.50 per share, pursuant to a Dutch auction tender offer. The proration factor for the tender offer was approximately 67.42 percent.

 

As of December 31, 2004, working capital totaled $40.7 million, cash and cash equivalents and investments amounted to $44.0 million, total liabilities were approximately $53.9 million and shareholders’ equity increased to $91.2 million.

 

Nature’s Sunshine had approximately 665,000 Distributors worldwide at December 31, 2004, compared to 562,000 a year earlier.  The numbers of Managers worldwide on the same dates were approximately 18,350 and 15,150, respectively.

 

About Nature’s Sunshine

 

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 United States, the Company has operations in Japan, Mexico, Central America, South Korea, Canada, Dominican Republic, Venezuela, Ecuador, Peru, the United Kingdom and Ireland, Colombia, Brazil, Thailand, Israel, Singapore and Taiwan.  The Company also has exclusive distribution agreements with selected companies in Argentina, Australia, Chile, 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, changes in pricing and general economic conditions, as well as other risks detailed in the Company’s filings with the Securities and Exchange Commission.

 



 

Conference Call Schedule

 

A conference call will be held on Tuesday, February 15, 2005, at 11am (ET) and can be accessed live over the Internet through World Investor Link’s Vcall website, located at http://www.vcall.com.  To listen to the live call, individuals should go to the web site at least 15 minutes early to register, download and install any necessary audio software.  A replay on the Vcall website will be available for one week after the original broadcast.  A rebroadcast of the call will be available starting approximately two hours after the conference call ends, through midnight (ET) on Tuesday, March 1, 2005.  The replay of the conference call can be accessed by dialing 1-877-519-4471, and, when prompted, use PIN number 5691049. International callers dial (973) 341-3080 and use the same PIN number.

 

Contact:

 

 

Craig D. Huff

 

Steven S. Anreder

Chief Financial Officer

 

Anreder & Co.

Nature’s Sunshine Products, Inc.

 

10 East 40th Street, Suite1308

Provo, Utah 84605-9005

 

New York, NY 10016

(801) 342-4370

 

(212) 532-3232

 

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NATURE’S SUNSHINE PRODUCTS, INC.

FINANCIAL SUMMARY

 

SELECTED STATEMENT OF OPERATIONS INFORMATION

(In thousands, except per share amounts)

 

 

 

THREE MONTHS ENDED
DECEMBER 31

 

 

 

(Unaudited)

 

 

 

2004

 

2003

 

Net sales revenue

 

$

88,343

 

$

68,845

 

 

 

 

 

 

 

Cost of goods sold

 

17,350

 

12,773

 

Volume incentives

 

34,999

 

24,982

 

Selling, general and administrative

 

29,499

 

27,283

 

 

 

81,848

 

65,038

 

Operating income

 

6,495

 

3,807

 

Other income, net

 

404

 

241

 

Income before income taxes

 

6,899

 

4,048

 

Provision for income taxes

 

2,238

 

1,114

 

Net income

 

$

4,661

 

$

2,934

 

Basic net income per common share

 

$

0.31

 

$

0.21

 

Basic weighted average common shares

 

15,128

 

14,015

 

Diluted net income per common share

 

$

0.30

 

$

0.21

 

Diluted weighted average common shares

 

15,655

 

14,116

 

 

 

 

 

TWELVE MONTHS ENDED
DECEMBER 31

 

 

 

(Unaudited)

 

 

 

2004

 

2003

 

Net sales revenue

 

$

331,063

 

$

260,151

 

 

 

 

 

 

 

Cost of goods sold

 

62,693

 

51,927

 

Volume incentives

 

127,985

 

93,910

 

Selling, general and administrative

 

118,731

 

106,608

 

 

 

309,409

 

252,445

 

Operating income

 

21,654

 

7,706

 

Other income (expense), net

 

1,307

 

(474

)

Income before income taxes

 

22,961

 

7,232

 

Provision for income taxes

 

5,883

 

2,133

 

Net income

 

$

17,078

 

$

5,099

 

Basic net income per common share

 

$

1.14

 

$

0.36

 

Basic weighted average common shares

 

14,917

 

14,181

 

Diluted net income per common share

 

$

1.10

 

$

0.36

 

Diluted weighted average common shares

 

15,478

 

14,336

 

 



 

SELECTED BALANCE SHEET INFORMATION

(In thousands)

 

 

 

 

December 31,
2004

 

December 31,
2003

 

 

 

(Unaudited)

 

 

 

Cash and cash equivalents

 

$

36,206

 

$

30,665

 

Other current assets

 

56,300

 

45,371

 

Total current assets

 

92,506

 

76,036

 

Property, plant and equipment

 

34,731

 

32,318

 

Other assets

 

17,838

 

17,204

 

Total

 

$

145,075

 

$

125,558

 

 

 

 

 

 

 

Current liabilities

 

$

51,812

 

$

45,984

 

Other liabilities

 

2,045

 

2,232

 

Shareholders’ equity

 

91,218

 

77,342

 

Total

 

$

145,075

 

$

125,558