Quarterly report pursuant to Section 13 or 15(d)

Segment Information

v3.8.0.1
Segment Information
 9 Months Ended
Sep. 30, 2017
Segment Reporting [Abstract]  
Segment Information
Segment Information
 
The Company has four business segments. These business segments are components of the Company for which separate information is available and evaluated regularly by the chief executive officer in deciding how to allocate resources and in assessing relative performance.
 
The Company's four business segments are divided based on the different characteristics of their distributor and customer bases, distributor compensation plans and product formulations, as well as the internal organization of its officers and their responsibilities and business operations. Three business segments operate under the Nature’s Sunshine Products brand (NSP Americas; NSP Russia, Central and Eastern Europe; and China and New Markets), and one business segment operates under the Synergy® WorldWide brand.

Reportable business segment information is as follows (dollar amounts in thousands):
 
 
Three Months Ended
September 30,
 
Nine Months Ended
September 30,
 
2017
 
2016
 
2017
 
2016
Net sales:
 

 
 

 
 

 
 

NSP Americas
$
41,301

 
$
43,260

 
$
125,367

 
$
133,168

NSP Russia, Central and Eastern Europe
7,129

 
6,421

 
21,398

 
19,042

Synergy WorldWide
34,470

 
31,331

 
92,146

 
94,192

China and New Markets
6,401

 
4,429

 
14,832

 
10,807

Total net sales
89,301

 
85,441

 
253,743

 
257,209

 
 
 
 
 
 
 
 
Contribution margin (1):
 

 
 

 
 

 
 

NSP Americas
17,764

 
19,057

 
53,454

 
57,077

NSP Russia, Central and Eastern Europe
2,335

 
2,231

 
7,090

 
6,477

Synergy WorldWide
10,160

 
9,556

 
27,769

 
28,740

China and New Markets
4,821

 
3,401

 
11,013

 
7,953

Total contribution margin
35,080

 
34,245

 
99,326

 
100,247

 
 
 
 
 
 
 
 
Selling, general and administrative expenses (2)
32,926

 
29,187

 
95,098

 
88,821

Operating income
2,154

 
5,058

 
4,228

 
11,426

 
 
 
 
 
 
 
 
Other income, net
193

 
20

 
1,909

 
957

Income before provision for income taxes
$
2,347

 
$
5,078

 
$
6,137

 
$
12,383

_________________________________________

(1)   Contribution margin consists of net sales less cost of sales and volume incentives expense.

(2)  Service fees in the China and New Markets segment related to sales in China, occurring after the Company's receipt of its direct selling license and pre-opening product sales through Hong Kong, totaled $2.1 million and $4.7 million for the three and nine-month periods ended September 30, 2017, respectively, compared to $1.5 million and $3.4 million for the three and nine-month periods ended September 30, 2016. These service fees are included in the Company's selling, general and administrative expenses.

From an individual country perspective, only the United States and South Korea comprise 10 percent or more of consolidated net sales for the three and nine-month periods ended September 30, 2017 and 2016, as follows (dollar amounts in thousands):
 
 
Three Months Ended
September 30,
 
Nine Months Ended
September 30,
 
2017
 
2016
 
2017
 
2016
Net sales:
 

 
 

 
 

 
 

United States
$
35,124

 
$
36,473

 
$
106,664

 
$
112,366

South Korea
14,371

 
14,083

 
38,203

 
42,754

Other
39,806

 
34,885

 
108,876

 
102,089

 
$
89,301

 
$
85,441

 
$
253,743

 
$
257,209



Net Sales generated by each of the Company’s product lines is set forth below (dollar amounts in thousands):
 
 
Three Months Ended
September 30,
 
Nine Months Ended
September 30,
 
2017
 
2016
 
2017
 
2016
NSP Americas:
 

 
 

 
 

 
 

General health
$
18,211

 
$
19,063

 
$
56,258

 
$
58,914

Immune
4,938

 
4,599

 
13,180

 
13,913

Cardiovascular
3,434

 
3,193

 
9,570

 
9,723

Digestive
11,084

 
11,684

 
34,892

 
36,608

Personal care
2,114

 
1,925

 
5,487

 
5,708

Weight management
1,520

 
2,796

 
5,980

 
8,302

 
41,301

 
43,260

 
125,367

 
133,168

NSP Russia, Eastern and Central Europe:
 

 
 

 
 

 
 

General health
$
3,192

 
$
2,732

 
$
9,691

 
$
7,956

Immune
789

 
650

 
2,190

 
2,047

Cardiovascular
542

 
538

 
1,553

 
1,508

Digestive
1,983

 
1,741

 
5,890

 
5,269

Personal care
443

 
517

 
1,475

 
1,619

Weight management
180

 
243

 
599

 
643

 
7,129

 
6,421

 
21,398

 
19,042

Synergy WorldWide:
 

 
 

 
 

 
 

General health
$
9,268

 
$
8,711

 
$
23,579

 
$
27,045

Immune
119

 
205

 
357

 
455

Cardiovascular
14,369

 
13,188

 
38,075

 
39,386

Digestive
4,428

 
3,383

 
12,047

 
9,312

Personal care
1,891

 
1,838

 
5,884

 
5,725

Weight management
4,395

 
4,006

 
12,204

 
12,269

 
34,470

 
31,331

 
92,146

 
94,192

China and New Markets:
 

 
 

 
 

 
 

General health
$
1,409

 
$
575

 
$
3,374

 
$
2,583

Immune
251

 
206

 
517

 
553

Cardiovascular
961

 
948

 
2,514

 
2,471

Digestive
2,559

 
2,118

 
6,014

 
3,640

Personal care
144

 
189

 
265

 
650

Weight management
1,077

 
393

 
2,148

 
910

 
6,401

 
4,429

 
14,832

 
10,807

 
$
89,301

 
$
85,441

 
$
253,743

 
$
257,209



From an individual country perspective, only the United States comprised 10 percent or more of consolidated property, plant and equipment as follows (dollar amounts in thousands):
 
 
September 30,
2017
 
December 31,
2016
Property, plant and equipment:
 

 
 

United States
$
67,454

 
$
70,770

Other
2,721

 
2,502

Total property, plant and equipment
$
70,175

 
$
73,272