| OPERATING BUSINESS SEGMENT AND INTERNATIONAL OPERATION INFORMATION |
NOTE 13: OPERATING BUSINESS SEGMENT AND INTERNATIONAL OPERATION INFORMATION
The Company has three business segments. These business segments are components of the Company for which separate information is available that is evaluated regularly by the chief executive officer in deciding how to allocate resources and in assessing relative performance.
The Company has two business segments that operate under the Nature’s Sunshine Products brand and 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, Asia Pacific and Europe; and NSP Russia, Central and Eastern Europe). The Company’s third business segment operates under the Synergy WorldWide brand, which distributes its products through different selling and Distributor compensation plans and products with formulations that are sufficiently different from those of the NSP Americas, Asia Pacific and Europe; and NSP Russia, Central and Eastern Europe to warrant accounting for these operations as a separate business segment. Net sales revenues for each segment have been reduced by intercompany sales as they are not included in the measure of segment profit or loss reviewed by the chief executive officer. The Company evaluates performance based on contribution margin (loss) by segment before consideration of certain inter-segment transfers and expenses.
Reportable business segment information for the years ended December 31, 2013, 2012 and 2011 is as follows:
|
Year Ended December 31,
|
|
2013
|
|
2012
|
|
2011
|
|
|
Net sales revenue:
|
|
|
|
|
|
|
|
|
NSP Americas, Asia Pacific and Europe
|
|
$
|
207,059
|
|
$
|
208,945
|
|
$
|
216,912
|
|
|
NSP Russia, Central and Eastern Europe
|
|
62,747
|
|
57,853
|
|
56,986
|
|
|
Synergy WorldWide
|
|
108,290
|
|
100,670
|
|
93,915
|
|
|
Total net sales revenue
|
|
378,096
|
|
367,468
|
|
367,813
|
|
|
Contribution margin (1):
|
|
|
|
|
|
|
|
|
NSP Americas, Asia Pacific and Europe
|
|
84,247
|
|
82,778
|
|
86,004
|
|
|
NSP Russia, Central and Eastern Europe
|
|
22,542
|
|
21,957
|
|
22,374
|
|
|
Synergy WorldWide
|
|
38,011
|
|
36,142
|
|
36,143
|
|
|
Total contribution margin
|
|
144,800
|
|
140,877
|
|
144,521
|
|
|
|
|
|
|
|
|
|
|
|
Selling, general and administrative
|
|
120,743
|
|
106,861
|
|
109,606
|
|
|
Contract termination costs
|
|
—
|
|
—
|
|
14,750
|
|
|
Operating income
|
|
24,057
|
|
34,016
|
|
20,165
|
|
|
|
|
|
|
|
|
|
|
|
Other income, net
|
|
1,596
|
|
1,480
|
|
1,847
|
|
|
Income before provision for income taxes
|
|
$
|
25,653
|
|
$
|
35,496
|
|
$
|
22,012
|
|
(1) Contribution margin consists of net sales revenue less cost of sales and volume incentives expense.
|
Year Ended December 31,
|
|
2013
|
|
2012
|
|
2011
|
|
|
Capital expenditures:
|
|
|
|
|
|
|
|
|
NSP Americas, Asia Pacific and Europe
|
|
$
|
8,018
|
|
$
|
5,684
|
|
$
|
993
|
|
|
NSP Russia, Central and Eastern Europe
|
|
4
|
|
44
|
|
66
|
|
|
Synergy WorldWide
|
|
534
|
|
1,051
|
|
1,183
|
|
|
Total capital expenditures
|
|
$
|
8,556
|
|
$
|
6,779
|
|
$
|
2,242
|
|
|
|
|
|
|
|
|
|
|
|
Depreciation and amortization:
|
|
|
|
|
|
|
|
|
NSP Americas, Asia Pacific and Europe
|
|
$
|
3,568
|
|
$
|
3,339
|
|
$
|
3,827
|
|
|
NSP Russia, Central and Eastern Europe
|
|
27
|
|
36
|
|
43
|
|
|
Synergy WorldWide
|
|
871
|
|
703
|
|
492
|
|
|
Total depreciation and amortization
|
|
$
|
4,466
|
|
$
|
4,078
|
|
$
|
4,362
|
|
|
As of December 31,
|
|
2013
|
|
2012
|
|
|
Assets:
|
|
|
|
|
|
|
NSP Americas, Asia Pacific and Europe
|
|
$
|
148,278
|
|
$
|
136,237
|
|
|
NSP Russia, Central and Eastern Europe
|
|
11,233
|
|
8,558
|
|
|
Synergy WorldWide
|
|
40,101
|
|
49,124
|
|
|
Total assets
|
|
$
|
199,612
|
|
$
|
193,919
|
|
From an individual country perspective, only the United States comprises approximately 10 percent or more of consolidated net sales revenue for any of the years ended December 31, 2013, 2012 and 2011 as follows:
|
Year Ended December 31,
|
|
2013
|
|
2012
|
|
2011
|
|
|
Net sales revenue:
|
|
|
|
|
|
|
|
|
United States
|
|
$
|
152,209
|
|
$
|
154,716
|
|
$
|
159,471
|
|
|
Other
|
|
225,887
|
|
212,752
|
|
208,342
|
|
|
Total net sales revenue
|
|
$
|
378,096
|
|
$
|
367,468
|
|
$
|
367,813
|
|
Revenue generated by each of the Company’s product lines is set forth below (U.S. dollars in thousands):
|
Year Ended December 31,
|
|
2013
|
|
2012
|
|
2011
|
|
|
NSP Americas, Asia Pacific and Europe:
|
|
|
|
|
|
|
|
|
General health
|
|
$
|
88,239
|
|
$
|
91,994
|
|
$
|
95,342
|
|
|
Immunity
|
|
25,187
|
|
25,331
|
|
26,099
|
|
|
Cardiovascular
|
|
14,004
|
|
13,897
|
|
15,095
|
|
|
Digestive
|
|
59,877
|
|
58,127
|
|
62,175
|
|
|
Personal care
|
|
5,543
|
|
6,400
|
|
5,908
|
|
|
Weight management
|
|
14,209
|
|
13,196
|
|
12,293
|
|
|
|
|
207,059
|
|
208,945
|
|
216,912
|
|
|
NSP Russia, Central and Eastern Europe:
|
|
|
|
|
|
|
|
|
General health
|
|
$
|
22,690
|
|
$
|
20,540
|
|
$
|
19,448
|
|
|
Immunity
|
|
7,902
|
|
7,365
|
|
7,558
|
|
|
Cardiovascular
|
|
4,324
|
|
4,367
|
|
5,342
|
|
|
Digestive
|
|
15,693
|
|
14,501
|
|
14,857
|
|
|
Personal care
|
|
8,817
|
|
8,908
|
|
7,848
|
|
|
Weight management
|
|
3,321
|
|
2,172
|
|
1,933
|
|
|
|
|
62,747
|
|
57,853
|
|
56,986
|
|
|
Synergy WorldWide:
|
|
|
|
|
|
|
|
|
General health
|
|
$
|
36,723
|
|
$
|
33,969
|
|
$
|
29,592
|
|
|
Immunity
|
|
1,394
|
|
1,104
|
|
802
|
|
|
Cardiovascular
|
|
42,154
|
|
42,696
|
|
41,163
|
|
|
Digestive
|
|
16,897
|
|
14,904
|
|
13,606
|
|
|
Personal care
|
|
7,097
|
|
5,631
|
|
6,674
|
|
|
Weight management
|
|
4,025
|
|
2,366
|
|
2,078
|
|
|
|
|
108,290
|
|
100,670
|
|
93,915
|
|
|
Total net sales revenue
|
|
$
|
378,096
|
|
$
|
367,468
|
|
$
|
367,813
|
|
From an individual country perspective, only the United States and Venezuela comprise 10 percent or more of consolidated property, plant and equipment as follows:
|
As of December 31
|
|
2013
|
|
2012
|
|
|
Property, plant and equipment
|
|
|
|
|
|
|
United States
|
|
$
|
25,713
|
|
$
|
20,923
|
|
|
Venezuela
|
|
3,207
|
|
3,535
|
|
|
Other
|
|
3,102
|
|
3,492
|
|
|
Total property, plant and equipment
|
|
$
|
32,022
|
|
$
|
27,950
|
|
|