|
NOTE 14: 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 their geographic operations in the United States (NSP United States) and in countries outside the United States (NSP International). The Company’s third business segment operates under the Synergy Worldwide brand, which distributes its products through different marketing and distributor compensation plans and products with formulations that are sufficiently different from those of the NSP United States and NSP International 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 operating income (loss) by segment before consideration of certain inter-segment transfers and expenses.
Reportable business segment information for the years ended December 31, 2011, 2010 and 2009 is as follows:
|
Year Ended December 31,
|
|
2011
|
|
2010
|
|
2009
|
|
|
Net Sales Revenue:
|
|
|
|
|
|
|
|
|
Nature’s Sunshine Products:
|
|
|
|
|
|
|
|
|
United States
|
|
$
|
138,237
|
|
$
|
141,543
|
|
$
|
146,781
|
|
|
International
|
|
135,661
|
|
139,811
|
|
139,446
|
|
|
|
|
273,898
|
|
281,354
|
|
286,227
|
|
|
Synergy Worldwide
|
|
93,915
|
|
68,564
|
|
55,884
|
|
|
Total net sales revenue
|
|
367,813
|
|
349,918
|
|
342,111
|
|
|
Operating Expenses:
|
|
|
|
|
|
|
|
|
Nature’s Sunshine Products:
|
|
|
|
|
|
|
|
|
United States
|
|
125,920
|
|
135,216
|
|
139,100
|
|
|
International
|
|
137,333
|
|
136,535
|
|
136,272
|
|
|
|
|
263,253
|
|
271,751
|
|
275,372
|
|
|
Synergy Worldwide
|
|
84,395
|
|
66,904
|
|
54,306
|
|
|
Total operating expenses
|
|
347,648
|
|
338,655
|
|
329,678
|
|
|
Operating Income (Loss):
|
|
|
|
|
|
|
|
|
Nature’s Sunshine Products:
|
|
|
|
|
|
|
|
|
United States
|
|
12,317
|
|
6,327
|
|
7,681
|
|
|
International
|
|
(1,672
|
)
|
3,276
|
|
3,174
|
|
|
|
|
10,645
|
|
9,603
|
|
10,855
|
|
|
Synergy Worldwide
|
|
9,520
|
|
1,660
|
|
1,578
|
|
|
Total operating income
|
|
20,165
|
|
11,263
|
|
12,433
|
|
|
|
|
|
|
|
|
|
|
|
Other Income, net
|
|
1,847
|
|
2,727
|
|
2,331
|
|
|
Income Before Provision for Income Taxes
|
|
$
|
22,012
|
|
$
|
13,990
|
|
$
|
14,764
|
|
NSP International’s operating loss of $1,672 for the year ended December 31, 2011, includes $14,750 of contract termination costs related to the Company’s arbitration settlement with NutriPlus LLC (described further in Note 13, Commitments and Contingencies).
The Company moved the reporting of its Dominican Republic market from NSP United States to NSP International during the year ended December 31, 2011, and has made conforming changes to the results presented above for the prior year periods. The net sales revenue and operating loss of this market for the year ended December 31, 2010 were $3,879 and ($467), respectively. The net sales revenue and operating loss of this market for the year ended December 31, 2009 were $5,008 and ($1,083), respectively.
|
Year Ended December 31,
|
|
2011
|
|
2010
|
|
2009
|
|
|
Capital Expenditures:
|
|
|
|
|
|
|
|
|
Nature’s Sunshine Products:
|
|
|
|
|
|
|
|
|
United States
|
|
$
|
744
|
|
$
|
1,717
|
|
$
|
2,007
|
|
|
International
|
|
315
|
|
181
|
|
535
|
|
|
|
|
1,059
|
|
1,898
|
|
2,542
|
|
|
Synergy Worldwide
|
|
1,183
|
|
779
|
|
296
|
|
|
Total capital expenditures
|
|
$
|
2,242
|
|
$
|
2,677
|
|
$
|
2,838
|
|
|
|
|
|
|
|
|
|
|
|
Depreciation and Amortization:
|
|
|
|
|
|
|
|
|
Nature’s Sunshine Products:
|
|
|
|
|
|
|
|
|
United States
|
|
$
|
2,968
|
|
$
|
2,920
|
|
$
|
2,908
|
|
|
International
|
|
902
|
|
824
|
|
692
|
|
|
|
|
3,870
|
|
3,744
|
|
3,600
|
|
|
Synergy Worldwide
|
|
492
|
|
510
|
|
901
|
|
|
Total depreciation and amortization
|
|
$
|
4,362
|
|
$
|
4,254
|
|
$
|
4,501
|
|
|
As of December 31,
|
|
2011
|
|
2010
|
|
|
Assets:
|
|
|
|
|
|
|
Nature’s Sunshine Products
|
|
|
|
|
|
|
United States
|
|
$
|
88,575
|
|
$
|
81,235
|
|
|
International
|
|
44,938
|
|
42,256
|
|
|
|
|
133,513
|
|
123,491
|
|
|
Synergy Worldwide
|
|
42,298
|
|
35,924
|
|
|
Total Assets
|
|
$
|
175,811
|
|
$
|
159,415
|
|
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, 2011, 2010 and 2009 as follows:
|
Year Ended December 31,
|
|
2011
|
|
2010
|
|
2009
|
|
|
Net Sales Revenue:
|
|
|
|
|
|
|
|
|
United States
|
|
$
|
159,471
|
|
$
|
156,767
|
|
$
|
154,217
|
|
|
Other
|
|
208,342
|
|
193,151
|
|
187,894
|
|
|
Total Net Sales Revenue
|
|
$
|
367,813
|
|
$
|
349,918
|
|
$
|
342,111
|
|
Revenue generated by each of the Company’s product lines is set forth below (U.S. dollars in thousands):
|
Year Ended December 31,
|
|
2011
|
|
2010
|
|
2009
|
|
|
NSP United States:
|
|
|
|
|
|
|
|
|
Herbal Products
|
|
$
|
73,467
|
|
$
|
67,792
|
|
$
|
71,130
|
|
|
Vitamins and Mineral and Other Nutritional Supplements
|
|
56,442
|
|
64,441
|
|
64,767
|
|
|
Personal Care Products
|
|
4,361
|
|
4,324
|
|
4,598
|
|
|
Other Products
|
|
3,967
|
|
4,986
|
|
6,286
|
|
|
|
|
138,237
|
|
141,543
|
|
146,781
|
|
|
NSP International:
|
|
|
|
|
|
|
|
|
Herbal Products
|
|
$
|
73,560
|
|
$
|
77,606
|
|
$
|
79,951
|
|
|
Vitamins and Mineral and Other Nutritional Supplements
|
|
49,734
|
|
51,827
|
|
47,405
|
|
|
Personal Care Products
|
|
10,621
|
|
8,238
|
|
9,689
|
|
|
Other Products
|
|
1,746
|
|
2,140
|
|
2,401
|
|
|
|
|
135,661
|
|
139,811
|
|
139,446
|
|
|
Synergy WorldWide:
|
|
|
|
|
|
|
|
|
Herbal Products
|
|
$
|
33,563
|
|
$
|
28,045
|
|
$
|
26,395
|
|
|
Vitamins and Mineral and Other Nutritional Supsplements
|
|
50,936
|
|
32,296
|
|
19,256
|
|
|
Personal Care Products
|
|
7,526
|
|
6,542
|
|
7,838
|
|
|
Other Products
|
|
1,890
|
|
1,681
|
|
2,395
|
|
|
|
|
93,915
|
|
68,564
|
|
55,884
|
|
|
Total Net Sales Revenue
|
|
$
|
367,813
|
|
$
|
349,918
|
|
$
|
342,111
|
|
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
|
|
2011
|
|
2010
|
|
|
Property, plant and equipment
|
|
|
|
|
|
|
United States
|
|
$
|
18,119
|
|
$
|
20,350
|
|
|
Venezuela
|
|
3,939
|
|
4,353
|
|
|
Other
|
|
3,079
|
|
2,688
|
|
|
Total property, plant and equipment
|
|
$
|
25,137
|
|
$
|
27,391
|
|
|