PROVO, Utah, Aug. 6, 2015 /PRNewswire/ -- Nu Skin Enterprises, Inc. (NYSE: NUS) today announced second-quarter results with revenue of $560.2 million compared to $650.0 million in the prior-year period. Revenue in the quarter was negatively impacted 7 percent by foreign currency fluctuations. Revenue in the second quarter of 2014 included $76 million in limited-time offer product sales, while there were no significant limited-time offers during the second quarter of 2015. Earnings per share for the quarter were $0.75, compared to $0.32 in the prior-year period which included a $50 million inventory write-down and a $25 million foreign currency charge related to Venezuela.

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"We are pleased the business performed at the high end of our expectations for the second quarter," said Truman Hunt, president and chief executive officer. "Additionally, we are encouraged by growth in the number of sales leaders sequentially, including a 19 percent increase in sales leaders in Mainland China. We believe that this trend signals growing sales leader energy as we build toward the introduction of our new ageLOC products in the second half of the year.

"Additionally, our financial performance and strong cash flow enabled us to repurchase approximately $50 million of shares in the second quarter. Overall, we are pleased with the direction of the business and continue to anticipate a return to revenue growth in the second half of the year."

Regional Results

The company's regional revenue results for the three-month periods ended June 30 are presented in the following table.



                           2015     2014      %       Constant Currency

                                         Change          % Change
                                         ------          --------


    Greater China      $200,136 $229,869        (13%)                  (13%)

    North Asia          172,943  195,995        (12%)                   (2%)

    Americas             83,468   89,911         (7%)                     5%

    South Asia/Pacific   68,023   81,653        (17%)                   (9%)

    EMEA                 35,639   52,599        (32%)                  (16%)
                         ------   ------


    Total              $560,209 $650,027        (14%)                   (7%)
                       ======== ========

The company's regional revenue results for the six-month periods ended June 30 are presented in the following table.



                             2015       2014      %       Constant Currency

                                             Change          % Change
                                             ------          --------


    Greater China        $387,503   $508,798        (24%)                  (23%)

    North Asia            345,009    391,456        (12%)                   (4%)

    Americas              163,340    169,820         (4%)                    12%

    South Asia/Pacific    138,840    152,847         (9%)                   (2%)

    EMEA                   68,849     98,167        (30%)                  (13%)
                           ------     ------


    Total              $1,103,541 $1,321,088        (16%)                  (10%)
                       ========== ==========

The company's regional actives and sales leaders statistics are presented in the following table.



                  As of June 30, 2015           As of June 30, 2014                % Increase (Decrease)
                  -------------------           -------------------                --------------------

                                      Actives                       Sales Leaders                        Actives    Sales Leaders    Actives     Sales Leaders
                                      -------                       -------------                        -------    -------------    -------     -------------


    Greater China                       215,000                             25,956                          256,000           26,192     (16.0%)            (0.9%)

    North Asia                          387,000                             16,991                          393,000           17,186      (1.5%)            (1.1%)

    Americas                            180,000                              7,892                          189,000            7,627      (4.8%)              3.5%

    South Asia/
     Pacific                            120,000                              7,279                          120,000            7,450           -            (2.3%)

    EMEA                                113,000                              4,042                          121,000            4,468      (6.6%)            (9.5%)
                                        -------                              -----                          -------            -----


    Total                             1,015,000                             62,160                        1,079,000           62,923      (5.9%)            (1.2%)
                                      =========                             ======                        =========           ======


    ____________________

    "Actives" are persons who purchased products directly
     from the company during the previous three months.


    "Sales Leaders" are independent distributors, and sales
     employees and independent marketers in China, who
     achieve certain qualification requirements.

Operational Performance

The company's operating margin for the quarter was 12.8 percent, compared to 8.4 percent in the second quarter of 2014. Gross margin during the quarter was 80.3 percent, versus 76.0 percent in the prior-year period. Last year's gross margin was unusually low due to the inventory write-down. Selling expenses were 42.7 percent of sales in the second quarter, compared to 43.6 percent in the prior-year period. General and administrative expenses were 24.8 percent of sales compared to 24.0 percent in the prior-year period. The company's effective income tax rate for the quarter was 35.3 percent, compared to 42.0 percent in the prior year. Last year's tax rate was abnormally high due to the tax impact of a foreign currency charge related to Venezuela. Cash and current investments at the end of the quarter were $303.9 million and debt was $252.1 million. Dividend payments during the quarter were $20.5 million. Cash flow from operations for the quarter was $85.4 million, and the company repurchased $49.6 million of its outstanding shares.

Outlook

"Sales leader enthusiasm continues to build for our upcoming limited-time product launches that include ageLOC Youth, our most advanced anti-aging supplement, as well as ageLOC Me, a unique anti-aging skin care system that enables consumers to personalize a daily regimen based on individual preferences and skin care needs," said Hunt. "These new ageLOC products will be highlighted at our global sales leader convention in early October, and we anticipate they will help drive healthy year-over-year growth in the second half of 2015. We expect this momentum to continue as we begin to roll these products out on a full-time basis in 2016.

"We are also pleased with our progress in several key markets, particularly Mainland China, where we generated healthy sequential growth in both sales leaders and revenue. In the Greater China region, we will be rolling out our ageLOC Essentials line of cosmetic oils in the third quarter. As we move closer to our product launches, we expect positive trends to continue in our global sales force, and also anticipate growth in our active consumer base," concluded Hunt.

"We project second-half local-currency revenue growth of approximately 15 percent," said Ritch Wood, chief financial officer. "Our prior guidance anticipated a negative foreign currency impact of 7 percent in the third and fourth quarters. We now project a negative impact of 10 to 11 percent. Given this impact, we anticipate third-quarter revenue will be in the $600 to $620 million range with earnings per share of $0.96 to $1.00. We anticipate annual revenue to be in the $2.40 to $2.44 billion range, with earnings per share of $3.47 to $3.55 which includes a $0.12 expense associated with the Venezuela foreign currency charge in the first quarter of this year. Excluding this charge, earnings guidance would be in the range of $3.59 to $3.67. Including currency impact, this guidance reflects second-half reported revenue growth of between 5 and 6 percent," concluded Wood.

The Nu Skin management team will host a conference call with the investment community on Aug. 6, 2015, at 5 p.m. (EDT). Those wishing to access the webcast, as well as the financial information presented during the call, can visit the Investor Relations page on the company's website at ir.nuskin.com. A replay of the webcast will be available at the same URL through Aug. 21, 2015.

About Nu Skin Enterprises, Inc.

Nu Skin Enterprises, Inc. demonstrates its tradition of innovation through its comprehensive anti-aging product portfolio, independent business opportunity and corporate social responsibility initiatives. The company's scientific leadership in both skin care and nutrition has established Nu Skin as a premier anti-aging company. The company's anti-aging products feature the ageLOC(®) line of products including ageLOC(®) Tru Face(®) Essence Ultra firming serum, the ageLOC(®) TR90(®) weight management and body shaping system, ageLOC(®) R(2) nutritional supplement, and ageLOC(®) Transformation daily skin care system. A global direct selling company, Nu Skin operates in 53 markets worldwide and is traded on the New York Stock Exchange under the symbol "NUS." More information is available at http://www.nuskin.com.

Please Note: This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, that represent the company's current expectations and beliefs. All statements other than statements of historical fact are "forward-looking statements" for purposes of federal and state securities laws and include, but are not limited to, statements of management's expectations regarding the company's performance, growth, new product introductions, sales force and consumer base; projections regarding revenue, earnings per share, foreign currency fluctuations and other financial items; statements of belief; and statements of assumptions underlying any of the foregoing. In some cases, you can identify these statements by forward-looking words such as "believe," "expect," "project," "anticipate," "estimate," "intend," "plan," "targets," "likely," "will," "would," "could," "may," "might," the negative of these words and other similar words.

The forward-looking statements and related assumptions involve risks and uncertainties that could cause actual results and outcomes to differ materially from any forward-looking statements or views expressed herein. These risks and uncertainties include, but are not limited to, the following:


    --  any failure of current or planned initiatives or products to generate
        interest among our sales force and customers and generate sponsoring and
        selling activities on a sustained basis;
    --  risk of foreign currency fluctuations and the currency translation
        impact on the company's business associated with these fluctuations;
    --  risk that direct selling laws and regulations in any of our markets,
        including the United States and China, may be modified, interpreted or
        enforced in a manner that results in negative changes to our business
        model or negatively impacts our revenue, sales force or business,
        including through the interruption of sales activities, loss of
        licenses, imposition of fines, or any other adverse actions or events;
    --  risks related to accurately predicting, delivering or maintaining
        sufficient quantities of products to support our planned initiatives or
        launch strategies, and increased risk of inventory write-offs if we
        over-forecast demand for a product or change our planned initiatives or
        launch strategies;
    --  regulatory risks associated with the company's products, which could
        require the company to modify its claims or inhibit the company's
        ability to import or continue selling a product in a market if it is
        determined to be a medical device or if it is unable to register the
        product in a timely manner under applicable regulatory requirements;
    --  adverse publicity related to the company's business, products, industry
        or any legal actions or complaints by the company's sales force or
        others;
    --  unpredictable economic conditions and events globally;
    --  any prospective or retrospective increases in duties on the company's
        products imported into the company's markets outside of the United
        States and any adverse results of tax audits or unfavorable changes to
        tax laws in the company's various markets; and
    --  continued competitive pressures in the company's markets.

The company's financial performance and the forward-looking statements contained herein are further qualified by a detailed discussion of associated risks set forth in the documents filed by the company with the Securities and Exchange Commission. The forward-looking statements set forth the company's beliefs as of the date that such information was first provided and the company assumes no duty to update the forward-looking statements contained in this release to reflect any change except as required by law.


                       NU SKIN ENTERPRISES, INC.

             Consolidated Statements of Income (Unaudited)

          For the Second Quarters Ended June 30, 2015 and 2014

                (in thousands, except per share amounts)


                                                         2015       2014
                                                         ----       ----


    Revenue                                          $560,209   $650,027


    Cost of sales                                     110,263    156,010
                                                      -------    -------


    Gross profit                                      449,946    494,017
                                                      -------    -------


    Operating expenses:

            Selling expenses                          239,449    283,575

            General and administrative expenses       138,696    155,705
                                                      -------    -------

    Total operating expenses                          378,145    439,280
                                                      -------    -------


    Operating income                                   71,801     54,737


    Other income (expense), net                       (2,758)  (21,119)
                                                       ------    -------

    Income before provision for income
     taxes                                             69,043     33,618

    Provision for income taxes                         24,386     14,111
                                                       ------     ------


    Net income                                        $44,657    $19,507
                                                      =======    =======


    Net income per share:

            Basic                                       $0.76      $0.33

            Diluted                                     $0.75      $0.32


    Weighted average common shares outstanding:

            Basic                                      58,506     59,052

            Diluted                                    59,713     61,118




                           NU SKIN ENTERPRISES, INC.

                 Consolidated Statements of Income (Unaudited)

             For the Six-Month Periods Ended June 30, 2015 and 2014

                    (in thousands, except per share amounts)


                                                                 2015       2014
                                                                 ----       ----


    Revenue                                                $1,103,541 $1,321,088


    Cost of sales                                             215,318    262,654
                                                              -------    -------


    Gross profit                                              888,223  1,058,434
                                                              -------  ---------


    Operating expenses:

            Selling expenses                                  473,454    596,676

            General and administrative
             expenses                                         274,322    305,824
                                                              -------    -------

    Total operating expenses                                  747,776    902,500
                                                              -------    -------


    Operating income                                          140,447    155,934


    Other income (expense), net                              (15,026)  (38,627)
                                                              -------    -------

    Income before provision for
     income taxes                                             125,421    117,307

    Provision for income taxes                                 44,482     42,946
                                                               ------     ------


    Net income                                                $80,939    $74,361
                                                              =======    =======


    Net income per share:

            Basic                                               $1.38      $1.26

            Diluted                                             $1.35      $1.22


    Weighted average common shares outstanding:

            Basic                                              58,747     58,961

            Diluted                                            59,994     61,177


                                                 NU SKIN ENTERPRISES, INC.

                                          Consolidated Balance Sheets (Unaudited)

                                                       (in thousands)


                                                 June 30, 2015                    December 31, 2014
                                                 -------------                    -----------------

    ASSETS

    Current assets:

            Cash and cash equivalents                                  $292,414                       $288,415

            Current investments                                          11,518                         11,793

            Accounts receivable                                          43,543                         35,834

            Inventories, net                                            305,027                        338,491

            Prepaid expenses and other                                  155,205                        160,134
                                                                        -------                        -------

                                                                        807,707                        834,667


    Property and equipment, net                                         473,216                        464,783

    Goodwill                                                            112,446                        112,446

    Other intangible assets, net                                         70,900                         75,062

    Other assets                                                        138,351                        127,476
                                                                        -------                        -------

                    Total assets                                     $1,602,620                     $1,614,434
                                                                     ==========                     ==========


    LIABILITIES AND STOCKHOLDERS' EQUITY

    Current liabilities:

            Accounts payable                                            $39,464                        $34,712

            Accrued expenses                                            306,319                        300,847

            Current portion of long-
             term debt                                                   74,966                         82,770
                                                                         ------                         ------

                                                                        420,749                        418,329


    Long-term debt                                                      177,178                        164,567

    Other liabilities                                                   100,808                         89,100
                                                                        -------                         ------

                    Total liabilities                                   698,735                        671,996
                                                                        -------                        -------


    Stockholders' equity:

            Class A common stock                                             91                             91

            Additional paid-in capital                                  418,243                        414,394

           Treasury stock, at cost                                    (933,040)                     (862,608)

            Accumulated other
             comprehensive loss                                        (63,251)                      (51,521)

            Retained earnings                                         1,481,842                      1,442,082
                                                                      ---------                      ---------

                                                                        903,885                        942,438
                                                                        -------                        -------

                    Total liabilities and
                     stockholders' equity                            $1,602,620                     $1,614,434
                                                                     ==========                     ==========

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SOURCE Nu Skin Enterprises, Inc.