Nu Skin Enterprises Reports First-Quarter 2017 Results

PROVO, Utah, May 3, 2017 /PRNewswire/ — Nu Skin Enterprises, Inc. (NYSE: NUS) today announced first-quarter 2017 financial results.

Key Highlights

Revenue:	$499.1 million, a 6% improvement over Q1 2016; negatively impacted 1% by foreign currency fluctuations
Earnings Per Share (EPS):	$0.51, compared to $0.06 in Q1 2016 which included a $0.36 non-cash Japan customs charge
Sales Leaders:	54,600, a 1% year-over-year decrease
Customers:	980,000, a 2% year-over-year improvement

“We are pleased to deliver strong first-quarter results, which demonstrates the progress we made executing on our strategic priorities to increase customer trial and acquisition,” said Ritch Wood, chief executive officer. “Our quarterly results reflect solid growth in Mainland China, South Asia/Pacific and EMEA. Our expanding social selling efforts and the continued rollout of ageLOC Me and ageLOC Youth contributed to our strong revenue during the quarter, positioning us to deliver solid performance for 2017.”

Q1 2017 Operating Results

Revenue:	$499.1 million, a 7% constant currency improvement
Gross margin:	77.7% compared to 70.8% in Q1 2016, or 77.4% when excluding the Q1 2016 Japan customs charge
Selling Expenses:	41.9% of revenue compared to 41.5% in Q1 2016
G&A Expenses:	26.6% of revenue compared to 27.6% in Q1 2016
Operating Margin:	9.3% compared to 1.7% in Q1 2016, or 8.4% when excluding the Japan customs charge
Other Income / (Expense):	($4.6) million, compared to ($2.9) million in Q1 2016; the change is primarily interest expense
Income Tax Rate:	34.1% compared to 37.3% in Q1 2016; benefitted from a new stock compensation accounting standard
EPS:	$0.51, a 21% increase compared to Q1 2016, when excluding the Japan customs charge

Stockholder Value

Dividend Payments:	$19.0 million
Stock Repurchases:	$6.8 million; $192.9 million remaining in authorization

2017 Outlook

Q2 Revenue:	$530 to $550 million; negative foreign currency impact of 1 to 2%; prior year included $106 million in LTO revenue
Q2 EPS:	$0.65 to $0.70
2017 Revenue:	$2.26 to $2.30 billion; negative foreign currency impact of approximately 2 to 3%
2017 EPS	$3.10 to $3.25

“Looking forward, we will continue to focus on accelerating growth, driving innovation throughout our business, and empowering our customers and sales leaders with the products, programs, and platforms they need to succeed in a rapidly-evolving marketplace,” said Wood. “A key component of our strategy is capitalizing on our early social selling success by expanding our reach through online channels globally. As part of this effort, we are making our product portfolio and business opportunity more accessible and attractive, particularly to the important millennial segment. We are confident that as we continue to execute on our initiatives, we will reach our 2017 business targets and will be well positioned for long-term growth and shareholder value creation.”

“Our financial results in the first quarter put us on track to achieve our previously announced annual guidance,” said Mark Lawrence, chief financial officer. “As we discussed at our investor day, we had significant limited-time-offers (LTOs) of $106 and $56 million in the second and third quarters of 2016. In the fourth quarter, we will begin a significant product introduction of our new ageLOC LumiSpa skin renewal and deep-cleansing device, which we anticipate will generate approximately $100 million in sales. These LTOs and product introductions will significantly impact our comparable sales and guidance for the balance of the year. We reiterate our 2017 forecast of $2.26 to $2.30 billion in revenue, and earnings per share of $3.10 to $3.25. We project second-quarter revenue of $530 to $550 million and earnings per share of $0.65 to $0.70,” concluded Lawrence.

Conference Call

The Nu Skin management team will host a conference call with the investment community on May 3, at 5 p.m. (ET). 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 May 19, 2017.