• Natural Health Trends Reports First Quarter 2024 Financial Results

    Source: Nasdaq GlobeNewswire / 01 May 2024 08:00:00   America/Chicago

    • For the first time in six years, first quarter orders exceeded the preceding fourth quarter's, up 11%. Compared to a year ago, orders were up 1%.
    • Reported positive cash flows from operations during the quarter, first time in five quarters
    • Declared a quarterly cash dividend of $0.20 per share

    HONG KONG, May 01, 2024 (GLOBE NEWSWIRE) -- Natural Health Trends Corp. (NASDAQ: NHTC), a leading direct-selling and e-commerce company that markets premium quality personal care, wellness and “quality of life” products under the NHT Global brand, today announced its financial results for the quarter ended March 31, 2024.

    First Quarter 2024 Financial Highlights

    • Revenue of $11.0 million decreased 8% compared to $11.9 million in the first quarter of 2023. The decrease was entirely due to changes in the differences in deferred revenue between the two periods. Deferred revenue increased $1.0 million in the first quarter this year and remained flat in the comparable period last year.
    • Operating loss was $365,000 compared to $394,000 in the first quarter of 2023.
    • Net income was $188,000, or $0.02 per diluted share, compared to $257,000, or $0.02 per diluted share, in the first quarter of 2023.
    • The number of Active Members1 was down 2% to 31,620 at March 31, 2024 compared to 32,410 at December 31, 2023, and decreased 18% compared to 38,330 at March 31, 2023.

    1 Natural Health Trends defines Active Members as those that have placed at least one product order with the Company during the preceding twelve-month period.

    Management Commentary

    “Our financial results reflect a $1.0 million increase in deferred revenue which resulted in a revenue decrease when compared to the same period last year. We anticipate the gradual recognition of this deferred revenue in the coming months as we fulfill orders to our customers. Worth highlighting is that this period marks the first time in six years we accomplished a sequential increase in orders taken during the first quarter. Additionally, we achieved positive cash flows from operations, underscoring the underlying strength of our business model and strong balance sheet,” commented Chris Sharng, President of Natural Health Trends Corp.

    Mr. Sharng continued, “While guardedly optimistic about the start to the Year of the Dragon, we think these results are indicative of the effectiveness of our current programs. We continue to focus on innovation, customer satisfaction, supporting our leaders and their development, and improving operational efficiency as we navigate our forward progress.”

    Balance Sheet and Cash Flow

    • Net cash provided by operating activities was $549,000 in the first three months of 2024 compared to net cash used in operating activities of $696,000 in the first three months of 2023.
    • Total cash, cash equivalents and marketable securities were $54.4 million at March 31, 2024, down from $56.2 million at December 31, 2023.
    • On April 29, 2024, the Company’s Board of Directors declared a quarterly cash dividend of $0.20 on each share of common stock outstanding. The dividend will be payable on May 24, 2024 to stockholders of record as of May 14, 2024.

    First Quarter 2024 Financial Results Conference Call

    Management will host a conference call to discuss the first quarter 2024 financial results today, Wednesday, May 1, 2024 at 11:30 a.m. Eastern Time. The conference call details are as follows:

    Date:Wednesday, May 1, 2024
    Time:11:30 a.m. Eastern Time / 8:30 a.m. Pacific Time
    Dial-in:1-877-407-0789 (Domestic)
    1-201-689-8562 (International)
    Conference ID:13745331
    Webcast:https://viavid.webcasts.com/starthere.jsp?ei=1662841&tp_key=a0bd3854bf
      

    For those unable to participate during the live broadcast, a replay of the call will also be available from 2:30 p.m. Eastern Time on May 1, 2024 through 11:59 p.m. Eastern Time on May 8, 2024 by dialing 1-844-512-2921 (domestic) and 1-412-317-6671 (international) and referencing the replay pin number: 13745331.

    About Natural Health Trends Corp.

    Natural Health Trends Corp. (NASDAQ: NHTC) is an international direct-selling and e-commerce company operating through its subsidiaries throughout Asia, the Americas, and Europe. The Company markets premium quality personal care products under the NHT Global brand. Additional information can be found on the Company’s website at www.naturalhealthtrendscorp.com.

    Forward-Looking Statements

    Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995 -- Forward-looking statements in this press release do not constitute guarantees of future performance. Such forward-looking statements are subject to risks and uncertainties that could cause the Company’s actual results to differ materially from those anticipated. Such risks and uncertainties include the risks and uncertainties detailed under the caption “Risk Factors” in Natural Health Trends Corp.’s Annual Report on Form 10-K filed on February 28, 2024 with the Securities and Exchange Commission (SEC), as well as in subsequent reports filed this year with the SEC. The Company assumes no obligation to update any forward-looking information contained in this press release or with respect to the announcements described herein.

     
    NATURAL HEALTH TRENDS CORP.
    CONSOLIDATED BALANCE SHEETS
    (In thousands, except share data) 
     
      March 31, 2024  December 31, 2023 
      (Unaudited)     
    ASSETS        
    Current assets:        
    Cash and cash equivalents $25,825  $56,178 
    Marketable securities  28,608   — 
    Inventories  4,899   4,293 
    Other current assets  3,401   3,758 
    Total current assets  62,733   64,229 
    Property and equipment, net  241   266 
    Operating lease right-of-use assets  3,272   3,319 
    Restricted cash  37   39 
    Deferred tax asset  397   369 
    Other assets  959   869 
    Total assets $67,639  $69,091 
    LIABILITIES AND STOCKHOLDERS’ EQUITY        
    Current liabilities:        
    Accounts payable $749  $990 
    Income taxes payable  3,758   3,716 
    Accrued commissions  2,262   2,067 
    Other accrued expenses  1,357   1,170 
    Deferred revenue  7,174   6,166 
    Amounts held in eWallets  3,727   3,945 
    Operating lease liabilities  1,199   1,146 
    Other current liabilities  636   784 
    Total current liabilities  20,862   19,984 
    Income taxes payable  5,054   5,054 
    Deferred tax liability  134   135 
    Operating lease liabilities  2,219   2,318 
    Total liabilities  28,269   27,491 
    Stockholders’ equity:        
    Preferred stock  —   — 
    Common stock  13   13 
    Additional paid-in capital  84,732   84,695 
    Accumulated deficit  (19,818)  (17,703)
    Accumulated other comprehensive loss  (1,221)  (1,069)
    Treasury stock, at cost  (24,336)  (24,336)
    Total stockholders’ equity  39,370   41,600 
    Total liabilities and stockholders’ equity $67,639  $69,091 


     
    NATURAL HEALTH TRENDS CORP. 
    CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)
    (In thousands, except per share data)
     
      Three Months Ended March 31, 
      2024  2023 
    Net sales $10,951  $11,861 
    Cost of sales  2,912   3,031 
    Gross profit  8,039   8,830 
    Operating expenses:        
    Commissions expense  4,486   4,992 
    Selling, general and administrative expenses  3,918   4,232 
    Total operating expenses  8,404   9,224 
    Loss from operations  (365)  (394)
    Other income, net  563   681 
    Income before income taxes  198   287 
    Income tax provision  10   30 
    Net income $188  $257 
    Net income per common share:        
    Basic $0.02  $0.02 
    Diluted $0.02  $0.02 
    Weighted average common shares outstanding:        
    Basic  11,456   11,424 
    Diluted  11,474   11,428 


     
    NATURAL HEALTH TRENDS CORP.
    CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)
    (In thousands)
     
      Three Months Ended March 31, 
      2024  2023 
    CASH FLOWS FROM OPERATING ACTIVITIES:        
    Net income $188  $257 
    Adjustments to reconcile net income to net cash provided by (used in) operating activities:        
    Depreciation and amortization  35   46 
    Share-based compensation  37   46 
    Noncash lease expense  272   280 
    Deferred income taxes  (32)  (57)
    Changes in assets and liabilities:        
    Inventories  (640)  (490)
    Other current assets  189   (78)
    Other assets  (101)  (18)
    Accounts payable  (239)  338 
    Income taxes payable  42   40 
    Accrued commissions  212   (465)
    Other accrued expenses  191   (76)
    Deferred revenue  1,029   43 
    Amounts held in eWallets  (208)  (215)
    Operating lease liabilities  (284)  (301)
    Other current liabilities  (142)  (46)
    Net cash provided by (used in) operating activities  549   (696)
    CASH FLOWS FROM INVESTING ACTIVITIES:        
    Purchases of property and equipment  (11)  (7)
    Purchases of marketable securities  (28,514)  — 
    Net cash used in investing activities  (28,525)  (7)
    CASH FLOWS FROM FINANCING ACTIVITIES:        
    Dividends paid  (2,303)  (2,304)
    Net cash used in financing activities  (2,303)  (2,304)
    Effect of exchange rates on cash, cash equivalents and restricted cash  (76)  (91)
    Net decrease in cash, cash equivalents and restricted cash  (30,355)  (3,098)
    CASH, CASH EQUIVALENTS AND RESTRICTED CASH, beginning of period  56,217   69,746 
    CASH, CASH EQUIVALENTS AND RESTRICTED CASH, end of period $25,862  $66,648 
    SUPPLEMENTAL DISCLOSURE OF NONCASH INVESTING AND FINANCING ACTIVITIES:        
    Right-of-use assets obtained in exchange for operating lease liabilities $251  $(78)
             

    CONTACT:

    Scott Davidson
    Senior Vice President and Chief Financial Officer
    Natural Health Trends Corp.
    Tel (Hong Kong): +852-3107-0800
    Tel (U.S.): 310-541-0888
    investor.relations@nhtglobal.com


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