Natural Health Trends Announces First Quarter 2009 Results
DALLAS, TX -- (MARKET WIRE) -- 05/14/09 -- Natural Health Trends Corp. (NASDAQ: BHIP) today announced its financial results for the quarter ended March 31, 2009. The company reported sales of $9.9 million and an operating loss of $808,000 for the quarter.
Chris Sharng, president of Natural Health Trends, said, "In the past year, we have brought costs down significantly and focused on members' productivity in fewer core markets. From the cash flow statement, we can tell that our operational ability to preserve cash in a traditionally lighter-volume quarter has greatly improved year over year. Meanwhile, a number of new products were successfully launched. Along with the progress we have made in resolving legacy legal issues, our strategies are taking some time but are paying off. We believe that we are on track to position Natural Health Trends to grow in markets that we targeted as having incredible potentials."
The company plans to host a conference call at 11:30 a.m. EDT, May 15, 2009. Those who wish to participate may call telephone number (866) 672-2663, or (973) 582-2772 for international callers, 15 minutes before 11:30 a.m. EDT. Callers will need to give the conference identification number, 10178044. If you cannot participate in the call, but wish to hear it, you may log in to the company's homepage at www.naturalhealthtrendscorp.com and click on the conference call 1 1/2 hours after the completion of the call.
About Natural Health Trends Corp.
Natural Health Trends Corp. is an international direct-selling and e-commerce company operating through its subsidiaries throughout Asia, North America, 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, and management encourages interested parties to register for updated corporate information via email on the company's home page, www.naturalhealthtrendscorp.com.
Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995 -- Forward-looking statements in this release do not constitute guarantees of future performance. Such forward-looking statements are subject to risks and uncertainties that could cause our actual results to differ materially from those anticipated. Such risks and uncertainties include the risks and uncertainties detailed under the caption "Risk Factors" in our Annual Report on Form 10-K filed on March 23, 2009, with the Securities and Exchange Commission. We assume 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)
December March
31, 2008 31, 2009
----------- -----------
(Unaudited)
ASSETS
Current assets:
Cash and cash equivalents $ 3,491 $ 2,636
Restricted cash 340 390
Accounts receivable 71 102
Inventories, net 2,141 2,057
Other current assets 735 792
----------- -----------
Total current assets 6,778 5,977
Property and equipment, net 1,173 1,096
Goodwill 1,764 1,764
Intangible assets, net 1,800 1,600
Restricted cash 3,646 3,268
Other assets 1,464 1,169
----------- -----------
Total assets $ 16,625 $ 14,874
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LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable $ 1,746 $ 2,722
Income taxes payable 187 281
Accrued distributor commissions 554 903
Other accrued expenses 2,456 2,837
Deferred revenue 2,841 1,098
Current portion of convertible debentures,
net of discount of $2,320 and $1,677 at
December 31, 2008 and March 31, 2009,
respectively 1,534 1,687
Deferred tax liability 351 351
Other current liabilities 1,170 1,062
----------- -----------
Total liabilities 10,839 10,941
Commitments and contingencies
Stockholders’ equity:
Preferred stock, $0.001 par value; 5,000,000
shares authorized; 1,761,900 shares
designated Series A convertible preferred
stock, 138,400 shares issued and outstanding
at December 31, 2008 and March 31, 2009,
aggregate liquidation value of $267 124 124
Common stock, $0.001 par value; 50,000,000
shares authorized; 10,691,582 and 10,728,714
shares issued and outstanding at December
31, 2008 and March 31, 2009, respectively 11 11
Additional paid-in capital 79,711 79,822
Accumulated deficit (74,853) (76,597)
Accumulated other comprehensive income:
Foreign currency translation adjustments 759 562
----------- -----------
Total Natural Health Trends stockholders’ equity 5,752 3,922
Noncontrolling interest 34 11
----------- -----------
Total stockholders’ equity 5,786 3,933
----------- -----------
Total liabilities and stockholders’ equity $ 16,625 $ 14,874
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NATURAL HEALTH TRENDS CORP.
CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)
(In Thousands, Except Per Share Data)
Three Months Ended March 31,
----------------------------
2008 2009
------------- -------------
Net sales $ 11,395 $ 9,869
Cost of sales 3,090 2,797
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Gross profit 8,305 7,072
Operating expenses:
Distributor commissions 3,997 3,779
Selling, general and administrative
expenses (including stock-based
compensation expense of $164 and
$111 during 2008 and 2009, respectively) 4,596 3,771
Depreciation and amortization 386 330
Impairment of long-lived assets 24 -
------------- -------------
Total operating expenses 9,003 7,880
------------- -------------
Loss from operations (698) (808)
Other income (expense), net:
Gain (loss) on foreign exchange 371 (2)
Interest income 35 14
Interest expense (including amortization
of debt issuance costs and accretion of
debt discount of $362 and $775 during
2008 and 2009, respectively (387) (866)
Other 8 11
------------- -------------
Total other income (expense), net 27 (843)
------------- -------------
Loss before income taxes (671) (1,651)
Income tax provision (37) (114)
------------- -------------
Net loss (708) (1,765)
Plus: Net loss attributable to the
noncontrolling interest - 21
------------- -------------
Net loss attributable to Natural Health
Trends $ (708) $ (1,744)
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NATURAL HEALTH TRENDS CORP.
CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)
(In Thousands)
Three Months Ended March 31,
----------------------------
2008 2009
------------- -------------
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss $ (708) $ (1,765)
Adjustments to reconcile net loss to net cash
used in operating activities:
Depreciation and amortization of property
and equipment 186 130
Amortization of intangibles 200 200
Amortization of debt issuance costs 62 132
Accretion of debt discount 300 643
Stock-based compensation 164 111
Impairment of long-lived assets 24 -
Changes in assets and liabilities:
Accounts receivable 50 (34)
Inventories, net 781 31
Other current assets (399) (61)
Other assets 59 96
Accounts payable (293) 977
Income taxes payable 18 114
Accrued distributor commissions (374) 362
Other accrued expenses (389) 396
Deferred revenue (938) (1,723)
Other current liabilities (127) (95)
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Net cash used in operating activities (1,384) (486)
------------- -------------
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of property and equipment (6) (58)
Decrease in restricted cash 93 266
------------- -------------
Net cash provided by investing activities 87 208
------------- -------------
CASH FLOWS FROM FINANCING ACTIVITIES
Payments on debt - (490)
------------- -------------
Net cash used in financing activities - (490)
------------- -------------
Effect of exchange rates on cash and cash
equivalents (328) (87)
------------- -------------
Net decrease in cash and cash equivalents (1,625) (855)
CASH AND CASH EQUIVALENTS, beginning of
period 6,282 3,491
------------- -------------
CASH AND CASH EQUIVALENTS, end of period $ 4,657 $ 2,636
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Contact: Jean Bono Natural Health Trends Corp. Email Contact
Released May 14, 2009