Nature's Sunshine Reports Fourth Quarter and Full Year 2024 Financial Results

About this update from Nature's Sunshine Products, Inc.

LEHI, Utah, March 11, 2025 (GLOBE NEWSWIRE) -- Nature’s Sunshine Products, Inc. (Nasdaq: NATR) (“Nature’s Sunshine” and/or the “Company”), a leading manufacturer of high-quality herbal and nutritional supplements, reported financial results for the fourth quarter and full year ended December 31, 2024. Fourth Quarter 2024 Financial Summary vs. Same Year-Ago Quarter Full Year 2024 Financial Summary vs. 2023 Management Commentary “The fourth quarter was one of our strongest quarters ever, with revenue of $118 million, reflecting growth of 8.5% year-over-year and 10% on a constant currency basis,” said Terrence Moorehead, CEO of Nature’s Sunshine. ”Our 21% growth in Asia Pacific and the continued execution of our strategies in Europe were key drivers of success. We are also encouraged by the 17% increase in North America digital sales which demonstrates the continued strength of our digital platform. “As we move into 2025, we reiterate our commitment to delivering the highest quality, innovative products to our customers and to empowering our distributor base to drive continued growth and profitability. Combining that with our cost-savings initiatives and operational efficiencies, which are already making a positive impact, will enable us to continue making strong progress against our strategic initiatives while delivering long-term, sustainable shareholder value in the face of increased macroeconomic uncertainty.” Fourth Quarter 2024 Financial Results Net sales in the fourth quarter of 2024 increased 8.5% to $118.2 million compared to $108.9 million in the year-ago quarter. Excluding the impact from foreign exchange rates, net sales in the fourth quarter of 2024 increased 10.0% compared to the year-ago quarter. Gross margin in the fourth quarter increased to 72.0% compared to 71.9% in the year-ago quarter due to cost saving initiatives. Volume incentives as a percentage of net sales increased to 31.1% compared to 30.1% in the year-ago quarter, due to changes in market mix. Selling, general and administrative expenses (“SG&A”) in the fourth quarter were $43.7 million compared to $39.9 million in the year-ago quarter. The increase was primarily driven by variable costs related to sales growth, partially offset by decreases in compensation. As a percentage of net sales, SG&A expenses increased to 37.0% in the fourth quarter of 2024 compared to 36.6% in the year-ago quarter. Operating income in the fourth quarter was $4.6 million, or 3.8% of net sales, compared to $5.7 million, or 5.2% of net sales, in the year-ago quarter. Other income (loss), net, in the fourth quarter of 2024 was $(3.1) million compared to $2.0 million in the year-ago quarter. Other income (loss), net, primarily consisted of foreign exchange losses as a result of net changes in foreign currencies in Asia, Europe and Latin America. The provision for income taxes was $2.2 million in the fourth quarter of 2024 compared to a benefit of $1.7 million in the year-ago quarter. GAAP net income (loss) attributable to common shareholders was $(0.3) million, or $(0.02) per diluted common share, compared to net income of $9.0 million, or $0.46 per diluted common share, in the year-ago quarter. Net income (loss) attributable to NSP China was $(2.1) million, or $(0.11) per diluted common share, for the fourth quarter of 2024, compared to net income of $1.9 million, or $0.10 per diluted common share, in the prior year quarter. Non-GAAP net income attributable to common shareholders was $0.0 million, or $0.00 per diluted common share, compared to $8.9 million, or $0.45 per diluted common share, in the year-ago quarter. Adjusted net income, which is a non-GAAP financial measure, is defined here as net income from continuing operations before less-frequent items including, among other things, restructuring expenses and certain tax refunds. A reconciliation of adjusted net income to GAAP net income is provided in the financial tables below. Adjusted EBITDA in the fourth quarter increased to $10.3 million compared to $9.7 million in the prior year quarter. Adjusted EBITDA, which is a non-GAAP financial measure, is defined here as net income from continuing operations before taxes, depreciation, amortization, and other income (loss) adjusted to exclude share-based compensation expense and certain noted adjustments. A reconciliation of net income (loss) to Adjusted EBITDA is provided in the attached financial tables. Full Year 2024 Financial Results Net sales in 2024 increased 2.0% to $454.4 million compared to $445.3 million in 2023. Excluding unfavorable foreign exchange rates, net sales in 2024 increased 3.8% compared to the prior year. Gross margin in 2024 decreased to 71.5% compared to 72.1% in 2023. Inflationary pressures and unfavorable foreign currency exchange contributed to the decline. Volume incentives as a percentage of net sales in 2024 were 30.9% compared to 30.4% in 2023. The slight increase was due to changes in market mix. SG&A in 2024 were $164.0 million compared to $167.1 million in 2023. The decrease was primarily related to the streamlining of global overhead expenses and reduced service fees due to China’s lower net sales. As a percentage of net sales, SG&A expenses were 36.1% in 2024 compared to 37.5% in 2023. Operating income in 2024 was $20.1 million, or 4.5% of net sales, compared to $18.7 million, or 4.2% of net sales, in 2023. Other income (loss), net, in 2024 was $(1.7) million compared to income of $1.5 million in 2023. Other income (loss), net, primarily consisted of foreign exchange losses as a result of net changes in foreign currencies, in Europe and Latin America, which were largely offset by gains in Asia. The provision for income taxes was $10.5 million in 2024 compared to $3.8 million in 2023. GAAP net income attributable to common shareholders was $7.7 million, or $0.40 per diluted common share, compared to $15.1 million, or $0.77 per diluted common share, in 2023. Net income attributable to NSP China decreased to $1.0 million, or $0.05 per diluted common share, for 2024, compared to $6.7 million, or $0.34 per diluted common share, in the prior year. Non-GAAP net income attributable to common shareholders in 2024 was $8.9 million, or $0.46 per diluted common share, compared to $18.6 million, or $0.95 per diluted common share, in 2023. Adjusted net income, which is a non-GAAP financial measure, is defined here as net income from continuing operations before less-frequent items including, among other things, restructuring expenses and certain tax refunds. A reconciliation of non-GAAP net income to GAAP net income is provided in the attached financial tables. Adjusted EBITDA in 2024 increased to $40.5 million compared to $40.4 million in 2023. The increase was driven primarily by the aforementioned increase in operating income. Adjusted EBITDA, which is a non-GAAP financial measure, is defined here as net income from continuing operations before taxes, depreciation, amortization, and other income (loss) adjusted to exclude share-based compensation expense and certain noted adjustments. A reconciliation of net income to Adjusted EBITDA is provided in the attached financial tables. Balance Sheet and Cash Flow Net cash provided by operating activities was $25.3 million for the year ended December 31, 2024, compared to $41.2 million in the prior year. Capital expenditures during the twelve months ended December 31, 2024, totaled $11.0 million compared to $10.5 million in 2023. During the twelve months ended December 31, 2024, the Company repurchased 540,000 shares at a total cost of $8.9 million, or $16.42 per share. As of December 31, 2024, the Company had cash and cash equivalents of $84.7 million and no outstanding debt. Outlook The Company expects full year 2025 net sales to range between $445 - $470 million and expects adjusted EBITDA to range between $38 - $44 million. Conference Call The Company will hold a conference call today at 5:00 p.m. Eastern time to discuss its fourth quarter and full year 2024 results. Date: Tuesday, March 11th, 2025 Time: 5:00 p.m. Eastern time (3:00 p.m. Mountain time) Toll-free dial-in number: 1-800-717-1738 International dial-in number: 1-646-307-1865 Conference ID: 73865 Please call the conference telephone number 5-10 minutes prior to the start time. An operator will register your name and organization. If you have any difficulty connecting with the conference call, please contact Gateway Group at 1-949-574-3860. The conference call will be broadcast live and available for replay here and via the Events section of the Nature’s Sunshine website here . A replay of the conference call will be available after 8:00 p.m. Eastern time on the same day through Tuesday, March 25, 2025. Toll-free replay number: 1-844-512-2921 International replay number: 1-412-317-6671 Replay ID: 1173865 About Nature’s Sunshine Products Nature’s Sunshine Products (Nasdaq: NATR), a leading natural health and wellness company, markets and distributes nutritional and personal care products in more than 40 countries. Nature’s Sunshine manufactures most of its products through its own state-of-the-art facilities to ensure its products continue to set the standard for the highest quality, safety, and efficacy on the market today. Additional information about the Company can be obtained at its website, www.naturessunshine.com. CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS This press release contains forward-looking statements regarding the Company’s future business expectations, which are subject to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements may include, but are not limited to, statements relating to the Company’s objectives, plans, strategies and financial results, including outlook for 2025 net sales and adjusted EBITDA. All statements (other than statements of historical fact) that address activities, events or developments that the Company intends, expects, projects, believes or anticipates will or may occur in the future are forward-looking statements. These statements are often characterized by terminology such as “believe,” “hope,” “may,” “anticipate,” “should,” “intend,” “plan,” “will,” “expect,” “estimate,” “project,” “positioned,” “strategy” and similar expressions, and are based on assumptions and assessments made by management in light of their experience and their perception of historical trends, current conditions, expected future developments and other factors they believe to be appropriate. Forward-looking statements are not guarantees of future performance and are subject to risks and uncertainties, including the following: These and other risks and uncertainties that could cause actual results to differ from predicted results are more fully detailed under the caption “Risk Factors” in our reports filed with the Securities and Exchange Commission, including our Annual Report on Form 10-K and Quarterly Reports filed on Form 10-Q. All forward-looking statements speak only as of the date of this press release and are expressly qualified in their entirety by the cautionary statements included in or incorporated by reference into this press release. Except as is required by law, the Company expressly disclaims any obligation to publicly release any revisions to forward-looking statements to reflect events after the date of this press release. Non-GAAP Financial Measures We have included information which has not been prepared in accordance with generally accepted accounting principles (GAAP), such as information concerning non-GAAP net income, adjusted EBITDA and net sales excluding the impact of foreign currency exchange fluctuations. We utilize the non-GAAP measures of non-GAAP net income and adjusted EBITDA in the evaluation of our operations and believe that these measures are useful indicators of our ability to fund our business. These non-GAAP financial measures should not be considered as an alternative to, or more meaningful than, U.S. GAAP net income (loss) as an indicator of our operating performance. Other companies may use the same or similarly named measures, but exclude different items, which may not provide investors with a comparable view of Nature’s Sunshine Products’ performance in relation to other companies. We have included a reconciliation of net income to adjusted EBITDA, the most comparable GAAP measure. We have also included a reconciliation of GAAP net income to non-GAAP net income and non-GAAP adjusted EPS, in the attached financial tables. Net sales in local currency removes, from net sales in U.S. dollars, the impact of changes in exchange rates between the U.S. dollar and the functional currencies of our foreign subsidiaries. This is accomplished by translating the current period net sales into U.S. dollars using the same foreign currency exchange rates that were used to translate the net sales for the previous comparable period. We believe presenting the impact of foreign currency fluctuations is useful to investors because it allows a more meaningful comparison of net sales of our foreign operations from period to period. Net sales excluding the impact of foreign currency fluctuations should not be considered in isolation or as an alternative to net sales in U.S. dollar measures that reflect current period exchange rates, or to other financial measures calculated and presented in accordance with U.S. GAAP. With respect to our Adjusted EBITDA outlook for the full year 2024, a quantitative reconciliation to the corresponding GAAP information cannot be provided without unreasonable effort because of the inherent difficulty of accurately forecasting the occurrence and financial impact of the various adjusting items necessary for such reconciliation that have not yet occurred, are out of our control, or cannot be reasonably predicted, including but not limited to warrant liabilities and stock based compensation. For the same reasons, we are unable to assess the probable significance of the unavailable information, which could have a material impact on our future GAAP financial results. Investor Relations: Gateway Group Cody Slach 1-949-574-3860 [email protected] * Other (income) loss, net is primarily comprised of foreign exchange (gains) losses, interest income, and interest expense.

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