EX-99 2 ex99-1.htm EXHIBIT 99.1 ex99-1.htm

 

Exhibit 99.1

 

Company Contact

Investor Contact

Scott Davidson

Brett Maas

Chief Financial Officer

Managing Partner

Natural Health Trends Corp.

Hayden IR

Tel: 972-241-4080

Tel: 646-536-7331

scott.davidson@nthglobal.com

brett@haydenir.com

 

FOR IMMEDIATE RELEASE

 

Natural Health Trends Reports Continued Momentum,

Record First Quarter Financial Results

 

Revenue of $23.2 Million, up 168%; $0.26 in Diluted EPS

Second Dividend is Declared

 

DALLAS, TX, May 7, 2014 -- Natural Health Trends Corp. (OTCQB: NHTC), a leading direct selling company that markets premium quality personal care, wellness and “quality of life” products under the NHT Global brand, today announced record financial results for the quarter ended March 31, 2014.

 

First Quarter Financial Highlights

 

Total revenues were $23.2 million, up 168% compared to $8.7 million in the first quarter last year and up 21% sequentially compared to $19.1 million for the fourth quarter last year. This was the fifth consecutive sequential quarterly increase in revenues.

Operating income was $3.1 million, up 968% compared to $292,000 last year, and up 88% sequentially from $1.7 million for the fourth quarter last year.
Net income was $3.1 million, or $0.26 per diluted share, compared to $283,000, or $0.03 per diluted share, last year and $1.6 million, or $0.14 per diluted share, for the fourth quarter last year.
Cash and cash equivalents increased to $23.3 million as of March 31, 2014 from $14.6 million at December 31, 2013.

 

“The strong momentum we built in 2013 continued into the first quarter,” commented Chris Sharng, President of Natural Health Trends Corp. “Net sales in Hong Kong increased 237% and sales in Taiwan increased 12% compared to the first quarter of last year, demonstrating the strong organization we have built in these two important geographies. We continue to expand our gross profitability, grow our operating income and expand our free cash flow, helping to support our prospect for long-term growth.”

 

“Our focus is on sustaining this momentum and continuing to drive improved results,” added Mr. Sharng. “All of the critical business drivers that we built: leader support, promotional plans, training, product development, member services and commissions plan are working effectively. We expect 2014 will be an exceptional year for Natural Health Trends, its members, customers and shareholders.”  

 

 
 

 

 

Dividend

 

Yesterday the Board of Directors declared its second consecutive quarterly dividend. The declared dividend included a cash dividend of $0.0196 per share on outstanding Series A preferred stock, which represents the accrued unpaid dividends through the declaration date, and a cash dividend of $0.005 per share on common stock outstanding, totaling aggregate dividends of $60,000, payable in cash on June 4, 2014 to stockholders of record on May 27, 2014.

 

Shareholder Conference Call

 

Management will conduct a conference call to discuss its first quarter financial results. Details of the call are as follows:

 

 

Date: Wednesday, May 7, 2014

 

Time: 4:30 p.m. ET/3:30 p.m. CT

 

Dial-in number: 1-877-941-1428 (domestic) 1-480-629-9665 (international)

 

Webcast link: http://public.viavid.com/index.php?id=108979  

 

A replay will be available from 7:30 p.m. ET on May 7 through 11:59 p.m. ET on May 14, by dialing 1-877-870-5176 (domestic) and 1-858-384-5517 (international) and referencing replay pin number 4681425.

 

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, wellness and “quality of life” products under the NHT Global brand. Additional information can be found on the company's website, www.naturalhealthtrendscorp.com.

 

Forward Looking Statement

 

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 7, 2014, 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.

 

-- Tables follow --

 

 
 

 

 

NATURAL HEALTH TRENDS CORP.

 

CONSOLIDATED BALANCE SHEETS

(In Thousands, Except Share Data)

 

   

December 31, 2013

   

March 31, 2014

 
           

(Unaudited)

 

ASSETS

               

Current assets:

               

Cash and cash equivalents

  $ 14,550     $ 23,334  

Accounts receivable

    134       168  

Inventories, net

    1,828       3,323  

Other current assets

    658       1,742  

Total current assets

    17,170       28,567  

Property and equipment, net

    265       294  

Goodwill

    1,764       1,764  

Restricted cash

    328       323  

Other assets

    300       296  

Total assets

  $ 19,827     $ 31,244  
                 

LIABILITIES AND STOCKHOLDERS’ EQUITY

               
                 

Current liabilities:

               

Accounts payable

  $ 3,058     $ 4,438  

Income taxes payable

    25       53  

Accrued distributor commissions

    3,962       3,957  

Other accrued expenses

    3,146       4,321  

Deferred revenue

    2,569       7,881  

Deferred tax liability

    108       108  

Other current liabilities

    882       923  

Total current liabilities

    13,750       21,681  

Commitments and contingencies

               

Stockholders’ equity:

               

Preferred stock

    111       93  

Common stock

    11       12  

Additional paid-in capital

    80,655       81,272  

Accumulated deficit

    (74,619 )     (71,706 )

Accumulated other comprehensive loss:

               

Foreign currency translation adjustments

    (81 )     (108 )

Total stockholders’ equity

    6,077       9,563  

Total liabilities and stockholders’ equity

  $ 19,827     $ 31,244  

 

 
 

 

  

NATURAL HEALTH TRENDS CORP.

 

CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)

(In Thousands, Except Per Share Data)

 

   

Three Months Ended March 31,

 
   

2013

   

2014

 
                 

Net sales

  $ 8,651     $ 23,162  

Cost of sales

    2,228       5,252  

Gross profit

    6,423       17,910  

Operating expenses:

               

Distributor commissions

    3,674       10,423  

Selling, general and administrative expenses

    2,445       4,347  

Depreciation and amortization

    12       21  

Total operating expenses

    6,131       14,791  

Income from operations

    292       3,119  

Other income (expense), net

    7       (9 )

Income before income taxes

    299       3,110  

Income tax provision

    12       39  

Net income

    287       3,071  

Preferred stock dividends

    (4 )     (4 )

Net income available to common stockholders

  $ 283     $ 3,067  
                 

Income per common share:

               

Basic

  $ 0.03     $ 0.27  

Diluted

  $ 0.03     $ 0.26  
                 

Weighted-average number of common shares outstanding:

               

Basic

    11,069       11,361  

Diluted

    11,248       11,673  
                 

Cash dividends declared per share:

               
Common   $     $ 0.005  
Series A preferred stock   $     $ 0.815  

  

 
 

 

  

NATURAL HEALTH TRENDS CORP.

 

CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)

(In Thousands)

 

   

Three Months Ended March 31,

 
   

2013

   

2014

 
                 

CASH FLOWS FROM OPERATING ACTIVITIES:

               

Net income

  $ 287     $ 3,071  

Adjustments to reconcile net income to net cash provided by operating activities:

               

Depreciation and amortization

    12       21  

Stock-based compensation

    30       25  

Changes in assets and liabilities:

               

Accounts receivable

    (59 )     (39 )

Inventories, net

    (28 )     (1,527 )

Other current assets

    232       (1,105 )

Other assets

    (2 )      

Accounts payable

    428       1,381  

Income taxes payable

    12       28  

Accrued distributor commissions

    215       21  

Other accrued expenses

    (279 )     1,040  

Deferred revenue

    304       5,320  

Other current liabilities

    (134 )     47  

Net cash provided by operating activities

    1,018       8,283  
                 

CASH FLOWS FROM INVESTING ACTIVITIES:

               

Purchases of property and equipment, net

    (14 )     (63 )

Net cash used in investing activities

    (14 )     (63 )
                 

CASH FLOWS FROM FINANCING ACTIVITIES

               

Proceeds from exercise of warrants

          598  

Repurchase of common stock

    (12 )     (24 )

Net cash provided by (used in) financing activities

    (12 )     574  
                 

Effect of exchange rates on cash and cash equivalents

    (26 )     (10 )

Net increase in cash and cash equivalents

    966       8,784  

CASH AND CASH EQUIVALENTS, beginning of period

    4,207       14,550  

CASH AND CASH EQUIVALENTS, end of period

  $ 5,173     $ 23,334  
                 

NON-CASH FINANCING ACTIVITY:

               

Conversion of preferred stock

  $     $ 18  

Cash dividends declared, but not yet paid

          158  

 

###