Sales slide at Nature's Sunshine
several international markets, but still sees light at the end of
the tunnel.
In stark contrast to the positive quarterly figures from NBTY we reported yesterday, US supplement manufacturer and marketer Nature's Sunshine has reported a 5 per cent decline in sales for the second quarter of the fiscal year, a clear reminder that the difficult market conditions are still taking their toll.
Sales for the quarter ended 30 June were $77.9 million (€787.6m) compared to $81.8 million for the same period in the prior year. Net income was also lower, falling from $4.7 million in 2001 to $3.0 million this year.
Not surprisingly, the figures for the first six months of the year were also in decline, with revenues of $153.8 million compared to $163.5 million, a 6 per cent fall, and net income of $2.1 million down sharply from $8.7 million a year earlier.
Most of the decline in sales came from international markets, where quarterly revenues were totaled $32.6 million compared to $36.2 million. Domestic sales fell by less than 1 per cent from $45.6 million to $45.3 million. For the first half of the year, the international decline was 10 per cent, from $71.8 million to $64.3 million, while in the US, sales were some 2 per cent lower at $89.5 million compared to $91.7 million.
The decreases in international sales were primarily the result of decreases reported in South Korea, Brazil and Venezuela. However, Nature's Sunshine said that there was positive news from sales to the Hispanic market in the US, where revenues grew by an impressive 15 per cent compared to the second quarter a year earlier.
"Despite the unfavourable operating results reported during the quarter, we are optimistic about the prospects of certain new programmes implemented in recent months, primarily the introduction of our latest product, BodyGem, a personal handheld tracking device designed to monitor resting metabolic burn rate," said Daniel P. Howells, president and CEO.
"Although several key markets lost momentum during the quarter, other markets made notable improvements in profitability. Our emphasis continues to be on increasing sales revenue, reducing costs, introducing new products and enhancing our marketing efforts. We anticipate holding one of the company's largest conventions in September in Nashville, Tennessee. Consequently, with a high degree of liquidity and a strong financial position, we remain confident regarding the outlook for our company."
Nature's Sunshine currently has around 555,000 worldwide distributors, a 4 per cent drop compared to the same period last year. It has operations in South Korea, Brazil, Mexico, Venezuela, Japan, Canada, Colombia, the UK, Ireland, Peru, Chile, Central America, Ecuador, Israel and Singapore, as well as its core US business. It also has exclusive distribution agreements with selected companies in Argentina, Australia, New Zealand, Malaysia, Norway and the Russian Federation.
