LifeVantage hit with suits after delay of financials

By Hank Schultz contact

- Last updated on GMT

© iStock / bernie_moto
© iStock / bernie_moto

Related tags: Revenue, Stock

Multilevel marketing company LifeVantage, based in Sandy UT, has been hit with a slew of shareholder lawsuits after saying it had to delay the release of its financial information because of internal accounting flaws.

According to a statement by the company, sales of the company’s products into certain international markets have not been properly accounted for.  The company said it “is currently unable to estimate the impact of the review to net revenue, tax expense, net income or other aspects of its financial statements for the fiscal year ended June 30, 2016 or any potential prior periods. The Audit Committee of the Company's Board of Directors is conducting an independent review of these matters and has retained independent counsel to assist in that review.”  

The statement continued: “The Company will not be in a position to release financial results for the fiscal year ended June 30, 2016 until the independent review by the Audit Committee is completed. The Company is working diligently on this matter and will, as soon as practicable, make a further announcement regarding the updated timing of the release of financial results and a conference call on its financial results.” 

LifeVantage’s signature product is Protandim, a patented blend of extracts of milk thistle, bacopa, ashwagandha, green tea and turmeric.  The initial phase of scientific research into the product and the communication of its benefits focused on the blend’s antioxidant properties.

Shift to MLM model

The company initially sold the product in retail distribution, but it didn’t fit readily into retail supplement categories as they existed back in the early 2000s, and tended to get lost with the thousands of other products on the shelves.  And, with just one product, the company didn’t benefit from broader brand awareness as some companies might with multiple lines.

With sales continually languishing in the $3 million range, a decision was taken in 2009 to switch to a network marketing model​.  The company’s reported results have since skyrocketed, with the company recording $190 million in annual revenue in 2015, according to Direct Selling News. It ranked No. 69 on that magazine’s list of the global top 100 direct selling companies. LifeVantage has in recent years added several products to its mix, including a line of energy drink mixes, a general dietary supplement line and a canine supplement.

The company’s stock price dropped more than 12% on the news of the delayed results.  The stock is now trading $10.04 and had dropped to $9.08 from more than $12 prior to the announcement.  The company’s stock was trading at as much as $15.68 earlier this year.  At least eight shareholders rights lawsuits have now been filed against the company.

Related news

Show more

Related products

show more

KaraHeart™ Showed Results in Just 30 Days

KaraHeart™ Showed Results in Just 30 Days

Karallief® Inc | 30-Jun-2022 | Data Sheet

After extensive R&D, scientists at Karallief® developed KaraHeart™ – a patent-pending and clinically tested vegan herbal blend that effectively manages...

Insider Guide: Science-backed Supplement Solution

Insider Guide: Science-backed Supplement Solution

SR CarnoSyn® | 16-Jun-2022 | Infographic

Check out this easy-to-read overview of SR CarnoSyn®, the globally patented, clinically confirmed supplement for wellness and healthy aging. The insider...

Happier with indication-specific probiotics

Happier with indication-specific probiotics

Winclove Probiotics | 06-Jun-2022 | Product Brochure

From the very founding of Winclove Probiotics, our aim to help people, society, and the world has been an essential part of our business DNA.

Set your brand apart with Collavant n2

Set your brand apart with Collavant n2

BIOIBERICA, S.A.U. | 06-Jun-2022 | Technical / White Paper

Native type II. Hydrolysed. Undenatured. There’s a variety of collagen products available on the market – but how can formulators identify the solution...

Related suppliers

Follow us


View more