Nature’s Sunshine joins Usana among firms relying on sales in Asia
The company, which is based in Lehi, UT, posted its results after market close on Wednesday. The company posted $110 million in revenue during the quarter, which represented a 7.9% year over year increase.
Sales gains come from Asia
While that’s good news, it is interesting to note that the entirety of the sales gains came from the company’s Asia Pacific markets.
That’s also noteworthy in light of the fact that a difficult entry into the mainland market in China was a significant drag on the company’s fortunes only five years ago. Now the region has become a stronghold for the firm, much as it has for competitor Usana, another Utah-based MLM that concentrates on the sales of dietary supplements.
For the quarter Nature’s Sunshine recored $46.1 million in sales in the Asia Pacific region, compared to $35.8 million in the same period a year previously. That represented a 29% year over year increase. Sales in North America were $40 million, which represented a 4.7% decline from the year previously. Sales declined in Europe and to a lesser extent in Latin America as well. 2021 was the first year in the company’s history in which full year net sales in the Asia Pacific outpaced those in North America.
Nature’s Sunshine CEO Terrence Moorehead said supply chain challenges accounted for the weak results in North America and the war in Ukraine was a drag on results in Europe.
“In the first quarter we delivered strong top-line growth despite headwinds from COVID-19, intensifying global supply chain issues, rampant inflation and the devastating war in Ukraine,” Moorehead said in a statement.
“Sourcing challenges also inhibited our ability to meet product demand and drive growth in our North American segment. Despite these headwinds, we look forward to overcoming these near-term challenges and continue to invest ahead of growth, bolstered by a healthy balance sheet, strong global growth strategies and our firm belief in the long-term potential of our business,” he added.
Net loss in quarter
Moorehead was mum on why sourcing challenges didn’t also put a brake on results in the Asian markets. The supply chain problems, inflation and currency concerns conspired to make the company lose $2.7 million in the quarter, compared to a $4.2 million profit in the same time frame a year previously.