Usana, which is based in Salt Lake City, UT, acquired Rise Bar, a manufacturer of protein bars, which is based in Irvine, CA. The manufacturer, which was founded in 2010, bills its products as the ‘simplest’ protein bars. For example, it’s Almond Honey Protein bar features just three ingredients: almonds, honey and whey protein isolate. The company has bars based on whey protein and pea protein. The protein dosages in the bars range from 13 grams to 20 grams per serving.
It also acquired Oola, a network marketing platform that bills itself as “The Mind and Body Company.” A variety of dietary supplements are listed for sale on the company’s website under the Oola brand name. The company also offers books and online wellness programs.
Both companies will continue to operate independently, according to the Usana statement. No details of either transaction were released.
“The acquisition of these emerging companies is part of USANA’s long-term growth strategy,” said Kevin Guest, Chief Executive Officer and Chairman of the Board.
“Both Rise Bar and Oola are innovators in the health and wellness industry. We believe we can utilize this innovation to expand our reach, product development, customer experience, and operational results. Going forward, we will continue to pursue accretive business development opportunities to advance our long-term growth strategy,” he added.
Usana has been under pressure recently on the heels of a disappointing third quarter earnings report, that saw the company projecting a fall below $1 billion in annual sales, a level the firm has not seen since 2015.
USANA is struggling both with higher costs and continuing effects of the global pandemic in some of the country’s most important markets. In its third quarter of fiscal 2022 the company recorded $233 million in revenue, which was down 15% over the same period a year previously, or about 9% when the current global currency tumult is taken into account.
Earnings per share fell even more steeply, showing a 44% slide. The foundation of those dismal returns was a serious erosion of the company’s customer base. The company reported it had 18% fewer active customers at the end of the quarter compared to the same period a year previously.
Stepping back from Asia?
For a number of years now USANA’s main markets have been in the Asia Pacific region. Of the $233 million of net sales in the quarter, $183 million were recorded in Asia, and $110 million within China itself. The Chinese market didn’t fall as steeply as did some others, such as North Asia, which was off by 22%, and Southeast Asia, where sales fell by 27%.
The acquistions announced yesterday could be a way for Usana to latch onto new streams of revenue that are independent of business conditions in the Asia/Pacific region. Whether or not that was part of the strategy behind the moves, the market responded favorably, sending the stock price up after trading opened on Tuesday. Overall, however, Usana’s shares are still down more than 45% this year.