8-K
Nu Skin Enterprises, Inc. (NUS)
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
| February 16, 2022 | ||
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| Date of Report (Date of earliest event reported) | ||
| NU SKIN ENTERPRISES, INC. | ||
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| (Exact name of registrant as specified in its charter) | ||
| Delaware | 001-12421 | 87-0565309 |
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| (State or other jurisdiction of incorporation) | (Commission File Number) | (IRS Employer Identification Number) |
| 75 West Center Street<br><br> <br>Provo, Utah 84601 | ||
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| (Address of principal executive offices and zip code) | ||
| (801) 345-1000 | ||
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| (Registrant’s telephone number, including area code) | ||
| N/A | ||
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| (Former name or former address, if changed since last report) |
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
| ☐ | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
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| ☐ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
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| ☐ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
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| ☐ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4 (c)) |
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Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading Symbol(s) | Name of each exchange on which registered |
|---|---|---|
| Class A Common Stock, $.001 par value | NUS | New York Stock Exchange |
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
| Item 2.02 | Results of Operations and Financial Condition. |
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On February 16, 2022, Nu Skin Enterprises, Inc. (the “Company”) issued a press release announcing its financial results for the three-month and annual periods ended December 31, 2021, and certain other information. A copy of the press release is attached as Exhibit 99.1 to this report.
The information furnished pursuant to this Item 2.02 and Exhibit 99.1 shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and shall not be deemed to be incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act except as shall be expressly set forth by specific reference in such filing.
| Item 9.01 | Financial Statements and Exhibits. |
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(d) Exhibits.
| 99.1 | Nu Skin Enterprises’ press release dated February 16, 2022, regarding financial results for the three-month and annual periods ended December 31, 2021. |
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| 104 | Cover Page Interactive Data File (embedded within the Inline XBRL document). |
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| NU SKIN ENTERPRISES, INC. | |
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| (Registrant) | |
| /s/ Mark H. Lawrence | |
| Mark H. Lawrence | |
| Chief Financial Officer | |
| Date: February 16, 2022 |
Exhibit 99.1
FOR IMMEDIATE RELEASE
Nu Skin Enterprises Reports Fourth Quarter and 2021 Financial Results
Company provides initial 2022 outlook and introduces Nu Vision 2025
PROVO, Utah — Feb. 16, 2022 — Nu Skin Enterprises, Inc. (NYSE: NUS) today announced fourth quarter and 2021 results.
Executive Summary
Q4 2021 vs. Prior-year Quarter
| Revenue: | $673.4 million; (10)%<br><br> <br>• (2)% fx impact or $(11.9) million |
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| Earnings Per Share (EPS): | $(0.18) or $1.11 excluding restructuring and impairment charges, compared to $1.40 in Q4 2020 |
| Sales Leaders: | 61,515; (13)% or 12% compared to 2019 |
| Customers: | 1,367,559; (12)% or 18% compared to 2019 |
2021 Annual vs. 2020
| Revenue: | $2.70 billion; +4%<br><br> <br>• 2% fx impact or $66.5 million |
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| Earnings Per Share (EPS): | $2.86 or $4.14 excluding restructuring and impairment charges, compared to $3.63 in 2020, or $3.10 in 2019<br><br> <br>• (21)% or 14% excluding restructuring and impairment charges<br><br> <br>• (8)% or 34% excluding restructuring and impairment charges compared to 2019 |
“For the year, we are encouraged with 4 percent year-over-year revenue growth and 11 percent growth compared to 2019, particularly considering the many COVID-related government restrictions, continued global uncertainty and ongoing transformation of our business,” said Ryan Napierski, Nu Skin President and CEO. “We generated strong demand for our two most recent products, Beauty Focus™ Collagen+ and ageLOC® Meta, as both performed well during the quarter. Our U.S. business grew 32 percent for the year on top of 37 percent in 2020, due in large part to ongoing adoption of our social selling model. Many of our Asian markets, including Mainland China, continue to be impacted by strict lockdowns and restrictions on in-person sales events and promotional activities. However, South Korea is gaining some traction with social commerce and grew 9 percent due to the ageLOC Meta preview and continued demand for our TR90 weight management product.
| Nu Skin Enterprises Reports Fourth Quarter and 2021 Results | Page 2 |
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“Looking ahead to 2022, we anticipate another year of growth as we continue our transformation toward becoming the world’s leading integrated beauty and wellness company, powered by our dynamic affiliate opportunity platform. Our Nu Vision 2025 strategy, which we will introduce at our investor event later today, encompasses several key strategic imperatives to accelerate growth, including: our EmpowerMe personalized beauty and wellness strategy with connected beauty devices; our affiliate-powered social commerce business model; and the expansion of our digital platform. We are confident in our plans as we work toward achieving our vision for the future.”
Q4 2021 Year-over-year Operating Results
| Revenue: | $673.4 million compared to $748.2 million<br><br> <br>• (2)% fx impact |
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| Gross Margin: | 74.2% or 75.2% excluding restructuring and impairment charges compared to 74.0%<br><br> <br>• Nu Skin business was 77.9% compared to 76.5% |
| Selling Expenses: | 38.7% compared to 38.0%<br><br> <br>• Nu Skin business was 41.0% compared to 40.3% |
| G&A Expenses: | 24.7% compared to 24.1% |
| Operating Margin: | 3.0% or 11.7% excluding restructuring and impairment charges compared to 11.9% |
| Other Income / (Expense): | $(1.9) million compared to $2.7 million |
| Income Tax Rate: | 150.1% or 26.9% excluding restructuring and impairment charges, compared to 19.6% |
| EPS: | $(0.18) or $1.11 excluding restructuring and impairment charges, compared to $1.40 |
Stockholder Value
| Dividend Payments: | $18.9 million |
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| Stock Repurchases: | $10.0 million<br><br> <br>• $245.4 million remaining in authorization |
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| Nu Skin Enterprises Reports Fourth Quarter and 2021 Results | Page 3 |
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Q1 and Full-year 2022 Outlook
| Q1 2022 Revenue: | $560 to $590 million; (13) to (17)%<br><br> <br>• Approximately (2) to (3)% fx impact |
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| Q1 2022 EPS: | $0.65 to $0.75; (18) to (28)% |
| 2022 Revenue: | $2.66 to $2.77 billion; (1) to 3%<br><br> <br>• Approximately (1) to (2)% fx impact |
| 2022 EPS: | $4.05 to $4.45; +42 to 56% on a reported basis, or (2) to 8% non-GAAP |
“We are especially pleased with our adjusted earnings per share of $4.14 for the year and $1.11 for the quarter, driven by gross margin and operational improvements. Full year adjusted EPS results represent annual growth of 14 percent versus 2020 or 34 percent compared to 2019,” added Mark Lawrence, chief financial officer. “During the quarter, we elected to exit our Grow Tech business and re-focus those resources on key strategic initiatives and growth objectives in our core business. We took a one-time pre-tax charge of $58.5 million and anticipate that substantially all the non-cash charges were incurred in the fourth quarter of 2021. As a result of these charges, our reported earnings per share was $2.86 for the year and $(0.18) for the quarter. Our 2022 outlook indicates that we plan to re-invest the bulk of the savings from the exit into technology that will further support our affiliates and drive long-term growth.
“Our 2022 revenue guidance is $2.66 to $2.77 billion with EPS of $4.05 to $4.45. First quarter projected revenue is $560 to $590 million with EPS of $0.65 to $0.75. Although our near-term guidance continues to be impacted by global uncertainty, we believe our strategic initiatives will enable stronger growth in the second half. We remain committed to driving operational improvements along the way toward our stated mid-term 13 percent operating income target,” concluded Lawrence.
Investor Day
The Nu Skin Enterprises management team will host an investor day event today at noon (ET). To tune in to the webcast and view supplemental materials, visit Nu Skin’s investor relations page at ir.nuskin.com when the event begins. A replay of the event, along with supplemental materials, will be available on the same page through March 2, 2022.
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| Nu Skin Enterprises Reports Fourth Quarter and 2021 Results | Page 4 |
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About Nu Skin Enterprises, Inc.
Nu Skin Enterprises, Inc. (NYSE: NUS) is a leading beauty and wellness company, powered by a dynamic affiliate opportunity platform. The company helps people live, look and feel their best with products that combine the best of science, technology and nature. Backed by more than 35 years of scientific research, Nu Skin develops innovative products including Nu Skin® personal care, Pharmanex® nutrition and the ageLOC® anti-aging brand which includes an award-winning line of beauty device systems. Nu Skin operates in approximately 50 markets worldwide in the Americas, Asia, Europe, Africa and the Pacific. Rhyz Inc. is the company’s strategic investment arm that includes a collection of technology and manufacturing companies to support growth in the core Nu Skin business. Nu Skin is committed to sustainability, including global initiatives such as transitioning to reduced and sustainable packaging for all products by 2030. The Nu Skin Force for Good Foundation also strives to improve children’s health, education and economic circumstances throughout the world. For more information, visit nuskin.com.
Important Information Regarding Forward-Looking Statements: This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, that represent the company’s current expectations and beliefs. All statements other than statements of historical fact are “forward-looking statements” for purposes of federal and state securities laws and include, but are not limited to, statements of management’s expectations regarding the company’s performance, growth, shareholder value, vision, transformation, initiatives, product pipeline and product introductions, digital tools, customers and sales leaders, affiliates, strategies and initiatives; operational improvements, projections regarding revenue, expenses, operating income, earnings per share, foreign currency fluctuations, uses of cash and other financial items; statements of belief; and statements of assumptions underlying any of the foregoing. In some cases, you can identify these statements by forward-looking words such as “believe,” “expect,” “anticipate,” “project,” “outlook,” “guidance,” “remain,” “become,” “plan,” “opportunity,” “expand,” “will,” “would,” “could,” “may,” “might,” the negative of these words and other similar words.
The forward-looking statements and related assumptions involve risks and uncertainties that could cause actual results and outcomes to differ materially from any forward-looking statements or views expressed herein. These risks and uncertainties include, but are not limited to, the following:
| • | risk that epidemics, including the ongoing COVID-19 pandemic, and other crises could negatively impact our business; |
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| • | adverse publicity related to the company’s business, products, industry or any legal actions or complaints by the company’s sales force or others; |
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| • | risk that direct selling laws and regulations in any of the company’s markets, including the United States and Mainland China, may be modified, interpreted or enforced in a manner that results in negative<br> changes to the company’s business model or negatively impacts its revenue, sales force or business, including through the interruption of sales activities, loss of licenses, increased scrutiny of sales force actions, imposition of fines, or<br> any other adverse actions or events; |
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| Nu Skin Enterprises Reports Fourth Quarter and 2021 Results | Page 5 |
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| • | any failure of current or planned initiatives or products to generate interest among the company’s sales force and customers and generate sponsoring and selling activities on a sustained basis; |
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| • | political, legal, tax and regulatory uncertainties associated with operating in international markets, including Mainland China; |
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| • | uncertainty regarding meeting restrictions and other government scrutiny in Mainland China, as well as negative media and consumer sentiment in Mainland China on our business operations and results; |
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| • | risk of foreign-currency fluctuations and the currency translation impact on the company’s business associated with these fluctuations; |
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| • | uncertainties regarding the future financial performance of the businesses the company has acquired; |
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| • | risks related to accurately predicting, delivering or maintaining sufficient quantities of products to support planned initiatives or launch strategies, and increased risk of inventory write-offs if the<br> company over-forecasts demand for a product or changes its planned initiatives or launch strategies; |
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| • | regulatory risks associated with the company’s products, which could require the company to modify its claims or inhibit its ability to import or continue selling a product in a market if the product is<br> determined to be a medical device or if the company is unable to register the product in a timely manner under applicable regulatory requirements; |
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| • | unpredictable economic conditions and events globally, including trade policies and tariffs; |
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| • | the company’s future tax-planning initiatives; any prospective or retrospective increases in duties on the company’s products imported into the company’s markets outside of the United States; and any adverse<br> results of tax audits or unfavorable changes to tax laws in the company’s various markets; and |
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| • | continued competitive pressures in the company’s markets. |
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The company’s financial performance and the forward-looking statements contained herein are further qualified by a detailed discussion of associated risks set forth in the documents filed by the company with the Securities and Exchange Commission. The forward-looking statements set forth the company’s beliefs as of the date that such information was first provided, and the company assumes no duty to update the forward-looking statements contained in this release to reflect any change except as required by law.
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| Nu Skin Enterprises Reports Fourth Quarter and 2021 Results | Page 6 |
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The following table sets forth revenue for the three-month periods ended December 31, 2021 and 2020 for each of our reportable segments (U.S. dollars in thousands):
| Three Months Ended<br><br> <br>December 31, | Constant-<br><br> <br>Currency | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| 2021 | 2020 | Change | Change | |||||||||
| Nu Skin | ||||||||||||
| Mainland China | $ | 130,708 | $ | 172,442 | (24 | )% | (26 | )% | ||||
| Americas | 144,000 | 140,586 | 2 | % | 4 | % | ||||||
| South Korea | 92,528 | 90,384 | 2 | % | 8 | % | ||||||
| Southeast Asia/Pacific | 90,313 | 99,589 | (9 | )% | (8 | )% | ||||||
| EMEA | 68,066 | 82,656 | (18 | )% | (14 | )% | ||||||
| Japan | 63,215 | 73,132 | (14 | )% | (6 | )% | ||||||
| Hong Kong/Taiwan | 47,816 | 45,864 | 4 | % | 3 | % | ||||||
| Nu Skin other | (801 | ) | (391 | ) | (105 | )% | (105 | )% | ||||
| Total Nu Skin | 635,845 | 704,262 | (10 | )% | (8 | )% | ||||||
| Rhyz Investments | ||||||||||||
| Manufacturing | 36,360 | 43,364 | (16 | )% | (16 | )% | ||||||
| Grow Tech | 957 | 567 | 69 | % | 69 | % | ||||||
| Rhyz other | 274 | — | ||||||||||
| Total Rhyz Investments | 37,591 | 43,931 | (14 | )% | (14 | )% | ||||||
| Total | $ | 673,436 | $ | 748,193 | (10 | )% | (8 | )% |
The following table sets forth revenue for the years ended December 31, 2021 and 2020 for each of our reportable segments (U.S. dollars in thousands):
| Year Ended<br><br> <br>December 31, | Constant-<br><br> <br>Currency | ||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|
| 2021 | 2020 | Change | Change | ||||||||
| Nu Skin | |||||||||||
| Mainland China | $ | 568,774 | $ | 625,538 | (9 | )% | (15 | )% | |||
| Americas | 547,755 | 453,022 | 21 | % | 20 | % | |||||
| South Korea | 354,252 | 326,478 | 9 | % | 6 | % | |||||
| Southeast Asia/Pacific | 336,651 | 361,627 | (7 | )% | (9 | )% | |||||
| EMEA | 283,200 | 230,246 | 23 | % | 18 | % | |||||
| Japan | 266,216 | 273,681 | (3 | )% | — | ||||||
| Hong Kong/Taiwan | 162,611 | 161,117 | 1 | % | (2 | )% | |||||
| Nu Skin other | 1,549 | (17 | ) | 9,212 | % | 9,212 | % | ||||
| Total Nu Skin | 2,521,008 | 2,431,692 | 4 | % | 1 | % | |||||
| Rhyz Investments | |||||||||||
| Manufacturing | 172,120 | 149,339 | 15 | % | 15 | % | |||||
| Grow Tech | 2,104 | 903 | 133 | % | 133 | % | |||||
| Rhyz other | 437 | — | |||||||||
| Total Rhyz Investments | 174,661 | 150,242 | 16 | % | 16 | % | |||||
| Total | $ | 2,695,669 | $ | 2,581,934 | 4 | % | 2 | % | |||
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The company's Customers and Sales Leaders statistics by segment as of December 31, 2021 and 2020 are presented in the following table:
| 2021 | 2020 | % Increase<br><br> <br>(Decrease) | ||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Customers | Sales Leaders | Customers | Sales Leaders | Customers | Sales Leaders | |||||||||
| Mainland China | 315,418 | 17,658 | 381,460 | 21,990 | (17 | )% | (20 | )% | ||||||
| Americas | 336,564 | 10,340 | 366,688 | 12,754 | (8 | )% | (19 | )% | ||||||
| South Korea | 146,354 | 7,108 | 158,953 | 7,059 | (8 | )% | 1 | % | ||||||
| Southeast Asia/Pacific | 169,601 | 10,386 | 192,622 | 10,588 | (12 | )% | (2 | )% | ||||||
| EMEA | 210,414 | 6,124 | 258,587 | 7,063 | (19 | )% | (13 | )% | ||||||
| Japan | 122,813 | 5,872 | 128,400 | 6,318 | (4 | )% | (7 | )% | ||||||
| Hong Kong/Taiwan | 66,395 | 4,027 | 70,592 | 4,663 | (6 | )% | (14 | )% | ||||||
| Total | 1,367,559 | 61,515 | 1,557,302 | 70,435 | (12 | )% | (13 | )% |
“Customers” are persons who purchased products directly from the company during the previous three months. Our Customer numbers do not include consumers who purchase products directly from members of our sales force.
“Sales Leaders” are independent distributors, and sales employees and independent marketers in China, who achieve certain qualification requirements.
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NU SKIN ENTERPRISES, INC.
Consolidated Statements of Income (Unaudited)
(U.S. dollars in thousands, except per share amounts)
| Three Months Ended<br><br> <br>December 31, | Years Ended<br><br> <br>December 31, | ||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|
| 2021 | 2020 | 2021 | 2020 | ||||||||
| Revenue | $ | 673,436 | $ | 748,193 | $ | 2,695,669 | $ | 2,581,934 | |||
| Cost of sales | 173,775 | 194,751 | 675,223 | 658,028 | |||||||
| Gross profit | 499,661 | 553,442 | 2,020,446 | 1,923,906 | |||||||
| Operating expenses: | |||||||||||
| Selling expenses | 260,831 | 284,129 | 1,068,189 | 1,019,494 | |||||||
| General and administrative expenses | 166,641 | 180,616 | 666,395 | 646,848 | |||||||
| Restructuring and impairment expenses | 51,870 | — | 51,870 | — | |||||||
| Total operating expenses | 479,342 | 464,745 | 1,786,454 | 1,666,342 | |||||||
| Operating income | 20,319 | 88,697 | 233,992 | 257,564 | |||||||
| Other income (expense), net | (1,883 | ) | 2,736 | (1,533 | ) | (1,332 | ) | ||||
| Income before provision for income taxes | 18,436 | 91,433 | 232,459 | 256,232 | |||||||
| Provision for income taxes | 27,666 | 17,966 | 85,193 | 64,877 | |||||||
| Net income | $ | (9,230 | ) | $ | 73,467 | $ | 147,266 | $ | 191,355 | ||
| Net income per share: | |||||||||||
| Basic | $ | (0.19 | ) | $ | 1.44 | $ | 2.93 | $ | 3.66 | ||
| Diluted | $ | (0.18 | ) | $ | 1.40 | $ | 2.86 | $ | 3.63 | ||
| Weighted-average common shares outstanding (000s): | |||||||||||
| Basic | 49,862 | 50,971 | 50,193 | 52,296 | |||||||
| Diluted | 50,801 | 52,403 | 51,427 | 52,765 | |||||||
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NU SKIN ENTERPRISES, INC.
Consolidated Balance Sheets (Unaudited)
(U.S. dollars in thousands)
| December 31, 2020 | |||||
|---|---|---|---|---|---|
| ASSETS | |||||
| Current assets: | |||||
| Cash and cash equivalents | 339,593 | $ | 402,683 | ||
| Current investments | 15,221 | 21,216 | |||
| Accounts receivable, net | 41,299 | 63,370 | |||
| Inventories, net | 399,931 | 314,366 | |||
| Prepaid expenses and other | 76,906 | 101,563 | |||
| Total current assets | 872,950 | 903,198 | |||
| Property and equipment, net | 453,674 | 468,181 | |||
| Operating lease right-of-use assets | 120,973 | 155,104 | |||
| Goodwill | 206,432 | 202,979 | |||
| Other intangible assets, net | 76,991 | 89,532 | |||
| Other assets | 175,460 | 138,082 | |||
| Total assets | 1,906,480 | $ | 1,957,076 | ||
| LIABILITIES AND STOCKHOLDERS’ EQUITY | |||||
| Current liabilities: | |||||
| Accounts payable | 49,993 | $ | 66,174 | ||
| Accrued expenses | 372,201 | 446,682 | |||
| Current portion of long-term debt | 107,500 | 30,000 | |||
| Total current liabilities | 529,694 | 542,856 | |||
| Operating lease liabilities | 88,759 | 112,275 | |||
| Long-term debt | 268,781 | 305,393 | |||
| Other liabilities | 106,474 | 102,281 | |||
| Total liabilities | 993,708 | 1,062,805 | |||
| Commitments and contingencies | |||||
| Stockholders’ equity: | |||||
| Class A common stock – 500 million shares authorized, 0.001 par value, 90.6 million shares issued | 91 | 91 | |||
| Additional paid-in capital | 601,703 | 579,801 | |||
| Treasury stock, at cost – 40.7 million and 39.7 million shares | (1,526,860 | ) | (1,461,593 | ) | |
| Accumulated other comprehensive loss | (73,896 | ) | (64,768 | ) | |
| Retained earnings | 1,911,734 | 1,840,740 | |||
| Total stockholders' equity | 912,772 | 894,271 | |||
| Total liabilities and stockholders’ equity | 1,906,480 | $ | 1,957,076 |
All values are in US Dollars.
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Non-GAAP Financial Measures: Constant-currency revenue change is a non-GAAP financial measure that removes the impact of fluctuations in foreign-currency exchange rates, thereby facilitating period-to-period comparisons of the company’s performance. It is calculated by translating the current period’s revenue at the same average exchange rates in effect during the applicable prior-year period and then comparing that amount to the prior-year period’s revenue. The company believes that constant-currency revenue change is useful to investors, lenders and analysts because such information enables them to gauge the impact of foreign-currency fluctuations on the company’s revenue from period to period.
Gross margin, operating margin, income tax rate, earnings per share and adjusted earnings per share growth, each excluding impairment and restructuring charges, also are non-GAAP financial measures. Impairment and restructuring charges are not part of the ongoing operations of our underlying business. The company believes that these non-GAAP financial measures are useful to investors, lenders and analysts because removing the impact of impairment and restructuring charges facilitates period-to-period comparisons of the company’s performance. Please see the reconciliations of these items to our gross margin, operating margin, income tax rate, earnings per share and earnings per share growth calculated under GAAP, below.
NU SKIN ENTERPRISES, INC.
Reconciliation of Earnings Per Share Excluding Impact of Restructuring and Impairment to GAAP Earnings Per Share
(in thousands, except per share amounts)
| Three Months Ended<br><br> <br>December 31, | Years Ended<br><br> <br>December 31, | ||||||||
|---|---|---|---|---|---|---|---|---|---|
| 2021 | 2020 | 2021 | 2020 | ||||||
| Net income | $ | (9,230 | ) | $ | 73,467 | $ | 147,266 | $ | 191,335 |
| Impact of restructuring and impairment: | |||||||||
| Restructuring and impairment | 51,870 | — | 51,870 | — | |||||
| Inventory write-off | 6,656 | — | 6,656 | — | |||||
| Income tax impact | 6,933 | — | 6,933 | — | |||||
| Adjusted net income | $ | 56,229 | $ | 73,467 | $ | 212,725 | $ | 191,335 | |
| Diluted earnings per share | $ | (0.18 | ) | $ | 1.40 | $ | 2.86 | $ | 3.63 |
| Diluted earnings per share, excluding restructuring and impairment impact | $ | 1.11 | $ | 1.40 | $ | 4.14 | $ | 3.63 | |
| Weighted-average common shares outstanding (000s): | 50,801 | 52,403 | 51,427 | 52,765 | |||||
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NU SKIN ENTERPRISES, INC.
Reconciliation of Earnings Per Share Growth Rate Excluding Impact of Restructuring and Impairment to GAAP Earnings Per Share
(in thousands, except per share amounts)
| Years Ended<br><br> December 31, | |||||||
|---|---|---|---|---|---|---|---|
| 2021 | 2020 | 2019 | |||||
| Net income | $ | 147,266 | $ | 191,335 | $ | 173,553 | |
| Impact of restructuring and impairment: | |||||||
| Restructuring and impairment | 51,870 | — | — | ||||
| Inventory write-off | 6,656 | — | — | ||||
| Income tax impact | 6,933 | — | — | ||||
| Adjusted net income | $ | 212,725 | $ | 191,335 | $ | 173,553 | |
| Diluted earnings per share | $ | 2.86 | $ | 3.63 | $ | 3.10 | |
| Diluted earnings per share, excluding restructuring and impairment impact | $ | 4.14 | $ | 3.63 | $ | 3.10 | |
| Weighted-average common shares outstanding (000s): | 51,427 | 52,765 | 55,927 | ||||
| 2021 annual growth rate | |||||||
| Earnings per share, growth rate | (21 | )% | |||||
| Earnings per share, growth rate, excluding restructuring and impairment impact | 14 | % | |||||
| 2021 growth over 2019 | |||||||
| Earnings per share, growth rate | (8 | )% | |||||
| Earnings per share, growth rate, excluding restructuring and impairment impact | 34 | % |
NU SKIN ENTERPRISES, INC.
Reconciliation of Gross Margin Excluding Impact of Restructuring and Impairment to GAAP Gross Margin
(in thousands, except per share amounts)
| Three Months Ended<br><br> <br>December 31, | Years Ended<br><br> <br>December 31, | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| 2021 | 2020 | 2021 | 2020 | |||||||||
| Gross Profit | $ | 499,661 | $ | 553,442 | $ | 2,020,446 | $ | 1,923,906 | ||||
| Impact of restructuring and impairment: | ||||||||||||
| Inventory write-off | 6,656 | — | 6,656 | — | ||||||||
| Adjusted Gross Profit | $ | 506,317 | $ | 553,442 | $ | 2,027,102 | $ | 1,923,906 | ||||
| Gross margin | 74.2 | % | 74.0 | % | 75.0 | % | 74.5 | % | ||||
| Gross margin, excluding restructuring and impairment impact | 75.2 | % | 74.0 | % | 75.2 | % | 74.5 | % | ||||
| Revenue | $ | 673,436 | $ | 748,193 | $ | 2,695,669 | $ | 2,581,934 |
NU SKIN ENTERPRISES, INC.
Reconciliation of Operating Margin Excluding Impact of Restructuring to GAAP Operating Margin
(in thousands, except per share amounts)
| Three Months Ended<br><br> <br>December 31, | Years Ended<br><br> <br>December 31, | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| 2021 | 2020 | 2021 | 2020 | |||||||||
| Operating income | $ | 20,319 | $ | 88,697 | $ | 233,992 | $ | 257,564 | ||||
| Impact of restructuring and impairment: | ||||||||||||
| Restructuring and impairment | 51,870 | — | 51,870 | — | ||||||||
| Inventory write-off | 6,656 | — | 6,656 | — | ||||||||
| Adjusted operating income | $ | 78,845 | $ | 88,697 | $ | 292,518 | $ | 257,564 | ||||
| Operating margin | 3.0 | % | 11.9 | % | 8.7 | % | 10.0 | % | ||||
| Operating margin, excluding restructuring and impairment impact | 11.7 | % | 11.9 | % | 10.9 | % | 10.0 | % | ||||
| Revenue | $ | 673,436 | $ | 748,193 | $ | 2,695,669 | $ | 2,581,934 | ||||
| - more - | ||||||||||||
| --- |
| Nu Skin Enterprises Reports Fourth Quarter and 2021 Results | Page 12 |
|---|
NU SKIN ENTERPRISES, INC.
Reconciliation of Effective Tax Rate Excluding Impact of Restructuring to GAAP Effective Tax Rate
(in thousands, except per share amounts)
| Three Months Ended<br><br> <br>December 31, | Years Ended<br><br> <br>December 31, | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| 2021 | 2020 | 2021 | 2020 | |||||||||
| Provision for income taxes | $ | 27,666 | $ | 17,966 | $ | 85,193 | $ | 64,877 | ||||
| Impact of restructuring on tax provision | (6,933 | ) | — | (6,933 | ) | — | ||||||
| Provision for income taxes, excluding impact of restructuring | $ | 20,733 | $ | 17,966 | $ | 78,260 | $ | 64,877 | ||||
| Income before provision for income taxes | $ | 18,436 | $ | 91,433 | $ | 232,459 | $ | 256,232 | ||||
| Impact of restructuring and impairment: | ||||||||||||
| Restructuring and impairment | 51,870 | — | 51,870 | — | ||||||||
| Inventory write-off | 6,656 | — | 6,656 | — | ||||||||
| Income before provision for income taxes, excluding restructuring and impairment impact | $ | 76,962 | $ | 91,433 | $ | 290,985 | $ | 256,232 | ||||
| Effective tax rate | 150.1 | % | 19.6 | % | 36.6 | % | 25.3 | % | ||||
| Effective tax rate, excluding restructuring and impairment impact | 26.9 | % | 19.6 | % | 26.9 | % | 25.3 | % |
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CONTACTS:
Media: media@nuskin.com, (801) 345-6397
Investors: investorrelations@nuskin.com, (801) 345-3577