Press release from PR Newswire
Reliv International Reports Third-Quarter Financial Results
Wednesday, November 02, 2011
Reliv International Reports Third-Quarter Financial Results06:45 EDT Wednesday, November 02, 2011CHESTERFIELD, Mo., Nov. 2, 2011 /PRNewswire/ -- Reliv International, Inc. (NASDAQ: RELV), a maker of nutritional supplements that promote optimal health, today reported its financial results for the third quarter of 2011.Net sales for the quarter were $17.3 million, a 7.3 percent decrease from the third quarter last year. Net U.S. sales totaled $14.1 million, down from third-quarter 2010 net sales of $16.0 million. Net sales outside of the United States rose 17.7 percent in the third quarter of 2011 compared to the prior-year quarter, led by the European market where net sales more than doubled. Net income for the third quarter of 2011 was $49,000 or $0.00 per diluted share, compared to $172,000 or $0.01 per diluted share in the 2010 third quarter. The decline in net income is primarily due to the decrease in U.S. net sales."We are focused on increasing sales in the United States, though we are faced with a tough economic environment," said Robert L. Montgomery, chairman, president and chief executive officer of Reliv. "Consumer confidence is at its lowest level since early 2009, and consumers appear to be spending less as they reduce debt," Montgomery said.He added, "We are developing a program designed to increase our customer base quickly, with a longer-term goal of turning a percentage of these new customers into distributors who want to build a Reliv business. Ultimately, this program should help our existing distributors expand their own sales organizations," Montgomery said."We also continue to roll out our new branding initiative. We plan to strengthen our interactive marketing efforts and we continue to work on new-product development," Montgomery said. "At the same time, we have a focus on reducing costs in all of our offices," he added. Reliv reported a reduction in selling, general and administrative expenses of $312,000 in the third quarter of 2011 compared to the prior-year quarter.Net sales for the first nine months of 2011 were $57.0 million, which represents a 5.4 percent decrease from the same period in 2010. Reliv's international net sales, driven by strong results in Europe, rose 8.0 percent in the first three quarters of 2011 compared with the first three quarters last year. In the United States, net sales declined 7.7 percent due to the same issues in consumer confidence that impacted sales in the third quarter.Reliv reported net income of $728,000, or $0.06 per diluted share in the first nine months of 2011, compared to $1.1 million or $0.09 per diluted share in the same period of 2010. Reliv's total distributor count was 57,660 as of September 30, 2011, a reduction of 7.3 percent from the same date in 2010. New distributor enrollments for the quarter declined 12 percent from the third quarter last year.Net cash generated from operating activities in the first nine months of 2011 totaled $2.2 million, representing an increase of $552,000 over the first nine months of 2010, primarily the result of the decrease in inventory. Reliv had cash and cash equivalents of $7.1 million as of September 30, 2011, an 11.5 percent increase over the same date last year. About RelivReliv International, Inc., based in Chesterfield, Missouri, makes nutritional supplements that promote optimal health. Reliv supplements address essential nutrition, weight loss, athletic performance, digestive health, women's health, anti-aging and energy and mental focus. The company also markets premium personal care products through its Relivables line. Reliv sells its products through an international network marketing system of independent distributors in 15 countries. Learn more about Reliv at www.reliv.com, or on Facebook, Twitter or YouTube. Statements made in this news release that are not historical facts are "forward-looking" statements (as defined in the Private Securities Litigation Reform Act of 1995) that involve risks and uncertainties and are subject to change at any time. These forward-looking statements may include, but are not limited to, statements containing words such as "may," "should," "could," "would," "expect," "plan," "anticipate," "believe," "estimate," "predict," "potential," "continue" or similar expressions. Factors that could cause actual results to differ are identified in the public filings made by Reliv with the Securities and Exchange Commission. More information on factors that could affect Reliv's business and financial results are included in its public filings made with the Securities and Exchange Commission, including its Annual Report on Form 10-K and Quarterly Reports on Form 10-Q, copies of which are available on the Company's web site, www.reliv.com. _-FINANCIAL HIGHLIGHTS FOLLOW ?Reliv International, Inc. and SubsidiariesCondensed Consolidated Balance SheetsSeptember 30December 3120112010(Unaudited)AssetsCurrent Assets:Cash and cash equivalents$7,140,671$6,331,038Accounts receivable, less allowances of$69,400 in 2011 and $67,100 in 2010274,767291,405Accounts due from employees and distributors50,02355,854Inventories5,206,3005,650,790Other current assets1,199,636916,239Total current assets13,871,39713,245,326Other assets2,035,7021,867,976Intangible assets, net1,636,1471,785,987Net property, plant and equipment7,486,0857,944,412Total Assets$25,029,331$24,843,701Liabilities and Stockholders' EquityTotal current liabilities$6,837,952$6,387,164Long-term debt, less current maturities3,713,1884,150,770Other non-current liabilities261,770375,244Stockholders' equity14,216,42113,930,523Total Liabilities and Stockholders' Equity$25,029,331$24,843,701Consolidated Statements of IncomeThree months ended September 30 Nine months ended September 30 2011201020112010(Unaudited)(Unaudited)(Unaudited)(Unaudited)Product sales$15,382,332$16,612,215$50,693,657$53,559,074Handling & freight income1,927,2612,060,8496,300,7126,661,873Net Sales17,309,59318,673,06456,994,36960,220,947Costs and expenses: Cost of products sold3,601,1163,820,49011,636,64712,093,367 Distributor royalties and commissions6,450,1557,011,21721,317,10522,560,625 Selling, general and administrative7,089,8327,402,21022,766,19823,486,389Total Costs and Expenses17,141,10318,233,91755,719,95058,140,381Income from operations168,490439,1471,274,4192,080,566Other income (expense):Interest income7,04512,96132,84635,334Interest expense(32,925)(52,885)(105,349)(159,336)Other income (expense)(452)43713,88321,592Income before income taxes142,158399,6601,215,7991,978,156Provision for income taxes93,000228,000488,000854,000Net Income$49,158$171,660$727,799$1,124,156Earnings per common share - Basic$0.00$0.01$0.06$0.09Weighted average shares 12,416,00012,380,00012,436,00012,380,000Earnings per common share - Diluted$0.00$0.01$0.06$0.09Weighted average shares 12,416,00012,380,00012,436,00012,380,000Cash dividends declared per common share$ -$ -$0.03$0.02Reliv International, Inc. and SubsidiariesNet sales by Market(in thousands)Three months ended September 30,Change From20112010Prior YearAmount% of Net SalesAmount% of Net SalesAmount%United States$ 14,13481.6%$ 15,97585.5%$ (1,841)-11.5%Australia/New Zealand5633.2%6563.5%(93)-14.2%Canada4952.9%5052.7%(10)-2.0%Mexico2801.6%3201.7%(40)-12.5%Europe9985.8%4392.4%559127.3%Asia8404.9%7784.2%628.0%Consolidated total$ 17,310100.0%$ 18,673100.0%$ (1,363)-7.3%Net sales by Market(in thousands)Nine months ended September 30,Change From20112010Prior YearAmount% of Net SalesAmount% of Net SalesAmount%United States$ 47,44083.3%$ 51,37885.3%$ (3,938)-7.7%Australia/New Zealand1,7783.1%1,9243.2%(146)-7.6%Canada1,6692.9%1,6342.7%352.1%Mexico9821.7%1,1071.9%(125)-11.3%Europe2,5774.5%1,4402.4%1,13779.0%Asia2,5484.5%2,7384.5%(190)-6.9%Consolidated total$ 56,994100.0%$ 60,221100.0%$ (3,227)-5.4%The following table sets forth, as of September 30, 2011 and 2010, the number of our active distributors and Master Affiliates and above. The total number of active distributors includes Master Affiliates and above. We define an active distributor as one that enrolls as a distributor or renews its distributorship during the prior twelve months. Master Affiliates and above are distributors that have attained the highest level of discount and are eligible for royalties generated by Master Affiliates and above in their downline organization. Growth in the number of active distributors and Master Affiliates and above is a key factor in continuing the growth of our business.Active Distributors and Master Affiliates and above by MarketAs of 9/30/2011As of 9/30/2010Change in % TotalActive DistributorsMaster Affiliates and Above Total Active DistributorsMaster Affiliates and AboveTotalActive DistributorsMaster Affiliates and AboveUnited States44,9005,92048,5206,730-7.5%-12.0%Australia/New Zealand1,9501602,410200-19.1%-20.0%Canada1,3502001,390180-2.9%11.1%Mexico1,3102302,100300-37.6%-23.3%Europe3,2803601,86026076.3%38.5%Asia4,8705005,950620-18.2%-19.4%Consolidated total57,6607,37062,2308,290-7.3%-11.1%SOURCE Reliv International, Inc.For further information: Steve Albright, Chief Financial Officer, +1-636-733-1305, for Reliv International, Inc.