CHESTERFIELD, Mo., Oct. 29, 2008 (GLOBE NEWSWIRE) -- Reliv International, Inc. (Nasdaq:RELV), a nutrition and direct selling company, today reported net sales for the third quarter of $23.9 million, compared to net sales of $25.1 million in the third quarter last year.
Net income for the third quarter equaled $536,000 or $0.04 per diluted share, compared to net income of $901,000 or $0.06 per diluted share in the third quarter of 2007.
For the nine months ended Sept. 30, net sales equaled $76.1 million compared to $86.4 million in the first nine months of 2007. Net income was $2.6 million through three quarters of 2008, or $0.17 per diluted share, compared to $4.3 million or $0.27 per diluted share for the same period last year. Excluding the one-time, after-tax charge related to restructuring Reliv's European operations in this year's second quarter, earnings through nine months would have been $2.7 million, and earnings per share would have been $0.18.
Net sales in the United States equaled $20.8 million in the third quarter compared to net sales of $22.0 million in the third quarter of 2007, a 5.4 percent decline. International net sales (sales outside of the United States) declined 2.1 percent to $3.0 million from $3.1 million in the third quarter of last year.
As of Sept. 30, 2008, Reliv's distributor base totaled approximately 68,540, which represents a slight drop from a year ago.
"The third quarter was not as strong as we had hoped for, and we believe the shocks to the U.S. economy in September played a role in our sales decline," said Robert L. Montgomery, president, chairman and chief executive officer of Reliv.
"Short-term, restructuring our European operations significantly reduced our pre-tax losses in that region as we expected. But that improvement was negated by lower U.S. pre-tax profits resulting from a sales decline," Montgomery said.
"We launched an automatic shipping program in the U.S. at our International Conference in August, which we believe will be a long-term positive for our business. We also launched the program in Australia this month," he added.
"In addition to a planned product launch on Nov. 8, we continue to look for proven incentive programs to stimulate sales, and we have a national conference for U.S. distributors scheduled for February 2009, which should further motivate our field," Montgomery said.
Selling, general and administrative (SG&A) costs in the third quarter were down compared to SG&A expenses in the year-ago quarter, and Reliv also achieved a slight drop in SG&A as a percentage of sales. Lower SG&A figures in the United States and Germany helped lead to the decline.
Cash from operations for the first nine months of 2008 equaled $3.6 million, and we had cash on hand at the end of the quarter of $5.8 million.
"We are focused on turning around our U.S. business by sticking to the basics: Reliv makes nutrition simple. Our products can play a role in supporting many thousands of people's efforts to live a healthier life. In addition, we offer distributors an outstanding business opportunity," he added.
Reliv will host a conference call to discuss third-quarter earnings with investors at 1:00 p.m. Eastern Daylight Time on October 29. The dial-in number for investors is 888-680-0869. The participant passcode is 23697341. To register, please call in 15 minutes prior to start of the call. A replay of this call will be available for one week by telephone from 3:00 p.m. Eastern by calling 888-286-8010 and using the passcode 79877419. A live web cast of this call will be available through the Investor Relations section of Reliv's Web site, http://www.reliv.com/US/EN/Conference%20Calls%20Presentations.html.
An online archive of the broadcast will be available on Reliv's Web site in the Investor Relations section 24 hours after the call concludes.
About Reliv
Reliv International, Inc., based in Chesterfield, Mo., is a developer, manufacturer and marketer of a proprietary line of nutritional supplements. Reliv supplements address essential daily nutrition, weight loss and targeted solutions such as energy and performance enhancement, digestive health, women's health and anti-aging. Reliv sells its products through an international network marketing system of approximately 68,500 independent distributors. Additional information about Reliv International, Inc. can be obtained on the Web at www.reliv.com.
Reliv International, Inc. and Subsidiaries
Condensed Consolidated Balance Sheets
September 30 December 31
2008 2007
-------------------------
(Unaudited)
Assets
Current Assets:
Cash and cash
equivalents $ 5,761,294 $11,694,699
Short-term
investments -- 398,592
Accounts and
notes receivable,
less allowances
of $8,400 in
2008 and
$8,300 in 2007 517,051 811,634
Accounts due
from employees
and distributors 241,945 204,705
Inventories 6,782,918 6,179,238
Other current
assets 1,816,976 1,798,932
------------------------
Total current
assets 15,120,184 21,087,800
Other assets 2,804,587 2,999,903
Accounts due
from employees
and distributors 178,391 319,883
Net property,
plant and
equipment 9,115,506 9,199,185
------------------------
Total Assets $27,218,668 $33,606,771
========================
Liabilities and Stockholders' Equity
Total current
liabilities $ 8,520,808 $ 8,574,257
Total non-current
liabilities 956,990 1,227,313
Stockholders'
equity 17,740,870 23,805,201
------------------------
Total Liabilities
and Stockholders'
Equity $27,218,668 $33,606,771
========================
Consolidated Statements of Income
------------------------ ------------------------
Three months ended Nine months ended
September 30 September 30
2008 2007 2008 2007
------------------------ ------------------------
(Unaudited) (Unaudited) (Unaudited) (Unaudited)
Product sales $21,226,975 $22,501,899 $67,719,727 $77,450,784
Handling &
freight income 2,633,832 2,619,260 8,372,176 8,958,556
------------------------ ------------------------
Net Sales 23,860,807 25,121,159 76,091,903 86,409,340
Costs and expenses:
Cost of
products sold 4,464,874 4,320,557 13,410,310 14,780,889
Distributor
royalties and
commissions 9,320,880 9,926,735 29,865,734 34,458,125
Selling,
general and
administrative 8,950,900 9,740,241 28,472,176 30,969,921
------------------------ ------------------------
Total Costs and
Expenses 22,736,654 23,987,533 71,748,220 80,208,935
------------------------ ------------------------
Income from
operations 1,124,153 1,133,626 4,343,683 6,200,405
Other income
(expense):
Interest income 64,329 122,788 299,893 498,904
Interest expense (21,011) (159) (31,405) (732)
Other income
(expense) (211,550) 73,302 (229,139) 268,540
------------------------ ------------------------
Income before
income taxes 955,921 1,329,557 4,383,032 6,967,117
Provision for
income taxes 420,000 429,000 1,752,000 2,623,000
------------------------ ------------------------
Net Income $ 535,921 $ 900,557 $ 2,631,032 $ 4,344,117
======================== ========================
Earnings per
common share -
Basic $ 0.04 $ 0.06 $ 0.17 $ 0.27
======================== ========================
Weighted average
shares 14,806,000 15,938,000 15,498,000 16,166,000
======================== ========================
Earnings per
common share -
Diluted $ 0.04 $ 0.06 $ 0.17 $ 0.27
======================== ========================
Weighted average
shares 14,810,000 16,171,000 15,502,000 16,374,000
======================== ========================
Cash dividends
declared per
common share $ -- $ -- $ 0.05 $ 0.05
======================== ========================
Reliv International, Inc. and Subsidiaries
The following tables summarize net sales by geographic market ranked
by the date we began operations in each market.
Net sales by Market
(in thousands)
Three months ended September 30, Change From
2008 2007 Prior Year
% of % of
Amount sales Amount sales Amount %
---------------- --------------- -----------------
United
States 20,814 87.2% 22,009 87.6% (1,195) -5.4%
Australia
/New
Zealand 667 2.8% 715 2.8% (48) -6.7%
Canada 404 1.7% 378 1.5% 26 6.9%
Mexico 389 1.6% 351 1.4% 38 10.8%
United
Kingdom
/Ireland 234 1.0% 242 1.0% (8) -3.3%
Philippines 583 2.4% 809 3.2% (226) -27.9%
Malaysia
/Singapore 682 2.9% 419 1.7% 263 62.8%
Germany 88 0.4% 198 0.8% (110) -55.6%
---------------- --------------- -----------------
Consolidated
Total 23,861 100.0% 25,121 100.0% (1,260) -5.0%
================ =============== =================
Net sales by Market
(in thousands)
Nine months ended September 30, Change From
2008 2007 Prior Year
% of % of
Amount sales Amount sales Amount %
---------------- --------------- ----------------
United
States 65,934 86.7% 77,215 89.4% (11,281) -14.6%
Australia
/New
Zealand 2,096 2.8% 2,090 2.4% 6 0.3%
Canada 1,301 1.7% 1,196 1.4% 105 8.8%
Mexico 1,269 1.7% 1,155 1.3% 114 9.9%
United
Kingdom
/Ireland 791 1.0% 781 0.9% 10 1.3%
Philippines 2,092 2.7% 2,108 2.4% (16) -0.8%
Malaysia
/Singapore 2,174 2.8% 1,173 1.4% 1,001 85.3%
Germany 435 0.6% 691 0.8% (256) -37.0%
---------------- --------------- ----------------
Consolidated
Total 76,092 100.0% 86,409 100.0% (10,317) -11.9%
================ =============== ================
The following table sets forth, as of September 30, 2008 and 2007,
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 Market
As of As of
9/30/2008 9/30/2007 Change in %
Master Master Master
Affil- Affil- Affil-
Active iates Active iates Active iates
Distri- and Distri- and Distri- and
butors Above butors Above butors Above
--------------- -------------- ----------------
United
States 54,210 10,630 57,420 13,600 -5.6% -21.8%
Australia
/New
Zealand 2,480 230 2,510 280 -1.2% -17.9%
Canada 1,250 160 1,150 160 8.7% 0.0%
Mexico 1,550 240 1,380 220 12.3% 9.1%
United
Kingdom
/Ireland 750 110 790 120 -5.1% -8.3%
Philippines 4,590 420 4,460 370 2.9% 13.5%
Malaysia
/Singapore 3,270 580 2,230 310 46.6% 87.1%
Germany 440 80 560 140 -21.4% -42.9%
--------------- --------------- -----------------
Consolidated
Total 68,540 12,450 70,500 15,200 -2.8% -18.1%
=============== =============== =================