CHESTERFIELD, Mo., Oct. 31, 2007 (PRIME NEWSWIRE) -- Reliv International, Inc. (Nasdaq:RELV), maker of a proprietary line of soy-based nutritional supplements, today reported net sales for the third quarter of $25.1 million, compared to $29.8 million in the same quarter last year.
Net income for the third quarter equaled $900,557 or $0.06 per diluted share, compared to net income of $1.8 million or $0.11 per diluted share in the third quarter of 2006. Reliv reported U.S. sales of $22.0 million for the third quarter, compared to $26.8 million for the year-ago quarter. International net sales rose 3.9 percent to $3.1 million for the third quarter.
For the first nine months of 2007, net sales equaled $86.4 million compared to net sales of $88.8 million in the first nine months of 2006. Net income for the period was $4.3 million or $0.27 per diluted share compared to $5.9 million or $0.35 per diluted share last year.
The number of new distributors signing up with Reliv in the third quarter was comparable to the number from the third quarter last year. For the first nine months of this year, sponsorship has risen approximately 13 percent above the sponsorship level for the same period in 2006.
"We are pleased that our distributor growth strategy is on track as sponsorship numbers remain up for the year, but our overall performance was not satisfactory," said Robert L. Montgomery, chairman, president and chief executive officer. "Compared to last year, the number of distributors reaching the Master Affiliate level has declined, leading to a drop in the average order size. Our focus now must be on generating sales growth," he said.
"With that in mind, Reliv has launched a number of sales initiatives," he added. "At our International Conference in August, we re-introduced the July 2006 Success from Home magazine, which prominently features Reliv. Since the conference, our U.S. distributors have used the magazine more effectively than they did after the initial launch of the publication in 2006, and we believe their efforts will play a role in boosting sales," Montgomery said.
Reliv also initiated a new sales promotion, called "Live the Dream," at the International Conference. "This promotion rewards our top sales and sponsoring distributors in North America each month with bonuses and a luxury vacation in 2008. In addition, Reliv will celebrate its 20th anniversary next year, and we will be promoting that celebration as a way to build sales and sponsorship," Montgomery said.
During the third quarter, the company completed its revised distributor training by introducing a new module for Master Affiliates. "The new training is designed to show Master Affiliates how to continue building their businesses in order to reap greater financial rewards. We demonstrate that the most effective way to build their income is to teach their recruits to become Master Affiliates," he said.
Earlier this year, Reliv introduced an improved basic training for new distributors, teaching them how to build their business to the Master Affiliate level.
The fourth quarter also marks national sales conferences in Reliv's international markets. Earlier this month, the Australia/New Zealand region held its annual conference and a European regional conference was held in Germany, the largest sales event ever for Reliv in Europe. Approximately 100 of the top U.S. distributors were in attendance at the European meeting. In November, the Malaysia/Singapore and Mexico regions will hold their national conferences.
"The basics for our success remain the same," Montgomery said. "Reliv makes nutrition simple with outstanding nutritional supplements and we offer individuals an outstanding business opportunity. Reliv will continue to invest in initiatives to increase retail sales, expand our distributor ranks and support their efforts to succeed," he added.
Reliv will host a conference call to discuss the third quarter 2007 earnings with investors at 1:00 p.m. Eastern Time on October 31, 2007. The dial-in number for investors is 800-599-9795. The participant passcode is 64095026. 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 10850380. 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 suburban St. Louis, Mo., is a developer, manufacturer and marketer of a proprietary line of nutritional supplements addressing basic nutrition, specific wellness needs, weight management and sports nutrition. Reliv sells its products through an international network marketing system of approximately 70,500 independent distributors. Additional information about Reliv International, Inc. can be obtained on the Web at www.reliv.com.
Reliv International, Inc. and Subsidiaries
ADD ONE
Condensed Consolidated Balance Sheets
September 30 December 31
2007 2006
------------------------
(Unaudited)
Assets
Current Assets:
Cash and cash equivalents $ 7,723,550 $ 9,332,810
Short-term investments 4,398,592 7,864,000
Accounts and notes receivable, less
allowances of $6,600 in 2007 and $6,200
in 2006 560,821 669,379
Accounts due from employees and
distributors 270,337 223,246
Inventories 5,716,140 4,778,221
Other current assets 2,488,201 1,977,522
------------------------
Total current assets 21,157,641 24,845,178
Other assets 2,993,114 2,639,537
Accounts due from employees and
distributors 335,056 362,959
Net property, plant and equipment 9,414,792 9,434,546
------------------------
Total Assets $33,900,603 $37,282,220
========================
Liabilities and Stockholders' Equity
Total current liabilities $ 8,932,233 $ 8,615,256
Total non-current liabilities 1,124,580 933,113
Stockholders' equity 23,843,790 27,733,851
------------------------
Total Liabilities and Stockholders'
Equity $33,900,603 $37,282,220
========================
Consolidated Statements of Income
------------------------ ------------------------
Three months ended Nine months ended
September 30 September 30
2007 2006 2007 2006
------------------------ ------------------------
(Unaudited) (Unaudited) (Unaudited) (Unaudited)
Product sales $22,501,899 $26,779,859 $77,450,784 $79,812,178
Handling &
freight
income 2,619,260 2,999,544 8,958,556 9,011,644
------------------------ ------------------------
Net Sales 25,121,159 29,779,403 86,409,340 88,823,822
Costs and
expenses:
Cost of
products
sold 4,320,557 4,951,293 14,780,889 14,756,297
Distributor
royalties
and
commissions 9,926,735 11,923,943 34,458,125 35,707,259
Selling,
general and
administrative 9,740,241 10,211,813 30,969,921 29,163,430
------------------------ ------------------------
Total Costs
and Expenses 23,987,533 27,087,049 80,208,935 79,626,986
------------------------ ------------------------
Income from
operations 1,133,626 2,692,354 6,200,405 9,196,836
Other income
(expense):
Interest income 122,788 197,998 498,904 480,120
Interest
expense (159) (1,961) (732) (47,428)
Other income 73,302 83,720 268,540 182,239
------------------------ ------------------------
Income before
income taxes 1,329,557 2,972,111 6,967,117 9,811,767
Provision for
income taxes 429,000 1,168,000 2,623,000 3,937,000
------------------------ ------------------------
Net Income $ 900,557 $ 1,804,111 $ 4,344,117 $ 5,874,767
======================== ========================
Earnings per
common share
- Basic $ 0.06 $ 0.11 $ 0.27 $ 0.36
======================== ========================
Weighted
average
shares 15,938,000 16,919,000 16,166,000 16,390,000
======================== ========================
Earnings per
common share
- Diluted $ 0.06 $ 0.11 $ 0.27 $ 0.35
======================== ========================
Weighted
average
shares 16,171,000 17,050,000 16,374,000 16,712,000
======================== ========================
Cash dividends
declared per
common share $ -- $ -- $ 0.05 $ 0.05
======================== ========================
Reliv International, Inc. and Subsidiaries
ADD TWO
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,
2007 2006 Change From
% of % of Prior Year
Amount sales Amount sales Amount %
United ---------------- ---------------- ----------------
States 22,009 87.6% 26,784 89.9% (4,775) -17.8%
Australia/
New Zealand 715 2.8% 701 2.4% 14 2.0%
Canada 378 1.5% 414 1.4% (36) -8.7%
Mexico 351 1.4% 367 1.2% (16) -4.4%
United
Kingdom/
Ireland 242 1.0% 323 1.1% (81) -25.1%
Philippines 809 3.2% 594 2.0% 215 36.2%
Malaysia/
Singapore 419 1.7% 382 1.3% 37 9.7%
Germany 198 0.8% 214 0.7% (16) -7.5%
---------------- ---------------- ----------------
Consolidated
Total 25,121 100.0% 29,779 100.0% (4,658) -15.6%
================ ================ ================
Nine months ended September 30,
2007 2006 Change From
% of % of Prior Year
Amount sales Amount sales Amount %
---------------- ---------------- ----------------
United
States 77,215 89.4% 80,376 90.5% (3,161) -3.9%
Australia/
New Zealand 2,090 2.4% 1,855 2.1% 235 12.7%
Canada 1,196 1.4% 1,234 1.4% (38) -3.1%
Mexico 1,155 1.3% 1,011 1.1% 144 14.2%
United
Kingdom/
Ireland 781 0.9% 915 1.0% (134) -14.6%
Philippines 2,108 2.4% 1,602 1.8% 506 31.6%
Malaysia/
Singapore 1,173 1.4% 1,297 1.5% (124) -9.6%
Germany 691 0.8% 534 0.6% 157 29.4%
---------------- ---------------- ----------------
Consolidated
Total 86,409 100.0% 88,824 100.0% (2,415) -2.7%
================ ================ ================
The following table sets forth, as of September 30, 2007 and 2006,
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 9/30/2007 As of 9/30/2006 Change in %
Master Master Master
Affiliates Affiliates Affiliates
Active and Active and Active and
Distributors Above Distributors Above Distributors Above
------------------- ------------------- -------------------
United
States 57,420 13,600 52,760 15,660 8.8% -13.2%
Australia/
New
Zealand 2,510 280 2,420 270 3.7% 3.7%
Canada 1,150 160 1,170 180 -1.7% -11.1%
Mexico 1,380 220 1,130 220 22.1% 0.0%
United
Kingdom/
Ireland 790 120 910 150 -13.2% -20.0%
Philippines 4,460 370 3,360 350 32.7% 5.7%
Malaysia/
Singapore 2,230 310 2,750 380 -18.9% -18.4%
Germany 560 140 320 110 75.0% 27.3%
------------------- ------------------- -------------------
Consoli-
dated
Total 70,500 15,200 64,820 17,320 8.8% -12.2%
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