NATURAL HEALTH TRENDS CORP.
CONSOLIDATED BALANCE SHEETS
(In Thousands, Except Share Data)
December 31,
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2006 2007
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ASSETS
Current assets:
Cash and cash equivalents $ 11,936 $ 6,282
Restricted cash 455 298
Certificates of deposit 1,277 -
Accounts receivable 462 418
Inventories, net 5,857 3,585
Other current assets 2,639 1,324
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Total current assets 22,626 11,907
Property and equipment, net 2,944 1,537
Goodwill 14,145 1,764
Intangible assets, net 3,400 2,600
Restricted cash 3,503 4,317
Deferred tax assets 208 208
Other assets 1,759 2,363
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Total assets $ 48,585 $ 24,696
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LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable $ 3,424 $ 2,168
Income taxes payable 281 363
Accrued distributor commissions 3,852 2,018
Other accrued expenses 5,255 3,599
Deferred revenue 5,641 3,496
Current portion of convertible debentures, net
of discount of $151 - 203
Other current liabilities 3,135 3,254
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Total current liabilities 21,588 15,101
Convertible debentures, net of discount of $3,896 - -
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Total liabilities 21,588 15,101
Commitments and contingencies
Minority interest 22 33
Stockholders' equity:
Preferred stock, $0.001 par value; 5,000,000
shares authorized; 1,761,900 shares
designated Series A convertible preferred
stock, 138,400 shares issued and outstanding
at December 31, 2007, aggregate liquidation
value of $246 - 124
Common stock, $0.001 par value; 50,000,000
shares authorized; 8,199,933 and 10,327,405
shares issued and outstanding at December 31,
2006 and 2007, respectively 8 10
Additional paid-in capital 70,042 79,158
Accumulated deficit (44,128) (70,989)
Accumulated other comprehensive income:
Foreign currency translation adjustments 1,053 1,259
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Total stockholders' equity 26,975 9,562
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Total liabilities and stockholders' equity $ 48,585 $ 24,696
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NATURAL HEALTH TRENDS CORP.
CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)
(In Thousands, Except Per Share Data)
Three Months Ended Twelve Months Ended
December 31, December 31,
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2006 2007 2006 2007
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Net sales $ 27,688 $ 12,977 $ 133,428 $ 76,501
Cost of sales 9,647 3,731 33,066 20,290
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Gross profit 18,041 9,246 100,362 56,211
% of net sales 65.2% 71.2% 75.2% 73.5%
Operating expenses:
Distributor commissions 13,363 4,908 68,265 35,095
% of net sales 48.3% 37.8% 51.2% 45.9%
Selling, general and
administrative expenses 11,367 7,352 45,735 34,524
Impairment of goodwill - 12,381 - 12,381
Recovery of KGC
receivable (753) - (1,405) (565)
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Total operating expenses 23,977 24,641 112,595 81,435
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Loss from operations (5,936) (15,395) (12,233) (25,224)
Other income (expense), net 250 (159) 946 143
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Loss before income taxes
and minority interest (5,686) (15,554) (11,287) (25,081)
Income tax provision 606 260 (182) (200)
Minority interest 44 1 9 (6)
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Net loss (5,036) (15,293) (11,460) (25,287)
Beneficial conversion
feature on preferred stock - - - (1,574)
Preferred stock dividends - (21) - (91)
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Net loss attributable to
common stockholders $ (5,036) $ (15,314) $ (11,460) $ (26,952)
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Loss per share - basic and
diluted $ (0.61) $ (1.62) $ (1.42) $ (3.15)
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Weighted-average number of
shares outstanding 8,200 9,447 8,079 8,555
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Contact Information: Contact: Jean Bono Natural Health Trends Corp.