USANA – Q1 2013 Sales $169 Million Up 9.7%
USANA Health Sciences, Inc. (NYSE: USNA) today announced record financial results for its fiscal first quarter ended March 30, 2013.
Financial Performance
Net sales for the first quarter of 2013 increased by 9.7% to $169.1 million, compared with $154.1 million in the prior-year period. This growth in net sales was driven by increases in both the Companys Asia Pacific and North America/Europe regions. Favorable changes in currency exchange rates also contributed approximately $900,000 to the top line for the quarter.
Net earnings for the first quarter increased to $17.8 million, an improvement of 29.3%, compared with the prior-year period. This increase was due primarily to higher net sales and lower relative Associate incentive expense for the quarter. The relative decrease in Associate incentives expense was attributable to the change to the lifetime matching bonus program, which is now fully implemented.
Earnings per share for the quarter increased by 42.2% to $1.28, compared with $0.90 in the first quarter of the prior year. This improvement in earnings per share was attributable to higher net earnings and a lower number of diluted shares outstanding, which resulted from the Companys share repurchases over the last 12 months. Total diluted common shares outstanding as of March 30, 2013 were 13.9 million, compared with 15.3 million as of March 31, 2012.
The Companys Chief Executive Officer, Dave Wentz, said, For the first quarter of 2013 USANA again delivered record results in sales and earnings per share. During the quarter, our management team continued to execute our strategic initiatives, which are focused on generating worldwide customer growth, growing our Greater China region, advancing our personalization initiatives, and driving new market expansion.
Regional Results
Net sales in Asia Pacific increased by 9.9% to $104.9 million, compared with $95.5 million for the first quarter of the prior year. This improvement was due to strong sales growth in our Greater China and Southeast Asia Pacific regions, which was driven by a 6.3% increase in the number of active Associates in Asia Pacific.
We continue to see solid growth in Asia Pacific, with double-digit local currency growth in several of our markets in that region, continued Mr. Wentz. We remain focused on growing our Greater China region, and are pleased to have received during the quarter government approval in mainland China to expand our direct selling activities in three additional provinces. We continue to be optimistic about our growth opportunity in this region, as we expand our customer base and the reach of our world-class products.
During the first quarter of 2013, net sales in North America/Europe increased by 9.4% to $64.2 million, compared with $58.6 million in the prior-year period. The number of Active Associates in North America/Europe increased 1.3% and the number of Preferred Customers increased 3.8% during the first quarter, compared with the first quarter of 2012.
Mr. Wentz added, We continue to see improvement in our operating trends in North America, particularly in our top-line results. During the quarter, we saw double-digit sales growth in the U.S. and Mexico, as well as strong Associate growth in Mexico. Our focus continues to be on increasing active Associate counts in the U.S. and Canada, and we have several initiatives planned during 2013 to accomplish this objective. We are also excited to announce the addition of Colombia to this region, which we expect to open in the third quarter of 2013. We believe Colombia will be a successful market for USANA and an excellent entry point into South America.
The Company maintained its successful track record of generating meaningful levels of cash from operations and ended the quarter with $71 million in cash and cash equivalents. For the first quarter, cash generated from operations totaled $20.3 million. During the quarter, the Company invested $18.1 million to repurchase 414,000 shares of the Companys common stock.