Nu Skin Enterprises, Inc. (NYSE: NUS) today announced record first-quarter results with revenue of $550.1 million, a 19 percent improvement over the prior-year period.
Revenue was negatively impacted 3 percent by foreign currency fluctuations. Earnings per share for the quarter were $0.90, a 22 percent year-over-year improvement. Additionally, the company announced that it is increasing its full-year 2013 revenue guidance by $190 million to be in the $2.51 to $2.54 billion range.
The new guidance includes a projected negative currency impact of 5 percent. The company now expects 2013 earnings to be in the range of $4.18 to $4.30 per share.
We kicked off the year with tremendous momentum, generating 22 percent local-currency revenue growth this quarter, said Truman Hunt, president and chief executive officer. We are pleased with the overall direction of the business, particularly with trends in the North Asia and Greater China regions.
The first quarter marked the third consecutive quarter of year-over-year local-currency growth for Japan, while South Korea continues to be a solid contributor to our success. Greater China continues to be our fastest-growing region, with each market within the region posting solid quarterly growth.
North Asia. First-quarter revenue in North Asia was $188.2 million, compared to $182.2 million for the same period in 2012. The region's results were negatively impacted 8 percent by foreign currency fluctuations. Japan local-currency revenue improved 13 percent while South Korea generated local-currency revenue growth of 9 percent. The number of sales leaders in the region was up 12 percent while the number of actives improved 8 percent.
Greater China. In Greater China, first-quarter revenue increased 90 percent to $175.7 million, compared to $92.6 million in the prior-year period. The region's results were positively impacted 2 percent by foreign currency fluctuations. Mainland China local-currency revenue grew 141 percent. The sales leader count in the region improved 91 percent, while the number of actives increased 73 percent compared to the prior year.
Americas. Revenue in the Americas improved 15 percent to $76.5 million, compared to $66.3 million in the prior-year period. The region's results were negatively impacted 3 percent by foreign currency fluctuations. U.S. revenue grew by 7 percent during the quarter. The number of sales leaders in the region improved 9 percent while the number of actives decreased 4 percent compared to the prior year.
South Asia/Pacific. Revenue in South Asia/Pacific was $67.2 million, a 13 percent decline compared to the prior year. Excluding the prior-year's product launch sales, revenue would have been up 8 percent. The region's results were not materially impacted by foreign currency fluctuations. The region's first-quarter sales leaders improved 9 percent while actives increased 8 percent compared to the same period in 2012.
EMEA. Revenue in the EMEA region was $42.4 million, a 3 percent decline over the prior-year period. The region's results were not materially impacted by foreign currency fluctuations. Sales leaders and actives increased 1 and 5 percent, respectively, compared to the prior year.
The company's operating margin was 15.0 percent for the quarter, compared to 15.5 percent in the prior year. The decrease in operating margin was primarily a result of planned brand-building efforts in Greater China and Japan as well as increased research and development expenditures. The company projects an operating margin of 15.8 to 16.1 percent for the year. Gross margin during the quarter was 83.6 percent, consistent with the prior year. Selling expenses, as a percent of revenue, were 44.0 percent in the first quarter, compared to 43.8 percent in the prior-year period. General and administrative expenses, as a percent of revenue, were 24.6 percent, up slightly from 24.3 percent reported in the prior-year period. Other income (expense), net reflected a gain of $0.1 million compared to a gain of $3.6 million in the prior year.
The company's income tax rate for the quarter was 34.4 percent compared to 36.5 percent in the prior-year period. The company's cash and short-term investment position at the end of the quarter was $334.3 million. Dividend payments during the quarter were $17.5 million, and the company repurchased $14.6 million of its outstanding shares.
Given the positive momentum of the business, we are on track to achieve another record year of revenue and earnings, said Hunt. Our anti-aging product portfolio continues to drive strong consumer demand and impressive growth in our global sales force.
The ageLOC product platform has become a game-changer for Nu Skin, and we believe this fall's introduction of the ageLOC weight management system will be a meaningful growth driver in our business. We are currently training and preparing our sales force for the limited-time-offer in the second half of the year, and believe the launch will be the largest in company history, Hunt concluded.
Given the strength of our business, as well as the optimism we have for the upcoming ageLOC weight management system, we are significantly raising our 2013 guidance, said Ritch Wood, chief financial officer. Our increased guidance accounts for a stronger-than-expected currency headwind, which we now forecast will negatively impact revenue for the year by approximately 5 percent, an increase of 1 to 2 percent from our previous guidance. We project second-quarter 2013 revenue to be in the $570 to $580 million range with a negative currency impact of 4 to 5 percent, and earnings per share to be $0.91 to $0.95. For the full year, we anticipate revenue will be in the $2.51 to $2.54 billion range with earnings per share to be $4.18 to $4.30.
The company's management will host a webcast with the investment community on May 2, 2013, at 11 a.m. EST. Those wishing to access the webcast, as well as the financial information presented during the call, can visit the Investor Relations page on Nu Skin Enterprises' website, https://ir.nuskin.com. An archive of the webcast will be available at this same URL through May 17, 2013.
About Nu Skin Enterprises, Inc.
Nu Skin Enterprises, Inc. demonstrates its tradition of innovation through its comprehensive anti-aging product portfolio, independent business opportunity and corporate social responsibility initiatives. The company's scientific leadership in both skin care and nutrition has established Nu Skin as a premier anti-aging company.
The company's anti-aging products feature the new ageLOC® suite of products including the ageLOC® R2 nutritional supplement, ageLOC® Galvanic Spa System and ageLOC® Galvanic Body Spa™, as well as the ageLOC® Transformation daily skin care system. A global direct selling company, Nu Skin operates in 53 markets worldwide and is traded on the New York Stock Exchange under the symbol NUS. More information is available at https://www.nuskin.com.
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