Mannatec Reports 2015 Q2 Net Sales – Up 1% To $46.7 Million
Mannatech, Incorporated, the pioneer of nutritional glycobiology, leading innovator of naturally-sourced supplements based on Real Food Technology® solutions, and creator of the M5MSM (Mission 5 MillionSM) social entrepreneurial movement, today announced financial results for its second quarter 2015.
Second quarter net sales for 2015 were $46.7 million, an increase of 0.9% as compared to $46.3 million in the second quarter of 2014. The net sales comparison for the quarter was affected by the loyalty program and foreign exchange. The loyalty program increased second quarter 2015 net sales by $3.2 million, as compared to the same period in 2014.
Our net sales increased 7.6% in constant dollars, which is a non-GAAP financial measure that excludes the impact of fluctuations in foreign currency exchange rates. Cost of sales was $8.3 million, a decrease of 15.1% as compared to $9.7 million in the second quarter of 2014. This decrease was due to the impact of foreign exchange and a smaller charge for obsolete inventory of $0.1 million during the second quarter, compared to a charge of $0.8 million during the same period in 2014.
Commissions and incentives were $18.9 million, a decrease of 4.5% as compared to $19.8 million in the second quarter of 2014 when we paid commissions associated with launched and pre-launch activities in the Asia/Pacific region. We recognized $2.8 million in revenue related to these activities during the third quarter of 2014.
Net income was $3.1 million, or $1.15 per diluted share, for the second quarter 2015, as compared to net loss of $0.7 million, or $0.26 per diluted share, for the second quarter 2014.
For the three months ended June 30, 2015, our operations outside of North America accounted for approximately 59.7% of our consolidated net sales.
For the three months ended June 30, 2015, Asia/Pacific net sales increased by $2.2 million, or 10.3%, to $23.6 million, as compared to $21.4 million for the same period in 2014 due to growth in the number of active members and growth in the revenue per active associate and member. In constant dollars, net sales would have increased 21.0% to $25.9 million; the currency impact was primarily due to the Korean won, Japanese yen and Australian dollar.
For the three months ended June 30, 2015, EMEA net sales increased by $0.3 million, or 7.5%, to $4.3 million, as compared to $4.0 million for the same period in 2014. Increases in active associates were partially offset by decreases in revenue per active associate and member. In constant dollars, net sales would have increased 25.0% to $5.0 million; the currency impact was primarily due to depreciation of the South Africa rand and the euro.
North American net sales decreased by $2.1 million, or 10.0%, to $18.8 million, as compared to $20.9 million for the same period in 2014 due to a decline in active associates and members.
New associates for the quarter increased 10.2% compared to the same period in the prior year. This was offset by a decrease in new members resulting in recruiting of new independent associates and members decreasing 18.7% in the second quarter 2015 as compared to the second quarter of 2014. The number of new independent associates and members for the second quarter of 2015 was approximately 25,600, as compared to 31,500 in 2014. The total number of independent associates and members based on a 12-month trailing period was approximately 228,000 as of June 30, 2015, as compared to 239,000 as of June 30, 2014. Packs purchased by independent associates to build their business were up 21.9% for the quarter to $8.9 million.
Mannatech, Incorporated, develops high-quality health, weight and fitness, and skin care products that are based on the solid foundation of nutritional science and development standards.
Mannatech is dedicated to its platform of Social Entrepreneurship based on the foundation of promoting, aiding and optimizing nutrition where it is needed most around the world.
Mannatech’s proprietary products are available through independent sales Associates around the globe including the United States, Canada, South Africa, Australia, New Zealand, Austria, Denmark, Germany, Norway, Sweden, the Netherlands, the United Kingdom, Japan, Taiwan, Singapore, Estonia, Finland, the Republic of Ireland, Czech Republic, the Republic of Korea, Mexico, Namibia, Spain and Hong Kong. For more information, visit Mannatech.com.
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