LifeVantage Announces 2015 Revenues Of $190.3 Million

 

LifeVantage Corporation today reported financial results for its fourth quarter and full year ended June 30, 2015.

Fourth Quarter Fiscal 2015 Highlights:

• Revenue was flat at $45.3 million when compared sequentially to $45.2 million for the third fiscal quarter of 2015;
• Revenue in the Americas increased 2.5% and revenue in Asia/Pacific decreased 5.5% on a sequential basis;
• Adjusted EBITDA decreased to $3.1 million, compared to $3.3 million in the third fiscal quarter of 2015;
• Completed implementation of annual cost structure improvements of approximately $4 million.  
    

Full Year Fiscal 2015 Highlights:

• Revenue was $190.3 million compared to $214.0 million for the prior fiscal year;
• Revenue in the Americas decreased 2.2% and revenue in Asia/Pacific decreased 28.2% compared to the prior fiscal year;
• Adjusted EBITDA was $17.4 million compared to $24.5 million for the prior year;
• Reduced long-term debt to $20.7 million at the end of fiscal 2015 from $29.8 million at the end of fiscal 2014;
• Ended fiscal 2015 with $13.9 million of cash and cash equivalents;
• Returned $9.9 million to shareholders by repurchasing 7.6 million shares.

             
Our fourth quarter results reflected stability in our revenue and operating results,” stated LifeVantage President and Chief Executive Officer Darren Jensen. “We strategically implemented $4 million of annualized cost savings in the fourth quarter of fiscal 2015 to better align our cost structure with current sales trends, and position us for stronger EBITDA and net income in fiscal 2016.”

Mr. Jensen continued, “Since I joined the company in May of 2015, we have taken a deliberate approach to reposition LifeVantage for success. We have assembled an executive leadership team with more than 75 years of combined experience and demonstrated success within the direct selling industry. Operationally, we have implemented a proactive plan that focuses on critical aspects of our business, including the utilization of new technologies, brand differentiation, the formulation of new products, and international growth. In the Distributor field, we have a more focused approach designed to engage and ignite our field leadership and our existing Distributors to grow their respective organizations and our company.

When comparing our financial results on a sequential basis, we have already begun stabilizing our top and bottom line results in the first quarter.  We expect that we will begin to see improved results beginning in the back half of fiscal 2016 as our new initiatives begin to take hold across our organization.”

 

Fourth Quarter Fiscal 2015 Results

For the fourth fiscal quarter ended June 30, 2015, the Company reported revenue of $45.3 million, compared to sequential revenue of $45.2 for the third fiscal quarter ended March 31, 2015, and $56.0 million for the same period in fiscal 2014. Year-over-year quarterly revenue reflects a decrease of 15.0% in the Americas and a decrease in the Asia/Pacific region of 29.3%, primarily due to lower sales in Japan. Revenue for the quarter was negatively impacted $2.0 million, or approximately 3.6%, by foreign currency fluctuation.

Commissions and incentives expense for the fourth fiscal quarter of 2015 was $21.7 million, or 47.8% of revenue, compared to $27.0 million, or 48.1% of revenue, in the same period last year. Selling, general and administrative expense (SG&A) for the fourth fiscal quarter of 2015 was $14.8 million, or 32.6% of revenue, compared to $15.3 million, or 27.4% of revenue, in the same period last year. SG&A expense in the fourth fiscal quarter of 2015 includes $0.7 million in one-time expenses related to the engagement of an executive search firm.

Operating income for the fourth fiscal quarter of 2015 was $1.6 million, compared to $4.7 million for the fourth fiscal quarter of 2014. 

Adjusted EBITDA was $3.1 million for the fourth fiscal quarter of 2015, compared to $6.1 million for the prior year period.

Net income for the fourth fiscal quarter of 2015 was $0.2 million, or $0.00 per diluted share, calculated on 96.5 million fully diluted shares.  This compares to net income for the fourth fiscal quarter of 2014 of $2.4 million, or $0.02 per diluted share, calculated on 105.6 million fully diluted shares. 

Fiscal 2015 Full Year Results

For the full year ended June 30, 2015, the Company reported net revenue of $190.3 million, compared to $214.0 million in the prior year. Revenue in the Americas decreased 2.2%, while revenue in Asia Pacific decreased 28.2% due primarily to lower sales in Japan. Revenue for fiscal 2015 was negatively impacted $6.0 million, or 2.8%, by foreign currency fluctuation.

Fiscal Year 2016 Guidance

The Company expects to generate revenue in the range of $195 million to $210 million in fiscal year 2016.  The Company expects its operating margin to be in the range of 8.5% to 10.5% and earnings per diluted share in the range of $0.08 to $0.11, based on an estimated 100 million diluted shares and a 36% effective tax rate.