Natural Health Trends Corp. (NASDAQ: NHTC), a leading direct-selling and e-commerce company that markets premium quality personal care, wellness and “quality of life” products under the NHT Global brand, today announced its financial results for the fourth quarter and full year ended December 31, 2019.
Fourth Quarter 2019 Financial Highlights
- Revenue of $17.8 million decreased 57% compared to $41.6 million in the fourth quarter of 2018. Revenue increased 5% compared to $17.0 million in the third quarter of 2019.
- Operating loss was $3.2 million compared to operating income of $5.7 million in the fourth quarter of 2018. Operating loss for the fourth quarter of 2019 included an impairment charge of $1.8 million upon the early adoption of a new accounting standard pertaining to goodwill that arose from a merger transaction in March 2004.
- Net loss was $2.8 million, or $0.27 per diluted share, compared to net income of $5.6 million, or $0.49 per diluted share, in the fourth quarter of 2018.
- The number of Active Members¹ decreased 16% to 57,410 at December 31, 2019, compared to 68,150 at September 30, 2019, and decreased 41% compared to 97,840 at December 31, 2018.¹ Natural Health Trends defines Active Members as those that have placed at least one product order with the Company during the preceding twelve-month period.
Full Year 2019 Financial Highlights
- Revenue of $77.6 million decreased 60% compared to $191.9 million in 2018.
- Operating loss was $7.0 million compared to operating income of $33.7 million in 2018. Operating loss included a goodwill impairment charge of $1.8 million in 2019.
- Net loss was $5.6 million, or $0.52 per diluted share, compared to net income of $31.0 million, or $2.74 per diluted share, in 2018.
“2019 was a challenging year for our business amid a host of macroeconomic and industry-specific factors that created a highly difficult operating environment,” commented Chris Sharng, President of Natural Health Trends Corp.
“In addition to China’s 100 day campaign announced last January and negative sentiment stemming from social media as it relates to health products companies in China, additional developments such as ongoing global trade tensions, China’s slowing economy and civil unrest in Hong Kong further contributed to the decline in revenue for 2019. That said, order volume in the fourth quarter of 2019 increased 12% over the prior quarter as a result of our successful event in Macau, along with a positive response to our various product promotions and incentives.”
Mr. Sharng further commented,
“While our first quarter results are typically affected by the Chinese New Year, the coronavirus outbreak and the unprecedented measures to control it are posing further challenges to the market.
Following the extended Chinese New Year holidays, we plan to rely on product promotions and webcast training to overcome physical restrictions. We are continuing to monitor the evolving situation closely and will adapt our marketing programs accordingly. Looking ahead, we have implemented a strategy to more effectively manage elements within our control including: ensuring our incentives remain attractive to our leaders and member base; continuing to expand our operations into new geographies; and reducing our cost structure. To that end, we expect to achieve annualized cost savings of approximately $6.5 million in 2020.”
About Natural Health Trends Corp.
Natural Health Trends Corp. (NASDAQ: NHTC) is an international direct-selling and e-commerce company operating through its subsidiaries throughout Asia, the Americas, and Europe. The Company markets premium quality personal care products under the NHT Global brand. Additional information can be found on the Company’s website at www.naturalhealthtrendscorp.com.
Get more information, facts and figures about NHT Global, click here for the NHT Global overview.