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Nu Skin (NUS) Q1 Earnings Beat, Revenues Hurt by Currency Woes
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Nu Skin Enterprises, Inc. (NUS - Free Report) posted first-quarter 2024 results, wherein both the top and bottom lines declined year over year, and revenues missed the Zacks Consensus Estimate. Foreign currency headwinds had a greater-than-anticipated impact on revenues. However, the company’s diligent cost management efforts aided its bottom-line performance.
Nu Skin is actively pursuing business transformation initiatives and advancing its integrated beauty, wellness and lifestyle ecosystem. While macroeconomic challenges hurt the affiliate and customer growth globally in the Nu Skin core business, the company saw notable gains in the Rhyz business. Key product launches such as ageLOC WellSpa iO, RenuSpa iO, and TRMe also performed well.
Amid the ongoing business transformation challenges in the current disruptive landscape, Nu Skin remains steadfast in evolving strategies for both Nu Skin and Rhyz businesses, prioritizing long-term growth and delivering shareholder value.
Quarter in Detail
Nu Skin posted adjusted earnings of 9 cents a share, excluding restructuring. The metric declined from the adjusted figure of 37 cents reported in the year-ago quarter. However, the bottom line surpassed the Zacks Consensus Estimate of 5 cents.
Nu Skin Enterprises, Inc. Price, Consensus and EPS Surprise
Revenues of $417.3 million tumbled 13.3% year over year. Revenues included a negative impact of 3.8% from foreign currency fluctuations. On a constant currency basis, revenues fell 9.5%. Rhyz revenues grew substantially by about 60% year over year. Nu Skin’s top line fell short of the Zacks Consensus Estimate of $431 million.
Sales leaders were down 12% year over year to 38,609. Nu Skin’s customer base dropped 19% to 875,261. The company’s paid affiliates were down 30% to 154,171. On an adjusted basis, paid affiliates tumbled 14%.
The gross profit of $294.1 million declined from the $347.9 million reported in the year-ago quarter. The gross margin came in at 70.5%, down from the 72.3% reported in the year-ago quarter. The Nu Skin business’ gross margin came in at 76.9%, up from the 76.4% reported in the year-ago quarter.
Selling expenses declined to $153.5 million from the $188.1 million reported in the prior-year quarter. As a percentage of revenues, the metric was 36.8%, down from the 39.1% reported in the year-ago quarter. Nu Skin business’ selling expenses were 41.7%, in line with the prior-year quarter.
General and administrative expenses of $124.6 million decreased from $133.9 million in the year-ago quarter. As a percentage of revenues, general and administrative expenses were 29.9%, up from 27.8% in the year-ago period.
The company’s adjusted operating margin (excluding restructuring charges) contracted 160 basis points to 3.8%.
Regional Results
Region-wise, revenues (at cc) declined 20.1%, 6.1%, 8.1%, 5.6%, 11.8%, 39.3% and 9.8% in the Americas, Mainland China, Southeast Asia/Pacific, Japan, Europe & Africa, South Korea and Hong Kong/Taiwan, respectively. Meanwhile, Nu Skin’s other revenues surged 684.3% year over year.
Other Financial Details
Nu Skin ended the quarter with cash and cash equivalents of $212.5 million, long-term debt of $453.2 million and total stockholders' equity of $810.2 million. In the reported quarter, the company paid out dividends of $3 million while not making any share repurchases. NUS has $162.4 million remaining under the current share repurchase authorization.
Guidance
Nu Skin remains focused on undertaking strategic measures to optimize its cost structure in alignment with business performance. It also continues to prioritize revenue-driving initiatives, margin amplification and financial security. While adverse foreign currency effects were more pronounced than initially anticipated and are expected to persist, Nu Skin reiterated its 2024 revenue and adjusted EPS guidance.
Nu Skin anticipates revenues in the band of $1.73-$1.87 billion for 2024, which suggests a 12-5% decline from the year-ago period’s reported figure. The company envisions unfavorable foreign currency impacts of 3-2% on 2024 revenues.
Management envisions an adjusted EPS of 95 cents to $1.35. The projection suggests a decline from adjusted earnings of $1.85 recorded in 2023. On a reported basis, management anticipates earnings in the range of 77 cents-$1.16 per share compared with 17 cents delivered in 2023.
For the second quarter of 2024, Nu Skin expects revenues between $420 million and $455 million, including an unfavorable foreign currency impact of nearly 4% to 3%. The revenue projection suggests a decline of 16% to 9% from the year-ago quarter’s reported level. The company expects adjusted earnings of 10-20 cents a share. On a reported basis, NUS expects earnings between 1 and 10 cents per share for the second quarter.
Shares of this Zacks Rank #3 (Hold) company have declined 29.4% in the past three months compared with the industry’s decrease of 10.4%.
Better-Ranked Staple Bets
Here, we have highlighted three better-ranked stocks, namely Tyson Foods, Inc. (TSN - Free Report) , Hormel Foods (HRL - Free Report) and Beyond Meat (BYND - Free Report) .
Tyson Foods, which operates through Beef, Pork, Chicken and Prepared Foods segments, currently sports a Zacks Rank #1 (Strong Buy). TSN delivered a positive earnings surprise of 24.4% in the trailing four quarters, on average. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for Tyson Foods’ current fiscal-year earnings calls for growth of 76.1% from the year-ago reported numbers.
Hormel Foods develops, processes and distributes various meat, nuts and other food products. It currently carries a Zacks Rank #2 (Buy). HRL has a trailing four-quarter earnings surprise of 3.5%, on average.
The Zacks Consensus Estimate for Hormel Foods’ current financial-year sales suggests growth of 1.2% from the year-ago reported number.
Beyond Meat, which develops, manufactures, markets and sells plant-based meat products, currently carries a Zacks Rank #2. The Zacks Consensus Estimate for BYND’s current fiscal year bottom line has improved from a loss of $2.46 to a loss of $2.29 in the past 30 days.
The Zacks Consensus Estimate for Beyond Meat’s current financial-year earnings implies growth of 39.4% from the year-ago reported number.
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Nu Skin (NUS) Q1 Earnings Beat, Revenues Hurt by Currency Woes
Nu Skin Enterprises, Inc. (NUS - Free Report) posted first-quarter 2024 results, wherein both the top and bottom lines declined year over year, and revenues missed the Zacks Consensus Estimate. Foreign currency headwinds had a greater-than-anticipated impact on revenues. However, the company’s diligent cost management efforts aided its bottom-line performance.
Nu Skin is actively pursuing business transformation initiatives and advancing its integrated beauty, wellness and lifestyle ecosystem. While macroeconomic challenges hurt the affiliate and customer growth globally in the Nu Skin core business, the company saw notable gains in the Rhyz business. Key product launches such as ageLOC WellSpa iO, RenuSpa iO, and TRMe also performed well.
Amid the ongoing business transformation challenges in the current disruptive landscape, Nu Skin remains steadfast in evolving strategies for both Nu Skin and Rhyz businesses, prioritizing long-term growth and delivering shareholder value.
Quarter in Detail
Nu Skin posted adjusted earnings of 9 cents a share, excluding restructuring. The metric declined from the adjusted figure of 37 cents reported in the year-ago quarter. However, the bottom line surpassed the Zacks Consensus Estimate of 5 cents.
Nu Skin Enterprises, Inc. Price, Consensus and EPS Surprise
Nu Skin Enterprises, Inc. price-consensus-eps-surprise-chart | Nu Skin Enterprises, Inc. Quote
Revenues of $417.3 million tumbled 13.3% year over year. Revenues included a negative impact of 3.8% from foreign currency fluctuations. On a constant currency basis, revenues fell 9.5%. Rhyz revenues grew substantially by about 60% year over year. Nu Skin’s top line fell short of the Zacks Consensus Estimate of $431 million.
Sales leaders were down 12% year over year to 38,609. Nu Skin’s customer base dropped 19% to 875,261. The company’s paid affiliates were down 30% to 154,171. On an adjusted basis, paid affiliates tumbled 14%.
The gross profit of $294.1 million declined from the $347.9 million reported in the year-ago quarter. The gross margin came in at 70.5%, down from the 72.3% reported in the year-ago quarter. The Nu Skin business’ gross margin came in at 76.9%, up from the 76.4% reported in the year-ago quarter.
Selling expenses declined to $153.5 million from the $188.1 million reported in the prior-year quarter. As a percentage of revenues, the metric was 36.8%, down from the 39.1% reported in the year-ago quarter. Nu Skin business’ selling expenses were 41.7%, in line with the prior-year quarter.
General and administrative expenses of $124.6 million decreased from $133.9 million in the year-ago quarter. As a percentage of revenues, general and administrative expenses were 29.9%, up from 27.8% in the year-ago period.
The company’s adjusted operating margin (excluding restructuring charges) contracted 160 basis points to 3.8%.
Regional Results
Region-wise, revenues (at cc) declined 20.1%, 6.1%, 8.1%, 5.6%, 11.8%, 39.3% and 9.8% in the Americas, Mainland China, Southeast Asia/Pacific, Japan, Europe & Africa, South Korea and Hong Kong/Taiwan, respectively. Meanwhile, Nu Skin’s other revenues surged 684.3% year over year.
Other Financial Details
Nu Skin ended the quarter with cash and cash equivalents of $212.5 million, long-term debt of $453.2 million and total stockholders' equity of $810.2 million. In the reported quarter, the company paid out dividends of $3 million while not making any share repurchases. NUS has $162.4 million remaining under the current share repurchase authorization.
Guidance
Nu Skin remains focused on undertaking strategic measures to optimize its cost structure in alignment with business performance. It also continues to prioritize revenue-driving initiatives, margin amplification and financial security. While adverse foreign currency effects were more pronounced than initially anticipated and are expected to persist, Nu Skin reiterated its 2024 revenue and adjusted EPS guidance.
Nu Skin anticipates revenues in the band of $1.73-$1.87 billion for 2024, which suggests a 12-5% decline from the year-ago period’s reported figure. The company envisions unfavorable foreign currency impacts of 3-2% on 2024 revenues.
Management envisions an adjusted EPS of 95 cents to $1.35. The projection suggests a decline from adjusted earnings of $1.85 recorded in 2023. On a reported basis, management anticipates earnings in the range of 77 cents-$1.16 per share compared with 17 cents delivered in 2023.
For the second quarter of 2024, Nu Skin expects revenues between $420 million and $455 million, including an unfavorable foreign currency impact of nearly 4% to 3%. The revenue projection suggests a decline of 16% to 9% from the year-ago quarter’s reported level. The company expects adjusted earnings of 10-20 cents a share. On a reported basis, NUS expects earnings between 1 and 10 cents per share for the second quarter.
Shares of this Zacks Rank #3 (Hold) company have declined 29.4% in the past three months compared with the industry’s decrease of 10.4%.
Better-Ranked Staple Bets
Here, we have highlighted three better-ranked stocks, namely Tyson Foods, Inc. (TSN - Free Report) , Hormel Foods (HRL - Free Report) and Beyond Meat (BYND - Free Report) .
Tyson Foods, which operates through Beef, Pork, Chicken and Prepared Foods segments, currently sports a Zacks Rank #1 (Strong Buy). TSN delivered a positive earnings surprise of 24.4% in the trailing four quarters, on average. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for Tyson Foods’ current fiscal-year earnings calls for growth of 76.1% from the year-ago reported numbers.
Hormel Foods develops, processes and distributes various meat, nuts and other food products. It currently carries a Zacks Rank #2 (Buy). HRL has a trailing four-quarter earnings surprise of 3.5%, on average.
The Zacks Consensus Estimate for Hormel Foods’ current financial-year sales suggests growth of 1.2% from the year-ago reported number.
Beyond Meat, which develops, manufactures, markets and sells plant-based meat products, currently carries a Zacks Rank #2. The Zacks Consensus Estimate for BYND’s current fiscal year bottom line has improved from a loss of $2.46 to a loss of $2.29 in the past 30 days.
The Zacks Consensus Estimate for Beyond Meat’s current financial-year earnings implies growth of 39.4% from the year-ago reported number.