NATURAL HEALTH TRENDS ANNOUNCES SEC FILINGS AND FINANCIAL RESULTS

DALLAS, TX, November 14, 2011 -- Natural Health Trends Corp. (Pink Sheets: NHTC) announced today that it has filed with the Securities and Exchange Commission periodic reports covering periods ended after September 30, 2009, including a comprehensive Annual Report on Form 10-K for each of the fiscal years ended December 31, 2009 and 2010 (in lieu of filing separate reports for each of those years), and separate Quarterly Reports on Form 10-Q for each of the quarters ended March 31, 2011 through September 30, 2011.  The Company does not intend to file separate Quarterly Reports on Form 10-Q for any of the quarters ended March 31, 2010 through September 30, 2010, because that information is included in the comprehensive Annual Report.
 
Focusing on its most recent results, the Company announced $1.8 million of net income, or $0.17 income per share, on $22.9 million of sales during the first nine months of 2011, compared to $2.1 million of net loss, or $0.20 loss per share, on $17.4 million during the comparable period in 2010.   Year on year sales increased 32%, while selling, general and administrative expenses decreased 15%.   
Chris Sharng, president of Natural Health Trends, said, “In the last two years, we have completely changed our culture and re-built a competitive business model based on dedicated field leaders, enhanced commission structure, systemic training, attentive services, effective promotions and high-quality products.  Our operating costs are way down after aggressive restructuring and will enable us to benefit from revived revenue, particularly in Greater China.”  
“The third quarter’s results were bolstered by our 10th anniversary celebration and shipments of orders received in the prior quarter.  Our business is still expected to be significantly influenced by seasonality factors, such as the Chinese New Year, the Chinese Golden Week (in early October) and the summertime.  The cash we generate will have to be re-invested in the business to support existing operations and pursue opportunities we have in our markets.”

About Natural Health Trends Corp.

Natural Health Trends Corp. is an international direct-selling and e-commerce company operating through its subsidiaries throughout Asia, North America, 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, and management encourages interested parties to register for updated corporate information via email on the company’s home page, www.naturalhealthtrendscorp.com.

Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995 -- Forward-looking statements in this release do not constitute guarantees of future performance.  Such forward-looking statements are subject to risks and uncertainties that could cause our actual results to differ materially from those anticipated.  Such risks and uncertainties include the risks and uncertainties detailed under the caption “Risk Factors” in our Annual Report on Form 10-K filed on November 14, 2011, with the Securities and Exchange Commission.  We assume no obligation to update any forward-looking information contained in this press release or with respect to the announcements described herein.


NATURAL HEALTH TRENDS CORP.

CONSOLIDATED BALANCE SHEETS
(In Thousands, Except Share Data)

 

December 31, 2010

 

March 31, 2011

 

June 30, 2011

 

September 30, 2011

 

 

 

(Unaudited)

 

(Unaudited)

 

(Unaudited)

ASSETS

 

 

 

 

 

 

 

Current assets:

 

 

 

 

 

 

 

Cash and cash equivalents

$648

 

$958

 

$1,437

 

$1,727

Restricted cash

422

 

495

 

500

 

496

Accounts receivable

105

 

161

 

133

 

91

Inventories, net

751

 

715

 

1,193

 

1,105

Other current assets

639

 

984

 

1,235

 

576

Total current assets

2,565

 

3,313

 

4,498

 

3,995

Property and equipment, net

203

 

174

 

158

 

131

Goodwill

1,764

 

1,764

 

1,764

 

1,764

Intangible assets, net

200

 

 

 

Restricted cash

225

 

231

 

237

 

217

Other assets

406

 

321

 

336

 

237

Total assets

$5,363

 

$5,803

 

$6,993

 

$6,344

 

 

 

 

 

 

 

 

LIABILITIES AND STOCKHOLDERS’ DEFICIT

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Current liabilities:

 

 

 

 

 

 

 

Accounts payable

$3,115

 

$3,130

 

$2,614

 

$2,452

Income taxes payable

330

 

341

 

376

 

325

Accrued distributor commissions

723

 

694

 

727

 

1,031

Other accrued expenses

1,792

 

1,680

 

1,702

 

1,086

Deferred revenue

1,029

 

1,633

 

2,696

 

1,458

Deferred tax liability

178

 

177

 

177

 

177

Advance from related party

4

 

237

 

237

 

123

Other current liabilities

1,013

 

1,097

 

1,019

 

1,046

Total liabilities

8,184

 

8,989

 

9,548

 

7,698

Commitments and contingencies

 

 

 

 

 

 

 

Stockholders’ deficit:

 

 

 

 

 

 

 

Natural Health Trends stockholders’ deficit:

 

 

 

 

 

 

 

        Preferred stock

124

 

124

 

124

 

124

        Common stock

11

 

11

 

11

 

11

        Additional paid-in capital

80,414

 

80,428

 

80,449

 

80,471

        Accumulated deficit

(83,643)

 

(84,115)

 

(83,446)

 

(81,813)

Accumulated other comprehensive income:

 

 

 

 

 

 

 

Foreign currency translation adjustments

366

 

469

 

427

 

(39)

Total Natural Health Trends stockholders’ deficit

(2,728)

 

(3,083)

 

(2,435)

 

(1,246)

Noncontrolling interest

(93)

 

(103)

 

(120)

 

(108)

Total stockholders’ deficit

(2,821)

 

(3,186)

 

(2,555)

 

(1,354)

Total liabilities and stockholders’ deficit

$5,363

 

$5,803

 

$6,993

 

$6,344


NATURAL HEALTH TRENDS CORP.

CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)
(In Thousands, Except Per Share Data)

 

Three Months Ended March 31,

 

Three Months Ended
June 30,

 

2010

 

2011

 

2010

 

2011

 

 

 

 

 

 

 

 

Net sales

$6,233

 

$5,175

 

$5,935

 

$7,208

Cost of sales

1,831

 

1,529

 

1,679

 

1,977

Gross profit

4,402

 

3,646

 

4,256

 

5,231

Operating expenses:

 

 

 

 

 

 

 

Distributor commissions

2,252

 

1,762

 

1,980

 

2,714

Selling, general and administrative expenses

2,676

 

2,030

 

2,716

 

1,836

Depreciation and amortization

312

 

232

 

406

 

26

Total operating expenses

5,240

 

4,024

 

5,102

 

4,576

Income (loss) from operations

(838)

 

(378)

 

(846)

 

655

Other income (expense), net:

 

 

 

 

 

 

 

Loss on foreign exchange

20

 

(98)

 

260

 

25

Interest income

 

1

 

7

 

1

Interest expense

(9)

 

(1)

 

(1)

 

Other

(2)

 

3

 

47

 

Total other income (expense), net

9

 

(95)

 

313

 

26

Income (loss) before income taxes

(829)

 

(473)

 

(533)

 

681

Income tax provision (benefit)

11

 

7

 

(28)

 

13

Net income (loss)

(840)

 

(480)

 

(505)

 

668

Plus:  Net loss attributable to the noncontrolling interest

7

 

8

 

 

1

Net income (loss) attributable to Natural Health Trends

(833)

 

(472)

 

(505)

 

669

 

 

 

 

 

 

 

 

Preferred stock dividends

(4)

 

(4)

 

(4)

 

(4)

Net income (loss) attributable to common stockholders of Natural Health Trends

 

$(837)

 

 

$(476)

 

 

$(509)

 

 

$665

 

 

 

 

 

 

 

 

Income (loss) per share of Natural Health Trends – basic and diluted

 

$(0.08)

 

 

$(0.04)

 

 

$(0.05)

 

 

$0.06

 

 

 

 

 

 

 

 

Weighted-average number of shares outstanding – basic

10,418

 

10,635

 

10,485

 

10,675

Weighted-average number of shares outstanding – diluted

10,418

 

10,635

 

10,485

 

10,706

 


 

Three Months Ended September 30,

 

Nine Months Ended
September 30,

 

2010

 

2011

 

2010

 

2011

 

 

 

 

 

 

 

 

Net sales

$5,216

 

$10,562

 

$17,384

 

$22,945

Cost of sales

1,565

 

2,536

 

5,075

 

6,042

Gross profit

3,651

 

8,026

 

12,309

 

16,903

Operating expenses:

 

 

 

 

 

 

 

Distributor commissions

2,081

 

4,166

 

6,313

 

8,642

Selling, general and administrative expenses

2,194

 

2,613

 

7,586

 

6,479

Depreciation and amortization

249

 

23

 

967

 

281

Total operating expenses

4,524

 

6,802

 

14,866

 

15,402

Income (loss) from operations

(873)

 

1,224

 

(2,557)

 

1,501

Other income, net:

 

 

 

 

 

 

 

Loss on foreign exchange

141

 

428

 

421

 

355

Interest income

 

1

 

7

 

3

Interest expense

(1)

 

(13)

 

(11)

 

(14)

Other

24

 

9

 

69

 

12

Total other income, net

164

 

425

 

486

 

356

Income (loss) before income taxes

(709)

 

1,649

 

(2,071)

 

1,857

Income tax provision

29

 

16

 

12

 

36

Net income (loss)

(738)

 

1,633

 

(2,083)

 

1,821

Plus:  Net (income) loss attributable to the noncontrolling interest

(4)

 

 

3

 

9

Net income (loss) attributable to Natural Health Trends

(742)

 

1,633

 

(2,080)

 

1,830

 

 

 

 

 

 

 

 

Preferred stock dividends

(4)

 

(4)

 

(12)

 

(12)

Net income (loss) attributable to common stockholders of Natural Health Trends

 

$(746)

 

 

$1,629

 

 

$(2,092)

 

 

$1,818

 

 

 

 

 

 

 

 

Income (loss) per share of Natural Health Trends – basic and diluted

 

$(0.07)

 

 

$0.15

 

 

$(0.20)

 

 

$0.17

 

 

 

 

 

 

 

 

Weighted-average number of shares outstanding – basic

10,536

 

10,732

 

10,480

 

10,669

Weighted-average number of shares outstanding – diluted

10,536

 

10,898

 

10,480

 

10,699

Contact:

Natural Health Trends Corp.
[email protected]

SOURCE:  Natural Health Trends Corp.

 


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