Natural Health Trends Corp (NHTC) 2023 Q4 法說會逐字稿

Greetings. Welcome to Natural Health Trends Corp., fourth Quarter 2023 earnings conference call. (operator Instructions) Please note this conference is being recorded.

問候。歡迎參加 Natural Health Trends Corp. 2023 年第四季財報電話會議。（操作員說明）請注意，本次會議正在錄製中。

I will now turn the conference over to Michelle Glidewell with Natural Health Trends Corp. Thank you. You may begin.

我現在將會議交給 Natural Health Trends Corp 的 Michelle Glidewell。謝謝。你可以開始了。

Thank you, and welcome to Natural Health Trends' fourth quarter and full year 2023 earnings conference call. During today's call, there may be statements made relating to the future results of the company that are forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995. Actual results, performance, or achievements could differ materially from those anticipated in such forward-looking statements to the result of certain factors, including those set forth in the company's filings with the Securities and Exchange Commission.

謝謝，歡迎參加 Natural Health Trends 的第四季和 2023 年全年財報電話會議。在今天的電話會議中，可能會做出與公司未來業績相關的聲明，這些聲明屬於 1995 年《私人證券訴訟改革法案》中定義的前瞻性聲明。由於某些因素（包括公司向美國證券交易委員會提交的文件中列出的因素）的結果，實際結果、業績或成就可能與此類前瞻性聲明中的預期存在重大差異。

It should also be noted that today's call will be webcast live and can be found on the Investors section of the company's corporate website at naturalhealthtrendscorp.com. Instructions for accessing the archived version of the conference call can be found in today's financial results press release, which was issued at approximately 9:00 AM Eastern Time.

還應該指出的是，今天的電話會議將進行網路直播，並且可以在該公司網站naturalhealthtrendscorp.com的投資者部分找到。有關存取電話會議存檔版本的說明，請參閱今天的財務業績新聞稿，該新聞稿於東部時間上午 9:00 左右發布。

At this time, I'd like to turn the call over to Chris Sharng, President of Natural Health Trends.

現在，我想將電話轉交給自然健康趨勢總裁 Chris Sharng。

Thank you, Michelle, and thanks to everyone for joining us this morning to discuss our fourth quarter and full year 2023 financial results. With me today is Scott Davidson, our Senior Vice President and Chief Financial Officer.

謝謝米歇爾，也謝謝大家今天早上加入我們討論我們的第四季和 2023 年全年財務業績。今天與我在一起的是我們的高級副總裁兼財務長 Scott Davidson。

As indicated in our financial results release earlier today, we managed to achieve a 3% sequential increase in orders compared to the third quarter of 2023, despite continued tepid consumer sentiment in China and an overall challenging macroeconomic environment in this market.

正如我們今天稍早發布的財務業績所示，儘管中國消費者信心持續不溫不火且該市場宏觀經濟環境總體充滿挑戰，但與2023 年第三季相比，我們的訂單仍實現了3 % 的環比增長。

Revenue for the quarter totaled $10.9 million compared to $10.6 million last quarter and $12.5 million in the fourth quarter a year ago. We believe that quarter-over-quarter sequential uptick is largely due to the increased frequency and size of our in-person activities during the period, and we plan to sponsor more such events in the coming months to build our growth and to help improve the effectiveness of our market campaigns.

本季營收總計 1,090 萬美元，上季營收為 1,060 萬美元，去年第四季營收為 1,250 萬美元。我們認為，季度環比的成長主要是由於我們在此期間面對面活動的頻率和規模增加，我們計劃在未來幾個月贊助更多此類活動，以促進我們的成長並幫助改善我們的市場活動的有效性。

In addition, during the quarter, we generated positive net income, partly due to our ability to effectively protect margin and control costs despite lingering inflation and a silver dollar. In Hong Kong, we held a Fly High event in November with nearly 500 members in attendance. This activity allow us to offer in-person training and introduced our promising new product, RelaxaPro, uniquely formulated to help reduce stress and promote calmness. We look forward to hosting more of these activities in the months to come and as it allows us to engage directly with members and build upon the excitement and energy that comes from in-person gatherings.

此外，在本季度，我們產生了正的淨利潤，部分原因是儘管通貨膨脹和銀元揮之不去，但我們仍能有效保護利潤並控製成本。11 月份，我們在香港舉辦了 Fly High 活動，有近 500 位會員參加。這項活動使我們能夠提供現場培訓，並推出了我們有前途的新產品 RelaxaPro，其獨特配方有助於減輕壓力和促進平靜。我們期待在未來幾個月舉辦更多此類活動，因為它使我們能夠直接與會員互動，並利用面對面聚會帶來的興奮和活力。

We have just wrapped up our Abu Dhabi trip, bringing 300 Chinese members along for training and team building. This marks our first international travel for this market since the onset of the pandemic. Our participants are enthusiastic to embark on more of these ventures with us soon.

我們剛結束了阿布達比之行，帶著300名中國隊員參加了訓練和團隊建立。這是自疫情爆發以來我們首次針對該市場進行國際旅行。我們的參與者熱衷於很快與我們一起開展更多此類計畫。

Our 2024 plan to prioritize and emphasize training offerings for all types of consumers attracted to our business from the product enthusiasts to the mid-level builder to the seasoned leader. Through this systematic training that utilizes knowledgeable employees, an expert in product and software development, we hope to cultivate new talents and support current hard-working members.

我們的 2024 年計畫優先並強調為我們業務所吸引的所有類型的消費者提供培訓服務，從產品愛好者到中級建構者再到經驗豐富的領導者。透過這種利用知識豐富的員工、產品和軟體開發專家的系統培訓，我們希望培養新的人才並支持現有的辛勤工作的成員。

Our Taiwan team hosted its first larger-scale activities since the global pandemic. The Precision Health event is a new wellness seminar where attendees participate in various health screenings. Participants walk away with a deeper understanding of their current state of well-being, along with product knowledge and lifestyle recommendations. As we continue these precision health seminars in the future, we are hopeful this value add can help further develop and expand the market with an influx of new members and customers.

我們的台灣團隊舉辦了全球疫情大流行以來的首次大型活動。Precision Health 活動是一個新的健康研討會，與會者可以參加各種健康檢查。參與者離開時可以更深入地了解他們當前的健康狀況，以及產品知識和生活方式建議。隨著我們未來繼續舉辦這些精準健康研討會，我們希望這種附加價值能夠隨著新會員和客戶的湧入而進一步開發和擴大市場。

In North America, the fourth quarter was busy with activities at our three healthy lifestyle plus centers in Middletown, New Jersey; Rowland Heights, California; and Richmond, British Columbia. Early in the quarter, we held the product roadshow showcasing our top-selling Premium Noni products, and we follow that up with a December premium Noni manufacturing facility and corporate headquarter tour for a select group of qualifiers. In addition, qualification just closed for our Machu Pichu. it's scheduled for later this year.

在北美，第四季我們位於新澤西州米德爾敦的三個健康生活方式中心的活動非常繁忙；加州羅蘭崗；和不列顛哥倫比亞省里士滿。本季度初，我們舉行了產品路演，展示了我們最暢銷的優質諾麗產品，隨後我們為精選的合格人員組織了 12 月份的優質諾麗製造工廠和公司總部之旅。此外，我們馬丘比丘的資格賽也剛結束。計劃於今年晚些時候進行。

In Europe, we executed our incentive trip to Madeira, Spain, posting a well-deserving group of qualifiers on a five-day trip. We were also honored to be recognized by the Swedish direct-selling association for a second year in a row as a top company in the market.

在歐洲，我們執行了前往西班牙馬德拉島的獎勵旅行，在為期五天的旅行中發布了一組當之無愧的預選賽選手。我們也很榮幸連續第二年被瑞典直銷協會評為市場頂級公司。

We're pleased to conclude a year with a rise in sequential quarterly revenue. As we are here in a new year, I want to express my gratitude to our committed leaders, members, preferred customers, employees, and stockholders for their ongoing support of energy global in our range of products. We believe that our business presents an incredible opportunity for all ages ,professionals and the millions of potential customers worldwide seeking alternative avenues to enhance their personal well-being, whether it's earning some extra income or taking significant strides toward improving overall health and wellness.

我們很高興以季度收入環比增長結束這一年。在新的一年到來之際，我要向我們忠誠的領導者、會員、首選客戶、員工和股東表示感謝，感謝他們對 Energy Global 在我們產品系列中的持續支持。我們相信，我們的業務為所有年齡層、專業人士和全球數百萬尋求替代途徑來提高個人福祉的潛在客戶提供了難以置信的機會，無論是賺取一些額外收入還是在改善整體健康和保健方面取得重大進展。

Our exceptional product offerings are here to support those aspirations. We extend our wishes for good health and success throughout 2024 and look forward to speaking again with an update next quarter. And now I would turn the call over to our CFO, Scott Davidson, to discuss our financial results in greater detail. Scott?

我們提供卓越的產品來支持這些願望。我們祝福 2024 年身體健康、取得成功，並期待下個季度再次發表最新消息。現在我將把電話轉給我們的財務長史考特戴維森，更詳細地討論我們的財務表現。史考特？

Thank you, Chris. Total revenue for the fourth quarter was $10.9 million, an increase of 3% compared to $10.6 million in the third quarter of 2023 and a decrease of 13% compared to $12.5 million in the fourth quarter of last year. As Chris mentioned, we were able to increase revenue sequentially despite tepid consumer sentiment in China.

謝謝你，克里斯。第四季總營收為 1,090 萬美元，比 2023 年第三季的 1,060 萬美元成長 3%，比去年第四季的 1,250 萬美元下降 13%。正如克里斯所提到的，儘管中國消費者信心不溫不火，我們仍能持續增加收入。

For the full year 2023, total revenue was $43.9 million compared to $49.1 million in 2022. The decrease year over year was largely accounted for by changes in deferred revenue. Deferred revenue increased $569,000 during 2023, but decreased $2.9 million last year, resulting in a $3.5 million unfavorable revenue in the bank. Our active member base declined 6% to $32,410 at December 31 from $34,660 at September 30 and was down 16% from $38,660 at December 31 last year.

2023 年全年總收入為 4,390 萬美元，而 2022 年為 4,910 萬美元。年比下降的主要原因是遞延收入的變化。2023 年遞延收入增加了 569,000 美元，但去年減少了 290 萬美元，導致銀行出現 350 萬美元的不利收入。我們的活躍會員基數從 9 月 30 日的 34,660 美元下降到 12 月 31 日的 32,410 美元，下降了 6%，比去年 12 月 31 日的 38,660 美元下降了 16%。

Turning to our costs and operating expenses.

轉向我們的成本和營運費用。

Gross profit margin of 74.5% improved slightly from 73.9% in the fourth quarter of last year due to lower logistics costs. Commissions expense as a percent of net sales for the fourth quarter decreased to 41.6% from 43% in the same quarter last year. Selling, general and administrative expenses for the quarter were$3.8 million, consistent with a year ago.

由於物流成本下降，毛利率為 74.5%，較去年第四季的 73.9% 略有改善。第四季佣金費用佔淨銷售額的百分比從去年同期的 43% 下降至 41.6%。本季的銷售、一般和管理費用為 380 萬美元，與去年同期持平。

As a result, operating loss for the quarter was $242,000 compared to $292,000 in the third quarter of 2023 and operating income of $43,000 in the fourth quarter of last year. We recorded an income tax provision of $108,000 for the quarter compared to $255,000 in the fourth quarter last year.

因此，本季營業虧損為 24.2 萬美元，而 2023 年第三季為 29.2 萬美元，去年第四季營業收入為 4.3 萬美元。我們本季的所得稅準備金為 108,000 美元，而去年第四季為 255,000 美元。

Net income for the fourth quarter totaled $358,000 or $0.03 per diluted share compared to $173,000 or $0.02 per diluted share in the third quarter and $188,000 or $0.02 per diluted share in the fourth quarter of 2022. For the full year, net income totaled $568,000 or $0.05 per diluted share compared to $313,000 or $0.03 per diluted share in 2022.

第四季淨利總計358,000 美元，即稀釋後每股收益0.03 美元，而第三季淨利為173,000 美元，即稀釋後每股收益0.02 美元，2022 年第四季淨利為188,000 美元，即稀釋後每股收益0.02 美元。全年淨利潤總計 568,000 美元，即稀釋後每股收益 0.05 美元，而 2022 年淨利潤為 313,000 美元，即稀釋後每股收益 0.03 美元。

I'll now turn to our balance sheet and cash flow. Total cash and cash equivalents were $56.2 million at December 31, down from $58.4 million at September 30. Net cash used by operating activities was $69,000 in the fourth quarter compared to net cash provided by operating activities of $938,000 in the fourth quarter last year.

我現在談談我們的資產負債表和現金流。截至 12 月 31 日，現金及現金等價物總額為 5,620 萬美元，低於 9 月 30 日的 5,840 萬美元。第四季經營活動使用的淨現金為 69,000 美元，而去年第四季經營活動提供的淨現金為 938,000 美元。

For the full year, net cash used in operating activities was $4.3 million compared to $4.9 million in 2022. Before tax installment payments, the liability of which arises from the 2017 US Tax Cuts and Jobs Act, cash used in operating activities was $1.2 million in 2023 versus $3.2 million a year ago. For the full year 2023, we paid out $9.2 million in dividends as returning capital to our stockholders remains a priority. I am pleased to announce that on February 5, our Board of Directors declared a quarterly cash dividend of $0.2 per share, which will be payable on March first to stockholders of record as of February 20.

全年經營活動使用的現金淨額為 430 萬美元，而 2022 年為 490 萬美元。在分期繳稅之前（2017 年美國減稅和就業法案產生的負債），2023 年經營活動中使用的現金為 120 萬美元，而一年前為 320 萬美元。2023 年全年，我們支付了 920 萬美元的股息，因為向股東返還資本仍然是我們的首要任務。我很高興地宣布，2 月 5 日，我們的董事會宣布派發每股 0.2 美元的季度現金股息，並將於 3 月 1 日向截至 2 月 20 日在冊的股東支付。

We continue to find inspiration in the enthusiasm and dedication demonstrated by our leaders, members, and customers towards both our product offering and the global business opportunity we provide. Having personally spent time with many of our key leaders in Abu Dhabi, their commitment and optimism for the future has never shine brighter. We stand by our promise to continue innovating, growing, and strengthening our offering to support their best.

我們繼續從我們的領導者、會員和客戶對我們的產品和我們提供的全球商業機會所表現出的熱情和奉獻精神中尋找靈感。我們在阿布達比與我們的許多主要領導人進行了親自交談，他們對未來的承諾和樂觀從未如此耀眼。我們信守承諾，繼續創新、發展和加強我們的產品，以支持他們最好的表現。

That completes our prepared remarks. I will now turn the call back over to the operator.

我們準備好的發言就到此結束了。我現在將把電話轉回給接線生。

Thank you. This will conclude today's conference. You may disconnect your lines at this time and thank you for your participation.

謝謝。今天的會議到此結束。此時您可以斷開線路，感謝您的參與。