Natural Health Trends Corp (NHTC) 2024 Q3 法說會逐字稿

Greetings, and welcome to Natural Health Trends Corp., third quarter 2024 earnings conference call. (Operator Instructions)

您好，歡迎參加 Natural Health Trends Corp. 2024 年第三季財報電話會議。（操作員說明）

I would now like to turn the conference over to your host, Michelle Glidewell, with Natural Health Trends Corp. Thank you. You may begin.

現在我想將會議交給自然健康趨勢公司的主持人 Michelle Glidewell。你可以開始了。

Thank you, and welcome to Natural Health Trends third-quarter 2024 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 through the result of certain factors, including those set forth in the company's filings with the Securities and Exchange Commission.

謝謝，歡迎參加自然健康趨勢 2024 年第三季財報電話會議。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）的影響，實際結果、業績或成就可能與此類前瞻性陳述中的預期有重大差異。

It would 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 [excising] 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.

另外值得注意的是，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[刪除]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 third-quarter 2024 financial results. With me today is Scott Davidson, our Senior Vice President and Chief Financial Officer. During the third quarter, revenue was $10.7 million, a 1% increase compared to the third quarter of 2023.

謝謝米歇爾，也謝謝大家今天早上加入我們討論我們的 2024 年第三季財務業績。今天與我在一起的是我們的高級副總裁兼財務長 Scott Davidson。第三季營收為 1,070 萬美元，較 2023 年第三季成長 1%。

Our business has been affected by the widely reported consumer hesitancy to invest or spend in our main market. Still, we managed to increase net sales sequentially and year over year, at the same time improving our operating bottom line over three consecutive quarters. Though the pace of growth is not where we like it to be, our customers and leaders continue to demonstrate strong engagement, and we are working closely with them to navigate these changing times. Our ability to adapt, adjust programs and fine-tune our plans has been instrumental in supporting our customer base while also acting in the best interest of our shareholders.

我們的業務受到了廣泛報導的消費者對在我們的主要市場投資或支出猶豫不決的影響。儘管如此，我們還是成功地實現了淨銷售額的連續成長和同比增長，同時連續三個季度提高了我們的營運利潤。儘管成長速度並不如我們所願，但我們的客戶和領導者繼續表現出強烈的參與度，我們正在與他們密切合作，以應對這些不斷變化的時代。我們適應、調整計畫和微調計畫的能力有助於支持我們的客戶群，同時也符合股東的最佳利益。

In China and Hong Kong, our teams maintained aggressive calendars of activities ranging from local, smaller scale in-person meetings to two-day train-the-trainer professional and personal development sessions and charity activities to help drive business growth and support our branding.

在中國大陸和香港，我們的團隊保持積極的活動日程，從當地的小規模面對面會議到為期兩天的培訓師培訓專業和個人發展課程以及慈善活動，以幫助推動業務增長並支持我們的品牌推廣。

Also in Q3, more than 200 members joined us on an incentive trip to Turkey, a great opportunity for knowledge sharing, motivation, personal growth and cultural exposure. This ambitious calendar of activities will continue through Q4 as we roll out new products in the region, including our Skindulgence revitalizing serum and eye cream, along with the new flavored collagen supreme supplement and Root Revive, a new hair growth serum to promote a healthier, stronger looking hair.

同樣在第三季度，超過 200 名會員加入了我們的土耳其獎勵之旅，這是知識共享、激勵、個人成長和文化接觸的絕佳機會。這項雄心勃勃的活動將持續到第四季度，我們將在該地區推出新產品，包括Skindulgence 煥發精華液和眼霜，以及新口味的膠原蛋白至尊補充劑和Root Revive（一種新的生髮精華液，可促進更健康、頭髮看起來更堅韌。

Around the world, our global staff and field teams are hard at work, hosting local and regional meetings, providing team training and conducting recognition events. Their focus is on expanding product education, growing our member and customer base, driving product repurchase and developing strong teams to carry the business forward. In September, we held prelaunch activities in Colombia. And on October 1, we officially opened the market.

在世界各地，我們的全球員工和現場團隊正在努力工作，主辦當地和區域會議，提供團隊培訓並進行表彰活動。他們的重點是擴大產品教育、擴大我們的會員和客戶群、推動產品回購以及發展強大的團隊來推動業務發展。9月，我們在哥倫比亞舉辦了啟動前活動。10月1日，我們正式開市。

We look forward to what this market may bring in terms of new customers and exposure to a broader Latin America base of entrepreneurs. During the quarter, we embarked on incentive trips to destinations abroad. In August, members from North America traveled together to Peru, visiting Lima and Machu Picchu for some inspiring team building and sizing.

我們期待這個市場能帶來新客戶和接觸更廣泛的拉丁美洲企業家基礎。本季度，我們開始了前往國外目的地的獎勵旅行。八月，來自北美的成員一起前往秘魯，參觀利馬和馬丘比丘，進行一些鼓舞人心的團隊建立和規模調整。

And earlier this month, several markets combined incentive activities as our leaders and qualifiers from Peru, Mexico and Japan were treated to an incredible incentive trip to Paris. We continue to make steady advancements toward our digital enhancement project, which we believe will fuel future growth by boosting member productivity and improving the overall selling and shopping experience.

本月早些時候，多個市場結合了獎勵活動，來自秘魯、墨西哥和日本的領導者和預選賽選手參加了令人難以置信的巴黎獎勵之旅。我們繼續穩步推進數位化增強項目，我們相信該項目將透過提高會員生產力和改善整體銷售和購物體驗來推動未來的成長。

We anticipate rolling out these developments to our members and customers early next year. We appreciate the hard work and dedication that our few leaders and members continue to demonstrate in spite of a complicated sales landscape.

我們預計明年初向我們的會員和客戶推出這些開發成果。儘管銷售情況複雜，但我們的少數領導者和成員仍然表現出辛勤工作和奉獻精神，我們對此表示讚賞。

Our thoughtful planning and careful execution of strategies to support business growth and navigate this challenging economic environment remains key. Included in that is maintaining a vigilant focus on cost control, including expense management, inventory and product optimization to ensure the company remains positioned for future success.

我們深思熟慮的規劃和精心執行的策略來支持業務成長和應對這一充滿挑戰的經濟環境仍然是關鍵。其中包括保持對成本控制的警惕，包括費用管理、庫存和產品優化，以確保公司為未來的成功做好準備。

With that, I'd like to turn the call over to our CFO, Scott Davidson, to discuss our financial results in greater detail. Scott?

說到這裡，我想將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 third quarter was $10.7 million, an increase of 1% compared to $10.6 million in the third quarter of 2023. As Chris stated, this represents an increase in net sales sequentially and year over year. Our active member base decreased slightly to 30,880 at September 30 from 31,110 at June 30 and was down 11% from 34,660 at September 30 last year.

謝謝你，克里斯。第三季總營收為 1,070 萬美元，比 2023 年第三季的 1,060 萬美元成長 1%。正如克里斯所說，這代表淨銷售額連續和同比增長。我們的活躍會員數量從 6 月 30 日的 31,110 人略微減少至 9 月 30 日的 30,880 人，比去年 9 月 30 日的 34,660 人減少了 11%。

Turning to our cost and operating expenses. Gross profit margin declined of 74.1% from 74.7% in the third quarter of last year due to higher costs related to our Premium Noni Juice product. Commissions expense as a percent of total revenue for the third quarter was 40.5% compared to 41.1% a year ago due to lower weekly commissions earned outside of our Hong Kong business.

轉向我們的成本和營運費用。由於我們的優質諾麗果汁產品相關成本上升，毛利率從去年第三季的 74.7% 下降了 74.1%。第三季佣金支出佔總收入的百分比為 40.5%，而去年同期為 41.1%，原因是我們在香港業務以外賺取的每週佣金較低。

Selling, general and administrative expenses for the quarter were $3.9 million, flat compared to a year ago. As a result, operating loss for the quarter was $275,000 compared to $292,000 in the third quarter last year, an improvement in our operating bottom line for three consecutive quarters. However, due to less interest income and a higher effective tax rate, Net income for the third quarter was $35,000 or breakeven per diluted share compared to $172,000 or $0.02 per diluted share in the third quarter of 2023.

該季度的銷售、一般和管理費用為 390 萬美元，與去年同期持平。因此，本季營運虧損為 27.5 萬美元，而去年第三季為 29.2 萬美元，連續三個季度營運利潤有所改善。然而，由於利息收入減少和有效稅率較高，第三季攤薄後每股淨利潤為 35,000 美元，即盈虧平衡，而 2023 年第三季為 172,000 美元，即攤薄後每股收益 0.02 美元。

Now I'll turn to our balance sheet and cash flow. Net cash used in operating activities was $3.5 million during the first nine months of 2024 compared to $4.2 million during the comparable period a year ago. Excluding our required annual tax installment payment related to the 2017 US Tax Cuts and Jobs Act, we generated $514,000 in cash flows from operations during this period, which is an improvement of $1.7 million over the comparable prior year period.

現在我將談談我們的資產負債表和現金流。2024 年頭 9 個月，經營活動使用的現金淨額為 350 萬美元，去年同期為 420 萬美元。不包括與 2017 年美國減稅和就業法案相關的年度稅款分期付款，我們在此期間的營運現金流量為 514,000 美元，比去年同期增加了 170 萬美元。

Total cash, cash equivalents and marketable securities was $46.3 million at September 30, down from $48.7 million at June 30 due to our quarterly dividend payment. As returning capital to our stockholders remains a top priority, I am pleased to announce that on October 28, our Board of Directors declared another quarterly cash dividend of $0.20 per share which will be payable on November 22 to stockholders of record as of November 12.

截至 9 月 30 日，現金、現金等價物和有價證券總額為 4,630 萬美元，低於 6 月 30 日的 4,870 萬美元，因為我們支付了季度股息。由於向股東返還資本仍然是我們的首要任務，我很高興地宣布，10 月28 日，我們的董事會宣布再次發放每股0.20 美元的季度現金股息，並將於11 月22 日向截至11 月12 日在冊的股東支付。

Navigating the constantly evolving business landscape requires thoughtful development and implementation of programs that enhance performance and productivity of our members. We remain committed to this practice and to working alongside our leaders to support them and their team's advancement by focusing on key strategic initiatives, including product innovation, digital enhancement, market expansion and training. Our primary goal is to return to a healthy growth phase by executing strategies that increase top-line revenue, ultimately delivering value to our shareholders.

駕馭不斷變化的商業環境需要深思熟慮地制定和實施旨在提高會員績效和生產力的計劃。我們仍然致力於這項實踐，並與我們的領導者一起工作，透過專注於關鍵策略舉措（包括產品創新、數位增強、市場擴張和培訓）來支持他們及其團隊的進步。我們的主要目標是透過執行增加營收的策略，最終為股東創造價值，恢復健康成長階段。

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。

This concludes today's conference. You may disconnect your lines at this time, and we thank you for your participation.

今天的會議到此結束。此時您可以斷開線路，我們感謝您的參與。