Nautilus Inc (NLS) 2018 Q1 法說會逐字稿

Good day, and welcome to the Nautilus First Quarter 2018 Earnings Results Conference Call. Today's conference is being recorded.

美好的一天，歡迎參加 Nautilus 2018 年第一季度盈利結果電話會議。今天的會議正在錄製中。

At this time, I'd like to turn the conference over to John Mills with ICR. Please go ahead, sir

這次，我想將會議轉交給 ICR 的約翰·米爾斯 (John Mills)。請繼續，先生

Great. Thank you. Good afternoon, everyone. Welcome to Nautilus' First Quarter 2018 Conference Call. Participants on the call from Nautilus are Bruce Cazenave, our Chief Executive Officer; Sid Nayar, Chief Financial Officer; and Bill McMahon, Chief Operating Officer. Our earnings release was issued earlier today and may be downloaded from our website at nautilusinc.com. Once you go to the website, please click on the Investor Relations page, and you will see the release on that page. The earnings release includes a reconciliation of the non-GAAP financial measures mentioned in today's call to the most directly comparable GAAP measures.

偉大的。謝謝。大家下午好。歡迎參加 Nautilus 2018 年第一季度電話會議。參加 Nautilus 電話會議的參與者包括我們的首席執行官 Bruce Cazenave； Sid Nayar，首席財務官；和首席運營官比爾·麥克馬洪。我們的收益報告於今天早些時候發布，可以從我們的網站 nautilusinc.com 下載。訪問網站後，請點擊投資者關係頁面，您將在該頁面上看到新聞稿。收益發布包括今天電話會議中提到的非公認會計原則財務指標與最直接可比的公認會計原則指標的調節。

Remarks on today's conference call will include forward-looking statements within the meaning of the securities laws. These include statements concerning financial projections, operating trends, anticipated growth and profitability, anticipated new product introductions, planned capital expenditures, projected effective tax rates, and anticipated results of new product and business development initiatives. Forward-looking statements are subject to a number of risks and uncertainties, and actual results may differ materially from these statements. For more information about these risks, please refer to our Annual Report on Form 10-K.

今天電話會議的發言將包括證券法含義內的前瞻性陳述。其中包括有關財務預測、運營趨勢、預期增長和盈利能力、預期新產品推出、計劃資本支出、預計有效稅率以及新產品和業務開發計劃的預期結果的聲明。前瞻性陳述受到許多風險和不確定性的影響，實際結果可能與這些陳述存在重大差異。有關這些風險的更多信息，請參閱我們的 10-K 表年度報告。

Nautilus undertakes no obligation to update or otherwise publicly release any revision to forward-looking statements to reflect new information, events or circumstances after they were made, or to reflect the occurrence of unanticipated events. All information and comments regarding our operating results pertain to our continuing operations, unless otherwise noted.

Nautilus 不承擔更新或以其他方式公開發布前瞻性陳述的任何修訂的義務，以反映做出後的新信息、事件或情況，或反映意外事件的發生。除非另有說明，有關我們經營業績的所有信息和評論均與我們的持續經營有關。

And with that, it's my pleasure to turn the call over to our CEO, Mr. Bruce Cazenave. Please go ahead, Bruce.

至此，我很高興將電話轉給我們的首席執行官布魯斯·卡澤納夫先生。請繼續，布魯斯。

Thank you, John. Good afternoon, everyone, and thank you for joining our call today. I'd like to start by providing a general overview of our first quarter, and then we'll turn it over to Sid Nayar to review our financials in more detail. Bill McMahon will then provide updates on the business segments as well as on product activity and expected introductions for the remainder of this year. Finally, I'd like to provide some closing remarks, including an update on our outlook for 2018, and then we'll open up the call for questions.

謝謝你，約翰。大家下午好，感謝您今天加入我們的電話會議。我想首先概述我們第一季度的情況，然後我們將其交給 Sid Nayar，以更詳細地審查我們的財務狀況。隨後，比爾·麥克馬洪 (Bill McMahon) 將提供有關業務部門以及產品活動的最新信息以及今年剩餘時間的預期推出情況。最後，我想提供一些結束語，包括我們對 2018 年前景的最新展望，然後我們將開始提問。

First quarter 2018 revenue and operating income exceeded our guidance. The performance increases were driven primarily by strong growth in the mass retail channel of distribution within the Retail segment. Other channels of our business performed as expected, with modest growth in the specialty commercial channel and a decline in the Direct segment due to the phase-down of the mature TreadClimber line.

2018 年第一季度收入和營業收入超出了我們的指導。業績增長主要得益於零售領域大眾零售分銷渠道的強勁增長。我們業務的其他渠道表現符合預期，專業商業渠道略有增長，而由於成熟的 TreadClimber 產品線的逐步淘汰，直接業務渠道有所下降。

Increased operating expense leverage was achieved in the quarter versus prior year, despite stepped-up investments in product development and the multifaceted operating improvement plan we outlined in the previous earnings call. I will provide an update on the progress of this plan in my summary comments.

儘管我們在上一次財報電話會議中概述了產品開發方面的投資以及多方面的運營改進計劃，但本季度的運營費用槓桿率仍較上年同期有所提高。我將在我的總結評論中提供有關該計劃進展的最新信息。

Because of our operating model and performance during the quarter, we also continued to strengthen our balance sheet. We ended the quarter with approximately $93 million in cash and marketable securities, and further reduced debt to $44 million. In addition, we repurchased $2.7 million of stock in the open market as part of our previously announced stock repurchase program.

由於本季度我們的運營模式和業績，我們還繼續加強我們的資產負債表。本季度結束時，我們擁有約 9300 萬美元的現金和有價證券，並將債務進一步減少至 4400 萬美元。此外，作為我們之前宣布的股票回購計劃的一部分，我們在公開市場回購了 270 萬美元的股票。

As we look forward into 2018, new products planned to be launched this year are tracking as scheduled, as Bill will describe shortly. They are being very positively received in both formal market launches at industry shows as well as with end users in field tests.

展望 2018 年，正如 Bill 將很快描述的那樣，計劃今年推出的新產品正在按計劃進行。它們在行業展會的正式市場發布以及現場測試的最終用戶中都受到了非常積極的歡迎。

Now I'd like to turn it over -- turn the call over to Sid. Sid?

現在我想把它轉過來——把電話轉給 Sid。席德？

Thanks, Bruce. Good afternoon, everyone. I'd like to review the details of our financial results for the first quarter of 2018. Net sales for the first quarter totaled $114.8 million, an increase of 1.4% as compared to the same period in the prior year, reflecting strong growth in the retail channels, partially offset by lower sales in the direct channel.

謝謝，布魯斯。大家下午好。我想回顧一下我們 2018 年第一季度財務業績的詳細信息。第一季度淨銷售額總計 1.148 億美元，較上年同期增長 1.4%，反映出零售渠道的強勁增長，但部分被直銷渠道銷售額下降所抵消。

First quarter gross margins decreased by 250 basis points in the Direct segment to 63%, and were down 80 basis points in the Retail segment to 31.2%, when compared to the same quarter last year.

與去年同期相比，第一季度直營業務毛利率下降 250 個基點至 63%，零售業務毛利率下降 80 個基點至 31.2%。

Direct margins were primarily impacted by a shift in product mix to lower-margin products, while Retail margins were impacted by higher product costs, reflecting unfavorable changes in foreign exchange currency exchange rates.

直接利潤率主要受到產品組合向低利潤率產品轉變的影響，而零售利潤率則受到產品成本上升的影響，反映出外匯匯率的不利變化。

On an overall basis, total company gross margins for the first quarter 2018 decreased by 320 basis points to 51.3% versus the same period prior year, reflecting the lower gross margin rate in Direct and a shift in channel mix to an increased percentage of Retail segment revenues.

總體而言，2018 年第一季度公司總毛利率較去年同期下降 320 個基點至 51.3%，反映出直營毛利率較低以及渠道組合轉向零售業務比例增加收入。

Total operating expenses for the first quarter of 2018, as a percentage of net sales, decreased to 42% from 43.3% in the same period last year, primarily reflecting decreased sales and marketing expense, partially offset by higher R&D expense.

2018年第一季度的總運營費用占淨銷售額的百分比從去年同期的43.3%下降至42%，主要反映了銷售和營銷費用的減少，但部分被研發費用的增加所抵消。

Sales and marketing expense for the first quarter of 2018 was $36.8 million or 32% of net sales as compared to $37.7 million or 33.3% of net sales in the same period last year. The decreased dollar spending reflected a non-recurrence of a $1.2 million reserve recorded in the same period of the prior year, along with lower financing fees of $1.6 million. These decreases were partially offset by a $1.3 million increase in media costs, reflecting lower ROIs on our advertising spend. The decrease in sales and marketing expense as a percentage of sales reflects the same factors.

2018 年第一季度的銷售和營銷費用為 3,680 萬美元，占淨銷售額的 32%，而去年同期為 3,770 萬美元，占淨銷售額的 33.3%。美元支出減少反映了去年同期記錄的 120 萬美元準備金不再重複，以及融資費用減少了 160 萬美元。這些下降被媒體成本增加 130 萬美元部分抵消，反映出我們廣告支出的投資回報率較低。銷售和營銷費用佔銷售額百分比的下降也反映了同樣的因素。

General and administrative expenses were $6.9 million or 6% of net sales for the first quarter of 2018, which compares to $7.5 million or 6.6% of net sales in the same period last year. The decreased dollar spending in G&A primarily reflects lower litigation costs.

2018 年第一季度的一般及管理費用為 690 萬美元，占淨銷售額的 6%，而去年同期為 750 萬美元，占淨銷售額的 6.6%。G&A 美元支出的減少主要反映了訴訟成本的降低。

Research and development costs in the first quarter of 2018 were $4.5 million or 3.9% of net sales compared to $3.9 million or 3.5% of net sales in the same period last year. The dollar increase reflects increased investment in the engineering and digital platform resources required to continue to innovate and broaden our product portfolio.

2018 年第一季度的研發成本為 450 萬美元，占淨銷售額的 3.9%，而去年同期為 390 萬美元，占淨銷售額的 3.5%。美元的增長反映了對繼續創新和擴大我們的產品組合所需的工程和數字平台資源的投資增加。

Operating income for the first quarter of 2018 decreased to $10.7 million as compared to operating income of $12.7 million in the same quarter of last year. The decrease reflects the decline in gross margin rates, partially offset by the decrease in operating expenses. Operating margin for the first quarter of 2018 decreased to 9.3% compared to 11.2% for the same period last year.

2018年第一季度的營業收入下降至1070萬美元，而去年同期的營業收入為1270萬美元。這一下降反映了毛利率的下降，但部分被運營費用的下降所抵消。2018年第一季度的營業利潤率下降至9.3%，而去年同期為11.2%。

Income from continuing operations for the first quarter of 2018 was $8.1 million or $0.27 per diluted share as compared to $8.2 million or $0.26 per diluted share for the same period last year.

2018 年第一季度的持續經營收入為 810 萬美元，即稀釋後每股收益 0.27 美元，而去年同期為 820 萬美元，即稀釋後每股收益 0.26 美元。

EBITDA from continuing operations in the first quarter of 2018 decreased to $13.1 million versus $14.9 million for the same quarter of the prior year. The effective tax rate for the first quarter of 2018 was 23.7% compared to 33.6% in the same period last year. The reduced tax rate reflects the impact on the quarter of the recently enacted Tax Cuts and Jobs Act. We anticipate the full year effective rate to be in the 24% to 25% range.

2018 年第一季度持續經營業務的 EBITDA 下降至 1,310 萬美元，而上年同期為 1,490 萬美元。2018年第一季度的有效稅率為23.7%，去年同期為33.6%。稅率降低反映了最近頒布的減稅和就業法案對本季度的影響。我們預計全年有效率將在 24% 至 25% 範圍內。

Total net income, including discontinued operations, for the first quarter of 2018 was $8.1 million or $0.26 per diluted share, which includes a $0.1 million loss, net of taxes, from discontinued operations. This compares to the first quarter last year where we reported total net income, including discontinued operations, of $7.1 million or $0.23 per diluted share, which included a net loss from discontinued operations of $1.1 million. Discontinued operations in the prior year included a $1.2 million charge related to the final settlement of a long-standing lawsuit with Biosig Instruments.

2018 年第一季度的淨利潤總額（包括終止經營業務）為 810 萬美元，即稀釋後每股收益 0.26 美元，其中包括來自終止經營業務的 10 萬美元的稅後虧損。相比之下，去年第一季度我們報告的總淨利潤（包括終止經營業務）為 710 萬美元，即每股攤薄收益 0.23 美元，其中包括來自終止經營業務的淨虧損 110 萬美元。上一年停止的業務包括與 Biosig Instruments 長期訴訟的最終和解相關的 120 萬美元費用。

Turning now to our segment results. Net sales in the Direct business totaled $71.2 million in the first quarter of 2018, a 4.7% decrease over the same quarter last year. Direct segment sales were impacted by the continued decline in TreadClimber sales and marginally lower Max Trainer sales. However, sales increases in the Bowflex Results Series and HVT product lines helped to partially offset those declines.

現在轉向我們的部門業績。2018年第一季度直營業務淨銷售額總計7120萬美元，比去年同期下降4.7%。直接部門的銷售額受到 TreadClimber 銷售額持續下降和 Max Trainer 銷售額小幅下降的影響。然而，Bowflex 結果系列和 HVT 產品線的銷量增長有助於部分抵消這些下降。

Gross margin for the Direct business declined to 63% for the first quarter of 2018 compared to 65.5% in the same quarter of last year due to a shift in product mix to more lower-margin HVT and Bowflex Results Series product.

由於產品組合轉向利潤率較低的 HVT 和 Bowflex Results Series 產品，2018 年第一季度 Direct 業務的毛利率下降至 63%，而去年同期為 65.5%。

Operating income for the first quarter of 2018 in our Direct business was $11.3 million compared to $15.3 million in the same quarter prior year. Operating income was negatively impacted by the lower net sales and gross margins in the first quarter of 2018.

2018 年第一季度我們的直接業務營業收入為 1,130 萬美元，而上年同期為 1,530 萬美元。2018年第一季度淨銷售額和毛利率下降對營業收入產生了負面影響。

Net sales in our Retail segment for the first quarter of 2018 were $43 million, an increase of 13.7% compared to $37.8 million in the first quarter of last year. The increase in Retail net sales reflects strong growth across a variety of product lines as well as sales growth in specialty retail and commercial customers.

2018 年第一季度零售部門的淨銷售額為 4300 萬美元，比去年第一季度的 3780 萬美元增長 13.7%。零售淨銷售額的增長反映了各種產品線的強勁增長以及專業零售和商業客戶的銷售增長。

Gross margins for the Retail business decreased by 80 basis points to 31.2% in the first quarter of 2018 as compared to 32% for the prior period, primarily due to higher product costs related to unfavorable foreign exchange rates.

2018年第一季度，零售業務的毛利率下降80個基點至31.2%，而上一季度為32%，主要是由於不利的匯率導致產品成本上升。

In the first quarter of 2018, operating income for the Retail business totaled $3.9 million as compared to $2.2 million in the same period of last year. The increase is attributable to the higher revenue, coupled with a non-recurrence of a $1.2 million reserve recorded in the same period of the prior year.

2018年第一季度，零售業務營業收入總計390萬美元，而去年同期為220萬美元。這一增長歸因於收入增加，以及上一年同期記錄的 120 萬美元準備金不再重複。

Now turning to the consolidated balance sheet. Cash and investments totaled $92.7 million as of March 31, 2018, with $44 million of debt. This compares to $85.2 million in cash, and debt of $48 million at December 31, 2017.

現在轉向合併資產負債表。截至 2018 年 3 月 31 日，現金和投資總額為 9270 萬美元，債務為 4400 萬美元。相比之下，截至 2017 年 12 月 31 日，現金為 8520 萬美元，債務為 4800 萬美元。

During the first quarter, the company purchased $2.7 million of stock in the open market as part of its previously announced stock repurchase program. Inventories were $37.7 million as of March 31, 2018, compared to $53.4 million at December 31, 2017, and $34.3 million at March 31, 2017. The decrease in inventory versus year-end 2017 relates to the seasonality of the business. Trade payables were $41.7 million as of March 31, 2018, compared to $66.9 million at the end of 2017, again, reflecting seasonality of purchases.

第一季度，該公司在公開市場購買了 270 萬美元的股票，作為其先前宣布的股票回購計劃的一部分。截至2018年3月31日，庫存為3770萬美元，而2017年12月31日的庫存為5340萬美元，2017年3月31日的庫存為3430萬美元。與 2017 年底相比，庫存減少與業務的季節性有關。截至 2018 年 3 月 31 日，應付賬款為 4,170 萬美元，而 2017 年底為 6,690 萬美元，這再次反映了採購的季節性。

Capital expenditures totaled $1.3 million for the 3 months ended March 31, 2018, with spending primarily on systems integration, product, equipment and tooling. We anticipate full year CapEx to be in the range of $8.5 million to $10.5 million, reflecting increased spend on systems integration, digital platform enhancements and warehouse consolidation initiatives.

截至 2018 年 3 月 31 日的三個月資本支出總計 130 萬美元，主要用於系統集成、產品、設備和工具。我們預計全年資本支出將在 850 萬美元至 1050 萬美元之間，反映出系統集成、數字平台增強和倉庫整合計劃方面支出的增加。

At this time, I'd like to turn it over to Bill McMahon, our Chief Operating Officer, who will provide additional insights into our business and key products. Bill?

目前，我想將其交給我們的首席運營官 Bill McMahon，他將為我們的業務和關鍵產品提供更多見解。賬單？

Thank you, Sid. Good afternoon, everyone. I'd like to provide further background on our first quarter results and provide some commentary on the opportunities we see in 2018.

謝謝你，席德。大家下午好。我想提供有關我們第一季度業績的更多背景信息，並對我們在 2018 年看到的機會提供一些評論。

Starting with our Retail segment. We were pleased with our 14% sales growth in the first quarter. The Q1 sales increase versus prior year was driven by a number of categories in both the mass retail and specialty fitness space. We experienced solid growth in our Bowflex Results line of cardio products, most notably, our treadmill lineup. The performance of Bowflex treadmills was especially encouraging as traction here will allow Nautilus to continue to gain share in the single-largest category of fitness equipment.

從我們的零售部門開始。我們對第一季度 14% 的銷售額增長感到滿意。第一季度銷售額與上年相比的增長是由大眾零售和專業健身領域的多個類別推動的。我們的 Bowflex Results 有氧運動產品系列經歷了穩健的增長，最引人注目的是我們的跑步機系列。Bowflex 跑步機的表現尤其令人鼓舞，因為這裡的牽引力將使 Nautilus 繼續在單一最大的健身器材類別中獲得份額。

Other contributors to growth included our Bowflex Max Trainer line of products, Schwinn and Octane Airdyne bikes, and both standing and seated elliptical products under the Octane brand. Last fall, we introduced over 20 new SKUs into the market, including products like the Schwinn Crewmaster rower, the Schwinn IC3 indoor cycling bike, the Schwinn 87 and Octane ADX Airdyne bikes, the Octane ZR7000 commercial-quality Zero Runner as well as updates to our popular Schwinn 70 Series line of cardio products. We're encouraged by the initial fitness season performance of these new launches.

其他增長貢獻者包括我們的 Bowflex Max Trainer 系列產品、Schwinn 和 Octane Airdyne 自行車，以及 Octane 品牌下的站立式和坐式橢圓機產品。去年秋天，我們向市場推出了 20 多個新 SKU，包括 Schwinn Crewmaster 划船器、Schwinn IC3 室內自行車、Schwinn 87 和 Octane ADX Airdyne 自行車、Octane ZR7000 商業品質 Zero Runner 等產品以及更新的產品我們廣受歡迎的Schwinn 70 系列有氧運動產品。這些新品在健身季初期的表現令我們深受鼓舞。

Presently, we are in the active selling and planning period for the fall 2018 mass retail fitness season. Based on our current knowledge of those discussions, we continue to hold a positive outlook for the remainder of the year in Retail, as previously outlined in our full year guidance. The continued strength of our current products, along with additional retail introductions for later in the year, have us very well positioned for solid top line growth and market share gains in Retail, including specialty and commercial, in 2018.

目前，我們正處於2018年秋季大眾零售健身季的積極銷售和規劃階段。根據我們目前對這些討論的了解，我們繼續對今年剩餘時間的零售業抱有積極的前景，正如我們之前在全年指導中概述的那樣。我們當前產品的持續強勢，加上今年晚些時候推出的更多零售產品，使我們在 2018 年零售業（包括專業和商業）的穩健營收增長和市場份額增長方面處於有利地位。

One driver of that growth in the commercial space and vertical will be the new Octane Max Trainer MTX machine. This product was designed through collaboration of the Nautilus Octane product development teams. And the new product was recently unveiled during the International Health Racket and Sports Club Association show, better known as IHRSA, in San Diego, California as well as at the International Sporting Goods Trade Fair, or ISPO, in Cologne, Germany. Commercial Max features all the time savings and performance benefits of the consumer Max line but built into a commercial-grade machine. The MTX model of commercial Max is specifically designed to perform well in the rapidly growing functional training area of the commercial club space. The Octane commercial Max Trainer was extremely well received at both major trade shows, and we anticipate this product coming to market in fall of this year.

新型 Octane Max Trainer MTX 機器將成為商業領域和垂直領域增長的推動力之一。該產品是通過 Nautilus Octane 產品開發團隊的合作設計的。該新產品最近在加利福尼亞州聖地亞哥舉行的國際健康球拍和體育俱樂部協會展會（即 IHRSA）以及德國科隆舉行的國際體育用品貿易博覽會（ISPO）上亮相。Commercial Max 具有消費者 Max 系列的所有時間節省和性能優勢，但內置於商業級機器中。Commercial Max的MTX型號專為在商業俱樂部空間快速增長的功能訓練領域表現良好而設計。Octane 商用 Max Trainer 在兩個主要貿易展會上都受到了極大的好評，我們預計該產品將於今年秋季上市。

Turning now to our Direct segment. Our sales declined in Q1, but were in line with our expectations for our full year guidance. The primary driver of decline in the channel year-over-year was TreadClimber. In the prior year, TreadClimber was still in television advertising rotation, whereas in this quarter, the product was not on television. Based on current trend, we believe that Q2 of this year will be the last quarter in which TreadClimber declines will materially impact Direct channel results as compared to prior year.

現在轉向我們的直接部分。我們第一季度的銷售額有所下降，但符合我們對全年指導的預期。該頻道同比下降的主要推動因素是 TreadClimber。去年，TreadClimber 仍在電視廣告中輪播，而在本季度，該產品不再出現在電視上。根據目前的趨勢，我們認為今年第二季度將是 TreadClimber 銷量下降將對直接渠道業績與去年同期相比產生重大影響的最後一個季度。

Additionally, Max Trainer sales in our Direct channel were slightly off for the quarter, but within our expectations as weaker Canada results impacted performance. Overall, for the fitness season, which we define as November through February, Max Trainer sales in Direct were essentially flat, while growing well overall for the full company through both quarters. Meanwhile, we achieved improved sales from our Bowflex HVT machine and with the Bowflex Results Series of cardio products. Further, we launched new versions of our Nautilus and Schwinn e-commerce websites, and we saw lift from those sources.

此外，本季度直接渠道的 Max Trainer 銷售額略有下降，但在我們的預期之內，因為加拿大業績疲軟影響了業績。總體而言，對於健身季（我們將其定義為 11 月至 2 月），Max Trainer 的 Direct 銷售額基本持平，而整個公司在這兩個季度的整體銷售額都增長良好。與此同時，我們的 Bowflex HVT 機器和 Bowflex Results 系列有氧運動產品的銷量也有所提高。此外，我們推出了新版本的 Nautilus 和 Schwinn 電子商務網站，我們看到了這些來源的提升。

During the summer, we'll be introducing another new Direct product that will combine cardio technology from one of Octane's leading products, but now for home use. The Bowflex LateralX machine will utilize the patented cardio modality that is currently unmatched in the consumer market. Lateral training better matches exercise activity with real-world movements. Our Bowflex LateralX will provide low-impact motion that moves your body in 3 dimensions, forward and back, up and down, and side to side, strengthening the user for everyday activities while activating multiple muscle groups. No consumer elliptical or treadmill matches this range of motion. We recently completed user testing with this product, and our results were extremely encouraging. We anticipate Bowflex LateralX launching with 2 models, ranging from $1,999 to $2,700. The product will be supported by television, digital, social and PR advertising.

今年夏天，我們將推出另一款新的 Direct 產品，該產品將結合 Octane 領先產品之一的有氧運動技術，但現在供家庭使用。Bowflex LateralX 機器將利用目前在消費市場上無與倫比的專利有氧運動模式。橫向訓練可以更好地將鍛煉活動與現實世界的動作相匹配。我們的Bowflex LateralX 將提供低衝擊運動，使您的身體在3 個維度上移動，向前和向後、向上和向下、從一側到另一側，增強用戶的日常活動能力，同時激活多個肌肉群。沒有任何消費者橢圓機或跑步機可以與這種運動範圍相匹配。我們最近完成了該產品的用戶測試，結果非常令人鼓舞。我們預計 Bowflex LateralX 將推出 2 種型號，價格從 1,999 美元到 2,700 美元不等。該產品將得到電視、數字、社交和公關廣告的支持。

Based on our current Direct channel performance and the anticipated product launches coming this year, we feel we're on track for the revenue growth outlined in our full year guidance. The launch of Octane commercial Max Trainer and Bowflex LateralX demonstrate continued advancement of the synergies we anticipated during the acquisition of Octane Fitness. Our product development teams are working closely together on still more innovation as part of our 3-year product road map.

根據我們當前的直接渠道業績和今年預計推出的產品，我們認為我們正在實現全年指導中概述的收入增長。Octane 商業 Max Trainer 和 Bowflex LateralX 的推出證明了我們在收購 Octane Fitness 期間預期的協同效應的持續推進。作為我們三年產品路線圖的一部分，我們的產品開發團隊正在密切合作，進行更多創新。

In addition to the products I've discussed today, we continue to make progress in the development of our new digital platform and anticipate launching this capability, which will also include a subscription model, late in the year. For competitive reasons, we'll not be providing more information on this platform today, but we will do so prior to the launch date. Finally, from an operational perspective, we feel that our inventory positions and supplier capacity are well positioned now and for the continued planned growth this year.

除了我今天討論的產品之外，我們還在新數字平台的開發方面繼續取得進展，並預計在今年晚些時候推出此功能，其中還包括訂閱模式。出於競爭原因，我們今天不會提供有關該平台的更多信息，但我們會在發布日期之前提供。最後，從運營角度來看，我們認為我們的庫存狀況和供應商產能現在處於有利位置，可以實現今年的持續計劃增長。

At this point, I'd like to turn the call back over to Bruce for his comments. Bruce?

此時，我想將電話轉回布魯斯以徵求他的意見。布魯斯？

Thank you, Bill. I'd like to make a few final comments before we open up the call for questions. We are pleased with the first quarter results and remain confident in our ability to return to full year top line growth for both Retail and Direct segments this year. While it is still early in the year, we believe we are well positioned to deliver results per our full year guidance given the trajectory of the baseline business in conjunction with the breadth of truly innovative new product introductions still coming that Bill referred to earlier.

謝謝你，比爾。在我們開始提問之前，我想發表一些最後的評論。我們對第一季度的業績感到滿意，並對今年零售和直營部門恢復全年營收增長的能力充滿信心。雖然現在還處於今年年初，但我們相信，考慮到基準業務的發展軌跡，以及比爾之前提到的真正創新的新產品推出的廣度，我們有能力按照全年指引交付成果。

Equally important is that the multifaceted operational improvement plan, which we discussed in the previous call, is tracking as scheduled, and we expect those initiatives to be mostly completed later this year. As a reminder, the operational improvement plan includes systems integration, consolidation of warehouse facilities, supply base realignment, and restructuring of our international sales and support teams. These initiatives are anticipated to strengthen our infrastructure and support our growth initiatives, including new product introductions and improved margins beginning in 2019.

同樣重要的是，我們在上次電話會議中討論的多方面運營改進計劃正在按計劃進行，我們預計這些舉措將在今年晚些時候大部分完成。需要提醒的是，運營改進計劃包括系統集成、倉庫設施整合、供應基地重組以及國際銷售和支持團隊的重組。這些舉措預計將加強我們的基礎設施並支持我們的增長舉措，包括從 2019 年開始推出新產品和提高利潤率。

As far as 2018 guidance, the full year outlook remains the same as communicated on our previous call in March. On a full year basis for 2018, we continue to expect revenues between $428 million and $437 million, with operating income in the range of $42 million to $45 million. This is inclusive of the estimated expenses and investments related to the business model improvements we mentioned.

就 2018 年指引而言，全年展望與我們在 3 月份的電話會議上傳達的內容保持一致。以 2018 年全年為基礎，我們繼續預計收入在 4.28 億美元至 4.37 億美元之間，營業收入在 4200 萬美元至 4500 萬美元之間。這包括與我們提到的商業模式改進相關的估計費用和投資。

Even though we exceeded the first quarter guidance and have started the year well, we feel it is not prudent at this time to change the full year guidance given ongoing product cost pressures and the phasing of investment expenditures to support the key initiatives that remain ahead of us for the balance of this year. While full year expenses and capital expenditures related to the key initiatives are tracking as planned, we now do expect to see heavier concentration of these expenses in the second and third quarters of this year.

儘管我們超出了第一季度的指導，並且今年開局良好，但考慮到持續的產品成本壓力以及分階段投資支出以支持仍然領先的關鍵舉措，我們認為目前改變全年指導並不明智。我們今年的餘額。雖然與關鍵舉措相關的全年支出和資本支出正在按計劃進行，但我們現在預計這些支出將更加集中在今年第二和第三季度。

In closing, I'd like to thank all of our dedicated employees, who are instrumental in our successes and help the company become stronger every quarter as a result of their efforts and initiatives. That concludes our prepared remarks.

最後，我要感謝我們所有敬業的員工，他們對我們的成功發揮了重要作用，並通過他們的努力和舉措幫助公司每個季度變得更加強大。我們準備好的發言到此結束。

Now I'd like to open up the call for questions. Operator?

現在我想開始提問。操作員？

(Operator Instructions) And our first question will come from Michael Swartz with SunTrust.

（操作員說明）我們的第一個問題將來自 SunTrust 的 Michael Swartz。

(technical difficulty)

（技術難度）

As I look through kind of the moving parts here and looking out to back half of 2018, I think you've said for the Direct business, you expect revenue to be down year-over-year in the second quarter. You've given us the guidance for Retail. So I guess the implied growth for Direct would be kind of low teens, pushing towards 20% year-over-year in the back half of the year. So I guess, help us understand the comfort level in that type of growth for the year ahead.

當我回顧這裡的各種變化並展望 2018 年下半年時，我認為您已經說過，對於直接業務，您預計第二季度的收入將同比下降。您為我們提供了零售業指導。因此，我認為 Direct 的隱含增長將在 10 左右左右，下半年將同比增長 20%。所以我想，這有助於我們了解未來一年這種增長的舒適程度。

Yes. I think, the first thing that you have to -- this is Bruce. The first thing you have to remember, Mike, and I apologize, we missed the first few sentences maybe of your question, so we can come back if we're not addressing something, but I think there are several things happening. Number one is that we do have the new product, the LateralX that Bill is alluding to, coming in. That is going to be shipping in the back half. We also have -- keep in mind that the TreadClimber, as Sid has alluded to in earlier calls, that the TreadClimber is not -- the decline of the TreadClimber is becoming really immaterial at the end of Q2. So whereas we had experienced the decline in that heavily in the third and fourth quarter last year and into this year, we will -- that will be behind us from a materiality standpoint. Sid?

是的。我想，你要做的第一件事就是——這是布魯斯。你必須記住的第一件事，邁克，我很抱歉，我們可能錯過了你問題的前幾句話，所以如果我們沒有解決某些問題，我們可以回來，但我認為有幾件事正在發生。第一是我們確實推出了新產品，即 Bill 提到的 LateralX。這將在後半部分發貨。我們還——請記住，TreadClimber，正如 Sid 在之前的電話會議中提到的那樣，TreadClimber 不是——TreadClimber 的下降在第二季度末變得非常無關緊要。因此，儘管我們在去年第三季度和第四季度以及今年經歷了大幅下降，但從實質性角度來看，這將在我們身後。席德？

Yes. And Mike, I would just add sort of the strength we're seeing with the Bowflex Results Series and with the HVT as we go into the back half of the year. Sort of having the tailwinds of that, coupled with not having the TreadClimber headwinds, I think, gives us that confidence in the back half.

是的。邁克，我想補充一下我們在今年下半年看到的 Bowflex 結果系列和 HVT 的實力。我認為，有這樣的順風，加上沒有 TreadClimber 的逆風，讓我們對後半段充滿信心。

Okay. And just on -- in terms of the Max Trainer, I think you said it was down slightly during the quarter. Is that something that you, I guess, anticipate growing in the back half of the year per your guidance? Or should we think of that more flattish?

好的。就 Max Trainer 而言，我想您說過本季度略有下降。我想，根據您的指導，您預計今年下半年會出現增長嗎？或者我們應該把它想得更扁平一些？

Yes. We'd anticipate, certainly by Q4, having some growth in Max Trainer this year. We have some things in the works that we believe give us confidence for that.

是的。我們預計，到第四季度，Max Trainer 今年會有一些增長。我們正在做一些事情，我們相信這讓我們對此充滿信心。

Okay. And then, final question, just on the commercial specialty channel, that's something that's been rocky for a lot of people over the past couple of years. It sounds like that may be finally stabilizing. So maybe just a little more color on what you're seeing there. Is it something market-related that's improving, or is it just kind of the cardio in Bowflex, Nautilus product that's doing better?

好的。然後，最後一個問題，就商業專業頻道而言，這在過去幾年裡對很多人來說一直是個棘手的問題。聽起來這可能終於穩定下來了。所以也許只是給你所看到的多一點色彩。是與市場相關的東西正在改善，還是只是 Bowflex、Nautilus 中的有氧運動產品做得更好？

I'll let -- it's a couple of things, but I think the biggest part of it is that, remember that for the last 2 years, because of a lot of the M&A activity that was occurring in the specialty side of commercial specialty, those stores that were being acquired and consolidated, that seems to have stabilized. We saw some stabilization in the first quarter, I could say, bottoming out. But we do feel that, that is -- that part of the specialty and commercial channel could actually hold its own. It's kind of what we've considered this year not necessarily growing, but at least holding its own versus prior year, on a full year basis. And then, we have, of course, the MTX that Bill alluded to, coming in, in the back half. And all indications are that -- the feedback has been very strong, as we said, both in the shows globally, not just in the U.S., but also from an end-user visits and where we're putting it in the gyms.

我會讓——這有幾件事，但我認為其中最重要的部分是，請記住，在過去的兩年裡，由於商業專業的專業領域發生了很多併購活動，那些被收購和整合的商店似乎已經穩定下來。我可以說，第一季度我們看到了一些穩定，觸底反彈。但我們確實認為，專業和商業渠道的這一部分實際上可以保持自己的地位。我們認為今年不一定會增長，但至少與去年相比，全年保持不變。當然，比爾提到的 MTX 也出現在後半部分。所有跡像都表明，正如我們所說，反饋非常強烈，無論是在全球的展會上，不僅在美國，而且還來自最終用戶的訪問以及我們將其放置在健身房的地方。

Our next question will come from Steve Dyer with Craig-Hallum.

我們的下一個問題將由史蒂夫·戴爾和克雷格·哈勒姆提出。

A couple of questions on the LateralX. First of all, are you able to quantify or willing to quantify sort of how much of this year's revenue guidance implies -- is implied for the LateralX sales? And then, secondly, I think, last quarter, you had talked a little bit about being pretty excited for that launch. I think you had even said it's sort of a potential home-run product. Is there anything that you sort of have seen since then, better or worse, that sort of changes your outlook on that later this year?

關於 LateralX 的幾個問題。首先，您是否能夠量化或願意量化今年的收入指導意味著多少——暗示了 LateralX 的銷售？其次，我認為上個季度，您曾談到對此次發布感到非常興奮。我想你甚至說過這是一種潛在的全壘打產品。從那時起，您所看到的任何事情（無論好壞）是否會改變您對今年晚些時候的看法？

Well, Steve, as you know, we don't provide guidance around individual product category performance, so I will say that our anticipated growth in Direct would require some contribution to come from this product launch indeed. I'm not sure how we'd characterized it previously. I would say we're excited about the product, that's for sure. What gives us some confidence in it is we have been testing this product with users now for many months, and we're getting pretty strong feedback in favor of it. The other side of that is, it's been a successful modality for Octane in the commercial space as well, so we know that user acceptance at the club level has been strong for this product line as well. The challenge has been taking a very complex commercial product and making it accessible for consumers. And I think our engineering teams, together, have done a great job at that, and we're excited to see how the product does. We'll launch it this summer.

好吧，史蒂夫，正如您所知，我們不提供有關單個產品類別性能的指導，所以我想說，我們預期的 Direct 增長確實需要來自該產品發布的一些貢獻。我不確定我們之前是如何描述它的。我想說我們對這個產品感到興奮，這是肯定的。讓我們對它充滿信心的是，我們已經與用戶測試該產品幾個月了，並且我們得到了非常強烈的支持它的反饋。另一方面，Octane 在商業領域也是一種成功的模式，因此我們知道俱樂部級別的用戶對該產品線的接受度也很高。我們面臨的挑戰是如何將一種非常複雜的商業產品提供給消費者。我認為我們的工程團隊在這方面做得非常出色，我們很高興看到該產品的表現。我們將於今年夏天推出。

Great. That's helpful. And then, just jumping over to HVT, I guess. Maybe sounds incrementally more positive relative to the last quarter or two on that launch. Is there anything sort of changed there, in your view, in the last 90 days?

偉大的。這很有幫助。然後，我猜，只是跳到 HVT。相對於該發布的最後一兩個季度，也許聽起來更加積極。您認為過去 90 天內有什麼變化嗎？

No. I think our position has always been that HVT will be a contributor to the company going forward, just not perhaps the home run we were hoping to hit with it. On the other hand, it's definitely contributed. And I anticipate it'll continue to contribute, and in fact, has a possibility of growing some still for us as we go. So I think we've scaled it appropriately is the way I'd describe it.

不。我認為我們的立場一直是 HVT 將成為公司未來發展的貢獻者，但也許不是我們希望用它打出的本壘打。另一方面，它肯定是有貢獻的。我預計它將繼續做出貢獻，事實上，隨著我們的發展，它有可能為我們增加一些。所以我認為我們已經適當地擴展了它，這就是我所描述的方式。

Great. And then, lastly for me, you guys continue with a very strong balance sheet, keep putting more cash on it. I guess, just any changes, sort of your capital allocation plan there, thoughts on maybe accelerating the buyback, et cetera? Or is sort of an acquisition still on the table? And that's it for me.

偉大的。最後，對我來說，你們繼續保持非常強勁的資產負債表，繼續投入更多現金。我想，只是任何變化，比如你的資本配置計劃，關於加速回購的想法等等？或者某種收購仍在討論中？對我來說就是這樣。

Thanks, Steve. Yes -- no, in terms of the capital deployment plan, sort of the priorities remain unchanged. I think we are -- I would say, we're still in the market for an appropriate acquisition, but I think as we've laid out on past calls, it would have to be the right filters and the right asset before we went ahead and did it. But we are on -- certainly in the market, looking for appropriate assets that could accelerate our strategic initiatives that we've outlined here. We'll continue to be in the market opportunistically on the stock buyback program, as we were in Q1.

謝謝，史蒂夫。是的——不，就資本部署計劃而言，某些優先事項保持不變。我認為我們仍然在市場上進行適當的收購，但我認為正如我們在過去的電話會議中所闡述的那樣，在我們進行收購之前，必須有正確的過濾器和正確的資產並做到了。但我們正在——當然是在市場上，尋找合適的資產來加速我們在此概述的戰略舉措。我們將繼續在股票回購計劃中機會主義地進入市場，就像第一季度一樣。

(Operator Instructions) Our next question will come from Michael Kawamoto with D.A. Davidson.

（操作員說明）我們的下一個問題將來自 Michael Kawamoto 和 D.A.戴維森。

So you recently launched the Octane Max Trainer. Looks like it's generating some excitement, and then you have the LateralX. Can you just talk about your plans or maybe additional opportunities to do similar things across the product portfolio, given your ability to [stack] up and down different lines for different channels?

你們最近推出了 Octane Max Trainer。看起來它正在產生一些興奮，然後你就有了 LateralX。鑑於您有能力為不同的渠道上下不同的產品線，您能否談談您的計劃，或者也許有其他機會在整個產品組合中做類似的事情？

Well, I think, we -- Michael, it's a great question. I think we still have more things that we're looking to leverage in terms of modalities across both up and downward, and this year is a great example of going both ways on that. We're not ready at this time to talk about what some of those things might be. But I can tell you, we're very actively working on another modality, as we speak, that we think has potential.

嗯，我想，我們——邁克爾，這是一個很好的問題。我認為我們仍然希望在向上和向下的模式方面利用更多的東西，今年是雙向的一個很好的例子。我們現在還沒有準備好討論其中一些可能是什麼。但我可以告訴你，正如我們所說，我們正在非常積極地研究另一種模式，我們認為這種模式具有潛力。

Awesome. And then, did you give a credit approval for the quarter?

驚人的。然後，您是否批准了本季度的信貸？

The credit approvals were up year-over-year in Q1 to 53.5%, which was up from 52.6%. In both cases, these are at historical highs, to my knowledge. I would still -- I would also add to that and emphasize that credit card as a payment method for the Direct channel still is the majority. In fact, that percentage moved up in Q1 to roughly 55.5%, Sid, I think.

第一季度信貸批准率同比上升至 53.5%，高於去年同期的 52.6%。據我所知，在這兩種情況下，這些都處於歷史高位。我仍然會補充這一點，並強調信用卡作為直接渠道的支付方式仍然佔大多數。事實上，Sid，我認為這一比例在第一季度上升至大約 55.5%。

Yes.

是的。

So we still are seeing what I would call a healthy payment mix, and financing is helping, but we're not overly reliant on financing.

因此，我們仍然看到我所說的健康的支付組合，融資正在發揮作用，但我們並沒有過度依賴融資。

And that does conclude our question-and-answer session for today and I will turn the conference back over to Bruce Cazenave with closing remarks.

我們今天的問答環節到此結束，我將把會議轉回布魯斯·卡澤納夫並發表閉幕詞。

Thank you all for your interest today in Nautilus and joining our call. We look forward to providing another update on the business on our second quarter earnings call in a few months. Hope everyone has a great rest of the day. Thank you.

感謝大家今天對 Nautilus 的關注並加入我們的電話會議。我們期待在幾個月後的第二季度財報電話會議上再次提供有關該業務的最新信息。希望大家度過愉快的一天。謝謝。

Once again, that does conclude our conference for today. Thank you for your participation.

我們今天的會議再次結束。感謝您的參與。