Nu Skin Enterprises Reports Third Quarter Financial Results

 

PROVO, Utah — Nov. 2, 2022 — Nu Skin Enterprises, Inc. (NYSE: NUS) today announced third quarter 2022 results.

 

Executive Summary

Q3 2022 vs. Prior-year Quarter

Revenue:

$537.8 million; (16)%

·         (7)% FX impact or $(47) million

Earnings Per Share (EPS):

$(0.51) or $0.47 excluding restructuring and impairment charges associated with the company’s strategic resource reallocation, compared to $0.97 in Q3 2021

Customers:

1,239,384; (11)%

Paid Affiliates:

243,276; (11)%

Sales Leaders:

49,824; (22)%

 

“Our third quarter results were impacted more than anticipated by worsening macro headwinds, including prolonged COVID-related disruptions in Mainland China, slowdown in South Korea, persistent global inflation and excessive foreign currency pressure,” said Ryan Napierski, Nu Skin president and CEO. “Despite the challenging macro environment, we further strengthened our position as the world’s leading beauty device system company by introducing our connected ageLOC® LumiSpa® iO. This introduction, which continues in the fourth quarter, along with the expansion of ageLOC® Meta and Beauty Focus Collagen+ products and further advancement of our social commerce initiatives, helped us deliver constant-currency growth in four of our reporting segments. The growth was led by Southeast Asia/Pacific and our tenth consecutive quarter of growth in our U.S. market. Japan and our Taiwan/Hong Kong segments grew in constant currency, with reported currency declines due to unfavorable foreign currency.

 

“We remain focused on Nu Vision 2025 for driving long-term growth and shareholder value as we continue executing against the core elements including the introduction of EmpowerMe, our personalized beauty and wellness strategy, expansion of our affiliate-powered social commerce business model, and the enhancement of our digital platform. With more challenging macro conditions expected over the near to mid-term, we are pursuing a more aggressive tactical approach to our previously indicated restructuring to better align capabilities, resources and operational efficiencies. While these decisions are never easy, the moves we are making will place us in a stronger financial position going forward.”

 

Q3 2022 Year-over-year Operating Results               

Revenue:

$537.8 million compared to $641.2 million

·         (7)% FX impact or $(47) million

Gross Margin:

67.7% or 72.7% excluding restructuring and impairment charges, compared to 75.2%

·         Impacted by geographic footprint, foreign currency and global inflationary pressures

·         Nu Skin business was 73.0% or 76.7% excluding restructuring and impairment charges, compared to 78.6%

Selling Expenses:

40.3%, compared to 40.6%

·         Nu Skin business was 43.5%, compared to 43.5%

G&A Expenses:

25.7%, compared to 24.4%

Operating Margin:

(3.8)% or 6.8% excluding restructuring and impairment charges, compared to 10.2%

Other Income / (Expense):

$(8.7) million or $(5.4) million excluding charges associated with our Q4 2021 exit from Grow Tech, compared to $2.8 million

Income Tax Rate:

12.3% or 24.0% excluding restructuring and impairment charges, compared to 27.0%

EPS:

$(0.51) or $0.47 excluding restructuring and impairment charges, compared to $0.97


Stockholder Value

Dividend Payments:

$19.3 million

Stock Repurchases:

$40.0 million

·         $185.4 million remaining in authorization

 

Q4 and Full-year 2022 Outlook

Q4 2022 Revenue:

$500 to $550 million; (26) to (18)%

·         Approximately (8) to (10)% FX impact

Q4 2022 EPS:

$0.30 to $0.50 or $0.40 to $0.60 non-GAAP

2022 Revenue:

$2.20 to $2.25 billion; (18) to (16)%

·         Approximately (5) to (7)% FX impact

2022 EPS:

$1.25 to $1.45 or $2.40 to $2.60 non-GAAP

 

“Anticipating that the challenging global macro pressures persist, our 2022 revenue guidance is expected to be $2.20 to $2.25 billion, with an approximate 5 to 7 percent foreign currency headwind,” said Mark Lawrence, chief financial officer. “We anticipate reported EPS of $1.25 to $1.45 or $2.40 to $2.60 excluding charges associated with the second-half restructuring and impairment charges and our Q4 2021 exit from Grow Tech. For the fourth quarter, we project revenue of $500 to $550 million, assuming a negative foreign currency impact of approximately 8 to 10 percent, with reported earnings per share of $0.30 to $0.50 or $0.40 to $0.60 when excluding an anticipated fourth-quarter restructuring and impairment charge of approximately $7 to $10 million.”

 

Conference Call

The Nu Skin Enterprises management team will host a conference call with the investment community today at 5 p.m. (ET). Those wishing to access the webcast, as well as the financial information presented during the call, can visit the Investor Relations page on the company's website at ir.nuskin.com. A replay of the webcast will be available on the same page through Nov. 16, 2022.

 

About Nu Skin Enterprises, Inc.

Nu Skin Enterprises, Inc. (NYSE: NUS) is a global integrated beauty and wellness company, powered by a dynamic affiliate opportunity platform. The company helps people look, feel and live their best with products that combine the best of science, technology and nature. Backed by more than 35 years of scientific research, Nu Skin develops innovative products including Nu Skin® personal care, Pharmanex® nutrition and the ageLOC® anti-aging brand which includes an award-winning line of beauty device systems. Nu Skin operates in approximately 50 markets worldwide in the Americas, Asia, Europe, Africa and the Pacific. Rhyz Inc. is the company’s strategic investment arm that includes a collection of technology and manufacturing companies to support growth in the core Nu Skin business. Nu Skin is committed to sustainability, including global initiatives such as transitioning to reduced and sustainable packaging for all products by 2030. The Nu Skin Force for Good Foundation also strives to improve children’s health, education and economic circumstances throughout the world. For more information, visit nuskin.com.

 

Important Information Regarding Forward-Looking Statements: This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, that represent the company’s current expectations and beliefs. All statements other than statements of historical fact are “forward-looking statements” for purposes of federal and state securities laws and include, but are not limited to, statements of management’s expectations regarding the company’s performance, growth, shareholder value, financial position, strategies, vision, transformation, initiatives, product pipeline and product introductions, digital and social-commerce tools and initiatives, customers, sales leaders, affiliates, and operational improvements; projections regarding revenue, expenses, operating income, earnings per share, foreign currency fluctuations, uses of cash and other financial items; statements of belief; and statements of assumptions underlying any of the foregoing. In some cases, you can identify these statements by forward-looking words such as “believe,” “expect,” “anticipate,” “project,” “continue,” “outlook,” “guidance,” “remain,” “become,” “plan,” “potential,” “expand,” “will,” “would,” “could,” “may,” “might,” the negative of these words and other similar words.

 

The forward-looking statements and related assumptions involve risks and uncertainties that could cause actual results and outcomes to differ materially from any forward-looking statements or views expressed herein. These risks and uncertainties include, but are not limited to, the following:

·         risk that epidemics, including the ongoing COVID-19 pandemic, and other crises could negatively impact our business;

·         adverse publicity related to the company’s business, products, industry or any legal actions or complaints by the company’s sales force or others;

·         risk that direct selling laws and regulations in any of the company’s markets, including the United States and Mainland China, may be modified, interpreted or enforced in a manner that results in negative changes to the company’s business model or negatively impacts its revenue, sales force or business, including through the interruption of sales activities, loss of licenses, increased scrutiny of sales force actions, imposition of fines, or any other adverse actions or events;

·         any failure of current or planned initiatives or products to generate interest among the company’s sales force and customers and generate sponsoring and selling activities on a sustained basis;

·         political, legal, tax and regulatory uncertainties, including trade policies, associated with operating in Mainland China and other international markets;

·         uncertainty regarding meeting restrictions and other government scrutiny in Mainland China, as well as negative media and consumer sentiment in Mainland China on our business operations and results;

·         risk of foreign-currency fluctuations and the currency translation impact on the company’s business associated with these fluctuations;

·         uncertainties regarding the future financial performance of the businesses the company has acquired;

·         risks related to accurately predicting, delivering or maintaining sufficient quantities of products to support planned initiatives or launch strategies, and increased risk of inventory write-offs if the company over-forecasts demand for a product or changes its planned initiatives or launch strategies;

·         regulatory risks associated with the company’s products, which could require the company to modify its claims or inhibit its ability to import or continue selling a product in a market if the product is determined to be a medical device or if the company is unable to register the product in a timely manner under applicable regulatory requirements;

·         unpredictable economic conditions and events globally;

·         the company’s future tax-planning initiatives; any prospective or retrospective increases in duties or tariffs on the company’s products imported into the company’s markets outside of the United States; and any adverse results of tax audits or unfavorable changes to tax laws in the company’s various markets; and

·         continued competitive pressures in the company’s markets.

The company’s financial performance and the forward-looking statements contained herein are further qualified by a detailed discussion of associated risks set forth in the documents filed by the company with the Securities and Exchange Commission. The forward-looking statements set forth the company’s beliefs as of the date that such information was first provided, and the company assumes no duty to update the forward-looking statements contained in this release to reflect any change except as required by law.

 

Non-GAAP Financial Measures: Constant-currency revenue change is a non-GAAP financial measure that removes the impact of fluctuations in foreign-currency exchange rates, thereby facilitating period-to-period comparisons of the company’s performance. It is calculated by translating the current period’s revenue at the same average exchange rates in effect during the applicable prior-year period and then comparing that amount to the prior-year period’s revenue. The company believes that constant-currency revenue change is useful to investors, lenders and analysts because such information enables them to gauge the impact of foreign-currency fluctuations on the company’s revenue from period to period.

 

Earnings per share, gross margin, operating margin, other income (expense), and income tax rate, each excluding restructuring and impairment charges and/or charges associated with our Grow Tech exit, also are non-GAAP financial measures. Restructuring and impairment charges and charges associated with our Grow Tech exit are not part of the ongoing operations of our underlying business. The company believes that these non-GAAP financial measures are useful to investors, lenders and analysts because removing the impact of restructuring and impairment charges and charges associated with our Grow Tech exit facilitates period-to-period comparisons of the company’s performance. Please see the reconciliations of these items to our earnings per share and other income (expense) calculated under GAAP, below.

 

The following table sets forth revenue for the three-month periods ended September 30, 2022 and 2021 for each of our reportable segments (U.S. dollars in thousands):

 

 

Three Months Ended

September 30,

 

 

 

Constant-Currency

 

2022

 

2021

 

Change

 

Change

Nu Skin

                     

Americas

$

131,591

 

$

131,482

 

 

 

 

3%

Mainland China

 

75,151

 

 

134,291

 

 

(44)%

 

 

(41)%

Southeast Asia/Pacific

 

83,502

 

 

79,081

 

 

6%

 

 

12%

South Korea

 

67,237

 

 

91,989

 

 

(27)%

 

 

(15)%

Japan

 

53,276

 

 

65,117

 

 

(18)%

 

 

3%

EMEA

 

45,099

 

 

55,839

 

 

(19)%

 

 

(6)%

Hong Kong/Taiwan

 

39,587

 

 

39,921

 

 

(1)%

 

 

6%

Nu Skin other

 

496

 

 

1,672

 

 

(70)%

 

 

(70)%

Total Nu Skin

 

495,939

   

599,392

   

(17)%

   

(9)%

Rhyz Investments

                     

Manufacturing

 

41,328

   

41,635

   

(1)%

   

(1)%

Rhyz other

 

538

   

125

   

330%

   

330%

Total Rhyz Investments

 

41,866

   

41,760

   

   

Total

$

537,805

 

$

641,152

 

 

(16)%

 

 

(9)%

 

 

The following table sets forth revenue for the nine-month periods ended September 30, 2022 and 2021 for each of our reportable segments (U.S. dollars in thousands):

 

 

Nine Months Ended

September 30,

 

 

 

Constant-Currency

 

2022

 

2021

 

Change

 

Change

Nu Skin

                     

Americas

$

379,616

 

$

403,755

 

 

(6)%

 

 

(4)%

Mainland China

 

286,454

 

 

438,066

 

 

(35)%

 

 

(34)%

Southeast Asia/Pacific

 

267,805

 

 

246,338

 

 

9%

 

 

13%

South Korea

 

208,678

 

 

261,724

 

 

(20)%

 

 

(11)%

Japan

 

171,019

 

 

203,001

 

 

(16)%

 

 

(1)%

EMEA

 

148,938

 

 

215,134

 

 

(31)%

 

 

(22)%

Hong Kong/Taiwan

 

117,408

 

 

114,795

 

 

2%

 

 

6%

Nu Skin other

 

2,434

 

 

3,497

 

 

(30)%

 

 

(30)%

Total Nu Skin

 

1,582,352

   

1,886,310

   

(16)%

   

(11)%

Rhyz Investments

                     

Manufacturing

 

119,898

   

135,760

   

(12)%

   

(12)%

Rhyz other

 

1,069

   

163

   

556%

   

556%

Total Rhyz Investments

 

120,967

   

135,923

   

(11)%

   

(11)%

Total

$

1,703,319

 

$

2,022,233

 

 

(16)%

 

 

(11)%

 

 

The following table provides information concerning the number of Customers, Paid Affiliates and Sales Leaders in our core Nu Skin business for the three-month periods ended September 30, 2022 and 2021:

 

 

Three Months Ended

September 30,

   

Customers

2022

 

2021

 

Change

Americas

 

316,123

   

324,884

 

(3)%

Mainland China

 

256,183

   

355,256

 

(28)%

    Southeast Asia/Pacific

 

153,432

   

162,047

 

(5)%

    South Korea

 

134,549

   

156,431

 

(14)%

    Japan

 

121,202

   

123,453

 

(2)%

    EMEA

 

187,906

   

210,705

 

(11)%

    Hong Kong/Taiwan

 

69,989

   

62,491

 

12%

Total

 

1,239,384

   

1,395,267

 

(11)%

 

 

 

Three Months Ended

September 30,

   

Paid Affiliates

2022

 

2021

 

Change

    Americas

 

44,745

   

50,619

 

(12)%

Mainland China

 

23,088

   

32,167

 

(28)%

    Southeast Asia/Pacific

 

40,624

   

43,298

 

(6)%

    South Korea

 

47,852

   

54,119

 

(12)%

    Japan

 

38,119

   

38,315

 

(1)%

    EMEA

 

31,409

   

36,245

 

(13)%

    Hong Kong/Taiwan

 

17,439

   

18,872

 

(8)%

Total

 

243,276

   

273,635

 

(11)%

 

 

 

Three Months Ended

September 30,

   

Sales Leaders

2022

 

2021

 

Change

Americas

 

9,545

   

11,889

 

(20)%

Mainland China(1)

 

11,897

   

19,392

 

(39)%

    Southeast Asia/Pacific

 

7,618

   

7,623

 

    South Korea

 

6,992

   

8,929

 

(22)%

    Japan

 

6,063

   

6,007

 

1%

    EMEA

 

4,777

   

6,417

 

(26)%

    Hong Kong/Taiwan

 

2,932

   

3,629

 

(19)%

Total

 

49,824

   

63,886

 

(22)%

(1)  The September 30, 2022 number reflects a modified Sales Leader definition, as described in our third quarter Form 10-Q.

 

“Customers” are persons who have purchased directly from the Company during the three months ended as of the date indicated. Our Customer numbers include members of our sales force who made such a purchase, including Paid Affiliates and those who qualify as Sales Leaders, but they do not include consumers who purchase products directly from members of our sales force.


“Paid Affiliates” are any Brand Affiliates, as well as sales employees and independent marketers in Mainland China, who earned sales compensation during the three-month period. In all of our markets besides Mainland China, we refer to members of our independent sales force as “Brand Affiliates” because their primary role is to promote our brand and products through their personal social networks.

 

“Sales Leaders” are the three-month average of our monthly Brand Affiliates, as well as sales employees and independent marketers in Mainland China, who had achieved certain qualification requirements as of the end of each month of the quarter.

 

NU SKIN ENTERPRISES, INC.

Consolidated Statements of Income (Unaudited)

(U.S. dollars in thousands, except per share amounts)

 

 

Three Months Ended

September 30,

 

Nine Months Ended

September 30,

 

2022

 

2021

 

2022

 

2021

Revenue

$

537,805

 

$

641,152

 

$

1,703,319

 

$

2,022,233

Cost of sales

 

173,500

 

 

158,907

 

 

483,099

 

 

501,448

Gross profit

 

364,305

 

 

482,245

 

 

1,220,220

 

 

1,520,785

 

 

 

 

 

 

 

 

 

 

 

 

Operating expenses:

 

 

 

 

 

 

 

 

 

 

 

Selling expenses

 

216,478

 

 

260,333

 

 

678,603

 

 

816,887

General and administrative expenses

 

137,987

 

 

156,528

 

 

428,105

 

 

490,225

 

Restructuring and impairment expenses

 

 

30,124

   

   

30,124

   

Total operating expenses

 

384,589

 

 

416,861

 

 

1,136,832

 

 

1,307,112

 

 

 

 

 

 

 

 

 

 

 

 

Operating income (loss)

 

(20,284)

 

 

65,384

 

 

83,388

 

 

213,673

Other income (expense), net

 

(8,680)

 

 

2,781

 

 

(18,773)

 

 

351

 

 

 

 

 

 

 

 

 

 

 

 

Income before provision for income taxes

 

(28,964)

 

 

68,165

 

 

64,615

 

 

214,024

Provision (benefit) for income taxes

 

(3,574)

 

 

18,436

 

 

17,052

 

 

57,527

 

 

 

 

 

 

 

 

 

 

 

 

Net income (loss)

$

(25,390)

 

$

49,729

 

$

47,563

 

$

156,497

 

 

 

 

 

 

 

 

 

 

 

 

Net income (loss) per share:

 

 

 

 

 

 

 

 

 

 

 

Basic

$

(0.51)

 

$

0.99

 

$

0.95

 

$

3.11

Diluted

$

(0.51)

 

$

0.97

 

$

0.94

 

$

3.03

 

 

 

 

 

 

 

 

 

 

 

 

Weighted-average common shares outstanding (000s):

 

 

 

 

 

 

 

 

 

 

 

Basic

 

50,199

 

 

50,098

 

 

50,187

 

 

50,304

Diluted

 

50,199

 

 

51,260

 

 

50,822

 

 

51,629

 

 

NU SKIN ENTERPRISES, INC.

Consolidated Balance Sheets (Unaudited)

(U.S. dollars in thousands)

 

 

September 30,

2022

 

December 31,

2021

ASSETS

 

 

 

Current assets:

 

 

 

Cash and cash equivalents

$

294,136

 

$

339,593

Current investments

 

13,868

 

 

15,221

Accounts receivable, net

 

47,991

 

 

41,299

Inventories, net

 

327,481

 

 

399,931

Prepaid expenses and other

 

94,366

 

 

76,906

 Total current assets

 

777,842

 

 

872,950

 

 

 

 

 

 

Property and equipment, net

 

433,367

 

 

453,674

Operating lease right-of-use assets

 

105,103

   

120,973

Goodwill

 

206,432

 

 

206,432

Other intangible assets, net

 

68,743

 

 

76,991

Other assets

 

171,685

 

 

175,460

Total assets

$

1,763,172

 

$

1,906,480

 

 

 

 

 

 

LIABILITIES AND STOCKHOLDERS’ EQUITY

 

 

 

 

 

Current liabilities:

 

 

 

 

 

Accounts payable

$

41,620

 

$

49,993

Accrued expenses

 

281,418

 

 

372,201

Current portion of long-term debt

 

42,500

 

 

107,500

 Total current liabilities

 

365,538

 

 

529,694

 

         

Operating lease liabilities

 

78,053

 

 

88,759

Long-term debt

 

382,323

 

 

268,781

Other liabilities

 

95,324

 

 

106,474

Total liabilities

 

921,238

 

 

993,708

 

 

 

 

 

 

Commitments and contingencies

 

 

 

 

 

 

 

 

 

 

 

Stockholders’ equity:

 

 

 

 

 

Class A common stock – 500 million shares authorized, $0.001 par value, 90.6 million shares issued

 

91

 

 

91

Additional paid-in capital

 

609,886

 

 

601,703

Treasury stock, at cost – 40.9 million and 40.7 million shares

 

(1,559,967)

 

 

(1,526,860)

Accumulated other comprehensive loss

 

(109,385)

 

 

(73,896)

Retained earnings

 

1,901,309

 

 

1,911,734

Total stockholders' equity

 

841,934

 

 

912,772

Total liabilities and stockholders’ equity

$

1,763,172

 

$

1,906,480

 

 

 

NU SKIN ENTERPRISES, INC.

 

 

Reconciliation of Gross Margin Excluding Impact of Restructuring and Impairment to GAAP Gross Margin

 

 

(in thousands, except per share amounts)

 

 

 

Three Months Ended

 

Nine Months Ended

 

September 30,

 

September 30,

 

2022

 

2021

 

2022

 

2021

 

 

 

 

 

 

 

 

Gross Profit

$ 364,305

 

$ 482,245

 

$1,220,220

 

$ 1,520,785

Impact of restructuring and impairment:

 

 

 

 

 

 

 

    Inventory write-off

     26,905

 

              —

 

      26,905

 

                —

Adjusted Gross Profit

$  391,210

 

$ 482,245

 

$  1,247,125

 

$ 1,520,785

 

 

 

 

 

 

 

 

Gross margin

        67.7%

 

        75.2%

 

         71.6%

 

         75.2%

Gross margin, excluding restructuring and impairment impact

       72.7%

 

        75.2%

 

         73.2%

 

         75.2%

 

 

 

 

 

 

 

 

Revenue

$ 537,805

 

$    641,152

 

$  1,703,319

 

$2,022,233

                   

 

NU SKIN ENTERPRISES, INC.

Reconciliation of Core Nu Skin Business Gross Margin Excluding Impact of Restructuring and Impairment to GAAP Gross Margin

(in thousands, except per share amounts)

 

 

 

Three Months Ended September 30,

 

 

2022

 

 

 

 

Gross Profit

$                      361,895

 

Impact of restructuring and impairment:

 

 

    Inventory write-off

                           18,549

 

Adjusted Gross Profit

$                      380,444

 

 

 

 

Gross margin

             73.0%

 

Gross margin, excluding restructuring and impairment impact

             76.7%

 

 

 

 

Revenue

$                     495,939

 

 

 

 

NU SKIN ENTERPRISES, INC.

 

 

Reconciliation of Operating Margin Excluding Impact of Restructuring to GAAP Operating Margin

 

 

(in thousands, except per share amounts)

 

 

 

Three Months Ended

 

Nine Months Ended

 

September 30,

 

September 30,

 

2022

 

2021

 

2022

 

2021

 

 

 

 

 

 

 

 

Operating income (loss)

$ (20,284)

 

$    65,384

 

$    83,388

 

$    213,673

Impact of restructuring and impairment:

 

 

 

 

 

 

 

        Restructuring and impairment

      30,124

 

              —

 

       30,124

 

                —

    Inventory write-off

     26,905

 

              —

 

      26,905

 

                —

Adjusted operating income

$   36,745

 

$   65,384

 

$    140,417

 

$    213,673

 

 

 

 

 

 

 

 

Operating margin

       (3.8)%

 

        10.2%

 

          4.9%

 

          10.6%

Operating margin, excluding restructuring and impairment impact

         6.8%

 

        10.2%

 

          8.2%

 

          10.6%

 

 

 

 

 

 

 

 

Revenue

$ 537,805

 

$   641,152

 

$ 1,703,319

 

$2,022,233

                   

 

 

NU SKIN ENTERPRISES, INC.

 

 

Reconciliation of Other Income (Expense), Net Excluding Charges Associated with our Q4 2021 Exit from Grow Tech to GAAP Operating Margin

 

 

(in thousands, except per share amounts)

 

 

 

Three Months Ended

 

Nine Months Ended

 

September 30,

 

September 30,

 

2022

 

2021

 

2022

 

2021

 

 

 

 

 

 

 

 

Other income (expense), net

$   (8,680)

 

$       2,781

 

$    (18,773)

 

$          351

Impact of charges associated with our Q4 2021 exit from Grow Tech:

 

 

 

 

 

 

 

    Unrealized investment loss

       3,298

 

              —

 

        9,009

 

              —

Adjusted Other income (expense), net

$   (5,382)

 

$       2,781

 

$     (9,764)

 

$          351

 

 

 

 

 

 

 

 

                   

NU SKIN ENTERPRISES, INC.

Reconciliation of Effective Tax Rate Excluding Impact of Restructuring to GAAP Effective Tax Rate

(in thousands, except per share amounts)

 

 

Three Months Ended

 

Nine Months Ended

 

September 30,

 

September 30,

 

2022

 

2021

 

2022

 

2021

 

 

 

 

 

 

 

 

Provision (benefit) for income taxes

$    (3,574)

 

$     18,436

 

$     17,052

 

$     57,527

Impact of restructuring on tax provision

       11,095

 

               —

 

        11,554

 

               —

Provision for income taxes, excluding impact of restructuring

$       7,521

 

$     18,436

 

$    28,606

 

$     57,527

 

 

 

 

 

 

 

 

Income (loss) before provision for income taxes

$ (28,964)

 

$     68,165

 

$     64,615

 

$   214,024

Impact of restructuring and impairment:

 

 

 

 

 

 

 

        Restructuring and impairment

      30,124

 

               —

 

        30,124

 

                —

       Inventory write-off

     26,905

 

               —

 

      26,905

 

                —

Impact of charges associated with our Q4 2021 exit from Grow Tech:

 

 

 

 

 

 

 

        Unrealized investment loss

       3,298

 

               —

 

        9,009

 

               —

Income before provision for income taxes, excluding restructuring and impairment impact

$    31,363

 

$     68,165

 

$   130,653

 

$   214,024

 

 

 

 

 

 

 

 

Effective tax rate

        12.3%

 

        27.0%

 

        26.4%

 

        26.9%

Effective tax rate, excluding restructuring and impairment impact

       24.0%

 

        27.0%

 

         21.9%

 

        26.9%

 

 

NU SKIN ENTERPRISES, INC.

 

 

Reconciliation of Earnings Per Share Excluding Impact of Restructuring and Impairment to GAAP Earnings Per Share

 

 

(in thousands, except per share amounts)

 

 

 

Three Months Ended

 

Nine Months Ended

 

September 30,

 

September 30,

 

2022

 

2021

 

2022

 

2021

 

 

 

 

 

 

 

 

Net income (loss)

$ (25,390)

 

$    49,729

 

$    47,563

 

$   156,497

Impact of restructuring and impairment:

 

 

 

 

 

 

 

        Restructuring and impairment

      30,124

 

              —

 

       30,124

 

              —

    Inventory write-off

     26,905

 

              —

 

     26,905

 

              —

    Income tax impact

    (10,469)

 

 

     (10,469)

 

Impact of charges associated with our Q4 2021 exit from Grow Tech:

 

 

 

 

 

 

 

       Unrealized investment loss

       3,298

 

 

9,009

 

       Income tax impact

        (626)

 

              —

 

       (1,085)

 

               —

Adjusted net income

$   23,842

 

$    49,729

 

$  102,047

 

$   156,497

 

 

 

 

 

 

 

 

Diluted earnings per share

$      (0.51)

 

$        0.97

 

$        0.94

 

$         3.03

Diluted earnings per share, excluding restructuring and impairment impact

$       0.47

 

$        0.97

 

$         2.01

 

$         3.03

 

 

 

 

 

 

 

 

Weighted-average common shares outstanding (000s):

 

50,199

 

51,260

 

50,822

 

 

51,629

 

NU SKIN ENTERPRISES, INC.

Reconciliation of Earnings Per Share Excluding Certain Charges to GAAP Earnings Per Share

 

 

Three Months Ended

 

Year Ended

 

December 31, 2022

 

December 31, 2022

 

Low End

 

High End

 

Low End

 

High End

 

 

 

 

 

 

 

 

Earnings per share

$       0.30

 

$        0.50

 

$         1.25

 

$          1.45

Impact of charges associated with our second half restructuring and impairment charges:

 

 

 

 

 

 

 

        Restructuring and Impairment

0.18

 

0.18

 

0.77

 

0.77

       Inventory write-off

  —

 

  —

 

0.53

 

0.53

       Income tax impact

(0.07)

 

(0.07)

 

(0.29)

 

(0.29)

Impact of charges associated with our Q4 2021 exit from Grow Tech:

 

 

 

 

 

 

 

       Unrealized investment loss

              —

 

  —

 

0.18

 

0.18

       Income tax impact

        (0.01)

 

         (0.01)

 

        (0.04)

 

         (0.04)

Adjusted Earnings per share

$       0.40

 

$        0.60

 

$        2.40

 

$        2.60

                   

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