Nu Skin Enterprises (NUS) has reported a 728.98 percent jump in profit for the quarter ended Mar. 31, 2017. The company has earned $27.49 million, or $0.51 a share in the quarter, compared with $3.32 million, or $0.06 a share for the same period last year. Revenue during the quarter grew 5.78 percent to $499.10 million from $471.83 million in the previous year period. Gross margin for the quarter expanded 693 basis points over the previous year period to 77.71 percent. Total expenses were 90.73 percent of quarterly revenues, down from 98.27 percent for the same period last year. This has led to an improvement of 754 basis points in operating margin to 9.27 percent.
Operating income for the quarter was $46.26 million, compared with $8.15 million in the previous year period.
"We are pleased to deliver strong first-quarter results, which demonstrates the progress we made executing on our strategic priorities to increase customer trial and acquisition," said Ritch Wood, chief executive officer. "Our quarterly results reflect solid growth in Mainland China, South Asia/Pacific and EMEA. Our expanding social selling efforts and the continued rollout of ageLOC Me and ageLOC Youth contributed to our strong revenue during the quarter, positioning us to deliver solid performance for 2017."
For the second-quarter 2017, Nu Skin Enterprises expects revenue to be in the range of $530 million to $550 million. The company projects diluted earnings per share to be in the range of $0.65 to $0.70 for the second-quarter.
For financial year 2017, Nu Skin Enterprises expects revenue to be in the range of $2,260 million to $2,300 million. The company projects diluted earnings per share to be in the range of $3.10 to $3.25.
Working capital increases
Nu Skin Enterprises has recorded an increase in the working capital over the last year. It stood at $310.92 million as at Mar. 31, 2017, up 5.72 percent or $16.83 million from $294.10 million on Mar. 31, 2016. Current ratio was at 1.79 as on Mar. 31, 2017, up from 1.66 on Mar. 31, 2016. Cash conversion cycle (CCC) has decreased to 79 days for the quarter from 164 days for the last year period. Days sales outstanding were almost stable at 6 days for the quarter, when compared with the last year period.
Days inventory outstanding has decreased to 102 days for the quarter compared with 178 days for the previous year period. At the same time, days payable outstanding went up to 29 days for the quarter from 21 for the same period last year.
Debt increases substantially
Nu Skin Enterprises has witnessed an increase in total debt over the last one year. It stood at $428.48 million as on Mar. 31, 2017, up 62.88 percent or $165.41 million from $263.07 million on Mar. 31, 2016. Total debt was 28.67 percent of total assets as on Mar. 31, 2017, compared with 17.41 percent on Mar. 31, 2016. Debt to equity ratio was at 0.62 as on Mar. 31, 2017, up from 0.33 as on Mar. 31, 2016.
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