USANA Health Sciences, Inc. announced financial results for its fiscal third quarter that it described as “modestly ahead” of the previous outlook provided in mid-September. The company now expects $130 million of free cash flow in fiscal 2021.
Net sales for the company were down 8% from the same quarter in 2020, totaling $274.4 million. EPS declined by 6%, reaching $1.36 as opposed to $1.44 in the third quarter of 2020.
Also in decline were active customers, which totaled 576,000, an 11% decrease from the third quarter of 2020.
“As we indicated a month ago, the operating environment remains challenging across several of our key markets due, in great part, to disruptions and lockdowns related to the COVID-19 pandemic,” said Kevin Guest, Chief Executive Officer and Chairman of the Board. “Additionally, the year-over-year comparison was difficult given the significant short-term sales program that we offered in the prior year quarter. Notwithstanding these challenges, we continue to execute our growth strategy, which is centered on generating sustainable customer growth.”
Asia-Pacific proved to be the strongest market for the company, with net sales reaching $220.9 million, a 9% decline over the prior year quarter. Active customers in this region totaled 443,000, a 12% decline over Q3 2020.
Net sales for the Americas and Europe region reached $53.5 million and active customers totaled 133,000, a 7% and 10% decline respectively over the same period last year.
At the end of Q3, USANA had $249 million in cash and cash equivalents as well as no debt after repurchasing 523,000 shares for $50 million. Diluted shares outstanding totaled 20.2 million during Q3 2021, with approximately $137 million remaining under the share repurchase authorization.
“We made progress on several strategic initiatives during the quarter,” Guest said. “Enhancing the overall shopping experience for our customers remains a high priority, and to that end, we rolled out additional features and functionality within our China shopping app, as well as a new web-based shopping cart in China. Although our introduction of certain new products has been delayed until 2022, we are actively engaged in bringing new and innovative products to market. Overall, we remain confident that the successful execution of our strategy will deliver long-term, sustainable growth.”
The outlook for fiscal year 2021 continues to include $1.18-$1.20 billion in consolidated net sales and a diluted EPS of $5.80-$6.
“We are reiterating our outlook for fiscal 2021 with third quarter results coming in just ahead of the projections we provided on September 16th,” said Doug Hekking, Chief Financial Officer. “Our outlook incorporates ongoing investments required to achieve long-term growth objectives that may impact near-term operating margins.”
