Financial News, November 2013
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Primerica Inc.
Primerica Inc. (PRI—NYSE), the largest independent financial services marketing company in North America, announced financial results for the quarter ended June 30, 2013. Total revenues were $312.3 million in the second quarter of 2013 and net income was $43.5 million, or 74 cents per diluted share.
In the second quarter of 2013 operating revenues increased by 4 percent to $308.8 million, compared with $296.2 million in the second quarter of 2012—driven by strong Investment and Savings Products performance and growth in Term Life net premium, partially offset by lower net investment income. Net operating income was $41.4 million in the second quarter of 2013, compared with $45.5 million in the prior year period, while net operating income of 71 cents per diluted share remained consistent with the second quarter of 2012, partially due to the retirement of $155 million of Primerica common stock and warrants. Net operating income was negatively impacted by higher expenses related to the move to the company’s new headquarters as well as legal fees and expenses. Net income return on stockholders’ equity (ROE) was strong at 14.2 percent (14.6 percent on a net operating income and adjusted stockholders’ equity [ROAE] basis) for the quarter ended June 30, 2013.
As of June 30, 2013, investments and cash totaled $1.88 billion, compared with $2.12 billion as of March 31, 2013.
In other company news, the board of directors approved payment of a quarterly dividend of 11 cents per share for the second quarter of 2013. The dividend was payable on Sept. 10, 2013, to stockholders of record as of Aug. 23, 2013.
Youngevity International Inc.
Youngevity International Inc. (YGYI—OTCQX), a global direct marketer of nutritional and lifestyle products and also a vertically integrated producer of fine coffees, reported its financial results for the second quarter and first six months of 2013.
Fiscal 2013 Second Quarter Results
For the second fiscal quarter ended June 30, 2013, Youngevity International’s revenue increased 8.9 percent to $20.9 million, compared to $19.2 million for the same period in fiscal 2012.
Youngevity International’s gross profit for the second fiscal quarter ended June 30, 2013, increased approximately 15.5 percent to $12.7 million, compared to $11.0 million recorded in the same period last year.
The company reported second fiscal quarter 2013 net income of $662,000, compared to a net loss of ($36,000) for the quarter ended June 30, 2012.
As of June 30, 2013, the company’s cash and cash equivalents were $3.6 million and working capital was $2.5 million, compared to cash and cash equivalents of $3.0 million and a working capital of $1.4 million as of Dec. 31, 2012.
Fiscal 2013 First Six Months Results
For the six months ended June 30, 2013, the company reported net revenue of $41.7 million, compared to $35.2 million for the same period in fiscal 2012, an 18.5 percent increase. Gross profit for the second quarter of fiscal year 2013 increased 25.5 percent to $25.1 million, compared to $20.0 million in the prior year period.
Net income for the second quarter of fiscal year 2013 was $1.7 million, compared to a net loss of $887,000 reported in the same period in fiscal 2012.
EBITDA was $3.9 million for the six months ended June 30, 2013, compared to $732,000 in the same period for the prior year.
Crius Energy Trust
Crius Energy Trust (KWH-UN.TO—TORONTO) announced its financial results for the three-month period ended June 30, 2013. The Trust commenced operations on Nov. 13, 2012, with the acquisition of a 26.8 percent ownership interest in Crius Energy LLC by the Trust’s wholly owned subsidiary. All figures in U.S. dollars unless otherwise noted.
Revenue for the quarter ending June 30, 2013, was $113.9 million and was driven by robust customer growth in the first half of the year and higher retail rates.
Gross margin for the period was $27.6 million, representing 24.2 percent of revenue. Monthly gross margins were 24.3 percent in April, 26.9 percent in May and 22.1 percent in June.
Adjusted EBITDA for the period was $10.1 million, or 8.9 percent of revenue. Adjusted EBITDA was negatively impacted by an estimated $0.9 million due to lower-than-normal electricity volumes in June, $0.9 million as a result of customer rate increases not implemented as part of the transition of billing systems in April 2013, and $1.9 million related to nonrecurring expenses stemming from the investment in the integration of pre-IPO legacy IT platforms.
The company’s balance sheet improved in the period with total cash availability increasing to $32.1 million. The total cash availability consists of $18.5 million in cash, no long-term debt and availability of $13.6 million under the company’s working capital facility.
The company’s Viridian Energy brand added more than 35,000 customers and 3,800 independent contractors to its network marketing channel. Management sees the higher-usage, higher-retention Viridian marketing channel as a key source of long-term revenue growth that will help support distributions in the future.
LifeVantage Corp.
LifeVantage Corp. (LFVN—NASDAQ), a science-based network marketing company, reported financial results for the fiscal 2013 fourth quarter and the full year ended June 30, 2013.
Fiscal 2013 Fourth Quarter Results
For the fourth fiscal quarter ended June 30, 2013, the company reported net revenue of $51.5 million, compared with $44.6 million for the same period in fiscal 2012, an increase of 15.5 percent. Revenue for the quarter was negatively impacted 7.3 percent by foreign currency fluctuation.
Gross profit for the fourth fiscal quarter ended June 30, 2013, increased to $44.2 million, compared to $38.2 million for the same period last year, delivering a gross margin of 85.8 percent, compared with 85.6 percent in the prior year period.
Operating income for the fourth fiscal quarter of 2013 was $0.2 million, compared to $7.3 million in the same period last year. Operating income for the fourth fiscal quarter of 2013 includes a $1.7 million expense associated with the retirement of Dr. Joe McCord, the company’s former Chief Science Officer, and a $1.6 million expense associated with the launch of the company’s MyLifeVenture program. Operating margin in the fourth fiscal quarter of 2013 was 0.5 percent, compared to 16.5 percent in the prior year period.
Net loss for the fourth quarter of fiscal year 2013 was $0.2 million, or zero cents per diluted share. This compares to net income in the fourth quarter of fiscal year 2012 of $4.8 million, or 4 cents per diluted share.
Fiscal 2013 Full Year Results
For the full year ended June 30, 2013, the company reported net revenue of $208.2 million, compared to $126.2 million in fiscal year 2012, a 65.0 percent increase. Revenue for the full year was negatively impacted 5.0 percent by foreign currency fluctuation.
Operating income in fiscal year 2013 was $12.1 million, which includes the impact of $5.0 million of net product-recall related costs as well as the aforementioned expenses related to the retirement of the company’s Chief Science Officer and the launch of MyLifeVenture. This compares to operating income of $21.5 million in the prior year.
Net income for fiscal year 2013 was $7.6 million, or 6 cents per diluted share, which includes the impact of net recall-related-costs and the aforementioned operating expenses incurred in the fourth quarter, compared to $12.5 million, or 11 cents per diluted share, in fiscal year 2012.
Excluding product recall costs, non-GAAP gross profit, operating income, net income and diluted earnings per share for the full fiscal year ended June 30, 2013, were $176.3 million or 84.7 percent, $17.1 million or 8.2 percent, $11.0 million and 9 cents, respectively.
The company’s cash and cash equivalents at June 30, 2013, were $26.3 million, compared to $24.6 million at the end of fiscal year 2012. The company generated $10.7 million in cash flow from operations in the full fiscal year 2013.
During fiscal year 2013, the company authorized two separate $5 million stock repurchase programs pursuant to which the company repurchased a total of approximately 3 million shares for $7.1 million. The remaining $2.9 million of authorized share repurchases, or approximately 1.1 million shares, were completed during the first quarter of fiscal 2014.
LifeVantage commenced its modified Dutch auction tender offer Sept. 24, 2013. Through the tender offer, the company offered to purchase up to $40 million of its common stock at a price per share not less than $2.45 and not greater than $2.80. The tender offer expired on Oct. 25, 2013.
The company expects to enter into a new credit facility to fund the share purchases in the tender offer. The tender offer will be subject to the completion of the new credit facility and other customary conditions that are described in the tender offer materials.
D.A. Davidson & Co. will be the dealer manager for the tender offer. Georgeson Inc. will serve as information agent for the tender offer, and Computershare will serve as depository for the tender offer.
Natural Health Trends Corp.
Natural Health Trends Corp. (NHTC—OTC.BB), a direct selling company that markets premium quality personal-care, wellness and “quality of life” products under the NHT Global brand, announced financial results for the quarter and six months ended June 30, 2013.
Total revenues for the second quarter were $10.6 million, compared to $11.0 million in the second quarter last year, and up sequentially from the $8.7 million in the first quarter. This was the second consecutive quarterly increase in revenues.
Operating income was $948,000, an increase of 7 percent, compared to $889,000 last year. Net income was $904,000, or 8 cents per diluted share, compared to $846,000, or 8 cents per diluted share, last year.
Cash and cash equivalents increased to $6.7 million as of June 30, 2013, from $4.2 million at Dec. 31, 2012. Net working capital turned positive for the first time since early 2007.
RBC Life Sciences Inc.
RBC Life Sciences Inc. (RBCL—OTC.BB), a provider of proprietary nutritional supplements, reported consolidated net sales of $6.7 million for the second quarter of 2013, a 2 percent increase over the second quarter of 2012.
For the second quarter of 2013, the company reported a net loss of $147,000, or 1 cent per share, compared to net earnings of $320,000, or 1 cent per share, for the same quarter last year. Gross profit was $3.0 million, compared to $3.5 million the previous year. According to RBC Life Sciences CEO Clinton H. Howard, net sales of Nutritional Products have been positive, increasing 8 percent for the second quarter of 2013, compared to the previous year.
Net sales were $12.4 million for the six months ended June 30, 2013, a 2 percent decrease over the same period in 2012. The company reported a net loss of $155,000, or 1 cent per share, compared to net earnings of $247,000, or 1 cent per share for the comparable period in 2012. Gross profit was $5.9 million compared to $6.6 million the previous year.
Educational Development Corp.
Educational Development Corp. (EDUC—NASDAQ) announced their quarterly cash dividend.
The board of directors has authorized an 8 cents per share cash dividend. The dividend was payable on Sept. 20, 2013, to shareholders of record Sept. 13, 2013.
Educational Development Corp. sells children’s books, including Usborne Books and the Kane/Miller line of international children’s titles, through a multi-level sales organization of independent consultants, through 5,000 retail stores and over the Internet.
Direct Selling News has accumulated this information from public sources, including press releases and SEC filings. The information is presumed accurate and reliable. However, it is not an endorsement of any investment opportunity. Proper and considerable due diligence should be completed before making any investment.
