Natural Health Trends Corp. released its first quarter financial results for 2021. While the company reported positive operating income and net income, revenue for the quarter was down 10% to $13.5 million, compared to $14.9 million during the same time period last year. The company attributes this downturn to a $1.1 million increase in deferred revenue, which they expect to recognize as revenue in the second quarter of this year.
“Following a highly productive January, severe government-mandated restrictions and limitations surrounding in-person events and the Chinese New Year holiday restricted our leaders from properly conducting business,” said Chris Sharng, President of Natural Health Trends Corp. “That said, our first quarter order trends sustained positive momentum with order volume approaching levels achieved in the prior year quarter. A strong contributor to our order volume was our January in-person training event which attracted nearly 700 participants. We also saw notable progress in Japan, India, Peru, Europe and Malaysia which all experienced strong top-line growth year-over-year. In an effort to further boost sales, we began the implementation of social selling in select markets to raise awareness and knowledge of our product lines and business opportunity. In addition, our diligent expense management resulted in our fourth consecutive quarter of positive operating income and net income, in addition to our second consecutive quarter of positive cash flow generation.”
The company’s operating income was $220,000, compared to an operating loss of $1.4 million in the first quarter of last year. Net income was also up, totaling $153,000 (or $0.01 per diluted share), compared to a net loss of $573,000 (or $0.05 per diluted share) in the same quarter last year.
The number of active distributors decreased 5% in Q1 2021, down to 49,420 from 52,230 at the end of last year. This is a 13% decrease from the first quarter of 2020.
“Despite having to delay our second Fly-High training to April, the event was successful and exceeded the attendance of our January event with follow-up marketing activities already well underway,” said Mr. Sharng. “Next, we expect to hold our first major in-person event since the beginning of the pandemic in Macau in June, where we intend to introduce a new wellness product, Time Release Ultra B Complex, to an audience of over 1,500. As we continue to emerge from the pandemic, we believe we are well-positioned to begin the process of safely resuming our normal business operations as the economy recovers.”
Total cash and cash equivalents for the company remain strong at $90.2 million, a slight decrease from the end of 2020.