USANA Health Sciences (USNA—NYSE) is the newest member of direct selling’s Billion Dollar Club, with annual sales exceeding $1 billion.
Management on Tuesday reported revenue of $1.006 billion for 2016, a record for the Salt Lake City-based company. Once again, sales and Associate growth in the Asia-Pacific region drove the positive results. Net income was $100.0 million, or $3.99 per share, an 11 percent increase over 2015. Overall, the company saw a 12 percent increase in active Associates.
“2016 was another exceptional year for USANA,” said Kevin Guest, CEO, in a news release. “We surpassed the $1 billion mark in net sales, generating our 14th consecutive year of record sales, and we reported the highest EPS in the history of the company. On top of these achievements, we successfully launched our new Incelligence product platform, which illustrates the evolution of USANA’s vision of product personalization.”
InCelligence is a cell-signaling technology developed by USANA scientists. Already, the company has incorporated this U.S. patent-pending technology into its core nutrition product, CellSentials, and a handful of others, but going forward it will serve as the foundation of USANA’s entire product portfolio. In addition to developing InCelligence, this year management is focusing on growth initiatives and major investments in global IT infrastructure.
The company closed out the year with fourth-quarter revenue of $252.9 million, up 9 percent from a year earlier. A stronger U.S. dollar cut net sales by $9.2 million in the quarter. Revenue narrowly missed the $253.5 million predicted by analysts, in a poll by Thomson Reuters.
The largest gains occurred in the Asia-Pacific region, where sales rose 12 percent to $193.4 million. North Asia led the region with 23 percent year-over-year growth. In the combined Americas and Europe region, results were mixed, amounting to a 2 percent decrease in quarterly sales. On a constant-currency basis, Mexico and Canada were up 26 percent and 13 percent, respectively, while sales in the U.S. fell 11 percent.
Quarterly earnings were 87 cents per share, compared with 92 cents in the same period of 2015. Analysts had expected earnings of 94 cents per share.
Management also said USANA is conducting an internal review of its China operations, Baby Care Ltd. The voluntary investigation focuses on compliance with the Foreign Corrupt Practices Act, as it relates to expense reimbursement and other policies. The company did not put forth a timeline for the investigation, which is still in the early stages.
Looking to 2017, USANA sees full-year revenue in the range of $1.04 billion to $1.07 billion, with earnings per share of $3.80 to $4.10.