Financial Performance - Revenue for Q1 2025 was $10.7 million, a decrease of 2% compared to $11.0 million in Q1 2024[7] - Operating loss for Q1 2025 was $345,000, an improvement from a loss of $365,000 in Q1 2024[7] - Net income for Q1 2025 was $122,000, or $0.01 per diluted share, compared to $188,000, or $0.02 per diluted share in Q1 2024[7] - Cash flows from operations were $484,000 in Q1 2025, down from $549,000 in Q1 2024[11] - Total cash, cash equivalents, and marketable securities were $41.9 million at March 31, 2025, down from $43.9 million at December 31, 2024[11] - The total assets decreased to $53.2 million as of March 31, 2025, from $55.4 million at December 31, 2024[14] Membership and Orders - Active Members decreased by 2% to 30,180 as of March 31, 2025, down from 30,870 at December 31, 2024, and down 5% from 31,620 at March 31, 2024[7] - The company experienced a 9% sequential increase in orders taken compared to Q4 2024, indicating sustained interest in its products[5] Dividends and Manufacturing Strategy - The company declared a quarterly cash dividend of $0.20 per share, payable on May 23, 2025[11] - The company is working to align manufacturing closer to key markets to improve long-term efficiency amid trade uncertainties[6]

Core Viewpoint - Natural Health Trends Corp. reported a 2% year-over-year revenue decrease for Q1 2025, attributed to promotional calendar differences, but showed a 9% sequential increase in orders from Q4 2024, indicating strong customer interest in their products [4][8]. Financial Performance - Revenue for Q1 2025 was $10.7 million, down from $11.0 million in Q1 2024, marking a 2% decline [9]. - The operating loss was $345,000, an improvement from a loss of $365,000 in the same quarter of the previous year [9]. - Net income for Q1 2025 was $122,000, or $0.01 per diluted share, compared to $188,000, or $0.02 per diluted share, in Q1 2024 [9]. - Active Members decreased by 2% to 30,180 as of March 31, 2025, compared to 30,870 at December 31, 2024, and down 5% from 31,620 at March 31, 2024 [9]. Cash Flow and Dividends - Cash flows from operations were $484,000 in Q1 2025, down from $549,000 in Q1 2024 [10]. - The company declared a quarterly cash dividend of $0.20 per share, payable on May 23, 2025 [10]. Balance Sheet Overview - Total cash, cash equivalents, and marketable securities were $41.9 million at March 31, 2025, down from $43.9 million at December 31, 2024 [10]. - Total assets decreased to $53.2 million as of March 31, 2025, from $55.4 million at December 31, 2024 [15][16]. Management Commentary - Management acknowledged the challenges posed by the ongoing trade war and emphasized efforts to align manufacturing closer to key markets to enhance efficiency [5]. - The company remains committed to delivering high-quality products and exceptional service to improve the well-being of its members [5].

CONTACT: Scott Davidson Senior Vice President and Chief Financial Officer Natural Health Trends Corp. Tel (U.S.): 310-541-0888 investor.relations@nhtglobal.com About Natural Health Trends Corp. Natural Health Trends Corp. (NASDAQ: NHTC) is an international direct-selling and e-commerce company operating through its subsidiaries throughout Asia, the Americas, and Europe. The Company markets premium quality personal care products under the NHT Global brand. Additional information can be found on the Company's ...

Membership Trends - Total active members decreased from 32,410 in 2023 to 30,870 in 2024, representing a decline of approximately 4.8%[30] - The Americas region saw a reduction in active members from 4,040 in 2023 to 3,360 in 2024, a decrease of about 16.8%[30] - Hong Kong's active members slightly decreased from 23,490 in 2023 to 23,150 in 2024, a decline of approximately 1.4%[30] - The company experienced a 5% decrease in active members at the end of 2024 compared to the end of 2023, and a 16% decrease in active members at the end of 2023 and 2022 compared to the previous year, significantly impacting year-over-year sales[100] Revenue and Financial Performance - Total net sales for 2024 were $42,963,000, a decrease of 2.2% from $43,924,000 in 2023[236] - Gross profit for 2024 was $31,785,000, down from $32,749,000 in 2023, reflecting a decline of 2.9%[236] - Operating expenses decreased to $33,084,000 in 2024 from $34,420,000 in 2023, a reduction of 3.9%[236] - The company reported a net income of $572,000 for 2024, slightly up from $568,000 in 2023[236] - Basic and diluted net income per common share remained at $0.05 for both 2024 and 2023[236] - Total assets decreased to $55,359,000 in 2024 from $69,091,000 in 2023, a decline of 20%[234] - Current liabilities increased to $20,799,000 in 2024 from $19,984,000 in 2023, an increase of 4.1%[234] - Stockholders' equity decreased to $32,872,000 in 2024 from $41,600,000 in 2023, a decline of 21.1%[234] - The company experienced a loss from operations of $1,299,000 in 2024, an improvement from a loss of $1,671,000 in 2023[236] - Comprehensive income for 2024 was $340,000, down from $503,000 in 2023, a decrease of 32.3%[239] - Total cash, cash equivalents, and restricted cash decreased to $13,567,000 at the end of 2024 from $56,217,000 at the end of 2023, representing a decline of 75.8%[244] - Operating activities resulted in a net cash outflow of $3,367,000 in 2024, an improvement compared to the outflow of $4,278,000 in 2023[244] - The company declared dividends of $0.80 per share, totaling $9,213,000 for 2024, consistent with the $9,215,000 declared in 2023[244] - The company reported a depreciation and amortization expense of $131,000 in 2024, down from $164,000 in 2023, indicating a reduction of 20.1%[244] - Inventories increased by $1,000,000 in 2024 compared to an increase of $228,000 in 2023, showing a significant rise in inventory levels[244] - The company purchased marketable securities worth $70,431,000 in 2024, compared to no purchases in 2023[244] - The net cash used in investing activities was $30,075,000 in 2024, a substantial increase from $46,000 in 2023[244] - The company experienced a net decrease in cash and cash equivalents of $42,650,000 in 2024, compared to a decrease of $13,529,000 in 2023[244] - The company holds $3.6 million in cash in bank accounts located in China, subject to foreign currency controls, with no losses reported[252] - The Company recognized a foreign exchange loss of $230,000 in 2024 and $292,000 in 2023[261] Compensation and Member Engagement - The company employs a binary compensation plan with unilevel features, allowing members to earn commissions based on the bonus volume points from product purchases by their down-line network[45] - Members can earn income through commissions on accumulated bonus volume from product purchases and retail profits from reselling products[47] - Compensation paid to members represented approximately 41% of net sales in 2024 and 42% in 2023, indicating a substantial expense that could reduce profitability[105] - The company offers various support programs, including product training meetings and member events, to enhance member engagement and loyalty[49] - The company has a comprehensive training system for members, covering various roles from prospects to sales leaders[25] - Modifications to the compensation plan are made to motivate members, potentially impacting commissions[264] - Performance-based agreements for business or market development may result in additional compensation for specific members[264] Regulatory and Compliance Challenges - The regulatory environment in China imposes restrictions on multi-level compensation and member recruitment activities, impacting the company's operations[55] - The company is subject to extensive governmental regulations regarding product claims and marketing, particularly for dietary supplements[66] - The company has committed to maintaining compliance with FDA regulations, including good manufacturing practices for dietary supplements[63] - The company anticipates reapplying for a direct selling license in China when conditions are favorable[57] - The company is subject to scrutiny from regulatory authorities regarding compliance with local laws, which could impact operations[68] - The company faces significant regulatory and legal barriers in international markets, which could impede growth and profitability in those regions[94][95] - The company is subject to extensive laws and regulations regarding direct selling, which could lead to significant penalties if compliance is not met[124] - The evolving regulatory climate in China and Hong Kong regarding privacy and data protection could materially adversely affect the company's business[127] - The company faces risks from geopolitical tensions between the U.S. and China, which could disrupt operations and adversely affect financial results[120] - The company has incurred significant expenses to comply with privacy and data protection laws, and any failure to comply could damage its reputation and financial condition[130] - The company may face challenges from third parties regarding the legality of its business operations, which could result in fines or adverse publicity[131] - Non-compliance with regulations could lead to significant penalties, affecting business operations and revenue[146] - New regulations on dietary supplements could impose additional restrictions, potentially harming the company's ability to introduce new products[148] Operational and Market Risks - The company relies on a limited number of independent third-party manufacturers, which poses risks related to product quality and timely delivery, potentially leading to significant revenue loss[93] - The company has suspended member activities in China due to a government campaign targeting illegal practices in the direct selling industry, which may have a material adverse effect on business operations[115] - Economic challenges in China and Hong Kong could have a material adverse impact on the company's overall business and financial results[79] - The company must navigate risks related to product warranties and returns, which vary by country and can affect customer satisfaction and retention[69] - Adverse publicity regarding product claims and compliance could negatively impact the company's ability to attract and retain members, affecting revenue generation[82] - The direct selling industry is highly competitive, with significant competition for member recruitment from larger organizations and local competitors[90] - The company has faced challenges in maintaining member engagement and productivity, particularly if new products fail to gain market acceptance[92] - Cybersecurity risks and data breaches could disrupt operations and harm the company's reputation, leading to financial liabilities[162] International Operations and Currency Risks - The company operates in multiple international markets, including the Americas, Greater China, Southeast Asia, South Korea, Japan, India, and Europe, with a focus on direct-selling and e-commerce[15] - In 2024, 96% of the company's revenue was recorded by subsidiaries located outside of North America, exposing it to foreign currency exchange rate fluctuations[134] - The company's foreign currency exchange rate exposure to various currencies collectively represented approximately 16% and 18% of revenue in 2024 and 2023, respectively[135] - Changes in U.S. tax law and proposals to reform foreign tax laws could significantly affect the company's tax position and cash flows[138] - Operations are subject to customs duties regulations, and failure to comply could materially impact financial condition[142] - Transfer pricing regulations require compliance, and non-compliance may lead to significant adverse effects on financial results[143] - Extensive government regulations on product formulation and marketing could delay or limit product sales, impacting revenue[144] - Compliance with international regulations may create delays and added expenses in introducing new products to certain markets[145]

Core Insights - Natural Health Trends Corp. (NHTC) reported a decline in stock price of 1.1% post-earnings announcement, contrasting with a 0.4% gain in the S&P 500 Index during the same period [1] - The company experienced a revenue of $10.8 million for Q4 2024, nearly flat compared to $10.9 million in Q4 2023, with a notable 7% year-over-year increase in Greater China sales [2] - For the full year, revenue decreased by 2.2% to $42.9 million from $43.9 million in 2023, while net income remained consistent at $572,000 [3] Financial Performance - The operating loss for Q4 2024 was $421,000, widening from a loss of $292,000 in the previous year [2] - Gross profit for the year was $31.8 million, with a gross margin of 73.9%, down from 74.6% in 2023 due to increased freight costs [3] - Commissions expense as a percentage of sales increased to 41.9% in Q4 2024 from 41.6% in the prior-year quarter [4] Market Dynamics - The gross margin for Q4 2024 was 74.2%, slightly lower than 74.5% in the prior-year quarter, primarily due to higher freight costs [5] - Sales growth in Greater China was attributed to effective promotions and incentives, while North America and Taiwan faced challenges due to strategic pricing adjustments [6] Cash Flow and Liquidity - Net cash provided by operating activities was $88,000 in Q4 2024, compared to a net cash usage of $69,000 in the prior-year period [7] - Cash, cash equivalents, and marketable securities totaled $43.9 million as of Dec. 31, 2024, down from $46.3 million as of Sept. 30, 2024 [7] Product Development and Expansion - The company launched two new products in Hong Kong during Q4 2024, with plans for further market expansion [8] - NHTC opened operations in Colombia in 2024 and plans to relocate its headquarters to Rolling Hills Estates, CA, in February 2025 [9]

Financial Data and Key Metrics Changes - Total fourth quarter revenue was $10.8 million, roughly unchanged from $10.9 million in the fourth quarter a year ago [14] - Gross profit margin for the fourth quarter was 74.2%, slightly down from 74.5% in the prior year due to higher freight costs [15] - Net income for the fourth quarter was $176,000 or $0.02 per diluted share, compared to $358,000 or $0.03 per diluted share in the fourth quarter of 2023 [16] Business Line Data and Key Metrics Changes - Revenue in the primary market of Greater China increased by 7% compared to the fourth quarter of 2023, while performance in Taiwan and North America negatively impacted overall results [6][14] - The active member base was 30,870 at December 31, consistent with September 30, but a 5% decline since the end of December 2023 [15] Market Data and Key Metrics Changes - The Greater China market showed a 9% increase in net sales compared to the preceding third quarter of 2024, indicating a positive trend despite sluggish consumer sentiment [6] Company Strategy and Development Direction - The company introduced two new products in Hong Kong and rolled them out in Taiwan and North America, aiming to enhance market presence and consumer engagement [7][8] - The opening of the Colombia market for in-country order taking reflects the company's strategy to expand its global footprint [9] Management's Comments on Operating Environment and Future Outlook - Management acknowledged the challenges posed by consumer sentiment and macroeconomic conditions in Greater China but expressed confidence in the company's direction and the commitment of its leaders and members [19][20] - The company remains focused on innovating and enhancing support for its members to ensure continued success [20] Other Important Information - The company paid out $9.2 million in dividends for the full year of 2024 and declared a quarterly cash dividend of $0.20 per share [18][19] Q&A Session Summary - No specific questions or answers were provided in the content regarding the Q&A session.

Financial Data and Key Metrics Changes - Total fourth quarter revenue was $10.8 million, roughly unchanged from $10.9 million in the same quarter last year [11] - Gross profit margin for the fourth quarter was 74.2%, slightly down from 74.5% year-over-year, primarily due to higher freight costs [12] - Net income for the fourth quarter was $176,000 or $0.02 per diluted share, compared to $358,000 or $0.03 per diluted share in the fourth quarter of 2023 [13] Business Line Data and Key Metrics Changes - Revenue in the primary market of Greater China increased by 7% compared to the fourth quarter of 2023, while performance in Taiwan and North America negatively impacted overall results [5][11] - Active member base remained at 30,870 as of December 31, consistent with September 30, but showed a 5% decline since December 2023 [11] Market Data and Key Metrics Changes - The Greater China market showed a 9% increase in net sales compared to the preceding third quarter of 2024, indicating a positive trend despite sluggish consumer sentiment [5] - The company introduced new products in Hong Kong and conducted a six-city roadshow in China to promote these products [6] Company Strategy and Development Direction - The company is focusing on safeguarding margins and reinforcing market discipline through strategic price adjustments and reduced product promotions [5] - New product launches and training initiatives are aimed at empowering members and enhancing recruitment and retention [8][9] Management's Comments on Operating Environment and Future Outlook - Management acknowledged the challenging consumer sentiment and macroeconomic conditions in Greater China but expressed confidence in the company's direction and the commitment of key leaders and members [15] - The company remains committed to innovating and enhancing support for its members to ensure continued success [15] Other Important Information - The company paid out $9.2 million in dividends for the full year 2024, emphasizing the priority of returning capital to stockholders [14] - A quarterly cash dividend of $0.2 per share was declared, payable on February 28 to stockholders of record as of February 18 [15] Q&A Session Summary - No specific questions or answers were provided in the content regarding the Q&A session.

Financial Performance - Fourth quarter net sales were $10.8 million, roughly unchanged from $10.9 million in Q4 2023, with a 9% sequential increase from the Hong Kong business and a 7% year-over-year increase[4]. - Full year net sales decreased by 2% to $43.0 million compared to $43.9 million in 2023[4]. - Net income for Q4 2024 was $176,000, or $0.02 per diluted share, down from $358,000, or $0.03 per diluted share, in Q4 2023[4]. - Net income for 2024 increased to $572 million from $568 million in 2023, reflecting a slight growth[16]. Membership and Operations - Active Members totaled 30,870 as of December 31, 2024, a decrease of 5% from 32,410 at the end of 2023[4]. - Operating loss for Q4 2024 was $421,000, compared to a loss of $292,000 in Q4 2023[4]. Cash Flow and Liquidity - Total cash, cash equivalents, and marketable securities were $43.9 million as of December 31, 2024, down from $46.3 million as of September 30, 2024[9]. - Net cash provided by operating activities was $88,000 in Q4 2024, compared to net cash used of $69,000 in Q4 2023[9]. - Net cash used in operating activities improved to $(3,367) million in 2024 compared to $(4,278) million in 2023[16]. - Cash, cash equivalents, and restricted cash at the end of the period decreased to $13,567 million from $56,217 million[16]. - The net decrease in cash, cash equivalents, and restricted cash was $(42,650) million in 2024, compared to $(13,529) million in 2023, highlighting a significant cash outflow[16]. Investments and Assets - Net cash used in investing activities rose significantly to $(30,075) million in 2024 from $(46) million in 2023, primarily due to purchases of marketable securities[16]. - Right-of-use assets obtained in exchange for operating lease liabilities amounted to $124 million in 2024, down from $147 million in 2023[16]. - Deferred revenue decreased to $245 million in 2024 from $565 million in 2023, indicating a decline in future revenue recognition[16]. Dividends and Corporate Actions - The company declared a quarterly cash dividend of $0.20 per share, payable on February 28, 2025[9]. - Dividends paid remained stable at $(9,213) million in both 2024 and 2023[16]. - The company relocated its corporate headquarters from Hong Kong back to Rolling Hills Estates, California in February 2025[4]. - The company expects to issue its 2024 audited financial results in late February 2025[6].

Core Insights - Natural Health Trends Corp. reported a steady performance in the fourth quarter of 2024, with net sales from its Hong Kong business increasing by 9% sequentially and 7% year-over-year, despite challenging consumer sentiment in other markets [4][7] - The company declared a quarterly cash dividend of $0.20 per share, payable on February 28, 2025 [9] - The company relocated its corporate headquarters from Hong Kong back to Rolling Hills Estates, California in February 2025 [5] Fourth Quarter 2024 Financial Highlights - Revenue for the fourth quarter was $10.8 million, roughly unchanged from $10.9 million in the same quarter of 2023 [7] - Operating loss was $421,000, compared to a loss of $292,000 in the fourth quarter of 2023 [7] - Net income was $176,000, or $0.02 per diluted share, down from $358,000, or $0.03 per diluted share, in the fourth quarter of 2023 [7] Full Year 2024 Financial Highlights - Total revenue for the year was $43.0 million, a decrease of 2% compared to $43.9 million in 2023 [7] - Operating loss for the year was $1.3 million, an improvement from a loss of $1.7 million in 2023 [7] - Net income for the year was $572,000, or $0.05 per diluted share, compared to $568,000, or $0.05 per diluted share, in 2023 [7] Cash Flow and Balance Sheet - Net cash provided by operating activities was $88,000 in the fourth quarter of 2024, compared to net cash used of $69,000 in the fourth quarter of 2023 [8] - Total cash, cash equivalents, and marketable securities were $43.9 million as of December 31, 2024, down from $46.3 million as of September 30, 2024 [8] - The company has paid $15.1 million of the total $20.2 million liability arising from the 2017 U.S. Tax Cuts and Jobs Act [8]

Core Insights - Natural Health Trends Corp. reported steady performance in the fourth quarter of 2024, with net sales from its Hong Kong business increasing by 9% sequentially and 7% year-over-year despite challenging consumer sentiment [4][7] - The company declared a quarterly cash dividend of $0.20 per share, payable on February 28, 2025 [9] - The company relocated its corporate headquarters from Hong Kong back to Rolling Hills Estates, California in February 2025 [5] Fourth Quarter 2024 Financial Highlights - Revenue for the fourth quarter was $10.8 million, roughly unchanged from $10.9 million in the same quarter of 2023 [7] - Operating loss was $421,000, compared to a loss of $292,000 in the fourth quarter of 2023 [7] - Net income was $176,000, or $0.02 per diluted share, down from $358,000, or $0.03 per diluted share in the fourth quarter of 2023 [7][18] Full Year 2024 Financial Highlights - Total revenue for the full year was $43.0 million, a decrease of 2% compared to $43.9 million in 2023 [7] - Operating loss for the full year was $1.3 million, an improvement from a loss of $1.7 million in 2023 [7] - Net income for the full year was $572,000, or $0.05 per diluted share, compared to $568,000, or $0.05 per diluted share in 2023 [7][18] Cash Flow and Balance Sheet - Net cash provided by operating activities was $88,000 in the fourth quarter of 2024, compared to net cash used of $69,000 in the fourth quarter of 2023 [8] - Total cash, cash equivalents, and marketable securities were $43.9 million as of December 31, 2024, down from $46.3 million as of September 30, 2024 [8] - The company has paid $15.1 million of the total $20.2 million liability arising from the 2017 U.S. Tax Cuts and Jobs Act [8]