Nu Skin Enterprises, Inc. (NYSE:NUS) Q3 2021 Earnings Conference Call November 3, 2021 5:00 PM ET Company Participants Scott Pond - VP, IR Ryan Napierski - President and CEO Connie Tang - Chief Global Growth and Customer Experience Officer Mark Lawrence - EVP and CFO Conference Call Participants Steph Wissink - Jefferies Doug Lane - Lane Research Chris Armes - Stifel Operator Good day and thank you for standing by. Welcome to the Third Quarter 2021 Nu Skin Enterprises Earnings Conference Call. At this time, ...

Nu Skin Enterprises, Inc. (NYSE:NUS) Q2 2021 Earnings Conference Call August 4, 2021 5:00 PM ET Company Participants Scott Pond - Vice President, Investor Relations Ritch Wood - Chief Executive Officer Ryan Napierski - President and CEO-elect Mark Lawrence - Chief Financial Officer Conference Call Participants Doug Lane - Lane Research Chris Armes - Stifel Steph Wissink - Jefferies Faiza Alwy - Deutsche Bank Operator Good day and thank you for standing by. Welcome to the Q2 2021 Nu Skin Enterprises Earnings ...

[Part I. Financial Information](index=3&type=section&id=Part%20I.%20Financial%20Information) [Financial Statements (Unaudited)](index=3&type=section&id=Item%201.%20Financial%20Statements%20(Unaudited)) Presents unaudited consolidated financial statements as of June 30, 2021, showing growth in revenue, net income, and changes in financial position [Consolidated Balance Sheets](index=3&type=section&id=Consolidated%20Balance%20Sheets) Total assets increased to $2.05 billion, driven by inventories, while liabilities and equity also grew Consolidated Balance Sheet Highlights (in thousands) | Account | June 30, 2021 | December 31, 2020 | | :--- | :--- | :--- | | **Total Assets** | **$2,049,980** | **$1,957,076** | | Cash and cash equivalents | $354,759 | $402,683 | | Inventories, net | $390,977 | $314,366 | | **Total Liabilities** | **$1,132,154** | **$1,062,805** | | Current portion of long-term debt | $152,500 | $30,000 | | **Total Stockholders' Equity** | **$917,826** | **$894,271** | [Consolidated Statements of Income](index=4&type=section&id=Consolidated%20Statements%20of%20Income) Q2 2021 revenue increased 15% to $704.1 million, with net income up 41.8% to $59.3 million Q2 & H1 2021 vs 2020 Performance (in thousands, except per share) | Metric | Q2 2021 | Q2 2020 | % Change | H1 2021 | H1 2020 | % Change | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | **Revenue** | **$704,055** | **$612,366** | **+15.0%** | **$1,381,081** | **$1,130,394** | **+22.2%** | | **Operating Income** | $85,376 | $58,074 | +47.0% | $148,289 | $94,639 | +56.7% | | **Net Income** | $59,338 | $41,851 | +41.8% | $106,768 | $61,581 | +73.4% | | **Diluted EPS** | $1.15 | $0.81 | +42.0% | $2.06 | $1.15 | +79.1% | [Consolidated Statements of Cash Flows](index=8&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows) Operating cash flow sharply decreased to $1.9 million due to increased inventories and decreased accrued expenses Six Months Ended June 30 Cash Flow Summary (in thousands) | Activity | 2021 | 2020 | | :--- | :--- | :--- | | Net cash provided by operating activities | $1,859 | $166,081 | | Net cash used in investing activities | ($55,235) | ($28,489) | | Net cash provided by/(used in) financing activities | $11,233 | ($92,533) | | **Net (decrease) increase in cash** | **($47,924)** | **$39,882** | - The significant decrease in operating cash flow was largely driven by an **$80.2 million** increase in inventories and a **$55.4 million** decrease in accrued expenses[29](index=29&type=chunk) [Notes to Consolidated Financial Statements](index=9&type=section&id=Notes%20to%20Consolidated%20Financial%20Statements) Details accounting policies, segment performance, debt, capital stock, and the MyFavoriteThings acquisition - The company reports revenue across ten segments: seven geographic Nu Skin segments and three Rhyz Investments segments (Manufacturing, Grow Tech, Rhyz other)[31](index=31&type=chunk)[76](index=76&type=chunk) - As of June 30, 2021, the company had **$322.5 million** outstanding on its term loan and **$120.0 million** on its revolving credit facility[43](index=43&type=chunk) - During the first six months of 2021, the company repurchased **1.2 million shares** for **$60.4 million** $265.4 million remained available for repurchases as of June 30, 2021[52](index=52&type=chunk) - In April 2021, the company acquired MyFavoriteThings, Inc. for **$16.8 million** in cash, with potential for an additional **$24.0 million** in contingent consideration This resulted in **$12.6 million** of goodwill[89](index=89&type=chunk) [Management's Discussion and Analysis (MD&A)](index=20&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Q2 revenue grew 15% due to digital-first strategy, with EPS up 42%, despite decreased operating cash flow - Q2 2021 revenue increased **15%** to **$704.1 million**, benefiting from a **6%** positive impact from foreign currency fluctuations Sales Leaders grew **15%** while Customers decreased **2%** year-over-year[93](index=93&type=chunk) - The business continues to benefit from a strategic shift to digital and social commerce, which has been more broadly adopted in the Americas/Pacific and EMEA segments, driving their growth[94](index=94&type=chunk) - The company is continuing the launch of ageLOC Boost and is preparing for the launch of Beauty Focus Collagen+ and ageLOC Meta in the second half of 2021 and into 2022[94](index=94&type=chunk) - Cash from operations for H1 2021 was only **$1.9 million**, down from **$166.1 million** in H1 2020, primarily due to an **$80.2 million** increase in inventory and higher commission/incentive payouts[123](index=123&type=chunk) [Segment Results](index=21&type=section&id=Segment%20Results) EMEA led Q2 revenue growth at 64%, with Americas/Pacific also strong, while other regions varied Q2 2021 Revenue Growth by Segment (vs Q2 2020) | Segment | Revenue (USD M) | % Change | Constant Currency % Change | | :--- | :--- | :--- | :--- | | EMEA | $83.1 | +64% | +49% | | Americas/Pacific | $151.7 | +19% | +14% | | South Korea | $88.6 | +15% | +6% | | Southeast Asia | $70.8 | +6% | +2% | | Mainland China | $154.2 | +5% | -4% | | Hong Kong/Taiwan | $38.5 | +4% | 0% | | Japan | $68.0 | 0% | +1% | - The EMEA segment's growth was boosted by the ageLOC Boost launch, which generated **$11.1 million** in sales during the quarter[109](index=109&type=chunk) - The Americas/Pacific segment's performance was negatively impacted by economic instability in Argentina, which saw a **73%** revenue decline in Q2[105](index=105&type=chunk) [Liquidity and Capital Resources](index=25&type=section&id=Liquidity%20and%20Capital%20Resources) Cash and working capital decreased, with significant cash use for operations, capex, and repurchases - Projected capital expenditures for 2021 are estimated at **$80-95 million**, including **$25-30 million** for a new manufacturing plant in Mainland China[124](index=124&type=chunk) - The company plans to refinance its Credit Agreement, which includes a term loan and revolving credit facility, within the next twelve months[124](index=124&type=chunk) - As of June 30, 2021, the company held **$321.2 million** of its cash outside the U.S The company plans to repatriate most non-U.S. earnings, except for **$60.0 million** designated as indefinitely reinvested in Mainland China[128](index=128&type=chunk)[129](index=129&type=chunk) [Quantitative and Qualitative Disclosures about Market Risk](index=28&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20about%20Market%20Risk) Primary market risk is foreign currency fluctuations, managed with swaps, impacting revenue and earnings - A majority of revenue is generated outside the U.S., making reported results sensitive to U.S. dollar exchange rate fluctuations[140](index=140&type=chunk) - The company uses interest rate swaps to hedge against interest rate movements on its variable-rate debt and may use foreign currency exchange contracts to reduce exposure to currency fluctuations[71](index=71&type=chunk)[142](index=142&type=chunk) - Highly inflationary accounting is used for the Argentina subsidiary, with the U.S. dollar as the functional currency[141](index=141&type=chunk) [Controls and Procedures](index=28&type=section&id=Item%204.%20Controls%20and%20Procedures) Disclosure controls and procedures were effective, with no material changes to internal controls - Management, including the CEO and CFO, concluded that disclosure controls and procedures were effective as of June 30, 2021[143](index=143&type=chunk) - No material changes were made to the internal control over financial reporting during the second quarter of 2021[144](index=144&type=chunk) [Part II. Other Information](index=29&type=section&id=Part%20II.%20Other%20Information) [Legal Proceedings](index=29&type=section&id=Item%201.%20Legal%20Proceedings) No material developments in legal proceedings, with no expected adverse financial impact - No material developments have occurred concerning legal proceedings discussed in the 2020 Annual Report on Form 10-K[146](index=146&type=chunk) [Risk Factors](index=29&type=section&id=Item%201A.%20Risk%20Factors) Supplements risk factors including direct selling regulations, COVID-19, economic conditions, and ESG matters - The U.S. Federal Trade Commission (FTC) is reviewing its Business Opportunity Rule If the exemption for multi-level marketing companies is removed, it could negatively impact the business[149](index=149&type=chunk) - The COVID-19 pandemic and its variants continue to pose risks by interrupting supply chains, impacting sales force activities, and potentially affecting the company's ability to comply with debt covenants[151](index=151&type=chunk)[152](index=152&type=chunk) - Difficult economic conditions, including potential inflation, could reduce consumer demand for the company's products[154](index=154&type=chunk) - Increased stakeholder focus on corporate citizenship and sustainability (ESG) matters presents a risk if the company fails to meet expectations or achieve its stated goals[155](index=155&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=31&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) Repurchased 184,723 shares at $54.16 average price in Q2 2021, with $265.4 million remaining Issuer Purchases of Equity Securities (Q2 2021) | Period | Total Shares Purchased | Average Price Paid per Share | Approx. Dollar Value Remaining (in millions) | | :--- | :--- | :--- | :--- | | April 1 - 30, 2021 | 115,209 | $52.44 | $269.4 | | May 1 - 31, 2021 | 66,299 | $56.83 | $265.6 | | June 1 - 30, 2021 | 3,215 | $60.45 | $265.4 | | **Total** | **184,723** | **$54.16** | **$265.4** | [Other Information](index=31&type=section&id=Item%205.%20Other%20Information) CFO Mark H. Lawrence's compensation adjusted, with salary increased to $575,000 and higher equity award - CFO Mark H. Lawrence's salary was increased to **$575,000**, and his 2022 annual equity award is anticipated to be approximately **$1,300,000**[160](index=160&type=chunk)

Nu Skin Enterprises, Inc. (NYSE:NUS) Q1 2021 Earnings Conference Call May 5, 2021 5:00 PM ET Company Participants Scott Pond - Vice President, Investor Relations Ritch Wood - Chief Executive Officer Ryan Napierski - President and CEO-elect Mark Lawrence - Chief Financial Officer Conference Call Participants Faiza Alwy - Deutsche Bank Doug Lane - Lane Research Steph Wissink - Jefferies Mark Astrachan - Stifel Operator Good day and thank you for standing by. Welcome to the Q1 2021 Nu Skin Enterprises Earnings ...

Q1 2021 Performance - Revenue increased by 31% year-over-year, with a 5.7% positive impact from foreign exchange[5] - Earnings per share (EPS) increased by 153% year-over-year to $0.91[5] - The number of sales leaders increased by 22% year-over-year[5] - The number of customers increased by 34% year-over-year[5] Customer and Sales Leader Metrics - Total customers reached 1,517,260 in Q1 2021[7] - Total sales leaders reached 60,619 in Q1 2021[7] - EMEA region saw a 111% increase in customers and an 88% increase in sales leaders[7] - Americas/Pacific region saw a 90% increase in customers and a 78% increase in sales leaders[7] Operational Performance - Gross margin was 74.8% in Q1 2021[12] - Selling expenses were 40.4% of revenue in Q1 2021[12] - General & Administrative (G&A) expenses were 25.1% of revenue in Q1 2021[12] - Operating margin was 9.3% in Q1 2021[12] 2021 Projections - The company projects 2021 EPS to be between $4.05 and $4.30, representing a 12% to 18% increase[17] - The company projects Q2 2021 revenue to be between $680 million and $705 million, representing an 11% to 15% increase, with approximately a 5% positive foreign exchange impact[17] - The company projects Q2 2021 EPS to be between $0.97 and $1.07, representing a 20% to 32% increase[17] - The company projects 2021 revenue to be between $2.80 billion and $2.87 billion, representing a 9% to 11% increase, with approximately a 3% to 4% positive foreign exchange impact[17]

Nu Skin Enterprises, Inc. 2021 Investor Day Summary Company Overview - **Company**: Nu Skin Enterprises, Inc. (NYSE: NUS) - **Event**: 2021 Investor Day held on February 11, 2021 Key Points and Arguments Business Resilience and Response to COVID-19 - Nu Skin faced unprecedented challenges due to the COVID-19 pandemic but demonstrated resilience and adaptability in maintaining business operations and supporting employees and sales leaders [6][11] - The management team expressed gratitude for the dedication and efforts of global employees and sales leaders during the pandemic [6][12] Leadership Transition - Ritch Wood, the current CEO, will transition the CEO role to Ryan Napierski on September 1, 2021, after 30 years with the company [8][12] - Ryan Napierski has over 25 years of experience with Nu Skin and has been prepared for this leadership role [9][12] Growth Strategy - The company aims to expand its growth strategy through innovative products, digital platforms, and a balanced geographic profile [7][21] - Nu Skin reported a 60% increase in active customer base from 980,000 in Q1 2017 to 1,560,000 in Q4 2020 [15] - The average age of customers has decreased by 5 years, attracting a younger demographic [16] Financial Performance - In Q4 2020, Nu Skin achieved its largest quarterly revenue in 7 years, with earnings per share (EPS) of $1.40, representing a 94% growth [18] - For the full year 2020, revenue grew by 7% and EPS grew by 17%, despite the pandemic [20] - The company anticipates revenue growth of 5% to 9% for 2021, equating to approximately $200 million [22] Product Innovation and Sustainability - Nu Skin introduced new products, including the ageLOC Boost device, which generated approximately $100 million in revenue in the second half of 2020 [19][41] - The company is committed to sustainability, with goals to ensure all packaging is recycled, recyclable, reusable, reduced, or renewable by 2030 [27] - Nu Skin secured 9 sustainability awards in 2020 for its waste and packaging reductions [29] Digital Transformation and Social Commerce - The company is transitioning to a digital-first affiliate marketing model, leveraging social commerce to connect with consumers [52][56] - Over 90% of revenue transactions now occur online, with approximately half coming from personal product subscriptions and loyalty programs [38] - The introduction of Vera, an AI-powered personal product recommendation tool, aims to enhance customer engagement and personalization [64] Geographic Performance - The West region, including North America and Latin America, reported record revenue growth of 53% year-over-year [67] - Mainland China showed a return to growth in Q4 2020, with active customers up 30% year-over-year [68] - Southeast Asia is beginning to adopt social commerce, with encouraging potential in markets like Indonesia and the Philippines [69] Additional Important Content - Nu Skin's commitment to corporate social responsibility (CSR) includes various initiatives, such as providing meals to children and supporting local charities [25][26] - The company emphasizes the importance of diversity, equity, and inclusion (DEI) in its workplace and community efforts [26] - Nu Skin's Empower Me strategy focuses on personalized beauty and wellness solutions, leveraging technology to enhance customer experiences [45][64] This summary encapsulates the key insights and strategic directions discussed during the Nu Skin 2021 Investor Day, highlighting the company's resilience, growth strategies, and commitment to innovation and sustainability.