Natural Health Stock Declines Following Lower Q4 Earnings

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]