Nu Skin China revenues Q4 fall by more than half

By Simon Pitman

- Last updated on GMT

Nu Skin China revenues Q4 fall by more than half

Related tags New anti-ageing lines Revenue

Nu Skin is continuing to feel the fall-out from its China sales ban earlier in the year, while fourth quarter results are further impacted by the trial offer launch for its TR90 in the same period for 2013.

The company reported that fourth quarter sales were down from $1.06bn in the final quarter of 2013, to reach $609.6m in the fourth quarter of 2014, a fall of 42%.

The company’s share price, listed one the New York Stock Exchange, fell by more than 2% in pre-market trading following the announcement.

This result was also negatively impacted by currency translation, which executives said impacted the result by approximately 4%.

Full-year picture looks better

For the full year 2014 sales the overall picture was not so bad, reflecting the absence of the TR90 promotional campaign, with 2014 sales down 19% to $2.57bn, compared to 2013.

The company said that the main impact of the fall in sales was down to the promotional offer for its newly launched TR90 weight management system in the fourth quarter of 2013, but the results also underlined a sluggish performance in its biggest market, China.

For the fourth quarter sales in China were down 56% to $213m compared to $482m in the corresponding period last year. In North Asia, the company’s second biggest region, sales were down by 35% during the quarter, to $186m.

Three-pronged hit on results

Commenting on the results, Nu Skin CEO Truman Hunt said the results had been impacted by the three-prong hit of negative currency translations, the promotion activity on the TR90 in the fourth quarter of 2013 and the continued effect on the business following the ban on sales in China earlier on in 2014.

“Despite the 2014 revenue decline, our three-year compounded annual revenue growth rate was 14 per cent, reflecting longer-term business improvement,"​ Truman said.

Will new anti-ageing lines save the day?

Looking ahead, Truman said he believes that new anti-ageing products in the nutrition and skin care categories during the second half of 2015 are likely to boost full year results significantly.

“On the nutrition front, we plan to introduce ageLOC Youth, our most advanced anti-ageing supplement. We also plan to introduce ageLOC Me, an innovative anti-ageing skin care system that enables consumers to personalize a daily regimen based on individual preferences and skin care need,”​ said Truman.

“In the Americas and Greater China we plan to launch our new essential oil lines. Early sales leader enthusiasm, encouraging consumer testing, and the size of each of these product categories lead us to believe these products will be important business drivers."

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