March 02, 2011
Financial News, March 2011
Pre-Paid Legal Agrees to Buy-out
Pre-Paid Legal Services Inc. (PPD-NYSE), which offers legal services for a monthly fee, agreed to sell itself to private equity firm MidOcean Partners for $650 million in cash. The offer price of $66.50 a share represents a 9 percent premium to Pre-Paid’s Friday, Jan. 28, close of $60.26.
The company said its board has unanimously approved the agreement with MidOcean and that the transaction is expected to close on July 31.
Pre-Paid had said in October 2010 that it was evaluating a $592 million buyout offer from an unnamed private equity firm.
Pre-Paid Legal Services Inc. offers legal service benefits plans provided through a network of more than 50 independent law firms across the United States and Canada.
Amway Parent Grows to $9.2 Billion in 2010
Strong growth across global markets as direct seller gains market share; brand-building momentum drives 10th sales increase in 11 years
Amway’s parent company, Alticor Inc., reported sales exceeding $9.2 billion for the year ended Dec. 31, 2010, a 9.5 percent increase over sales of $8.4 billion in 2009. Amway is the world’s second-largest direct selling enterprise and has more than 3 million distributors, and despite an economy recovering from a global recession, 2010 was very solid. The 2010 performance results mark Alticor’s 10th sales increase in the last 11 years. Amway said growth was fueled by strong 2010 results in China, the company’s largest market, as well as healthy gains in India, Korea, North America and Latin America.
Amway is one of the world’s largest direct selling businesses. Founded in 1959 and headquartered in Ada, Mich., Amway offers consumer products and business opportunities in more than 80 countries and territories worldwide. In its most recent fiscal year, the Amway family of companies reported annual sales of $8.4 billion.
Avon Products Inc.
Avon Products Inc. (AVP-NYSE) reported fourth-quarter 2010 total revenue of $3.2 billion, 1 percent higher than that of fourth-quarter 2009. Fourth-quarter 2010 operating profit of $356 million was down 13 percent compared with the year-ago quarter, and operating margin was 11.2 percent, down 180 basis points year over year.
Fourth-quarter revenue in North America was up 1 percent, or flat in constant dollars. The acquisition of Silpada Designs Inc. had a favorable impact on fourth-quarter revenue of approximately 11 percentage points.
Full-year 2010 total revenue of $10.9 billion was 6 percent higher than that of 2009, and up 6 percent in constant dollars. Acquisitions contributed 1 percent to revenue growth during the year.
Avon raised its quarterly dividend to 23 cents per share from 22 cents. The dividend is payable on March 1 to shareholders. The increase boosts the annual payout to 92 cents from 88 cents per share.
Avon, the company for women, is a leading global beauty company, with over $10 billion in annual revenue. As the world’s largest direct seller, Avon markets to women in more than 100 countries through approximately 6.5 million independent Avon Sales Representatives.
Nu Skin Enterprises Inc.
Nu Skin Enterprises Inc. (NUS-NYSE) announced record fourth-quarter and annual results. Revenue for the quarter was $401.2 million, a 6 percent improvement over the prior year. Earnings per share for the quarter increased 23 percent to 58 cents, compared to 47 cents in the prior year.
The company also reported annual revenue of $1.54 billion, a 15 percent year-over-year improvement. Earnings per share for the year were $2.11, a 51 percent increase over 2009, or a 41 percent improvement when excluding restructuring charges in the prior year.
Fourth-quarter revenue in the Americas was $61.4 million, compared to $78.9 million for the prior year. A 23 percent revenue decline in the United States was primarily the result of approximately $17 million of convention sales related to the introduction of ageLOC Transformation at the company’s global convention in the fourth quarter of 2009.
For 2010, increased revenue and a higher level of profitability resulted in cash from operations improving to $205 million, compared to $134 million in the prior year. During the year, the company paid $31 million in dividends and repurchased approximately $60 million of its stock. The company ended the year with $230 million in cash and $161 million of debt.
Nu Skin’s quarterly cash dividend increased by 8 percent to 13.5 cents per share. Annually, this would increase the dividend to 54 cents from 50 cents in the prior year. Dividend payments during the quarter were $7.8 million and the company repurchased $9.5 million of its shares outstanding. The increase begins in the first quarter and will be paid on March 16.
Nu Skin Enterprises Inc. is a global direct selling company operating in 50 markets worldwide with a salesforce of more than 785,000. The company markets premium-quality personal-care products under the Nu Skin brand, science-based nutritional supplements under the Pharmanex brand and technology-based products and services under the Big Planet brand.
Tupperware Brands Corp.
Tupperware Brands Corp. (TUP-NYSE) reported fourth quarter 2010 sales and profit. Fourth quarter 2010 sales increased in local currency by 6 percent versus 2009. This resulted in record reported sales that were 5 percent above the fourth quarter of 2009. Additionally, total salesforce reached a record high of over 2.6 million.
Tupperware North America sales were up 9 percent in local currency (up 11 percent reported) versus prior year. Tupperware United States and Canada also had a 9 percent increase in the quarter. Fourth quarter pretax profit for the segment was down 1 percent in local currency (up 2 percent reported). The total salesforce size at the end of the year was up 9 percent.
Beauty North America sales were up 1 percent in local currency (up 5 percent reported). BeautiControl experienced a 9 percent decrease, which was a sequential improvement from the double-digit decreases earlier in 2010, and the business continued to work on improving salesforce activation. The segment’s pretax profit in the quarter increased 18 percent in local currency (up 26 percent reported), reflecting improved cost structures in both units. The total salesforce size at the end of the year was even with prior year.
Full-year company sales grew 6 percent in local currency (up 8 percent reported). The Tupperware brand segments grew 7 percent in local currency (up 10 percent reported). Beauty North America’s operating profit increased modestly compared with last year. Diluted earnings per share was $3.53, up 24 percent in local currency (up 28 percent reported).
Tupperware Brands Corp. is a global direct selling company with an independent salesforce of 2.5 million.
LifeVantage Corp. (LFVN.ob-OTC BB), the maker of science-based solutions to oxidative stress, announced unaudited second fiscal quarter 2011 financial and operating results.
LifeVantage recorded net revenue of approximately $7.5 million for the three-month period ended Dec. 31, 2010, which represents an increase of approximately $1.1 million, or 17 percent over net revenue of $6.4 million for the three-month period ended Sept. 30, 2010. This is also an approximate $5.0 million, or 204 percent increase, in net revenue over the $2.5 million net revenue reported for the same quarter last year.
The company is also reporting record operating income of approximately $609,000 in the second fiscal quarter 2011. This $609,000 operating income represents a $264,000, or an approximate 77 percent, increase over operating income of $345,000 for the first fiscal quarter 2011 and a $3.3 million increase over operating loss of $2.7 million for the same quarter last year.
Founded in 2003 and based in San Diego, Calif., LifeVantage Corp. is a publicly traded, science-based, nutraceutical company dedicated to helping people reach their health and wellness goals while creating business opportunities.
USANA Health Sciences Inc.
USANA Health Sciences Inc. (USNA-NASDAQ) announced financial results for its fiscal fourth quarter and full- year ended Jan. 1.
Net sales in the fourth quarter of 2010 increased by 17.8 percent to a record $137.5 million, compared with $116.8 million in the fourth quarter of the prior year. Sales from the newly acquired BabyCare operation in China added $4.1 million and favorable changes in currency exchange rates added $3.6 million in sales.
Net earnings in the fourth quarter increased by 21.4 percent to $12.4 million, or 75 cents per share, compared with 66 cents per share, in the fourth quarter of the prior year.
For the full-year ended Jan. 1, net sales increased by 18.5 percent to a record $517.6 million, compared with $436.9 million in the prior year.
Net earnings for the full-year 2010 increased by 36.0 percent to a record $45.7 million, or $2.86 per share, compared with $2.17 per share in the prior year.
During the fourth quarter of 2010, net sales in the North America region decreased by 2.0 percent to $59.6 million, compared with the fourth quarter of the prior year. The number of active associates in the North America region declined by 11.3 percent, compared with the fourth quarter of the prior year.
USANA develops and manufactures high-quality nutritional, personal-care and weight-management products that are sold directly to preferred customers and associates worldwide.
Immunotec Inc. (IMM-TSX VENTURE), a Canadian-based company and a leader in the wellness industry, reported financial results for the fiscal year 2010. Revenues totaled $40.3 million, compared to $44.7 million for the corresponding period last fiscal year. Importantly, the company was able to maintain an adjusted EBITDA of $774,000 or 2 percent of revenues compared to a negative $228,000 for Fiscal 2009. Net loss and comprehensive loss were $1,387,000 compared to a loss of $4,545,000 last year.
Network sales reached $34.5 million in 2010 compared to $37.9 million for the same period in 2009, a decrease of 9 percent or $3.4 million.
Immunotec is engaged primarily in the development and marketing of dietary supplements, food, vitamins, and personal care and natural health products. Immunotec’s products are distributed and sold in Canada and the United States through a network marketing system and in other countries under distributorship agreements.
Herbalife Ltd. (HLF-NYSE) reported that fourth-quarter net sales increased 17 percent and local currency net sales increased 19 percent compared to the same time period in 2009. Net income for the quarter of $81.0 million, or $1.31 per diluted share, compares to 2009 fourth-quarter adjusted net income and EPS of $61.7 million and 98 cents, respectively.
For the 12 months ended Dec. 31, 2010, the company reported record net sales of $2.7 billion, an 18 percent increase on 14 percent volume growth compared to 2009. For the same period, the company’s reported adjusted net income of $297.0 million, or $4.77 per diluted share, improved 43 percent and 45 percent, respectively, compared to the adjusted 2009 results of $207.1 million or $3.28 per diluted share.
For the year ended Dec. 31, 2010, the company generated cash flow from operations of $380.4 million, an increase of 33.4 percent compared to 2009, and paid dividends of $53.7 million.
Direct Selling News has accumulated this information from public sources, including press releases and SEC filings. The information is presumed accurate and reliable. However, it is not an endorsement of any investment opportunity. Proper and considerable due diligence should be completed before making any investment.