Nu Skin Enterprises, Inc. (NUS) has reported 6.54 percent rise in profit for the quarter ended Dec. 31, 2016. The company has earned $38.18 million, or $0.69 a share in the quarter, compared with $35.84 million, or $0.62 a share for the same period last year.
Revenue during the quarter dropped 7.14 percent to $531.33 million from $572.20 million in the previous year period. Gross margin for the quarter expanded 80 basis points over the previous year period to 79.58 percent. Total expenses were 88.56 percent of quarterly revenues, down from 89.21 percent for the same period last year. This has led to an improvement of 65 basis points in operating margin to 11.44 percent.
Operating income for the quarter was $60.78 million, compared with $61.71 million in the previous year period.
"I am optimistic about the future of Nu Skin," said Truman Hunt, president and chief executive officer. "I have worked closely with Ritch and Ryan for the past 15 years and have complete confidence that they have the experience, leadership and vision to take our business to the next level."
For the first-quarter, Nu Skin Enterprises projects revenue to be in the range of $480 million to $500 million. The company forecasts diluted earnings per share to be in the range of $0.47 to $0.51.
For financial year 2017, Nu Skin Enterprises projects revenue to be in the range of $2,260 million to $2,300 million. The company forecasts diluted earnings per share to be in the range of $3.10 to $3.25.
Working capital increases
Nu Skin Enterprises, Inc. has recorded an increase in the working capital over the last year. It stood at $315.33 million as at Dec. 31, 2016, up 5.53 percent or $16.53 million from $298.80 million on Dec. 31, 2015. Current ratio was at 1.79 as on Dec. 31, 2016, up from 1.73 on Dec. 31, 2015.
Cash conversion cycle (CCC) has decreased to 91 days for the quarter from 92 days for the last year period. Days sales outstanding were almost stable at 3 days for the quarter, when compared with the last year period.
Days inventory outstanding has increased to 106 days for the quarter compared with 100 days for the previous year period. At the same time, days payable outstanding went up to 17 days for the quarter from 11 for the same period last year.
Debt increases substantially
Nu Skin Enterprises, Inc. has witnessed an increase in total debt over the last one year. It stood at $416.89 million as on Dec. 31, 2016, up 67.03 percent or $167.30 million from $249.59 million on Dec. 31, 2015. Total debt was 28.28 percent of total assets as on Dec. 31, 2016, compared with 16.58 percent on Dec. 31, 2015. Debt to equity ratio was at 0.63 as on Dec. 31, 2016, up from 0.30 as on Dec. 31, 2015.
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