PROVO, Utah, July 31, 2006 /PRNewswire-FirstCall via COMTEX/ -- Nu Skin Enterprises, Inc. (NUS) announced today that it has received official notification that the company has received approval from the Chinese Ministry of Commerce to commence direct selling activities in Mainland China. As one of the earliest international companies to be granted a direct selling license, Nu Skin Enterprises will begin adding direct selling to the retail business model it has pursued in China since 2003.
"We are honored that the Chinese government has granted us authorization to conduct direct selling in China," said President and Chief Executive Officer Truman Hunt. "We respect the work completed by Chinese officials in establishing a framework that enables the Chinese population to take advantage of the benefits of direct selling. We believe the government's approval of our application recognizes Nu Skin Enterprises as an industry leader and is a reflection of our significant investment in China over the past several years, our conservative business approach that is focused on long-term success in the market, and our willingness to abide by applicable regulations.
"The licensing process included a thorough review of the company's operations. With the Ministry of Commerce approval we are authorized to initiate direct selling activities in our home base of Shanghai, which we will begin in the fourth quarter of this year. We will then move forward with the provincial license approval process as we begin introducing our direct selling operations throughout China in early 2007," Hunt continued.
"The direct selling license provides Nu Skin Enterprises with four key advantages. These benefits include the ability to begin selling away from our approximately 160 fixed retail locations; the opportunity to engage an entry-level, non-employee, part-time sales force; the establishment of a level playing field on which to compete with other approved direct selling entities in China; and the benefits that come from having the government's 'stamp of approval' on our business model. These advantages will ultimately benefit our direct selling representatives by providing them with additional rewards and tools to support their selling efforts. Additionally, our customers will enjoy the benefits of our direct selling model with easier and more convenient access to the more than 120 innovative products we offer.
"We have been preparing for this event for the past four years. I am confident that we have the employee force, management team and infrastructure in place to realize our goal of becoming the leading direct selling company in this important market," concluded Hunt.
Nu Skin Enterprises, Inc. is a global direct selling company operating in 43 markets throughout Asia, the Americas and Europe. The company markets premium-quality personal care products under the Nu Skin(R) brand, science-based nutritional supplements under the Pharmanex(R) brand, and technology-based products and services under the Big Planet(R) brand. Nu Skin Enterprises is traded on the New York Stock Exchange under the symbol "NUS."
Please note: This press release contains forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934 that represent the company's current expectations and beliefs, including, among other things, the company's operational plans in China and the anticipated impact of direct selling on the company's business in that market. The forward-looking statements and related assumptions involve risks and uncertainties that could cause actual results and outcomes to differ materially from any forward-looking statements or views expressed herein, including, but not limited to, (i) there can be no assurance that the implementation of a direct selling component to the company's business model in China will allow the company to successfully grow in this market given the restrictive nature of the direct selling laws; (ii) continued regulatory scrutiny of direct selling companies in China could negatively impact the company's operations; and (iii) any delays in establishing service centers and obtaining provincial licenses as the company rolls out its direct selling model throughout China. The forward-looking statements contained herein are further qualified by a detailed discussion of associated risks set forth in the documents filed by the company with the Securities and Exchange Commission, including the company's Annual Report on Form 10-K/A filed on March 17, 2006. The forward-looking statements set forth the company's beliefs as of the date of this release and the company assumes no duty to update the forward-looking statements contained in this release to reflect any change.