Reliv International, Inc., a nutrition and direct selling company, today reported its first quarter results. Net sales for the quarter declined to $23.8 million compared to net sales of $28.3 million in the first quarter of 2008.
Net income for the quarter was $1.0 million or $0.07 per diluted share, compared to net income of $1.5 million or $0.10 per diluted share in the 2008 first quarter.
The company reported a 19 percent increase, however, in the number of new distributors joining Reliv in the quarter, compared to the number joining in the first quarter of 2008. During the first quarter of 2009, Reliv enrolled approximately 8,400 new distributors compared to 7,030 in the prior year quarter.
During the first-quarter of 2009, U.S. net sales totaled $21.4 million, down 13.4 percent from the 2008 first quarter. Sales outside of the United States, were $2.4 million compared to $3.6 million in the prior year quarter. The strengthening of the U.S. dollar accounted for approximately one-half of the reported international sales decline.
Robert L. Montgomery, chairman, president and chief executive officer, said, "In an effort to increase sponsoring this year, beginning in January we began offering distributors half-price distributor kits. I believe that promotion, which will run through August, helped spur some of the new enrollments we saw in the first quarter."
"The solid increase in the number of new distributors is a good sign for Reliv's future," he said. "Typically, a strong increase in sponsorship leads to sales growth, and we hope to see growth in sales this year. In addition, we plan to increase initiatives designed to help convert our new distributors into Master Affiliates, which are our business builders," Montgomery added.
"During the second quarter, our senior executives, including myself, are planning to visit as many as a dozen cities as a means of maintaining the sponsoring momentum," Montgomery said. Those meetings are expected to highlight the value of the Reliv business opportunity.
Montgomery said, "Reliv's business directly addresses two consumer needs right now. One, consumers increasingly are looking for ways to supplement their income or to replace lost income. Two, consumers continue to seek ways to improve their health. We're well positioned in both cases."
In the first quarter, Reliv generated net cash from operating activities of $2.8 million, down from $3.2 million for the same quarter last year. Reliv had approximately $7.0 million in cash and cash-equivalents as of March 31, 2009.
As of March 31, 2009, Reliv had 68,680 distributors, a slight decline of 1.5 percent compared to the number of distributors at the end of the first quarter 2008. The March 2009 distributor total represents a 2 percent increase over the distributor total as of December 31, 2008 of 67,340.
"Reliv makes nutrition simple, and we offer a great business opportunity,"Montgomery said. "In addition, we believe Reliv has great growth potential both within and outside of the United States."
Buyout of major shareholder
Earlier this week, Reliv announced that it has acquired approximately 2.1 million shares formerly owned by the Paul and Jane Meyer Family Foundation, which had been Reliv's second largest shareholder.
CEO Montgomery said, "We believe the buyout is good for Reliv, our shareholders, distributors and employees. The purchase reflects the board's and management's confidence in the future of Reliv."
Reliv will host a conference call to discuss first-quarter earnings with investors at 1:00 p.m. Eastern Time on April 30th. The dial-in number for investors is 888-713-4213. The participant passcode is 52123645. To register, please call in 15 minutes prior to start of the call. A replay of this call will be available for one week by telephone from 3:00 p.m. Eastern by calling 888-286-8010 and using the passcode 31442555. A live web cast of this call will be available through the Investor Relations section of Reliv's Web site: http://www.reliv.com/US/EN/Conference%20Calls%20Presentations.html. An online archive of the broadcast will be available on Reliv's Web site in the Investor Relations section 24 hours after the call concludes.
Reliv International, Inc., based in Chesterfield, Mo., is a developer, manufacturer and marketer of a proprietary line of nutritional supplements. Reliv supplements address essential daily nutrition, weight loss and targeted solutions such as energy and performance enhancement, digestive health, women's health and anti-aging. Reliv sells its products through an international network marketing system of 68,680 independent distributors. Additional information about Reliv International, Inc. can be obtained on the Web at www.reliv.com.