Nu Skin Enterprises Inc. (NYSE:NUS) Q1 2020 Earnings Conference Call - Final Transcript

May 06, 2020 • 05:00 pm ET

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Nu Skin Enterprises Inc. (NYSE:NUS) Q1 2020 Earnings Conference Call - Final Transcript

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Presentation
Operator
Operator

Ladies and gentlemen, thank you for standing by, and welcome to the Q1 2020 Nu Skin Enterprises Earnings Conference Call. [Operator Instructions]

I would now like to hand the conference over to your speaker today, Scott Pond, Vice President of Investor Relations. Thank you. Please go ahead, sir.

Executive
Scott Pond

Thanks, Christy, and good afternoon, everyone. Today on the call with me are Ritch Wood, Chief Executive Officer; Ryan Napierski, President; Mark Lawrence, Chief Financial Officer; and Dr. Joe Chang, Chief Scientific Officer.

On today's call, comments will be made that include some forward-looking statements. These statements involve risks and uncertainties, and actual results may differ materially from those discussed or anticipated. Please refer to today's earnings release and our SEC filings for a complete discussion of these risks. Also during the call, certain financial numbers may be discussed that differ from comparable numbers obtained in our financial statements. We believe these non-GAAP financial numbers assist in comparing period-to-period results in a more consistent manner. Please refer to our investor page at ir.nuskin.com for any required reconciliation of non-GAAP numbers.

And with that, I'll turn the time over to Ritch.

Executive
Ritch N. Wood

Thank you, Scott, and good afternoon, everyone. Thank you for taking some time to join with us today. Last time, we spoke about our results in early February, we mentioned the difficulty of predicting the impact of coronavirus on our business. Since then, what began as a regional outbreak has grown into a global pandemic.

On behalf of the entire team at Nu Skin, our hearts go out to all those impacted. And we are grateful for the efforts of health care workers, first responders and essential workers around the world. For our part, we are diligently working to protect the health and safety of our employees, our sales leaders and communities around the world, including significant donations to support COVID-19 relief efforts. While Nu Skin is not immune to a disruption of this magnitude, we are fortunate to have a flexible business model built on empowering people to work remotely.

For example, more than 80% of our revenue globally is already processed online. We also learned valuable lessons in 2019 when government actions significantly restricted meetings and gatherings for much of the year in Mainland China.

This experience has helped prepare our business and sales representatives to operate in today's reality. This is demonstrated by the fact that we produced first quarter results above our guidance with revenue of $518 million and earnings per share of $0.36, including a 2% foreign currency headwind. Our dedicated and resilient sales leaders remain focused on building their businesses and providing top-notch service to their customers. Our customer numbers held steady on a sequential basis, which is notable, given the sequential nature and the cyclical nature of our business, where the first quarter typically shows a sequential decline. While our sales leader numbers were down year-over-year, primarily due to the decline during 2019. We are pleased that the seasonal decline in the first quarter was slightly