USANA Health Sciences Inc. (USNA, Financial) filed Quarterly Report for the period ended 2012-06-30.
Usana Health Sciences, Inc. has a market cap of $673.8 million; its shares were traded at around $44.2 with a P/E ratio of 12.3 and P/S ratio of 1.2. Usana Health Sciences, Inc. had an annual average earning growth of 18.1% over the past 10 years.
Asia Pacific: The increase in net sales in this region during the first six months of 2012 was driven by growth in Southeast Asia Pacific and Greater China, which was primarily the result of: (i) an increase in the average number of active Associates throughout the first six months of 2012, (ii) a surge in sales ahead of price increases that took place in certain of these markets, (iii) the impact of these price increases, and (iv) the introduction of our Lifetime Matching Bonus program and the related short-term promotion that we offered. We estimate that the surge in sales ahead of price increases added $11.0 million, that the price increases added $7.1 million, and that the short-term promotion added $3.8 million to net sales in this region during the first six months of 2012. Net sales also benefited by $0.8 million from the inclusion of Thailand in the current year. These increases were partially offset by certain events that contributed to sales in this region during the first six months of 2011 that did not occur in 2012, namely: (i) an estimated $4.0 million surge in sales ahead of certain strategic changes that were to be implemented in Hong Kong, and (ii) the recognition of approximately $3.0 million of deferred revenue during the first quarter of 2011.
Gross profit for the first six months of 2012 increased slightly to 82.4% of net sales compared with 82.3% in the prior year period, largely as a result of price increases in several of our international markets introduced toward the end of the first quarter of 2012. We also experienced benefits from leverage on increasing sales as well as an increasing percentage of sales from certain international markets where we have higher gross margins. Although currency fluctuation negatively impacted gross profit margins for the second quarter of 2012, we experienced an overall benefit to gross profit margins from currency fluctuation for the first six months of 2012. Improvements to gross margins during the first six months of 2012 were partially offset by increases in raw material costs.
Selling, general and administrative expenses decreased slightly to 23.7% of net sales for the first six months of 2012, compared with 23.8% for the same period in 2011. This slight change reflects leverage gained on increased sales outside the United States in markets where selling, general and administrative expenses are lower, partially offset by costs associated with opening our new markets and low initial sales in these markets.
We typically generate positive cash flow due to our strong operating margins. During the first six months of 2012, we had a net cash flow from operating activities of $43.9 million, compared with $31.4 million in the same period of 2011. The most significant factors contributing to this increase include higher net earnings and benefits from changes in operating assets and liabilities.
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Usana Health Sciences, Inc. has a market cap of $673.8 million; its shares were traded at around $44.2 with a P/E ratio of 12.3 and P/S ratio of 1.2. Usana Health Sciences, Inc. had an annual average earning growth of 18.1% over the past 10 years.
Highlight of Business Operations:
North America/Europe: The increase in net sales in this region during the first six months of 2012 when compared with the same period in 2011 was primarily due to increased sales per Associate and momentum generated, in large part, by the introduction of our Lifetime Matching Bonus program and the related short-term promotion that we offered in the second quarter. Net sales during the first six months of 2012 also benefited by $0.5 million from the inclusion of France and Belgium. These improvements were partially offset by the effects of fluctuations in foreign currency exchange rates, which reduced net sales in this region by $2.4 million during the first six months of 2012 when compared with the same period in 2011.Asia Pacific: The increase in net sales in this region during the first six months of 2012 was driven by growth in Southeast Asia Pacific and Greater China, which was primarily the result of: (i) an increase in the average number of active Associates throughout the first six months of 2012, (ii) a surge in sales ahead of price increases that took place in certain of these markets, (iii) the impact of these price increases, and (iv) the introduction of our Lifetime Matching Bonus program and the related short-term promotion that we offered. We estimate that the surge in sales ahead of price increases added $11.0 million, that the price increases added $7.1 million, and that the short-term promotion added $3.8 million to net sales in this region during the first six months of 2012. Net sales also benefited by $0.8 million from the inclusion of Thailand in the current year. These increases were partially offset by certain events that contributed to sales in this region during the first six months of 2011 that did not occur in 2012, namely: (i) an estimated $4.0 million surge in sales ahead of certain strategic changes that were to be implemented in Hong Kong, and (ii) the recognition of approximately $3.0 million of deferred revenue during the first quarter of 2011.
Gross profit for the first six months of 2012 increased slightly to 82.4% of net sales compared with 82.3% in the prior year period, largely as a result of price increases in several of our international markets introduced toward the end of the first quarter of 2012. We also experienced benefits from leverage on increasing sales as well as an increasing percentage of sales from certain international markets where we have higher gross margins. Although currency fluctuation negatively impacted gross profit margins for the second quarter of 2012, we experienced an overall benefit to gross profit margins from currency fluctuation for the first six months of 2012. Improvements to gross margins during the first six months of 2012 were partially offset by increases in raw material costs.
Selling, general and administrative expenses decreased slightly to 23.7% of net sales for the first six months of 2012, compared with 23.8% for the same period in 2011. This slight change reflects leverage gained on increased sales outside the United States in markets where selling, general and administrative expenses are lower, partially offset by costs associated with opening our new markets and low initial sales in these markets.
We typically generate positive cash flow due to our strong operating margins. During the first six months of 2012, we had a net cash flow from operating activities of $43.9 million, compared with $31.4 million in the same period of 2011. The most significant factors contributing to this increase include higher net earnings and benefits from changes in operating assets and liabilities.
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