Release Date: February 05, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Sales in Greater China increased by 7% compared to the fourth quarter of 2023, indicating positive consumer response to programs and promotions.
- Introduction of new products, such as the raspberry lemonade flavored Collagen Supreme and Root Revive hair serum, which were well-received in Hong Kong and are being rolled out in other markets.
- Successful Asia forum in Bangkok with over 430 attendees, setting a strong foundation for 2025 initiatives.
- Official opening of the Colombia market for in-country order taking, expanding the company's global reach.
- Continued focus on member engagement through training, personal development sessions, and recognition events, supporting recruitment and retention efforts.
Negative Points
- Overall sales remained flat compared to the previous year, indicating challenges in achieving growth.
- Decreases in sales in Taiwan and North America due to strategic price adjustments and fewer product promotions.
- Gross profit margin slightly declined to 74.2% from 74.5% due to higher freight costs.
- Operating loss increased to $421,000 compared to $242,000 in the fourth quarter of the previous year.
- Active member base declined by 5% since the end of December 2023, reflecting challenges in maintaining membership levels.
Q & A Highlights
Q: Can you provide more details on the performance in Greater China and the factors driving the sales increase?
A: Chris Sharng, President: Greater China saw a 7% increase in sales compared to the fourth quarter of 2023, and a 9% increase from the third quarter of 2024. This growth is attributed to our effective programs, trainings, promotions, and incentives that are resonating well with consumers and leaders in the region.
Q: What were the reasons behind the decline in sales in Taiwan and North America?
A: Chris Sharng, President: The declines in Taiwan and North America were due to strategic price adjustments made in 2023 and fewer product promotions throughout 2024. These efforts are aimed at safeguarding margins and reinforcing market discipline for long-term benefits.
Q: Could you elaborate on the new products introduced and their market reception?
A: Chris Sharng, President: In November, we launched two new products in Hong Kong: a raspberry lemonade flavored version of Collagen Supreme and a topical hair serum called Root Revive. These products were well-received, and we conducted a six-city roadshow in China to promote them. They have also been introduced in Taiwan and North America, with plans for further market rollouts.
Q: How did the annual Asia forum in Bangkok contribute to the company's strategy for 2025?
A: Chris Sharng, President: The Asia forum in Bangkok, attended by over 430 participants, served as a springboard for our 2025 programs and initiatives. It provided our leaders with a clear roadmap for success and a vision for the year ahead, ensuring alignment and motivation across our teams.
Q: What are the financial highlights for the fourth quarter and full year 2024?
A: Scott Davidson, CFO: Fourth quarter revenue was $10.8 million, nearly unchanged from the previous year. Gross profit margin slightly declined to 74.2% due to higher freight costs. Net income for the quarter was $176,000, or $0.02 per diluted share. For the full year, we generated $602,000 in cash flow from operations, a $1.8 million improvement over last year.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
