Market Overview

Reliv International Reports First-Quarter Financial Results for 2020

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CHESTERFIELD, Mo,, May 15, 2020 /PRNewswire/ -- Reliv International, Inc. (NASDAQ:RELV), a developer and marketer of nutritional supplements that promote optimal health, today reported its financial results for the first quarter of 2020.

First-Quarter Results

Reliv reported net sales of $10.3 million for the first quarter of 2020 compared with net sales of $9.5 million in the first quarter of 2019. Net sales in the United States increased to $7.8 million in the first quarter of 2019, which represented a 10.3% increase in net sales when compared to the prior-year quarter.  Net sales in Reliv's foreign markets increased 2.6% in the first quarter of 2020 compared with the prior-year first quarter. Increases in net sales in Asia and Europe were 10.1% and 2.4%, respectively, in the first quarter of 2020, offset by decreases in net sales in other regions. 

Reliv reported net income for the first quarter of 2020 of $662,000 (earnings per diluted share of $0.38) compared to net income of $624,000 (earnings per diluted share of $0.36) in the first quarter of 2019. The income from operations for the first quarter of 2020 was $522,000 compared to $199,000 in the same period in 2019. Results from operations in 2020 were favorably impacted by the improvement in net sales and resulting gross margin in the United States and most of Reliv's foreign markets. Reliv also recognized an income tax benefit of $178,000 in the first quarter of 2020.  This benefit was the result of the Coronavirus Aid, Relief, and Economic Security (CARES) Act which was signed into law in late March 2020. Under the CARES Act, the U.S. net operating loss (NOL) arising in our 2018 tax year may be carried back up to five years. Based on this new legislation, we have recognized a $225,000 estimated income tax benefit for the NOL carryback.

Reliv had cash and cash equivalents of $2.8 million as of March 31, 2020, compared to $1.6 million as of December 31, 2019.  Net cash provided by operating activities was $1.3 million in the first quarter of 2020.

As of March 31, 2020, Reliv had 13,680 retail customers and Preferred Customers in total – a decrease of 6.9% from March 31, 2019. This count does not include those customers that buy product directly from distributors rather than from us. As of March 31, 2020, Reliv had 25,550 active Distributors – an increase of 1.0% from March 31, 2019. The number of Master Affiliates increased by 7.7% compared to the year-ago total, driven by the growth in Master Affiliates in Asia of 74.3%.  Master Affiliate is the level at which Distributors are eligible to earn generation royalties. 

"We were pleased with our performance in the first quarter," commented Ryan A. Montgomery, Chief Executive Officer. "It showed the strength of consumer demand for our products, but we recognize a portion of the increase may be due to product supply concerns caused by these uncertain times. We have reassured customers of the continued supply of our products, and in an effort to continue the upward trend in consumer sales, we began offering free enrollments in our Preferred Customer program in April and are continuing this incentive during the month of May."

"To improve our outreach, we have substantially increased our use of online technology as our primary method of communication and training with our customers and distributors as we adapt to the realities of the world today," Montgomery noted. Reliv recently announced that its U.S. distributor conference originally planned to be held in St. Louis in late July will instead be a world-wide online conference. "We felt this was the right decision to make well in advance of the scheduled conference date. We are excited by the opportunity of reaching out to a much larger audience, not only in the United States, but all over the Reliv world."

Prior to the COVID-19 outbreak, Reliv held a successful distributor conference in Dallas in mid-February where the company introduced its latest offering in the RLV line of hemp-extract products—a sleep-aid tincture that includes melatonin. 

In international operations, net sales in the Philippines and Europe grew in the first quarter in spite of earlier and more restrictive COVID-19 guidelines than experienced in most of the United States.  Net sales in Asia and Europe grew by 10.1% and 2.4%, respectively, in the first quarter of 2020, compared to the prior-year quarter. Montgomery commented, "We are pleased by the resilience of the sales in these regions; however, we are cautious in our plans with the uncertainty of the long-term impact of the pandemic in various parts of the Reliv world."

About Reliv International, Inc.

Reliv International, based in Chesterfield, MO, develops and markets nutritional supplements that promote optimal nutrition. Reliv supplements address core nutrition, targeted solutions and overall wellness and now include a line of RLV hemp extracts. Reliv is the exclusive provider of LunaRich® products, which optimize levels of lunasin, a soy peptide that works at the epigenetic level to promote optimal health. The company sells its products through an international network marketing system of independent distributors in 13 countries. Learn more about Reliv at reliv.com, or on FacebookTwitter or Instagram.

Statements made in this news release that are not historical facts are "forward-looking" statements (as defined in the Private Securities Litigation Reform Act of 1995) that involve risks and uncertainties and are subject to change at any time. These forward-looking statements may include, but are not limited to, statements containing words such as "may," "should," "could," "would," "expect," "plan," "anticipate," "believe," "estimate," "predict," "potential," "continue" or similar expressions. Factors that could cause actual results to differ are identified in the public filings made by Reliv with the Securities and Exchange Commission. More information on factors that could affect Reliv's business and financial results are included in its public filings made with the Securities and Exchange Commission, including its Annual Report on Form 10-K and Quarterly Reports on Form 10-Q, copies of which are available on the Company's web site, reliv.com.

For more information, contact:

Steve Albright                                                     
Chief Financial Officer                                
(636) 733-1305        

--FINANCIAL HIGHLIGHTS FOLLOW –

Reliv International, Inc. and Subsidiaries






Condensed Consolidated Balance Sheets




March 31

December 31


2020

2019


(Unaudited)

(Audited)

Assets



Current Assets:



Cash and cash equivalents

$2,828,639

$1,630,779

Accounts receivable, less allowances of



$5,000 in 2020 and 2019

215,045

107,369

Notes & accounts receivables & deposits - related parties

1,091,247

1,099,228

Inventories

2,809,829

2,701,688

Other current assets

909,038

326,454




Total current assets

7,853,798

5,865,518




Notes & accounts receivables - related parties

2,390,930

2,418,921

Other assets

2,436,718

2,581,717

Net property, plant and equipment

4,359,436

4,440,840




Total Assets

$17,040,882

$15,306,996




Liabilities and Stockholders' Equity






Accounts payable, accruals & other current liabilities

$4,624,415

$3,489,157

Revolving line of credit

500,000

500,000

Other noncurrent liabilities

192,099

216,196

Stockholders' equity

11,724,368

11,101,643




Total Liabilities and Stockholders' Equity

$17,040,882

$15,306,996







Consolidated Statements of Operations




Three months ended March 31


2020

2019


(Unaudited)

(Unaudited)

Product sales

$9,548,817

$8,810,997

Freight income

558,095

519,941

Other revenue

175,753

158,566




Net Sales

10,282,665

9,489,504




Costs and expenses:



  Cost of goods sold

2,654,843

2,433,732

  Distributor royalties and commissions

3,328,455

3,117,572

  Selling, general and administrative

3,777,682

3,739,527




Total Costs and Expenses

9,760,980

9,290,831




Income from operations

521,685

198,673




Other income (expense):



Interest income

39,662

49,262

Interest expense

(6,105)

(5,412)

Other expense

(70,906)

(5,428)

Gain on sale of fixed assets

-

434,549




Income before income taxes

484,336

671,644

Provision (benefit) for income taxes

(178,000)

48,000




Net income

$662,336

$623,644







Earnings per common share - Basic & Diluted

$0.38

$0.36

Weighted average shares 

1,746,000

1,746,000

 

Reliv International, Inc. and Subsidiaries
















Net sales by Market





(in thousands)

Three months ended March 31,


Change from


2020


2019


prior year


Amount

% of Net
Sales


Amount

% of Net
Sales


Amount

%










United States

$         7,842

76.3%


$         7,112

74.9%


$            730

10.3%

Australia/New Zealand

170

1.6%


177

1.9%


(7)

-4.0%

Canada

159

1.5%


199

2.1%


(40)

-20.1%

Mexico

129

1.3%


136

1.4%


(7)

-5.1%

Europe

962

9.4%


939

9.9%


23

2.4%

Asia

1,021

9.9%


927

9.8%


94

10.1%










Consolidated Total

$       10,283

100.0%


$         9,490

100.0%


$            793

8.4%

The tables below set forth, as of March 31, 2020 and 2019, the number of our Retail Customers/Preferred Customers/Active Distributors and Master Affiliates and above.  The total number of active distributors includes Master Affiliates and above. We define an active retail or preferred customer as one that has placed a product order in the prior twelve months, and we define an active distributor as one that enrolls as a distributor or renews his or her distributorship during the prior twelve months. Many individuals join Reliv as distributors to obtain our products at a discount and may not participate in the Reliv business opportunity. Master Affiliates and above are distributors that have attained the highest level of discount and are eligible for royalties generated by Master Affiliate groups in their downline organization.

Reliv International, Inc. and Subsidiaries










Retail and Preferred Customers/Active Distributors/Master Affiliates and Above by Market








As of 3/31/2020


Retail
Customers

Preferred
Customers

Active
Distributors

Total
Customers and
Distributors

Master
Affiliates and
Above








United States

3,580

1,450

17,460

22,490

1,860

Australia/New Zealand

50

210

650

910

80

Canada

80

30

470

580

60

Mexico

20

100

1,050

1,170

80

Europe

690

660

1,620

2,970

260

Asia

1,370

5,440

4,300

11,110

610







Consolidated Total

5,790

7,890

25,550

39,230

2,950

                                                

Reliv International, Inc. and Subsidiaries










Retail and Preferred Customers/Active Distributors/Master Affiliates and Above by Market

(continued)













As of 3/31/2019


Retail
Customers

Preferred
Customers

Active
Distributors

Total
Customers and
Distributors

Master
Affiliates and
Above








United States

3,960

1,560

18,040

23,560

1,880

Australia/New Zealand

40

220

710

970

70

Canada

100

20

520

640

60

Mexico

10

110

1,020

1,140

80

Europe

560

1,140

1,800

3,500

300

Asia

3,020

3,950

3,210

10,180

350







Consolidated Total

7,690

7,000

25,300

39,990

2,740




















Change in %


Retail
Customers

Preferred
Customers

Active
Distributors

Total
Customers and
Distributors

Master
Affiliates and
Above








United States

-9.6%

-7.1%

-3.2%

-4.5%

-1.1%

Australia/New Zealand

25.0%

-4.5%

-8.5%

-6.2%

14.3%

Canada

-20.0%

50.0%

-9.6%

-9.4%

0.0%

Mexico

100.0%

-9.1%

2.9%

2.6%

0.0%

Europe

23.2%

-42.1%

-10.0%

-15.1%

-13.3%

Asia

-54.6%

37.7%

34.0%

9.1%

74.3%







Consolidated Total

-24.7%

12.7%

1.0%

-1.9%

7.7%

 

Cision View original content to download multimedia:http://www.prnewswire.com/news-releases/reliv-international-reports-first-quarter-financial-results-for-2020-301059829.html

SOURCE Reliv International

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