Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Sep. 30, 2015 | Oct. 30, 2015 | |
Document and Entity Information [Abstract] | ||
Entity Registrant Name | NU SKIN ENTERPRISES INC | |
Entity Central Index Key | 1,021,561 | |
Current Fiscal Year End Date | --12-31 | |
Entity Well-known Seasoned Issuer | Yes | |
Entity Voluntary Filers | No | |
Entity Current Reporting Status | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Common Stock, Shares Outstanding | 57,230,966 | |
Document Fiscal Year Focus | 2,015 | |
Document Fiscal Period Focus | Q3 | |
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Sep. 30, 2015 |
Consolidated Balance Sheets (Un
Consolidated Balance Sheets (Unaudited) - USD ($) $ in Thousands | Sep. 30, 2015 | Dec. 31, 2014 |
Current assets: | ||
Cash and cash equivalents | $ 305,808 | $ 288,415 |
Current investments | 10,883 | 11,793 |
Accounts receivable | 35,682 | 35,834 |
Inventories, net | 260,464 | 338,491 |
Prepaid expenses and other | 164,046 | 160,134 |
Total current assets | 776,883 | 834,667 |
Property and equipment, net | 459,644 | 464,783 |
Goodwill | 112,446 | 112,446 |
Other intangible assets, net | 68,862 | 75,062 |
Other assets | 135,623 | 127,476 |
Total assets | 1,553,458 | 1,614,434 |
Current liabilities: | ||
Accounts payable | 35,718 | 34,712 |
Accrued expenses | 308,600 | 300,847 |
Current portion of long-term debt | 66,743 | 82,770 |
Total current liabilities | 411,061 | 418,329 |
Long-term debt | 186,222 | 164,567 |
Other liabilities | 95,657 | 89,100 |
Total liabilities | $ 692,940 | $ 671,996 |
Commitments and contingencies (Note 9) | ||
Stockholders' equity: | ||
Class A common stock - 500 million shares authorized, $.001 par value, 90.6 million shares issued | $ 91 | $ 91 |
Additional paid-in capital | 415,026 | 414,394 |
Treasury stock, at cost - 31.7 million and 32.2 million shares | (959,504) | (862,608) |
Accumulated other comprehensive loss | (73,000) | (51,521) |
Retained earnings | 1,477,905 | 1,442,082 |
Total stockholders' equity | 860,518 | 942,438 |
Total liabilities and stockholders' equity | $ 1,553,458 | $ 1,614,434 |
Consolidated Balance Sheets (U3
Consolidated Balance Sheets (Unaudited) (Parenthetical) - $ / shares shares in Millions | Sep. 30, 2015 | Dec. 31, 2014 |
Stockholders' equity: | ||
Common stock, shares authorized (in shares) | 500 | 500 |
Common stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Common stock, shares issued (in shares) | 90.6 | 90.6 |
Treasury stock (in shares) | 33.1 | 31.6 |
Consolidated Statements of Inco
Consolidated Statements of Income (Unaudited) - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | |
Consolidated Statements of Income (Unaudited) [Abstract] | ||||
Revenue | $ 571,308 | $ 638,800 | $ 1,674,849 | $ 1,959,888 |
Cost of sales | 152,755 | 109,275 | 368,073 | 371,929 |
Gross profit | 418,553 | 529,525 | 1,306,776 | 1,587,959 |
Operating expenses: | ||||
Selling expenses | 240,260 | 263,203 | 713,714 | 859,879 |
General and administrative expenses | 135,752 | 161,366 | 410,074 | 467,190 |
Total operating expenses | 376,012 | 424,569 | 1,123,788 | 1,327,069 |
Operating income | 42,541 | 104,956 | 182,988 | 260,890 |
Other income (expense), net | (14,428) | 1,073 | (29,454) | (37,554) |
Income before provision for income taxes | 28,113 | 106,029 | 153,534 | 223,336 |
Provision for income taxes | 11,846 | 37,721 | 56,328 | 80,667 |
Net income | $ 16,267 | $ 68,308 | $ 97,206 | $ 142,669 |
Net income per share (Note 2): | ||||
Basic (in dollars per share) | $ 0.28 | $ 1.15 | $ 1.66 | $ 2.42 |
Diluted (in dollars per share) | $ 0.28 | $ 1.12 | $ 1.63 | $ 2.34 |
Weighted-average common shares outstanding (000s): | ||||
Basic (in shares) | 57,725 | 59,249 | 58,403 | 59,058 |
Diluted (in shares) | 58,663 | 60,777 | 59,565 | 61,010 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | |
Consolidated Statements of Comprehensive Income (Unaudited) [Abstract] | ||||
Net Income (Loss) Attributable to Parent | $ 16,267 | $ 68,308 | $ 97,206 | $ 142,669 |
Other Comprehensive Income (Loss), Net of Tax [Abstract] | ||||
Foreign currency translation adjustment | (9,629) | (3,392) | (20,355) | 1,578 |
Net unrealized gains/(losses) on foreign currency cash flow hedges | (110) | 1,239 | 199 | 656 |
Less: Reclassification adjustment for realized losses/gains in current earnings | (10) | (527) | (1,323) | (970) |
Total | (9,749) | (2,680) | (21,479) | 1,264 |
Comprehensive Income | $ 6,518 | $ 65,628 | $ 75,727 | $ 143,933 |
Consolidated Statements of Com6
Consolidated Statements of Comprehensive Income (Unaudited) (Parenthetical) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | |
Other comprehensive income, net of tax: | ||||
Foreign currency translation adjustment, tax | $ 2,787 | $ (2,311) | $ (3,036) | $ (2,367) |
Net unrealized gains/(losses) on foreign currency cash flow hedges, tax | 61 | (683) | (109) | (361) |
Reclassification adjustment for realized losses/(gains) in current earnings, tax | $ 5 | $ 290 | $ 729 | $ 535 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2015 | Sep. 30, 2014 | |
Cash flows from operating activities: | ||
Net income | $ 97,206 | $ 142,669 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Depreciation and amortization | 52,101 | 38,933 |
Foreign currency (gains)/losses | 24,953 | 47,570 |
Stock-based compensation | 4,444 | 16,320 |
Deferred taxes | 12,110 | 8,795 |
Changes in operating assets and liabilities: | ||
Accounts receivable | (2,067) | 27,094 |
Inventories, net | 65,692 | (37,107) |
Prepaid expenses and other | (3,586) | (41,879) |
Other assets | (18,387) | (17,721) |
Accounts payable | 2,252 | (53,273) |
Accrued expenses | 15,455 | (284,965) |
Other liabilities | (8,209) | 2,307 |
Net cash provided by operating activities | 241,964 | (151,257) |
Cash flows from investing activities: | ||
Purchases of property and equipment | (44,171) | (80,580) |
Proceeds of investment sales | 11,526 | 27,328 |
Purchases of investments | (11,526) | (17,522) |
Net cash used in investing activities | (44,171) | (70,774) |
Cash flows from financing activities: | ||
Exercise of employee stock options | (1,107) | (3,146) |
Payment of debt | (31,954) | (102,167) |
Payment of cash dividends | (61,382) | (60,964) |
Income tax benefit of options exercised | 4,731 | 9,637 |
Proceeds from debt | 36,217 | 115,220 |
Repurchases of shares of common stock | (104,058) | (25,002) |
Net cash used in financing activities | (157,553) | (66,422) |
Effect of exchange rate changes on cash | (22,847) | (41,756) |
Net increase in cash and cash equivalents | 17,393 | (330,209) |
Cash and cash equivalents, beginning of period | 288,415 | 525,153 |
Cash and cash equivalents, end of period | $ 305,808 | $ 194,944 |
THE COMPANY
THE COMPANY | 9 Months Ended |
Sep. 30, 2015 | |
THE COMPANY [Abstract] | |
THE COMPANY | THE COMPANY Nu Skin Enterprises, Inc. (the "Company") is a leading, global direct selling company that develops and distributes premium-quality, innovative personal care products and nutritional supplements that are sold worldwide under the Nu Skin and Pharmanex brands and a small number of other products and services. Over the last several years, the Company has introduced new Pharmanex nutritional supplements and Nu Skin personal care products under its ageLOC anti-aging brand. The Company reports revenue from five geographic regions: Greater China, which consists of Mainland China, Hong Kong, Macau and Taiwan; North Asia, which consists of Japan and South Korea; South Asia/Pacific, which consists of Australia, Brunei, French Polynesia, Indonesia, Malaysia, New Caledonia, New Zealand, the Philippines, Singapore, Thailand and Vietnam; Americas, which consists of the United States, Canada and Latin America; and Europe, Middle East and Africa ("EMEA"), which consists of several markets in Europe as well as Israel, Russia, Ukraine and South Africa (the Company's subsidiaries operating in these countries in each region are collectively referred to as the "Subsidiaries"). The accompanying unaudited consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America for interim financial information and with the instructions to Form 10-Q and Rule 10-01 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by accounting principles generally accepted in the United States of America for complete financial statements. The unaudited consolidated financial statements include the accounts of the Company and its Subsidiaries. All significant intercompany accounts and transactions are eliminated in consolidation. In the opinion of management, the accompanying unaudited consolidated financial statements contain all adjustments, consisting of normal recurring adjustments, considered necessary for a fair statement of the Company's financial information as of September 30, 2015, and for the three- and nine-month periods ended September 30, 2015 and 2014. The results of operations of any interim period are not necessarily indicative of the results of operations to be expected for the fiscal year. The consolidated balance sheet as of December 31, 2014 has been prepared using information from the audited financial statements at that date. For further information, refer to the consolidated financial statements and accompanying footnotes included in the Company's Annual Report on Form 10-K for the year ended December 31, 2014. Certain prior-year amounts in the Consolidated Statements of Income, none of which are material to current or prior periods, have not been reclassified to conform with the current year presentation. |
NET INCOME PER SHARE
NET INCOME PER SHARE | 9 Months Ended |
Sep. 30, 2015 | |
NET INCOME PER SHARE [Abstract] | |
NET INCOME PER SHARE | 2. NET INCOME PER SHARE Net income per share is computed based on the weighted-average number of common shares outstanding during the periods presented. Additionally, diluted earnings per share data gives effect to all potentially dilutive common shares that were outstanding during the periods presented. For the three-month periods ended September 30, 2015 and 2014, stock options of 1.6 million and 2.8 million, respectively, and for the nine-month periods ended September 30, 2015 and 2014, stock options of 1.6 million and 2.1 million, respectively, were excluded from the calculation of diluted earnings per share because they were anti-dilutive. |
DIVIDENDS PER SHARE
DIVIDENDS PER SHARE | 9 Months Ended |
Sep. 30, 2015 | |
DIVIDENDS PER SHARE [Abstract] | |
DIVIDENDS PER SHARE | 3. DIVIDENDS PER SHARE In January, April and August 2015, the Company's board of directors declared a quarterly cash dividend of $0.35 per share. These quarterly cash dividends of $20.7 million, $20.5 million and $20.2 million were paid on March 18, 2015, June 10, 2015 and September 16, 2015 to stockholders of record on February 27, 2015, May 22, 2015 and August 28, 2015. In October 2015, the Company's board of directors declared a quarterly cash dividend of $0.35 per share to be paid on December 9, 2015 to stockholders of record on November 20, 2015. |
DERIVATIVE FINANCIAL INSTRUMENT
DERIVATIVE FINANCIAL INSTRUMENTS | 9 Months Ended |
Sep. 30, 2015 | |
DERIVATIVE FINANCIAL INSTRUMENTS [Abstract] | |
DERIVATIVE FINANCIAL INSTRUMENTS | 4. DERIVATIVE FINANCIAL INSTRUMENTS The Company held mark-to-market forward contracts designated as foreign currency cash flow hedges with notional amounts of 2.0 billion Japanese yen and 15.0 million euros ($16.7 million and $16.8 million, respectively) as of September 30, 2015 and 800 million Japanese yen and 7.0 million euros ($7.3 million and $8.8 million, respectively) as of September 30, 2014, to hedge forecasted foreign-currency-denominated intercompany transactions. The contracts held at September 30, 2015 have maturities through December 2016 and accordingly, all unrealized gains and losses on foreign currency cash flow hedges included in accumulated other comprehensive loss will be recognized in current earnings over the next 15 months. The pre-tax net gains on foreign currency cash flow hedges reclassified from accumulated other comprehensive loss to the income statement were none and $0.8 million, respectively, for the three-month periods ended September 30, 2015 and 2014 and $2.1 million and $1.5 million, respectively, for the nine-month periods ended September 30, 2015 and 2014. The corresponding tax effects of these transactions were recorded in provision for income tax expense. As of September 30, 2015 and December 31, 2014, there were $0.1 million of unrealized losses and $1.1 million of unrealized gains included in accumulated other comprehensive loss related to foreign currency cash flow hedges. The remaining $72.9 million and $52.6 million as of September 30, 2015 and December 31, 2014, respectively, in accumulated other comprehensive loss are related to cumulative translation adjustments. |
REPURCHASES OF COMMON STOCK
REPURCHASES OF COMMON STOCK | 9 Months Ended |
Sep. 30, 2015 | |
REPURCHASES OF COMMON STOCK [Abstract] | |
REPURCHASES OF COMMON STOCK | 5. REPURCHASES OF COMMON STOCK During the three-month period ended September 30, 2015, the Company repurchased 0.6 million shares of its Class A common stock under its open market stock repurchase plan for $28.2 million. The Company did not repurchase any shares of its Class A common stock under its open market stock repurchase plan during the three-month period ended September 30, 2014. During the nine-month periods ended September 30, 2015 and 2014, the Company repurchased 2.1 million and 0.3 million shares of its Class A common stock under its open market repurchase plan for $104.1 million and $25.0 million, respectively. As of September 30, 2015, $244.8 million was available for repurchases under the open market stock repurchase plan. In October 2015, our board terminated the open market stock repurchase plan and approved a new repurchase plan with an initial authorization amount of $500.0 million. |
SEGMENT INFORMATION
SEGMENT INFORMATION | 9 Months Ended |
Sep. 30, 2015 | |
SEGMENT INFORMATION [Abstract] | |
SEGMENT INFORMATION | 6. SEGMENT INFORMATION The Company operates in a single operating segment by selling products through a global network of independent distributors that operates in a seamless manner from market to market, except for its operations in Mainland China. In Mainland China, the Company utilizes sales employees, independent direct sellers and independent marketers to distribute its products. Independent direct sellers can sell away from the Company's stores where the Company has obtained a direct selling license to do so. Independent marketers are licensed business owners who are authorized to sell the Company's products either at their own approved premises or through the Company's stores. Selling expenses are the Company's largest expense, comprised of sales compensation and incentives paid to its sales force. The Company manages its business primarily by managing its sales force. The Company does not use profitability reports on a regional or divisional basis for making business decisions. However, the Company does report revenue in five geographic regions: Greater China, North Asia, South Asia/Pacific, Americas and EMEA. NU SKIN ENTERPRISES, INC. Notes to Consolidated Financial Statements Revenue generated in each of these regions is set forth below (U.S. dollars in thousands): Three Months Ended Nine Months Ended September 30, September 30, Revenue: 2015 2014 2015 2014 Greater China $ 188,669 $ 226,744 $ 576,172 $ 735,542 North Asia 167,748 205,488 512,757 596,944 South Asia/Pacific 108,857 88,915 247,697 241,762 Americas 70,775 76,737 234,115 246,557 EMEA 35,259 40,916 104,108 139,083 Totals $ 571,308 $ 638,800 $ 1,674,849 $ 1,959,888 Revenue generated by each of the Company's product lines is set forth below (U.S. dollars in thousands): Three Months Ended Nine Months Ended September 30, September 30, Revenue: 2015 2014 2015 2014 Nu Skin $ 324,115 $ 392,513 $ 1,018,317 $ 1,186,592 Pharmanex 245,569 244,690 652,345 768,178 Other 1,624 1,597 4,187 5,118 Totals $ 571,308 $ 638,800 $ 1,674,849 $ 1,959,888 Additional information as to the Company's operations in its most significant geographic areas is set forth below (U.S. dollars in thousands): Three Months Ended Nine Months Ended September 30, September 30, Revenue: 2015 2014 2015 2014 Mainland China $ 138,050 $ 152,983 $ 421,498 $ 518,995 South Korea 104,012 127,094 321,812 359,891 Japan 63,736 78,394 190,945 237,053 United States 52,720 54,241 170,288 170,119 Long-lived assets: September 30, 2015 December 31, 2014 Mainland China $ 112,915 $ 103,445 South Korea 48,977 46,626 Japan 14,404 13,768 United States 272,034 287,103 |
DEFERRED TAX ASSETS AND LIABILI
DEFERRED TAX ASSETS AND LIABILITIES | 9 Months Ended |
Sep. 30, 2015 | |
DEFERRED TAX ASSETS AND LIABILITIES [Abstract] | |
DEFERRED TAX ASSETS AND LIABILITIES | 7. DEFERRED TAX ASSETS AND LIABILITIES The Company accounts for income taxes in accordance with the Income Taxes Topic of the Financial Accounting Standards Codification. These standards establish financial accounting and reporting standards for the effects of income taxes that result from an enterprise's activities during the current and preceding years. The Company takes an asset and liability approach for financial accounting and reporting of income taxes. The Company pays income taxes in many foreign jurisdictions based on the profits realized in those jurisdictions, which can be significantly impacted by terms of intercompany transactions between the Company and its foreign affiliates. Deferred tax assets and liabilities are created in this process. The Company has netted these deferred tax assets and deferred tax liabilities by jurisdiction. Valuation allowances are established when necessary to reduce deferred tax assets to the amounts expected to be ultimately realized. As of September 30, 2015 and December 31, 2014, the Company had net deferred tax assets of $27.1 million and $40.0 million, respectively. NU SKIN ENTERPRISES, INC. Notes to Consolidated Financial Statements The Company evaluates its indefinite reinvestment assertions with respect to foreign earnings each quarter. Other than earnings the Company intends to reinvest indefinitely, the Company accrues for the U.S. federal and state income taxes applicable to the earnings. For all foreign earnings, the Company accrues the applicable foreign income taxes. Undistributed earnings that the Company has indefinitely reinvested, for which no federal or state income taxes in the U.S. have been provided, aggregate to $50.0 million as of December 31, 2014 and September 30, 2015. The company anticipates indefinitely reinvesting an additional $20.0 million for the year ended December 31, 2015. If the amount designated as indefinitely reinvested as of December 31, 2014 was repatriated to the United States, the amount of incremental taxes would be approximately $5.3 million. |
UNCERTAIN TAX POSITIONS
UNCERTAIN TAX POSITIONS | 9 Months Ended |
Sep. 30, 2015 | |
UNCERTAIN TAX POSITIONS [Abstract] | |
UNCERTAIN TAX POSITIONS | 8. UNCERTAIN TAX POSITIONS The Company files income tax returns in the U.S. federal jurisdiction, and in various state and foreign jurisdictions. The Company has filed U.S. federal tax returns for all years through and including 2014, and is no longer subject to tax examinations from the United States Internal Revenue Service (the "IRS") for any of these years except for 2011. With a few exceptions, the Company is no longer subject to state and local income tax examination by tax authorities for the years before 2011. In 2009, the Company entered into a voluntary program with the IRS called Compliance Assurance Process ("CAP"). The objective of CAP is to contemporaneously work with the IRS to achieve federal tax compliance and resolve all or most of the issues prior to filing of the tax return. The Company has elected to participate in the CAP program for 2016 and may elect to continue participating in CAP for future tax years; the Company may withdraw from the program at any time. In major foreign jurisdictions, the Company is no longer subject to income tax examinations for years before 2009. However, statutes in certain countries may be as long as ten years for transfer pricing related issues. Along with the IRS examination of 2011, the Company is currently under examination in certain foreign jurisdictions; however, the outcomes of those reviews are not yet determinable. The Company's unrecognized tax benefits relate to multiple foreign and domestic jurisdictions. Due to potential increases in unrecognized tax benefits from the multiple jurisdictions in which the Company operates, as well as the expiration of various statutes of limitation, it is reasonably possible that the Company's gross unrecognized tax benefits, net of foreign currency adjustments, may increase within the next 12 months by a range of approximately $0.1 million to $1.0 million. |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 9 Months Ended |
Sep. 30, 2015 | |
COMMITMENTS AND CONTINGENCIES [Abstract] | |
COMMITMENTS AND CONTINGENCIES | 9. COMMITMENTS AND CONTINGENCIES The Company is subject to government regulations pertaining to product formulation, labeling and packaging, product claims and advertising, and the Company's direct selling system. The Company is also subject to the jurisdiction of numerous foreign tax and customs authorities. Any assertions or determination that either the Company or the Company's sales force is not in compliance with existing statutes, laws, rules or regulations could have a material adverse effect on the Company's operations. In addition, in any country or jurisdiction, the adoption of new statutes, laws, rules or regulations or changes in the interpretation of existing statutes, laws, rules or regulations could have a material adverse effect on the Company and its operations. Although management believes that the Company is in compliance in all material respects with the statutes, laws, rules and regulations of every jurisdiction in which it operates, no assurance can be given that the Company's compliance with applicable statutes, laws, rules and regulations will not be challenged by foreign authorities or that such challenges will not have a material adverse effect on the Company's financial position or results of operations or cash flows. The Company and its Subsidiaries are defendants in litigation and proceedings involving various matters. Except as noted below, in the opinion of the Company's management, based upon advice of its counsel handling such litigation and proceedings, adverse outcomes, if any, will not likely result in a material effect on the Company's consolidated financial condition, results of operations or cash flows . NU SKIN ENTERPRISES, INC. Notes to Consolidated Financial Statements The Company is subject to regular audits by federal, state and foreign tax authorities. These audits may result in additional tax liabilities. The Company believes it has appropriately provided for income taxes for all years. Several factors drive the calculation of its tax reserves. Some of these factors include: (i) the expiration of various statutes of limitations; (ii) changes in tax law and regulations; (iii) issuance of tax rulings; and (iv) settlements with tax authorities. Changes in any of these factors may result in adjustments to the Company's reserves, which would impact its reported financial results. The Company is currently involved in a dispute related to customs assessments by Yokohama Customs on several of the Company's products for the period of October 2006 through September 2009 in connection with post-importation audits, as well as the disputed portion of the Company's import duties from October 2009 to the present, which the Company has or will hold in bond or pay under protest (the Company was previously required to post a bond or make a deposit to secure any additional duties that may have been due and payable on current imports, but it is no longer required to do so). Additional assessments related to any prior period are barred by applicable statutes of limitations. The aggregate amount of these assessments and disputed duties was approximately 4.4 billion Japanese yen as of September 30, 2015 (approximately $37.0 million), net of recovery of consumption taxes. The issue in this case is whether a United States entity utilizing a commissionaire agent in Japan to import its products can use the manufacturer's invoice pursuant to the transaction value method under the World Trade Organization Customs Valuation Agreement or whether it must use one of the alternative valuation methods provided in that agreement, and, if an alternative method must be used, what the allowable deductions would be in determining the proper valuation. Following the Company's review of the assessments and after consulting with the Company's legal and customs advisors, the Company believes that use of the manufacturer's invoice is the appropriate valuation method and that the additional assessments are improper and are not supported by applicable customs laws because they are based on an alternative valuation method. Because the Company believes that the assessment of higher duties by the customs authorities is an improper application of the regulations, the Company is currently expensing the portion of the duties the Company believes is supported under applicable customs law, and recording the additional deposit or payment as a receivable within long-term assets on its consolidated financial statements. The Company filed letters of protest with the applicable Customs authorities, which were rejected. The Company then appealed the matter to the Ministry of Finance in Japan. In the second quarter of 2011, the Ministry of Finance in Japan denied the Company's administrative appeal. The Company disagrees with the Ministry of Finance's administrative decision. The Company is now pursuing the matter in Tokyo District Court, which is not required to give deference to the decision made by the Ministry of Finance and which the Company believes will provide a more independent determination of the matter. In June 2015, the Tokyo District Court closed the proceedings, and we currently anticipate a decision on the matter sometime this year. If the Company is unsuccessful in recovering the amounts assessed and paid, the Company will record a non-cash expense for the full amount of the disputed assessments. The Company anticipates that additional disputed duties will be limited going forward as the Company purchases a majority of the affected products in Japan from a Japanese company that purchases and imports the products from the manufacturers. The Company is also currently being sued in a purported class action lawsuit and derivative claim relating to negative media and regulatory scrutiny regarding the Company's business in Mainland China and the associated decline in the Company's stock price. Beginning in January 2014, six purported class action complaints were filed in the United States District Court for the District of Utah. On May 1, 2014, the court consolidated the various purported class actions, appointed State-Boston Retirement System as lead plaintiff in the consolidated action and appointed the law firm Labaton Sucharow as lead counsel for the purported class in the consolidated action. On June 30, 2014, a consolidated class action complaint was filed. On February 26, 2015, the court denied the Company's motion to dismiss the case. The consolidated class action complaint purports to assert claims on behalf of certain of the Company's stockholders under Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder against Nu Skin Enterprises, Ritch N. Wood, and M. Truman Hunt and to assert claims under Section 20(a) of the Securities Exchange Act of 1934 against Messrs. Wood and Hunt. The consolidated class action complaint alleges that, inter alia, the Company made materially false and misleading statements regarding its sales operations in and financial results derived from Mainland China, including purportedly operating a pyramid scheme based on illegal multi-level marketing activities. The Company believes that the claims asserted in the consolidated class action complaint are without merit and intends to vigorously defend itself. NU SKIN ENTERPRISES, INC. Notes to Consolidated Financial Statements In addition, beginning in February 2014, five purported shareholder derivative complaints were filed in the United States District Court for the District of Utah. On May 1, 2014, the court issued an order consolidating the derivative actions, appointing plaintiffs Amos. C. Acoff and Analisa Suderov as co-lead plaintiffs in the consolidated action, and appointing the law firms Bernstein Litowitz Berger & Grossmann LLP and The Weiser Law Firm, P.C. as co-lead counsel for the plaintiffs in the consolidated action. On July 25, 2014, a consolidated derivative complaint was filed. On July 17, 2015, the court stayed the derivative action pending a resolution in the securities class action lawsuit and denied the Company's motion to dismiss without prejudice to renewing the motion when the stay is lifted. The consolidated derivative complaint purports to assert claims on behalf of Nu Skin Enterprises, Inc. for, inter alia, breach of fiduciary duties for disseminating false and misleading information, failing to maintain adequate internal controls, unjust enrichment, abuse of control, and gross mismanagement against M. Truman Hunt, Ritch N. Wood, Steven J. Lund, Nevin N. Andersen, Neil H. Offen, Daniel W. Campbell, Andrew W. Lipman, Patricia A. Negrón, Thomas R. Pisano, and nominally against Nu Skin Enterprises, Inc. The consolidated derivative complaint also purports to assert claims on behalf of Nu Skin Enterprises, Inc. for breach of fiduciary duty for insider selling and misappropriation of information against Messrs. Wood, Lund and Campbell. The consolidated derivative complaint alleges that, inter alia, the defendants allowed materially false and misleading statements to be made regarding their sales operations in and financial results derived from Mainland China, including purportedly operating a pyramid scheme based on illegal multi-level marketing activities, and that certain defendants sold common stock on the basis of material, adverse non-public information. The purported class action lawsuit and derivative claim, or others filed alleging similar facts, could result in monetary or other penalties that may materially affect the Company's operating results and financial condition. At this stage of the proceedings, the Company is unable to make an estimate of the potential loss, if any, arising from these matters. |
DEBT
DEBT | 9 Months Ended |
Sep. 30, 2015 | |
DEBT [Abstract] | |
DEBT | 10. DEBT The following table summarizes the Company's debt facilities as of September 30, 2015. The Company's book value for both the individual and consolidated debt included in the table approximates fair value. The estimated fair value of its debt is based on interest rates available for debt with similar terms and remaining maturities. The Company has classified these instruments as Level 2 in the fair value hierarchy. Facility or Arrangement Original Principal Amount Balance as of December 31, 2014 Balance as of September 30, 2015 (1)(2) Interest Rate Repayment terms Credit Agreement term loan facility: U.S. dollar denominated: $127.5 million $125.9 million $121.1 million Variable 30 day: 2.447% One half of the principal amount payable in increasing quarterly installments over a five-year period that began on December 31, 2014, with the remainder payable at the end of the five-year term. Japanese yen denominated: 6.6 billion yen 6.5 billion yen ($54.4 million as of December 31, 2014) 6.3 billion yen ($52.3 million as of September 30, 2015) Variable 30 day: 2.305% One half of the principal amount payable in increasing quarterly installments over a five-year period that began on December 31, 2014, with the remainder payable at the end of the five-year term. Credit Agreement revolving credit facility: $72.5 million $47.5 million Variable 30 day: 2.447% Revolving line of credit expires October 2019. Korea subsidiary loan: $20.0 million ─ $20.0 million 1.12% One half of the principal amount payable on March 17, 2017 and the remainder payable on March 16, 2018. Japan subsidiary loan: 2.0 billion yen ─ 2.0 billion yen ($16.7 million as of September 30, 2015) 0.66% Payable in semi-annual installments over three years beginning January 31, 2016. (1) As of September 30, 2015, the current portion of the Company's debt (i.e. becoming due in the next 12 months) included $57.1 million of the balance of its U.S. dollar-denominated debt under the Credit Agreement term loan facility, $4.1 million of the balance of its Japanese yen-denominated debt under the Credit Agreement term loan facility and $5.5 million of the Japan subsidiary loan. The Company has classified the amount borrowed under the Credit Agreement revolving credit facility as short term because it is the Company's intention to use this line of credit to borrow and pay back funds over short periods of time. (2) The carrying value of the debt reflects the amounts stated in the above table less debt financing costs of $4.6 million, which are not reflected in this table. |
ACCOUNTING PRONOUNCEMENTS
ACCOUNTING PRONOUNCEMENTS | 9 Months Ended |
Sep. 30, 2015 | |
ACCOUNTING PRONOUNCEMENTS [Abstract] | |
ACCOUNTING PRONOUNCEMENTS | 11. ACCOUNTING PRONOUNCEMENTS In April 2014, the FASB issued ASU No. 2014-08, Presentation of Financial Statements (Topic 205) and Property, Plant, and Equipment (Topic 360): Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity. In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers (Topic 606) In June 2014, the FASB issued ASU No. 2014-12, Compensation—Stock Compensation (Topic 718): Accounting for Share-Based Payments When the Terms of an Award Provide That a Performance Target Could Be Achieved after the Requisite Service Period (a consensus of the FASB Emerging Issues Task Force) In August 2014, the FASB issued ASU No. 2014-15, Presentation of Financial Statements — Going Concern (Subtopic 205-40). NU SKIN ENTERPRISES, INC. Notes to Consolidated Financial Statements In April 2015, the FASB issued ASU 2015-03, Simplifying the Presentation of Debt Issuance Costs, Interest – Imputations of Interest, In July 2015, the FASB issued ASU 2015-11, Simplifying the Measurement of Inventory - Inventory (Topic 330). |
VENEZUELA HIGHLY INFLATIONARY A
VENEZUELA HIGHLY INFLATIONARY ACCOUNTING | 9 Months Ended |
Sep. 30, 2015 | |
VENEZUELA HIGHLY INFLATIONARY ACCOUNTING [Abstract] | |
VENEZUELA HIGHLY INFLATIONARY ACCOUNTING | 12. VENEZUELA HIGHLY INFLATIONARY ACCOUNTING The Company commenced operations in Venezuela in 2007, where it markets a variety of personal care and nutritional products. Total assets in Venezuela as of September 30, 2015 and December 31, 2014 are $8.2 million and $14.6 million, of which $3.2 million and $8.2 million are monetary assets in each year respectively. The Venezuela subsidiary also had a $32.8 million and $34.8 million intercompany balance to its parent company as of September 30, 2015 and December 31, 2014, with respect to charges for inventory, commissions, license fees and service fees. The Company imports all of its products into Venezuela from the United States. Venezuela represents a very small portion of the Company's overall business with sales during 2012, 2013 and 2014 representing approximately 0.7%, 1.1% and 1.0% of the Company's overall revenue, respectively. Since November of 2009, Venezuela has been considered a highly inflationary economy. A country is considered to have a highly inflationary economy if it has a cumulative inflation rate of approximately 100% or more over a three-year period as well as other qualitative factors including historic inflation rate trends (increasing and decreasing), the capital intensiveness of the operation and other pertinent economic factors. The functional currency in highly inflationary economies is required to be the functional currency of the entity's parent company (which for our Venezuela subsidiary is the U.S. dollar), and transactions denominated in the local currency are remeasured to the functional currency. The remeasurement of bolivars into U.S. dollars creates foreign currency transaction gains or losses, which the Company includes in its consolidated statement of income. The Venezuela subsidiary did not transition to highly inflationary status until the first quarter of 2014. As a result, the Company continued to account for the Venezuela subsidiary as a bolivar functional currency entity, rather than a U.S. dollar functional currency entity. In the first quarter of 2014, the Company began to account for this subsidiary as highly inflationary, and therefore changed the functional currency of the entity to the U.S. dollar. The consolidated statement of income for the quarter ended March 31, 2014, included an out-of-period adjustment of $6.3 million to correct this error as it was not deemed to be material to the current- or prior-period financial statements. NU SKIN ENTERPRISES, INC. Notes to Consolidated Financial Statements The current operating environment in Venezuela continues to be challenging, with high inflation in the country, government restrictions on foreign exchange and pricing controls, and the possibility of the government announcing further devaluations to its currency. Currency restrictions enacted by the Venezuelan government have impacted the ability of the Company to exchange foreign currency at the official rate to pay for imported products, license fees, commissions and other service fees. T During the first quarter of 2014, two new foreign exchange mechanisms ("SICAD I" and "SICAD II") became available in Venezuela. As of March 31, 2014, the Company determined it would be most appropriate for it to utilize the SICAD I rate, which was approximately 10.7 bolivars per U.S. dollar. As a result of the adoption of this rate during the period ended March 31, 2014, the Company recorded a $14.7 million charge in Other Income (Expense) to reflect foreign currency transaction losses on its net monetary assets denominated in bolivar, which was reflected in the quarter ended March 31, 2014. As of June 30, 2014, the Company determined that it would be most appropriate for it to utilize the SICAD II rate, which was approximately 50 bolivars per U.S. dollar, as the Company had not been successful in getting approval under SICAD I and believed the SICAD II rate better reflects the rate at which the Company will be able to convert bolivars to U.S. dollars. As a result of the adoption of this rate during the three months ended June 30, 2014, the Company recorded an additional $25.3 million charge in Other Income (Expense) to reflect additional foreign currency translation losses on its net monetary assets denominated in bolivar, which was reflected in the year ended December 31, 2014. In the first quarter of 2015 , Venezuela announced that it merged its SICAD I and SICAD II mechanisms into a single mechanism ("SICAD"), and it announced a new foreign exchange mechanism ("SIMADI"), which utilizes a variable exchange rate that was approximately 193 bolivars per U.S. dollar as of March 31, 2015. During the first quarter, the Company determined it would be most appropriate to utilize the SIMADI rate. The remeasurement of the Company's net monetary assets and liabilities denominated in bolivars as a result of this change resulted in a foreign currency exchange loss of $10.2 million during the first quarter of 2015. |
LEASE AND FINANCING OBLIGATIONS
LEASE AND FINANCING OBLIGATIONS | 9 Months Ended |
Sep. 30, 2015 | |
LEASE AND FINANCING OBLIGATIONS [Abstract] | |
LEASE AND FINANCING OBLIGATIONS | 13. LEASE AND FINANCING OBLIGATIONS In 2014, the Company's subsidiary in South Korea entered into a lease agreement with a third-party landlord for office buildings. In April 2015, the Company and the landlord entered into a new lease agreement on terms generally consistent with the 2014 lease. As part of the lease, the landlord agreed to renovate an existing building (the "Existing Building") and construct a new building (the "New Building") adjacent to the Existing Building. The Company accounts for its lease of the Existing Building as an operating lease. As an inducement to enter into the lease, the landlord agreed to make certain improvements on behalf of the Company to the Existing Building. The improvements have been accounted for by the Company as a tenant incentive. NU SKIN ENTERPRISES, INC. Notes to Consolidated Financial Statements The Company has concluded that it is the deemed owner (for accounting purposes only) of the New Building during the construction period under build-to-suit lease accounting. At September 30, 2015, the Company had recognized $20.1 million as the value of the New Building offset by accumulated depreciation of $0.2 million. The Company also booked a corresponding financing obligation in the amount of $10.7 million, net of a $9.3 million deposit paid directly to the landlord, as part of Other liabilities in its consolidated balance sheets. The Company does not expect to recognize any additional project costs associated with the construction of the New Building or any additional financing obligation. The Company had also recognized a $5.9 million tenant incentive asset and deferred tenant incentive liability associated with the Existing Building at September 30, 2015. |
ADJUSTMENT TO INVENTORY
ADJUSTMENT TO INVENTORY | 9 Months Ended |
Sep. 30, 2015 | |
ADJUSTMENT TO INVENTORY [Abstract] | |
ADJUSTMENT TO INVENTORY | 14. ADJUSTMENTS TO INVENTORY During the second quarter of 2014, the Company made a determination to adjust its inventory carrying value. Heightened media and regulatory scrutiny in Mainland China in the first part of 2014, and the voluntary actions the Company took in response to such scrutiny, had a negative impact on the size of the Company's limited-time offer in June 2014, which significantly reduced its expectations for plans to sell our ageLOC TR90 During the third quarter of 2015, the Company made a determination to further adjust its inventory carrying value. A sequential decrease in revenue for the third quarter of 2015, together with a decision not to continue discounted product promotions in the Greater China region to focus Sales Leaders on the launch of our ageLOC Me Total adjustments to the Company's inventory carrying value as of September 30, 2015 and December 31, 2014 were $65.0 million and $56.0 million, respectively. |
ADDITIONAL QUARTERLY DISCLOSURE
ADDITIONAL QUARTERLY DISCLOSURES | 9 Months Ended |
Sep. 30, 2015 | |
ADDITIONAL QUARTERLY DISCLOSURES [Abstract] | |
ADDITIONAL QUARTERLY DISCLOSURES | 15. ADDITIONAL QUARTERLY DISCLOSURES Inventory Inventories consist of the following (U.S. dollars in thousands): September 30, 2015 December 31, 2014 Raw materials $ 132,808 $ 101,479 Finished goods 127,656 237,012 $ 260,464 $ 338,491 NU SKIN ENTERPRISES, INC. Notes to Consolidated Financial Statements Fair Value The following tables present the fair value hierarchy for those assets and liabilities measured at fair value on a recurring basis (U.S. dollars in thousands): Fair Value at September 30, 2015 Level 1 Level 2 Level 3 Total Financial assets (liabilities): Cash equivalents and current investments $ 53,043 $ ─ $ ─ $ 53,043 Forward contracts ─ (83 ) ─ (83 ) Life insurance contracts ─ ─ 26,713 26,713 Total $ 53,043 $ (83 ) $ 26,713 $ 79,673 Fair Value at December 31, 2014 Level 1 Level 2 Level 3 Total Financial assets (liabilities): Cash equivalents and current investments $ 86,574 $ ─ $ ─ $ 86,574 Forward contracts ─ 1,661 ─ 1,661 Life insurance contracts ─ ─ 26,280 26,280 Total $ 86,574 $ 1,661 $ 26,280 $ 114,515 The following table provides a summary of changes in fair value of the Company's Level 3 marketable securities (U.S. dollars in thousands): Life Insurance Contracts Beginning balance at January 1, 2015 $ 26,280 Actual return on plan assets: Relating to assets still held at the reporting date (1,475 ) Purchases and issuances 2,282 Sales and settlements (374 ) Transfers into Level 3 ─ Ending balance at September 30, 2015 $ 26,713 |
SEGMENT INFORMATION (Tables)
SEGMENT INFORMATION (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
SEGMENT INFORMATION [Abstract] | |
Revenue by Region | Revenue generated in each of these regions is set forth below (U.S. dollars in thousands): Three Months Ended Nine Months Ended September 30, September 30, Revenue: 2015 2014 2015 2014 Greater China $ 188,669 $ 226,744 $ 576,172 $ 735,542 North Asia 167,748 205,488 512,757 596,944 South Asia/Pacific 108,857 88,915 247,697 241,762 Americas 70,775 76,737 234,115 246,557 EMEA 35,259 40,916 104,108 139,083 Totals $ 571,308 $ 638,800 $ 1,674,849 $ 1,959,888 |
Revenue by Product Lines | Revenue generated by each of the Company's product lines is set forth below (U.S. dollars in thousands): Three Months Ended Nine Months Ended September 30, September 30, Revenue: 2015 2014 2015 2014 Nu Skin $ 324,115 $ 392,513 $ 1,018,317 $ 1,186,592 Pharmanex 245,569 244,690 652,345 768,178 Other 1,624 1,597 4,187 5,118 Totals $ 571,308 $ 638,800 $ 1,674,849 $ 1,959,888 |
Revenue and Long-Lived Assets by Significant Geographic Areas | Additional information as to the Company's operations in its most significant geographic areas is set forth below (U.S. dollars in thousands): Three Months Ended Nine Months Ended September 30, September 30, Revenue: 2015 2014 2015 2014 Mainland China $ 138,050 $ 152,983 $ 421,498 $ 518,995 South Korea 104,012 127,094 321,812 359,891 Japan 63,736 78,394 190,945 237,053 United States 52,720 54,241 170,288 170,119 Long-lived assets: September 30, 2015 December 31, 2014 Mainland China $ 112,915 $ 103,445 South Korea 48,977 46,626 Japan 14,404 13,768 United States 272,034 287,103 |
DEBT (Tables)
DEBT (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
DEBT [Abstract] | |
Debt Facilities | The following table summarizes the Company's debt facilities as of September 30, 2015. The Company's book value for both the individual and consolidated debt included in the table approximates fair value. The estimated fair value of its debt is based on interest rates available for debt with similar terms and remaining maturities. The Company has classified these instruments as Level 2 in the fair value hierarchy. Facility or Arrangement Original Principal Amount Balance as of December 31, 2014 Balance as of September 30, 2015 (1)(2) Interest Rate Repayment terms Credit Agreement term loan facility: U.S. dollar denominated: $127.5 million $125.9 million $121.1 million Variable 30 day: 2.447% One half of the principal amount payable in increasing quarterly installments over a five-year period that began on December 31, 2014, with the remainder payable at the end of the five-year term. Japanese yen denominated: 6.6 billion yen 6.5 billion yen ($54.4 million as of December 31, 2014) 6.3 billion yen ($52.3 million as of September 30, 2015) Variable 30 day: 2.305% One half of the principal amount payable in increasing quarterly installments over a five-year period that began on December 31, 2014, with the remainder payable at the end of the five-year term. Credit Agreement revolving credit facility: $72.5 million $47.5 million Variable 30 day: 2.447% Revolving line of credit expires October 2019. Korea subsidiary loan: $20.0 million ─ $20.0 million 1.12% One half of the principal amount payable on March 17, 2017 and the remainder payable on March 16, 2018. Japan subsidiary loan: 2.0 billion yen ─ 2.0 billion yen ($16.7 million as of September 30, 2015) 0.66% Payable in semi-annual installments over three years beginning January 31, 2016. (1) As of September 30, 2015, the current portion of the Company's debt (i.e. becoming due in the next 12 months) included $57.1 million of the balance of its U.S. dollar-denominated debt under the Credit Agreement term loan facility, $4.1 million of the balance of its Japanese yen-denominated debt under the Credit Agreement term loan facility and $5.5 million of the Japan subsidiary loan. The Company has classified the amount borrowed under the Credit Agreement revolving credit facility as short term because it is the Company's intention to use this line of credit to borrow and pay back funds over short periods of time. (2) The carrying value of the debt reflects the amounts stated in the above table less debt financing costs of $4.6 million, which are not reflected in this table. |
ADDITIONAL QUARTERLY DISCLOSU25
ADDITIONAL QUARTERLY DISCLOSURES (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
ADDITIONAL QUARTERLY DISCLOSURES [Abstract] | |
Inventories | Inventories consist of the following (U.S. dollars in thousands): September 30, 2015 December 31, 2014 Raw materials $ 132,808 $ 101,479 Finished goods 127,656 237,012 $ 260,464 $ 338,491 |
Assets and Liabilities Measured at Fair Value on a Recurring Basis | The following tables present the fair value hierarchy for those assets and liabilities measured at fair value on a recurring basis (U.S. dollars in thousands): Fair Value at September 30, 2015 Level 1 Level 2 Level 3 Total Financial assets (liabilities): Cash equivalents and current investments $ 53,043 $ ─ $ ─ $ 53,043 Forward contracts ─ (83 ) ─ (83 ) Life insurance contracts ─ ─ 26,713 26,713 Total $ 53,043 $ (83 ) $ 26,713 $ 79,673 Fair Value at December 31, 2014 Level 1 Level 2 Level 3 Total Financial assets (liabilities): Cash equivalents and current investments $ 86,574 $ ─ $ ─ $ 86,574 Forward contracts ─ 1,661 ─ 1,661 Life insurance contracts ─ ─ 26,280 26,280 Total $ 86,574 $ 1,661 $ 26,280 $ 114,515 |
Changes in Fair Value of Marketable Securities | The following table provides a summary of changes in fair value of the Company's Level 3 marketable securities (U.S. dollars in thousands): Life Insurance Contracts Beginning balance at January 1, 2015 $ 26,280 Actual return on plan assets: Relating to assets still held at the reporting date (1,475 ) Purchases and issuances 2,282 Sales and settlements (374 ) Transfers into Level 3 ─ Ending balance at September 30, 2015 $ 26,713 |
THE COMPANY (Details)
THE COMPANY (Details) | 9 Months Ended |
Sep. 30, 2015Region | |
THE COMPANY [Abstract] | |
Number of geographic regions | 5 |
NET INCOME PER SHARE (Details)
NET INCOME PER SHARE (Details) - shares shares in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | |
NET INCOME PER SHARE [Abstract] | ||||
Other shares excluded from the calculation of diluted earnings per share (in shares) | 1.6 | 2.8 | 1.6 | 2.1 |
DIVIDENDS PER SHARE (Details)
DIVIDENDS PER SHARE (Details) - USD ($) $ / shares in Units, $ in Thousands | Sep. 16, 2015 | Jun. 10, 2015 | Mar. 18, 2015 | Sep. 30, 2014 | Mar. 31, 2014 | Sep. 30, 2015 | Sep. 30, 2014 |
Dividends per Share [Abstract] | |||||||
Date declared | 2015-01 | 2015-01 | |||||
Payment of cash dividends | $ 20,700 | $ 61,382 | $ 60,964 | ||||
Date paid | Mar. 18, 2015 | ||||||
Date of record | Feb. 27, 2015 | ||||||
Dividend Declared 2015-Q1 [Member] | |||||||
Dividends per Share [Abstract] | |||||||
Date declared | 2015-04 | 2015-04 | |||||
Cash dividend declared (in dollars per share) | $ 0.350 | ||||||
Payment of cash dividends | $ 20,500 | ||||||
Date paid | Jun. 10, 2015 | ||||||
Date of record | May 22, 2015 | ||||||
Dividend Declared 2015-Q2 [Member] | |||||||
Dividends per Share [Abstract] | |||||||
Date declared | 2015-09 | ||||||
Cash dividend declared (in dollars per share) | $ 0.350 | ||||||
Payment of cash dividends | $ 20,200 | ||||||
Date paid | Sep. 16, 2015 | ||||||
Date of record | Aug. 28, 2015 | ||||||
Dividend Declared 2015-Q3 [Member] | |||||||
Dividends per Share [Abstract] | |||||||
Date declared | 2015-10 | ||||||
Cash dividend declared (in dollars per share) | $ 0.350 | $ 0.350 | |||||
Date paid | Oct. 9, 2015 | ||||||
Date of record | Nov. 20, 2015 |
DERIVATIVE FINANCIAL INSTRUME29
DERIVATIVE FINANCIAL INSTRUMENTS (Details) $ in Thousands, € in Millions, ¥ in Millions | 3 Months Ended | 9 Months Ended | |||||||||
Sep. 30, 2015USD ($) | Sep. 30, 2014USD ($) | Sep. 30, 2015USD ($) | Sep. 30, 2014USD ($) | Sep. 30, 2015EUR (€) | Sep. 30, 2015JPY (¥) | Dec. 31, 2014USD ($) | Sep. 30, 2014EUR (€) | Sep. 30, 2014JPY (¥) | Dec. 31, 2013USD ($) | Sep. 30, 2013USD ($) | |
Derivative Financial Instruments [Abstract] | |||||||||||
Revenue | $ 571,308 | $ 638,800 | $ 1,674,849 | $ 1,959,888 | |||||||
Derivative Financial Instruments [Abstract] | |||||||||||
Accumulated other comprehensive income (loss) | (73,000) | (73,000) | $ (51,521) | ||||||||
Deferred tax assets | 27,100 | 27,100 | $ 40,000 | ||||||||
Accumulated Unrealized Gains (Losses) on Foreign Currency Cash Flow Hedges [Member] | |||||||||||
Derivative Financial Instruments [Abstract] | |||||||||||
Accumulated other comprehensive income (loss) | 100 | 100 | 1,100 | ||||||||
Accumulated Unrealized Gains (Losses) on Foreign Currency Cash Flow Hedges [Member] | Reclassification out of Accumulated Other Comprehensive Income [Member] | |||||||||||
Derivative Financial Instruments [Abstract] | |||||||||||
Revenue | 0 | 800 | 2,100 | 1,500 | |||||||
Accumulated Translation Adjustment [Member] | |||||||||||
Derivative Financial Instruments [Abstract] | |||||||||||
Accumulated other comprehensive income (loss) | (72,900) | (72,900) | $ (52,600) | ||||||||
Forward Contracts [Member] | Cash Flow Hedges [Member] | Japanese Yen [Member] | |||||||||||
Derivative Financial Instruments [Abstract] | |||||||||||
Notional amount | 16,700 | $ 7,300 | 16,700 | $ 7,300 | ¥ 2,000 | ¥ 800 | |||||
Forward Contracts [Member] | Cash Flow Hedges [Member] | Euros [Member] | |||||||||||
Derivative Financial Instruments [Abstract] | |||||||||||
Notional amount | $ 16,800 | $ 16,800 | € 15 | € 7 | $ 8,800 |
REPURCHASES OF COMMON STOCK (De
REPURCHASES OF COMMON STOCK (Details) - USD ($) $ in Thousands, shares in Millions | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | Oct. 30, 2015 | |
Repurchases of Common Stock [Abstract] | |||||
Common stock repurchased (in shares) | 0.6 | 0 | 2.1 | 0.3 | |
Common stock repurchased | $ 28,200 | $ 0 | $ 104,100 | $ 25,000 | |
Available for repurchase under the repurchase program | $ 244,800 | $ 244,800 | $ 500,000 |
SEGMENT INFORMATION (Details)
SEGMENT INFORMATION (Details) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2015USD ($) | Sep. 30, 2014USD ($) | Sep. 30, 2015USD ($)RegionProductLine | Sep. 30, 2014USD ($) | Dec. 31, 2014USD ($) | |
SEGMENT INFORMATION [Abstract] | |||||
Number of geographic regions | Region | 5 | ||||
Number of product lines | ProductLine | 3 | ||||
Segment Information [Abstract] | |||||
Revenue | $ 571,308 | $ 638,800 | $ 1,674,849 | $ 1,959,888 | |
Nu Skin [Member] | |||||
Segment Information [Abstract] | |||||
Revenue | 324,115 | 392,513 | 1,018,317 | 1,186,592 | |
Pharmanex [Member] | |||||
Segment Information [Abstract] | |||||
Revenue | 245,569 | 244,690 | 652,345 | 768,178 | |
Other Product Lines [Member] | |||||
Segment Information [Abstract] | |||||
Revenue | 1,624 | 1,597 | 4,187 | 5,118 | |
Greater China [Member] | |||||
Segment Information [Abstract] | |||||
Revenue | 188,669 | 226,744 | 576,172 | 735,542 | |
North Asia [Member] | |||||
Segment Information [Abstract] | |||||
Revenue | 167,748 | 205,488 | 512,757 | 596,944 | |
Americas [Member] | |||||
Segment Information [Abstract] | |||||
Revenue | 70,775 | 76,737 | 234,115 | 246,557 | |
South Asia/Pacific [Member] | |||||
Segment Information [Abstract] | |||||
Revenue | 108,857 | 88,915 | 247,697 | 241,762 | |
EMEA [Member] | |||||
Segment Information [Abstract] | |||||
Revenue | 35,259 | 40,916 | 104,108 | 139,083 | |
Japan [Member] | |||||
Segment Information [Abstract] | |||||
Revenue | 63,736 | 78,394 | 190,945 | 237,053 | |
Long-lived assets | 14,404 | 14,404 | $ 13,768 | ||
Mainland China [Member] | |||||
Segment Information [Abstract] | |||||
Revenue | 138,050 | 152,983 | 421,498 | 518,995 | |
Long-lived assets | 112,915 | 112,915 | 103,445 | ||
South Korea [Member] | |||||
Segment Information [Abstract] | |||||
Revenue | 104,012 | 127,094 | 321,812 | 359,891 | |
Long-lived assets | 48,977 | 48,977 | 46,626 | ||
United States [Member] | |||||
Segment Information [Abstract] | |||||
Revenue | 52,720 | $ 54,241 | 170,288 | $ 170,119 | |
Long-lived assets | $ 272,034 | $ 272,034 | $ 287,103 |
DEFERRED TAX ASSETS AND LIABI32
DEFERRED TAX ASSETS AND LIABILITIES (Details) - USD ($) $ in Millions | Sep. 30, 2015 | Dec. 31, 2014 | Dec. 31, 2013 |
DEFERRED TAX ASSETS AND LIABILITIES [Abstract] | |||
Net deferred tax assets | $ 27.1 | $ 40 | |
Undistributed foreign earnings indefinitely reinvested | 50 | $ 50 | |
Additional undistributed foreign earnings expected to be indefinitely reinvested in 2015 | 20 | ||
Incremental taxes on indefinitely reinvested foreign earnings | $ 5.3 |
UNCERTAIN TAX POSITIONS (Detail
UNCERTAIN TAX POSITIONS (Details) - Operations in Multiple Foreign and Domestic Jurisdictions and Expiration of Various Statutes of Limitation [Member] $ in Millions | Sep. 30, 2015USD ($) |
Minimum [Member] | |
Uncertain Tax Positions [Abstract] | |
Increase in gross unrecognized tax benefits, net of foreign currency adjustments, within the next 12 months | $ 0.1 |
Maximum [Member] | |
Uncertain Tax Positions [Abstract] | |
Increase in gross unrecognized tax benefits, net of foreign currency adjustments, within the next 12 months | $ 1 |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Details) - Sep. 30, 2015 $ in Millions, ¥ in Billions | USD ($) | JPY (¥) |
Dispute Related to Customs Assessments by Yokohama Customs [Member] | ||
Commitments and Contingencies [Abstract] | ||
Estimated assessments and disputed duties | $ 37 | ¥ 4.4 |
DEBT (Details)
DEBT (Details) $ in Thousands, ¥ in Billions | 9 Months Ended | ||||||||
Sep. 30, 2015USD ($) | Sep. 30, 2015JPY (¥) | Jul. 31, 2015USD ($) | Jul. 31, 2015JPY (¥) | Jun. 30, 2015USD ($) | Jun. 30, 2015JPY (¥) | Dec. 31, 2014USD ($) | |||
Debt Facilities [Abstract] | |||||||||
Current portion of long-term debt | $ 66,743 | $ 82,770 | |||||||
Debt discount | 4,600 | ||||||||
Credit Agreement Term Loan Facility U.S. Dollar Denominated [Member] | |||||||||
Debt Facilities [Abstract] | |||||||||
Original principal amount | 127,500 | ||||||||
Balance | $ 121,100 | [1],[2] | $ 125,900 | ||||||
Interest rate | Variable 30 day: 2.447 | ||||||||
Interest rate | 2.447% | 2.447% | |||||||
Repayment terms | One half of the principal amount payable in increasing quarterly installments over a five-year period that began on December 31, 2014, with the remainder payable at the end of the five-year term. | ||||||||
Term | 5 years | ||||||||
Current portion of long-term debt | $ 57,100 | ||||||||
Credit Agreement Term Loan Facility Japanese Yen Denominated [Member] | |||||||||
Debt Facilities [Abstract] | |||||||||
Original principal amount | ¥ | ¥ 6.6 | ||||||||
Balance | $ 52,300 | [1],[2] | ¥ 6.3 | [1],[2] | 54,400 | ¥ 6.5 | |||
Interest rate | Variable 30 day: 2.305 | ||||||||
Interest rate | 2.305% | 2.305% | |||||||
Repayment terms | One half of the principal amount payable in increasing quarterly installments over a five-year period that began on December 31, 2014, with the remainder payable at the end of the five-year term. | ||||||||
Term | 5 years | ||||||||
Current portion of long-term debt | $ 4,100 | ||||||||
Credit Agreement Revolving Credit Facility [Member] | |||||||||
Debt Facilities [Abstract] | |||||||||
Original principal amount | 0 | ||||||||
Balance | $ 47,500 | [1],[2] | 72,500 | ||||||
Interest rate | Variable 30 day: 2.447 | ||||||||
Interest rate | 2.447% | 2.447% | |||||||
Repayment terms | Revolving line of credit expires October 2019. | ||||||||
Korea Subsidiary Loan [Member] | |||||||||
Debt Facilities [Abstract] | |||||||||
Original principal amount | $ 20,000 | ||||||||
Balance | $ 20,000 | [1],[2] | 0 | ||||||
Interest rate | 1.12% | 1.12% | |||||||
Repayment terms | One half of the principal amount payable on March 17, 2017 and the remainder payable on March 16, 2018. | ||||||||
Unsecured Bonds [Member] | |||||||||
Debt Facilities [Abstract] | |||||||||
Original principal amount | ¥ | ¥ 2 | ||||||||
Balance | $ 16,700 | ¥ 2 | $ 0 | ¥ 0 | |||||
Interest rate | 0.66% | 0.66% | |||||||
Repayment terms | Payable in semi-annual installments over three years beginning January 31, 2016. | ||||||||
Term | 3 years | ||||||||
Current portion of long-term debt | $ 5,500 | ||||||||
Nu Skin Japan Co., Ltd. [Member] | Unsecured Bonds [Member] | Subsequent Event [Member] | |||||||||
Debt Facilities [Abstract] | |||||||||
Original principal amount | $ 0 | ¥ 0 | |||||||
Term | 0 years | ||||||||
[1] | As of June 30, 2015, the current portion of the Company's debt (i.e. becoming due in the next 12 months) included $71.3 million of the balance of its U.S. dollar denominated debt under the Credit Agreement term loan facility and $3.7 million of the balance of its Japanese yen-denominated debt under the Credit Agreement term loan facility. The Company has classified the amount borrowed under the Credit Agreement revolving credit facility as short term because it is the Company's intention to use this line of credit to borrow and pay back funds over short periods of time. | ||||||||
[2] | The carrying value of the debt reflects the amounts stated in the above table less debt financing costs of $4.9 million, which are not reflected in this table. |
VENEZUELA HIGHLY INFLATIONARY36
VENEZUELA HIGHLY INFLATIONARY ACCOUNTING (Details) $ in Thousands | 3 Months Ended | 9 Months Ended | 12 Months Ended | |||||
Mar. 31, 2015USD ($)VEB / $ | Jun. 30, 2014USD ($)VEB / $ | Mar. 31, 2014USD ($)VEB / $Mechanism | Sep. 30, 2015USD ($) | Dec. 31, 2014USD ($) | Dec. 31, 2013USD ($) | Dec. 31, 2012 | Sep. 30, 2014USD ($) | |
Venezuela Highly Inflationary Accounting [Abstract] | ||||||||
Total assets | $ 1,553,458 | $ 1,614,434 | ||||||
Monetary assets | $ 305,808 | 288,415 | $ 525,153 | $ 194,944 | ||||
SICAD I [Member] | Other Income (Expense), Net [Member] | ||||||||
Venezuela Highly Inflationary Accounting [Abstract] | ||||||||
Foreign currency transaction losses on net monetary assets and liabilities | $ (25,300) | $ (14,700) | ||||||
SIMADI [Member] | Other Income (Expense), Net [Member] | ||||||||
Venezuela Highly Inflationary Accounting [Abstract] | ||||||||
Foreign currency transaction losses on net monetary assets and liabilities | $ (10,200) | |||||||
Minimum [Member] | ||||||||
Venezuela Highly Inflationary Accounting [Abstract] | ||||||||
Cumulative inflation rate | 100.00% | |||||||
Venezuela [Member] | ||||||||
Venezuela Highly Inflationary Accounting [Abstract] | ||||||||
Total assets | $ 8,200 | 14,600 | ||||||
Monetary assets | 3,200 | $ 8,200 | ||||||
Number of foreign exchange mechanisms | Mechanism | 2 | |||||||
Venezuela [Member] | SICAD I [Member] | ||||||||
Venezuela Highly Inflationary Accounting [Abstract] | ||||||||
Foreign currency exchange rate | VEB / $ | 50 | 10.7 | ||||||
Venezuela [Member] | SIMADI [Member] | ||||||||
Venezuela Highly Inflationary Accounting [Abstract] | ||||||||
Foreign currency exchange rate | VEB / $ | 193 | |||||||
Venezuela [Member] | Sales Revenue [Member] | Geographic Concentration Risk [Member] | ||||||||
Venezuela Highly Inflationary Accounting [Abstract] | ||||||||
Concentration percentage | 1.00% | 1.10% | 0.70% | |||||
Subsidiary in Venezuela [Member] | ||||||||
Venezuela Highly Inflationary Accounting [Abstract] | ||||||||
Payable to parent company | $ 32,800 | $ 34,800 | ||||||
Correct Certain Accounting Errors for Hyper-Inflationary Adjustments with Respect to Operations in Venezuela [Member] | ||||||||
Venezuela Highly Inflationary Accounting [Abstract] | ||||||||
Period used to determine highly inflationary economy | 3 years | |||||||
Out-of-period adjustment to income statement | $ 6,300 |
LEASE AND FINANCING OBLIGATIO37
LEASE AND FINANCING OBLIGATIONS (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2015 | Sep. 30, 2014 | |
New Building [Abstract] | ||
Depreciation | $ 52,101 | $ 38,933 |
Lease Agreement for New Regional Headquarters Building [Member] | ||
New Building [Abstract] | ||
Construction-in-progress | 20,100 | |
Financing obligation related to lease agreement | 10,700 | |
Deposit paid to landlord | 9,300 | |
Deferred tenant incentive liability | 5,900 | |
Depreciation | $ 200 |
ADJUSTMENT TO INVENTORY (Detail
ADJUSTMENT TO INVENTORY (Details) - USD ($) $ in Millions | 9 Months Ended | 12 Months Ended |
Sep. 30, 2015 | Dec. 31, 2014 | |
ADJUSTMENT TO INVENTORY [Abstract] | ||
Write-down of inventory | $ 37.9 | $ 50 |
Total adjustments to inventory carrying value | $ 65 | $ 56 |
ADDITIONAL QUARTERLY DISCLOSU39
ADDITIONAL QUARTERLY DISCLOSURES (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2015 | Dec. 31, 2014 | |
Inventories [Abstract] | ||
Raw materials | $ 132,808 | $ 101,479 |
Finished goods | 127,656 | 237,012 |
Inventories | 260,464 | 338,491 |
Fair Value on a Recurring Basis [Member] | ||
Financial Assets (Liabilities) [Abstract] | ||
Cash equivalents and current investments | 53,043 | 86,574 |
Forward contracts | (83) | 1,661 |
Life insurance contracts | 26,713 | 26,280 |
Total | 79,673 | 114,515 |
Fair Value on a Recurring Basis [Member] | Level 1 [Member] | ||
Financial Assets (Liabilities) [Abstract] | ||
Cash equivalents and current investments | 53,043 | 86,574 |
Forward contracts | 0 | 0 |
Life insurance contracts | 0 | 0 |
Total | 53,043 | 86,574 |
Fair Value on a Recurring Basis [Member] | Level 2 [Member] | ||
Financial Assets (Liabilities) [Abstract] | ||
Cash equivalents and current investments | 0 | 0 |
Forward contracts | (83) | 1,661 |
Life insurance contracts | 0 | 0 |
Total | (83) | 1,661 |
Fair Value on a Recurring Basis [Member] | Level 3 [Member] | ||
Financial Assets (Liabilities) [Abstract] | ||
Cash equivalents and current investments | 0 | 0 |
Forward contracts | 0 | 0 |
Life insurance contracts | 26,713 | 26,280 |
Total | 26,713 | $ 26,280 |
Life Insurance Contracts [Member] | ||
Changes in Fair Value of Marketable Securities [Roll Forward] | ||
Balance, beginning of period | 26,280 | |
Actual Return on Plan Assets [Abstract] | ||
Relating to assets still held at the reporting date | (1,475) | |
Purchases and issuances | 2,282 | |
Sales and settlements | (374) | |
Transfers into Level 3 | 0 | |
Balance, end of period | $ 26,713 |