Exhibit 99
USANA Provides Preliminary Fourth Quarter 2006 Results
Record Fourth Quarter Net Sales and EPS to Exceed Guidance
Company Begins Operations in Malaysia
Minor Reclassification Made to Historical Revenue and Expense Items
SALT LAKE CITY--(BUSINESS WIRE)--Jan. 10, 2007--USANA Health Sciences, Inc.
(NASDAQ:USNA) today provided preliminary financial results for its fourth
quarter ended December 30, 2006. The company currently expects net sales for
this period to be approximately $101 million, before the reclassification as
described below. This exceeds management's prior guidance of $98 million to $100
million. Net sales after the reclassification are expected to be approximately
$99.5 million, which represents the 18th consecutive quarter of record net
sales. Earnings per share for the fourth quarter are expected to exceed
management's previously announced guidance of $0.56 to $0.58. The company now
anticipates that earnings per share will be in the range of $0.58 to $0.60 and
are not affected by the reclassification as described below.
The company also announced today that it has commenced operations in
Malaysia, USANA's 13th global market. The company began accepting new Associate
applications and processing orders for this market on Monday, January 8, 2007.
"We are pleased that we have finished out 2006 with such strong results,
which reflect the hard work and dedication of our Associates as well as the
market's continued enthusiasm for our science-based products," said Dave Wentz,
president of USANA. "Malaysia, one of the top 15 direct selling markets
globally, should provide us with additional growth opportunities."
Revenue Reclassification
The company also announced today that it will make an immaterial
reclassification to its consolidated financial statements beginning with the
fourth quarter of 2006. This reclassification will not affect reported operating
earnings, net earnings, or earnings per share. However, this reclassification
will reduce net sales by approximately 1.5%, offset by a corresponding reduction
in Associate incentive expense. This reclassification will be reflected in the
fourth quarter earnings press release that will be issued in early February
2007.
Previously the company reported a component of its Associate compensation
plan as an Associate incentive expense. Now, however, the company will
reclassify that component as a sales discount. To facilitate comparison of the
company's prior quarters, as well as comparison of that data with the company's
past projections, the company has included in this press release historical
financial tables that include both pre- and post-reclassification data.
Quarterly data has been provided for fiscal years 2004, 2005, and for the
nine-month period ended September 30, 2006.
Updated 2006 Guidance
Giving effect to the reclassification mentioned above, management now
anticipates net sales for the full year 2006 to be approximately $374 million.
Because the reclassification will not affect earnings per share, management
expects earnings per share for the full year 2006 to be in the range of $2.18 to
$2.20, which is above the guidance range that was provided on October 17, 2006.
USANA plans to issue a press release for its final fourth quarter and full
year 2006 results on February 6, 2007, which will incorporate the above noted
reclassification. Executives will hold a conference call with investors on
February 7, 2007 to discuss these results.
About USANA
USANA develops and manufactures high quality nutritionals, personal care,
and weight management products that are sold directly to Preferred Customers and
Associates throughout the United States, Canada, Australia, New Zealand, Hong
Kong, Japan, Taiwan, South Korea, Singapore, Mexico, Malaysia, the Netherlands,
and the United Kingdom. More information on USANA can be found at
http://www.usanahealthsciences.com.
Safe Harbor
This press release contains forward-looking statements within the meaning
of Section 27A of the Securities Act and Section 21E of the Securities Exchange
Act. Actual results could differ materially from those projected in these
forward-looking statements, which involve a number of risks and uncertainties,
including reliance upon our network of independent Associates, the governmental
regulation of our products, manufacturing and marketing risks, and risks
associated with our international expansion. The contents of this release should
be considered in conjunction with the risk factors, warnings, and cautionary
statements that are contained in our most recent filings with the Securities and
Exchange Commission.
USANA Health Sciences, Inc.
Consolidated Statements of Earnings
(In thousands, except per share data)
(unaudited)
Quarter Ended
----------------------------------------------
3-Apr-04 3-Jul-04 2-Oct-04 1-Jan-05 2-Apr-05
-------- -------- -------- -------- --------
As Reclassified
- -----------------------
Net sales $61,030 $66,431 $67,792 $74,098 $75,527
Cost of sales 15,058 16,195 16,732 18,837 18,010
-------- -------- -------- -------- --------
Gross profit 45,972 50,236 51,060 55,261 57,517
Operating expenses
Associate incentives 22,867 24,741 25,329 28,023 28,499
Selling, general and
admini-
strative 13,262 13,656 13,141 14,633 14,849
Research and
development 578 607 450 396 599
-------- -------- -------- -------- --------
Earnings from
operations 9,265 11,232 12,140 12,209 13,570
Other income 149 (1) (513) 598 165
-------- -------- -------- -------- --------
Earnings before
income taxes 9,414 11,231 11,627 12,807 13,735
Income taxes 3,201 3,818 3,631 3,652 4,807
-------- -------- -------- -------- --------
NET EARNINGS $ 6,213 $ 7,413 $ 7,996 $ 9,155 $ 8,928
======== ======== ======== ======== ========
Earnings per share -
diluted $ 0.30 $ 0.36 $ 0.39 $ 0.46 $ 0.45
======== ======== ======== ======== ========
Weighted average
shares outstanding -
diluted 20,853 20,523 20,296 19,990 19,971
======== ======== ======== ======== ========
As Reported
- -----------------------
Net sales $61,775 $67,246 $68,673 $75,130 $76,578
Cost of sales 15,058 16,195 16,732 18,837 18,010
-------- -------- -------- -------- --------
Gross profit 46,717 51,051 51,941 56,293 58,568
Operating expenses
Associate incentives 23,612 25,556 26,210 29,055 29,550
Selling, general and
admini-
strative 13,262 13,656 13,141 14,633 14,849
Research and
development 578 607 450 396 599
-------- -------- -------- -------- --------
Earnings from
operations 9,265 11,232 12,140 12,209 13,570
Other income 149 (1) (513) 598 165
-------- -------- -------- -------- --------
Earnings before
income taxes 9,414 11,231 11,627 12,807 13,735
Income taxes 3,201 3,818 3,631 3,652 4,807
-------- -------- -------- -------- --------
NET EARNINGS $ 6,213 $ 7,413 $ 7,996 $ 9,155 $ 8,928
======== ======== ======== ======== ========
Earnings per share -
diluted $ 0.30 $ 0.36 $ 0.39 $ 0.46 $ 0.45
======== ======== ======== ======== ========
Weighted average
shares outstanding -
diluted 20,853 20,523 20,296 19,990 19,971
======== ======== ======== ======== ========
Quarter Ended
------------------------------------------------------
2-Jul-05 1-Oct-05 31-Dec- 1-Apr-06 1-Jul-06 30-Sep-
05 06
--------- -------- -------- -------- -------- --------
As Reclassified
- ---------------
Net sales $80,878 $81,038 $85,646 $88,229 $92,482 $93,698
Cost of sales 19,499 19,760 20,747 21,338 22,276 22,188
--------- -------- -------- -------- -------- --------
Gross
profit 61,379 61,278 64,899 66,891 70,206 71,510
Operating
expenses
Associate
incentives 30,774 31,358 33,414 34,006 36,025 36,994
Selling,
general and
admini-
strative 15,168 14,756 15,553 17,626 17,991 17,898
Research and
development 689 551 500 732 830 881
--------- -------- -------- -------- -------- --------
Earnings
from
operations 14,748 14,613 15,432 14,527 15,360 15,737
Other income (67) 172 217 295 336 68
--------- -------- -------- -------- -------- --------
Earnings
before
income
taxes 14,681 14,785 15,649 14,822 15,696 15,805
Income taxes 5,138 4,743 5,168 5,262 5,352 5,582
--------- -------- -------- -------- -------- --------
NET EARNINGS $ 9,543 $10,042 $10,481 $ 9,560 $10,344 $10,223
========= ======== ======== ======== ======== ========
Earnings per
share -
diluted $ 0.48 $ 0.51 $ 0.54 $ 0.50 $ 0.55 $ 0.55
========= ======== ======== ======== ======== ========
Weighted
average
shares
outstanding -
diluted 19,821 19,755 19,336 19,228 18,777 18,486
========= ======== ======== ======== ======== ========
As Reported
- ---------------
Net sales $82,015 $82,225 $86,924 $89,651 $93,911 $95,187
Cost of sales 19,499 19,760 20,747 21,338 22,276 22,188
--------- -------- -------- -------- -------- --------
Gross
profit 62,516 62,465 66,177 68,313 71,635 72,999
Operating
expenses
Associate
incentives 31,911 32,545 34,692 35,428 37,454 38,483
Selling,
general and
admini-
strative 15,168 14,756 15,553 17,626 17,991 17,898
Research and
development 689 551 500 732 830 881
--------- -------- -------- -------- -------- --------
Earnings
from
operations 14,748 14,613 15,432 14,527 15,360 15,737
Other income (67) 172 217 295 336 68
--------- -------- -------- -------- -------- --------
Earnings
before
income
taxes 14,681 14,785 15,649 14,822 15,696 15,805
Income taxes 5,138 4,743 5,168 5,262 5,352 5,582
--------- -------- -------- -------- -------- --------
NET EARNINGS $ 9,543 $10,042 $10,481 $ 9,560 $10,344 $10,223
========= ======== ======== ======== ======== ========
Earnings per
share -
diluted $ 0.48 $ 0.51 $ 0.54 $ 0.50 $ 0.55 $ 0.55
========= ======== ======== ======== ======== ========
Weighted
average
shares
outstanding -
diluted 19,821 19,755 19,336 19,228 18,777 18,486
========= ======== ======== ======== ======== ========
USANA Health Sciences, Inc.
Sales by Segment and Region
(in thousands)
(unaudited)
Quarter Ended
------------------------------------------------------
3-Apr-04 3-Jul-04 2-Oct-04 1-Jan-05 2-Apr-05 2-Jul-05
-------- -------- -------- -------- -------- ---------
As Reclassified
Region
--------------
North America
United States $26,771 $27,485 $28,430 $29,465 $30,806 $32,637
Canada 12,269 12,206 12,392 14,933 14,638 15,053
Mexico 747 2,209 2,255 3,047 3,174 3,889
-------- -------- -------- -------- -------- ---------
North America
Total 39,787 41,900 43,077 47,445 48,618 51,579
Pacific Rim
Australia-New
Zealand 8,164 8,350 8,933 9,740 10,491 11,084
Hong Kong 2,407 2,670 2,765 2,977 2,938 3,263
Japan 2,196 2,155 2,330 2,439 2,465 2,577
Taiwan 3,698 3,865 3,866 4,432 5,019 5,337
South Korea 1,261 1,793 1,354 1,268 1,015 1,292
Singapore 1,983 2,578 2,638 2,969 3,052 3,543
-------- -------- -------- -------- -------- ---------
Pacific Rim
Total 19,709 21,411 21,886 23,825 24,980 27,096
-------- -------- -------- -------- -------- ---------
Segment Total 59,496 63,311 64,963 71,270 73,598 78,675
-------- -------- -------- -------- -------- ---------
Contract
Manufacturing 1,534 3,120 2,829 2,828 1,929 2,203
-------- -------- -------- -------- -------- ---------
Consolidated $61,030 $66,431 $67,792 $74,098 $75,527 $80,878
======== ======== ======== ======== ======== =========
As Reported
Region
--------------
North America
United States $27,101 $27,821 $28,827 $29,830 $31,203 $33,067
Canada 12,437 12,378 12,553 15,184 14,862 15,287
Mexico 748 2,216 2,268 3,064 3,193 3,910
-------- -------- -------- -------- -------- ---------
North America
Total 40,286 42,415 43,648 48,078 49,258 52,264
Pacific Rim
Australia-New
Zealand 8,276 8,471 9,056 9,881 10,644 11,241
Hong Kong 2,457 2,750 2,837 3,073 3,040 3,377
Japan 2,216 2,176 2,356 2,470 2,498 2,620
Taiwan 3,729 3,898 3,903 4,479 5,064 5,381
South Korea 1,270 1,804 1,366 1,302 1,045 1,323
Singapore 2,007 2,612 2,678 3,019 3,100 3,606
-------- -------- -------- -------- -------- ---------
Pacific Rim
Total 19,955 21,711 22,196 24,224 25,391 27,548
-------- -------- -------- -------- -------- ---------
Segment Total 60,241 64,126 65,844 72,302 74,649 79,812
-------- -------- -------- -------- -------- ---------
Contract
Manufacturing 1,534 3,120 2,829 2,828 1,929 2,203
-------- -------- -------- -------- -------- ---------
Consolidated $61,775 $67,246 $68,673 $75,130 $76,578 $82,015
======== ======== ======== ======== ======== =========
Quarter Ended
----------------------------------------------
1-Oct-05 31-Dec- 1-Apr-06 1-Jul-06 30-Sep-
05 06
-------- -------- -------- -------- --------
As Reclassified
Region
----------------------
North America
United States $34,636 $36,148 $38,468 $39,250 $39,425
Canada 15,014 16,547 16,701 17,721 16,574
Mexico 3,424 3,479 4,053 4,323 4,503
-------- -------- -------- -------- --------
North America Total 53,074 56,174 59,222 61,294 60,502
Pacific Rim
Australia-New Zealand 11,180 11,956 11,100 12,104 12,297
Hong Kong 2,889 3,127 3,064 3,376 4,533
Japan 2,526 2,605 2,399 2,379 2,357
Taiwan 4,852 4,860 4,939 4,978 5,509
South Korea 1,218 1,225 1,180 1,704 2,117
Singapore 3,624 3,370 3,427 3,813 4,603
-------- -------- -------- -------- --------
Pacific Rim Total 26,289 27,143 26,109 28,354 31,416
-------- -------- -------- -------- --------
Segment Total 79,363 83,317 85,331 89,648 91,918
-------- -------- -------- -------- --------
Contract Manufacturing 1,675 2,329 2,898 2,834 1,780
-------- -------- -------- -------- --------
Consolidated $81,038 $85,646 $88,229 $92,482 $93,698
======== ======== ======== ======== ========
As Reported
Region
----------------------
North America
United States $35,181 $36,672 $39,057 $39,818 $40,015
Canada 15,231 16,813 16,979 18,010 16,814
Mexico 3,449 3,508 4,098 4,373 4,555
-------- -------- -------- -------- --------
North America Total 53,861 56,993 60,134 62,201 61,384
Pacific Rim
Australia-New Zealand 11,341 12,141 11,274 12,291 12,488
Hong Kong 2,971 3,234 3,176 3,480 4,643
Japan 2,562 2,643 2,432 2,417 2,390
Taiwan 4,885 4,895 4,981 5,034 5,587
South Korea 1,250 1,264 1,216 1,762 2,201
Singapore 3,680 3,425 3,540 3,892 4,714
-------- -------- -------- -------- --------
Pacific Rim Total 26,689 27,602 26,619 28,876 32,023
-------- -------- -------- -------- --------
Segment Total 80,550 84,595 86,753 91,077 93,407
-------- -------- -------- -------- --------
Contract Manufacturing 1,675 2,329 2,898 2,834 1,780
-------- -------- -------- -------- --------
Consolidated $82,225 $86,924 $89,651 $93,911 $95,187
======== ======== ======== ======== ========
CONTACT: USANA Health Sciences, Inc.
Riley Timmer, Investor Relations, (801) 954-7100
investor.relations@us.usana.com