USNA - Earnings call transcript Q4 2021 | USANA Health Sciences, Inc.

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Operator

00:04 Good day, ladies and gentlemen, and welcome to USANA Health Sciences' Fourth Quarter Conference Call. Today's conference is being recorded. At this time, I'd like to turn the conference over to Mr. Patrique Richards, Executive Director of Investor Relations and Business Development. Please go ahead.

Patrique Richards

you. Thank XX:XX Good morning. to results. us our quarter joining fourth review full-year you and appreciate We Today's via broadcast be being conference is call live from website accessed our webcast at ir.usana.com. directly can and be the a following our Shortly XX:XX replay will website. available call, on

the before Hekking; from website. Yesterday, fourth remarks closed, on call our we management XX:XX as risk disclosures, Doug morning by Chief materially that statements quarter of operations, forward-looking to XX:XX regarding As our scope, conference should the with statements. President, will brief Kevin risks caution other announced Those We'll We the as this from our future XX:XX hear joined or Kevin be for results XXXX, include to statements the and specific Examples recent these I'm call, most executive in and regarding differ performance uncertainty Officer, as company's that well of financial uncertainties this the after the our considered these a for involve statements you the financial future business, members in the forward-looking with Jim Guest; could document duration well of and SEC. our filings projected fiscal management results of financial our Financial statements those of such during results. in including contained events commentary our as our Brown; magnitude, outlook strategies reminder, pandemic perhaps the cause data now team. course the of market impact opening factors actual and make and XX:XX our the of related Board, the results and to COVID-XX Chairman company. questions. year conjunction posted CEO and our

Kevin Guest

year marked our outlook you, quarter well XXXX. dynamic to environment. a XXXX our and appreciate what in full-year initial as joining solid everyone. for good performance results, of and We remains morning, XX:XX a review operating you fourth Thank Pat, as us

X%. For results tool XX:XX that to last pandemic is the two-plus not point. remains evolved has enhancements Technology pressured last progress financial and on to its focal introducing and year, rollout by of over customized learned we've full-year, in COVID-XX is a performance. a to recommendation product disruptions made XX:XX strategic to our business continue where acquisition. shopping our the website long-term customer mind. XXXX, several lockdowns as offerings, business This first manage version with in operating creation initiatives. digital our sales And meaningful linear. our improvements environment drive And quarter branded native we However, we investment including We our our believe fourth made our evident several we tools, and These growth grew the with this in impact net years, an in we releasing will the sustainable enhancements help excellent XX:XX shopping app of tool, provide and experience, and China. customers the

active our on the customer business China, year, in USANA's pursuing continue digital we in XXth growing to innovation, transformation in growing initiatives, and benefits on investment also made invest XX:XX Lake progress business and counts. anniversary manufacturing an on innovation, our we XX:XX City, product objective to maintain focus will food's scientists map. strategically and on this product we development As opportunities, of this road we our with focus with product specialists Salt expect Additionally, business product our focused investments all our in transitioned years product unwavering our long-term and leveraging the facility the facility. We've on see embark development we and to coming as financial more in our

and safe events a half hybrid, this in-person it hosting the also in in USANA's XX:XX is an of We permitted by in-person do and We anniversary hosting are planning Lake back we're virtual, China to excited to event in celebrate planning are are event XXth currently in to host where to where in-person resume we year so. the Salt year. markets City,

to continue additive markets the believe sales momentum the short-term across needs of in-person markets. and We plan XX:XX within driving to individual events excitement important that sales our programs suit of both to year several are throughout we run force. Additionally, and our to

fiscal markets like return to currently of Before a outlook. turning optimistic call are some lockdowns, over are by of normalcy severely impacted while for the our markets remain our We other COVID-related XX:XX XXXX briefly I'd signs on reopening. questions, discuss to cautiously as seeing

XX:XX such, accelerate and carry will guidance We net anticipate the sales a earnings sales our range. wider-than-normal net that throughout share year. diluted As per

strategies our We for strategic also on to us expect to and positioned With operator relative line in confident are on pressure become historical future operating areas questions. XX:XX pressures our which business, investments our margin digital inflationary even more we ask of costs. growth. some I'll drive performance, to key now please infrastructure, that, closing, enable travel the In and open reflects will the event-related XX:XX increased to our

Operator

you. instructions] Steph Please go [Operator question our ahead. Thank with We'll XX:XX from take Wissink first Jefferies.

Steph Wissink

you. day, Thank XX:XX Good everyone.

could. questions few if We have we a

the today on sales The the year. remarks the just regarding first is through acceleration on your call

year give somewhat unusual the us a of two-part And then kind out. just guidance? can the to of point recognizing some point there you year, year as us starting magnitude, just effects sense the to remind if it's contemplated One, you've as So, played any your are comparison was just in the question. prior if unusual a ending XXXX

Doug Hekking

this Stephanie, Yeah. is Doug. XX:XX

appreciate I question. your so, And

throughout the planned have the to that of to of of Chinese And period you timing in with lot ramp-up that holiday and period now, the Right tough then done promotional time. year. whole do we're some these has see. the test year the activity during of Year. the some a kind New It's during So, programs of get we

ramp third promotion more out period culminated we heavy And the XXXX and in sure with quarter. so, be the as aware, the spread kind happening the market pretty kind XXXX. XX:XX significance in third of That little every really quarter a time. second you're of the same with year, what of I'm was That expected at quarter, bit in did throughout happened will in

that first is – kind of modestly sequentially kind those And hopefully and kind from then we'll so, build at of and that We'll build there. captures of the both above or a see see is things match. quarter

Steph Wissink

really then question inputs. comments That's And Doug. related to Okay. cost my is XX:XX on second your helpful,

most basket, the the to do If you pressure? magnitude offset can to And just you the give heavily what's basket? have pressure? at or some plan in sense price? of And if your you're cost seeing take you densified us the most a what of Where

Doug Hekking

product really have the in are inputs itself, there. XX:XX Yeah. mean, I flowing all that relative you the to

seeing think as a is China, XX:XX I the And You board, throughout environment, well. and some their a and organization, of not pressure there there. the have back the into, and only just we've pressure with that some of are a biggest I overhead from go and bit seen X% but some X% so costs. and environment unknown. transportation risk price year, range with got other bit a XX:XX we've levels materials throughout continue year. far production just we're have so, just outside well. the to our of of transportation away costs they're the and the profile to just above markets pressure. historic in think as costs In of not definitive that come it little the kind seeing the been then definitively, in get they're this on the some material across And somewhere there's magnitude Wages, in And hoping secured we're little right even half in Mainland to dealing abating it's we start the uncertainty we've seeing domestic, but we're back suppliers, of as pressure of bids the wages start We're kind the now, we've cost paying seeing don't markets

more throughout other is year. I of we little see the bit persistent think these some a things

Steph Wissink

And X%, to are blended average price than that seeing and you higher of into or do if intend XX:XX give And of sense that higher us yet a you have price you kind you can going you're cost increase costing of a to X% cost? Okay. taken or to? a level

Doug Hekking

Yeah. XX:XX

of a We've Kevin and with time our talked our markets' thoughtful trying approach. this. so, pretty a lot leadership, spent direction of we've with to really take sales Jim, And pragmatic from kind and

we're think a adjustment, adjust the happen things it we quarter And modest trying really – have bunch that varies as it of a it's first these in price price balance but should XX:XX we then by first but yes, there we'll start to in modest and typically will abating And relatively will things adjustment. I quarter, second market, expect accordingly. to but… be of So, and some

Steph Wissink

more some question to some Last you you to XXXX? in you've Anything sense is that deploy tests? early the you. count. been widely running us you that Okay. expect drive Thank Can activate just associate of from found give mentioned think that And network. XX:XX to I to your learnings on those you just be tests customer of successful

Doug Hekking

XX:XX Yeah.

And and so, in with we're world up sales then exception China, fortunate Neidig our David Stephanie, Brent of heads to Mulham, Mainland who the have the around here.

from is probably talk gentlemen mouth. horse's can – I'll the present maybe it on those you they're let hear so, right And since today that

Brent Neidig

Good morning. XX:XX Yeah.

in So, we've a seen deliver solutions certainly tests number the experiences programs. terms tail think XXXX. level of through through engagement, able the process our result cycles. yeah, we've run in rewards longer a from definitely with process, the stickier that that a we've just And XX:XX a but high end of of and series as of been able those I a the their what been customers – not and we've is a back to over of that purchasing of So,

Doug Hekking

… XX:XX perspective, anything China a from else to Brent,

Brent Neidig

and ran are being attracted XX:XX they individuals we those both the the We've forward-looking speak what some the short-term analyzed we've for like accommodate years. looks briefly Yeah. the sales from just So, to learnings several into that those incentives over tail adjustments once made their really We've that are last promotions the couple incentives by individuals that business. those attracting. of had XX:XX heavily have types come of incentives of to of events. types certainly I'll

move continued to have to as improvements hope we we those so, results forward. And

Doug Hekking

XX:XX COVID into Yeah. saw think fully environment to of similarities and that. I just catalyst we Stephanie, there. in at the learned. is were probably the be architected from in team time this ran the that program we perspective, XX:XX time at the to kind this, about I a XXXX. not had what the think, we didn't were what we're efforts additive we've we're present we And Those appreciate business, we've in just companion getting XXXX, to fact on to did in particularly going our So, have the open been bit given few think, going pretty little of and the I had more And more you from a pretty we year enhancements to and same designed what XXXX that what sales doing have a some

Steph Wissink

If could really That's helpful. Okay. XX:XX one toss I more in.

quarter-to-quarter companion-driven actually the structural sales Do some of of is coincident terms we've or Just a that more some these to driving did of and maybe performance? that improvement. bottom something show market kind of or noticing promotions attribute on in seen China is you that and basis that that sequential fundamental basis

Brent Neidig

observation. this for We're I'm the of Stephanie, interesting optimistic is China. XXXX. an optimistic that Yes. signs very coming Brent. XX:XX out very seeing It's we're about

I difficult it's your to though, think question, to know.

to last of those the of labors. think the over improvements some see there and we've structural that starting I years, we're fruits couple made are that

board shopping Our new XX:XX certainly and making and that's really somewhat ideas, to help several they the turn leadership things. And that we're with lackluster we're very digital excited come ability enhancements on that's been momentum years. the to improvements improved have over also around the experience new has about last

the compiled going direction of about to be China. So, things we're going those I quite together, optimistic all in think

Doug Hekking

In meeting, had because just on. the Stephanie, we events a this we Yeah. expected results. out we reference had that and promotions sales little that Other we some the of I'd deferred these down it cancel pushed now in that. – got we national had because of is is add to to softer what Doug. push fourth-quarter impact Our our period. than XX:XX for market. had to We had had limited probably product-related which event XX:XX planned to

kind go are had Brent's think it to environment. of the I push comments but adapting we back think go that out and I appropriate, back to even some light to things So, postpone with and just of and had the

Steph Wissink

you, I'll Thanks, That's helpful. back everyone. encouraging queue. well. in XX:XX and very Thank as jump

Doug Hekking

you, Stephanie. Thank XX:XX

Operator

ahead. We'll Research. Instructions] go Please Doug Lane Lane with XX:XX go next to [Operator

Doug Lane

Yes. everybody. XX:XX Hi. morning, Good

cost a have and or – the pressure the inflation as well? year the more can quarter. incentives? what front, but cost little be there going in and next year the On you, Is be XXX bit about up and They I were shipping point get materials that associate to basis is you talk a going to points this

Doug Hekking

think it's in all I that's the think check. I on the in No, And comparison, a think, Doug, basis, honestly, yes, XX:XX I math. year-over-year

lower fourth see. quarter than the think typically was what I we last of year

happened bit XXXX. I of see we in some pickup XX:XX of last stuff kind the here got last think for travel as far as little we what fourth think in that with year other as this just year. it bunch didn't the XXXX, a of events level a that little that scramble and So, postponed just think, what is, and the we in were have roughly a and we reporting in quarter and this lighter I bit you'll you'll we the had had year we're I see year line of

Doug Lane

will Can will or XX:XX know like past. year. there It's talk little special ahead little run sounds more than that, Just product on typically to more Okay. we a going about XXth for? It kind the a event, activity we of you I of that year? bit be promotions your think anniversary. include hybrid a but the any in event going it's the impact kind this mentioned any perhaps bit during any convention color in-person new be component, be of more enough. should look Fair special kind Is obviously. an of you of this it's convention what to of the

Kevin Guest

Well, Doug, XX:XX Kevin. this is

rely to being generate excited at opportunity the around our an events get we heavily to of is the in world. as anniversary relates on You XXth know, prospect us momentum it also to together. our Being and we're business, for excitement able the

going personal never of to interaction do So, we're a for event like while globally. doing hope seen use to make before. in event. the simultaneous We're XX:XX meaning the anything it best, for we're we virtual excited a we've worst this are going the to event plan we're really and to the going about live technology And as an

fact promotions, in As your We of participate the to our Salt of several have to event. to not and it's new virtually attendance, in are and but be we're trying that to to have going to directly, but expect launch are question have event that unexpected will going as we just people event. City products Lake there here also expect sales that be just are one possibility some we promotion promotions thousand been limited could in relates about that COVID to queue, period some going in XX:XX XX:XX thousands year, the is not waiting it's it not tens relationship an the thinking to to product people the globally and/or we throughout launch because hoping a wanting about anniversary, XXth issues. tied that overwhelming And of tied because we've convention to the be that this in happen

product certain and/or launches that for not we're relying on So, event promotions.

Doug Lane

XX:XX sense. Thanks, Okay. Kevin. That makes

what you. one thing these all Just and last have with lockdowns

bounce that's sales Philippines reset COVID You some we mentioned come kind which level do you backs number. a out a of there? permanent XX% be imply in that of in there currency, this your could Does of or think the was big that as local commentary is that the down significant

Kevin Guest

– going XX:XX to think overnight. to we're – don't think It's build back going from bounce go have not there. it's I and I it's to back

team of all in has market have our You and probably of was And deal many So, overnight. this higher in-office, And a shut things XX:XX markets time. doing a that's through essentially market – to great think can in-person populated. And you gone that anticipating not off it year, I right jumping to they're of very really progress great where ever, progress. make was yes, I deal. to one is the XXXX. as I we'll doing hard it's but as cases, this a of some that I transaction. but tell make environment and is working think going committed night back densely mean, some day The it's take in

Doug Lane

enough. Fair Okay. XX:XX Thank you.

Kevin Guest

Doug. Thanks, XX:XX

Operator

further for no It or at closing Instructions] [Operator have to presenters remarks. it this your we time. appears additional to turn I'd back any XX:XX questions like

Patrique Richards

call. for participation for XX:XX conference today’s and on Thank your you questions your

free If at you. feel XXX-XXX-XXXX. you any have relations Thank remaining investor please contact questions, to

Operator

XX:XX We today's appreciate Ladies teleconference. gentlemen, and your this concludes participation.

You may now disconnect.

USANA Health Sciences (USNA) 10 Feb 222021 Q4 Earnings call transcript