EX-99.1 2 ex_154081.htm EXHIBIT 99.1 ex_154081.htm

Exhibit 99.1

 

 

NEWS RELEASE

 

 

For more information, contact:

 

Steve Albright

Chief Financial Officer                    

(636) 733-1305                         

 

FOR IMMEDIATE DISTRIBUTION

 

Reliv International Reports Second-Quarter Financial Results for 2019

 

CHESTERFIELD, MO, August 9, 2019 – Reliv International, Inc. (NASDAQ:RELV), a maker of nutritional supplements that promote optimal health, today reported its financial results for the second quarter of 2019 and announced the formal launch of its RLV line of hemp-extract products at its recent distributor conference in suburban Chicago.

 

Reliv reported net sales of $8.3 million for the second quarter of 2019 compared with net sales of $8.5 million in the second quarter of 2018. Net sales in the United States decreased to $5.9 million in the second quarter of 2019, which represented a 6.8 percent decline in net sales when compared to the prior-year quarter. Net sales in Reliv’s foreign markets increased 10.8 percent in the second quarter of 2019 compared with the prior-year quarter. Increases in net sales in Asia and Mexico were 82.7% and 36.6%, respectively, in the second quarter of 2019, offset by a decrease in net sales in Europe of 26.7%, along with decreases in other regions.

 

Reliv reported a net loss for the second quarter of 2019 of $388,000 (loss per diluted share of $0.22) compared to a net loss of $978,000 (loss per diluted share of $0.53) in the second quarter of 2018. The loss from operations for the second quarter of 2019 was $366,000 compared to a loss from operations of $940,000 in the same period in 2018. Results from operations in the second quarter of 2019 improved from the prior-year quarter as selling, general and administrative (“SGA”) expenses decreased by $527,000 to $3.7 million in the second quarter of 2019 compared to $4.2 million in the prior-year quarter; however, the decline in sales did not permit us to reach profitability in the quarter.

 

Net sales for the first six months of 2019 were $17.7 million, which represented a 3.9 percent decrease from the same period in 2018. Net sales in the United States decreased by 7.1 percent and net sales in Reliv’s foreign markets increased by 6.1 percent in the first half of 2019 compared with the first half of last year. Net sales in Reliv’s foreign markets increased by 9.8 percent during the first half of 2019 when the impact of foreign currency fluctuation is removed.

 

Reliv reported net income of $236,000, or $0.13 per diluted share in the first six months of 2019, compared to a net loss of $1.2 million or $0.66 per diluted share in the same period of 2018. SGA expenses decreased to $7.4 million in the first six months of 2019 compared to $8.7 million in the prior-year period.

 

Reliv had cash and cash equivalents of $1.9 million as of June 30, 2019, compared to $2.0 million as of December 31, 2018. Net cash used in operating activities was $644,000 in the first six months of 2019.

 

 

 

 

As of June 30, 2019, Reliv had 32,870 distributors and preferred customers – an increase of 5.6 percent from June 30, 2018 – of which 2,980 are Master Affiliate level and above. The number of Master Affiliates decreased by 6.9 percent compared to the year-ago total. Master Affiliate is the level at which distributors are eligible to earn generation royalties.

 

At its recent distributor conference in suburban Chicago, Reliv formally introduced its RLV line of hemp-extract products. Initially, the RLV line includes three liquid tinctures and one balm. All of the RLV products are derived from organically-grown, non-GMO hemp.

 

“This is our most exciting product launch in a number of years,” commented Ryan A. Montgomery, Chief Executive Officer. “The RLV line is our introduction into a rapidly evolving and growing market that has the ability to propel our business for years to come.”

 

In international operations, sales and distributor activity in the Philippines continues to grow at a rate that has resulted in the Philippines becoming our second largest market. “Our growth continues in the Philippines at a phenomenal pace, driven by a broad-based increase in the number of new distributors and preferred customers and in the sales of our Reliv Now for Kids product,” noted Montgomery. Net sales in the Philippines grew by 98.7% in local currency in the second quarter of 2019, compared to the prior-year quarter, as the active distributor and preferred customer and Master Affiliate counts across all of the Asia markets increased by 91% and 47%, respectively. “The activity level and momentum in the Philippines has been exciting. We are looking for that growth to cross into other markets in our Asia-Pacific region and elsewhere in the Reliv world,” said Montgomery.

 

 

About Reliv International, Inc.

 

Reliv International, based in Chesterfield, MO, produces nutritional supplements that promote optimal nutrition. Reliv supplements address core nutrition and targeted solutions. Reliv is the exclusive provider of LunaRich® products, which optimize levels of lunasin, a soy peptide that works at the epigenetic level to promote optimal health. The company sells its products through an international network marketing system of independent distributors in 14 countries. Learn more about Reliv at reliv.com, or on Facebook, Twitter or Instagram.

 

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

 

--FINANCIAL HIGHLIGHTS FOLLOW –

 

 

 

 

Reliv International, Inc. and Subsidiaries

               
                 

Condensed Consolidated Balance Sheets

               
   

June 30

   

December 31

 
   

2019

   

2018

 
   

(Unaudited)

   

(Audited)

 

Assets

               

Current Assets:

               

Cash and cash equivalents

  $ 1,918,721     $ 1,989,974  

Accounts receivable, less allowances of $5,000 in 2019 and 2018

    235,030       400,759  

Notes & accounts receivables & deposits - related parties

    1,027,126       151,222  

Inventories

    2,709,155       2,954,947  

Assets held for sale

    -       2,124,939  

Other current assets

    766,034       464,165  
                 

Total current assets

    6,656,066       8,086,006  
                 

Notes & accounts receivables - related parties

    2,490,528       1,282,072  

Other assets

    3,085,908       2,287,237  

Net property, plant and equipment

    4,569,237       4,698,550  
                 

Total Assets

  $ 16,801,739     $ 16,353,865  
                 

Liabilities and Stockholders' Equity

               
                 

Accounts payable, accruals & other current liabilities

  $ 3,937,133     $ 3,915,390  

Revolving line of credit

    500,000       -  

Other noncurrent liabilities

    626,701       445,611  

Stockholders' equity

    11,737,905       11,992,864  
                 

Total Liabilities and Stockholders' Equity

  $ 16,801,739     $ 16,353,865  

 

Consolidated Statements of Operations

                               
   

Three months ended June 30

   

Six months ended June 30

 
   

2019

   

2018

   

2019

   

2018

 
   

(Unaudited)

   

(Unaudited)

   

(Unaudited)

   

(Unaudited)

 

Product sales

  $ 7,603,041     $ 7,920,596     $ 16,414,038     $ 17,311,977  

Freight income

    479,881       539,145       999,822       1,151,003  

Other revenue

    174,091       -       332,657       -  
                                 

Net Sales

    8,257,013       8,459,741       17,746,517       18,462,980  
                                 

Costs and expenses:

                               

Cost of goods sold

    2,268,992       2,356,274       4,702,723       4,706,016  

Distributor royalties and commissions

    2,665,093       2,827,357       5,782,665       6,219,102  

Selling, general and administrative

    3,688,944       4,215,641       7,428,472       8,701,536  
                                 

Total Costs and Expenses

    8,623,029       9,399,272       17,913,860       19,626,654  
                                 

Loss from operations

    (366,016 )     (939,531 )     (167,343 )     (1,163,674 )
                                 

Other income (expense):

                               

Interest income

    46,218       23,547       95,480       47,499  

Interest expense

    (10,075 )     (45,222 )     (15,487 )     (76,787 )

Other income (expense)

    4,768       7,214       (660 )     13,865  

Gain (loss) on sale of fixed assets

    -       (962 )     434,549       2,838  
                                 

Income (loss) before income taxes

    (325,105 )     (954,954 )     346,539       (1,176,259 )

Provision for income taxes

    63,000       23,000       111,000       40,000  
                                 

Net income (loss)

  $ (388,105 )   $ (977,954 )   $ 235,539     $ (1,216,259 )
                                 
                                 

Earnings (loss) per common share - Basic

  $ (0.22 )   $ (0.53 )   $ 0.13     $ (0.66 )

Weighted average shares

    1,746,000       1,845,000       1,746,000       1,845,000  
                                 

Earnings (loss) per common share - Diluted

  $ (0.22 )   $ (0.53 )   $ 0.13     $ (0.66 )

Weighted average shares

    1,746,000       1,845,000       1,746,000       1,845,000  

 

 

 

 

Reliv International, Inc. and Subsidiaries

 

Net sales by Market

                                               

(in thousands)

 

Three months ended June 30,

   

Change from

 
   

2019

   

2018

   

prior year

 
   

Amount

   

% of Net Sales

   

Amount

   

% of Net Sales

   

Amount

   

%

 
                                                 

United States

  $ 5,905       71.5 %   $ 6,336       74.9 %   $ (431 )     -6.8 %

Australia/New Zealand

    132       1.6 %     178       2.1 %     (46 )     -25.8 %

Canada

    140       1.7 %     162       1.9 %     (22 )     -13.6 %

Mexico

    153       1.8 %     112       1.3 %     41       36.6 %

Europe

    756       9.2 %     1,031       12.2 %     (275 )     -26.7 %

Asia

    1,171       14.2 %     641       7.6 %     530       82.7 %
                                                 

Consolidated Total

  $ 8,257       100.0 %   $ 8,460       100.0 %   $ (203 )     -2.4 %

 

Net sales by Market

                                               

(in thousands)

 

Six months ended June 30,

   

Change from

 
   

2019

   

2018

   

prior year

 
   

Amount

   

% of Net Sales

   

Amount

   

% of Net Sales

   

Amount

   

%

 
                                                 

United States

  $ 13,016       73.4 %   $ 14,006       75.9 %   $ (990 )     -7.1 %

Australia/New Zealand

    309       1.7 %     410       2.2 %     (101 )     -24.6 %

Canada

    340       1.9 %     404       2.2 %     (64 )     -15.8 %

Mexico

    289       1.6 %     220       1.2 %     69       31.4 %

Europe

    1,695       9.6 %     2,195       11.9 %     (500 )     -22.8 %

Asia

    2,098       11.8 %     1,228       6.6 %     870       70.8 %
                                                 

Consolidated Total

  $ 17,747       100.0 %   $ 18,463       100.0 %   $ (716 )     -3.9 %

 

 

The following table sets forth, as of June 30, 2019 and 2018, the number of our Active Distributors/Preferred Customers and Master Affiliates and above.  The total number of active distributors includes Master Affiliates and above. We define an active distributor as one that enrolls as a distributor or renews his or her distributorship during the prior twelve months.  Master Affiliates and above are distributors that have attained the highest level of discount and are eligible for royalties generated by Master Affiliate groups in their downline organization.    Preferred Customers represent approximately 7,520 and 4,760 of the Active Distributor count as of June 30, 2019 and 2018, respectively. 

 

 

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

 

   

As of 6/30/2019

   

As of 6/30/2018

   

Change in %

 
   

Active Distributors and Preferred Customers

   

Master Affiliates and Above

   

Active Distributors and Preferred Customers

   

Master Affiliates and Above

   

Active Distributors and Preferred Customers

   

Master Affiliates and Above

 
                                                 
                                                 

United States

    19,290       1,980       21,060       2,270       -8.4 %     -12.8 %

Australia/New Zealand

    910       70       1,030       80       -11.7 %     -12.5 %

Canada

    530       60       580       80       -8.6 %     -25.0 %

Mexico

    1,190       100       780       70       52.6 %     42.9 %

Europe

    2,530       300       3,290       380       -23.1 %     -21.1 %

Asia

    8,420       470       4,400       320       91.4 %     46.9 %
                                                 

Consolidated Total

    32,870       2,980       31,140       3,200       5.6 %     -6.9 %