Nature's Sunshine Plans to Cut Costs

Nature's Sunshine Plans to Cut Costs

PROVO, Utah--Nature's Sunshine Products Inc. (NASDAQ:NATR)intends to implement various cost-cutting measures after seeing results from itsfirst quarter (1Q02), ended March 31 and reported April 23. Net sales for theyear decreased 7 percent to $75.9 million from $81.7 million logged in the sameperiod last year. Gross margin broke even at 82 percent of sales, as didoperating expenses, hovering at $60 million. Net loss for the year was $888,000,or $.05 per share lost, compared to 1Q01's net profit of $4.0 million, or $.25per share earned.

For the quarter, Nature's Sunshine had increased sales in SouthKorea and the Russian Federation, although these gains were offset by a loss of$3.1 million in Brazil, where import regulations adversely affected results. Thenumber of worldwide distributors dropped 3 percent to 570,000, although thenumber of worldwide managers increased from 18,900 to 19,400. In an effort tostaunch a negative bottom line, the company repurchased 169,000 shares at aprice of $12.67 (raising $2.1 million) during a stock buyback in 1Q02.

For the second quarter, the company expects a return toprofitability from planned cost-cutting measures. According to Daniel Howells,president and chief executive officer, "We believe that the cost reductionmeasures we are implementing company-wide, as well as other steps to improveperformance, will benefit the company going forward."

On April 30, the company declared a 3 1/3 cent per common sharequarterly cash dividend that was payable May 21 to shareholders of record on May14.

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