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Reliv International Reports Third-Quarter Financial Results for 2020

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Reliv International reported third-quarter 2020 net sales of $8.7 million, down 5.3% from $9.1 million in Q3 2019. U.S. sales decreased by 2.4%, largely influenced by previous product launches. Foreign sales were more affected, dropping 13.9%, with significant declines in Asia and Europe due to COVID-19. The net loss for the quarter was $125,000 versus $166,000 in the prior year. Although cash reserves grew to $3.3 million, the company plans to implement a reverse stock split as part of a strategy to delist from NASDAQ.

Positive
  • Net income for the first nine months of 2020 was $339,000, up from $70,000 in the same period last year.
  • 3.8% increase in U.S. net sales for the first nine months of 2020.
Negative
  • Q3 net sales decreased by 5.3% year-over-year.
  • Foreign sales decreased by 13.9% in Q3 2020.
  • Net loss from operations increased to $167,000 in Q3 2020.

CHESTERFIELD, Mo., Nov. 13, 2020 /PRNewswire/ -- Reliv International, Inc. (NASDAQ:RELV), a marketer of nutritional supplements that promote optimal health, today reported its financial results for the third quarter of 2020.

Reliv reported net sales of $8.7 million for the third quarter of 2020 compared with net sales of $9.1 million in the third quarter of 2019, a decrease of 5.3%. Net sales in the United States, our largest market, decreased by $161,000 in the third quarter of 2020, which represented a 2.4% decrease in net sales when compared to the prior-year quarter. In the third quarter of 2019, net sales in the United States were favorably impacted by the then-recent launch of the RLV line of hemp-extract products and by the announcement of a price increase effective October 1, 2019.

Net sales in Reliv's foreign markets decreased by $320,000, or 13.9%, in the third quarter of 2020 compared with the prior-year quarter. Net sales in Asia and Europe decreased by 20.3% and 13.5%, respectively, in the third quarter of 2020, as net sales in these regions continue to be heavily impacted by the COVID-19 pandemic. Net sales in Reliv's foreign markets decreased by 17.0% during the third quarter of 2020 when the impact of foreign currency fluctuation is removed.

Reliv reported a net loss for the third quarter of 2020 of $125,000 (loss per diluted share of $0.07) compared to a net loss of $166,000 (loss per diluted share of $0.09) in the third quarter of 2019. The loss from operations for the third quarter of 2020 was $167,000 compared to a loss from operations of $85,000 in the same period in 2019. Results from operations declined primarily as the result of the decrease in net sales and gross margin.

Net sales for the first nine months of 2020 were $27.0 million, which represents a 0.3% increase from the same period in 2019. Net sales in the United States increased by 3.8% and net sales in Reliv's foreign markets decreased by 9.7% in the first nine months of 2020 compared with the same period last year. Net sales in Reliv's foreign markets decreased by 10.1% during the first nine months of 2020 when the impact of foreign currency fluctuation is removed.

Reliv reported net income of $339,000, or $0.19 per diluted share in the first nine months of 2020, compared to a net income of $70,000 or $0.04 per diluted share in the same period of 2019.

Reliv had cash and cash equivalents of $3.3 million as of September 30, 2020, compared to $1.6 million as of December 31, 2019. Net cash provided by operating activities was $772,000 in the first nine months of 2020. 

As of September 30, 2020, Reliv had 24,850 active Distributors – a decrease of 4.1% from September 30, 2019 – of which 3,310 are Master Affiliate level and above. The number of Master Affiliates increased by 5.4% compared to the prior year total, driven by advancements in the Philippines. Master Affiliate is the level at which distributors are eligible to earn generation royalties. As of September 30, 2020, Reliv had 13,200 retail customers and Preferred Customers in total – a decrease of 12.0% from September 30, 2019.  The actual number of customers is much higher as many Distributors (approximately 74% in the U.S.) join Reliv to purchase our products at a discount and do not participate in the business opportunity and the count also does not include those customers that buy product directly from distributors rather than from the Company. 

"We believe Reliv is positioned well in the nutrition and work from home industries. The challenges caused by the COVID-19 pandemic continue, but we're pleased with how our field has adapted with more frequent use of online technology to communicate and operate," commented Ryan A. Montgomery, Chief Executive Officer. "We believe the work done this summer and early fall with virtual conferences and other tools will lead to stronger sales for the remainder of the year."  

Reliv has hosted online conferences targeted to its North American and European regions over the past three months and will host one for its Asia-Pacific region in November.  "We are pleased with the content created and presented to much of the Reliv world, not only for its immediate impact, but the long-term value created by the mobile app and online content for customer acquisition and distributor training," said Montgomery.

In international operations, net sales in Reliv's key markets in Europe and Asia continue to be challenged as local COVID-19 guidelines still are generally more restrictive than those in the United States.  "Foreign sales, particularly in the Philippines, continue to be dampened by the pandemic," noted Montgomery.  "However, we believe we still have a solid base of business in our foreign markets and feel sales will rebound as the world emerges from this global crisis.  We firmly believe the efficacy of our products and value of our home-based business opportunity play a role in this recovery."

Last month, Reliv announced its intention to effect a reverse stock split, followed by a forward split of its common stock as part of a plan to delist its stock from NASDAQ and suspend its filing obligations to the U.S. Securities and Exchange Commission.  Reliv believes the costs of being a public reporting company far outweigh its benefits.  Reliv expects the plan to be complete on or after November 29, 2020.

About Reliv International, Inc.

Reliv International, based in Chesterfield, MO, develops and markets nutritional supplements that promote optimal nutrition. Reliv supplements address core nutrition, targeted solutions and overall wellness and now include a line of RLV hemp extracts. 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 direct selling system of independent distributors in 13 countries. Learn more about Reliv at reliv.com, or on FacebookTwitter 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







September 30

December 31





2020

2019





(Unaudited)

(Audited)




Assets






Current Assets:






Cash and cash equivalents

$3,339,675

$1,630,779




Accounts receivable, less allowances of






$5,000 in 2020 and 2019

58,157

107,369




Notes & accounts receivables & deposits - related parties

1,106,221

1,099,228




Inventories

2,828,738

2,701,688




Other current assets

490,620

326,454










Total current assets

7,823,411

5,865,518










Notes & accounts receivables - related parties

2,331,844

2,418,921




Other assets

2,343,238

2,581,717




Net property, plant and equipment

4,208,008

4,440,840










Total Assets

$16,706,501

$15,306,996










Liabilities and Stockholders' Equity












Accounts payable, accruals & other current liabilities

$3,696,451

$3,489,157




Long-term debt - current

977,229

500,000




Long-term debt, less current portion

384,771

-




Other noncurrent liabilities

214,209

216,196




Stockholders' equity

11,433,841

11,101,643










Total Liabilities and Stockholders' Equity

$16,706,501

$15,306,996
















Consolidated Statements of Operations







Three months ended September 30


Nine months ended September 30


2020

2019


2020

2019


(Unaudited)

(Unaudited)


(Unaudited)

(Unaudited)

Product sales

$7,935,387

$8,395,941


$24,855,366

$24,809,979

Freight income

489,479

521,192


1,494,281

1,521,014

Other revenue

243,478

231,732


617,922

564,389







Net Sales

8,668,344

9,148,865


26,967,569

26,895,382







Costs and expenses:






  Cost of goods sold

2,290,223

2,497,993


7,147,554

7,200,716

  Distributor royalties and commissions

2,801,005

2,939,187


8,719,538

8,721,852

  Selling, general and administrative

3,744,220

3,796,276


11,023,006

11,224,748







Total Costs and Expenses

8,835,448

9,233,456


26,890,098

27,147,316







Income (loss) from operations

(167,104)

(84,591)


77,471

(251,934)







Other income (expense):






Interest income

45,904

41,548


124,614

137,028

Interest expense

(6,717)

(24,250)


(20,755)

(39,737)

Other income (expense):

56,202

(12,564)


86,234

(13,224)

Gain on sale of fixed assets

-

-


-

434,549







Income (loss) before income taxes

(71,715)

(79,857)


267,564

266,682

Provision (benefit) for income taxes

53,000

86,000


(71,000)

197,000







Net income (loss)

($124,715)

($165,857)


$338,564

$69,682













Earnings (loss) per common share - Basic & Diluted

($0.07)

($0.09)


$0.19

$0.04

Weighted average shares 

1,746,000

1,746,000


1,746,000

1,746,000



















 

Reliv International, Inc. and Subsidiaries

















Net sales by Market





(in thousands)

Three months ended September 30,


Change from


2020


2019


prior year


Amount

% of Net
Sales


Amount

% of Net
Sales


Amount

%










United States

$          6,682

77.1%


$          6,843

74.8%


$           (161)

-2.4%

Australia/New Zealand

148

1.7%


135

1.5%


13

9.6%

Canada

128

1.5%


140

1.5%


(12)

-8.6%

Mexico

166

1.9%


156

1.7%


10

6.4%

Europe

629

7.3%


727

7.9%


(98)

-13.5%

Asia

915

10.5%


1,148

12.6%


(233)

-20.3%










Consolidated Total

$          8,668

100.0%


$          9,149

100.0%


$         (481)

-5.3%



















Net sales by Market





(in thousands)

Nine months ended September 30,


Change from


2020


2019


prior year


Amount

% of Net
Sales


Amount

% of Net
Sales


Amount

%










United States

$        20,613

76.5%


$        19,859

73.8%


$            754

3.8%

Australia/New Zealand

437

1.6%


445

1.6%


(8)

-1.8%

Canada

412

1.5%


479

1.8%


(67)

-14.0%

Mexico

420

1.6%


444

1.7%


(24)

-5.4%

Europe

2,193

8.1%


2,422

9.0%


(229)

-9.5%

Asia

2,893

10.7%


3,246

12.1%


(353)

-10.9%










Consolidated Total

$        26,968

100.0%


$        26,895

100.0%


$              73

0.3%










 

Reliv International, Inc. and Subsidiaries

























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

















As of 9/30/2020








Retail Customers

Preferred Customers

Active Distributors

Total Customers
and Distributors

Master
Affiliates and
Above

























United States

3,680

2,050

17,000

22,730

2,060








Australia/New Zealand

50

280

660

990

80








Canada

90

30

460

580

70








Mexico

30

140

1,190

1,360

90








Europe

730

560

1,540

2,830

260








Asia

850

4,710

4,000

9,560

750





















Consolidated Total

5,430

7,770

24,850

38,050

3,310






















As of 9/30/2019









Retail Customers

Preferred Customers

Active Distributors

Total Customers
and Distributors

Master
Affiliates and
Above





























United States

3,610

1,540

17,810

22,960

2,070








Australia/New Zealand

50

220

670

940

70








Canada

90

30

500

620

70








Mexico

20

110

1,170

1,300

90








Europe

740

750

1,690

3,180

310








Asia

2,390

5,450

4,060

11,900

530





















Consolidated Total

6,900

8,100

25,900

40,900

3,140



































Change in %









Retail Customers

Preferred Customers

Active Distributors

Total Customers
and Distributors

Master
Affiliates and
Above





























United States

1.9%

33.1%

-4.5%

-1.0%

-0.5%








Australia/New Zealand

0.0%

27.3%

-1.5%

5.3%

14.3%








Canada

0.0%

0.0%

-8.0%

-6.5%

0.0%








Mexico

50.0%

27.3%

1.7%

4.6%

0.0%








Europe

-1.4%

-25.3%

-8.9%

-11.0%

-16.1%








Asia

-64.4%

-13.6%

-1.5%

-19.7%

41.5%





















Consolidated Total

-21.3%

-4.1%

-4.1%

-7.0%

5.4%


































The table above sets forth, as of September 30, 2020 and 2019, the number of our Retail Customers/Preferred Customers/Active Distributors and Master Affiliates and above.  The total number of active distributors includes Master Affiliates and above. We define an active retail or preferred customer as one that has placed a product order in the prior twelve months, and we define an active distributor as one that enrolls as a distributor or renews his or her distributorship during the prior twelve months. Many individuals join Reliv as distributors to obtain our products at a discount and may not participate in the Reliv business opportunity. 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.  







 

For more information, contact:
Steve Albright                                                      
Chief Financial Officer 
(636) 733-1305

Cision View original content to download multimedia:http://www.prnewswire.com/news-releases/reliv-international-reports-third-quarter-financial-results-for-2020-301172433.html

SOURCE Reliv International, Inc.

FAQ

What were Reliv International's Q3 2020 earnings results?

Reliv reported net sales of $8.7 million in Q3 2020, a 5.3% decrease from $9.1 million in Q3 2019, and a net loss of $125,000.

How did COVID-19 impact Reliv's sales performance?

COVID-19 significantly affected foreign sales, which decreased by 13.9% in Q3 2020, especially in Asia and Europe.

What is the outlook for Reliv International following the Q3 2020 results?

Reliv's CEO expressed optimism about adapting to online technology and believes future sales will improve as the pandemic situation evolves.

What is the stock symbol for Reliv International?

The stock symbol for Reliv International is RELV.

Did Reliv announce any plans to change its stock status?

Yes, Reliv announced intentions to implement a reverse stock split followed by a forward split to delist from NASDAQ.

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