Document and Entity Information
Document and Entity Information - shares | 6 Months Ended | |
Jun. 30, 2019 | Jul. 31, 2019 | |
Cover [Abstract] | ||
Entity Registrant Name | NU SKIN ENTERPRISES INC | |
Entity Central Index Key | 0001021561 | |
Current Fiscal Year End Date | --12-31 | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Shell Company | false | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Common Stock, Shares Outstanding | 55,546,590 | |
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Jun. 30, 2019 | |
Document Fiscal Year Focus | 2019 | |
Document Fiscal Period Focus | Q2 | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Entity File Number | 001-12421 | |
Entity Tax Identification Number | 87-0565309 | |
Entity Incorporation, State or Country Code | DE | |
Entity Address, Address Line One | 75 West Center St | |
Entity Address, City or Town | Provo | |
Entity Address, State or Province | UT | |
Entity Address, Postal Zip Code | 84601 | |
City Area Code | 801 | |
Local Phone Number | 345-1000 | |
Title of 12(b) Security | Class A Common Stock, $.001 par value | |
Trading Symbol | NUS | |
Security Exchange Name | NYSE |
Consolidated Balance Sheets (Un
Consolidated Balance Sheets (Unaudited) - USD ($) $ in Thousands | Jun. 30, 2019 | Dec. 31, 2018 |
Current assets: | ||
Cash and cash equivalents | $ 360,632 | $ 386,911 |
Current investments | 7,733 | 11,346 |
Accounts receivable | 61,571 | 53,282 |
Inventories, net | 292,696 | 295,821 |
Prepaid expenses and other | 65,551 | 51,877 |
Total current assets | 788,183 | 799,237 |
Property and equipment, net | 442,990 | 464,535 |
Right-of-use assets | 118,507 | 0 |
Goodwill | 196,573 | 196,573 |
Other intangible assets, net | 84,482 | 89,989 |
Other assets | 160,363 | 144,112 |
Total assets | 1,791,098 | 1,694,446 |
Current liabilities: | ||
Accounts payable | 48,551 | 47,617 |
Accrued expenses | 306,497 | 322,583 |
Current portion of long-term debt | 59,500 | 69,455 |
Total current liabilities | 414,548 | 439,655 |
Operating lease liabilities | 84,102 | 0 |
Long-term debt | 348,986 | 361,008 |
Other liabilities | 108,512 | 111,916 |
Total liabilities | 956,148 | 912,579 |
Stockholders' equity: | ||
Class A common stock - 500 million shares authorized, $0.001 par value, 90.6 million shares issued | 91 | 91 |
Additional paid-in capital | 556,294 | 552,564 |
Treasury stock, at cost - 35.0 million and 35.2 million shares | (1,324,834) | (1,326,605) |
Accumulated other comprehensive loss | (81,276) | (79,934) |
Retained earnings | 1,684,675 | 1,635,751 |
Total stockholders' equity | 834,950 | 781,867 |
Total liabilities and stockholders' equity | $ 1,791,098 | $ 1,694,446 |
Consolidated Balance Sheets (_2
Consolidated Balance Sheets (Unaudited) (Parenthetical) - $ / shares shares in Millions | Jun. 30, 2019 | Dec. 31, 2018 |
Stockholders' equity: | ||
Common stock, shares authorized (in shares) | 500 | 500 |
Common stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Common stock, shares issued (in shares) | 90.6 | 90.6 |
Treasury stock (in shares) | 35 | 35.2 |
Consolidated Statements of Inco
Consolidated Statements of Income (Unaudited) - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | |
Consolidated Statements of Income (Unaudited) [Abstract] | ||||
Revenue | $ 623,500 | $ 704,190 | $ 1,247,123 | $ 1,320,409 |
Cost of sales | 154,028 | 168,549 | 300,692 | 314,830 |
Gross profit | 469,472 | 535,641 | 946,431 | 1,005,579 |
Operating expenses: | ||||
Selling expenses | 245,828 | 272,757 | 495,536 | 530,459 |
General and administrative expenses | 149,442 | 180,120 | 308,040 | 333,366 |
Total operating expenses | 395,270 | 452,877 | 803,576 | 863,825 |
Operating income | 74,202 | 82,764 | 142,855 | 141,754 |
Other income (expense), net | (3,326) | (11,165) | (6,174) | (9,958) |
Income before provision for income taxes | 70,876 | 71,599 | 136,681 | 131,796 |
Provision for income taxes | 24,527 | 20,638 | 47,330 | 45,296 |
Net income | $ 46,349 | $ 50,961 | $ 89,351 | $ 86,500 |
Net income per share (Note 2): | ||||
Basic (in dollars per share) | $ 0.83 | $ 0.92 | $ 1.61 | $ 1.58 |
Diluted (in dollars per share) | $ 0.83 | $ 0.90 | $ 1.59 | $ 1.53 |
Weighted-average common shares outstanding: | ||||
Basic (in shares) | 55,536 | 55,608 | 55,486 | 54,807 |
Diluted (in shares) | 55,943 | 56,713 | 56,030 | 56,430 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | |
Consolidated Statements of Comprehensive Income (Unaudited) [Abstract] | ||||
Net income | $ 46,349 | $ 50,961 | $ 89,351 | $ 86,500 |
Other comprehensive income, net of tax: | ||||
Foreign currency translation adjustment, net of taxes of $362 and $(558) for the three months ended June 30, 2019 and 2018, respectively, and $217 and $296 for the six months ended June 30, 2019 and 2018, respectively | (5,482) | (20,047) | (1,342) | (9,000) |
Net unrealized gains/(losses) on foreign currency cash flow hedges, net of taxes of zero and $(10) for the three months ended June 30, 2019 and 2018, respectively, and zero and $18 for the six months ended June 30, 2019 and 2018, respectively | 0 | 87 | 0 | (160) |
Reclassification adjustment for realized losses/(gains) in current earnings, net of taxes of zero and $3 for the three months ended June 30, 2019 and 2018, respectively, and zero and $(2) for the six months ended June 30, 2019 and 2018, respectively | 0 | (26) | 0 | 18 |
Other comprehensive income | (5,482) | (19,986) | (1,342) | (9,142) |
Comprehensive income | $ 40,867 | $ 30,975 | $ 88,009 | $ 77,358 |
Consolidated Statements of Co_2
Consolidated Statements of Comprehensive Income (Unaudited) (Parenthetical) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | |
Other comprehensive income, net of tax: | ||||
Foreign currency translation adjustment, tax | $ 362 | $ (558) | $ 217 | $ 296 |
Net unrealized gains/(losses) on foreign currency cash flow hedges, tax | 0 | (10) | 0 | 18 |
Reclassification adjustment for realized losses/(gains) in current earnings, tax | $ 0 | $ 3 | $ 0 | $ (2) |
Consolidated Statements of Stoc
Consolidated Statements of Stockholders' Equity (Unaudited) - USD ($) $ in Thousands | Common Stock [Member]Class A [Member] | Additional Paid-in Capital [Member] | Treasury Stock [Member] | Accumulated Other Comprehensive Income (Loss) [Member] | Retained Earnings [Member] | Total |
Stockholders' Equity [Roll Forward] | ||||||
Cumulative effect adjustment from adoption of ASC Topic | ASC Topic 606 [Member] | $ 0 | $ 0 | $ 0 | $ 0 | $ (13,042) | $ (13,042) |
Balance at beginning of period at Dec. 31, 2017 | 91 | 466,349 | (1,304,694) | (66,318) | 1,609,168 | 704,596 |
Stockholders' Equity [Roll Forward] | ||||||
Net income | 0 | 0 | 0 | 0 | 86,500 | 86,500 |
Other comprehensive income, net of tax | 0 | 0 | 0 | (9,142) | 0 | (9,142) |
Repurchase of Class A common stock (Note 6) | 0 | 0 | (35,823) | 0 | 0 | (35,823) |
Exercise of employee stock options/vesting of stock awards | 0 | 58 | 5,893 | 0 | 0 | 5,951 |
Stock-based compensation | 0 | 13,267 | 0 | 0 | 0 | 13,267 |
Business Acquisitions (1.4 million shares) | 0 | 76,584 | 18,109 | 0 | 0 | 94,693 |
Equity component of convertible note settlement (net) | 0 | (23,262) | 19,887 | 0 | 0 | (3,375) |
Cash dividends | 0 | 0 | 0 | 0 | (40,091) | (40,091) |
Balance at end of period at Jun. 30, 2018 | 91 | 532,996 | (1,296,628) | (75,460) | 1,642,535 | 803,534 |
Balance at beginning of period at Mar. 31, 2018 | 91 | 523,233 | (1,280,586) | (55,474) | 1,611,864 | 799,128 |
Stockholders' Equity [Roll Forward] | ||||||
Net income | 0 | 0 | 0 | 0 | 50,961 | 50,961 |
Other comprehensive income, net of tax | 0 | 0 | 0 | (19,986) | 0 | (19,986) |
Repurchase of Class A common stock (Note 6) | 0 | 0 | (18,437) | 0 | 0 | (18,437) |
Exercise of employee stock options/vesting of stock awards | 0 | 3,257 | 2,395 | 0 | 0 | 5,652 |
Stock-based compensation | 0 | 6,506 | 0 | 0 | 0 | 6,506 |
Cash dividends | 0 | 0 | 0 | 0 | (20,290) | (20,290) |
Balance at end of period at Jun. 30, 2018 | 91 | 532,996 | (1,296,628) | (75,460) | 1,642,535 | 803,534 |
Stockholders' Equity [Roll Forward] | ||||||
Cumulative effect adjustment from adoption of ASC Topic | ASC Topic 842 [Member] | 0 | 0 | 0 | 0 | 657 | 657 |
Balance at beginning of period at Dec. 31, 2018 | 91 | 552,564 | (1,326,605) | (79,934) | 1,635,751 | 781,867 |
Stockholders' Equity [Roll Forward] | ||||||
Net income | 0 | 0 | 0 | 0 | 89,351 | 89,351 |
Other comprehensive income, net of tax | 0 | 0 | 0 | (1,342) | 0 | (1,342) |
Repurchase of Class A common stock (Note 6) | 0 | 0 | (825) | 0 | 0 | (825) |
Exercise of employee stock options/vesting of stock awards | 0 | (4,904) | 2,596 | 0 | 0 | (2,308) |
Stock-based compensation | 0 | 8,634 | 0 | 0 | 0 | 8,634 |
Cash dividends | 0 | 0 | 0 | 0 | (41,084) | (41,084) |
Balance at end of period at Jun. 30, 2019 | 91 | 556,294 | (1,324,834) | (81,276) | 1,684,675 | 834,950 |
Balance at beginning of period at Mar. 31, 2019 | 91 | 553,270 | (1,325,251) | (75,794) | 1,658,879 | 811,195 |
Stockholders' Equity [Roll Forward] | ||||||
Net income | 0 | 0 | 0 | 0 | 46,349 | 46,349 |
Other comprehensive income, net of tax | 0 | 0 | 0 | (5,482) | 0 | (5,482) |
Repurchase of Class A common stock (Note 6) | 0 | 0 | 0 | 0 | 0 | 0 |
Exercise of employee stock options/vesting of stock awards | 0 | (569) | 417 | 0 | 0 | (152) |
Stock-based compensation | 0 | 3,593 | 0 | 0 | 0 | 3,593 |
Cash dividends | 0 | 0 | 0 | 0 | (20,553) | (20,553) |
Balance at end of period at Jun. 30, 2019 | $ 91 | $ 556,294 | $ (1,324,834) | $ (81,276) | $ 1,684,675 | $ 834,950 |
Consolidated Statements of St_2
Consolidated Statements of Stockholder's Equity (Unaudited) (Parenthetical) - shares shares in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | |
Stockholders' Equity [Roll Forward] | ||||
Exercise of employee stock options (in shares) | 0 | 0.1 | 0.2 | 0.2 |
Business acquisitions (in shares) | 1.4 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2019 | Jun. 30, 2018 | |
Cash flows from operating activities: | ||
Net income | $ 89,351 | $ 86,500 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Depreciation and amortization | 38,659 | 40,142 |
Equity method earnings | 0 | (43) |
Gain on step acquisitions | 0 | (13,644) |
Loss on extinguishment of debt | 0 | 7,220 |
Foreign currency losses | 1,355 | 10,194 |
Stock-based compensation | 8,634 | 13,267 |
Deferred taxes | 5,854 | 3,023 |
Non-cash lease expense | 22,505 | 0 |
Changes in operating assets and liabilities: | ||
Accounts receivable | (8,220) | (6,775) |
Inventories, net | 3,085 | (16,743) |
Prepaid expenses and other | (13,245) | (19,676) |
Other assets | (14,892) | (546) |
Accounts payable | 1,606 | 1,040 |
Accrued expenses | (66,152) | (45,363) |
Other liabilities | 5,937 | (6,663) |
Net cash provided by operating activities | 74,477 | 51,933 |
Cash flows from investing activities: | ||
Purchases of property and equipment | (29,214) | (28,429) |
Proceeds on investment sales | 7,615 | 7,964 |
Purchases of investments | (4,774) | (4,722) |
Acquisitions and investments in equity investees | (8,073) | (33,061) |
Net cash used in investing activities | (34,446) | (58,248) |
Cash flows from financing activities: | ||
Exercise of employee stock options and taxes paid related to the net shares settlement of stock awards | (2,308) | 5,951 |
Payments of debt | (152,455) | (514,177) |
Payment of cash dividends | (41,084) | (40,091) |
Payment of debt issuance costs | 0 | (7,243) |
Proceeds from debt | 130,000 | 582,398 |
Repurchases of shares of common stock | (825) | (35,823) |
Net cash used in financing activities | (66,672) | (8,985) |
Effect of exchange rate changes on cash | 362 | (9,068) |
Net increase (decrease) in cash and cash equivalents | (26,279) | (24,368) |
Cash and cash equivalents, beginning of period | 386,911 | 426,399 |
Cash and cash equivalents, end of period | $ 360,632 | $ 402,031 |
The Company
The Company | 6 Months Ended |
Jun. 30, 2019 | |
The Company [Abstract] | |
The Company | 1. The Company Nu Skin Enterprises, Inc. (the “Company”) is a holding company, with Nu Skin, a leading, global direct selling company, being the primary operating unit. Nu Skin develops and distributes premium-quality, innovative personal care products and nutritional supplements that are sold worldwide under the Nu Skin and Pharmanex brands and a small number of other products and services. The Company reports revenue from nine segments, consisting of its seven geographic Nu Skin segments—Mainland China; South Korea; Southeast Asia, which includes Indonesia, Malaysia, the Philippines, Singapore, Thailand and Vietnam; Americas/Pacific, which includes Australia, Canada, Latin America, New Caledonia, New Zealand and the United States; Japan; Hong Kong/Taiwan, which also includes Macau; and Europe, Middle East and Africa (“EMEA”), which includes several markets in Europe, as well as Israel, Russia and South Africa—its Manufacturing segment, which includes the manufacturing and packaging subsidiaries it acquired in the first quarter of 2018; and its Grow Tech segment, which focuses on a long-term strategy for consistently sourcing pure, effective and sustainable ingredients for use in the Company’s products, while also working on and developing applications in other industries (the Company’s subsidiaries operating within each segment are collectively referred to as the “Subsidiaries”). |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 6 Months Ended |
Jun. 30, 2019 | |
Summary of Significant Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | 2. Summary of Significant Accounting Policies The accompanying unaudited consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“US GAAP”) for interim financial information and with the instructions to Form 10-Q and Rule 10-01 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by US GAAP for complete financial statements. The unaudited consolidated financial statements include the accounts of the Company and its Subsidiaries. All significant intercompany accounts and transactions are eliminated in consolidation. In the opinion of management, the accompanying unaudited consolidated financial statements contain all adjustments, consisting of normal recurring adjustments, considered necessary for a fair statement of the Company’s financial information as of June 30, 2019, and for the three- and six month periods ended June 30, 2019 and 2018. The results of operations of any interim period are not necessarily indicative of the results of operations to be expected for the fiscal year. The consolidated balance sheet as of December 31, 2018 has been prepared using information from the audited financial statements at that date. For further information, refer to the consolidated financial statements and accompanying footnotes included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2018. Accounting Pronouncements In February 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standard Update (“ASU”) 2016-02, Leases In January 2017, the FASB issued ASU 2017-04, Intangibles – Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment . This guidance simplifies the required test of goodwill for impairment by eliminating Step 2 from the goodwill impairment test. If a company determines in Step 1 of the goodwill impairment test that the carrying value of a reporting unit is less than the fair value, an impairment in that amount should be recorded to the income statement, rather than proceeding to Step 2. This ASU is effective for interim and annual impairment tests in fiscal years beginning after December 15, 2019, and early adoption is permitted. The Company elected to early adopt the new standard effective January 1, 2019. The adoption of this guidance did not have a material impact on the Company’s consolidated financial statements. In December 2017, the FASB issued ASU 2017-12, Derivatives and Hedging (Topic 815): Targeted Improvements to Accounting for Hedging Activities This ASU was effective for the Company beginning on January 1, 2019. The adoption of this guidance did not have a material impact on the Company’s consolidated financial statements. In August 2018, the FASB issued ASU 2018-13, Fair Value Measurement (Topic 820): Disclosure Framework - Changes to the Disclosure Requirements for Fair Value Measurement. In August 2018, the FASB issued ASU 2018-15, Intangibles-Goodwill and Other-Internal-Use Software Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That is a Service Contract Inventory Inventories consist of the following (U.S. dollars in thousands): June 30, 2019 December 31, 2018 Raw materials $ 92,768 $ 91,610 Finished goods 199,928 204,211 Total Inventory, net $ 292,696 $ 295,821 Revenue Recognition Adoption of ASC Topic 606, “Revenue from Contracts with Customers” On January 1, 2018, the Company adopted Topic 606 using the modified retrospective method applied to those contracts which were not completed as of January 1, 2018. Results for reporting periods beginning after January 1, 2018 are presented under Topic 606, while prior period amounts are not adjusted and continue to be reported in accordance with historic accounting under Topic 605. The Company recorded a net reduction to opening retained earnings of $13.0 million, net of tax, as of January 1, 2018 due to the cumulative impact of adopting Topic 606, with the impact primarily related to the Company’s loyalty point program deferrals. The impact to revenues as a result of applying Topic 606 for the three-month periods ended June 30, 2019, and 2018 was an increase of $0.6 million and a decrease of $0.7 million, respectively. The impact to revenue for the six-month periods ended June 30, 2019, and 2018 was an increase of $ million and $ million, respectively. Revenue Recognition Net sales include products and shipping and handling charges, net of estimates for product returns and any related sales incentives. Revenue is measured as the amount of consideration the Company expects to receive in exchange for transferring products. All revenue is recognized when the Company satisfies the performance obligations under the contract. The Company recognizes revenue by transferring the promised products to the customer, with revenue recognized at shipping point, the point in time the customer obtains control of the products. The Company recognizes revenue for shipping and handling charges at the time the products are delivered to or picked up by the customer. The Company estimates product returns based on historical return rates. The majority of the Company’s contracts have a single performance obligation and are short term in nature. Sales taxes and value added taxes in foreign jurisdictions that are collected from customers and remitted to governmental authorities are accounted for on a net basis and therefore are excluded from net sales. Contract Liabilities – Customer Loyalty Programs Contract liabilities, recorded as deferred revenue within the accrued expenses line in the consolidated balance sheets, include loyalty point program deferrals with certain customers which are accounted for as a reduction in the transaction price and are generally recognized as points are redeemed for additional products on an annual basis. The balance of deferred revenue related to contract liabilities as of $ million and Disaggregation of Revenue Please refer to Note 10 - Segment Information for revenue by segment. Arrangements with Multiple Performance Obligations The Company’s contracts with customers may include multiple performance obligations. For such arrangements, the Company allocates revenues to each performance obligation based on its relative standalone selling price. The Company generally determines standalone selling prices based on the prices charged to customers for individual products sales to customers. Practical Expedients and Exemptions The Company generally expenses sales commissions when incurred because the amortization period would have been one year or less. These costs are recorded within selling expenses. The Company does not disclose the value of unsatisfied performance obligations for contracts with an original expected length of one year or less. Leases The Company determines if an arrangement is a lease at inception. Operating leases are included in right-of-use (“ROU”) assets, accrued expenses and operating lease liabilities on the consolidated balance sheets. The Company has not separately disclosed finance leases, Operating lease ROU assets represent the Company’s right to use an underlying asset for the lease term and lease liabilities represent the Company’s obligation to make lease payments arising from the lease. ROU assets and lease liabilities are recognized at the lease commencement date based on the estimated present value of lease payments over the lease term. The Company uses its estimated incremental borrowing rate based on the information available at commencement date in determining the present value of future payments. The operating lease ROU asset also includes any lease payments made and excludes lease incentives and initial direct costs incurred. The Company’s lease terms may include options to extend or terminate the lease when it is reasonably certain that the Company will exercise that option. Lease expense for minimum lease payments is recognized on a straight-line basis over the lease term. Leases with a term of 12 months or less are not recorded on the balance sheet. The Company’s lease agreements do not contain any residual value guarantees. The Company has lease agreements with lease and non-lease components. The Company accounts for the lease and non-lease components as a single lease component. |
Goodwill
Goodwill | 6 Months Ended |
Jun. 30, 2019 | |
Goodwill [Abstract] | |
Goodwill | 3. Goodwill During the first quarter of 2019, the Company reorganized the structure of the segments to separately disclose the Manufacturing entities that were acquired in the first quarter of 2018 and the Grow Tech segment, both of which were previously included in the Other category. The Company’s reporting units for goodwill are its operating segments, which are also its reportable segments. The following table presents goodwill allocated to the Company’s reportable segments for the periods ended June 30, 2019 and December 31, 2018 (U.S. dollars in thousands): June 30, 2019 December 31, 2018 Nu Skin Mainland China $ 32,179 $ 32,179 Americas/Pacific 9,449 9,449 South Korea 29,261 29,261 Southeast Asia 18,537 18,537 Japan 16,019 16,019 Hong Kong/Taiwan 6,634 6,634 EMEA 2,875 2,875 Manufacturing 72,469 72,469 Grow Tech 9,150 9,150 Total $ 196,573 $ 196,573 |
Debt
Debt | 6 Months Ended |
Jun. 30, 2019 | |
Debt [Abstract] | |
Debt | 4. Debt Previous Credit Agreement On October 9, 2014, the Company entered into a Credit Agreement (the “Previous Credit Agreement”) with various financial institutions as lenders, and Bank of America, N.A. as administrative agent. The Previous Credit Agreement provided for a $127.5 million term loan facility, a 6.6 billion Japanese yen term loan facility and a $187.5 million revolving credit facility, each with a term of five years. On October 10, 2014, the Company drew the full amount of the term loan facilities. On April 18, 2018, the Company repaid the full balance that was outstanding under the Previous Credit Agreement. Credit Agreement On April 18, 2018, the Company entered into a Credit Agreement (the “Credit Agreement”) with several financial institutions as lenders and Bank of America, N.A., as administrative agent. The Credit Agreement provides for a $400 million term loan facility and a $350 million revolving credit facility, each with a term of five years. Concurrently with the closing of the Credit Agreement, the Company drew the full amount of the term loan facility and $78.5 million of the revolving facility, each of which initially bear interest at the London Interbank Offered Rate (“LIBOR”), plus 2.25%. The interest rate applicable to the facilities is subject to adjustment based on the Company’s consolidated leverage ratio. The term loan facility amortizes in quarterly installments in amounts resulting in an annual amortization of 5.0% during the first and second years, 7.5% during the third and fourth years and 10.0% during the fifth year after the closing date of the Credit Agreement, with the remainder payable at final maturity. The Credit Agreement requires the Company to maintain a consolidated leverage ratio not exceeding 2.25 to 1.00 and a consolidated interest coverage ratio of no less than 3.00 to 1.00. As of June 30, 2019, the Company was in compliance with all covenants under the Credit Agreement. Convertible Note On June 16, 2016, the Company issued $210.0 million of convertible senior notes (the “Convertible Notes”) in a private offering to a Chinese investor (the “Holder”). The Convertible Notes were senior unsecured obligations which ranked equal in right of payment to all senior unsecured indebtedness of the Company and ranked senior in right of payment to any indebtedness that was contractually subordinated to the Convertible Notes. Interest on the Convertible Notes was payable semiannually in arrears on June 15 and December 15 of each year at a rate of 4.75% per annum. The Convertible Notes had a stated maturity date of June 15, 2020, unless repurchased or converted prior to maturity. Prior to the stated maturity date, the Company could, at its option, redeem all or part of the Convertible Notes at a price equal to 100% of the principal amount thereof, plus accrued and unpaid interest, if any, provided that its common stock share price was equal to or exceeded 180% of the applicable conversion price for 20 or more trading days (including the final three trading days) in the 30 consecutive trading days prior to the Company’s exercise of such redemption right. The Holder of the Convertible Notes could, at its option, cause the Company to repurchase all of such Holder’s Convertible Notes or any portion thereof that was equal to $1,000 in principal amount or multiples of $1,000 upon a change in control or a termination of trading of the Company’s common stock, as those terms were defined in the indenture governing the Convertible Notes. In addition, the Holder of the Convertible Notes had the right, at such Holder’s option, to convert all or any portion thereof that is equal to $1,000 in principal amount or multiples of $1,000 at any time beginning six calendar months following June 16, 2016, at the then-applicable conversion rate. Upon conversion by the Holder, the Convertible Notes would be settled in cash with respect to principal and any accrued and unpaid interest to such date and in the Company’s common shares with respect to any additional amounts, based on the applicable conversion rate at such time. The Convertible Notes had an initial conversion rate of 21.5054 common shares per $1,000 principal amount of the Convertible Notes (which was equal to an initial conversion price of approximately $46.50 per common share). Throughout the term of the Convertible Notes, the conversion rate could be adjusted upon the occurrence of certain specified events. Of the $210.0 million in proceeds received from the issuance of the Convertible Notes, $199.1 million was originally allocated to long-term debt (the “Liability Component”) and $10.9 million was allocated to additional paid-in capital (the “Equity Component”) within the Company’s consolidated balance sheets. The Liability Component was calculated by measuring the fair value of a similar debt instrument that does not have an associated conversion feature. The amount allocated to the Equity Component, representing the conversion option, was calculated by deducting the fair value of the Liability Component from the par value of the Convertible Notes. The Company determined that the conversion option did not require separate accounting treatment as a derivative instrument because it was both indexed to the Company’s own stock and would be classified in stockholders’ equity if freestanding. The Equity Component would not be remeasured as long as it continued to meet the conditions for equity classification. The excess of the principal amount of the Liability Component over its carrying amount (the “Debt Discount”) was amortized to interest expense over the term of the Convertible Notes. As a result, the Liability Component was accreted up to the Convertible Notes’ $210.0 million face value, resulting in additional non-cash interest expense being recognized within the Company’s consolidated statement of income. The effective interest rate on the Convertible Notes was approximately 7.1% per annum. The Company incurred approximately $6.6 million of issuance costs related to the issuance of the Convertible Notes. Of the $6.6 million in issuance costs incurred, $6.3 million and $0.3 million were recorded to deferred financing cost and additional paid-in capital, respectively, in proportion to the allocation of the proceeds of the Convertible Notes. The $6.3 million recorded to deferred financing cost on the Company’s consolidated balance sheets as a reduction of long-term debt was amortized over the contractual term of the Convertible Notes using the effective interest method. During the first quarter of 2018 the issuance costs were expensed due to the conversion of the Notes. During the first quarter of 2018, the Holder elected to convert the Convertible Notes pursuant to their terms in the indenture. The Company satisfied the equity portion of its conversion obligation on February 28, 2018 by issuing shares of the Company’s Class A common stock to the Holder and, on April 18, 2018, satisfied and discharged its obligations under the Convertible Notes and the indenture governing the Convertible Notes by paying the Holder $ million which included $ million of accrued interest from December 15, 2017 through April 17, 2018. The early conversion of the Convertible Notes resulted in a $ million charge to other income (expense) during the first quarter of 2018 for a loss on extinguishment of debt. The following table summarizes the Company’s debt facilities as of June 30, 2019 and December 31, 2018: Facility or Arrangement Original Principal Amount Balance as of June 30, 2019 (1)(2) Balance as of December 31, 2018 (2) Interest Rate Repayment Terms Credit Agreement term loan facility $ 400.0 million $ 375.0 million $ 385.0 million Variable 30 day: 4.15% 35% of the principal amount is payable in increasing quarterly installments over a five-year period that began on June 30, 2018, with the remainder payable at the end of the five-year term. Credit Agreement revolving credit facility $ 37.0 million $ 49.5 million Variable 30 day: 4.15% Revolving line of credit expires April 18, 2023. (1) As of June 30, 2019, the current portion of the Company’s debt (i.e. becoming due in the next 12 months) included $22.5 million of the balance of its term loan under the Credit Agreement. The Company has classified the $37.0 million borrowed under the revolving line of credit as current debt because it is the Company’s intention to use the line of credit to borrow and pay back funds over short periods of time. (2) The carrying value of the debt reflects the amounts stated in the above table less debt issuance costs of $3.5 million and $ million as of June 30, 2019 and December 31, 2018, respectively, related to the Credit Agreement, which are not reflected in this table. |
Leases
Leases | 6 Months Ended |
Jun. 30, 2019 | |
Leases [Abstract] | |
Leases | 5. Leases The Company has operating and finance leases for regional offices, manufacturing facilities, retail centers, distribution centers and certain equipment. The Company’s leases have remaining lease terms of 1 year to 15 years, some of which include options to extend the leases for up to 10 years, and some of which include options to terminate the leases within 1 year. As of June 30, 2019, the weighted average remaining lease term and weighted average discount rate for operating leases was 4.1 years and 4.8%. The Company has not separately disclosed finance leases, The components of lease expense were as follows (U.S. dollars in thousands): Three Months Ended June 30, 2019 Six Months Ended June 30, 2019 Operating lease cost $ 12,417 $ 25,278 Short-term lease cost 52 104 Variable lease cost 1,105 2,157 $ 13,574 $ 27,539 As of June 30, 2019, the Company had $118.5 million of operating right-of-use assets on the balance sheet, along with $37.2 million and $84.1 million of operating lease liabilities in accrued expenses and long-term operating lease liabilities, respectively. Supplemental cash flow information related to leases was as follows (U.S. dollars in thousands): Six Months Ended June 30, 2019 Operating cash outflow from operating leases $ 26,570 ROU assets obtained in exchange for lease obligations 140,585 Maturities of lease liabilities were as follows (U.S. dollars in thousands): Year Ending December 31, Operating leases 2019 $ 23,632 2020 37,424 2021 30,478 2022 16,439 2023 11,574 Thereafter 15,514 Total 135,061 Less: Finance charges 13,794 Total principal liability $ 121,267 The Company has additional lease liabilities of $0.2 million which have not yet commenced as of June 30, 2019, and as such, have not been recognized on the consolidated balance sheets. Under ASC Topic 840, minimum future operating leases and financing obligations at December 31, 2018 are as follows (U.S. dollars in thousands): Year Ending December 31, Operating leases Finance leases 2019 $ 39,358 $ 726 2020 27,553 748 2021 20,266 757 2022 11,723 770 2023 9,950 794 Thereafter 7,628 1,148 Total minimum lease payments $ 116,478 $ 4,943 |
Capital Stock
Capital Stock | 6 Months Ended |
Jun. 30, 2019 | |
Capital Stock [Abstract] | |
Capital Stock | 6. Capital Stock Net income per share is computed based on the weighted-average number of common shares outstanding during the periods presented. Additionally, diluted earnings per share data gives effect to all potentially dilutive common shares that were outstanding during the periods presented. For the three-month periods ended June 30, 2019 and 2018, stock options of 1.1 million and 0.3 million, respectively, and for the six-month periods ended June 30, 2019 and 2018, stock options of 1.1 million and 0.9 million, respectively, were excluded from the calculation of diluted earnings per share because they were anti-dilutive. Dividends In February and April 2019, the Company’s board of directors declared quarterly cash dividends of $0.37 per share. These quarterly cash dividends of $20.5 million and $20.6 million were paid on March 13, 2019, and June 12, 2019 to stockholders of record on February 25, 2019 and May 31, 2019. In August 2019, the Company’s board of directors declared a quarterly cash dividend of $0.37 per share to be paid on September 11, 2019 to stockholders of record on August 30, 2019. Repurchase of common stock During the three-month periods ended June 30, 2019 and 2018, the Company repurchased zero and 0.2 million shares of its Class A common stock under its stock repurchase plans for zero and $18.4 million, respectively. During the six-month periods ended June 30, 2019 and 2018, the Company repurchased 14,000 shares and 0.5 million shares of its Class A common stock under its stock repurchase plans for $0.8 million and $35.8 million, respectively. As of June 30, 2019, $470.2 million was available for repurchases under the Company’s stock repurchase plan. |
Fair Value
Fair Value | 6 Months Ended |
Jun. 30, 2019 | |
Fair Value [Abstract] | |
Fair Value | 7. Fair Value The carrying value of financial instruments including cash and cash equivalents, accounts receivable and accounts payable approximate fair values due to the short-term nature of these instruments. Fair value estimates are made at a specific point in time, based on relevant market information. The FASB Codification defines fair value as the price that would be received to sell an asset or paid to transfer a liability in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants at the measurement date. On a quarterly basis, the Company measures at fair value certain financial assets, including cash equivalents. Accounting standards specify a hierarchy of valuation techniques based on whether the inputs to those valuation techniques are observable or unobservable. Observable inputs reflect data obtained from independent sources, while unobservable inputs reflect the Company’s market assumptions. These two types of inputs have created the following fair-value hierarchy: ◾ Level 1 – quoted prices in active markets for identical assets or liabilities; ◾ Level 2 – inputs, other than the quoted prices in active markets, that are observable either directly or indirectly; ◾ Level 3 – unobservable inputs based on the Company’s own assumptions. Accounting standards permit companies, at their option, to measure certain financial instruments and other eligible items at fair value. The Company has elected not to apply the fair value option to existing eligible items beyond what is required by US GAAP. The following tables present the fair value hierarchy for those assets and liabilities measured at fair value on a recurring basis (U.S. dollars in thousands): Fair Value at June 30, 2019 Level 1 Level 2 Level 3 Total Financial assets (liabilities): Cash equivalents and current investments $ 37,082 $ — $ — $ 37,082 Other long-term assets 3,886 — — 3,886 Life insurance contracts — — 39,585 39,585 Total $ 40,968 $ — $ 39,585 $ 80,553 Fair Value at December 31, 2018 Level 1 Level 2 Level 3 Total Financial assets (liabilities): Cash equivalents and current investments $ 35,260 $ — $ — $ 35,260 Other long-term assets 3,568 — — 3,568 Life insurance contracts — — 35,590 35,590 Total $ 38,828 $ — $ 35,590 $ 74,418 The following table provides a summary of changes in fair value of the Company’s Level 3 marketable securities (U.S. dollars in thousands): Beginning balance at January 1, 2019 $ 35,590 Actual return on plan assets 3,566 Purchase and issuances 2,003 Sales and settlements (1,574 ) Transfers into Level 3 — Ending balance at June 30, 2019 $ 39,585 |
Income Taxes
Income Taxes | 6 Months Ended |
Jun. 30, 2019 | |
Income Taxes [Abstract] | |
Income Taxes | 8. Income Taxes Provision for income taxes for the three- and six-month periods of 2019 was $24.5 million and $47.3 million, compared to $20.6 million and $45.3 million for the prior-year periods. The effective tax rates for the three- and six-month periods was 34.6% of pre-tax book income, compared to 28.8% and 34.4% in the prior-year periods. The Company accounts for income taxes in accordance with ASC Topic 740 “Income Taxes.” These standards establish financial accounting and reporting standards for the effects of income taxes that result from an enterprise’s activities during the current and preceding years. The Company takes an asset and liability approach for financial accounting and reporting of income taxes. The Company pays income taxes in many foreign jurisdictions based on the profits realized in those jurisdictions, which can be significantly impacted by terms of intercompany transactions between the Company and its foreign affiliates. Deferred tax assets and liabilities are created in this process. The Company has netted these deferred tax assets and deferred tax liabilities by jurisdiction. Valuation allowances are established when necessary to reduce deferred tax assets to the amounts expected to be ultimately realized. The Company had net deferred tax assets of $14.8 million and $19.1 million as of June 30, 2019 and December 31, 2018, respectively. The Company evaluates its indefinite reinvestment assertions with respect to foreign earnings for each quarter. For all foreign earnings, the Company accrues the applicable foreign income taxes. For the earnings that have been indefinitely reinvested, the Company does not accrue foreign withholding taxes. Undistributed earnings that the Company has indefinitely reinvested, for which no foreign withholding taxes have been provided, aggregate to $60.0 million as of December 31, 2018. If the amount designated as indefinitely reinvested as of December 31, 2018 was repatriated to the United States, the amount of incremental taxes would be approximately $6.0 million. The Company intends to utilize the indefinitely reinvested offshore earnings to fund foreign investments, specifically capital expenditures. The Company files income tax returns in the U.S. federal jurisdiction, and in various state and foreign jurisdictions. The Company is no longer subject to tax examinations from the IRS for all years for which tax returns have been filed before 2015. With a few exceptions, the Company is no longer subject to state and local income tax examination by tax authorities for the years before 2015. In 2009, the Company entered into a voluntary program with the IRS called Compliance Assurance Process (“CAP”). The objective of CAP is to contemporaneously work with the IRS to achieve federal tax compliance and resolve all or most of the issues prior to filing of the tax return. The Company has elected to participate in the CAP program for 2019 and may elect to continue participating in CAP for future tax years; the Company may withdraw from the program at any time. In major foreign jurisdictions, the Company is generally no longer subject to income tax examinations for years before 2012. However, statutes of limitations in certain countries may be as long as ten years. The Company is currently under examination in certain foreign jurisdictions; however, the outcomes of those reviews are not yet determinable. The Company’s unrecognized tax benefits relate to multiple jurisdictions. Due to potential increases in unrecognized tax benefits from the multiple jurisdictions in which the Company operates, as well as the expiration of various statutes of limitations, it is reasonably possible that the Company’s gross unrecognized tax benefits, net of foreign currency adjustments, may increase in the next 12 months by approximately $0.5 to $1.5 million. |
Derivative Financial Instrument
Derivative Financial Instruments | 6 Months Ended |
Jun. 30, 2019 | |
Derivative Financial Instruments [Abstract] | |
Derivative Financial Instruments | 9. Derivative Financial Instruments The Company enters into non-designated foreign currency derivatives, primarily comprised of foreign currency forward contracts, for which hedge accounting does not apply. The changes in the fair market value of these non-designated derivatives are included in other income/expense in the Company’s consolidated statements of income. The Company at times uses non-designated foreign currency derivatives to hedge foreign-currency-denominated intercompany transactions and to partially mitigate the impact of foreign-currency fluctuations. The fair value of the non-designated foreign currency derivatives is based on third-party quotes. During the three- and six-month periods ended June 30, 2019 and 2018, the Company had no gains (losses) related to derivative instruments not designated as hedging instruments. The Company designates as cash-flow hedges those foreign currency forward contracts it enters to hedge forecasted intercompany transactions that are subject to foreign currency exposures. Changes in the fair value of these forward contracts designated as cash-flow hedges are recorded as a component of accumulated other comprehensive loss within stockholders’ equity (deficit) and are recognized in the consolidated statement of income during the period which approximates the time the hedged transaction is settled. As of June 30, 2019, and 2018, the Company held no forward contracts designated as foreign currency cash flow hedges. The following table summarizes gains (losses) related to derivative instruments recorded in other comprehensive income (loss) during the three- and six-month periods ended June 30, 2019 and 2018 (U.S. dollars in thousands): Amount of Gain (Loss) Recognized in Other Comprehensive Loss Derivatives Designated Three Months Ended June 30, Six Months Ended June 30, as Hedging Instruments: 2019 2018 2019 2018 Foreign currency forward contracts related to intercompany license fee, product sales, and selling expense hedges $ — $ 87 $ — $ (160 ) The following table summarizes gains (losses) relating to derivative instruments reclassified from accumulated other comprehensive loss into income during the three- and six-month periods ended June 30, 2019 and 2018 (U.S. dollars in thousands): Amount of Gain (Loss) Reclassified from Accumulated Other Comprehensive Loss into Income Derivatives Designated Location of Gain (Loss) Reclassified from Accumulated Three Months Ended June 30, Six Months Ended June 30, as Hedging Instruments: Other Comprehensive Loss into Income 2019 2018 2019 2018 Foreign currency forward contracts related to intercompany license fees and product sales hedges Revenue $ — $ (26 ) $ — $ 18 As of June 30, 2019 and December 31, 2018, there were no unrealized gains/(losses) included in accumulated other comprehensive loss related to foreign currency cash flow hedges. The remaining $81.3 million and $79.9 million as of June 30, 2019 and December 31, 2018, respectively, in accumulated other comprehensive loss are related to cumulative translation adjustments. The Company assesses hedge effectiveness at least quarterly. During the three- and six-month periods ended June 30, 2019 and 2018, all hedges were determined to be effective. The Company reports its derivatives at fair value as either other current assets or accrued expenses within its consolidated balance sheets. See Note 7 - Fair Value. |
Segment Information
Segment Information | 6 Months Ended |
Jun. 30, 2019 | |
Segment Information [Abstract] | |
Segment Information | 10. Segment Information The Company reports revenue from nine segments, consisting of its seven geographic Nu Skin segments—Mainland China, South Korea, Southeast Asia, Americas/Pacific, Japan, Hong Kong/Taiwan, and EMEA—and its Manufacturing and Grow Tech segments, which the Company decided to disclose separately beginning in the first quarter of 2019. Previously, these latter two segments were included in the Other category. The Other category includes miscellaneous corporate revenue and related adjustments. These segments reflect the way the chief operating decision maker evaluates the Company’s business performance and allocates resources. Reported revenue includes only the revenue generated by sales to external customers. Segment information for the three- and six-month periods ended June 30, 2018 has been recast to reflect the separate disclosure of the Manufacturing and Grow Tech segments, both of which were previously included in the Other category. Consolidated financial information is not affected. Profitability by segment as determined under US GAAP is driven primarily by the Company’s transfer pricing policies. Segment contribution, which is the Company’s segment profitability metric presented in the table below, excludes certain intercompany charges, specifically royalties, license fees, transfer pricing, discrete charges and other miscellaneous items. These charges have been included in Corporate and other expenses. Corporate and other expenses also include costs related to the Company’s executive and administrative offices, information technology, research and development, and marketing and supply chain functions not recorded at the segment level. The accounting policies of the segments are the same as those described in Note 2 – Summary of Significant Accounting Policies. The Company evaluates the performance of its segments based on revenue and segment contribution. Each segment records direct expenses related to its employees and its operations. Summarized financial information for the Company’s reportable segments is shown in the following tables. Asset information is not reviewed or included with the Company’s internal management reporting. Therefore, the Company has not disclosed asset information for each reportable segment. Revenue by Segment Three Months Ended June 30, Six Months Ended June 30, (U.S. dollars in thousands) 2019 2018 2019 2018 Nu Skin Mainland China $ 185,333 $ 245,256 $ 393,821 $ 442,787 Americas/Pacific 92,841 103,990 179,297 196,279 South Korea 84,732 91,624 168,585 180,554 Southeast Asia 75,395 79,223 147,890 150,083 Japan 65,251 64,113 127,360 127,337 Hong Kong/Taiwan 43,712 52,206 84,270 93,198 EMEA 43,400 44,010 85,218 88,991 Other 1,249 1,030 (177 ) 1,265 Total Nu Skin 591,913 681,452 1,186,264 1,280,494 Manufacturing (1) 31,557 22,738 60,829 39,915 Grow Tech 30 — 30 — Total $ 623,500 $ 704,190 $ 1,247,123 $ 1,320,409 (1) The Manufacturing segment had $6.5 million and $6.6 million of intersegment revenue for the three-month period ended June 30, 2019 and 2018, respectively, and $12.4 million and $9.8 million. for the first half of 2019 and 2018, respectively. Intersegment revenue is eliminated in the consolidated financial statements, as well as the reported segment revenue in the table above. Segment Contribution Three Months Ended June 30, Six Months Ended June 30, (U.S. dollars in thousands) 2019 2018 2019 2018 Nu Skin Mainland China $ 51,087 $ 73,899 $ 110,254 $ 118,716 Americas/Pacific 16,420 17,068 28,439 26,240 South Korea 25,979 24,880 51,647 51,081 Southeast Asia 20,840 20,639 38,832 37,041 Japan 15,823 13,377 29,929 26,615 Hong Kong/Taiwan 9,217 7,835 16,691 15,681 EMEA 3,234 3,069 4,585 7,823 Nu Skin contribution 142,600 160,767 280,377 283,197 Manufacturing 3,375 2,348 7,021 1,994 Grow Tech (4,582 ) (2,057 ) (8,211 ) (3,317 ) Total segment contribution 141,393 161,058 279,187 281,874 Corporate and other (67,191 ) (78,294 ) (136,332 ) (140,120 ) Operating income 74,202 82,764 142,855 141,754 Other income (expense) (3,326 ) (11,165 ) (6,174 ) (9,958 ) Income before provision for income taxes $ 70,876 $ 71,599 $ 136,681 $ 131,796 Depreciation and Amortization Three Months Ended June 30, Six Months Ended June 30, (U.S. dollars in thousands) 2019 2018 2019 2018 Nu Skin Mainland China $ 2,909 $ 3,444 $ 6,025 $ 6,931 Americas/Pacific 206 279 420 493 South Korea 1,358 1,576 2,882 3,243 Southeast Asia 462 564 939 1,123 Japan 957 900 2,005 1,815 Hong Kong/Taiwan 537 321 1,053 644 EMEA 272 175 712 351 Total Nu Skin 6,701 7,259 14,036 14,600 Manufacturing 1,631 2,821 3,205 5,646 Grow Tech 945 228 1,820 446 Corporate and other 9,775 10,927 19,598 19,450 Total $ 19,052 $ 21,235 $ 38,659 $ 40,142 Capital Expenditures Three Months Ended June 30, Six Months Ended June 30, (U.S. dollars in thousands) 2019 2018 2019 2018 Nu Skin Mainland China $ 1,033 $ 1,029 $ 2,714 $ 2,898 Americas/Pacific 473 240 747 429 South Korea 30 44 79 44 Southeast Asia 225 144 319 195 Japan 946 72 1,118 383 Hong Kong/Taiwan 1,091 116 1,554 598 EMEA 42 42 76 77 Total Nu Skin 3,840 1,687 6,607 4,624 Manufacturing 1,579 719 3,181 1,468 Grow Tech 2,066 5,735 5,051 8,322 Corporate and other 7,964 7,636 14,375 14,015 Total $ 15,449 $ 15,777 $ 29,214 $ 28,429 |
Commitments and Contingencies
Commitments and Contingencies | 6 Months Ended |
Jun. 30, 2019 | |
Commitments and Contingencies [Abstract] | |
Commitments and Contingencies | 11. Commitments and Contingencies The Company is subject to government regulations pertaining to product formulation, labeling and packaging, product claims and advertising, and the Company’s direct selling system. The Company is also subject to the jurisdiction of numerous foreign tax and customs authorities. Any assertions or determination that either the Company or the Company’s sales force is not in compliance with existing statutes, laws, rules or regulations could have a material adverse effect on the Company’s operations. In addition, in any country or jurisdiction, the adoption of new statutes, laws, rules or regulations or changes in the interpretation of existing statutes, laws, rules or regulations could have a material adverse effect on the Company and its operations. No assurance can be given that the Company’s compliance with applicable statutes, laws, rules and regulations will not be challenged by foreign authorities or that such challenges will not have a material adverse effect on the Company’s financial position, results of operations or cash flows. The Company and its Subsidiaries are defendants in litigation, investigations and other proceedings involving various matters. In the opinion of the Company’s management, based on management’s evaluation of the matters and the advice of its counsel handling such litigation, investigations and other proceedings, adverse outcomes, if any, are not currently expected to result in a material effect on the Company’s consolidated financial condition, results of operations or cash flows. The Company is subject to regular audits by federal, state and foreign tax authorities. These audits may result in additional tax liabilities. The Company believes it has appropriately provided for income taxes for all years. Several factors drive the calculation of its tax reserves. Some of these factors include: (i) the expiration of various statutes of limitations; (ii) changes in tax law and regulations; (iii) issuance of tax rulings; and (iv) settlements with tax authorities. Changes in any of these factors may result in adjustments to the Company’s reserves, which would impact its reported financial results. |
Acquisitions
Acquisitions | 6 Months Ended |
Jun. 30, 2019 | |
Acquisitions [Abstract] | |
Acquisitions | 12. Acquisitions On January 22, 2018, the Company acquired the remaining 73% ownership in Innuvate Health Sciences, LLC (“Innuvate”), which owns a 92% interest in a nutritional product manufacturer. Innuvate is a contract manufacturer that specializes in softgel and hardshell capsule manufacturing. Prior to this acquisition, the Company owned 27% of Innuvate and accounted for it using the equity method. Following the January 22, 2018 acquisition, the remaining 8% ownership in the manufacturer continues to be held by an unrelated third party. Under the terms of the agreement, the Company paid $23.5 million in cash and shares of the Company in exchange for the 73% ownership in Innuvate. On February 12, 2018, the Company acquired the remaining 65% ownership in Treviso, LLC (“Treviso”), making Treviso a wholly owned subsidiary of the Company. Treviso is a liquid contract manufacturing laboratory for premium personal care products. Prior to this acquisition, the Company owned 35% of Treviso and accounted for it using the equity method. Under the terms of the purchase agreement, the Company paid $83.9 million in cash and shares of the Company in exchange for the 65% ownership in Treviso. On February 12, 2018, the Company acquired 100% ownership in L&W Holdings, Inc. (“L&W”) making L&W a wholly owned subsidiary of the Company. L&W is a packaging supplier company that specializes in the distribution and packaging of products in the cosmetic and nutritional industries. Under the terms of the purchase agreement, the Company paid $25.0 million in shares of the Company in exchange for 100% ownership in L&W. The allocation of the fair value of assets acquired and liabilities assumed for the acquisitions of Innuvate, Treviso and L&W were finalized during the year ended December 31, 2018, resulting in goodwill of $17.2 million, $42.5 million and $12.8 million, respectively. There were no significant adjustments to the allocation of the fair value of assets acquired and liabilities assumed for the acquisitions of Innuvate, Treviso or L&W from those disclosed in the Company’s Annual Report on Form 10-K for the year ended December 31, 2018. |
Restructuring
Restructuring | 6 Months Ended |
Jun. 30, 2019 | |
Restructuring [Abstract] | |
Restructuring | 13. Restructuring In the fourth quarter of 2018, the Company began a strategic plan to align its resources and capabilities to support its vision of being a world-leading business platform. This program primarily impacted the Company’s information technology infrastructure and organization and other departments within its corporate and Americas offices. As a result of the restructuring program, the Company recorded a non-cash charge of $ million for impairment of information technology assets, including internally developed software for social sharing and digital initiatives, and $ million of cash charges, including $ million for employee severance and $ million for other related cash charges with the restructuring. The restructuring charges were predominately recorded in the Corporate and Other category. See the table below for detail of restructuring activity for the three months ended March 31, 2019 (U.S. dollars in thousands): Beginning balance at January 1, 2019 $ 15,462 Amounts paid (15,046 ) Adjustments (416 ) Ending balance at March 31, 2019 $ — There was no restructuring activity for the three months ended June 30, 2019. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 6 Months Ended |
Jun. 30, 2019 | |
Summary of Significant Accounting Policies [Abstract] | |
Basis of Accounting | The accompanying unaudited consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“US GAAP”) for interim financial information and with the instructions to Form 10-Q and Rule 10-01 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by US GAAP for complete financial statements. The unaudited consolidated financial statements include the accounts of the Company and its Subsidiaries. All significant intercompany accounts and transactions are eliminated in consolidation. In the opinion of management, the accompanying unaudited consolidated financial statements contain all adjustments, consisting of normal recurring adjustments, considered necessary for a fair statement of the Company’s financial information as of June 30, 2019, and for the three- and six month periods ended June 30, 2019 and 2018. The results of operations of any interim period are not necessarily indicative of the results of operations to be expected for the fiscal year. The consolidated balance sheet as of December 31, 2018 has been prepared using information from the audited financial statements at that date. For further information, refer to the consolidated financial statements and accompanying footnotes included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2018. |
Accounting Pronouncements | Accounting Pronouncements In February 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standard Update (“ASU”) 2016-02, Leases In January 2017, the FASB issued ASU 2017-04, Intangibles – Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment . This guidance simplifies the required test of goodwill for impairment by eliminating Step 2 from the goodwill impairment test. If a company determines in Step 1 of the goodwill impairment test that the carrying value of a reporting unit is less than the fair value, an impairment in that amount should be recorded to the income statement, rather than proceeding to Step 2. This ASU is effective for interim and annual impairment tests in fiscal years beginning after December 15, 2019, and early adoption is permitted. The Company elected to early adopt the new standard effective January 1, 2019. The adoption of this guidance did not have a material impact on the Company’s consolidated financial statements. In December 2017, the FASB issued ASU 2017-12, Derivatives and Hedging (Topic 815): Targeted Improvements to Accounting for Hedging Activities This ASU was effective for the Company beginning on January 1, 2019. The adoption of this guidance did not have a material impact on the Company’s consolidated financial statements. In August 2018, the FASB issued ASU 2018-13, Fair Value Measurement (Topic 820): Disclosure Framework - Changes to the Disclosure Requirements for Fair Value Measurement. In August 2018, the FASB issued ASU 2018-15, Intangibles-Goodwill and Other-Internal-Use Software Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That is a Service Contract |
Inventory | Inventory Inventories consist of the following (U.S. dollars in thousands): June 30, 2019 December 31, 2018 Raw materials $ 92,768 $ 91,610 Finished goods 199,928 204,211 Total Inventory, net $ 292,696 $ 295,821 |
Revenue Recognition | Revenue Recognition Adoption of ASC Topic 606, “Revenue from Contracts with Customers” On January 1, 2018, the Company adopted Topic 606 using the modified retrospective method applied to those contracts which were not completed as of January 1, 2018. Results for reporting periods beginning after January 1, 2018 are presented under Topic 606, while prior period amounts are not adjusted and continue to be reported in accordance with historic accounting under Topic 605. The Company recorded a net reduction to opening retained earnings of $13.0 million, net of tax, as of January 1, 2018 due to the cumulative impact of adopting Topic 606, with the impact primarily related to the Company’s loyalty point program deferrals. The impact to revenues as a result of applying Topic 606 for the three-month periods ended June 30, 2019, and 2018 was an increase of $0.6 million and a decrease of $0.7 million, respectively. The impact to revenue for the six-month periods ended June 30, 2019, and 2018 was an increase of $ million and $ million, respectively. Revenue Recognition Net sales include products and shipping and handling charges, net of estimates for product returns and any related sales incentives. Revenue is measured as the amount of consideration the Company expects to receive in exchange for transferring products. All revenue is recognized when the Company satisfies the performance obligations under the contract. The Company recognizes revenue by transferring the promised products to the customer, with revenue recognized at shipping point, the point in time the customer obtains control of the products. The Company recognizes revenue for shipping and handling charges at the time the products are delivered to or picked up by the customer. The Company estimates product returns based on historical return rates. The majority of the Company’s contracts have a single performance obligation and are short term in nature. Sales taxes and value added taxes in foreign jurisdictions that are collected from customers and remitted to governmental authorities are accounted for on a net basis and therefore are excluded from net sales. Contract Liabilities – Customer Loyalty Programs Contract liabilities, recorded as deferred revenue within the accrued expenses line in the consolidated balance sheets, include loyalty point program deferrals with certain customers which are accounted for as a reduction in the transaction price and are generally recognized as points are redeemed for additional products on an annual basis. The balance of deferred revenue related to contract liabilities as of $ million and Disaggregation of Revenue Please refer to Note 10 - Segment Information for revenue by segment. Arrangements with Multiple Performance Obligations The Company’s contracts with customers may include multiple performance obligations. For such arrangements, the Company allocates revenues to each performance obligation based on its relative standalone selling price. The Company generally determines standalone selling prices based on the prices charged to customers for individual products sales to customers. Practical Expedients and Exemptions The Company generally expenses sales commissions when incurred because the amortization period would have been one year or less. These costs are recorded within selling expenses. The Company does not disclose the value of unsatisfied performance obligations for contracts with an original expected length of one year or less. |
Leases | Leases The Company determines if an arrangement is a lease at inception. Operating leases are included in right-of-use (“ROU”) assets, accrued expenses and operating lease liabilities on the consolidated balance sheets. The Company has not separately disclosed finance leases, Operating lease ROU assets represent the Company’s right to use an underlying asset for the lease term and lease liabilities represent the Company’s obligation to make lease payments arising from the lease. ROU assets and lease liabilities are recognized at the lease commencement date based on the estimated present value of lease payments over the lease term. The Company uses its estimated incremental borrowing rate based on the information available at commencement date in determining the present value of future payments. The operating lease ROU asset also includes any lease payments made and excludes lease incentives and initial direct costs incurred. The Company’s lease terms may include options to extend or terminate the lease when it is reasonably certain that the Company will exercise that option. Lease expense for minimum lease payments is recognized on a straight-line basis over the lease term. Leases with a term of 12 months or less are not recorded on the balance sheet. The Company’s lease agreements do not contain any residual value guarantees. The Company has lease agreements with lease and non-lease components. The Company accounts for the lease and non-lease components as a single lease component. |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Summary of Significant Accounting Policies [Abstract] | |
Inventories | Inventories consist of the following (U.S. dollars in thousands): June 30, 2019 December 31, 2018 Raw materials $ 92,768 $ 91,610 Finished goods 199,928 204,211 Total Inventory, net $ 292,696 $ 295,821 |
Goodwill (Tables)
Goodwill (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Goodwill [Abstract] | |
Goodwill | The following table presents goodwill allocated to the Company’s reportable segments for the periods ended June 30, 2019 and December 31, 2018 (U.S. dollars in thousands): June 30, 2019 December 31, 2018 Nu Skin Mainland China $ 32,179 $ 32,179 Americas/Pacific 9,449 9,449 South Korea 29,261 29,261 Southeast Asia 18,537 18,537 Japan 16,019 16,019 Hong Kong/Taiwan 6,634 6,634 EMEA 2,875 2,875 Manufacturing 72,469 72,469 Grow Tech 9,150 9,150 Total $ 196,573 $ 196,573 |
Debt (Tables)
Debt (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Debt [Abstract] | |
Debt Facilities | The following table summarizes the Company’s debt facilities as of June 30, 2019 and December 31, 2018: Facility or Arrangement Original Principal Amount Balance as of June 30, 2019 (1)(2) Balance as of December 31, 2018 (2) Interest Rate Repayment Terms Credit Agreement term loan facility $ 400.0 million $ 375.0 million $ 385.0 million Variable 30 day: 4.15% 35% of the principal amount is payable in increasing quarterly installments over a five-year period that began on June 30, 2018, with the remainder payable at the end of the five-year term. Credit Agreement revolving credit facility $ 37.0 million $ 49.5 million Variable 30 day: 4.15% Revolving line of credit expires April 18, 2023. (1) As of June 30, 2019, the current portion of the Company’s debt (i.e. becoming due in the next 12 months) included $22.5 million of the balance of its term loan under the Credit Agreement. The Company has classified the $37.0 million borrowed under the revolving line of credit as current debt because it is the Company’s intention to use the line of credit to borrow and pay back funds over short periods of time. (2) The carrying value of the debt reflects the amounts stated in the above table less debt issuance costs of $3.5 million and $ million as of June 30, 2019 and December 31, 2018, respectively, related to the Credit Agreement, which are not reflected in this table. |
Leases (Tables)
Leases (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Leases [Abstract] | |
Components of Lease Expense | The components of lease expense were as follows (U.S. dollars in thousands): Three Months Ended June 30, 2019 Six Months Ended June 30, 2019 Operating lease cost $ 12,417 $ 25,278 Short-term lease cost 52 104 Variable lease cost 1,105 2,157 $ 13,574 $ 27,539 |
Supplemental Cash Flow Information Related to Leases | Supplemental cash flow information related to leases was as follows (U.S. dollars in thousands): Six Months Ended June 30, 2019 Operating cash outflow from operating leases $ 26,570 ROU assets obtained in exchange for lease obligations 140,585 |
Maturities of Operating Lease Liabilities | Maturities of lease liabilities were as follows (U.S. dollars in thousands): Year Ending December 31, Operating leases 2019 $ 23,632 2020 37,424 2021 30,478 2022 16,439 2023 11,574 Thereafter 15,514 Total 135,061 Less: Finance charges 13,794 Total principal liability $ 121,267 |
Minimum Future Operating Leases and Financing Obligations | Under ASC Topic 840, minimum future operating leases and financing obligations at December 31, 2018 are as follows (U.S. dollars in thousands): Year Ending December 31, Operating leases Finance leases 2019 $ 39,358 $ 726 2020 27,553 748 2021 20,266 757 2022 11,723 770 2023 9,950 794 Thereafter 7,628 1,148 Total minimum lease payments $ 116,478 $ 4,943 |
Fair Value (Tables)
Fair Value (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Fair Value [Abstract] | |
Assets and Liabilities Measured at Fair Value on a Recurring Basis | The following tables present the fair value hierarchy for those assets and liabilities measured at fair value on a recurring basis (U.S. dollars in thousands): Fair Value at June 30, 2019 Level 1 Level 2 Level 3 Total Financial assets (liabilities): Cash equivalents and current investments $ 37,082 $ — $ — $ 37,082 Other long-term assets 3,886 — — 3,886 Life insurance contracts — — 39,585 39,585 Total $ 40,968 $ — $ 39,585 $ 80,553 Fair Value at December 31, 2018 Level 1 Level 2 Level 3 Total Financial assets (liabilities): Cash equivalents and current investments $ 35,260 $ — $ — $ 35,260 Other long-term assets 3,568 — — 3,568 Life insurance contracts — — 35,590 35,590 Total $ 38,828 $ — $ 35,590 $ 74,418 |
Changes in Fair Value of Level 3 Marketable Securities | The following table provides a summary of changes in fair value of the Company’s Level 3 marketable securities (U.S. dollars in thousands): Beginning balance at January 1, 2019 $ 35,590 Actual return on plan assets 3,566 Purchase and issuances 2,003 Sales and settlements (1,574 ) Transfers into Level 3 — Ending balance at June 30, 2019 $ 39,585 |
Derivative Financial Instrume_2
Derivative Financial Instruments (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Derivative Financial Instruments [Abstract] | |
Gains (Losses) Related to Derivative Instruments Designated as Cash Flow Hedges | The following table summarizes gains (losses) related to derivative instruments recorded in other comprehensive income (loss) during the three- and six-month periods ended June 30, 2019 and 2018 (U.S. dollars in thousands): Amount of Gain (Loss) Recognized in Other Comprehensive Loss Derivatives Designated Three Months Ended June 30, Six Months Ended June 30, as Hedging Instruments: 2019 2018 2019 2018 Foreign currency forward contracts related to intercompany license fee, product sales, and selling expense hedges $ — $ 87 $ — $ (160 ) The following table summarizes gains (losses) relating to derivative instruments reclassified from accumulated other comprehensive loss into income during the three- and six-month periods ended June 30, 2019 and 2018 (U.S. dollars in thousands): Amount of Gain (Loss) Reclassified from Accumulated Other Comprehensive Loss into Income Derivatives Designated Location of Gain (Loss) Reclassified from Accumulated Three Months Ended June 30, Six Months Ended June 30, as Hedging Instruments: Other Comprehensive Loss into Income 2019 2018 2019 2018 Foreign currency forward contracts related to intercompany license fees and product sales hedges Revenue $ — $ (26 ) $ — $ 18 |
Segment Information (Tables)
Segment Information (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Segment Information [Abstract] | |
Revenue by Segment | Revenue by Segment Three Months Ended June 30, Six Months Ended June 30, (U.S. dollars in thousands) 2019 2018 2019 2018 Nu Skin Mainland China $ 185,333 $ 245,256 $ 393,821 $ 442,787 Americas/Pacific 92,841 103,990 179,297 196,279 South Korea 84,732 91,624 168,585 180,554 Southeast Asia 75,395 79,223 147,890 150,083 Japan 65,251 64,113 127,360 127,337 Hong Kong/Taiwan 43,712 52,206 84,270 93,198 EMEA 43,400 44,010 85,218 88,991 Other 1,249 1,030 (177 ) 1,265 Total Nu Skin 591,913 681,452 1,186,264 1,280,494 Manufacturing (1) 31,557 22,738 60,829 39,915 Grow Tech 30 — 30 — Total $ 623,500 $ 704,190 $ 1,247,123 $ 1,320,409 (1) The Manufacturing segment had $6.5 million and $6.6 million of intersegment revenue for the three-month period ended June 30, 2019 and 2018, respectively, and $12.4 million and $9.8 million. for the first half of 2019 and 2018, respectively. Intersegment revenue is eliminated in the consolidated financial statements, as well as the reported segment revenue in the table above. |
Segment Contribution | Segment Contribution Three Months Ended June 30, Six Months Ended June 30, (U.S. dollars in thousands) 2019 2018 2019 2018 Nu Skin Mainland China $ 51,087 $ 73,899 $ 110,254 $ 118,716 Americas/Pacific 16,420 17,068 28,439 26,240 South Korea 25,979 24,880 51,647 51,081 Southeast Asia 20,840 20,639 38,832 37,041 Japan 15,823 13,377 29,929 26,615 Hong Kong/Taiwan 9,217 7,835 16,691 15,681 EMEA 3,234 3,069 4,585 7,823 Nu Skin contribution 142,600 160,767 280,377 283,197 Manufacturing 3,375 2,348 7,021 1,994 Grow Tech (4,582 ) (2,057 ) (8,211 ) (3,317 ) Total segment contribution 141,393 161,058 279,187 281,874 Corporate and other (67,191 ) (78,294 ) (136,332 ) (140,120 ) Operating income 74,202 82,764 142,855 141,754 Other income (expense) (3,326 ) (11,165 ) (6,174 ) (9,958 ) Income before provision for income taxes $ 70,876 $ 71,599 $ 136,681 $ 131,796 |
Depreciation and Amortization and Capital Expenditures | Depreciation and Amortization Three Months Ended June 30, Six Months Ended June 30, (U.S. dollars in thousands) 2019 2018 2019 2018 Nu Skin Mainland China $ 2,909 $ 3,444 $ 6,025 $ 6,931 Americas/Pacific 206 279 420 493 South Korea 1,358 1,576 2,882 3,243 Southeast Asia 462 564 939 1,123 Japan 957 900 2,005 1,815 Hong Kong/Taiwan 537 321 1,053 644 EMEA 272 175 712 351 Total Nu Skin 6,701 7,259 14,036 14,600 Manufacturing 1,631 2,821 3,205 5,646 Grow Tech 945 228 1,820 446 Corporate and other 9,775 10,927 19,598 19,450 Total $ 19,052 $ 21,235 $ 38,659 $ 40,142 Capital Expenditures Three Months Ended June 30, Six Months Ended June 30, (U.S. dollars in thousands) 2019 2018 2019 2018 Nu Skin Mainland China $ 1,033 $ 1,029 $ 2,714 $ 2,898 Americas/Pacific 473 240 747 429 South Korea 30 44 79 44 Southeast Asia 225 144 319 195 Japan 946 72 1,118 383 Hong Kong/Taiwan 1,091 116 1,554 598 EMEA 42 42 76 77 Total Nu Skin 3,840 1,687 6,607 4,624 Manufacturing 1,579 719 3,181 1,468 Grow Tech 2,066 5,735 5,051 8,322 Corporate and other 7,964 7,636 14,375 14,015 Total $ 15,449 $ 15,777 $ 29,214 $ 28,429 |
Restructuring (Tables)
Restructuring (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Restructuring [Abstract] | |
Restructuring Activity | See the table below for detail of restructuring activity for the three months ended March 31, 2019 (U.S. dollars in thousands): Beginning balance at January 1, 2019 $ 15,462 Amounts paid (15,046 ) Adjustments (416 ) Ending balance at March 31, 2019 $ — |
The Company (Details)
The Company (Details) | 6 Months Ended |
Jun. 30, 2019Segment | |
The Company [Abstract] | |
Number of reportable segments | 9 |
Number of geographic segments | 7 |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies, Accounting Pronouncements (Details) - USD ($) $ in Millions | Dec. 31, 2018 | Dec. 31, 2017 |
ASU 2014-09 [Member] | ||
Accounting Pronouncements [Abstract] | ||
Cumulative impact on opening retained earnings | $ 13 | |
ASU 2016-02 [Member] | ||
Accounting Pronouncements [Abstract] | ||
Cumulative impact on opening retained earnings | $ 0.7 |
Summary of Significant Accoun_5
Summary of Significant Accounting Policies, Inventory (Details) - USD ($) $ in Thousands | Jun. 30, 2019 | Dec. 31, 2018 |
Inventories [Abstract] | ||
Raw materials | $ 92,768 | $ 91,610 |
Finished goods | 199,928 | 204,211 |
Total Inventory, net | $ 292,696 | $ 295,821 |
Summary of Significant Accoun_6
Summary of Significant Accounting Policies, Revenue Recognition (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | Dec. 31, 2017 | |
Revenue Recognition [Abstract] | |||||
Revenue | $ 623,500 | $ 704,190 | $ 1,247,123 | $ 1,320,409 | |
ASC Topic 606 [Member] | |||||
Revenue Recognition [Abstract] | |||||
Cumulative impact on opening retained earnings | $ 13,000 | ||||
Impact of Adopting ASC Topic 606 [Member] | ASC Topic 606 [Member] | |||||
Revenue Recognition [Abstract] | |||||
Revenue | $ 600 | $ (700) | $ 1,100 | $ 600 |
Summary of Significant Accoun_7
Summary of Significant Accounting Policies, Contract Liabilities - Customer Loyalty Programs (Details) - USD ($) $ in Millions | Jun. 30, 2019 | Dec. 31, 2018 |
Contract Liabilities - Customer Loyalty Programs [Abstract] | ||
Contract liabilities for customer loyalty programs | $ 12.7 | $ 13.8 |
Goodwill (Details)
Goodwill (Details) - USD ($) $ in Thousands | Jun. 30, 2019 | Dec. 31, 2018 |
Goodwill [Abstract] | ||
Goodwill | $ 196,573 | $ 196,573 |
Manufacturing [Member] | ||
Goodwill [Abstract] | ||
Goodwill | 72,469 | 72,469 |
Grow Tech [Member] | ||
Goodwill [Abstract] | ||
Goodwill | 9,150 | 9,150 |
Mainland China [Member] | ||
Goodwill [Abstract] | ||
Goodwill | 32,179 | 32,179 |
Americas/Pacific [Member] | ||
Goodwill [Abstract] | ||
Goodwill | 9,449 | 9,449 |
South Korea [Member] | ||
Goodwill [Abstract] | ||
Goodwill | 29,261 | 29,261 |
Southeast Asia [Member] | ||
Goodwill [Abstract] | ||
Goodwill | 18,537 | 18,537 |
Japan [Member] | ||
Goodwill [Abstract] | ||
Goodwill | 16,019 | 16,019 |
Hong Kong/Taiwan [Member] | ||
Goodwill [Abstract] | ||
Goodwill | 6,634 | 6,634 |
EMEA [Member] | ||
Goodwill [Abstract] | ||
Goodwill | $ 2,875 | $ 2,875 |
Debt, Previous Credit Agreement
Debt, Previous Credit Agreement (Details) $ in Millions, ¥ in Billions | 6 Months Ended | ||
Jun. 30, 2019 | Oct. 09, 2014USD ($) | Oct. 09, 2014JPY (¥) | |
Term Loan Facility [Member] | |||
Debt [Abstract] | |||
Original principal amount | $ 127.5 | ||
Term of loan | 5 years | ||
Japanese Yen Term Loan Facility [Member] | |||
Debt [Abstract] | |||
Original principal amount | ¥ | ¥ 6.6 | ||
Term of loan | 5 years | ||
Revolving Credit Facility [Member] | |||
Debt [Abstract] | |||
Borrowing capacity | $ 187.5 | ||
Term of loan | 5 years |
Debt, Credit Agreement (Details
Debt, Credit Agreement (Details) - USD ($) $ in Thousands | Apr. 18, 2018 | Jun. 30, 2019 | Jun. 30, 2018 |
Debt [Abstract] | |||
Proceeds from debt | $ 130,000 | $ 582,398 | |
Credit Agreement [Member] | Maximum [Member] | |||
Debt [Abstract] | |||
Consolidated leverage ratio | 2.25 | ||
Credit Agreement [Member] | Minimum [Member] | |||
Debt [Abstract] | |||
Consolidated interest coverage ratio | 3 | ||
Term Loan Facility [Member] | |||
Debt [Abstract] | |||
Original principal amount | $ 400,000 | $ 400,000 | |
Term of loan | 5 years | ||
Term Loan Facility [Member] | First Year [Member] | |||
Debt [Abstract] | |||
Annual amortization percentage | 5.00% | ||
Term Loan Facility [Member] | Second Year [Member] | |||
Debt [Abstract] | |||
Annual amortization percentage | 5.00% | ||
Term Loan Facility [Member] | Third Year [Member] | |||
Debt [Abstract] | |||
Annual amortization percentage | 7.50% | ||
Term Loan Facility [Member] | Fourth Year [Member] | |||
Debt [Abstract] | |||
Annual amortization percentage | 7.50% | ||
Term Loan Facility [Member] | Fifth Year [Member] | |||
Debt [Abstract] | |||
Annual amortization percentage | 10.00% | ||
Term Loan Facility [Member] | LIBOR [Member] | |||
Debt [Abstract] | |||
Basis spread on variable rate | 2.25% | ||
Revolving Credit Facility [Member] | |||
Debt [Abstract] | |||
Borrowing capacity | 350,000 | ||
Term of loan | 5 years | ||
Proceeds from debt | $ 78,500 | ||
Revolving Credit Facility [Member] | LIBOR [Member] | |||
Debt [Abstract] | |||
Basis spread on variable rate | 2.25% |
Debt, Convertible Note (Details
Debt, Convertible Note (Details) | Apr. 18, 2018USD ($) | Feb. 28, 2018shares | Jun. 16, 2016USD ($) | Mar. 31, 2018USD ($) | Apr. 17, 2018USD ($) | Jun. 30, 2019USD ($)d$ / sharesshares | Jun. 30, 2018USD ($) |
Convertible Debt [Abstract] | |||||||
Debt issuance costs | $ 0 | $ 7,243,000 | |||||
Loss on extinguishment of debt | $ 0 | $ (7,220,000) | |||||
Class A Common Stock [Member] | |||||||
Convertible Debt [Abstract] | |||||||
Shares issued (in shares) | shares | 1,535,652 | ||||||
Convertible Note [Member] | |||||||
Convertible Debt [Abstract] | |||||||
Original principal amount | $ 210,000,000 | ||||||
Interest rate | 4.75% | ||||||
Maturity date | Jun. 15, 2020 | ||||||
Redemption price, percentage of principal amount redeemed | 100.00% | ||||||
Threshold percentage of stock price trigger | 180.00% | ||||||
Threshold trading days | d | 20 | ||||||
Threshold final trading days | d | 3 | ||||||
Threshold consecutive trading days | d | 30 | ||||||
Principal amount increments that can be repurchased upon a change in control or termination of trading of common stock | $ 1,000 | ||||||
Principal amount increments that can be converted | $ 1,000 | ||||||
Holding period following issue date before notes can be converted | 6 months | ||||||
Initial conversion rate (in shares) | shares | 21.5054 | ||||||
Initial conversion price (in dollars per share) | $ / shares | $ 46.50 | ||||||
Proceeds from issuance of notes | 210,000,000 | ||||||
Liability component of convertible notes | 199,100,000 | ||||||
Equity component of convertible notes allocated to additional paid-in capital | $ 10,900,000 | ||||||
Effective interest rate | 7.10% | ||||||
Debt issuance costs | $ 6,600,000 | ||||||
Additions to deferred financing cost | 6,300,000 | ||||||
Adjustments to additional paid-in capital for debt issuance costs | $ 300,000 | ||||||
Payment for principal and accrued interest | $ 213,400,000 | ||||||
Accrued interest | $ 3,400,000 | ||||||
Loss on extinguishment of debt | $ (7,200,000) |
Debt, Debt Facilities (Details)
Debt, Debt Facilities (Details) - USD ($) $ in Thousands | 6 Months Ended | |||
Jun. 30, 2019 | Dec. 31, 2018 | Apr. 18, 2018 | ||
Debt [Abstract] | ||||
Current portion of long-term debt | $ 59,500 | $ 69,455 | ||
Credit Agreement [Member] | ||||
Debt [Abstract] | ||||
Unamortized debt issuance costs | 3,500 | 4,000 | ||
Credit Agreement Term Loan Facility [Member] | ||||
Debt [Abstract] | ||||
Original principal amount | 400,000 | $ 400,000 | ||
Balance | $ 375,000 | [1],[2] | 385,000 | |
Interest rate | Variable 30 day: 4.15% | |||
Interest rate | 4.15% | |||
Term of variable rate | 30 days | |||
Repayment terms | 35% of the principal amount is payable in increasing quarterly installments over a five-year period that began on June 30, 2018, with the remainder payable at the end of the five-year term. | |||
Percentage of principal payable in installments | 35.00% | |||
Term of loan | 5 years | |||
Current portion of long-term debt | $ 22,500 | |||
Credit Agreement Revolving Credit Facility [Member] | ||||
Debt [Abstract] | ||||
Balance | $ 37,000 | [1],[2] | $ 49,500 | |
Interest rate | Variable 30 day: 4.15% | |||
Interest rate | 4.15% | |||
Term of variable rate | 30 days | |||
Repayment terms | Revolving line of credit expires April 18, 2023. | |||
Term of loan | 5 years | |||
Current portion of long-term debt | $ 37,000 | |||
[1] | As of June 30, 2019, the current portion of the Company’s debt (i.e. becoming due in the next 12 months) included $22.5 million of the balance of its term loan under the Credit Agreement. The Company has classified the $37.0 million borrowed under the revolving line of credit as current debt because it is the Company’s intention to use the line of credit to borrow and pay back funds over short periods of time. | |||
[2] | The carrying value of the debt reflects the amounts stated in the above table less debt issuance costs of $3.5 million and $4.0 million as of June 30, 2019 and December 31, 2018, respectively, related to the Credit Agreement, which are not reflected in this table. |
Leases (Details)
Leases (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |
Jun. 30, 2019 | Jun. 30, 2019 | Dec. 31, 2018 | |
Leases [Abstract] | |||
Weighted average remaining lease term for operating leases | 4 years 1 month 6 days | 4 years 1 month 6 days | |
Weighted average discount rate for operating leases | 4.80% | 4.80% | |
Components of Lease Expense [Abstract] | |||
Operating lease cost | $ 12,417 | $ 25,278 | |
Short-term lease cost | 52 | 104 | |
Variable lease cost | 1,105 | 2,157 | |
Total lease expense | 13,574 | 27,539 | |
Operating right-of-use assets | 118,507 | 118,507 | $ 0 |
Current operating lease liabilities | 37,200 | 37,200 | |
Long-term operating lease liabilities | 84,102 | 84,102 | 0 |
Supplemental Cash Flow Information Related to Leases [Abstract] | |||
Operating cash outflow from operating leases | 26,570 | ||
ROU assets obtained in exchange for lease obligations | 140,585 | ||
Maturities of Operating Lease Liabilities [Abstract] | |||
2019 | 23,632 | 23,632 | |
2020 | 37,424 | 37,424 | |
2021 | 30,478 | 30,478 | |
2022 | 16,439 | 16,439 | |
2023 | 11,574 | 11,574 | |
Thereafter | 15,514 | 15,514 | |
Total | 135,061 | 135,061 | |
Less: Finance charges | 13,794 | 13,794 | |
Total principal liability | 121,267 | 121,267 | |
Additional lease liabilities not yet commenced | $ 200 | $ 200 | |
Operating Leases, Minimum Future Obligations [Abstract] | |||
2019 | 39,358 | ||
2020 | 27,553 | ||
2021 | 20,266 | ||
2022 | 11,723 | ||
2023 | 9,950 | ||
Thereafter | 7,628 | ||
Total minimum lease payments | 116,478 | ||
Financing Obligations, Minimum Future Obligations [Abstract] | |||
2019 | 726 | ||
2020 | 748 | ||
2021 | 757 | ||
2022 | 770 | ||
2023 | 794 | ||
Thereafter | 1,148 | ||
Total minimum lease payments | $ 4,943 | ||
Minimum [Member] | |||
Leases [Abstract] | |||
Remaining lease terms | 1 year | ||
Maximum [Member] | |||
Leases [Abstract] | |||
Remaining lease terms | 15 years | ||
Extension period for leases | 10 years | ||
Termination period for leases | 1 year |
Capital Stock (Details)
Capital Stock (Details) - USD ($) $ / shares in Units, $ in Thousands | Aug. 06, 2019 | Jun. 12, 2019 | Mar. 13, 2019 | Apr. 30, 2019 | Feb. 28, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 |
Dividends per Share [Abstract] | |||||||||
Payment of cash dividends | $ 41,084 | $ 40,091 | |||||||
Repurchases of Common Stock [Abstract] | |||||||||
Class A common stock repurchased | $ 0 | $ 18,437 | 825 | $ 35,823 | |||||
Amount available for repurchases | $ 470,200 | $ 470,200 | |||||||
Treasury Stock [Member] | |||||||||
Repurchases of Common Stock [Abstract] | |||||||||
Class A common stock repurchased (in shares) | 0 | 200,000 | 14,000 | 500,000 | |||||
Class A common stock repurchased | $ 0 | $ 18,437 | $ 825 | $ 35,823 | |||||
Dividend Declared 2019 Q1 [Member] | |||||||||
Dividends per Share [Abstract] | |||||||||
Dividend payable, date declared | 2019-02 | 2019-02 | |||||||
Dividend payable per share (in dollars per share) | $ 0.37 | ||||||||
Payment of cash dividends | $ 20,500 | ||||||||
Dividend payable, date paid | Mar. 13, 2019 | ||||||||
Dividend payable, date of record | Feb. 25, 2019 | ||||||||
Dividend Declared 2019 Q2 [Member] | |||||||||
Dividends per Share [Abstract] | |||||||||
Dividend payable, date declared | 2019-04 | 2019-04 | |||||||
Dividend payable per share (in dollars per share) | $ 0.37 | ||||||||
Payment of cash dividends | $ 20,600 | ||||||||
Dividend payable, date paid | Jun. 12, 2019 | ||||||||
Dividend payable, date of record | May 31, 2019 | ||||||||
Dividend Declared 2019 Q3 [Member] | Subsequent Event [Member] | |||||||||
Dividends per Share [Abstract] | |||||||||
Dividend payable, date declared | 2019-08 | ||||||||
Dividend payable per share (in dollars per share) | $ 0.37 | ||||||||
Dividend payable, date paid | Sep. 11, 2019 | ||||||||
Dividend payable, date of record | Aug. 30, 2019 | ||||||||
Stock Options [Member] | |||||||||
Net Income per Share [Abstract] | |||||||||
Anti-dilutive shares excluded from calculation of diluted earnings per share (in shares) | 1,100,000 | 300,000 | 1,100,000 | 900,000 |
Fair Value (Details)
Fair Value (Details) - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2019 | Dec. 31, 2018 | |
Fair Value on a Recurring Basis [Member] | ||
Financial Assets (Liabilities) [Abstract] | ||
Cash equivalents and current investments | $ 37,082 | $ 35,260 |
Other long-term assets | 3,886 | 3,568 |
Life insurance contracts | 39,585 | 35,590 |
Financial assets (liabilities), net | 80,553 | 74,418 |
Fair Value on a Recurring Basis [Member] | Level 1 [Member] | ||
Financial Assets (Liabilities) [Abstract] | ||
Cash equivalents and current investments | 37,082 | 35,260 |
Other long-term assets | 3,886 | 3,568 |
Life insurance contracts | 0 | 0 |
Financial assets (liabilities), net | 40,968 | 38,828 |
Fair Value on a Recurring Basis [Member] | Level 2 [Member] | ||
Financial Assets (Liabilities) [Abstract] | ||
Cash equivalents and current investments | 0 | 0 |
Other long-term assets | 0 | 0 |
Life insurance contracts | 0 | 0 |
Financial assets (liabilities), net | 0 | 0 |
Fair Value on a Recurring Basis [Member] | Level 3 [Member] | ||
Financial Assets (Liabilities) [Abstract] | ||
Cash equivalents and current investments | 0 | 0 |
Other long-term assets | 0 | 0 |
Life insurance contracts | 39,585 | 35,590 |
Financial assets (liabilities), net | 39,585 | $ 35,590 |
Life Insurance Contracts [Member] | ||
Changes in Fair Value of Level 3 Marketable Securities [Roll Forward] | ||
Beginning balance | 35,590 | |
Actual return on plan assets | 3,566 | |
Purchases and issuances | 2,003 | |
Sales and settlements | (1,574) | |
Transfers into Level 3 | 0 | |
Ending balance | $ 39,585 |
Income Taxes (Details)
Income Taxes (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | Dec. 31, 2018 | |
Income Taxes [Abstract] | |||||
Provision for income taxes | $ 24,527 | $ 20,638 | $ 47,330 | $ 45,296 | |
Effective tax rate | 34.60% | 28.80% | 34.60% | 34.40% | |
Net deferred tax assets | $ 14,800 | $ 14,800 | $ 19,100 | ||
Undistributed earnings of non-U.S. subsidiaries | 60,000 | ||||
Incremental taxes if undistributed earnings on non-U.S. subsidiaries were repatriated | $ 6,000 | ||||
Minimum [Member] | |||||
Income Taxes [Abstract] | |||||
Decrease in unrecognized tax benefits within the next 12 months that is reasonably possible | (500) | $ (500) | |||
Maximum [Member] | |||||
Income Taxes [Abstract] | |||||
Statute of limitations related to income tax examinations | 10 years | ||||
Income Taxes [Abstract] | |||||
Decrease in unrecognized tax benefits within the next 12 months that is reasonably possible | $ (1,500) | $ (1,500) |
Derivative Financial Instrume_3
Derivative Financial Instruments (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | Dec. 31, 2018 | |
Foreign Currency Derivatives [Abstract] | |||||
Unrealized gains/(losses) related to foreign currency cash flow hedges included in accumulated other comprehensive loss | $ 0 | $ 0 | $ 0 | ||
Cumulative translation adjustments included in accumulated other comprehensive loss | 81,300 | 81,300 | $ 79,900 | ||
Foreign Currency Forward Contracts [Member] | Not Designated as Hedging Instrument [Member] | |||||
Foreign Currency Derivatives [Abstract] | |||||
Gain (loss) on derivative instruments | 0 | $ 0 | 0 | $ 0 | |
Foreign Currency Forward Contracts [Member] | Designated as Hedging Instrument [Member] | Cash Flow Hedges [Member] | |||||
Foreign Currency Derivatives [Abstract] | |||||
Notional amount | 0 | 0 | 0 | 0 | |
Foreign Currency Forward Contracts [Member] | Other Comprehensive Income (Loss) [Member] | Designated as Hedging Instrument [Member] | Cash Flow Hedges [Member] | |||||
Foreign Currency Derivatives [Abstract] | |||||
Gain (loss) recognized in other comprehensive loss | 0 | 87 | 0 | (160) | |
Foreign Currency Forward Contracts [Member] | Revenue [Member] | Designated as Hedging Instrument [Member] | Cash Flow Hedges [Member] | |||||
Foreign Currency Derivatives [Abstract] | |||||
Gain (loss) reclassified from accumulated other comprehensive loss into income | $ 0 | $ (26) | $ 0 | $ 18 |
Segment Information, Revenue by
Segment Information, Revenue by Segment (Details) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2019USD ($) | Jun. 30, 2018USD ($) | Jun. 30, 2019USD ($)Segment | Jun. 30, 2018USD ($) | ||
Segment Information [Abstract] | |||||
Number of reportable segments | Segment | 9 | ||||
Number of geographic segments | Segment | 7 | ||||
Number of new segments previously included in Other category | Segment | 2 | ||||
Revenue by Segment [Abstract] | |||||
Revenue | $ 623,500 | $ 704,190 | $ 1,247,123 | $ 1,320,409 | |
Other [Member] | |||||
Revenue by Segment [Abstract] | |||||
Revenue | 1,249 | 1,030 | (177) | 1,265 | |
Mainland China [Member] | |||||
Revenue by Segment [Abstract] | |||||
Revenue | 185,333 | 245,256 | 393,821 | 442,787 | |
Americas/Pacific [Member] | |||||
Revenue by Segment [Abstract] | |||||
Revenue | 92,841 | 103,990 | 179,297 | 196,279 | |
South Korea [Member] | |||||
Revenue by Segment [Abstract] | |||||
Revenue | 84,732 | 91,624 | 168,585 | 180,554 | |
Southeast Asia [Member] | |||||
Revenue by Segment [Abstract] | |||||
Revenue | 75,395 | 79,223 | 147,890 | 150,083 | |
Japan [Member] | |||||
Revenue by Segment [Abstract] | |||||
Revenue | 65,251 | 64,113 | 127,360 | 127,337 | |
Hong Kong/Taiwan [Member] | |||||
Revenue by Segment [Abstract] | |||||
Revenue | 43,712 | 52,206 | 84,270 | 93,198 | |
EMEA [Member] | |||||
Revenue by Segment [Abstract] | |||||
Revenue | 43,400 | 44,010 | 85,218 | 88,991 | |
Operating Segment [Member] | Manufacturing [Member] | |||||
Revenue by Segment [Abstract] | |||||
Revenue | [1] | 31,557 | 22,738 | 60,829 | 39,915 |
Operating Segment [Member] | Grow Tech [Member] | |||||
Revenue by Segment [Abstract] | |||||
Revenue | 30 | 0 | 30 | 0 | |
Nu Skin [Member] | |||||
Revenue by Segment [Abstract] | |||||
Revenue | 591,913 | 681,452 | 1,186,264 | 1,280,494 | |
Intersegment Member] | Manufacturing [Member] | |||||
Revenue by Segment [Abstract] | |||||
Revenue | $ 6,500 | $ 6,600 | $ 12,400 | $ 9,800 | |
[1] | The Manufacturing segment had $6.5 million and $6.6 million of intersegment revenue for the three-month period ended June 30, 2019 and 2018, respectively, and $12.4 million and $9.8 million. for the first half of 2019 and 2018, respectively. Intersegment revenue is eliminated in the consolidated financial statements, as well as the reported segment revenue in the table above. |
Segment Information, Segment Co
Segment Information, Segment Contribution (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | |
Segment Contribution [Abstract] | ||||
Operating income (loss) | $ 74,202 | $ 82,764 | $ 142,855 | $ 141,754 |
Other income (expense) | (3,326) | (11,165) | (6,174) | (9,958) |
Income before provision for income taxes | 70,876 | 71,599 | 136,681 | 131,796 |
Mainland China [Member] | ||||
Segment Contribution [Abstract] | ||||
Operating income (loss) | 51,087 | 73,899 | 110,254 | 118,716 |
Americas/Pacific [Member] | ||||
Segment Contribution [Abstract] | ||||
Operating income (loss) | 16,420 | 17,068 | 28,439 | 26,240 |
South Korea [Member] | ||||
Segment Contribution [Abstract] | ||||
Operating income (loss) | 25,979 | 24,880 | 51,647 | 51,081 |
Southeast Asia [Member] | ||||
Segment Contribution [Abstract] | ||||
Operating income (loss) | 20,840 | 20,639 | 38,832 | 37,041 |
Japan [Member] | ||||
Segment Contribution [Abstract] | ||||
Operating income (loss) | 15,823 | 13,377 | 29,929 | 26,615 |
Hong Kong/Taiwan [Member] | ||||
Segment Contribution [Abstract] | ||||
Operating income (loss) | 9,217 | 7,835 | 16,691 | 15,681 |
EMEA [Member] | ||||
Segment Contribution [Abstract] | ||||
Operating income (loss) | 3,234 | 3,069 | 4,585 | 7,823 |
Nu Skin [Member] | ||||
Segment Contribution [Abstract] | ||||
Operating income (loss) | 142,600 | 160,767 | 280,377 | 283,197 |
Operating Segment [Member] | ||||
Segment Contribution [Abstract] | ||||
Operating income (loss) | 141,393 | 161,058 | 279,187 | 281,874 |
Corporate and Other [Member] | ||||
Segment Contribution [Abstract] | ||||
Operating income (loss) | (67,191) | (78,294) | (136,332) | (140,120) |
Manufacturing [Member] | Operating Segment [Member] | ||||
Segment Contribution [Abstract] | ||||
Operating income (loss) | 3,375 | 2,348 | 7,021 | 1,994 |
Grow Tech [Member] | Operating Segment [Member] | ||||
Segment Contribution [Abstract] | ||||
Operating income (loss) | $ (4,582) | $ (2,057) | $ (8,211) | $ (3,317) |
Segment Information, Depreciati
Segment Information, Depreciation and Amortization and Capital Expenditures (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | |
Summarized Financial Information [Abstract] | ||||
Depreciation and amortization | $ 19,052 | $ 21,235 | $ 38,659 | $ 40,142 |
Capital expenditures | 15,449 | 15,777 | 29,214 | 28,429 |
Mainland China [Member] | ||||
Summarized Financial Information [Abstract] | ||||
Depreciation and amortization | 2,909 | 3,444 | 6,025 | 6,931 |
Capital expenditures | 1,033 | 1,029 | 2,714 | 2,898 |
Americas/Pacific [Member] | ||||
Summarized Financial Information [Abstract] | ||||
Depreciation and amortization | 206 | 279 | 420 | 493 |
Capital expenditures | 473 | 240 | 747 | 429 |
South Korea [Member] | ||||
Summarized Financial Information [Abstract] | ||||
Depreciation and amortization | 1,358 | 1,576 | 2,882 | 3,243 |
Capital expenditures | 30 | 44 | 79 | 44 |
Southeast Asia [Member] | ||||
Summarized Financial Information [Abstract] | ||||
Depreciation and amortization | 462 | 564 | 939 | 1,123 |
Capital expenditures | 225 | 144 | 319 | 195 |
Japan [Member] | ||||
Summarized Financial Information [Abstract] | ||||
Depreciation and amortization | 957 | 900 | 2,005 | 1,815 |
Capital expenditures | 946 | 72 | 1,118 | 383 |
Hong Kong/Taiwan [Member] | ||||
Summarized Financial Information [Abstract] | ||||
Depreciation and amortization | 537 | 321 | 1,053 | 644 |
Capital expenditures | 1,091 | 116 | 1,554 | 598 |
EMEA [Member] | ||||
Summarized Financial Information [Abstract] | ||||
Depreciation and amortization | 272 | 175 | 712 | 351 |
Capital expenditures | 42 | 42 | 76 | 77 |
Nu Skin [Member] | ||||
Summarized Financial Information [Abstract] | ||||
Depreciation and amortization | 6,701 | 7,259 | 14,036 | 14,600 |
Capital expenditures | 3,840 | 1,687 | 6,607 | 4,624 |
Corporate and Other [Member] | ||||
Summarized Financial Information [Abstract] | ||||
Depreciation and amortization | 9,775 | 10,927 | 19,598 | 19,450 |
Capital expenditures | 7,964 | 7,636 | 14,375 | 14,015 |
Manufacturing [Member] | Operating Segments [Member] | ||||
Summarized Financial Information [Abstract] | ||||
Depreciation and amortization | 1,631 | 2,821 | 3,205 | 5,646 |
Capital expenditures | 1,579 | 719 | 3,181 | 1,468 |
Grow Tech [Member] | Operating Segments [Member] | ||||
Summarized Financial Information [Abstract] | ||||
Depreciation and amortization | 945 | 228 | 1,820 | 446 |
Capital expenditures | $ 2,066 | $ 5,735 | $ 5,051 | $ 8,322 |
Acquisitions (Details)
Acquisitions (Details) - USD ($) $ in Thousands | Feb. 12, 2018 | Jan. 22, 2018 | Jun. 30, 2019 | Dec. 31, 2018 | Feb. 11, 2018 | Jan. 21, 2018 |
Acquisitions [Abstract] | ||||||
Goodwill | $ 196,573 | $ 196,573 | ||||
Nutritional Product Manufacturer [Member] | ||||||
Acquisitions [Abstract] | ||||||
Percentage of acquired entity held by third party | 8.00% | |||||
Innuvate [Member] | ||||||
Acquisitions [Abstract] | ||||||
Percentage of entity acquired | 73.00% | |||||
Ownership interest in equity method investment | 27.00% | |||||
Consideration paid in cash and shares | $ 23,500 | |||||
Goodwill | 17,200 | |||||
Innuvate [Member] | Nutritional Product Manufacturer [Member] | ||||||
Acquisitions [Abstract] | ||||||
Percentage of entity acquired | 92.00% | |||||
Treviso [Member] | ||||||
Acquisitions [Abstract] | ||||||
Percentage of entity acquired | 65.00% | |||||
Ownership interest in equity method investment | 35.00% | |||||
Consideration paid in cash and shares | $ 83,900 | |||||
Goodwill | 42,500 | |||||
L&W [Member] | ||||||
Acquisitions [Abstract] | ||||||
Percentage of entity acquired | 100.00% | |||||
Consideration paid in shares | $ 25,000 | |||||
Goodwill | $ 12,800 |
Restructuring (Details)
Restructuring (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |
Jun. 30, 2019 | Mar. 31, 2019 | Jun. 30, 2019 | |
Restructuring [Abstract] | |||
Non-cash impairment charges | $ 48,600 | ||
Cash charges associated with restructuring | 22,100 | ||
Employee severance | 20,100 | ||
Other related restructuring charges | 2,000 | ||
Restructuring Reserve [Roll Forward] | |||
Beginning balance | $ 0 | $ 15,462 | $ 15,462 |
Amounts paid | (15,046) | ||
Adjustments | (416) | ||
Ending balance | $ 0 | ||
Restructuring activity | $ 0 |