NATURES SUNSHINE PRODUCTS INC Q4 FY2025 earnings call

• CEO Ken Romanci highlights 5% sales growth and 10% EBITDA growth, noting highest annual sales ever. • Two strong brands, global business in over 40 countries, strong product development, independent consultants, digital business growth. • CFO Shane Jones details regional performance: North America digital growth, Asia Pacific execution in China and Japan, Europe strength in Eastern Europe. • Progress in gross margin initiatives, SG&A expenses increase due to digital ad spend and other factors. • 2026 outlook: net sales range $500 - $515 million (4%-7% growth), adjusted EBITDA range $50 - $54 million (1%-9% growth), with investments in technology, customer acquisition, etc. • Major Sunshine Vision for Growth with seven core drivers: digital expansion, core market penetration, geographic expansion, retail channels, brand positioning, supply chain scale, M&A.

Net sales in Q4 were $123.8 million (5% growth vs year-ago, 4% excluding FX), full year 2025 net sales $480.1 million (6% growth vs 2024, 5% excluding FX). North America Q4 sales $37.4 million (6% growth), digital sales up 47% in Q4, digital subscriptions 47% of revenue in Q4. Asia Pacific Q4 sales $55.7 million (1% decline), but China and Japan had strong growth. Europe Q4 sales $25.2 million (18% growth, 14% constant currency). Gross margin 72.5% in Q4 (55bps increase vs year-ago). SG&A expenses $48.4 million in Q4 (39.1% of net sales). Operating income $5.3 million, net income $4.1 million, adjusted EBITDA $11.9 million in Q4. Full year 2025 adjusted EBITDA $49.4 million.

• Full year 2026 net sales expected to range $500 - $515 million (4%-7% growth). • Adjusted EBITDA guided to $50 - $54 million (1%-9% growth). • Investments in technology infrastructure, customer acquisition, geographic expansion, product innovation, with benefits seen in out years. • Uncertainties like tariffs, inflation, macro factors incorporated into guidance.

• Factors that could cause results to differ materially include those disclosed in the company's annual report on Form 10-K under risk factors and other SEC filings, such as uncertainties related to tariffs, inflation, and macroeconomic conditions.

Q: Brian Holander asks about 2026 EBITDA range and what's included.

A: Shane Jones says EBITDA projections include uncertainties like tariffs and inflation, investments with benefits in out years, and macro uncertainties.

Q: Brian asks about consumer demand in 2026 early in the quarter.

A: Shane says still seeing strong consumer demand, no let-up from Q4 trends.

Q: Brian asks about addressable market and M&A for billion-dollar business.

A: Ken Romanci says market is large and growing, TAM huge, strong organic growth and M&A possible.

Q: Susan Anderson asks about digital growth in North America customer acquisition and product purchase.

A: Ken and Shane say it's an ecosystem, customers come from various channels, benefit from influencer-driven demand.

Q: Susan asks about cannibalizing older channels.

A: Ken says product differentiation, robust product pipeline allows growth without cannibalizing, with different products for different channels.