Natural Health Trends Corp. Q2 FY2025 earnings call

• Second quarter net sales were $9.8 million, down 6% from Q2 2024 due to economic uncertainty and trade tensions. - Actively transitioning U.S.-based supply chain to Asia to reduce tariff exposure, streamline logistics, and access R&D resources. - Executed programs, promotions, and incentives to drive engagement and loyalty, including incentive trips and in-person engagements. - Officially launched Colombia market, with strong enthusiasm for growth in South America. - Exercising operational discipline with focus on expense management, margin protection, inventory control, and supply chain recalibration. - CFO discussed financial results, cash flows, balance sheet, and declared a quarterly dividend of $0.20 per share.

Second quarter net sales were $9.8 million, a 6% decrease compared to the second quarter of 2024. Hong Kong sales, making up 82% of the quarter's sales, declined 5% year-over-year. Gross profit margin was 73.9%, relatively consistent with the second quarter last year. Commissions expense as a percent of total sales for the second quarter were 40.9% compared with 40.1% a year ago. Selling, general and administrative expenses declined to $3.6 million for the quarter from $3.8 million in the second quarter a year ago. Operating loss for the quarter was $333,000 compared to $238,000 in the second quarter last year, and net income for the second quarter totaled $15,000 or breakeven per diluted share compared to $173,000 or $0.02 per diluted share in the second quarter of 2024.

• Investing in brand programs, incentives, product innovation, and digital enhancements to drive recovery and future growth. - Supply chain recalibration to mitigate tariff uncertainty as part of strategy to shield business from economic headwinds and improve resilience.

• Economic uncertainty and evolving trade tensions weighing on consumer sentiment in key markets. - Impact of global trade environment on sales and supply chain stability.

Q: A: Q: A: