OREANDA-NEWS. Reliv International, Inc. (NASDAQ:RELV), a maker of nutritional supplements that promote optimal health, today reported its financial results for the second quarter of 2017.

Reliv reported net sales of $10.0 million for the second quarter of 2017 compared with net sales of $11.1 million in the second quarter of 2016.  Net sales in the United States decreased to $7.5 million in the second quarter of 2017 compared to $8.4 million in the prior-year quarter. Net sales in Reliv’s foreign markets decreased 5.2 percent in the second quarter of 2017 compared with the prior-year second quarter. Foreign sales increased by 2.8 percent when the impact of foreign currency fluctuation is removed as the result of a stronger U.S. dollar.  An increase of 74.2 percent in net sales in Asia in the second quarter of 2017 was offset by a decline of 19.3 percent in net sales in Europe, along with decreases in other regions.  Net sales in Europe declined by 9.5 percent when the impact of foreign currency fluctuation is removed.

Reliv reported a net loss for the second quarter of 2017 of $520,000 (loss per diluted share of $0.28) compared to a net loss of $988,000 (loss per diluted share of $0.54) in the second quarter of 2016.    The loss per diluted share for the second quarter of 2016 has been adjusted for the one-for-seven reverse stock split that took effect on October 4, 2016.  The loss from operations for the second quarter of 2017 was $508,000 compared to a loss from operations of $940,000 in the same period in 2016.  Selling, general and administrative (“SGA”) expenses decreased from $5.5 million in the second quarter of 2016 to $4.6 million in the second quarter of 2017.  The reduction in 2017 SGA expenses is the result of the continuing impact of a cost reduction program that took place in mid-2016.

Net sales for the first six months of 2017 were $22.8 million, which represents a 5.4 percent decrease from the same period in 2016.  Net sales in the United States decreased by 4.8 percent and net sales in Reliv’s foreign markets decreased by 7.4 percent in the first half of 2017 compared with the first half of last year.   Net sales in Reliv’s foreign markets increased by 0.7 percent during the first six months of 2017 when the impact of foreign currency fluctuation is removed.

Reliv reported net income of $4,000, or $0.00 per diluted share in the first six months of 2017, compared to a net loss of $1.0 million or $0.56 per diluted share in the same period of 2016.

Reliv recently held its International Distributor Conference in suburban Chicago, Illinois where the theme of this year’s conference was “Fit for Life.”  In addition to workshops and panel discussions focused on how to build a home-based Reliv business, the conference highlighted the Fit3TM product line and program in helping people achieve a healthy and active lifestyle.  Launched in February 2017, the Fit3 program consists of three principal components: nutrition coaching, exercise coaching, and three new Fit3 products: Active, Burn and Purify.

Reliv also announced enhancements to its Director Program to include distributor earnings from wholesale and retail sales in qualifying for the various director levels, from Key Director up through Presidential Director.  “We believe it’s important to recognize all of the activity of the leaders that are developing a strong Customer, Preferred Customer, and Retail Distributor base,” said Ryan Montgomery, President.  “Distributors conduct their business in different ways, and whether it’s done in a traditional person-to-person setting or via an internet platform, such as our personalized distributor websites, it’s critical to recognize that performance.”

Reliv had cash and cash equivalents of $3.4 million as of June 30, 2017, compared to $3.6 million as of December 31, 2016.  Net cash generated from operating activities was $339,000 in the first half of 2017.

As of June 30, 2017, Reliv had 35,110 distributors and preferred customers – a decrease of 17.4 percent from June 30, 2016 – of which 3,730 are Master Affiliate level and above.  The number of Master Affiliates decreased by 29.8 percent compared to the year-ago total.  Master Affiliate is the level at which distributors are eligible to earn generation royalties. The decrease in the number of Master Affiliates in the U.S. and Canada was due in part to the increase in the business volume requirement for distributors to reach the Master Affiliate level.  This change was effective February 1, 2016 as part of our revised compensation plan strategy and affected Master Affiliate requalifications during the first quarter of 2017.

About Reliv International, Inc.

Reliv International, based in Chesterfield, MO, produces nutritional supplements that promote optimal nutrition. Reliv supplements address essential nutrition, fitness and weight loss and targeted solutions. Reliv is the exclusive provider of LunaRich® products, which optimize levels of lunasin, a soy peptide that works at the epigenetic level to promote optimal health. The company sells its products through an international network marketing system of independent distributors in 15 countries. Learn more about Reliv at reliv.com, or on Facebook, Twitter or Instagram.

--FINANCIAL HIGHLIGHTS FOLLOW –

Reliv International, Inc. and Subsidiaries          
           
Condensed Consolidated Balance Sheets          
  June 30 December 31      
  2017 2016      
  (Unaudited)        
Assets          
Current Assets:          
Cash and cash equivalents $3,448,928   $3,606,817        
Accounts receivable, less allowances of          
$26,300 in 2017 and $26,700 in 2016   91,292     126,113        
Accounts and note due from employees and distributors   137,253     139,931        
Inventories   4,430,941     4,487,830        
Other current assets   850,973     571,377        
           
Total current assets   8,959,387     8,932,068        
           
Other assets   7,610,318     7,679,357        
Net property, plant and equipment   5,937,119     5,854,302        
           
Total Assets $22,506,824   $22,465,727        
           
Liabilities and Stockholders' Equity          
           
Accounts payable and accrued expenses $4,359,198   $4,234,305        
Current portion of long-term debt   324,960     389,096        
Long-term debt - noncurrent   2,355,861     2,518,341        
Other noncurrent liabilities   440,983     409,813        
Stockholders' equity   15,025,822     14,914,172        
           
Total Liabilities and Stockholders' Equity $22,506,824   $22,465,727        
           
           
Consolidated Statements of Operations          
  Three months ended June 30   Six months ended June 30
  2017 2016   2017 2016
  (Unaudited) (Unaudited)   (Unaudited) (Unaudited)
Product sales $9,258,809   $10,166,478     $21,093,925   $22,209,039  
Handling & freight income   747,819     886,844       1,690,485     1,880,733  
           
Net Sales   10,006,628     11,053,322       22,784,410     24,089,772  
           
Costs and expenses:          
Cost of products sold   2,328,452     2,530,771       5,163,977     5,514,875  
Distributor royalties and commissions   3,554,773     3,921,005       8,053,326     8,545,380  
Selling, general and administrative   4,631,860     5,541,328       9,558,139     11,150,596  
           
Total Costs and Expenses   10,515,085     11,993,104       22,775,442     25,210,851  
           
Income (loss) from operations   (508,457 )   (939,782 )     8,968     (1,121,079 )
           
Other income (expense):          
Interest income   25,827     27,133       51,353     54,490  
Interest expense   (27,448 )   (26,778 )     (52,289 )   (53,179 )
Other income   12,413     71,263       45,096     184,944  
           
Income (loss) before income taxes   (497,665 )   (868,164 )     53,128     (934,824 )
Provision for income taxes   22,000     120,000       49,000     97,000  
           
Net income (loss) ($519,665 ) ($988,164 )   $4,128   ($1,031,824 )
           
           
Earnings (loss) per common share - Basic ($0.28 ) ($0.54 )   $0.00   ($0.56 )
Weighted average shares   1,845,000     1,846,000       1,845,000     1,846,000  
           
Earnings (loss) per common share - Diluted ($0.28 ) ($0.54 )   $0.00   ($0.56 )
Weighted average shares   1,845,000     1,846,000       1,846,000     1,846,000  
Reliv International, Inc. and Subsidiaries            
                 
Net sales by Market        
(in thousands) Three months ended June 30,   Change from
  2017   2016   prior year
  Amount % of Net Sales   Amount % of Net Sales   Amount %
                 
United States $ 7,450 74.4 %   $ 8,356 75.6 %   $ (906 ) -10.8 %
Australia/New Zealand   227 2.3 %     286 2.6 %     (59 ) -20.6 %
Canada   217 2.2 %     242 2.2 %     (25 ) -10.3 %
Mexico   89 0.9 %     137 1.2 %     (48 ) -35.0 %
Europe   1,308 13.1 %     1,621 14.7 %     (313 ) -19.3 %
Asia   716 7.1 %     411 3.7 %     305   74.2 %
                 
Consolidated Total $ 10,007 100.0 %   $ 11,053 100.0 %   $ (1,046 ) -9.5 %
                 
                 
Net sales by Market                
(in thousands) Six months ended June 30,   Change from
  2017   2016   prior year
  Amount % of Net Sales   Amount % of Net Sales   Amount %
                 
United States $ 17,709 77.7 %   $ 18,610 77.3 %   $ (901 ) -4.8 %
Australia/New Zealand   486 2.1 %     584 2.4 %     (98 ) -16.8 %
Canada   481 2.1 %     549 2.3 %     (68 ) -12.4 %
Mexico   247 1.1 %     300 1.2 %     (53 ) -17.7 %
Europe   2,508 11.0 %     3,177 13.2 %     (669 ) -21.1 %
Asia   1,353 6.0 %     870 3.6 %     483   55.5 %
                 
Consolidated Total $ 22,784 100.0 %   $ 24,090 100.0 %   $ (1,306 ) -5.4 %
                 
                 
The following table sets forth, as of June 30, 2017 and 2016, the number of our Active Distributors/Preferred Customers and Master
Affiliates and above.  The total number of active distributors includes Master Affiliates and above. We define an active distributor as one that
enrolls as a distributor or renews his or her distributorship during the prior twelve months.  Master Affiliates and above are distributors that
have attained the highest level of discount and are eligible for royalties generated by Master Affiliate groups in their downline organization. 
In February 2016, we introduced a formal Preferred Customer program in the United States and Canada.  As a result, we are including
Preferred Customers as part of our Active Distributor count.  Preferred Customer programs were previously in place in Europe and other
foreign markets.  Preferred Customers represent approximately 4,960 and 4,490 of the Active Distributor count as of June 30, 2017 and
2016, respectively.
                 
                 
Active Distributors/Preferred Customers and Master Affiliates and Above by Market      
                 
  As of 6/30/2017   As of 6/30/2016   Change in %
  Active
Distributors
and Preferred
Customers		 Master
Affiliates and
Above		   Active
Distributors
and Preferred
Customers		 Master
Affiliates and
Above		   Active
Distributors
and Preferred
Customers		 Master
Affiliates and
Above
     
                 
United States   24,670 2,690       30,080 4,110       -18.0 % -34.5 %
Australia/New Zealand   1,240 110       1,660 130       -25.3 % -15.4 %
Canada   740 90       970 150       -23.7 % -40.0 %
Mexico   770 60       1,130 90       -31.9 % -33.3 %
Europe   4,130 430       5,630 510       -26.6 % -15.7 %
Asia   3,560 350       3,030 320       17.5 % 9.4 %
                 
Consolidated Total   35,110 3,730       42,500 5,310       -17.4 % -29.8 %