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USANA Health Sciences Inc (USNA -1.28%)
Q4 2019 Earnings Call
Feb 5, 2020, 11:00 a.m. ET
Contents:
- Prepared Remarks
- Questions and Answers
- Call Participants
Prepared Remarks:
Operator
Good day, and welcome to the USANA Health Sciences Fourth Quarter Conference call. [Operator Instructions]
At this time, I would like to turn the conference over to Mr. Patrique Richards, Executive Director of Investor Relations and Business Development. Please go ahead, sir.
Patrique Richards -- Executive Director of Investor Relations and Business Development
Thank you. Good morning. We appreciate you joining us this morning to review our fourth quarter and full year results. Today's conference call is being broadcast live via webcast and can be accessed directly from our website at ir.usana.com. Shortly, following the call, a replay will be available on our website.
As a reminder, during the course of this conference call, management will make forward-looking statements regarding future events or the future financial performance of our company. Those statements involve risks and uncertainties that could cause actual results to differ, perhaps materially, from the results projected in such forward-looking statements. Examples of these statements include those regarding our strategies and outlook for fiscal year 2020. We caution you that these statements should be considered in conjunction with disclosures, including specific risk factors and financial data contained in our most recent filings with the SEC.
I'm joined this morning by our CEO, Kevin Guest; our President, Jim Brown; our Chief Financial Officer, Doug Hekking; as well as other executives. Yesterday, after the market closed, we announced our fourth quarter results and posted our management commentary results and outlook document on the company's website.
We'll now hear brief remarks from Kevin before opening the call for questions.
Kevin G. Guest -- Chief Executive Officer and Director
Good morning, and thank you for joining us. The fourth quarter was an excellent end to fiscal year 2019. We ran several successful promotions during the quarter, which helped contribute to the momentum in many of our markets around the world. As a result, both net sales and earnings per share exceeded our guidance.
In November, we held our Annual China National Meeting in Macau. This event generates a lot of excitement in the region, and attendance was strong again this year. At the event, we introduced new products that were very well received in the market. To help build on this, we also offered a product promotion following the event that focused on products that we introduced at the event. This promotion was also very successful.
In other markets around the world, we ran successful promotions that highlighted Celavive, our skin and personal care line. Although we faced a fair amount of challenges throughout 2019, I'm pleased to report that we finished the year with positive momentum. As we look forward, we're optimistic about the future of USANA. We're confident that USANA is positioned to build upon the solid foundation of the last 27 years while also adapting to meet the growing needs and demands of the today's customers.
In 2020, our global strategy will remain focused on advancing our customer experience strategy. This strategy involves many different initiatives that touch nearly all areas of our business. At the center of this effort is the need to offer technology enhancements and product innovation. We're committed to making the appropriate investments to staying relevant in this fast-paced environment.
Our business has been and we will always be about health, people, and relationships. But now more than ever, these relationships and interactions are taking place through technology. Over the last several years, USANA has made meaningful investments to ensure that we are providing our customers with the technology to support each of these factors. Equally important is our need to remain relevant from a product innovation standpoint.
We will roll out several new products throughout the year across several of our product categories. These are not only products that promote better health, but there are also products that our customers are requesting and we think they'll contribute to our growth in 2020. Although, it's a bit early to speak about it, I'd also like to mention that we are planning to roll out a whole new product category in early 2021. This new product line will offer our customers a more holistic approach to their health and wellbeing, while also leveraging investments we have and will make in both technology and our new manufacturing facility next door.
Finally, we will focus on customer acquisition through a combination of incentive offerings, new customer-centric product offerings and programs designed to broaden and increase our customer reach. Additionally, we will continue to offer market-specific promotions that target and address the needs of different customer demographics within each individual market.
Before turning the call over for questions, I'd like to comment briefly on the current environment in China. We believe that consumer sentiment improved in China during the second half of 2019, and particularly the fourth quarter. That said, we are obviously monitoring the Coronavirus situation in China on a day-to-day basis for the rest of the world, as we try to gain more visibility into the potential impact this dynamic could have of our employees, customers, and overall business as we come out of the extended Chinese New Year holiday.
As noted in our outlook and earnings press release issued yesterday, we are committed to providing transparency on this evolving situation. And any impact to our business we gain more visibility -- as we gain more visibility into the situation. I do, however, want to emphasize our confidence in our China business and our long-term growth opportunity here. Lastly, we issued a release this morning announcing that the Board has authorized an additional $100 million in share repurchase authorization. This is in addition to the $30 million currently authorized, bringing the total authorization to $130 million.
With that, I'll now ask the operator, please open the lines for questions.
Questions and Answers:
Operator
Thank you. [Operator Instructions] We'll take our first question from Doug Lane with Lane Research.
Doug Lane -- Lane Research -- Analyst
Yeah. Hi. Good morning, everybody. Just want to start with sort of what you mentioned about China and the Coronavirus. The outlook for 2020 was a very wide outlook, much wider than you've given in the past. And I'm sure it's the uncertainty about China and the Coronavirus. But also the sales performance was good in the third quarter and the fourth quarter, but it sounds like there were sort of one-off promotions really to try to jump-start things after the weak start to the year. So how much of that wide range next year is because of the underlying business may not be back to where you want it, and how much of that is because of the uncertainty on the Coronavirus?
Doug Hekking -- Chief Financial Officer
Yes. Doug, this is the other Doug. The wider range is almost entirely attributed to kind of the uncertainty surrounding kind of the emergence of the Coronavirus. And really, it's very tough to get visibility, why we're in kind of prolonged Chinese New Year period. And so it just hasn't really been able to go back and get any early indicators as far as what that means to us. And so I think it's hopefully, out of an abundance of caution, but that's what it relates to. As it relates to the promotions, we're going to -- we're a sales organization. And the way, we grow is having families and individuals, more of those individuals take our products. And so we'll still be doing ongoing promotions and it's just part of our business. We have been a little bit more intentional during kind of the recovery of the consumer sentiment in China. And you'll see some more of that going forward. But that's really just part of our business.
Doug Lane -- Lane Research -- Analyst
Okay. That's helpful. And then, Kevin, getting back on your customer-centric strategy. You've got a huge infrastructure of associates, which built the business. And like many of your peers, I understand the shift to targeting the end consumer and the end user with the promotions, but how do you strike that balance? And does this change in strategy -- well, not change, but this nuance in strategy to go to customer-centric, is that going to require a plea to the compensation plan?
Kevin G. Guest -- Chief Executive Officer and Director
So, as we think about interacting with a company. If you think about how you did your Christmas shopping this year. I'm sure it was much different than you did a few years ago. And it's not unlike our customer base, they want to and expect to interact differently as they receive their interaction and products through USANA. The customer strategy has more to do from a technology, ease of interaction and doing business than it does a compensation plan strategy change. We are wholly 100% committed to our direct sellers who are out there with their businesses.
And we're going to find ways to help complement their business that is additive to what we're doing and adding to their overall possibility for success because what it comes down to is more customers consuming more products in their business equals success for them and for us. And so I mentioned an expanded product offering in a new product line. That's part of that customer-centric strategy by not being so laser-focused in a certain category, but expanding in the health arena, other product offerings that our business owners can sell is part of that strategy as well.
And so, we are not moving away from by the statement of a customer-centric. We're not going direct to consumer as our business model. We are going to find creative ways through technologies, through product strategies and sales. I think pricing strategy is part of the equation and interaction with the end user. But for right now, we're going to make it easier for people to do business with USANA as a whole. But again, we're not going to take those profits internally. We're going to still continue to find ways to incentivize customer acquisition and sales through our direct sales channel.
Doug Lane -- Lane Research -- Analyst
And will this require a change in compensation plan?
Kevin G. Guest -- Chief Executive Officer and Director
Well, we have constantly over the years done things. An example is the Celavive. You could call it a compensation plan change by having this 25% bonus to incentivize them to enroll preferred customers. If you're calling that a compensation plan change. The answer would be, yes. But we're going to do different sales strategies to incentivize acquisition. But again, we're going to make sure that we're going to include those who are involved in activities of bringing customers to USANA.
Doug Lane -- Lane Research -- Analyst
Okay. That's helpful. And just one last thing. Just -- I noticed that Dr. Wentz left the Board and as the founder of the company and spiritual leader. I wonder what the impact is on the relationship between corporate and the sales leaders. And then also, he's still a big stockholder. Do you know of any plans for his stock?
Kevin G. Guest -- Chief Executive Officer and Director
So, I've been literally home, I think, two or three days this year, out traveling meeting with our distributors. So I started the year off in China. Been all over. I'm leaving this afternoon for other markets around the world, meeting face-to-face with our sales, associates, and leaders. We had over 6,000 people in Korea. When I was just there a few weeks ago. And part of that was to talk about the transition of Dr. Wentz, his message to the world which is -- which are our expectations is that, he will continue to give input and guidance from a scientific perspective in the company and that he will continue to play a role in USANA going forward. It's a transition for him where he's not coming in for Board meetings and conducting Board business.
But my expectation is that, from what he has told us and as a company that he will continue at some level is involved with USANA. It's being very well received. He is 80 years old this year. And what we -- what I'm finding, as I travel and talk to our customers, they are thankful that we are being very thoughtful and planning and thinking ahead from a transitional strategy with Dr. Wentz and not waiting and letting it go on until he passes away. And then all of a sudden we have an instance on our hand what will we do? This is part of a strategic plan that's been in process and under way for quite some time. And we're continuing to execute on that strategy and that plan.
Doug Lane -- Lane Research -- Analyst
And any comment with regards to his stock holdings, has he made any comments?
Kevin G. Guest -- Chief Executive Officer and Director
I would -- I don't want to speak for Dr. Wentz. That's a personal issue. He has -- everything that he has said to me, and I don't think he would mind me saying this publicly -- even as soon -- as of yesterday, he intends on being an active participant and a significant shareholder as of yesterday in USANA.
Doug Lane -- Lane Research -- Analyst
Okay. Thank you.
Operator
We have no more questions in the queue at this time. I would like to turn the conference back over to Patrique Richards.
Patrique Richards -- Executive Director of Investor Relations and Business Development
Well, thank you for your questions and for your participation on today's conference call. If you have any remaining questions, please feel free to contact Investor Relations at 801-954-7961.
Operator
[Operator Closing Remarks]
Duration: 15 minutes
Call participants:
Patrique Richards -- Executive Director of Investor Relations and Business Development
Kevin G. Guest -- Chief Executive Officer and Director
Doug Hekking -- Chief Financial Officer
Doug Lane -- Lane Research -- Analyst
