About USANA Health Sciences

USANA Health Sciences, Inc. is a global direct-selling nutrition, personal health and wellness company. In 2022, the company had approximately 490,000 active Customers worldwide. The company has operations in 24 geographic markets worldwide, where it distributes and sells its products by way of direct selling. Mainland China (China) is the company’s largest market and single largest source of revenue, representing approximately 45.4% of net sales and approximately 45.9% of active Customers. The company distributes its products through the direct selling channel. The company’s customer base primarily consists of two types of customers: Associates and Preferred Customers” referred to collectively as active Customers. The company’s Associates also sell its products to retail customers. Preferred Customers purchase the company’s products strictly for personal use and are not permitted to resell or to distribute the products. Distribution and Marketing The company distributes its products internationally through direct selling, which entails person-to-person marketing and selling of products. Structure of Direct Selling Program Although the company’s direct selling philosophy and strategy are generally consistent in its markets around the world, certain aspects of its business may differ from market to market as a result of different legal and regulatory regimes, operational requirements or other factors. The company operates its business in China through BabyCare Holdings, Ltd. (BabyCare). Strategy In 2023, the company plans to execute its global growth strategy, which remains focused on increasing the number of active Customers in each of its markets. The company plans to do this by continuing to advance its digital commerce initiatives to support its business; executing market specific promotional and incentive strategies; continuing to pursue product development and further leveraging its foods manufacturing facility; focusing on its China market and its customer base in that market; pursuing growth through international expansion; and advancing its business development strategy by growing the two companies it acquired in 2022, and evaluating new acquisition opportunities. In 2023, the company will continue to pursue market-specific strategies to facilitate customer growth and strengthen its business around the world. Listed below are some of the strategies it plans to execute on a market-specific basis. Shifting its focus from large, world-wide incentive offerings to strategically timed, market- and region-specific efforts to incent sales and customer growth. Continuing to offer product promotions to increase product demand and drive customer growth. Returning to in-person events and Associate incentive trips where possible. Examples of these events include its China National Meeting and Asia Pacific Convention, which are both scheduled for the second quarter of 2023. Increasing the number of in-person meetings and improving collaboration amongst its management team and Associate sales force. Refocusing the company’s Associate sales force on promoting the science-based differentiation of USANA's products, which includes its proprietary InCelligence Technology. InCelligence is the company’s patented technology that supports the body's natural ability to nourish, protect and renew itself. In 2023, the company plans to continue to invest in research and development and product innovation to ensure that USANA remains a leader in clinical nutrition. The company also plans to roll-out new science-based products in 2023 and over the next several years. Some of the strategic initiatives in China that the company executed in 2022 and plans to continue to advance in 2023, includes: Advancing the company’s research collaboration with Beijing University of Chinese Medicine (China). Investing in the company’s branch office redesign strategy, which will enhance the customer experience, as well as contribute to increased customer activity and retention. Advancing and expanding the company’s digital capabilities, which entails continued digital investments to improve the overall customer experience. Continuing to advance and build upon collaborations and partnerships. The company is continuing its partnership with the National Sports Training Bureau and it is looking for additional partnerships to promote its new Active Nutrition line. The company also continues to work closely with Beijing University of Chinese Medicine (China) and it hopes to have meaningful results from many of these projects and to start commercializing products as soon as possible. Products USANA Nutritionals Optimizers: Consists of targeted supplements designed to meet individual health and nutritional needs. These products support needs, such as cardiovascular health, skeletal/structural health, and digestive health and are intended to be used in conjunction with the Essentials/CellSentials Essentials/CellSentials: Includes core vitamin and mineral supplements that provide a foundation of advanced total body nutrition for every age group beginning with children 13 months of age. Foods: Includes meal replacement shakes, snack bars, and other related products that promote healthy weight management, digestive health, energy and hydration through a holistic approach. These products can be used along with Essentials and Optimizers to provide a complete and healthy diet and sustained energy throughout the day. Personal care and Skincare: Includes the company’s premium science-based personal care products and Celavive, its innovative skincare system formulated with its USANA InCelligence Technology. Celavive offers a comprehensive skincare regimen benefiting multiple skincare types and ethnicities, upgraded science, and more noticeable user benefits. All Other: Includes materials and online tools that are designed to assist our Associates in building their businesses and in marketing the company’s products. In addition to the products, the company offers products designed specifically for prenatal, infant, and young-child age groups in China. As it continues to focus on innovation, the company will look for innovative product opportunities, such as its Celavive and Active Nutrition product lines. Geographic Presence The company has ongoing operations in the following markets, which are presented in two geographic regions the Asia Pacific, and Americas and Europe. Asia Pacific is further divided into three sub-regions: Greater China, Southeast Asia Pacific, and North Asia. The countries included in these regions and sub-regions are described below: Asia Pacific Asia Pacific is organized into three sub-regions: Greater China, Southeast Asia Pacific, and North Asia. Markets included in each of these sub-regions are as follows: Greater China - Hong Kong, Taiwan, and China. The company’s business in China is conducted by BabyCare. Southeast Asia Pacific – Australia, New Zealand, Singapore, Malaysia, the Philippines, Thailand, and Indonesia. North Asia – Japan and South Korea Americas and Europe Americas and Europe – United States, Canada, Mexico, Colombia, and Europe (the United Kingdom, France, Germany, Spain, Italy, Romania, Belgium, and the Netherlands) Research and Development In fiscal year 2022, the company expended $11.6 million on product research and development activities. Competition The company competes with other public and privately owned global network marketers for distributor talent, including for example Amway, Herbalife, and Nu Skin. Major Customers The company sells product to independent Associates and Preferred Customers. Intellectual Property Trademarks The company owns 28 trademarks that are registered with the U.S. Patent and Trademark Office. Federal registration of a trademark enables the registered owner of the mark to bar the unauthorized use of the registered mark by a third party in connection with a similar product in similar channels of trade anywhere in the United States, regardless of whether the registered owner has ever used the trademark in the area where the unauthorized use occurs. The company has filed applications and own trademark registrations, and it intends to register additional trademarks in countries outside the United States where USANA products are or may be sold in the future. Patent The company owns U.S. Patent 10,632,101 for its InCelligence complex formula. This patent was issued in 2020. Seasonality The company experiences variations in the activity of its customers in many of its markets in the first and fourth quarters (year ended December 31, 2022) around major cultural events, such as Chinese New Year and Christmas. Regulatory Matters The company’s largest selling product group includes products that are regulated as dietary supplements under the Food, Drug, and Cosmetic Act, as amended (FDCA). Some of the company’s powdered drink, food bar, and other nutrition products are regulated as foods under the Nutrition Labeling and Education Act of 1990, as amended (NLEA). The company is audited annually by the U.S. Food and Drug Administration (FDA), specifically for dietary supplements and have been found in compliance with Good Manufacturing Practices (GMPs) for dietary supplements. In general, its personal care and skincare products, which are regulated as cosmetic products by the FDA. Advertising of the company’s products in the United States is subject to regulation by the Federal Trade Commission (FTC) under the FTC Act. History USANA Health Sciences, Inc. was founded in 1992 by Myron W. Wentz, Ph.D.

Country
Industry:
Pharmaceutical preparations
Founded:
1992
IPO Date:
11/02/1994
ISIN Number:
I_US90328M1071
Address:
3838 West Parkway Boulevard, Salt Lake City, Utah, 84120, United States
Phone Number
801 954 7100

Key Executives

CEO:
Brown, Jim
CFO
Hekking, G.
COO:
Noot, Walter