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Very Strong Financially; Large Growth Opportunity Ahead

LifeVantage participated in WTR’s Consumer Products Virtual Investor Conference on June 5, 2024. Representing the company were CEO Steve Fife and CFO Carl Aure. This report contains a transcript of the conversation, which can be accessed on demand. Link accessible in our full report. Management noted that LFVN remains over-indexed in the US (77% of total company sales) versus the total Direct Selling Channel with the US at 38% of global sales. Conversely, Asia is under-indexed at 21% of company sales versus 41% of the global direct selling market. Therefore, management sees tremendous growth opportunities in that region despite recent performance that has been below expectations, particularly in Philippines, Australia, and Thailand, due primarily to the loss of some field leadership. However, the company has made some personnel changes and brought in new leaders to help stabilize and then grow those markets. LFVN’s China region, conversely, grew 19% in the most recent quarter, mostly driven by strong leadership in Taiwan, which was driving the growth there. The company recently shut down its e-commerce business in Mainland China, and it is more focused on growth in the surrounding markets, which also include Singapore and Hong Kong. LFVN’s new Evolve compensation plan appears to be working in bringing in individuals who want to sell products, not just build teams, which is the more traditional direct selling model. They tend to be a younger demographic, many of whom have never known what a 9 to 5 job is. The company is leaning into the new compensation plan to broaden its appeal, and thereby stem the recent decline in its active accounts. Liquid Collagen, after a very successful launch in the US two years ago, may be close to peaking in its customer penetration. LFVN has shifted focus toward including Liquid Collagen in its core enrollment messaging. It is also pairing it with the patented flagship Protandim Nrf2 supplement, including having a patent pending on the pairing of the two technologies. LFVN was featured in a 25-page article in Newsweek. It was featured in the natural supplement part of the story due to its activation messaging. Its products activate the body’s ability to produce antioxidants, which are essential to fight free radicals. LFVN initiated a regular dividend two years ago in the June quarter, and has raised it each year since, so that the current dividend payment is 33% higher than where it was when initiated. The company has a $60 million share buyback authorized, of which $22 million is remaining. Capital spending has been elevated over the past two years with the rollout of its LV360 initiatives, but it should settle down into the $1.5-2 million range going forward. LFVN paid a $0.40 per share special dividend last September, and that remains in the arsenal as another vehicle to return capital to shareholders. The company has no debt and $1.34 per share of cash on its balance sheet. WTR held its inaugural Consumer Products Virtual Investor Conference on June 5 and 6. Presentations are available on demand via a link in our full report and 1x1 requests can be sent to .