Depending on who you are talking to, you can get various responses to this question. Some would say a fortune is possible, while some others would tell that one can make a pocket money at most.
There are also others who take their stands on extremes, of course. Those on one end claim that a fortune is guaranteed and people on the other extreme say it is not possible to earn literally anything with network marketing.
But we have data from companies disclosing how much they pay to their representatives. Let’s check a few of them.
LifeVantage is a NASDAQ traded company which uses a network marketing business model to market and sell it’s propiatary product line. On or about December 5th, 2012 the management of LifeVantage was informed of a possable contamination of their flagship product Protandim and took immediate messures to correct the issue. Below is additonal information provided by the company in their official press release and from 3rd party sources.
Protandim® theNrf2 Synergizer® Product Recall
Recall date: December 5, 2012
Safety is Always our top Concern
LifeVantage is dedicated to ensuring the safety of all our products. We will always stand firm in our position to never compromise safety for any gain or advancement. We will continually operate with the utmost integrity so that our consumers can be assured we have their best interest at heart.
LifeVantage is also devoted to providing the highest quality products for the health of our distributors and customers. The company has stringent guidelines in product production and is committed to operating with industry-leading quality control systems so that every product exceeds the expectations of our customers.
On December 5, 2012, LifeVantage announced a voluntary recall of certain lots of Protandim® due to possible inclusion of small metal fragments in the final product. In partnership with medical experts, LifeVantage believes these materials pose no serious health risk to customers’ health. This proactive action has occurred in an effort to alleviate concerns about potentially affected product.
What Product is Affected by This Voluntary Recall?
Not all Protandim bottles are subject to this recall. Only certain lots, or batches, of Protandim are being recalled. Lot numbers are located on the left side of the product label when looking at the front of the label, directly above the RFID scan bar. Lot numbers affected are:
Lot# and Expiration Date
What Steps Should I Take if I Have Product Affected by the Voluntary Recall?
Consumers who have received bottles of Protandim from the lot numbers identified above should discontinue use of the affected product and immediately call LifeVantage Customer Service toll-free, 24 hours a day, seven days a week, at 866-912-9051 for instructions on how to receive replacement product, or click here to complete a form online.
As always, if you have a medical emergency, you should contact your medical provider.
LifeVantage Corporation is recalling select lots of Protandim®, the Nrf2 Synergizer® dietary supplement because there may be small metal fragments in the final product. The fragments were discovered in batches of turmeric extract, an ingredient that came from a third party supplier.
The supplement is packaged in a cylindrical blue bottle, with 30 caplets per bottle. You can see the lot numbers and expiration dates at the FDA web site. The supplements were distributed in the United States and Japan between July and November 2012.
After consulting with doctors, the company believes there is no serious risk to consumer health. There have been no reports of illness or injury associated with the consumption of this product. If you have purchased this product, stop taking it. For questions, call LifeVantage directly at 1-866-912-9051 seven days a week, 24 hours a day.
This week’s MLM news, covers some great information and some not so great news. But all in all the Network Marketing Community is growing and this last quarter of 2012 should be some history making times.
Primerica profit beats estimates on robust term insurance sales Source: Primerica.com
By Aman Shah, Edited by Sriraj Kalluvila
Reuters, August 7, 2012
Life insurer Primerica Inc’s (PRI) quarterly profit rose 23 percent and came in above Street estimates on strong sales at its term-life insurance segment.
Net income for the company, which was spun off from Citigroup Inc (C), rose to $46.2 million, or 73 cents per share, for the second quarter, from $37.6 million, or 49 cents per share, a year earlier.
Operating income, a key measure of profitability for insurance companies as it excludes investment gains and losses, was 71 cents per share.
Analysts on average expected Primerica to earn 65 cents per share, according to Thomson Reuters I/B/E/S.
The company, which has been buying back shares from large stakeholders to have greater control over its operations, also authorized a share buyback program of up to $75 million.
Term-life insurance sales rose 24 percent to $162.7 million, while operating income at the segment was up 44 percent to $51.7 million.
Shares of the company closed at $27.17 on Tuesday on the New York Stock Exchange.
Representative Pete Sessions Honored with Champion of Free Enterprise Award. Source: Direct Selling Association
Direct Selling Day at the U.S. Capitol, featuring more than 50 meetings between direct selling executives and Members of Congress and their staffs, culminated with awarding Rep. Pete Sessions (R-TX) with the Champion of Free Enterprise Award in recognition of his ongoing commitment to and support of policies that protect the interests of the millions of micro-entrepreneurs working as direct sellers in the U.S.
“Congressman Sessions understands the business community—how government can both protect and foster the growth of direct selling,” said DSA President Joe Mariano. “Over the years, he has been a trusted friend of direct selling… he understands the vital role direct selling plays in the American economy. He is an influential and trusted voice in Congress and today, [he is] a Champion of Free Enterprise.”
Rep. Sessions expressed his excitement for the award and thanked members of the direct selling industry for their continued commitment to their communities, as well as their contributions to the American marketplace.
“I understand where you’re coming from and I believe in what you’re doing,” he said. “The American Dream is about guaranteeing opportunities, not outcomes. It’s about making sure you can work to better your own life and the lives of those around you. I’m very proud to be associated with you. You, too, get the [Champion of Free Enterprise] award every day by making lives better for a lot of people.”
This presentation took place during an ice cream social on Sept. 12, to which all Members of Congress and their staffs were invited. Hundreds attended and enjoyed ice cream while browsing by a number of displays featuring company products and consultant profiles.
The ice cream social was the culmination of a day of meetings across Capitol Hill, as almost 40 member executives met with Members of Congress to introduce them to their companies and the direct sales channel.
“Direct selling is about my independent saleswoman having the freedom to operate her own business as she chooses—it’s up to her,” observed Nathan Moore (Mary Kay) during a meeting with Senator John Thune (R-SD) and his staff. “It’s the American dream especially for women entrepreneurs,” noted DSA Membership Director Nancy Burke. “We are the original social network.”
Independent contractor status, looming Department of Labor regulations, worker’s compensation and Internet tax laws all played roles in the various conversations teams of executives had throughout the day. Additionally, DSA executives, Members of Congress and their staff members discussed the impact of small businesses on the U.S. economy and the importance of ensuring opportunities for success and prosperity are available across all demographic sectors.
Among the day’s meetings, Rep. Gene Green (D-TX) spoke with member company representatives and DSA Executive Vice President Adolfo Franco about the opportunities direct selling provides. Rep. Green even shared the story of his personal connection to the industry through a friend who operated his own business with Primerica in Texas’s 29th Congressional district.
“While we’re largely a manufacturing district—we have a lot of refineries and big businesses—we also have a lot of smaller businesses,” Rep. Green said. “What I have to say is this—direct selling is a part of America. I know the role you play in the economy and I’ve seen it firsthand through [my friend’s] successes.”
Direct selling executives and DSA staff emphasized over and over again that while no current proposals were on the table—”There is no specific ‘ask’,” Joe stated—the message they were bringing to legislators was the value of independent contractor status, and the damage any changes to that would cause the nearly 16 million sellers across the country—an average of 36,000 of whom are in each Congressional district.
The excitement executives carried with them to their meetings was palpable throughout their interactions. “We’re proud to be here,” noted Angela Chrysler (Team National) to Rep. Judy Biggert (R-IL). “We’re excited to support our sales channel. The majority of our businesses are women-owned, and we’re pleased we can represent that constituency today. The economy remains a troubling point across the country, but direct selling is part of the solution.”
Additionally, those who participated in this year’s Washington, D.C., Direct Selling Day recognized the value in outreach to representatives of Congress, as well as the importance of sharing personal accounts of how direct selling empowers countless men and women throughout the country. As Policy Advisor to Rep. Tom Price (R-GA) Kyle Cormney stressed, “It is crucial that (direct sellers) go around and share their personal stories and experiences with members of government and those who are unfamiliar with the industry. As more people see the human stories behind direct selling, more people will understand the impact you have.”
The camaraderie among those who participated in this year’s Direct Selling Day on Capitol Hill was evident.
“The day’s events provided an outstanding opportunity for each of us to come together to partner with so many member companies for one common cause—to help members of government understand the role direct selling plays in empowering others to achieve their goals,” added Michelle Merriwether, Vice President of U.S. Field Development for USANA.
Female Direct Sales Leaders Gather in Washington, D.C. Source: Direct Selling Assication
More than 20 female CEOs from a variety of direct selling companies gathered in Washington, D.C., this week to network and learn from each other, as well as to take part in the association’s Direct Selling Day on the Hill, providing Members of Congress with a unique, female perspective about what makes direct selling such a special sales channel.
“I love hearing from these women around the table!” said Susan Handley, President and Founder of Beijo. “If my story has value, that’s great, but I’m really here to learn and observe and get as much out of this as I can—it’s such a great opportunity to be here!”
This was the second such retreat planned for the sales channel’s female CEOs—individuals who understand uniquely the challenges the majority of the field faces as they try to juggle family and work obligations.
“We talk all the time about how being a direct seller offers women, in particular, a specific opportunity to create a better life for themselves and their families by working their own hours and feeling empowered by what they do. But what about the female CEOs at the top of companies? Where do they feel empowerment, especially having chosen the more traditional 9-5 option?” commented DSA Membership Director Nancy Burke. “Last year’s retreat was a powerful event for these CEOs and we felt compelled to offer it a second time so we could continue to provide these exceptional leaders in our industry with a networking and learning opportunity specifically for them.”
When joined by Karen Maples (non-member Myutiq), learning from one of their own—Meg Sheetz (Take Shape for Life)—as well as hearing from Costa Rican Ambassador to the U.S. Muni Figueres, attendees had an opportunity to enjoy female success stories and learn from others’ experiences.
“I am a woman who owns my own direct selling company in southwest Missouri—there’s no one around me like me. I need to go to a DSA meeting like this for a peer group,” noted Nancy Bogart, CEO of Jordan Essentials. “You can’t build relationships at home in a vacuum.”
The second day focused entirely on issue advocacy, as the women broke out into teams and engaged with Members of Congress on Capitol Hill, introducing them to direct selling and to their companies, all the while bringing the conversation back to the special perspective females have to offer legislators—and the effects the decisions of those legislators have on the women and families in their states.
“We’re representing the women who sell for us,” Nancy Bogart stated during one of the briefings. “We’re making our communities and the economy stronger. Direct selling is represented by the faces of women out there selling many products in many communities. We create these jobs and we want to protect their independent contractor status, and really preserve the American dream!”
Six Ways to Build Momentum
Have you ever taken on a project that seems so complicated you don’t even know where to begin? Once you do get into it, though, you often find yourself “in the zone” where you’ve built up so much productive momentum that you feel unstoppable. The creative juices are flowing and you’re accomplishing tasks left and right. This is a great feeling, but getting there can sometimes prove to be extremely difficult. Here are some suggestions to help you get to that point with built-up momentum and maximum productive potential.
Put first things first. You may have several things to do, but tackling the most challenging task first can help you accomplish what you need to when you are freshest, starting your day. So make a list of what needs to be done, and then prioritize the list so that the most important tasks are the ones you do first. This can help you avoid distractions and help you get things done.
Remember that you are in control. You are your own boss. Although that fact does come with its fair share of stress and responsibility, it also comes with the freedom to schedule your workday to accomplish your most important tasks. Maximize the benefits of being in control by delegating tasks to team members when possible. Ask for help when you need it, and take breaks when you are feeling too overwhelmed. Sometimes, just the thought of being in the driver’s seat of your business is enough to get you through a difficult project.
Mute the negative thoughts and stay positive. You’ve no doubt heard about the power of positive self-talk. Not surprisingly, negative self-talk is just as powerful, so it’s important that you tune it out. Anytime you catch yourself having a negative thought, remember that it is only hindering your productivity, not helping it. Replace it with a positive thought or motivational message. Positivity goes a long way in building the momentum you need to accomplish your goals.
Stay focused and avoid distractions. What types of things distract you from working on the task at hand? Is it the Facebook and Pinterest buttons on your toolbar that lure you away from the task at hand? Maybe you should hide the toolbar when working. Reward yourself with some “fun” time on your social networks when you’re done with your project. Distractions come in all shapes and sizes, so identify what distracts you and put yourself in a situation where they don’t get in your way. Remain focused on your desired endgame to maintain your momentum.
Avoid negative people. Some people just default to negative behavior: constantly complaining, persistently blaming others, and always having a reason they don’t succeed. These people should not be in your immediate circle, and they certainly shouldn’t work for you, as they may bring down not only you but your team as well. Surround yourself with people who will be your cheerleaders and who are as goal-oriented as you are. You will be much better equipped to build your momentum with positive people around you.
Keep a daily/weekly accomplishment tally. The busier our lives become, the harder it gets to remember what we actually accomplished by the end of the day or week. Keep some sort of tally or list to remind you what you completed and motivate you to continue. Such a record will also serve show you how much you are really accomplishing on a regular basis.
Building momentum is crucial to continuous goal accomplishment in your business. Have you used these strategies in the past? How have they helped you? What else should be added to our list? Please share your ideas in the comments section below!
MLM Company News
Ambit Energy recently held its sixth annual conference, “Ambition 2012: Take Charge,” in Dallas. More than 9,000 independent consultants attended over a span of five days. It is estimated that the event had an economic impact of $10 million on the Dallas area. The company also announced it will be expanding in California, Illinois and Pennsylvania.
AtHome America has gone out of business.
For the third year, Amway is continuing its support of the Boys & Girls Clubs of America with a $1 million donation to support community gardens and healthy habits for children throughout the U.S. As a part of the partnership, Amway’s POSITIVE SPROUTS® program teaches kids how to plant and maintain their own edible gardens. An accompanying curriculum educates youth about nutrition, organic gardening practices and cooking from the garden.
Amway is providing $30,000 in Sustainability Grants to 10 deserving Boys & Girls Clubs who previously received community gardens from Amway. The funds are designed to assist Clubs with the maintenance of their gardens. The direct selling company is also donating 150 “Garden In A Box” kits to Boys & Girls Clubs that demonstrated an interest and need for establishing a community gardening program at their Club. The kit includes a variety of fruit and vegetable seeds and supplies Clubs need to get started. Additionally, Amway is enabling the delivery of a healthy food curriculum to 4,000 Boys & Girls Clubs nationwide, ensuring all Clubs have access to educational materials promoting healthy eating habits.
Gigi Hill has planned a tour to introduce the company and its founders to five new cities this fall. Founders Gabrielle DeSantis-Cummings and Monica Hillman will take the Gigi Hill Fall 2012 Roadshow to Virginia, Maryland, Florida, Michigan and Illinois this October.
LifeVantage has announced that its common stock has been approved for listing on the NASDAQ Capital Market. Shares commenced trading under its current ticker symbol, “LFVN,” earlier this week. Prior to the listing of its common stock on the NASDAQ Capital Market, the company’s common stock was traded on the OTC Bulletin Board.
In additional company news, LifeVantage reported its financial results for the fourth quarter and full year ending on June 30, 2012. For the fiscal 2012 fourth quarter, compared to the same period last year, net revenue increased 197 percent to $44.6 million; operating margin increased to 16.5 percent compared to 13 percent; and operating income grew 275 percent to $7.3 million. Fiscal 2012 full-year highlights, compared to fiscal 2011 full-year, include: net revenue increased 224 percent to $126.2 million; operating margin increased to 17 percent compared to 9.5 percent; operating income grew 480 percent to $21.5 million; and cash and cash equivalents grew to $24.6 million as of June 30, 2012 from $6.4 million as of the prior year-end.
FORTUNE magazine recently released its list of the Top 100 Fastest Growing Companies. Medifast, parent company of member company Take Shape for Life, is no. 46 on the 2012 list.
Neways Europe was awarded an official certificate of recognition by the Grüner Punkt (Green Dot) recycling program for reducing its greenhouse gas emissions by 12.56 kilograms of carbon dioxide in 2011, approximately equal to the annual carbon dioxide emissions generated by seven two-person households. Green Dot is the flagship recycling program of Duales System Deutschland (DSD), a Germany-based recycler.
XANGO recently celebrated its 10th anniversary with a gathering of several thousand distributors in Las Vegas. In those 10 years, the company’s salesforce has grown to have more than 2 million distributors, it’s operating in 43 countries and making more than $2 billion in cumulative revenue.
UNITED STATES DISTRICT COURT EASTERN DISTRICT OF KENTUCKY CENTRAL DIVISION
CIVIL ACTION NO. 10-305-JBC
YVONNE DAY, et al., PLAINTIFFS, V. MEMORANDUM OPINION & ORDER
FORTUNE HI-TECH MARKETING, et al., DEFENDANTS.
* * * * * * * * * * *
This matter is before the court upon the plaintiffs’ motion to alter or amend the court’s order compelling arbitration and dismissing this action, R.67. For the following reasons, the court will grant the motion.
The plaintiffs, as former individual representatives (“IRs”) of Fortune Hi-Tech Marketing, Inc. (“FHTM”), filed suit against the defendants, including FHTM, FHTM officers, and other individuals, for alleged violations of Title 18 U.S.C. § 1961-
1968 “RICO” laws, the Kentucky Consumer Protection Act under KRS § 367, and Kentucky common law torts. The defendants moved to compel arbitration of the claims, and the court granted the motion, dismissing the action and submitting all of the claims to arbitration.
The plaintiffs now ask the court to reconsider on four grounds: (1) that the court has jurisdiction to address the issue of whether the alleged arbitration agreement was supported by consideration; (2) that the court should not apply the
FAA presumption favoring arbitration to its analysis of whether an agreement was formed; (3) that the FHTM sponsors had no actual implied authority to bind the plaintiffs to an arbitration agreement and that the plaintiffs are entitled to a jury
trial on any factual disputes; and (4) that the plaintiffs did not ratify their contracts with FHTM. The court reviews the motion under Fed. R. Civ. P. 59 (e) for a showing of “(1) a clear error of law; (2) newly discovered evidence; (3) an intervening change in controlling law; or (4) a need to prevent manifest injustice.” Henderson v. Walled Lake Consol. Sch., 469 F.3d 479, 496 (6th Cir. 2005). Upon review, the court finds that it has jurisdiction to address the issue of whether the alleged arbitration agreement was supported by consideration and will analyze the issue accordingly. The court will also clarify its position on the FAA presumption favoring arbitration. However, because the court finds that the alleged arbitration agreement was not supported by consideration, it will not review the issues of implied authority and ratification; rather, it will rescind its prior findings on those issues.
The court has jurisdiction to address the plaintiffs’ consideration argument because “where the dispute at issue concerns contract formation, the dispute is generally for courts to decide.” Granite Rock v. Int’l Brotherhood of Teamsters, 130
S. Ct. 2847, 2855-2856 (2010). The court previously erred in applying Buckeye Check Cashing v. Cardegna, 546 U.S. 440, 445-46 (2006), which involved a challenge to an existing agreement rather than a claim that no arbitration
agreement was reached. “Every contract requires mutual assent and consideration,” so an inquiry into consideration is part of the contract-formation analysis. Cuppy v. Gen. Accidental Fire & Life Assurance Corp., 378 S.W.2d 629,
632 (Ky. 1964); see also Cantrell Supply v. Liberty Mut. Ins. Co., 94 S.W.3d 381,
384 (Ky. App. 2002). Even though the plaintiffs’ argument – that the FHTM policies and procedures document is illusory and lacks consideration – implicates the entire alleged contract between the parties and not just the arbitration agreement, see Moran v. Svete, 366 Fed. Appx. 624, 631 (6th Cir. 2010), the court has jurisdiction under Granite Rock to review the consideration dispute because it concerns contract formation. Even though the federal presumption in favor of arbitration is taken into consideration when making determinations on the scope of arbitrable issues, see Moses H. Cone Mem’l Hosp. v. Mercury Constr. Corp., 460 U.S. 1, 24-25 (1983), the court will not apply that presumption to the discussion of whether an arbitration agreement was formed, see Granite Rock, 130
S. Ct. at 2858 (2010). The court erred in doing so in its prior opinion.
Because the FHTM policies and procedures authorize FHTM to amend the Agreement — meaning, collectively, the FHTM application and agreement, the FHTM trainer/coach agreement, the policies and procedures, and the marketing and compensation plan — at any time in its sole and absolute discretion, the agreement to arbitrate is illusory and lacks consideration. “Consideration is an essential element of every contract.” Floss v. Ryan’s Family Steak Houses, Inc., 211 F.3d
A promise may act as consideration but only if “it creates a binding obligation” on
each promisor. Id. (citing David Roth’s Sons, Inc. v. Wright and Taylor, Inc., 343
S.W.2d 389, 390 (Ky. Ct. App. 1961)). When the promisor has no true fixed obligation to perform, the contract is illusory and lacks consideration. See David Roth’s Sons, Inc., 343 S.W.2d at 391. In this case, FHTM has no fixed obligation to arbitrate. Even though both the FHTM application and agreement and policies and procedures contain arbitration agreements, the policies and procedures (which are incorporated into the application and agreement, R.1-2, p.7, and supersede and prevail over any conflicting terms in the application and agreement, R.27-1, p.4), provide FHTM the sole discretionary authority to amend FHTM documents at any time. R.1-2, p.7.
By retaining the right to amend the documents “in its sole and absolute discretion,” FHTM has no binding obligation to arbitrate. R.1-2, p.7; see also David Roth’s Sons, Inc., 343 S.W.2d at 390 (Ky. Ct. App. 1961). At any point, after providing only notice of the amendment, FHTM could amend the policies and procedures or the application and agreement to either alter or remove entirely the arbitration agreements. This means that the unilateral-amendment provision of the policies and procedures renders illusory any alleged promise to arbitrate by FHTM, and FHTM’s promise to arbitrate cannot act as consideration for the arbitration agreement. Floss, 211 F.3d at 315 (6th Cir. 2000); see also Daniel Boone Coal
Co. v. Miller, 217 S.W. 666 (Ky. 1920).
The agreement to arbitrate is illusory despite the requirement that FHTM
must provide notice to IRs of any amendment to the application and agreement or policies and procedures documents. A notice provision can constitute sufficient consideration for an otherwise illusory contract by limiting a party’s ability to unilaterally amend or terminate an agreement, see Morrison v. Circuit City Stores,
317 F.3d 646 (6th Cir. 2003); see also Seawright v. Am. Gen. Fin., Inc., 507 F.3d
967 (6th Cir. 2008). The provision at issue, however, does not provide for advance notice. Amendments to any of the FHTM documents are “effective upon notice to IRs that the Agreement has been modified.” R.1-2, p.7. Notice is accomplished by publishing the amendment in official FHTM materials, including posting it on the FHTM website, e-mailing it to IRs, broadcasting it over voice mail, or including it in FHTM periodicals. Notice is “deemed received by the IR upon posting.” R.1-2, p.7.
The FHTM agreement is distinguishable from the agreement in Morrison, which was upheld, because in that case an employer had the authority to alter or terminate an agreement at the end of each year only “upon giving thirty days’ notice [of the amendment or termination] to its employees.” Morrison, 317 F.3d at
667 (6th Cir. 2003). The thirty-day provision is significant because the Morrison court found that it provided enough of a limitation on the employer’s ability to terminate or amend the agreement to constitute consideration. Id. The notice provision was a promise “to maintain the arbitration agreement” for a specified period of time, thirty days. Id. at 668. In this case, the arbitration agreement appears closer to an agreement that may be altered with “unfettered discretion,
Floss, 211 F.3d at 315, than the Morrison and Seawright arbitration agreements, which provided thirty-day and ninety-day grace periods, respectively, before amendments became effective. The FHTM IRs are bound by an amendment as soon as it is published, R.1-2, p.7; thus, FHTM does not promise to maintain the arbitration agreement for a specified amount of time, and no mutuality of obligation to arbitrate exists.
Also, the agreement to arbitrate is illusory despite the fact that the agreement contains a survival provision. The arbitration agreement in the policies and procedures provides that the “agreement to arbitrate shall survive any termination or expiration of the Agreement.” R.1-3, p.10. The defendants argue that this provision restricts FHTM’s right to modify or eliminate the arbitration provision, which means that FHTM does not have an “absolute right” to cancel or terminate the agreement. See Hale v. Cundari Gas Transmision Co., 454 S.W.2d
680, 684 (Ky. Ct. App. 1974)(stating that only an absolute right to terminate an agreement renders the agreement illusory). The survival provision, however, does not eliminate FHTM’s discretion to terminate or amend the arbitration agreement while the underlying contracts remain in effect; FHTM could even remove or alter the survival provision of the arbitration agreement under the authority of the amendment provision in the policies and procedures.
FHTM’s promise to arbitrate is illusory and thus cannot act as consideration for an agreement to arbitrate with the plaintiffs. Because this finding renders moot the plaintiffs’ remaining arguments regarding whether an agreement to arbitrate
was formed, the court rescinds its prior ruling on the issues of whether FHTM sponsors had implied authority to bind the plaintiffs to an arbitration agreement and whether the plaintiffs ratified their contracts with FHTM. Those issues will be resolved at the appropriate time, as either questions of law or questions of fact, after the parties have had sufficient opportunity for full discovery and have thoroughly briefed the issues. Accordingly,
IT IS ORDERED that the plaintiffs’ motion to alter or amend the court’s order
compelling arbitration and dismissing this action, R.67, is GRANTED
IT IS FURTHER ORDERED that the court’s order granting the defendant’
motion to compel arbitration and dismiss or stay the action, R.66, is RESCINDED.
IT IS FURTHER ORDERED that the parties shall file a Rule 26(f) joint written report with proposed deadlines no later than 30 days from the date of entry of this order.
This week I gathered the majority of the news from John Flemming’s team over at Direct Selling News. DSN is the #1 resource for news worldwide surrounding the Direct Selling, Network Marketing and MLM community.
AL International Inc. (JCOF—PK), a global direct marketer of lifestyle and nutritional products as well as gourmet coffee, released financial results for the year and fourth quarter ended Dec. 31, 2011. The company reported net sales of $40.2 million for the year. Gross profit for 2011 was $30.0 million. Year-end net income came in at $1.7 million, while EBITDA was $2.4 million.
The company also reported a tenfold increase in revenues for the quarter, recording net sales of $11.4 million compared to $1.1 million for the same quarter in 2010.
Gross profits grew to $9.2 million in Q4 2011, compared to $166,000 for the same period in 2010, a 485 percent increase. Fourth quarter 2011 net income came in at $1.8 million versus a loss of $471,000 in 2010. Fourth quarter EBITDA came in at $2.0 million, besting EBITDA for the previous quarter (third quarter 2011, which posted EBITDA of $333,000) by 600 percent.
Primerica Inc. (PRI—NYSE) announced financial results for the year ended Dec. 31, 2011.
For the full year 2011, total revenue was $1.1 billion, compared to $1.4 billion for 2010. Net income was $178.3 million for 2011, compared with $257.8 million for 2010. Net income for the first quarter of 2010 did not reflect the impact of the Citi reinsurance and reorganization transactions. Adjusted to reflect the impact of these transactions as well as other operating adjustments described below, net operating income was up 10 percent to $177.1 million for 2011, compared with $161.5 million for 2010 reflecting growth in the Term Life business and strong Investment and Savings Products results partially offset by a higher expense base.
Primerica continues to be well capitalized, holding a high-quality invested asset portfolio with minimal exposure to equities and European sovereign risk. Investments and cash totaled $2.16 billion as of Dec. 31, 2011.
The Board of Directors also approved payment of a quarterly dividend of 3 percent for the fourth quarter of 2011. The dividend will be payable on March 9, 2012, to stockholders of record as of Feb. 24, 2012.
Primerica Inc., headquartered in Duluth, Ga., is a leading distributor of financial products to middle-income families in North America.
Herbalife Ltd. (HLF—NYSE) reported that for the 12 months ended Dec. 31, 2011, the company recorded net sales of $3.5 billion, a 26 percent increase on 21 percent volume growth compared to 2010. For the same period, the company reported adjusted net income of $413.3 million, or $3.31 per diluted share, reflecting an increase of 35 percent and 37 percent respectively compared to the adjusted 2010 results of $305.6 million and $2.42 per diluted share. On a reported basis, EPS of $3.30 increased 39 percent compared to 2010.
For the year ended Dec. 31, 2011, the company generated cash flow from operations of $509.3 million, an increase of 31 percent compared to 2010, paid dividends of $85.5 million, invested $90.9 million in capital expenditures and repurchased $298.8 million in common shares outstanding related to its share repurchase program.
The company reported that its board of directors has approved a dividend of 30 cents per share to shareholders of record effective March 7, 2012, payable on March 22, 2012.
Herbalife Ltd. is a global network marketing company that sells weight-management, nutrition and personal care products intended to support a healthy lifestyle. Herbalife products are sold in 81 countries through a network of approximately 2.7 million independent distributors.
Immunotec Inc. (IMM.V—TSX VENTURE) announced financial results for its year ended Oct. 31, 2011.
During fiscal 2011, Immunotec recorded sales from Mexico of CAN$8.9 million compared to CAN$1.6 million in 2010 representing an increase of CAN$7.3 million in 12 months.
Network sales reached CAN$37.4 million in 2011 compared to CAN$34.5 million for the same period in 2010, an increase of 8.5 percent or CAN$2.9 million. Other revenues, which include revenues of products sold to licensees, freight and shipping, charge backs and educational material purchased by its network, reached CAN$5.5 million in 2011, compared to CAN$5.9 million for the same period in 2010.
Margins before expenses, as a percentage of net sales, decreased in 2011 to 29 percent compared to 31 percent for year 2010 and was primarily attributed to increases in sales incentives paid, which average a payout rate of 51.0 percent, compared to the 47.7 percent level in 2010. The increase in sales incentives is predominantly caused by strong recruitment in the Mexican territory.
For the year ended Oct. 31, 2011, adjusted EBITDA was almost the same as the year before reaching CAN$724,000 compared to CAN$774,000 for fiscal 2010.
Net loss and comprehensive loss totaled CAN$1.1 million for the year ending Oct. 31, 2011, compared to a loss of CAN$1.4 million for 2010. The total basic and fully diluted loss per share for fiscal 2011 was CAN$0.016 compared with a fully diluted loss of CAN$0.020 for the same period in fiscal 2010.
Immunotec also announced that the company will seek shareholder approval of a special resolution authorizing an amendment to the company’s articles of amalgamation on such basis as the directors of the company may determine, so as to consolidate its common shares on the basis of one post-consolidation common share for a maximum 15 pre-consolidation common shares. In addition to approval from Immunotec’s shareholders by special resolution at the meeting, the share consolidation would also be subject to the approval of the TSX Venture Exchange.
The principal reasons for considering the share consolidation include the company’s belief that, if approved and effected, the company could benefit from a raise of its share price to more attractive levels, the improvement of trading liquidity and better chances of raising further capital in the future. The change in the number of issued and outstanding common shares that would result from the share consolidation would cause no change in the capital attributable to the common shares and would not materially affect any shareholder’s percentage of ownership in the company, even though such ownership would be represented by a smaller number of common shares.
Immunotec is a business opportunity supported by unique scientifically proven products that improve wellness. Headquartered with manufacturing facilities near Montreal, Canada, the company also has distribution capacities to support its commercial activities in Canada and internationally to the United States, Europe, Mexico and The Caribbean.
Nature’s Sunshine Products Inc. (NATR—NASDAQ), including its subsidiary Synergy Worldwide, Inc., a natural health and wellness company, reported consolidated financial results for the full year ended Dec. 31, 2011.
Net sales were $367.8 million, compared with $349.9 million in 2010, an increase of 5.1 percent.
Operating income from continuing operations was $20.2 million, compared with $11.3 million in 2010, an increase of 79.0 percent. Excluding contract termination costs of $14.7 million related to its third quarter arbitration settlement with NutriPlus LLC, operating income from continuing operations was $34.9 million in 2011, compared with $11.3 million in 2010, an increase of 210.0 percent.
Adjusted EBITDA, defined here as net income before taxes, depreciation and amortization, other income adjusted to exclude share-based compensation expense and contract termination costs, was $42.8 million, compared with $16.0 million in 2010, an increase of 168.0 percent.
Net income from continuing operations was $17.6 million, compared with $8.5 million in 2010, an increase of 107.8 percent. Excluding the contract termination costs described above, net income from continuing operations was $27.6 million, compared with $8.5 million in 2010, an increase of 225.9 percent.
Basic and diluted net income per share from continuing operations was $1.13 and $1.12, respectively, compared with earnings per share of 55 cents and 54 cents, respectively, in 2010.
Nature’s Sunshine Products, a natural health and wellness company, markets and distributes nutritional and personal care products through a global direct salesforce of over 600,000 independent distributors in more than 40 countries.
USANA Health Sciences Inc. (USNA—NYSE) announced financial results for its fiscal full year ended Dec. 31, 2011.
For the year ended Dec. 31, 2011, net sales increased by 12.4 percent to $581.9 million, compared with $517.6 million in the prior year. This growth was driven by higher product sales and an increase in the average number of active associates in the Asia Pacific region. Favorable changes in currency exchange rates accounted for $15.0 million of the overall increase.
Net earnings for the year ended Dec. 31, 2011 increased by 11.2 percent to $50.8 million, or $3.26 per share, compared with $2.86 per share in the prior year. This growth in net earnings was driven by higher sales and improved gross profit margins, partially offset by higher Associate incentive expenses, higher selling, general and administrative expenses, due primarily to the inclusion of a full year of its China operations and a higher effective tax rate.
The company continued its successful track record of generating cash from operations during 2011. Cash generated from operations totaled $70.1 million for the year ended Dec. 31, 2011. The company repurchased 1.1 million shares in 2011 for a total investment of $33.5 million. The company ended the year debt free, with approximately $50.0 million in cash and cash equivalents, and a remaining repurchase authorization of approximately $28 million.
USANA develops and manufactures high-quality nutritional, personal care and weight-management products that are sold directly to Associates and Preferred Customers in 18 markets worldwide, including China, where its wholly owned subsidiary, BabyCare Ltd., operates a direct selling business.
LifeVantage Corp. (LFVN—OTCBB), maker of Protandim®, the Nrf2 Synergizer™ patented dietary supplement, reported financial results for the six months ended Dec. 31, 2011.
For this fiscal 2012 first six months, the company reported record net revenue of $45.4 million, compared to $13.9 million for the same period in fiscal 2011, a 226 percent increase. Operating income increased to $7.7 million, compared to $1.0 million in the same period last year.
The company improved its balance sheet in the second fiscal quarter. The company’s cash balance at Dec. 31, 2011 was $13.5 million, an increase from $6.4 million at year end fiscal 2011, due to strong revenue growth and operating profits.
On Dec. 29, 2011, the company received approval from warrant holders for and completed a tender offer to modify certain outstanding warrants such that the company will no longer account for these warrants as a derivative liability, which the company believes will enable its financials to more closely reflect operating performance.
LifeVantage is a science-based nutraceutical company. The company was founded in 2003 with corporate headquarters in Salt Lake City and operations in San Diego.
Just Energy Group Inc. (JE—NYSE; JE—TSX) senior executives were in New York recently to open trading on the New York Stock Exchange (NYSE) and mark an important milestone in the company’s history as it officially listed and commenced trading on the NYSE on Jan.30, 2012.
Just Energy, which commenced business in 1997, is a retailer of natural gas, electricity and green energy to end customers in North America. The company has experienced a substantial growth rate across the United States where now more than 50 percent of the company’s sales take place. Over the past five years, the compound growth in customers, sales and margin has been over 70 percent.
Just Energy Group Inc. also filed notice with the Toronto Stock Exchange and the New York Stock Exchange announcing its January dividend. A dividend of CAN$0.10333/common share (CAN$1.24 annually) will be paid on Feb. 29, 2012 to shareholders of record at the close of business on Feb. 15, 2012. This dividend is designated as an “eligible dividend” for Canadian income tax purposes.
Just Energy also reports that at Jan. 31, 2012 the conversion price for each CAN$1,000 of its outstanding 6 percent convertible unsecured subordinated debenture issued on Oct. 2, 2007 (JE.DB.A—TSX) has been adjusted in accordance with the Trust Indenture dated Oct. 2, 2007, as supplemented from time to time, to CAN$29.81 convertible into 33.55 common shares of Just Energy Group Inc.
Avon Products Inc. (AVP—NYSE) declared a regular quarterly dividend of 23 cents per common share. The first quarter dividend was payable March 1, 2012, to shareholders of record on Feb. 24, 2012.
On an annualized basis, the indicated dividend rate would be 92 cents per share, flat with the 2011 rate.
Avon, the company for women, is a leading global beauty company, with over $11 billion in annual revenue. As the world’s largest direct seller, Avon markets to women in more than 100 countries through approximately 6.4 million active independent Avon Sales Representatives.
Nu Skin Enterprises Inc. (NUS—NYSE) announced that its board of directors has declared a 25 percent increase in the quarterly cash dividend to 20 cents per share, compared to the previous dividend of 16 cents per share. This dividend will be paid on March 14, 2012 to shareholders of record on Feb. 24, 2012.
Nu Skin Enterprises Inc., a global direct selling company with a comprehensive anti-aging product portfolio, operates in 52 markets worldwide and has more than 850,000 independent distributors.
Direct Selling News has accumulated this information from public sources, including press releases and SEC filings. The information is presumed accurate and reliable. However, it is not an endorsement of any investment opportunity. Proper and considerable due diligence should be completed before making any investment.