USNA USANA Health Sciences

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549
______________

FORM 8-K
______________

CURRENT REPORT

Pursuant to Section 13 or 15(d) of

the Securities Exchange Act of 1934

Date of Report (Date of Earliest Event Reported):
August 4, 2015

USANA HEALTH SCIENCES, INC.
(Exact name of registrant as specified in its charter)

Utah
(State or other jurisdiction of incorporation)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

⃞ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

⃞ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

⃞ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

⃞ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 2.02     Results of Operations and Financial Condition.              

On August 4, 2015, USANA Health Sciences, Inc. issued a press release announcing its financial results for the second quarter and six months ended July 4, 2015.  The release also announced that the Company will post a document titled “Management Commentary, Results and Outlook” on the Company’s website and that executives of the company would hold a conference call with investors, to be broadcast over the World Wide Web and by telephone and provided access information, date and time for the conference call.  The Company noted that the call will consist of brief remarks by the Company’s management team, before moving directly into questions and answers. A copy of the press release, and the Management Commentary, Results and Outlook, are furnished herewith as Exhibits to this Current Report on Form 8-K and are incorporated herein by reference.  These documents will be posted on the Company’s corporate website, www.usanahealthsciences.com.  

The information in this Current Report is being furnished and shall not be deemed “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liabilities of that Section. The information in this Current Report shall not be incorporated by reference into any registration statement or other document pursuant to the Securities Act of 1933, as amended. The furnishing of the information in this Current Report is not intended to, and does not, constitute a representation that such furnishing is required by Regulation FD or that the information this Current Report contains is material investor information that is not otherwise publicly available.

Item 5.02     Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.              

(c)

On August 4, 2015, the Company announced that the Board of Directors has approved a Co-Chief Executive Officer leadership structure for the Company and that David A. Wentz and Kevin G. Guest will serve as Co-Chief Executive Officers of the Company and report directly to the Board of Directors.  Mr. Wentz will oversee USANA’s global operations while Mr. Guest will lead USANA’s worldwide field development and sales efforts.

Mr. Wentz has served as Chief Executive Officer of the Company since July 2008.  For the last 12 months, Mr. Wentz had reduced his time in the office to spend more time with his family and to work on several strategic initiatives. He returned to the Company on a full-time basis on August 3, 2015.  As Co-Chief Executive Officer, Mr. Wentz will receive an annual salary of $618,000, continue to be eligible to participate in the Company’s Executive Bonus Plan, and be eligible to receive equity grants under the Company’s 2015 Equity Incentive Award Plan.  Mr. Wentz will also be eligible to participate in the Company’s 401K plan and to receive medical and other benefits coverage, which is generally available to the Company’s other employees.

Mr. Guest has served as President of USANA world-wide since August 2014.  Prior to serving as President, Mr. Guest served as President of the Americas, Europe and South Pacific from May 2011 to October 2012, and Chief Marketing Officer from July 2008 to May 2011.  As Co-Chief Executive Officer, Mr. Guest will receive an annual salary of $618,000, continue to be eligible to participate in the Company’s Executive Bonus Plan, and be eligible to receive equity grants under the Company’s 2015 Equity Incentive Award Plan.  He will also be eligible to participate in the Company’s 401K plan and to receive medical and other benefits coverage, which is generally available to the Company’s other employees.

The Company also announced that on August 4, 2015, Chief Financial Officer, Paul A. Jones, was appointed Chief Leadership Development Officer of the Company where he will oversee the key role of the Company’s executive development and succession program.  Mr. Jones will assume this new role immediately and continue his CFO responsibilities while the Company facilitates its search for a new Chief Financial Officer.

The press release issued by the Company on August 4, 2015 announcing these events is attached hereto as Exhibit 99.3 and incorporated herein by reference.  

Item 9.01     Financial Statements and Exhibits.

(d)  Exhibits

Exhibit 99.1        Press release issued by USANA Health Sciences, Inc. dated August 4, 2015 (furnished herewith).
Exhibit 99.2        Management Commentary, Results and Outlook provided by USANA Health Sciences, Inc. dated August 4, 2015 (furnished herewith).
Exhibit 99.3        Press release issued by USANA Health Sciences, Inc. dated August 4, 2015 (furnished herewith).

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

Exhibit 99.1

USANA Health Sciences Reports Record Net Sales of $233.2 Million; 41% Increase in EPS for Second Quarter 2015

• Second quarter net sales increased 23.9% to $233.2 million
• Second quarter EPS increased 41.2% to $1.92
• Number of active Associates increased 40.3% to 397,000
• Company increases outlook for 2015

SALT LAKE CITY--(BUSINESS WIRE)--August 4, 2015--USANA Health Sciences, Inc. (NYSE: USNA) today announced record financial results for its fiscal second quarter ended July 4, 2015. The Company also increased its financial outlook for 2015.

Financial Performance

For the second quarter of 2015, net sales increased to $233.2 million, up 23.9% compared with $188.3 million in the prior-year period. The increase in net sales was driven by 40.3% growth in the number of active Associates and 15.2% growth in the number of Preferred Customers. Also included in net sales for the quarter is $5 million in revenue that was deferred during the previous quarter in connection with price increases in China. Fluctuations in currency exchange rates negatively impacted net sales by $9.7 million due to the strengthening of the U.S. dollar.

Net earnings for the second quarter increased by 31.7% to $25.4 million, compared with $19.3 million during the prior-year period. The increase in net earnings was driven by higher net sales, improved gross margins and lower relative selling, general and administrative expense, which were partially offset by higher relative Associate Incentives expense.

Earnings per diluted share for the second quarter increased 41.2% to $1.92, compared with $1.36 in the prior year period. The increase in earnings per share was attributable to higher net earnings and a lower number of diluted shares outstanding due to the Company’s share repurchases during 2014. Weighted average diluted shares outstanding were 13.2 million as of the end of the second quarter of 2015, compared with 14.2 million in the prior-year period. During the second quarter of 2015, the Company did not repurchase any shares of common stock.

The Company ended the second quarter with $150.9 million in cash and cash equivalents, zero debt and $61.2 million remaining under the current share repurchase authorization.

“USANA generated exceptional results during the second quarter, which again included double-digit growth in sales, earnings and customers,” said Kevin Guest, USANA’s President. “Our better-than-expected results reflect the strong momentum we are seeing in our business, which is largely being driven by our strategies for customer growth.”

Regional Results

Net sales in the Asia Pacific region increased by 35.4% to $168.7 million, compared with $124.6 million for the second quarter of the prior year. Sales grew 51.6% in the Greater China region, 7.8% in the Southeast Asia Pacific region and 32.4% in the North Asia region. Sales growth in Greater China was driven by strong customer growth in Mainland China, while growth in Southeast Asia Pacific resulted from customer growth within each market in the region. Finally, sales growth in North Asia was driven by double-digit customer growth in South Korea.

The number of active Associates in the Asia Pacific region increased by 53.2% year-over-year, and increased 6.2% sequentially. Net sales in the Asia Pacific region were negatively impacted by $5.1 million due to the strengthening of the U.S. dollar.

Net sales in the Americas/Europe region increased modestly to $64.5 million and were negatively impacted by $4.6 million due to the strengthening of the U.S. dollar. Canada, Mexico and Colombia all generated double-digit customer growth in the second quarter, compared with the prior year period.

“Although currency remains a headwind, our business continues to generate solid worldwide growth,” continued Guest. “While Mainland China continues to lead the way, it is noteworthy that USANA generated both sales and customer growth in nearly every market around the world, which reflects the demand for our best-in-class products and business opportunity. During the quarter, we held our annual Asia Pacific convention in Singapore, where thousands of our Associates celebrated their success and received additional training. Later this month, we will hold our annual International Convention in Salt Lake City, where we also expect record attendance and another amazing event.”

Outlook

The Company provided the following updated consolidated net sales and earnings per share outlook for 2015:

• Consolidated net sales between $900 million and $920 million, versus the previous outlook of between $870 million and $890 million
• Earnings per share between $6.90 and $7.20, versus the previous outlook of between $6.45 and $6.75

Chief Financial Officer Paul Jones said, “During the quarter, our team capitalized on the leverage opportunity created by higher sales. As we anticipated, our Associate Incentives expense returned to our customary range following the completion of our promotional activities during the prior two quarters. The relative improvement in both gross margins and SG&A for the quarter also enhanced this leverage. In light of our better than expected results during the first half of 2015, and the momentum we continue to see in our business, we are increasing our outlook for 2015 and look forward to delivering another year of record results for USANA and its stakeholders.”

Conference Call

The Company has posted the “Management Commentary, Results and Outlook” document on the Company’s website (www.usanahealthsciences.com) under the “Investor Relations” section of the site. USANA will hold a conference call and webcast to discuss today’s announcement with investors on Wednesday, August 5, 2015 at 11:00 a.m. Eastern Time. Investors may listen to the call by accessing USANA’s website at http://www.usanahealthsciences.com. The call will consist of brief opening remarks by the Company’s management team, before moving directly into questions and answers.

About USANA

USANA develops and manufactures high-quality nutritional supplements, healthy foods and personal care products that are sold directly to Associates and Preferred Customers throughout the United States, Canada, Australia, New Zealand, Hong Kong, China, Japan, Taiwan, South Korea, Singapore, Mexico, Malaysia, the Philippines, the Netherlands, the United Kingdom, Thailand, France, Belgium and Colombia. More information on USANA can be found at http://www.usanahealthsciences.com.

Safe Harbor

This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act and Section 21E of the Securities Exchange Act. Our actual results could differ materially from those projected in these forward-looking statements, which involve a number of risks and uncertainties, including global economic conditions generally, reliance upon our network of independent Associates, the governmental regulation of our products, manufacturing and marketing risks, adverse publicity risks, and risks associated with our international expansion. The contents of this release should be considered in conjunction with the risk factors, warnings and cautionary statements that are contained in our most recent filings with the Securities and Exchange Commission.

CONTACT:
USANA Health Sciences, Inc.
Investors contact:
Patrique Richards, 801-954-7961
Investor Relations
investor.relations@us.usana.com
or
Media contact:
Dan Macuga, 801-954-7280
Public Relations

Exhibit 99.2

USANA Health Sciences, Inc.

Q2 2015 Management Commentary,
Results and Outlook

August 4, 2015

Overview

The second quarter was another record quarter for USANA.  Net sales increased by 23.9% to $233.2 million on a year-over-year basis.  Sales growth was driven by overall Associate growth of 40.3% and Preferred Customer growth of 15.2%.  Associate growth was primarily generated by our Asia Pacific region where the number of active Associates increased 53.2% year-over-year.  Preferred Customers increased in each region around the world.  While our Greater China region continued to lead the way this quarter, every region generated sales and customer growth.

Also included in net sales for the quarter is $5 million in revenue that was deferred during the previous quarter in connection with buying ahead of price increases in China.  Unfavorable changes in foreign currency exchange rates had the affect of reducing net sales by $9.7 million on a comparative basis.  On a constant currency basis, our net sales would have increased by 29.0% during the current year quarter.

Our better than anticipated sales and customer growth this quarter was the result of strong momentum in our world-wide business, led by Greater China, which reflects the demand for USANA’s best-in-class products and business opportunity.  Our current growth strategies, which are centered on motivating our sales force with market-specific incentives, increasing our branding recognition and advancing our personalization initiative, are helping to drive this momentum.  In particular, the market-specific incentives that we have offered over the past few quarters have created excitement and momentum in our business.  These incentives have been a key factor in accelerating our customer growth in nearly all of our markets.  Additionally, our strategy to increase our brand recognition, which includes our relationship as a Trusted Partner and Sponsor of The Dr. Oz Show, is making it easier for our Associates to introduce USANA to new customers in each of our regions.  Finally, investments in our personalization initiative and IT infrastructure are designed to create the foundation for future growth by making it easier, more exciting, and more enjoyable to partner with USANA.

During the quarter, we also held our annual Asia Pacific convention in Singapore, where thousands of our Associates gathered to celebrate their success, meet with management and receive additional training.  These conventions also help generate momentum in our business, as we typically see our sales force leave these events with renewed excitement and motivation to grow their business.

Net earnings for the second quarter increased by 31.7% to $25.4 million when compared with the prior-year period.  This increase can be attributed to leverage gained on higher net sales during the quarter.  Accordingly, we saw improvements in relative gross margins and selling, general and administrative expense year-over-year. These improvements were partially offset by higher Associate Incentives expense.  Although Associate Incentives expense increased 60 basis points year-over-year to 43.7% of net sales, this line item decreased 250 basis points sequentially, largely as a result of our management of market specific incentives and promotions. We continue to expect this expense to be in the range of 44.0 to 44.5% of net sales for the remainder of 2015.

Earnings per share for the quarter increased by 41.2% to $1.92, due to higher net earnings and a lower number of diluted shares.  Weighted average diluted shares outstanding were 13.2 million at the end of the second quarter of 2015, compared with 14.2 million for the prior-year period. The reduced diluted share count contributed approximately $0.13 to earnings per share for the quarter.  During the quarter, we did not repurchase any shares of common stock.  As of August 4, 2015, there was $61.2 million remaining under the current share repurchase authorization.

Regional and Financial Results

Asia Pacific Region | Q2 2015 Net Sales of $168.7 million; 72.3% of Consolidated Net Sales

Net sales in our Asia Pacific region increased by 35.4% year-over-year.  The number of active Associates in the region increased by 53.2% year-over-year and 6.2% sequentially.  This performance was the result of double-digit growth in active Associates in each of our Greater China, Southeast Asia Pacific, and North Asia regions.  Net sales in the region were negatively impacted by $5.1 million due to a strengthening U.S. dollar.

Greater China.  Net sales in Greater China increased 51.6% year-over-year due to continued growth in Mainland China.  Specifically, local currency sales in Mainland China increased 83.6% year-over year, while the number of active Associates nearly doubled.  Net sales in the region were minimally impacted by currency fluctuations.  

Sales and customer growth in Mainland China continued to benefit from momentum generated by the incentive that we offered during the fourth quarter of 2014 and first quarter of 2015, as well as a smaller promotion offered during the second quarter.  During the quarter, we continued to make progress on the remodel of our branch locations and the construction of our new state-of-the-art production facility in Beijing.  This project is progressing on schedule and we continue to anticipate that this facility will be operational in early 2016.

Southeast Asia Pacific.  The 7.8% net sales increase in the Southeast Asia Pacific region was driven by double-digit Associates growth in each of the markets within this region. Net sales in the region were negatively impacted by $4.5 million due to a strengthening U.S. dollar.

North Asia.  Net sales in North Asia increased 32.4% year-over-year as a result of 44.4% Associate growth in the region.  Net sales in the region were negatively impacted by $814 thousand due to a strengthening U.S. dollar.  We are pleased with the momentum that we are seeing in our Korean market.  

Americas and Europe Region | Q2 2015 Net Sales of $64.5 million; 27.7% of Consolidated Net Sales

In the Americas and Europe region, net sales on a year-over-year basis increased 1.4%, while the number of active Associates increased 8.5%.  Sales were negatively impacted by $4.6 million due to a strengthening U.S. dollar.  We generated double-digit sales growth on a constant currency basis in most markets within the region.  In particular, Canada and Mexico generated local currency sales growth of 22.2% and 20.6% respectively.  The number of active Associates increased 12.0% in Canada and 20.0% in Mexico.

Balance Sheet

We ended the second quarter with $150.9 million in cash and cash equivalents, zero debt, and $132.0 million in net working capital. Although inventory increased 19.4% since year-end 2014, inventory turns were in line with historical levels and indicative of an increased demand for our product.

Quarterly Income Statement Discussion

Gross margins improved 130 basis points year-over-year, due in large part to changes in our market sales mix, leverage gained on higher net sales, and from price increases introduced during the first half of the year.  These improvements were partially offset by the negative impact of a strengthening U.S. dollar.

Associate incentives expense for the quarter increased 60 basis points year-over-year to 43.7% of net sales.  As noted previously, the relative increase in Associate Incentives expense was due largely to higher spending on market specific incentive programs.  Throughout 2015, market-specific incentives and promotions will continue to be offered, but on a smaller scale than the incentive offered earlier in the year.  These incentives will be consistent with our primary goal of generating long-term customer growth as we seek to improve the overall health and nutrition of individuals and families around the world.

Selling, general and administrative expense was 22.5% of net sales, a decrease of 50 basis points compared to the prior year period.  This relative decrease was due primarily to leverage gained on higher sales.  This benefit was partially offset by the change in timing of costs associated with our annual Asia Pacific Convention, which was held in the second quarter of this year compared to the first quarter of last year.  Notably, fluctuations in currency exchange rates negatively impacted relative SG&A by 30 basis points, on a comparative basis.  On an absolute basis, SG&A increased due to expenses related to our business in China, along with investments in infrastructure, brand recognition, and product innovation.

Outlook

During the third quarter, we are looking forward to hosting our annual International Convention in Salt Lake City, Utah.  We are once again expecting record attendance as Associates from around the world come together to celebrate and receive additional training.  This event continues to be an excellent platform for us to make exciting announcements and to ensure that the vision and goals of the Company are consistent with those of our independent sales force.  We expect another amazing event this year, which will be held August 19^th through the 22^nd.

Additionally, we continue to look forward to opening Indonesia later this year, which will be our 20th market.  We have made excellent progress since the announcement of our plans to enter this market and continue to be excited and optimistic about the potential of our business there.

Given our better than expected results in the first half of the year, and the momentum we are seeing in our world-wide business, we expect 2015 to be another record year for USANA.  In our earnings release today, we provided the following updated consolidated net sales and earnings per share outlook for 2015:

• Consolidated net sales between $900 million and $920 million, versus previous outlook of between $870 million and $890 million
• Earnings per share between $6.90 and $7.20, versus previous outlook of between $6.45 and $6.75

For the full-year 2015, we expect that Earnings from Operations will be around 15.5% of net sales at the high-end of our net sales range.  Our outlook anticipates:

• Associate Incentives expense of 44.0% to 44.5% of net sales for the remainder of 2015;
• Planned capital spending of approximately $45 million for our new facility in China, branch upgrades, and investments in our personalization initiative and information technology infrastructure;
• An effective tax rate of approximately 34% for the full-year;
• Continued headwinds from a strengthening U.S. dollar; and
• A diluted share count of approximately 13 million shares.

As we continue to execute our current strategy, we will continue to manage expenses and maximize efficiencies to capitalize on the leverage opportunity presented by higher sales.  Our primary goal remains the growth of our customer base, which furthers the Company’s vision of improving the overall health and nutrition of individuals and families around the world.  We look forward to delivering another record year for USANA and all of its stakeholders.

Kevin Guest

President

Paul Jones

Chief Financial Officer


Forward-Looking Statements

This document contains 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 results projected in such forward-looking statements.  Examples of these statements include those regarding our strategies and outlook for 2015.  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.

7

Exhibit 99.3

USANA Board of Directors Appoints Dave Wentz and Kevin Guest as Co-Chief Executive Officers

SALT LAKE CITY--(BUSINESS WIRE)--August 4, 2015--USANA Health Sciences, Inc. (NYSE: USNA) today announced that the Board of Directors has appointed Dave Wentz and Kevin Guest as Co-Chief Executive Officers of the Company, effective immediately. Mr. Wentz will oversee USANA’s global operations, while Mr. Guest will lead USANA’s worldwide field development and sales efforts. Both Mr. Guest and Mr. Wentz will report directly to the Board of Directors.

Dr. Myron Wentz, USANA’s founder and Chairman of the Board, commented, “Kevin has been with USANA for over 20 years, most recently as President, and has played a key role in leading USANA to new heights in sales and financial performance. Dave has also been with USANA for over 20 years and has served in executive positions for much of that time, most recently as Chief Executive Officer. As USANA approaches the $1 billion revenue milestone, the Board is preparing for the next chapter of growth. With USANA’s expanding global presence, and the demands on the chief executive position, the Board determined that a division of responsibilities within the CEO role would maximize USANA’s potential.”

Dave Wentz commented, “Kevin and I have worked as a team both formally and informally for more than 20 years, and he has demonstrated his leadership skills as President of our company. It is exciting to be able to recognize Kevin for his contributions and have him join me as Co-CEO. I look forward to sharing with him the growing CEO responsibilities as USANA capitalizes on its many growth and expansion opportunities.”

Kevin Guest commented, “I am honored by the recognition from the Board of Directors and Dave. Dave and I have worked side by side to achieve many goals over the years, and I look forward to working with Dave and the rest of our team as we take USANA to the next stage of growth.”

USANA also reported today that Paul Jones, Chief Financial Officer, has been appointed Chief Leadership Development Officer, where he will be responsible for the key role of overseeing USANA’s global executive development and succession planning program. Mr. Jones will continue his CFO responsibilities while the Company initiates a search for a new Chief Financial Officer.

About USANA

USANA develops and manufactures high-quality nutritional supplements, healthy foods and personal care products that are sold directly to Associates and Preferred Customers throughout the United States, Canada, Australia, New Zealand, Hong Kong, China, Japan, Taiwan, South Korea, Singapore, Mexico, Malaysia, the Philippines, the Netherlands, the United Kingdom, Thailand, France, Belgium and Colombia. More information on USANA can be found at http://www.usanahealthsciences.com.

Safe Harbor

This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act and Section 21E of the Securities Exchange Act. Our actual results could differ materially from those projected in these forward-looking statements, which involve a number of risks and uncertainties, including global economic conditions generally, reliance upon our network of independent Associates, the governmental regulation of our products, manufacturing and marketing risks, adverse publicity risks, and risks associated with our international expansion. The contents of this release should be considered in conjunction with the risk factors, warnings, and cautionary statements that are contained in our most recent filings with the Securities and Exchange Commission.

CONTACT:
USANA Health Sciences, Inc.
Investors contact:
Patrique Richards, 801-954-7961
Investor Relations
investor.relations@us.usana.com
or
Media contact:
Dan Macuga, 801-954-7280
Public Relations