SOURCE: Natural Health Trends Corp.

January 22, 2008 19:30 ET

Natural Health Trends Corp. President Chris Sharng Releases an Open Letter to Stakeholders

DALLAS, TX--(Marketwire - January 22, 2008) - Natural Health Trends Corp. (NASDAQ: BHIP), an international direct selling company, today released this open letter from its President to its stakeholders.

We at Natural Health Trends Corp. have been working on a plan to turn our Company around and are optimistic about our progress, which we wanted to share with you.

The Chinese New Year is rapidly approaching. Our most important, promising yet challenging market is the Hong Kong-based business. The regulatory uncertainty in China is outside of our control and will not go away quickly, but we have a meaningful operating history in the region, believe that there is great upside in our business, and anticipate this market will continue progressing toward a more normalized operating environment.

We have discussed before that we, as well as our most important Greater Chinese leaders, were advised not to engage in marketing activities in the third quarter of 2007. This lack of activity directly contributed to the decrease in the third quarter revenue. What is encouraging to us, however, is that while the revenue decrease mainly took place from July to August, revenues have generally been stable since August, with a modestly positive momentum ending the fourth quarter. This more stabilized level of revenue has enabled us to more specifically plan and implement spending cuts. In addition to reductions in the first quarter, mostly in Japan and Mexico, significant additional reductions were made in the third and fourth quarters in the U.S., China, Hong Kong and Taiwan.

Amid these cost reductions, we streamlined our organization in the Greater Chinese market by eliminating redundant management while elevating experienced professionals, which was well supported by our Greater Chinese members. With these changes, we laid the foundation to make a solid turnaround of our Greater China business possible in 2008. We are now re-establishing our marketing presence, with an emphasis on training, conducted by both the Company as well as by members. We think this has helped bring back the enthusiasm in the Greater China marketplace.

In evaluating our international presence, our criterion is simply that, regardless of legacy, every market must be cash flow positive. Greater China, Korea and Taiwan fit that profile today. We also think that the European market is promising. We have invested in the necessary infrastructure and plan to grow that business, which started in Southern Europe and may expand to Central Europe later this year. We are still evaluating other markets to see if our cost cutting measures in those markets will have the desired effect.

Where do we go from here? Our long-term objective continues to be building a premiere, world-reaching direct selling organization, with emphasis on exciting markets, offering premium wellness, anti-aging, energy, and quality of life products and a successful alternative to more conventional career paths for our distributors. We continue to believe that direct selling is one of the most efficient business mechanisms to deliver our products to consumers worldwide, while creating success and goodwill for all involved.

Our extensive footprint in some of the fastest growing parts of the world continues to make us optimistic about our long-term prospects. Our system and products appeal to not only under-employed but also to enterprising entrepreneurs and wellness-conscious consumers as well around the world. The Company will strive to develop and regularly launch products that are consistent with our message and that encourage a daily regimen. Our goal over time is to increase the recurring revenue generated from genuine consumer demand for personal consumption of our products and add to our family of people making a home-based business with our system.

We thank the many people who continue to support us, and look forward to the year of 2008 with a great deal of anticipation. We also expect to communicate more on a regular basis with our updates.

Thanks and best regards,

Chris Sharng
President
Natural Health Trends Corp.

About Natural Health Trends Corp.

Natural Health Trends Corp. is an international direct-selling and e-commerce company operating through its subsidiaries in Asia, North America, Europe and Latin America. The Company markets premium quality personal care products under the NHT Global brand. Additional information can be found on the Company's website, and management encourages interested parties to register for updated corporate information via email on the Company's home page, www.naturalhealthtrendscorp.com.

Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995 -- Forward-looking statements in this release do not constitute guarantees of future performance. Such forward-looking statements are subject to risks and uncertainties that could cause our actual results to differ materially from those anticipated. Such risks and uncertainties include the risks and uncertainties detailed under the caption "Risk Factors" in our Registration Statement on Form S-3 filed with the Securities and Exchange Commission on December 28, 2007. We assume no obligation to update any forward-looking information contained in this press release or with respect to the announcements described herein.

Contact Information

  • Contact:

    Chris Sharng
    President
    Natural Health Trends Corp.
    (972) 241-4080