Lifevantage Corporation

Good day, ladies and gentlemen. Thank you for standing by. Welcome to today's conference call to discuss LifeVantage's first quarter of fiscal 2025 results. At this time, all participants are in a listen-only mode. Following the formal remarks, we will conduct a question and answer session. Instructions will be provided at that time for you to queue up. Hosting today's conference will be Reed Anderson with ICR. As a reminder, today's conference is being recorded. Now I'd like to turn the call over to Mr. Anderson. Please go ahead, sir.

Thank you. Good afternoon and welcome to LifeVantage Corporation's conference call to discuss results for the first quarter of fiscal 2025. On the call today from LifeVantage, with prepared remarks, are Steve Fyfe, President and Chief Executive Officer, and Carl Alray, Chief Financial Officer. By now, everyone should have access to the earnings release, which went out this afternoon at approximately 4.05 p.m. Eastern Time. If you have not received the release, it is available on the investor relations portion of LifeVantage's website at www.lifevantage.com. This call is being webcast and a replay will be available on the company's website as well. Before we begin, we would like to remind everyone that our prepared remarks contain forward-looking statements and management may make additional forward-looking statements in response to your questions. These statements do not guarantee future performance and therefore undue reliance should not be placed upon them. These statements are based on current expectations of the company's management and involve inherent risks and uncertainties, including those identified in the risk factors section of LifeVantage's most recently filed forms 10-K and 10-Q. Please note that during today's call, we will be discussing non-GAAP financial measures, including results on an adjusted basis. Management believes these financial measures can facilitate a more complete analysis and greater transparency into LifeVantage's ongoing results of operations, particularly in comparing underlying operating results from period to period. We've included a reconciliation of these non-GAAP measures with today's release. This call also contains time-sensitive information that is accurate only as of the date of this live broadcast, October 29th, 2024. LifeVantage assumes no obligation to update any overlooking projections that may be made in today's release or call. Now I will turn the call over to Steve Feith, the President and Chief Executive Officer of LifeVantage.

Thanks, Reid, and good afternoon, everyone. Thank you for joining us today. It's an incredible time at LifeVantage as we just launched the MindBody GLP-1 system, an amazing innovation targeting consumers searching for an effective, sustainable weight management solution. This product significantly spans our total addressable market, and the initial response from our consultants and customers has been overwhelming. But before I go deeper into talking about MindBody, let me first give you a quick recap of our latest results, which are generally in line with our expectations. In the first quarter, we again delivered solid profitability metrics despite lower revenues, which continue to be impacted by macro headwinds, particularly in our international markets. Our adjusted EBITDA increased 11% versus last year, and our adjusted EBITDA margin was 9.4%, a 160 basis point improvement compared to last year's first quarter. Total revenue was down 8% as lower consultant and customer numbers were partially offset by an increase in revenue per consultant. While the overall consumer environment remains challenging, we are highly encouraged by the strong response from consultants and customers to our new product. September was a very strong month for us as consultants built excitement in advance of the product launch. And October will be the highest bookings month in the company's history. And overall enrollments in October are approximately four times our recent monthly averages. We believe this momentum will continue to build as fiscal 2025 unfolds. There's good reason to be excited about the MindBody GLP-1 system. GLP-1 is short for glucagon-like peptide 1, a hormone that works along the gut-brain axis to control digestion and balance blood sugar. GLP-1 also supports the health of several organs, including the heart, liver, and kidneys. Like many things in our body, production of the GLP-1 hormone declines due to age, poor diet, stress, and other lifestyle factors. This decline can cause cravings, false hunger, and weight gain, among other health concerns. Just as our flagship product, Protandim Nrf2, activates antioxidant production in the body, our new MindBody GLP-1 system activates the production of GLP-1 using naturally sourced ingredients. You take the MindBody GLP-1 system to help your body make this essential, impactful hormone. With this addition to our portfolio, we are once again demonstrating our ability to own health activation at the cellular level. When this innovative dual product solution helps your body restore GLP-1 production, The results are truly something you can see and feel. We completed a successful 12-week human clinical trial to evaluate the efficacy of MindBody. Results from this trial included an outstanding 140% average increase in GLP-1 levels in the body. Participants had an average weight loss of nine pounds in eight weeks and up to 25 pounds in 12 weeks. Adding to the results, 100% of participants who lost weight did not lose muscle, but did lose up to 27% in visceral fat and 5% total body fat. Participants also reported exciting qualitative data as well. 95% had decreased sugar cravings. 96% chose smaller portions. 85% now eat for health instead of emotion. 85% agreed their food cravings decreased. And 82% felt more in control of their relationship with food. The clinical trial built upon successful in vitro results, which found the mind-body GLP-1 system significantly increased GLP-1 production in L cells by activating key genes. The in vitro study also revealed a 38% reduction in DPP4 gene expression, allowing more GLP-1 to remain active within the body, and a 53% increase in GLP-1R expression, which promotes the creation of GLP-1 cell receptors, further enhancing the body's ability to use GLP-1. Thanks to the results of this research, the MindBody GLP-1 system is patent pending, ensuring that innovation remains something only life and age and our consultants can deliver. The MindBody GLP-1 system is a two-part system made up of MB Core and MB Enhance that is uniquely paired to deliver results leading to total transformation. MB-Core is a blend of acacia, lemon bioflavonoids, berberine, asperidin, eggplant, and chromium that directly activate GLP-1 in specialized L-cells, promoting fullness through the gut-brain axis. It reduces cravings, slows gastric emptying, and balances key hunger hormones. It is two capsules taken daily. 30 minutes before consuming any calories. MB Enhance combines resistant starches and fibers, including potato and tapioca, which ferment in the large intestine. These fibers act as prebiotics, supporting gut health, providing indirect activation through the priming of L cells. MB Enhance provides 48% of daily dietary fiber with a light vanilla flavor that complements smoothies and other beverages consumed throughout the day. Our comprehensive approach provides effective, sustainable weight loss and overall wellness. Unlike traditional weight management methods, MindBody emphasizes long-term lifestyle changes and a healthier relationship with food. The system helps stop the toxic cycle of trendy fads and yo-yo dieting with results coming from helping your body work as designed. A press release issued earlier today provides a recap of all these exciting results. The new MindBody GLP-1 system was unveiled at our recent Market Connect event held October 11th and 12th in Kansas City. The initial onsite inventory sold out within a couple of hours, so additional inventory was shipped to the event to meet the overwhelming demand. The demand was also reflected in our e-commerce sales exceeding forecast. Our initial inventory order of MindBody System is now sold out. We are officially on backorder, meaning orders continue to be placed by both consultants and customers with product shipping when we are back in stock in approximately seven weeks. The level of demand for this product is many multiples of what we saw when our liquid collagen product was first introduced a couple years ago, giving us a high degree of optimism about future growth potential. In addition to MindBody, Market Connect offered exclusive business training for consultants, emphasizing the new commission bonuses and the latest enhancements to the evolved compensation plan, which will take effect on November 1st. We also announced several improvements to the consultant experience, including a new feature that allows the creation of a suggested shopping cart for new consultants joining LifeVantage. The event generated significant excitement and was an outstanding success, further energizing our consultant community. Regarding the latest updates to the evolved compensation plan, we are rolling out enhancements to offer greater simplicity and increased earning potential for our independent LifeVantage consultants. These enhancements will go live on November 1st, 2024 across the US, Japan, Australia, New Zealand, Canada, Mexico, and European markets. At the heart of this optimization is the new sharing bonus. This sharing bonus is a simple 10% commission on top of other elements of the compensation plan earned when your new consultant and their customers purchase products. We have also reimagined accelerators to help new consultants achieve early income success. During the first four months of their business, consultants are eligible to receive double the sharing bonus, up to 20%, instead of the standard 10%. Additionally, new consultants earn a bonus upon reaching the key milestone rank of Senior Consultant One. Finally, we continue to focus on enhancing the appeal of our model for entrepreneurs, including making it easier for them to grow and operate their businesses. We have recently partnered with Clearwater to offer LifeSantage Healthcare, a health insurance option for consultants. Clearwater offers a variety of major medical, health share, and supplemental plans, including holistic and wellness options. The response to this offer has been tremendous, with many consultants expressing that this partnership removes a large barrier for those looking to go all in on their life-santage business. In summary, we are incredibly excited about the launch of our new MindBody GLP-1 system, and believe it will be a game changer for our consultants and their businesses. It significantly expands LifeVantage's activation story into the rapidly growing category of weight loss. We also remain focused on continuing to drive strong financial performance and significant long-term value for our shareholders. Now, let me turn the call over to Carl Auri, our Chief Financial Officer, to review our first quarter financial results.