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Reliv International profit dropped 40 percent in the third quarter due to the sluggish economy,

The nutrition and direct-selling company posted Wednesday net income of $536,000, or 4 cents a share, in the third quarter, down from net income of $901,000, or 6 cents a share, a year ago.

Reliv reported sales of $24 million in the third quarter, down 4 percent from sales of $25 million a year earlier.

As of Sept. 30, Reliv’s distributor base totaled approximately 68,540, which represents a slight drop from a year ago.

“The third quarter was not as strong as we had hoped for, and we believe the shocks to the U.S. economy in September played a role in our sales decline,” said Robert Montgomery, president, chairman and chief executive, in a statement.

“Short-term, restructuring our European operations significantly reduced our pre-tax losses in that region as we expected. But that improvement was negated by lower U.S. pre-tax profits resulting from a sales decline.”

“We launched an automatic shipping program in the U.S. at our International Conference in August, which we believe will be a long-term positive for our business. We also launched the program in Australia this month,” he added.

“In addition to a planned product launch on Nov. 8, we continue to look for proven incentive programs to stimulate sales, and we have a national conference for U.S. distributors scheduled for February 2009, which should further motivate our field,” Montgomery said.

As of Sept. 30, 2008, Reliv’s distributor base totaled approximately 68,540, which represents a slight drop from a year ago.

“We are focused on turning around our U.S. business by sticking to the basics: Reliv makes nutrition simple. Our products can play a role in supporting many thousands of people’s efforts to live a healthier life. In addition, we offer distributors an outstanding business opportunity,” he added.

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Finally some good news for Herbalife. The company has been plagued lately with lawsuits and bad press over high levels of lead in the products, and I’m sure will take good news anywhere they can get it.

The nutritional supplement company announced that it has received a letter from the L.A. office of the SEC saying that they have completed their year long investigation into the company and has recommended that no action be taken agains the company.

Here’s how it all started…..apparently in mid 2007, the SEC began an investigation into some suspicious activity involving the timing of trading of Herbalife securities by a mid-level employee. The SEC was also investigating the extent of personal use of Herbalife products by distributors and the company’s related policies and procedures.

Herbalife cooperated fully with the SEC and its investigation over the last year and even disclosed to the public the accusations as well as the fact that they were being investigated.

I’m sure this comes as a huge relief to the company that the Securities and Exchange Commission has investigated the company’s practices thoroughly and found no wrong-doing. This is a small ray of hope for the company who is going through some rough times lately. They are still not out of the woods on the lead lawsuit but this was a big hurdle to get over and one they can finally put behind them.

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StockDiagnostics.com announced that Pre-Paid Legal, Inc has just received its number “1” ranking again for this past quarter based on their operational cash flow per share (NYSE: PPD). This is Pre-Paid’s 34th consecutive quarter at the number one spot.

Stock Diagnostics, founded in 2002, uses proprietary data to analyze the logical relationships between financial statement data and stock price performance. StockDiagnostics ranks company’s Operational cash Flow per share (OPS) a number they say is not as easily manipulated as the earning per share number, and can give a better idea of stock performance, their ability to maintain business operations for the long tern, and whether or not the stock is a good buy.

While the OPS for the first quarter for Pre Paid was slightly lower this quarter compared to first quarter last year, a 9 Cent difference, $1.68 in 2008 compared to $1.77 last year, the OPS for the last 12 months remained promising. In the last year, OPS was $4.96 per share compared to $4.22 in the previous year. Sales of Pre-Paid Legal are trading at $44.02, 12% higher than their one year low from 2007, $39.05.

StockDiagnostics monitors OPS for over 7,000 companies and ranks them mathematically into one of 8 different risk categories. The rankings are based on operational cash flow from the previous quarter as well as from the past year. Each time a company files a quarterly report, the numbers are re-calculated.

While this seems a bit confusing to me, StockDiagnostics claims that the numbers are based on carefully calculated mathematical numbers that analyze almost 2,000 data points of the publicly traded companies. Yet if you look at the companies stock chart, you sort of wonder what the real catalyst is here. The company also claims that the numbers cannot be manipulated as easily as other numbers, like the earnings per share. If nothing else, this is another great tool if you play the market to help make a more educated decision. For those of you more mathematically and stock market inclined, the site provides all the tools and information you will need. Many MLM companies are in and out of business so quickly that this might be a good tool to help examine the long term potential and sustainability of a company based on actual numbers.

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In the latest news on USANA’s bid to go private, the company has just announced that its board of directors has formed and independent panel to evaluate the buyout offer.

The buyout offer came a week ago from Gull Holdings, Ltd which is controlled by Myron Wentz who happens to also be the CEO of USANA, as well as the nutritional company’s largest shareholder.

The independent council has retained Morrison & Foerster LLP as a legal advisor. The council is planning to seek the advice of a financial advisor before reaching any kind of decision. Having worked with Morrison Foerester before, this is an excellent choice of firms for this potential transaction.

It looks like any kind of decision is still a few weeks away,….we will keep you up to date with any new developments.

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