Andersen Ranch & Farm : HOME

Well, we've known it was going to happen but it's still a shock when it finally does. Yesterday was the hardest day I've had at Nu Skin, watching people I've worked with for a few years and have really enjoyed. . . . as they packed up their belongings and walked out the door. This is the following article that appeared in the local paper today. Thought you might be interested. . . . . .


Wednesday, March 08, 2006
Nu Skin lays off about 50

GRACE LEONG - Daily Herald
Nu Skin Enterprises on Tuesday laid off about 50 workers at its Provo corporate office as part of a restructuring of its global direct-selling operations that's expected to be completed by March 31.
Unfavorable foreign currency fluctuations had weakened the company's revenues, prompting it to lower its fourth and first quarter earnings guidance, and to launch plans to "eliminate organizational redundancies and revamp administrative support functions," said Truman Hunt, Nu Skin's president and CEO in a statement in December.
"We're in early stages of restructuring. That's why we adjusted our earnings guidance," said Blake Roney, founder of Nu Skin. "We're looking for redundancies companywide, and may combine some of our research and development functions globally. Currently, the Nu Skin personal care line is completely independent in terms of its R&D functions from our Pharmanex division. We may try to combine the two divisions' backoffice functions wherever it makes sense."
Kara Schneck, senior director of public relations, said the company had announced the planned restructuring a few months ago and has provided "very generous severance packages and outplacement services" to the affected workers.
Nu Skin has around 1,400 workers in Utah County. Among those laid off Tuesday was John Petersen, who had served at Nu Skin for about 15 years in community relations, and was most recently the director of corporate public relations, a position he held for two years.
Petersen said he had heard that up to 10 percent of Nu Skin's work force was laid off, but couldn't confirm if those numbers were accurate. Schneck declined to specify how many layoffs have occurred to date and how many more are expected in the coming weeks.
"The layoffs are an ongoing process. Some occurred today and it came from various departments in Nu Skin's corporate office. In some cases, the layoffs were due to redundancies in some departments," Schneck said. "But those that used the outplacement services get jobs twice as fast as those that didn't."
Petersen said he wasn't surprised by the company's move and described his severance package as "very generous."
"There've been rumors of planned layoffs for the past few weeks," Petersen said. "Kara invited me to her office this morning and both her and someone from HR said my position didn't exist anymore, and they explained the severance package to me, and the package was very generous. Kara made it as humane as possible. I had as much time as I needed to say goodbye to my colleagues."
"We've been told that the company is doing well, but it can always do better. The business would be better because of the changes they're making. I'm sorry I was of the people that were let go, but I already have other irons in the fire. This will give me the chance to try something I wasn't able to do before in a 9 to 5 job," Petersen said.
In its fourth-quarter earnings statement issued Feb. 8, Nu Skin lowered its guidance for the first quarter ending March 31, anticipating a 12-cent to 22-cent loss per share because of restructuring charges.
"The restructuring charges are expected to include $10 to $15 million of severance expenses and approximately $5 million of expenses related to other streamlining initiatives," Hunt said in the statement.