Greetings and welcome to the Nature's Sunshine Products' Second Quarter 2015 Earnings Conference Call. At this time all participants are in a listen-only mode. A question-and-answer session will follow the formal presentation. [Operator Instructions] As a reminder, this conference is being recorded. I would now turn the conference over to Mr. Richard Strulson, General Counsel and Chief Compliance Officer for Nature's Sunshine Products. Thank you, Mr. Strulson. You may now begin.

Good afternoon and thanks to all of you for joining our conference call to discuss our second quarter 2015 financial results. This call is available for replay in a live webcast that we posted on our Web site at www.naturessunshine.com in the Investor's section. The press release which was issued this afternoon at approximately 4:00 p.m. Eastern Time and the information on this call contains certain forward-looking statements, which are based on a number of assumptions that are subject to change and involve known and unknown risks, uncertainties or other factors which may not be under the company's control. These statements are often characterized by terminologies such as believe, hope, may, anticipate, expect, will, and other similar expressions. Forward-looking statements are not guarantees of future performance and the actual results, performance or achievement of the company may be materially different from the results, performance or other expectations implied by these forward-looking statements. These factors include, but are not limited to those factors disclosed in the company's Annual Report on Form 10-K, under the caption Risk Factors and other reports filed with the Securities and Exchange Commission. The press release and the information on this call speak only as of today's date and the company disclaims any duty to update the information provided herein and therein. I'll now turn the call over to Greg Probert, Chairman and CEO of Nature's Sunshine Products.

Thanks Rich. Good afternoon everyone and thank you for your participation in today's earnings call. Joining me today is Steve Bunker, our Executive Vice President, CFO and Treasurer. On today's call I will discuss performance of our business segments in detail, as well as update on our sales and profit improvement initiatives. So first let me begin with some key sales highlights from this quarter. In the second quarter sales of $81.2 million were down 7.7% on a local currency basis. The decrease was primarily driven by $6 million sales decline in our NSP Russia, Central and Eastern Europe segment. Excluding NSP Russia, Central and Eastern Europe, sales for the remaining business segments decreased by 1.5% year-over-year in local currency. We are encouraged by the fourth consecutive quarter of local currency sales growth, in Synergy Europe, NSP United States and NSP Canada. Our reduce growth was more than offset by softness in Synergy North America, Synergy South Korea and NSP Latin America. As previously discussed in mid-April we responded to soft sales by initiating a plan to improve earnings for reducing our SG&A cost, through streamline our operations and also initiating price increases. As a result, we expect to realize approximately $10 million to $15 million of annualized operating income improvement by Q4 of this year. Now, let's turn to our segments. NSP Americas second quarter sales of $45.0 million decreased by 0.3% year-over-year in local currencies and represented 55.5% of total company sales. NSP U.S., NSP Canada both recorded their fourth consecutive quarters of year-over-year growth of 0.6% and 4.2% in local currency respectively. Our new sales programs continue to gain traction and helped fuel this growth. We have seen increased adoption of both the IN.FORM sales method, which focuses on building a daily habit of health and weight…

Thanks Greg, and good afternoon everyone. Net sales in the quarter were $81.2 million, down 12.5% from $92.8 million in the same quarter last year. On a local currency basis net sales decreased 7.7% year-over-year. The decrease was primarily driven by 6.0 million decline in net sales revenues in the NSP Russia, Central and Eastern Europe segment, coupled with 4.5 million unfavorable impact from foreign currency exchange rate fluctuations. Excluding the net sales revenue decline in NSP Russia, Central and Eastern Europe, net sales for the remaining business segments decreased by 1.5% year-over-year in local currency. Costs of sales were 21.1 million down from 22.8 million in the year ago period. Cost of sales increased as a percentage of net sales in the second quarter of 2015 by 1.3% to 25.9% as compared to the same period in the prior year. The year-over-year increase was due to the strengthening of the U.S dollar against the local currencies in many of our foreign markets which has made our product manufactured in the U.S more expensive in those markets, as well as unfavorable changes in inventory reserves. Gross margin fell 130 basis points to 74.1% compared to 75.4% in the year ago period, primarily as a result of the decline in the revenue and the increase cost of sales percentage during the second quarter. Volume incentives accounted for 36.4% of net sales in the second quarter, relatively flat compared to 36.9% of net sales in the same period last year. The slight decrease was primarily due to reduced sales in NSP Russia, Central and Eastern Europe which pay higher volume incentives than our global average. As a reminder, volume incentives are a significant part of our network marketing program and are designed to provide incentive to reach higher product sales levels. Volume…

Thank you. We will now be conducting a question-and-answer session. [Operator Instructions] First question is from Mitch Pinheiro of Imperial Capital. Please go ahead.

Thank you. [Operator Instructions] And the next question is from Nelson Obus of Wynnefield Capital. Please go ahead.

I would now like to turn the conference back over to Mr. Probert for closing comments.

Thanks again for your support and participating in today's call. We like to remind everyone that next week of September 14th, Steve and I will be in New York City participating in two investor conferences. The B. Riley and Company Retail and Consumer Conference as well as Imperial Capital Global Opportunities conference. We hope to see many of you there. Have a great day. Thank you. Good bye.

Thank you. Ladies and gentlemen this concludes today's teleconference. You may disconnect your lines at this time. Thank you for your participation.