MANNATECH INC 10-K

Item 7A. Quantitative and Qualitative Disclosures About Market Risk We do not engage in trading market risk sensitive instruments and do not purchase investments as hedges or for purposes “other than trading” that are likely to expose us to certain types of market risk, including interest rate, commodity price, or equity price risk. Although we have investments, we believe there has been no material change in our exposure to interest rate risk. We have not issued any debt instruments, entered into any forward or futures contracts, purchased any options, or entered into any swap agreements. We are exposed, however, to other market risks, including changes in currency exchange rates as measured against the United States dollar. Because the change in value of the United States dollar measured against foreign currency may affect our consolidated financial results, changes in foreign currency exchange rates could positively or negatively affect our results as expressed in United States dollars. For example, when the United States dollar strengthens against foreign currencies in which our products are sold or weakens against foreign currencies in which we may incur costs, our consolidated net sales or related costs and expenses could be adversely affected. We translate our revenues and expenses in foreign markets using an average rate. We believe inflation has not had a material impact on our consolidated operations or profitability. We maintain policies, procedures, and internal processes in an effort to help monitor any significant market risks and we do not use any financial instruments to manage our exposure to such risks. We assess the anticipated foreign currency working capital requirements of our foreign operations and maintain a portion of our cash and cash equivalents denominated in foreign currencies sufficient to satisfy most of these anticipated requirements. We caution that we cannot predict with any certainty our future exposure to such currency exchange rate fluctuations or the impact, if any, such fluctuations may have on our future business, product pricing, operating expenses, and on our consolidated financial position, results of operations, or cash flows. However, to combat such market risk, we closely monitor our exposure to currency fluctuations. The regions and countries in which we currently have exposure to foreign currency exchange rate risk include (i) North America/South America (Canada, Colombia and Mexico); (ii) EMEA (Austria, the Czech Republic, Denmark, Estonia, Finland, Germany, the Republic of Ireland, the Netherlands, Norway, South Africa, Spain, Sweden, Switzerland and the United Kingdom); and (iii) Asia/Pacific (Australia, Japan, New Zealand, the Republic of Korea, Singapore, Taiwan, Hong Kong and China). The current (spot) rate, average currency exchange rates, and the low and high of such currency exchange rates as compared to the United States dollar, for each of these countries as of and for the year ended December 31, 2021 were as follows: Year ended December 31, 2021 As of December 31, 2021 Country (foreign currency name) Low High Average Spot Australia (Australian Dollar) 0.70019 0.79516 0.75158 0.72575 Canada (Canadian Dollar) 0.77363 0.83015 0.79796 0.78254 China (Renminbi) 0.15222 0.15751 0.15504 0.15698 Colombia (Peso) 0.00025 0.00029 0.00027 0.00025 Czech Republic (Koruna) 0.04394 0.04819 0.04615 0.04547 Denmark (Kroner) 0.15082 0.16555 0.15915 0.15231 Hong Kong (Hong Kong Dollar) 0.12816 0.12901 0.12867 0.12823 Japan (Yen) 0.00867 0.00972 0.00912 0.00869 Mexico (Peso) 0.04565 0.05100 0.04935 0.04868 New Zealand (New Zealand Dollar) 0.67204 0.74244 0.70760 0.68359 Norway (Krone) 0.10903 0.12215 0.11645 0.11360 Republic of Korea (Won) 0.00084 0.00092 0.00087 0.00084 Singapore (Singapore Dollar) 0.72917 0.75882 0.74444 0.73951 South Africa (Rand) 0.06149 0.07455 0.06779 0.06276 Sweden (Krona) 0.10932 0.12242 0.11670 0.11059 Switzerland (Franc) 1.05953 1.13849 1.09446 1.09274 Taiwan (New Taiwan Dollar) 0.03495 0.03631 0.03582 0.03611 United Kingdom (British Pound) 1.32070 1.41980 1.37596 1.34915 Various countries (1) (Euro) 1.12148 1.23148 1.18343 1.13257 (1) Austria, Germany, the Netherlands, Estonia, Finland, the Republic of Ireland and Spain 56 Table of Contents Item 8. Financial Statements and Supplementary Data Our Consolidated Financial Statements and Supplementary Data required by this Item 8 are set forth in Item 15 of this report. Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure None.