Full Press Release Details
Ltd. Announces Record Second Quarter 2016 Volume Results
quarter 2016 volume points increased 9% compared to the second quarter
2015, representing the highest volume point quarter in the company's
quarter 2016 reported a loss of $0.28 per diluted share, which
includes the impact of $203 million related to regulatory settlements,
as compared to earnings of $0.97 per diluted share for the prior year
earnings of $1.29 per adjusted2
diluted share increased 4% compared to $1.24 per diluted share for the
comparable prior year quarter.
quarter 2016 reported net sales of $1.2 billion increased 3% and 10%
on an as reported and constant currency basis, respectively, compared
to the prior year period.
full year 2016 GAAP diluted EPS guidance in a range of $2.30 to $2.60.
Raises full year 2016 adjusted1
diluted EPS guidance to a range of $4.50 to $4.80; an increase from
the previous range of $4.40 to $4.75.
LOS ANGELES--(BUSINESS WIRE)--August 3, 2016--Herbalife Ltd. (NYSE: HLF)
reported second quarter net sales of $1.2 billion, reflecting an
increase of 3% compared to the prior year period. Second quarter 2016
net sales, excluding the impact of currency, grew by 10%. On a reported
basis, second quarter net loss of $22.9 million or ($0.28) per diluted
share which includes the impact of $203 million related to regulatory
settlements, compared to net income of $82.8 million or $0.97 per
diluted share for the comparable quarter in 2015. Adjusted1 earnings
for the quarter grew 4% to $1.29 per adjusted2 diluted share,
compared to $1.24 per diluted share for the second quarter in 2015. Due
to currency fluctuations, second quarter 2016 reported and adjusted1
net income were negatively impacted by $27.7 million and $26.6 million,
respectively, and reported EPS and adjusted1 earnings per
adjusted2 diluted share were negatively impacted by $0.32 and
$0.31, respectively.
Michael O. Johnson, chairman and CEO of Herbalife, stated "This has been
a historic quarter for Herbalife, with worldwide record setting volume
points and new volume point highs in four out of our six regions."
Johnson continued, "This momentum reflects the strength of our
distributors' businesses and with the FTC settlement announcement, I am
more confident than ever in Herbalife's future."
Second Quarter and 2016 Key Metrics3,4
Regional Volume Point and Average Active Sales Leader Metrics
| Volume Points (Mil) | Average Active Sales Leaders | ||||||
| Region | 2Q '16 | Yr/Yr % Chg | 2Q '16 | Yr/Yr % Chg | |||
| North America | 347.0 | 14% | 77,596 | 2% | |||
| Asia Pacific | 277.8 | 2% | 73,206 | -3% | |||
| EMEA | 276.9 | 21% | 80,268 | 13% | |||
| Mexico | 242.6 | 10% | 65,073 | 1% | |||
| South & Central America | 160.3 | -7% | 54,510 | -6% | |||
| China | 179.7 | 10% | 31,391 | 31% | |||
| Worldwide Total | 1,484.3 | 9% | 367,891 | 3% |
Regional Net Sales and Foreign Exchange ("FX") Impact
| Region | Reported Net Sales 2Q '16 (mil) | Growth/Decline including FX | Growth/Decline excluding FX | |||||
| North America | $ | 266.5 | 16 | % | 16 | % | ||
| Asia Pacific | $ | 234.6 | -2 | % | 2 | % | ||
| EMEA | $ | 219.0 | 13 | % | 20 | % | ||
| Mexico | $ | 119.3 | -8 | % | 9 | % | ||
| South & Central America | $ | 119.9 | -10 | % | 3 | % | ||
| China | $ | 242.5 | 2 | % | 8 | % | ||
| Worldwide Total | $ | 1,201.8 | 3 | % | 10 | % |
Based on current business trends the company's third quarter 2016 and
full year 2016 guidance is as follows:
| Three Months Ending | Twelve Months Ending | ||||
| September 30, 2016 | December 31, 2016 | ||||
| Low | High | Low | High | ||
| Volume Point Growth vs 2015 | 5.0% | 8.0% | 4.5% | 7.5% | |
| Net Sales Growth vs 2015 | 2.0% | 5.0% | 1.5% | 4.5% | |
| Diluted EPS | $0.74 | $0.84 | $2.30 | $2.60 | |
| Adjusted (a) Diluted EPS | $0.98 | $1.08 | $4.50 | $4.80 | |
| Cap Ex ($ millions) | $35.0 | $45.0 | $160.0 | $180.0 | |
| Effective Tax Rate | 28.0% | 30.0% | 27.5% | 29.5% | |
| Currency Adjusted (b) Net Sales Growth vs 2015 | 5.5% | 8.5% | 7.0% | 10.0% | |
| Currency Adjusted (b) EPS | $1.12 | $1.22 | $5.40 | $5.70 | |
| (a) Adjusted diluted EPS is a non-GAAP measure and excludes the impact of charges related to Venezuela, expenses relating to challenges to the company's business model, regulatory inquiries and implementation, expenses related to the recovery of re-audit expenses, foreign exchange impact, the impact of non-cash interest costs associated with the company's convertible notes, regulatory settlements and China grant income. See Schedule A - "Reconciliation of Non-GAAP Financial Measures" for a detailed reconciliation of adjusted diluted EPS to diluted EPS calculated in accordance with GAAP. | |||||
| (b) Excludes the impact of Venezuela price increases tied to FX rate movements. |
Forward guidance is based on the average daily exchange rates of the
first two weeks of July.
Adjusted diluted EPS guidance for the third quarter 2016 includes a
projected unfavorable impact from currency exchange rates of
approximately $0.14 per diluted share versus the third quarter of 2015.
Full year 2016 adjusted diluted EPS guidance includes a projected
currency headwind of approximately $0.90 per diluted share, compared to
2015, which is $0.20 higher than the headwind included in the guidance
the company provided a quarter ago.
Second Quarter 2016 Earnings Conference Call
Herbalife senior management will host an investor conference call to
discuss its recent financial results and provide an update on current
business trends on Wednesday, August 3, 2016, at 2:30 p.m. PT (5:30 p.m.
The dial-in number for this conference call for domestic callers is
(877) 317-1296, and (706) 634-5671 for international callers (conference
ID 38673773). Live audio of the conference call will be simultaneously
webcast in the investor relations section of the company's website at http://ir.herbalife.com.
An audio replay will be available following the completion of the
conference call in MP3 format or by dialing (855) 859-2056 for domestic
callers or (404) 537-3406 for international callers (conference ID
38673773). The webcast of the teleconference will be archived and
available on Herbalife's website.
About Herbalife Ltd.
Herbalife is a global nutrition company that has been changing people's
lives with great products since 1980. Our nutrition, weight-management,
energy and fitness and personal care products are available exclusively
to and through dedicated Herbalife Independent Members in more than 90
countries. We are committed to fighting the worldwide problems of poor
nutrition and obesity by offering high-quality products, one-on-one
coaching with an Herbalife Member and a community that inspires
customers to live a healthy, active life.
We support the Herbalife Family Foundation (HFF) and its Casa
Herbalife programs to help bring good nutrition to children in need. We
also sponsor more than 190 world-class athletes, teams and events around
the globe, including Cristiano Ronaldo, the LA Galaxy and champions in
The company has over 8,000 employees worldwide, and its shares are
traded on the New York Stock Exchange (NYSE: HLF) with net sales of $4.5
billion in 2015. The Herbalife website contains a significant amount of
financial and other information about the company at http://ir.Herbalife.com.
The company encourages investors to visit its website from time to time,
as information is updated and new information is posted. To learn more,
visit Herbalife.com or IAmHerbalife.com.
FORWARD-LOOKING STATEMENTS
This earnings release contains "forward-looking statements" within
the meaning of the safe harbor provisions of the Private Securities
Litigation Reform Act of 1995. Although we believe that the
expectations reflected in any of our forward-looking statements are
reasonable, actual results could differ materially from those projected
or assumed in any of our forward-looking statements. Our future
financial condition and results of operations, as well as any
forward-looking statements, are subject to change and to inherent risks
and uncertainties, such as those disclosed or incorporated by reference
in our filings with the Securities and Exchange Commission. Important
factors that could cause our actual results, performance and
achievements, or industry results to differ materially from estimates or