- Second quarter 2016 volume points
increased 9% compared to the second quarter 2015, representing the
highest volume point quarter in the company’s history.
- Second 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 quarter.
Adjusted1 earnings of $1.29 per adjusted2
diluted share increased 4% compared to $1.24 per diluted share
for the comparable prior year quarter.
- Second 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.
- Establishes 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.
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 %
Outlook
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. ET).
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 many other sports.
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 projections contained in our
forward-looking statements include, among others, the
following:
- our relationship with, and our ability
to influence the actions of, our Members;
- improper action by our employees or
Members in violation of applicable law;
- adverse publicity associated with our
products or network marketing organization, including our ability
to comfort the marketplace and regulators regarding our compliance
with applicable laws;
- changing consumer preferences and
demands;
- the competitive nature of our
business;
- regulatory matters governing our
products, including potential governmental or regulatory actions
concerning the safety or efficacy of our products and network
marketing program, including the direct selling market in which we
operate;
- legal challenges to our network
marketing program;
- the consent order entered into with the
FTC, the effects thereof and any failure to comply therewith;
- risks associated with operating
internationally and the effect of economic factors, including
foreign exchange, inflation, disruptions or conflicts with our
third party importers, pricing and currency devaluation risks,
especially in countries such as Venezuela;
- uncertainties relating to
interpretation and enforcement of legislation in China governing
direct selling;
- our inability to obtain the necessary
licenses to expand our direct selling business in China;
- adverse changes in the Chinese
economy;
- our dependence on increased penetration
of existing markets;
- contractual limitations on our ability
to expand our business;
- our reliance on our information
technology infrastructure and outside manufacturers;
- the sufficiency of trademarks and other
intellectual property rights;
- product concentration;
- our reliance upon, or the loss or
departure of any member of, our senior management team which could
negatively impact our Member relations and operating results;
- U.S. and foreign laws and regulations
applicable to our international operations;
- restrictions imposed by covenants in
our credit facility;
- uncertainties relating to the
application of transfer pricing, duties, value added taxes, and
other tax regulations, and changes thereto;
- changes in tax laws, treaties or
regulations, or their interpretation;
- taxation relating to our Members;
- product liability claims;
- our incorporation under the laws of the
Cayman Islands;
- whether we will purchase any of our
shares in the open markets or otherwise; and
- share price volatility related to,
among other things, speculative trading and certain traders
shorting our common shares.
We do not undertake any obligation to update or release any
revisions to any forward-looking statement or to report any events
or circumstances after the date hereof or to reflect the occurrence
of unanticipated events, except as required by law.
1 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,
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. Full year adjusted diluted EPS guidance also
excludes charges related to regulatory implementation. 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 and a discussion of why we believe this
non-GAAP measure is useful.
2 See Schedule A - “Reconciliation of Non-GAAP Financial
Measures” for a reconciliation of adjusted diluted share count to
reported diluted share count and a discussion of why the share
count has been adjusted for purposes of calculating adjusted
diluted EPS for the second quarter of 2016.
3 Supplemental tables that include additional business metrics
can be found at http://www.ir.herbalife.com.
4 Worldwide Average Active Sales Leaders may not equal the sum
of the Average Active Sales Leaders in each region due to the
calculation being an average of Sales Leaders active in a period,
not a summation, and the fact that some are active in more than one
region but are counted only once in the worldwide amount.
RESULTS OF OPERATIONS:
Herbalife
Ltd. and Subsidiaries Condensed Consolidated Statements of (Loss)
Income (In millions, except per share amounts) (Unaudited)
Three Months Ended Six
Months Ended
6/30/2016
6/30/2015
6/30/2016
6/30/2015
North America $ 266.5 $ 230.0 $ 512.5 $ 456.7 Mexico 119.3
129.2 229.0 252.8 South and Central America 119.9 133.5 246.9 295.2
EMEA 219.0 193.8 417.4 380.2 Asia Pacific 234.6 239.1 455.7 481.9
China 242.5 236.7 459.9
400.9 Worldwide Net Sales 1,201.8 1,162.3 2,321.4 2,267.7 Cost of
Sales (1) 236.3 229.3 449.4
444.7 Gross Profit 965.5 933.0 1,872.0 1,823.0 Royalty
Overrides 336.7 318.7 648.6 641.7 Selling, General and
Administrative Expenses (2) 676.8 470.5 1,103.9 901.9 Other
Operating Income (3) (28.1 ) - (28.9 )
- Operating (Loss) Income (19.9 ) 143.8 148.4 279.4 Interest
Expense, net 23.1 23.7 48.0 45.2 Other Expense, net (4) -
- - 2.3 (Loss) Income Before
Income Taxes (43.0 ) 120.1 100.4 231.9 Income Taxes (20.1 )
37.3 27.5 70.9 Net (Loss) Income $
(22.9 ) $ 82.8 $ 72.9 $ 161.0 Weighted Average Shares
Outstanding: Basic 83.0 82.6 82.9 82.5 Diluted 83.0 85.2 85.9 84.8
(Loss) Earnings Per Share: Basic $ (0.28 ) $ 1.00 $ 0.88
$ 1.95 Diluted $ (0.28 ) $ 0.97 $ 0.85 $ 1.90
(1)
Cost of Sales includes $0.3 million and $1.7 million of inventory
write downs related to Venezuela for the three and six months ended
June 30, 2015, respectively. (2) Selling, General and
Administrative Expenses includes $203 million related to regulatory
settlements for the three and six months ended June 30, 2016 and
includes $0.3 million and $32.9 million pre-tax unfavorable impact
related to the remeasurement of Venezuela Bolivar-denominated
assets and liabilities at the SIMADI rate for the three and six
months ended June 30, 2015. (3) Other Operating Income relates to
China grant income. (4) Other Expense, net relates to the
impairment of investments in Bolivar-denominated bonds for the six
months ended June 30, 2015. Herbalife
Ltd. and Subsidiaries Condensed Consolidated Balance Sheets (In
millions) (Unaudited) Jun 30, Dec 31,
2016 2015
ASSETS Current Assets: Cash & cash equivalents $ 936.7 $ 889.8
Receivables, net 94.1 69.9 Inventories 322.5 332.0 Prepaid expenses
and other current assets 193.2 161.1 Deferred income tax assets
114.8 113.5 Total Current Assets
1,661.3 1,566.3 Property, net 371.5 339.2 Deferred
compensation plan assets 29.5 29.3 Other assets 148.1 141.1
Marketing related intangibles and other intangible assets, net
310.1 310.2 Goodwill 93.4 91.8 Total
Assets $ 2,613.9 $ 2,477.9 LIABILITIES
AND SHAREHOLDERS' EQUITY (DEFICIT) Current Liabilities: Accounts
payable $ 85.4 $ 71.1 Royalty overrides 247.1 249.9 Accrued
compensation 115.3 128.8 Accrued expenses 455.8 228.7 Current
portion of long-term debt 423.3 229.5 Advance sales deposits 101.4
63.8 Income taxes payable 29.4 52.6
Total Current Liabilities 1,457.7 1,024.4 Non-current
liabilities Long-term debt, net of current portion 1,003.3 1,392.5
Deferred compensation plan liability 46.9 43.6 Deferred income tax
liabilities 0.4 0.4 Other non-current liabilities 70.1
70.5 Total Liabilities 2,578.4 2,531.4
Contingencies Shareholders' equity (deficit): Common shares
0.1 0.1 Paid-in capital in excess of par value 457.3 438.2
Accumulated other comprehensive loss (168.5 ) (165.5 ) Accumulated
deficit (253.4 ) (326.3 ) Total Shareholders' Equity
(Deficit) 35.5 (53.5 ) Total
Liabilities and Shareholders' Equity (Deficit) $ 2,613.9 $
2,477.9
Herbalife Ltd. and Subsidiaries
Condensed Consolidated Statements of Cash Flows (In millions)
(Unaudited) Six Months Ended
6/30/2016
6/30/2015 CASH FLOWS FROM
OPERATING ACTIVITIES Net income $ 72.9 $
161.0
Adjustments to reconcile net income to net cash provided by
operating activities: Depreciation and amortization 47.9 48.0
Excess tax benefits from share-based payment arrangements (2.1 )
(1.5 ) Share-based compensation expenses 20.5 23.9 Non-cash
interest expense 28.7 25.5 Deferred income taxes (21.2 ) (2.5 )
Inventory write-downs 11.2 17.7 Foreign exchange transaction gain
(2.9 ) (12.3 ) Foreign exchange loss and other charges relating to
Venezuela 4.8 36.9 Other (5.9 ) 9.3 Changes in operating assets and
liabilities: Receivables (20.4 ) (24.4 ) Inventories (0.2 ) 16.5
Prepaid expenses and other current assets 5.7 6.4 Other assets (5.2
) (10.1 ) Accounts payable 17.4 16.8 Royalty overrides (1.4 ) (9.3
) Accrued expenses and accrued compensation 219.3 50.1 Advance
sales deposits 37.3 31.8 Income taxes (40.8 ) (26.6 ) Deferred
compensation plan liability 2.4 1.5 NET
CASH PROVIDED BY OPERATING ACTIVITIES 368.0
358.7 CASH FLOWS FROM INVESTING ACTIVITIES Purchases of
property, plant and equipment (86.9 ) (39.9 ) Other 4.5
5.6 NET CASH (USED IN) INVESTING ACTIVITIES
(82.4 ) (34.3 ) CASH FLOWS FROM FINANCING ACTIVITIES
Principal payments on senior secured credit facility and other debt
(229.7 ) (163.8 ) Issuance costs relating to long-term debt - (6.2
) Share repurchases (4.5 ) (9.1 ) Excess tax benefits from
share-based payment arrangements 2.1 1.5 Other (1.4 )
0.9 NET CASH (USED IN) FINANCING ACTIVITIES (233.5 )
(176.7 ) EFFECT OF EXCHANGE RATE CHANGES ON CASH (5.2
) (43.5 ) NET CHANGE IN CASH AND CASH EQUIVALENTS 46.9 104.2
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD 889.8
645.4 CASH AND CASH EQUIVALENTS, END OF PERIOD $
936.7 $ 749.6
SUPPLEMENTAL INFORMATION
SCHEDULE A: RECONCILIATION OF NON-GAAP FINANCIAL MEASURES
(Unaudited and unreviewed), (All tables provide Dollars in
millions, Except per Share Data)
In addition to its reported results and guidance calculated in
accordance with GAAP, the company has included in this release
adjusted net income and adjusted diluted EPS, performance measures
that the Securities and Exchange Commission defines as “non-GAAP
financial measures.” Management believes that such non-GAAP
financial measures, when read in conjunction with the company’s
reported or forecasted results, in each case calculated in
accordance with GAAP, can provide useful supplemental information
for investors because they facilitate a period to period
comparative assessment of the company’s operating performance
relative to its performance based on reported or forecasted results
under GAAP, while isolating the effects of some items that vary
from period to period without any correlation to core operating
performance and eliminate certain charges that management believes
do not reflect the company’s operations and underlying operational
performance. The company’s definition of adjusted net income and
adjusted diluted earnings per share may not be comparable to
similarly titled measures of other companies because other
companies may not calculate them in the same manner as the company
does and should not be viewed in isolation from nor as alternatives
to net income or diluted EPS calculated in accordance with
GAAP.
The following is a reconciliation of net
income, presented and reported in accordance with U.S. generally
accepted accounting principles, to net income adjusted for certain
items:
Three Months Ended Six Months Ended
6/30/2016 6/30/2015 6/30/2016
6/30/2015 (in millions) Net (loss) income, as
reported $ (22.9 ) $ 82.8 $ 72.9 $ 161.0 Remeasurement, impairment
losses and other charges relating to Venezuela (1)(2) - 0.6 - 36.9
Expenses incurred responding to attacks on the company's business
model (1) (3) 4.6 7.1 7.5 11.4 Expenses related to Regulatory
inquiries (1) (4) 2.5 5.8 10.1 9.2 Expenses incurred for the
recovery of re-audit expenses (1) (5) 1.9 0.4 3.3 0.6 Foreign
exchange loss (gain) from Euro/USD exposure on intercompany
balances (1) (6) - 5.4 - (7.4 ) Non-cash interest expense and
amortization of non-cash issuance costs (1) (7) 11.2 10.6 22.2 21.0
Regulatory settlements (1) (8) 203.0 - 203.0 - China grant income
(1) (9) (28.1 ) - (28.9 ) - Income tax adjustments for above items
(1) (10) (60.9 ) (7.1 ) (63.4 ) (18.3 )
Net income, as adjusted (11) $ 111.2 $ 105.6 $ 226.8
$ 214.4
The following table is a reconciliation
of diluted shares outstanding, presented and reported in accordance
with GAAP, to diluted shares outstanding, adjusted for the impact
of outstanding equity awards. Outstanding equity awards were
excluded from the number of reported diluted outstanding shares for
the second quarter of 2016 because the Company reported a net loss
for the second quarter of 2016 and their inclusion would be
anti-dilutive. However, because the company’s adjusted net income
for the second quarter of 2016, as calculated in the table above,
was positive, inclusion of outstanding equity awards would not be
anti-dilutive. Therefore, the company has adjusted the diluted
shares outstanding for the second quarter of 2016 to include equity
awards as set forth below so the calculation of adjusted diluted
EPS is not overstated for the second quarter of 2016 and such
number is comparable to adjusted diluted EPS for the prior year
period.
Three Months Ended Six Months Ended 6/30/2016
6/30/2015 6/30/2016
6/30/2015 (in millions) Diluted shares outstanding,
as reported 83.0 85.2 85.9 84.8 Potential dilutive effect of
outstanding equity grants 3.2 -
- - Diluted shares outstanding, as adjusted
86.2 85.2 85.9
84.8
The following is a reconciliation of
diluted earnings per share, presented and reported in accordance
with U.S. generally accepted accounting principles, to diluted
earnings per share adjusted for certain items.
Three Months Ended Six Months Ended 6/30/2016
6/30/2015 6/30/2016 6/30/2015
Diluted (loss) earnings per share, as reported $
(0.28 ) $ 0.97 $ 0.85 $ 1.90 Remeasurement, impairment losses and
other charges relating to Venezuela (1)(2) - 0.01 - 0.44 Expenses
incurred responding to attacks on the company's business model (1)
(3) 0.05 0.08 0.09 0.13 Expenses related to Regulatory inquiries
(1) (4) 0.03 0.07 0.12 0.11 Expenses incurred for the recovery of
re-audit expenses (1) (5) 0.02 - 0.04 0.01 Foreign exchange loss
(gain) from Euro/USD exposure on intercompany balances (1) (6) -
0.06 - (0.09 ) Non-cash interest expense and amortization of
non-cash issuance costs (1) (7) 0.13 0.12 0.26 0.25 Regulatory
settlements (1) (8) 2.36 - 2.36 - China grant income (1) (9) (0.33
) - (0.34 ) - Income tax adjustments for above items (1) (10)
(0.71 ) (0.08 ) (0.74 ) (0.22 ) Diluted
earnings per share, as adjusted (11) $ 1.29 $ 1.24 $
2.64 $ 2.53
(1) Based on interim income tax
reporting rules, these expenses are not considered discrete items.
As a result, the company's full year effective tax rate is impacted
by these items. When applying the full year effective tax rate to
year-to-date income, the company's year-to-date tax provision
recorded with respect to these non-GAAP adjustments is different
from the forecasted full-year tax provision impact of these items.
As a consequence, adjustments to the year-to-date and quarterly tax
impacts will be recorded as the adjusted full year effective tax
rate is applied to income in subsequent periods. Additionally,
adjustments to items unrelated to these non-GAAP adjustments may
have an effect on the income tax impact of these non-GAAP
adjustments in subsequent periods. The company plans to update the
income tax impact of these items in subsequent interim reporting
periods. (2) Excludes tax impact of $1.0 million and $12.1 million
for the three and six months ended June 30, 2015, respectively. (3)
Excludes tax impact of $1.3 million and $2.3 million for the three
months ended June 30, 2016 and 2015, respectively; and $1.9 million
and $3.7 million for the six months ended June 30, 2016 and 2015,
respectively. (4) Excludes tax impact of $0.9 million and $2.1
million for the three months ended June 30, 2016 and 2015,
respectively; and $3.7 million and $3.4 million for the six months
ended June 30, 2016 and 2015, respectively. (5) Excludes tax impact
of $0.6 million and $0.1 million for the three months ended June
30, 2016 and 2015, respectively; and $1.1 million and $0.2 million
for the six months ended June 30, 2016 and 2015, respectively. (6)
Excludes tax impact of $2.1 million and ($0.6) million for the
three and six months ended June 30, 2015, respectively. (7) Relates
to non-cash expense on our convertible notes and prepaid forward
share repurchase contract. Excludes tax impact of ($0.1) million
and ($0.4) million for the three months ended June 30, 2016 and
2015, respectively; and ($1.3) million and ($0.5) million for the
six months ended June 30, 2016 and 2015, respectively. (8) Excludes
tax impact of $66.5 million for the three and six months ended June
30, 2016. (9) Excludes tax impact of ($8.2) million and ($8.4)
million for the three and six months ended June 30, 2016. (10)
Aggregates the individual tax impacts of each item as described in
greater detail in footnotes 2-9 above. (11) Amounts may not total
due to rounding. The following is a reconciliation of
diluted earnings per share guidance, presented in accordance with
U.S. generally accepted accounting principles, to diluted earnings
per share adjusted guidance for certain items.
Three Months Ending Twelve Months Ending
September 30, 2016 December 31, 2016 Diluted EPS
Guidance $0.74 - $0.84 $2.30 - $2.60 Expenses incurred responding
to attacks on the company's business model (1) $0.05 $0.18 Expenses
related to Regulatory inquiries and implementation (2) $0.10 $0.29
Expenses incurred for the recovery of re-audit fees (3) $0.04 $0.12
Non-cash interest expense and amortization of non-cash issuance
costs (4) $0.13 $0.52 Regulatory settlements (5) - $2.36 China
Grant Income (6) - ($0.34) Income tax adjustments for above items
(7) ($0.09) ($0.90) Adjusted Diluted EPS Guidance (8) $0.98 - $1.08
$4.50 - $4.80
(1) Excludes tax impact of $0.9 million
and $3.6 million for the three months ended September 30, 2016, and
twelve months ending December 31, 2016, respectively.
(2) Excludes tax impact of $3.2 million
and $10.1 million for the three months ended September 30, 2016,
and twelve months ending December 31, 2016, respectively.
(3) Excludes tax impact of $1.1 million
and $3.3 million for the three months ended September 30, 2016, and
twelve months ending December 31, 2016, respectively.
(4) Excludes tax impact of $0.7 million
for the three months ended September 30, 2016.
(5) Excludes tax impact of $1.7 million
and $69.8 million for the three months ended September 30, 2016,
and twelve months ending December 31, 2016, respectively.
(6) Excludes tax impact of $0.0 million
and ($8.4) million for the three months ended September 30, 2016,
and twelve months ending December 31, 2016, respectively.
(7) Aggregates the individual tax impacts of each item as described
in greater detail in footnotes 1-6 above. (8) Amounts may not total
due to rounding.
View source
version on businesswire.com: http://www.businesswire.com/news/home/20160803006561/en/
Herbalife Ltd.Media Contact:Jennifer ButlerVP, Media
Relations213.745.0420orInvestor Contact:Alan QuanVP, Investor
Relations213.745.0541
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