Herbalife Q3 – 2012 Sales +14% To $1 Billion

Michael Johnson Herbalife CEO


Herbalife Ltd. Announces Record Third Quarter 2012 and Introduces 2013 Earnings Guidance

  • Third quarter volume points of 1.2 billion increased 17 percent with double digit increases in each of its six regions compared to the prior year period.
  • Third quarter EPS of $1.04 increased 20 percent compared to the prior year period EPS.
  • Introducing FY'13 EPS guidance in a range of $4.40 to $4.55.
  • Board of directors approved a $0.30 per share quarterly dividend.

LOS ANGELES–(BUSINESS WIRE)– Herbalife Ltd. (NYSE: HLF) today reported third quarter record net sales of $1.0 billion, a 14 percent increase, driven by a 17 percent increase in volume points compared to the prior year period. The company reported net income of $117.8 million, or $1.04 per diluted share, compared to the third quarter 2011 net income of $108.0 million, or $0.87 per diluted share, reflecting an increase of 9 percent and 20 percent, respectively.

Our business momentum has continued through the third quarter with double digit volume growth from all six of our geographical regions, said Michael O. Johnson, the company's chairman and CEO. Our 2013 guidance for double-digit volume and EPS growth illustrates our belief in continued growth driven by the ongoing global expansion of daily consumption and our city by city approach to deepen our penetration in existing markets.

For the quarter ended September 30, 2012, the company generated cash flow from operations of $142.4 million, paid dividends of $32.4 million, and invested $20.0 million in capital expenditures. Also in the third quarter, the company repurchased $181.9 million in common shares outstanding, completing the $427.9 million repurchase agreement announced on May 3, 2012.

Third Quarter Regional Key Metrics1,2

Regional Volume Point and Average Active Sales Leader Metric

  Volume Points (Mil)   Average Active Sales Leaders
Region 3Q'12

Yr/Yr % Chg


Yr/Yr % Chg

North America 287.4 14 %   67,826 15 %
Asia Pacific 305.6 17 %   66,433 29 %
EMEA 145.5 10 %   44,861 14 %
Mexico 211.2 17 %   60,123 21 %
South & Central America 186.0 24 %   46,466 29 %
China 57.1 42 %   12,692 33 %
Worldwide Total 1,192.8 17 %   288,397 22 %

1 Supplemental tables that include additional business metrics can be found at https://www.ir.herbalife.com.

2 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 sales leaders are active in more than one region but are counted only once in the worldwide amount.

Updated 2012 Guidance

Guidance for fully diluted 2012 EPS is based on the average daily exchange rates of the first two weeks of October 2012.

Based on current business trends the company's fourth quarter fiscal 2012 and fiscal 2012 guidance is provided below.

  Three Months Ending   Twelve Months Ending

December 31, 2012


December 31, 2012

  Low High   Low High
Volume Point Growth vs 2011 13.0% 15.0%   18.0% 20.0%
Net Sales Growth vs 2011 17.0% 19.0%   16.0% 18.0%
Diluted EPS $0.97 $1.01   $3.99 $4.03
Cap Ex ($ millions) $50.0 $60.0   $110.0 $120.0
Effective Tax Rate 26.0% 28.0%   26.0% 28.0%

2013 Guidance

Guidance for 2013 assumes a Venezuelan FX rate of 10:1 compared to prior utilization of a 5.3 bolivars to 1 USD on all ongoing operations but excludes any potential one-time impact from a devaluation or the repatriation of existing cash balances.

  Twelve Months Ending

December 31, 2013




Volume Point Growth vs 2012







Net Sales Growth vs 2012







Diluted EPS







Cap Ex ($ millions)







Effective Tax Rate








Announces Quarterly Dividend

The company reported today that its board of directors has approved a dividend of $0.30 per share to shareholders of record on November 14, 2012, payable on November 28, 2012.

Third Quarter 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 Tuesday, October 30, 2012 at 8 a.m. PST (11 a.m. EST).

The dial-in number for this conference call for domestic callers is (877) 317-1296 and (706) 634-5671 for international callers (conference ID 33885084). Live audio of the conference call will be simultaneously webcast in the investor relations section of the company's website at https://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 33885084. The webcast of the teleconference will be archived and available on Herbalife's website.

About Herbalife Ltd.

Herbalife Ltd. (NYSE:HLF) is a global nutrition company that sells weight-management, nutrition, and personal care products intended to support a healthy lifestyle. Herbalife products are sold in 85 countries to and through a network of independent distributors. The company supports the Herbalife Family Foundation and its Casa Herbalife program to help bring good nutrition to children. Herbalife's website contains information about Herbalife, including financial and other information for investors at https://ir.Herbalife.com. The company encourages investors to visit its website from time to time, as information is updated and new information is posted.

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