Herbalife Ltd. Announces First Quarter 2009 Results
LOS ANGELES--(BUSINESS WIRE)-- Herbalife Ltd. (NYSE: HLF) today reported first quarter 2009 net sales of $521.7 million, a decrease of 13.7 percent compared to the same period of 2008, primarily reflecting the unfavorable impact of currency fluctuations. Excluding the impact from currency fluctuations, local currency year-over-year net sales declined 0.9 percent. For the quarter ended March 31, 2009, the company reported net income of $41.5 million, or $0.67 per diluted share, compared to $62.4 million, or $0.93 per diluted share in the first quarter of 2008, reflecting lower net sales attributable to unfavorable currency fluctuations, coupled with a higher effective tax rate reflecting country mix, partially offset by accretion from the company's share repurchase program. Excluding the impact from adjusting items in the first quarter (1), adjusted net income was $41.9 million, or $0.68 in adjusted diluted earnings per share, reflecting a decrease of 32.7 percent and 26.9 percent, respectively, compared to the same period in 2008.
In the first quarter, the company produced cash flow from operations of $86.0 million, paid a quarterly dividend of $12.3 million and invested $14.4 million in capital expenditures, primarily relating to its global roll-out of Oracle. The company's net debt balance (1) at the end of the quarter was $150.7 million, reflecting an improvement of $50.0 million from December 2008.
"During these challenging economic times and unprecedented fluctuations in currency rates, we continue to focus on areas of the business that we can control to improve our cash generation and cash allocation," said Chairman and Chief Executive Officer Michael O. Johnson. "I am very pleased that in these unprecedented economic times, excluding currency fluctuations, our net sales are off less than one percent from a year ago. This is a reflection of the outstanding commitment of our Distributors and the resilience of our business model. We are in a unique position to succeed during economic downturns because we offer an opportunity for part-time or full-time income, and healthy nutrition and weight management products in the midst of a global obesity epidemic. Our message to our distributors is straightforward - have confidence in yourself and our company because there has never been a better time to introduce someone to Herbalife."
During the first quarter 2009 we added 40,259 new Sales Leaders (2), which is 17.5 percent lower than the same period in the prior year. Additionally, total Sales Leaders (2) decreased 3.1 percent to 340,714 in the first quarter of 2009 compared to the same period in 2008, which reflects a slight reduction in retention, 40.3 percent as of the requalification period in 2009 versus 41.0 percent in the 2008 requalification period, coupled with fewer new sales leaders in 2009. During the first quarter 2009, the company's President's Team membership increased 9.1 percent to 1,197 members versus the first quarter of 2008 and our prestigious Chairman's Club and China Brand Ambassador membership increased 5.7 percent to 37 members, versus the first quarter of 2008.
Business Highlights
The company hosted three Extravaganzas during the first quarter, in Chile, Colombia and Panama, which were attended by over 18,300 distributors. Additionally the company hosted its annual Honors event in Los Angeles, where 1,500 distributor leaders shared great ideas, trained each other on new business methods, discussed strategies to grow their businesses and participated in the Mark Hughes Bonus awards totaling $36.4 million.
The company presented a "Why Herbalife, Why Now?" tour featuring our chairman and CEO, who traveled to seven U.S. cities during January and four cities in Mexico during March, meeting with more than 30,000 attendees. During the quarter, the company also hosted a "Doctor's Tour" featuring Dr. Luigi Gratton who traveled to 11 cities and met with close to 10,000 distributors. In addition, our regional management teams and distributor leaders have met with thousands more distributors and potential distributors throughout our Europe, Middle East and Africa, Mexico, South and Central America, Asia Pacific, and China regions.
First Quarter 2009 Regional Key Metrics
Volume Increase/ New Increase/ Total Increase/
Points (Decrease) Sales (Decrease) Sales (Decrease)
Region (Mil) (Y/Y) Leaders (Y/Y) Leaders (Y/Y)
North America 186.5 4.7 % 7,893 (12.4 %) 67,097 (1.0 %)
Asia Pacific 145.0 36.4 % 10,737 22.3 % 64,417 7.0 %
EMEA 124.1 (9.5 %) 5,236 (19.9 %) 55,461 (10.3 %)
Mexico 120.4 (18.7 %) 4,351 (40.8 %) 52,136 (17.6 %)
South & Central 102.6 (13.7 %) 7,715 (39.6 %) 70,532 (1.9 %)
America
China 20.8 0.5 % 4,327 (0.5 %) 31,071 17.2 %
The North America region reported volume points of 186.5 million in the first quarter of 2009, reflecting an increase of 4.7 percent versus the same period of 2008. Volume point growth in the U.S., the largest country in the region, increased 5.2 percent compared to 2008, reflecting an increase in the Latin and general markets of eight percent and one percent, respectively. New Sales Leaders in the region were 7,893 during the quarter ended March 31, 2009, a decrease of 12.4 percent versus the same period last year. Total Sales Leaders in the region decreased 1.0 percent to 67,097 as of March 31, 2009 versus March 31, 2008.
The Asia Pacific region reported volume points of 145.0 million in the first quarter of 2009, reflecting an increase of 36.4 percent over the same period of 2008. Top markets in this region were Taiwan, with volume point growth of 61.2 percent; Korea, with volume point growth of 57.9 percent; and Malaysia with volume point growth of 58.8 percent, all compared to the same period in 2008. New Sales Leaders in the region were 10,737 during the quarter ended March 31, 2009, an increase of 22.3 percent versus the same period last year. Total Sales Leaders increased 7.0 percent to 64,417 as of March 31, 2009 versus March 31, 2008.
The Europe, Middle East and Africa (EMEA) region reported volume points of 124.1 million in the first quarter of 2009, reflecting a decrease of 9.5 percent versus the same period of 2008. Top markets in this region were Italy, with volume point growth of 9.4 percent and Russia with volume point growth of 1.6 percent, both compared to the same period in 2008. New Sales Leaders in the region were 5,236 during the quarter ended March 31, 2009, a decrease of 19.9 percent versus the same period last year. Total Sales Leaders in the region decreased 10.3 percent to 55,461 as of March 31, 2009 versus March 31, 2008.
The Mexico region reported volume points of 120.4 million in the first quarter of 2009, reflecting a decrease of 18.7 percent versus the same period of 2008. During the third quarter of 2008, the company began collecting a Value Added Tax (VAT) from our Mexican distributors that has had a negative impact on our financial results. Distributors in Mexico previously paid zero percent VAT on their purchases for most of our nutrition products. This effective price increase, which impacts approximately 60 percent of our volume points in the Mexican market, adversely affected sales in Nutrition Clubs, which are retail price-sensitive, and as a result has caused volumes to decline from pre-VAT levels. We are in the process of challenging this assessment on several fronts; however, as the products continue to be subject to this VAT, we expect year-over-year volume growth to be constrained. New Sales Leaders in the Mexico region were 4,351 during the quarter ended March 31, 2009, or 40.8 percent lower than the same period last year. Total Sales Leaders in the region decreased 17.6 percent to 52,136 as of March 31, 2009 versus March 31, 2008.
The South and Central American region reported volume points of 102.6 million in the first quarter of 2009, reflecting a decrease of 13.7 percent versus the same period of 2008. The top markets in this region were Brazil, with volume point growth of 13.8 percent and Venezuela, with a volume point decline of 40.8 percent, both compared to the same period in 2008. New Sales Leaders in the region were 7,715 during the quarter ended March 31, 2009, or 39.6 percent lower than the same period last year. Total Sales Leaders in the region decreased 1.9 percent to 70,532 as of March 31, 2009 versus March 31, 2008.
The China region reported volume points of 20.8 million in the first quarter of 2009, reflecting an increase of 0.5 percent over the same period of 2008. The company is currently licensed for direct sales in six provinces and has submitted applications for five additional provinces. New Sales Employees in China were 4,327 during the quarter ended March 31, 2009, a decrease of 0.5 percent versus the same period last year. Total Sales Employees increased 17.2 percent to 31,071 as of March 31, 2009 versus March 31, 2008.
Second Quarter 2009 and Full Year 2009 Guidance
The company's second quarter 2009 diluted earnings per share guidance range is $0.69 to $0.73 (3) (4) (5) (6) on a volume point decline of 7 percent to 9 percent and a net sales decline of 14 percent to 16 percent compared to the same period in 2008, respectively, and an effective tax rate range of 31 percent to 32 percent (4). Assuming constant currency levels from the second quarter of 2008, the company's net sales growth range would be a decline of 2 percent to 4 percent and its diluted earnings per share range would be $1.00 to $1.04. Our second quarter 2009 capital expenditures are expected to be in the range of $15 to $20 million.
Despite the stronger than expected volume points and earnings in the first quarter, the company is maintaining a cautious outlook for 2009 volume point growth, assuming spot foreign currency rates as of April 20, 2009 for the balance of the year and a higher effective tax rate due to country mix. Therefore, the company is reiterating its full year diluted earnings per share guidance of $2.90 to $3.10 (3) (4) (5) (6) on volume point growth of zero to one percent and net sales decline of 7 percent to 9 percent compared to 2008, respectively, along with an effective tax rate range of 31 to 32 percent (4). Assuming constant currency levels from 2008, the company's net sales growth range would be 1 percent to 3 percent and its diluted earnings per share range would be $3.67 to $3.87. Full year 2009 capital expenditures are expected in the range of $55 million to $60 million.
First Quarter Earnings Conference Call
Herbalife's senior management team will host an investor conference call to discuss its first quarter 2009 financial results and provide an update on current business trends on Tuesday, May 5, at 8 a.m. PDT (11 a.m. EDT).
The dial-in number for this conference call for domestic callers is 866-219-5268 and 703-639-1120 for international callers. Live audio of the conference call will be simultaneously webcast in the Investor Relations section of the company's Web site at http://ir.herbalife.com.
An audio replay will be available following the completion of the conference call in MP3 format or by dialing 866-837-8032 (domestic callers) and 703-925-2474 (international callers) and entering access code 336024. The webcast of the teleconference will be archived and available on Herbalife's Web site. The webcast of the teleconference will be archived and available on Herbalife's Web site.
About Herbalife Ltd.
Herbalife Ltd., is a global network marketing company that sells weight-management, nutrition, and personal care products intended to support a healthy lifestyle. Herbalife products are sold in 70 countries through a network of over 1.9 million independent distributors. The company supports the Herbalife Family Foundation and its Casa Herbalife program to bring good nutrition to children. Please visit Herbalife Investor Relations for additional financial information.
Disclosure Regarding Forward-Looking Statements
Except for historical information contained herein, the matters set forth in this press release are "forward-looking statements." All statements other than statements of historical fact are "forward-looking statements" for purposes of federal and state securities laws, including any projections of earnings, revenue or other financial items; any statements of the plans, strategies and objectives of management for future operations; any statements concerning proposed new services or developments; any statements regarding future economic conditions or performance; any statements of belief; and any statements of assumptions underlying any of the foregoing. Forward-looking statements may include the words, "may," "will," "estimate," "intend," "continue," "believe," "expect," or "anticipate" and any other similar words.
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
distributors;
-- adverse publicity associated with our products or network marketing
organization;
-- uncertainties relating to interpretation and enforcement of recently
enacted 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, Chinese legal system or Chinese
governmental policies;
-- improper action by our employees or international distributors in
violation of applicable law;
-- changing consumer preferences and demands;
-- loss or departure of any member of our senior management team which
could negatively impact our distributor relations and operating results;
-- 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;
-- risks associated with operating internationally, including foreign
exchange and devaluation risks;
-- 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 on our management team;
-- uncertainties relating to the application of transfer pricing, duties,
value added taxes and other tax regulations, and changes thereto;
-- taxation relating to our distributors;
-- product liability claims;
-- any collateral impact resulting from the ongoing worldwide financial
"crisis", including the availability of liquidity to us, our customers
and our suppliers or the willingness of our customers to purchase
products in a recessionary economic environment; and
-- whether we will purchase any of our shares in the open markets or
otherwise.
1 See Schedule D - "Reconciliation of Non-GAAP Financial Measures" for more detail
2 See Schedule titled "New Sales Leaders by Region" and "Total Sales Leaders by Region" for more detail
3 Excludes the potential impact of expenses relating to the company's December 2008 restructuring
4 Excludes the potential impact of a second quarter tax settlement with a foreign government.
5 Excludes the accretion/dilution impact should the company elect to repurchase shares under its share repurchase program.
6 Excludes the potential impact of repatriating dollars from Venezuela at an exchange rate which differs from the official exchange rate
RESULTS OF OPERATIONS:
Herbalife Ltd.
Consolidated Statements of Income
(In thousands, except per share data)
(Unaudited)
Quarter Ended
3/31/2009 3/31/2008
North America $ 123,076 $ 118,591
Mexico 59,239 93,567
South America and Central America 75,264 106,072
EMEA 123,312 158,013
Asia Pacific 113,944 103,678
China 26,848 24,516
Worldwide net sales 521,683 604,437
Cost of Sales 102,400 117,666
Gross Profit 419,283 486,771
Royalty Overrides 175,532 212,720
SGA 181,458 184,400
Operating Income 62,293 89,651
Interest Expense - net 1,712 3,791
Income before income taxes 60,581 85,860
Income Taxes 19,039 23,493
Net Income 41,542 62,367
Basic Shares 61,510 64,381
Diluted Shares 61,614 67,200
Basic EPS $ 0.68 $ 0.97
Diluted EPS $ 0.67 $ 0.93
Dividends declared per share $ 0.20 $ 0.20
Herbalife Ltd.
Consolidated Balance Sheets
(In thousands)
(Unaudited)
Mar 31, Dec 31,
2009 2008
ASSETS
Current Assets:
Cash & cash equivalents $ 194,733 $ 150,847
Receivables 72,300 70,002
Inventory, net 115,705 134,392
Prepaid expenses 84,904 89,214
Deferred income taxes 39,921 40,313
Total Current Assets 507,563 484,768
Property and equipment, net 174,255 175,492
Deferred compensation plan assets 15,142 15,754
Deferred financing cost, net 1,868 1,989
Marketing related intangibles 310,060 310,060
Goodwill 110,677 110,677
Other assets 20,961 22,578
Total Assets $ 1,140,526 $ 1,121,318
LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities:
Accounts payable 29,853 41,084
Royalty Overrides 125,696 130,369
Accrued compensation 43,690 60,629
Accrued expenses 114,590 104,795
Current portion of long term debt 6,353 15,117
Advance sales deposits 28,903 12,603
Income taxes payable 44,052 37,302
Total Current Liabilities 393,137 401,899
Non-current liabilities
Long-term debt, net of current portion 339,126 336,514
Deferred compensation 13,773 13,979
Deferred income taxes 104,331 103,675
Other non-current liabilities 23,621 23,520
Total Liabilities 873,988 879,587
Contingencies
Shareholders' equity:
Common shares 123 123
Additional paid in capital 201,973 197,715
Accumulated other comprehensive loss (37,307 ) (28,614 )
Retained earnings 101,749 72,507
Total Shareholders' Equity 266,538 241,731
Total Liabilities and Shareholders' Equity $ 1,140,526 $ 1,121,318
Herbalife Ltd.
Consolidated Statements of Cash Flows
(In thousands)
(Unaudited)
Quarter Ended
3/31/2009 3/31/2008
CASH FLOWS FROM OPERATING ACTIVITIES
Net income $ 41,542 $ 62,367
Adjustments to reconcile net income to net cash
provided by operating activities:
Depreciation and amortization 14,821 10,371
Deficiency (Excess) tax benefits from share-based 963 (10,709 )
payment arrangements
Share based compensation expenses 4,880 5,133
Amortization of discount and deferred financing costs 121 118
Deferred income taxes 586 (92 )
Unrealized foreign exchange transaction loss 6,537 1,926
Other 919 556
Changes in operating assets and liabilities:
Receivables (4,047 ) (13,843 )
Inventories 12,235 7,734
Prepaid expenses and other current assets 979 (16,482 )
Other assets 750 (77 )
Accounts payable (9,566 ) (3,182 )
Royalty overrides (1,035 ) (4,156 )
Accrued expenses and accrued compensation (6,703 ) 4,965
Advance sales deposits 16,666 6,242
Income taxes payable 6,574 12,184
Deferred compensation plan liability (206 ) (255 )
NET CASH PROVIDED BY OPERATING ACTIVITIES 86,016 62,800
CASH FLOWS FROM INVESTING ACTIVITIES
Purchases of property (14,073 ) (23,931 )
Deferred compensation plan assets 612 330
NET CASH USED IN INVESTING ACTIVITIES (13,461 ) (23,601 )
CASH FLOWS FROM FINANCING ACTIVITIES
Dividends paid (12,300 ) (12,869 )
Borrowings from long-term debt 19,000 --
Principal payments on long-term debt (25,487 ) (32,099 )
Increase in deferred financing costs -- (75 )
Share repurchases -- (17,668 )
(Deficiency) Excess tax benefits from share-based (963 ) 10,709
payment arrangements
Proceeds from exercise of stock options and sale of 365 12,553
stock under employee stock purchase plan
NET CASH USED IN FINANCING ACTIVITIES (19,385 ) (39,449 )
EFFECT OF EXCHANGE RATE CHANGES ON CASH (9,284 ) 3,989
NET CHANGE IN CASH AND CASH EQUIVALENTS 43,886 3,739
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD 150,847 187,407
CASH AND CASH EQUIVALENTS, END OF PERIOD $ 194,733 $ 191,146
CASH PAID DURING THE PERIOD
Interest paid $ 3,429 $ 4,976
Income taxes paid $ 13,374 $ 11,411
NON CASH ACTIVITIES
Assets acquired under capital leases and other $ 280 $ 657
long-term debt
Herbalife Ltd.
New Sales Leaders by Region
(Unaudited)
Three Months Ended March 31,
2009 2008 % Change
North America 7,893 9,010 (12.4 )%
Mexico 4,351 7,355 (40.8 )%
South & Central America 7,715 12,780 (39.6 )%
EMEA 5,236 6,533 (19.9 )%
Asia Pacific (excluding China) 10,737 8,777 22.3 %
Total New Supervisors 35,932 44,455 (19.2 )%
New China Sales Employees 4,327 4,350 (0.5 )%
Worldwide Total New Sales Leaders (1) 40,259 48,805 (17.5 )%
Herbalife Ltd.
Total Sales Leaders by Region
(Unaudited)
Three Months Ended March 31,
2009 2008 % Change
North America 67,097 67,749 (1.0 )%
Mexico 52,136 63,309 (17.6 )%
South & Central America 70,532 71,893 (1.9 )%
EMEA 55,461 61,802 (10.3 )%
Asia Pacific (excluding China) 64,417 60,180 7.0 %
Total Supervisors 309,643 324,933 (4.7 )%
China Sales Employees 31,071 26,515 17.2 %
Worldwide Total Sales Leaders(1) 340,714 351,448 (3.1 )%
Note: (1) - We refer to supervisors who qualified in 69 countries under our traditional marketing plan plus China sales employees collectively as 'Sales Leaders.'
Herbalife Ltd.
Volume Points by Region
(Unaudited, In thousands)
Three Months Ended March 31,
2009 2008 % Change
North America 186,497 178,102 4.7 %
Mexico 120,390 148,091 (18.7 )%
South & Central America 102,574 118,877 (13.7 )%
EMEA 124,096 137,104 (9.5 )%
Asia Pacific (excluding China) 144,998 106,315 36.4 %
China 20,832 20,683 0.7 %
Worldwide 699,387 709,172 (1.4 )%
SUPPLEMENTAL INFORMATION
SCHEDULE A: FINANCIAL GUIDANCE
2009 Guidance
For the Three Months Ending June 30, 2009 and Twelve Months Ending
December 31, 2009
Three Months Ending Twelve Months Ending
June 30, 2009 December 31, 2009
Low High Low High
Volume point growth vs. 2009 (9 %) (7 %) 0 % 1 %
Net sales growth vs. 2009 (16 %) (14 %) (9 %) (7 %)
EPS (1) (2) (3) (4) $ 0.69 $ 0.73 $ 2.90 $ 3.10
Cap Ex ($ millions) $ 15.0 $ 20.0 $ 55.0 $ 60.0
Effective Tax Rate (2) 31.0 % 32.0 % 31.0 % 32.0 %
(1) Excludes the potential impact of expenses relating to the company's
December 2008 restructuring.
(2) Excludes the potential impact of a second quarter tax settlement
with a foreign government.
(3) Excludes any accretion/dilution impact should the company elect to
repurchase shares under its share repurchase program.
(4) Excludes the potential impact of repatriating dollars from Venezuela
at an exchange rate that differs from the official exchange rate.
SCHEDULE B: NET SALES OF TOP 10 COUNTRIES
(In Millions)
Q1 2009 Q1 2008
Currency FX Benefit Currency FX
Reported (Loss) Reported Benefit
Adjusted Adjusted (Loss)
1 USA $ 119.1 $ 119.1 $ 0.0 1 USA $ 114.0 $ 114.0 $ 0.0
2 Mexico $ 59.2 $ 78.7 ($19.5 ) 2 Mexico $ 93.6 $ 91.8 $ 1.8
3 Taiwan $ 43.0 $ 46.8 ($3.8 ) 3 Brazil $ 35.7 $ 29.4 $ 6.3
4 Brazil $ 32.9 $ 43.9 ($11.0 ) 4 Taiwan $ 30.3 $ 29.1 $ 1.2
5 Italy $ 27.6 $ 31.8 ($4.2 ) 5 Italy $ 28.8 $ 25.2 $ 3.6
6 China $ 26.8 $ 25.7 $ 1.1 6 Venezuela $ 25.0 $ 25.0 $ 0.0
7 Venezuela $ 17.3 $ 17.3 $ 0.0 7 China $ 24.5 $ 22.6 $ 1.9
8 Korea $ 17.1 $ 25.3 ($8.2 ) 8 Japan $ 21.4 $ 18.8 $ 2.6
9 Japan $ 15.4 $ 17.6 ($2.2 ) 9 Spain $ 16.9 $ 14.8 $ 2.1
10 Malaysia $ 11.4 $ 12.8 ($1.4 ) 10 Korea $ 16.2 $ 16.5 ($0.3 )
Total of Top $ 369.8 $ 419.0 ($49.2 ) Total of Top $ 406.4 $ 387.2 $ 19.2
10 10
TOTAL NET $ 521.7 $ 598.9 ($77.2 ) TOTAL NET $ 604.4 $ 568.1 $ 36.3
SALES SALES
Note: Currency adjusted net sales use the prior year foreign currency rates to adjust
current year reported net sales figures.
SCHEDULE C: VOLUME POINTS FOR TOP 10 COUNTRIES
(In Millions)
Q1 2009 Q1 2008
1 USA 180 .4 1 USA 171 .4
2 Mexico 120 .4 2 Mexico 148 .1
3 Taiwan 58 .7 3 Brazil 39 .5
4 Brazil 44 .9 4 Taiwan 36 .4
5 Korea 26 .3 5 Venezuela 23 .8
6 Italy 24 .5 6 Italy 22 .4
7 China 20 .8 7 China 20 .7
8 Venezuela 14 .1 8 Korea 16 .7
9 Malaysia 13 .5 9 Japan 15 .4
10 Russia 11 .7 10 Spain 13 .6
Total of Top 10 515 .3 Total of Top 10 508 .0
TOTAL VOLUME POINTS 699 .4 TOTAL VOLUME POINTS 709 .2
SCHEDULE D: RECONCILIATION OF NON-GAAP FINANCIAL MEASURES
(Unaudited)
(Dollars in Thousands, Except Per Share Data)
In addition to its reported results, the Company has included in the tables below adjusted results 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 results, can provide useful supplemental information for investors analyzing period to period comparisons of the Company's results.
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
3/31/2009 3/31/2008
Net income, as reported $ 41,542 $ 62,367
Restructuring Expenses associated with realignment for 405 -
growth initiative (1)
Net income, as adjusted $ 41,947 $ 62,367
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
3/31/2009 3/31/2008
Diluted earnings per share, as reported $0.67 $0.93
Restructuring Expenses associated with realignment for 0.01 -
growth initiative (1)
Diluted earnings per share, as adjusted $0.68 $0.93
The following is a reconciliation of total long-term debt to net debt:
3/31/2009 12/31/2008
Total long-term debt (current and long-term portion) $ 345,479 $ 351,631
Less: Cash and cash equivalents 194,733 150,847
Net debt $ 150,746 $ 200,784
The restructuring charge adjustments reflect items that although they, or
(1) similar items might recur, are of a nature and magnitude that identifying
them separately provides investors with a greater ability to project the
Company's future performance.
Source: Herbalife Ltd.
Released May 4, 2009 • 4:05pm EDT