Herbalife Ltd. Quarterly report pursuant to Section 13 or 15(d)

Quarterly report pursuant to Section 13 or 15(d)

Segment Information (Tables)

Segment Information (Tables)

6 Months Ended

Jun. 30, 2014

Reconciliation of Revenue from Segments to Consolidated


	Three Months Ended				Six Months Ended
	June 30, 2014		June 30, 2013		June 30, 2014		June 30, 2013
	(In millions)
Net Sales:
Primary Reporting Segment
United States	$	245.0	$	241.7	$	487.3	$	457.9
Mexico		148.6		145.6		291.3		278.5
South Korea		117.9		112.0		216.9		222.0
Others		624.6		601.9		1,267.4		1,197.9

Total Primary Reporting Segment		1,136.1		1,101.2		2,262.9		2,156.3
China		170.1		118.0		305.9		186.6

Total Net Sales	$	1,306.2	$	1,219.2	$	2,568.8	$	2,342.9

Reconciliation of Operating Profit (Loss) from Segments to Consolidated

Contribution Margin(1)(2):
Primary Reporting Segment
United States	$	101.9	$	99.5	$	205.8	$	194.2
Mexico		64.1		64.0		125.5		122.6
South Korea		62.9		56.4		118.3		111.6
Others		277.0		266.8		561.7		531.3

Total Primary Reporting Segment		505.9		486.7		1,011.3		959.7
China		152.3		105.8		276.7		166.3

Total Contribution Margin	$	658.2	$	592.5	$	1,288.0	$	1,126.0

Selling, general and administrative expenses(2)		461.9		400.1		964.0		764.8
Interest expense, net		21.4		5.6		36.4		10.9
Other expense, net		—		—		3.2		—

Income before income taxes		174.9		186.8		284.4		350.3
Income taxes		55.4		43.6		90.2		88.3

Net Income	$	119.5	$	143.2	$	194.2	$	262.0

(1)	Contribution margin consists of net sales less cost of sales and royalty overrides.

(2)

Service fees to China independent service providers totaling $80.8 million and $53.2 million for the three months ended June 30, 2014 and 2013, respectively, and totaling $142.5 million and $84.7 million for the six months ended June 30, 2014 and 2013, respectively, are included in selling, general and administrative expenses while Member compensation for all other countries is included in contribution margin.

Schedule of Entity-Wide Information, Revenue from External Customers by Products and Services

Net sales by product line:
Weight Management		843.5	$	778.2	$	1,651.1	$	1,489.8
Targeted Nutrition		286.1		277.5		570.1		534.4
Energy, Sports and Fitness		68.9		65.1		135.6		123.4
Outer Nutrition		47.0		37.8		86.7		76.0
Literature, promotional and other(3)		60.7		60.6		125.3		119.3

Total Net Sales	$	1,306.2	$	1,219.2	$	2,568.8	$	2,342.9

(3)	Product buybacks and returns in all product categories are included in the literature, promotional and other category.

Schedule of Revenue from External Customers Attributed to Foreign Countries by Geographic Area

Net sales by geographic region:
North America		250.6	$	247.5	$	498.4	$	469.0
Mexico		148.6		145.6		291.3		278.5
South and Central America		203.3		222.5		448.0		441.9
EMEA		227.3		186.4		438.5		355.9
Asia Pacific		306.3		299.2		586.7		611.0
China		170.1		118.0		305.9		186.6

Total Net Sales	$	1,306.2	$	1,219.2	$	2,568.8	$	2,342.9