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

Quarterly report pursuant to Section 13 or 15(d)

Shareholders' (Deficit) Equity (Tables)

Shareholders' (Deficit) Equity (Tables)

9 Months Ended

Sep. 30, 2014

Summary of Changes in Shareholders' (Deficit) Equity

Changes in shareholders’ (deficit) equity for the nine months ended September 30, 2014 were as follows (in thousands):


Total shareholders’ equity as of December 31, 2013	$	551,446
Net income		205,408
Issuance of common shares from exercise of stock options, SARs, restricted stock grants, and employee stock purchase plan		2,401
Excess tax benefit from exercise of stock options, SARs and restricted stock grants		4,176
Additional capital from share-based compensation		34,431
Repurchases of common shares, including Forward Transactions		(1,278,420	)
Allocation to additional paid-in capital due to issuance of the Convertible Notes and Forward Transactions.		249,797
Reduction in additional paid-in capital from the Capped Call Transactions		(123,825	)
Dividends paid and received, net		(26,984	)
Foreign currency translation adjustment, net of income taxes		(39,717	)
Unrealized gain on derivatives, net of income taxes		821
Unrealized loss on available-for-sale investments, net of income taxes		(95	)

Total shareholders’ deficit as of September 30, 2014	$	(420,561	)

Summary of Changes in Accumulated Other Comprehensive Income (Loss)

The following table summarizes changes in accumulated other comprehensive income (loss) during the three months ended September 30, 2014 and 2013:


	Changes in Accumulated Other Comprehensive Income (Loss) by Component Three Months Ended September 30,
	2014												2013
	Foreign Currency Translation Adjustments			Unrealized Gain (Loss) on Derivatives			Unrealized Gain (Loss) on Available-For- Sale Investments			Total			Foreign Currency Translation Adjustments			Unrealized Gain (Loss) on Derivatives		Unrealized Gain (Loss) on Available-For- Sale Investments		Total
	(In millions)
Beginning Balance	$	(25.4	)	$	2.5		$	0.2		$	(22.7	)	$	(46.7	)	$	2.4		—	$	(44.3	)

Other comprehensive income (loss) before reclassifications, net of tax		(39.9	)		5.7			(4.6	)		(38.8	)		15.0			0.5		—		15.5
Amounts reclassified from accumulated other comprehensive income (loss) to income, net of tax(1)		—			(1.7	)		4.4			2.7			—			1.4		—		1.4

Total other comprehensive income (loss), net of reclassifications		(39.9	)		4.0			(0.2	)		(36.1	)		15.0			1.9		—		16.9

Ending balance	$	(65.3	)	$	6.5		$	—		$	(58.8	)	$	(31.7	)	$	4.3		—	$	(27.4	)

(1)

See Note 2, Significant Accounting Policies, and Note 9, Derivative Instruments and Hedging Activities, for information regarding the location in the condensed consolidated statements of income of gains (losses) reclassified from accumulated other comprehensive income (loss) into income during the three and nine months ended September 30, 2014.

The following table summarizes changes in accumulated other comprehensive income (loss) during the nine months ended September 30, 2014 and 2013:


	Changes in Accumulated Other Comprehensive Income (Loss) by Component Nine Months Ended September 30,
	2014												2013
	Foreign Currency Translation Adjustments			Unrealized Gain (Loss) on Derivatives			Unrealized Gain (Loss) on Available-For- Sale Investments			Total			Foreign Currency Translation Adjustments			Unrealized Gain (Loss) on Derivatives			Unrealized Gain (Loss) on Available-For- Sale Investments		Total
	(In millions)
Beginning Balance	$	(25.6	)	$	5.7		$	0.1		$	(19.8	)	$	(28.8	)	$	(2.9	)		—	$	(31.7	)

Other comprehensive income (loss) before reclassifications, net of tax		(39.7	)		4.0			(6.5	)		(42.2	)		(2.9	)		2.5			—		(0.4	)
Amounts reclassified from accumulated other comprehensive income (loss) to income, net of tax(1)		—			(3.2	)		6.4			3.2			—			4.7			—		4.7

Total other comprehensive income (loss), net of reclassifications		(39.7	)		0.8			(0.1	)		(39.0	)		(2.9	)		7.2			—		4.3

Ending balance	$	(65.3	)	$	6.5		$	—		$	(58.8	)	$	(31.7	)	$	4.3			—	$	(27.4	)

(1)