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, 2015

Reconciliation of Revenue from Segments to Consolidated

	Three Months Ended				Six Months Ended
	June 30, 2015		June 30, 2014		June 30, 2015		June 30, 2014
	(In millions)
Net Sales:
Primary Reporting Segment
United States	$	224.9	$	245.0	$	446.8	$	487.3
Mexico		129.2		148.6		252.8		291.3
South Korea		77.3		117.9		149.1		216.9
Others		494.2		624.6		1,018.1		1,267.4
Total Primary Reporting Segment		925.6		1,136.1		1,866.8		2,262.9
China		236.7		170.1		400.9		305.9
Total Net Sales	$	1,162.3	$	1,306.2	$	2,267.7	$	2,568.8

Reconciliation of Operating Profit (Loss) from Segments to Consolidated

Contribution Margin(1)(2):
Primary Reporting Segment
United States	$	88.4	$	101.9	$	180.6	$	205.8
Mexico		53.7		64.1		112.4		125.5
South Korea		43.2		62.9		84.8		118.3
Others		214.5		277.0		441.0		561.7
Total Primary Reporting Segment		399.8		505.9		818.8		1,011.3
China		214.5		152.3		362.5		276.7
Total Contribution Margin	$	614.3	$	658.2	$	1,181.3	$	1,288.0
Selling, general and administrative expenses(2)		470.5		461.9		901.9		964.0
Interest expense, net		23.7		21.4		45.2		36.4
Other expense, net		—		—		2.3		3.2
Income before income taxes		120.1		174.9		231.9		284.4
Income taxes		37.3		55.4		70.9		90.2
Net Income	$	82.8	$	119.5	$	161.0	$	194.2

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

(2)

Service fees to China independent service providers totaling $114.4 million and $80.8 million for the three months ended June 30, 2015 and 2014, respectively, and totaling $193.1 million and $142.5 million for the six months ended June 30, 2015 and 2014, 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	$	752.1	$	843.5	$	1,456.0	$	1,651.1
Targeted Nutrition		261.0		286.1		512.9		570.1
Energy, Sports and Fitness		62.6		68.9		122.7		135.6
Outer Nutrition		32.0		47.0		67.4		86.7
Literature, promotional and other(3)		54.6		60.7		108.7		125.3
Total Net Sales	$	1,162.3	$	1,306.2	$	2,267.7	$	2,568.8

(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	$	230.0	$	250.6	$	456.7	$	498.4
Mexico		129.2		148.6		252.8		291.3
South and Central America		133.5		203.3		295.2		448.0
EMEA		193.8		227.3		380.2		438.5
Asia Pacific		239.1		306.3		481.9		586.7
China		236.7		170.1		400.9		305.9
Total Net Sales	$	1,162.3	$	1,306.2	$	2,267.7	$	2,568.8