Herbalife Ltd. Annual report pursuant to Section 13 and 15(d)

Annual report pursuant to Section 13 and 15(d)

Segment Information (Tables)

Segment Information (Tables)

12 Months Ended

Dec. 31, 2024

Schedule of Segment Reporting Information by Segment, Sales by Product Line, and Sales by Geographic Area

Operating information for the two reportable segments, sales by product line, and sales by geographic area are as follows:


	Year Ended December 31,
	2024			2023			2022
	(in millions)
Net sales:
Primary Reporting Segment	$	4,695.5		$	4,735.0		$	4,813.4
China		297.6			327.4			391.0
Total net sales	$	4,993.1		$	5,062.4		$	5,204.4
Significant segment expenses
Cost of Sales (4)(5):
Primary Reporting Segment	$	1,060.9		$	1,141.0		$	1,121.2
China		43.4			50.0			52.4
Total cost of sales	$	1,104.3		$	1,191.0		$	1,173.6
Royalty Overrides and service fees to China independent service providers(1)(3)(4)(5):
Primary Reporting Segment	$	1,630.3		$	1,656.2		$	1,686.9
China		152.5			168.0			199.4
Total royalty overrides and service fees to China independent service providers	$	1,782.8		$	1,824.2		$	1,886.3
Contribution margin(1)(3):
Primary Reporting Segment	$	2,004.3		$	1,937.8		$	2,005.3
China		101.7			109.4			139.2
Total contribution margin	$	2,106.0		$	2,047.2		$	2,144.5
Selling, general, and administrative expenses excluding service fees to China independent service providers(1)(2)(3)		1,725.6			1,701.0			1,614.2
Other operating income		(5.5	)		(10.2	)		(14.9	)
Interest expense		218.3			165.9			139.3
Interest income		12.3			11.5			6.1
Other expense (income), net		10.5			(1.0	)		(12.8	)
Income before income taxes		169.4			203.0			424.8
Income taxes		(84.9	)		60.8			103.5
Net income	$	254.3		$	142.2		$	321.3
Net sales by product line:
Weight Management	$	2,768.1		$	2,851.7		$	2,954.2
Targeted Nutrition		1,484.3			1,480.0			1,512.7
Energy, Sports, and Fitness		572.2			560.3			550.6
Outer Nutrition		83.6			82.5			85.8
Literature, Promotional, and Other		84.9			87.9			101.1
Total net sales	$	4,993.1		$	5,062.4		$	5,204.4
Net sales by geographic area:
United States	$	1,026.0		$	1,100.5		$	1,225.5
China		297.6			327.4			391.0
India		844.8			796.6			677.1
Mexico		538.6			525.0			474.6
Others		2,286.1			2,312.9			2,436.2
Total net sales	$	4,993.1		$	5,062.4		$	5,204.4

(1)

Contribution margin consists of net sales less cost of sales, Royalty overrides, and service fees to our independent service providers in China. For the China segment, contribution margin includes the portion of service fees to China independent service providers that are currently recorded in selling, general, and administrative expenses within the Company's accompanying consolidated statements of income, which totaled $149.8 million, $165.0 million, and $196.2 million for the years ended December 31, 2024, 2023, and 2022, respectively.

(2)

Selling, general, and administrative expenses exclude the portion of service fees to China independent service providers that are included in selling, general, and administrative expenses within the Company's accompanying consolidated statements of income as described in footnote (1) above.

(3)

In the second quarter of 2024, the Company, as part of its restructuring initiatives, which are described further in Note 14, Restructuring Activities, changed its contribution margin presentation for its China segment which now includes expenses related to service fees to the Company's independent service providers in China as described in the footnotes immediately above. Historically, the China contribution margin did not include the portion of service fees that are recognized in selling, general and administrative expenses in the Company’s accompanying consolidated statements of income. Historical information presented in the table above has been reclassified to conform with the current period contribution margin presentation. This change had no impact on the Company's accompanying consolidated statements of income and only impacts this segment note presentation.

(4)

The significant expense categories and amounts align with the segment-level information that is regularly provided to the CODM.

(5)

As a result of adopting ASU 2023-07 during the fourth quarter of 2024, the Company has expanded and updated its disclosures for the current year and prior year periods as further described in Note 2, Basis of Presentation.

Schedule of Property, Plant and Equipment and Deferred Income Tax Assets by Geographic Area

The following table sets forth property, plant, and equipment and deferred income tax assets by geographic area:


	December 31,
	2024		2023		2022
	(in millions)
Property, plant, and equipment, net:
United States	$	409.9	$	437.6	$	399.9
Foreign		50.3		68.9		86.4
Total property, plant, and equipment, net	$	460.2	$	506.5	$	486.3
Deferred income tax assets:
United States	$	273.2	$	209.1	$	170.0
Foreign		228.6		78.7		73.2
Total deferred income tax assets	$	501.8	$	287.8	$	243.2