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

Segment Information (Tables)

9 Months Ended

Sep. 30, 2011


	Three Months Ended				Nine Months Ended
	September 30,		September 30,		September 30,		September 30,
	2011		2010		2011		2010
	(In millions)
Net Sales:
Primary Reporting Segment
United States	$	175.1	$	150.6	$	516.7	$	458.9
Mexico		112.9		83.5		330.7		236.3
Others		552.2		402.7		1,570.5		1,165.5

Total Primary Reporting Segment		840.2		636.8		2,417.9		1,860.7
China		55.0		51.6		152.1		135.2

Total Net Sales	$	895.2	$	688.4	$	2,570.0	$	1,995.9


Contribution Margin(1)(2):
Primary Reporting Segment
United States	$	79.2	$	64.9	$	225.3	$	196.0
Mexico		48.1		36.4		139.5		93.5
Others		252.5		183.9		717.0		517.4

Total Primary Reporting Segment		379.8		285.2		1,081.8		806.9
China		49.2		46.0		134.6		122.5

Total Contribution Margin	$	429.0	$	331.2	$	1,216.4	$	929.4

Selling, general and administrative expenses		277.7		230.2		788.5		648.1
Interest expense, net		0.3		2.2		3.8		6.3

Income before income taxes		151.0		98.8		424.1		275.0
Income taxes		43.0		19.9		116.9		62.1

Net Income	$	108.0	$	78.9	$	307.2	$	212.9


(1)		Contribution margin consists of net sales less cost of sales and royalty overrides. See Part I, Item 2 — Management’s Discussion and Analysis of Financial Condition and Results of Operations in this Quarterly Report on Form 10-Q for a description of net sales, cost of sales and royalty overrides.

(2)		Compensation to China sales employees and service fees to China independent service providers totaling $25.2 million and $24.0 million for the three months ended September 30, 2011 and 2010, respectively, and $70.7 million and $64.4 million for the nine months ended September 30, 2011 and 2010, respectively, is included in selling, general and administrative expenses while distributor compensation for all other countries is included in contribution margin.


Net sales by product line:
Weight Management	$	560.1	$	428.1	$	1,611.0	$	1,245.8
Targeted Nutrition		205.3		160.4		582.8		458.9
Energy, Sports and Fitness		45.7		31.9		124.6		87.8
Outer Nutrition		35.4		30.2		109.0		92.2
Literature, promotional and other(3)		48.7		37.8		142.6		111.2

Total Net Sales	$	895.2	$	688.4	$	2,570.0	$	1,995.9


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


Net sales by geographic region:
North America	$	180.7	$	155.5	$	532.9	$	473.2
Mexico		112.9		83.5		330.7		236.3
South and Central America		143.7		95.0		399.1		269.2
EMEA		147.7		121.2		463.6		387.6
Asia Pacific		255.2		181.6		691.6		494.4
China		55.0		51.6		152.1		135.2

Total Net Sales	$	895.2	$	688.4	$	2,570.0	$	1,995.9