Herbalife Ltd. Announces Record Fourth Quarter 2012 And Record Full Year Results, And Raises 2013 Earnings Guidance

Herbalife Ltd. (NYSE: HLF) today reported fourth quarter net sales of $1.1 billion, reflecting an increase of 20 percent compared to the same time period in 2011 on volume point growth of 18 percent. Net income for the quarter of $117.8 million, or $1.05 per diluted share, compares to 2011 fourth quarter net income of $105.4 million and EPS of $0.86, respectively.

For the twelve months ended December 31, 2012, the company reported record net sales of $4.1 billion, an 18 percent increase on 20 percent growth in volume compared to 2011. For the same period, the company reported net income of $477.2 million, or $4.05 per diluted share, reflecting an increase of 16 percent and 23 percent, respectively, compared to the 2011 results of $412.6 million and $3.30 per diluted share.

“Herbalife continues to deliver record results in sales and profitability as our independent distributors go deeper into existing markets, developing more and more customers using our nutrition products every day,” said Michael O. Johnson, Herbalife’s chairman and CEO. “Obesity and poor nutrition are global public health problems. Our distributors are proud to be part of the solution.”

For the year ended December 31, 2012 the company generated cash flow from operations of $567.8 million, an increase of 11 percent compared to 2011; paid dividends of $135.1 million; invested $122.8 million in capital expenditures; and repurchased $527.8 million in common shares outstanding under our share repurchase program.

Fourth Quarter and Fiscal 2012 Regional Key Metrics ^1,2

Regional Volume Point and Average Active Sales Leader Metrics

	Volume Points (Mil)				Average Active Sales Leaders
Region	4Q'12		Yr/Yr % Chg		4Q'12		Yr/Yr % Chg
North America	267.0		15%		68,029		14%
Asia Pacific	304.6		18%		69,553		26%
EMEA	156.6		14%		47,226		14%
Mexico	208.9		13%		61,836		19%
South & Central America	222.5		34%		50,874		28%
China	50.5		17%		12,560		25%
Worldwide Total	1,210.1		18%		300,521		20%

	Volume Points (Mil)				Average Active Sales Leaders
Region	FY'12		Yr/Yr % Chg		FY'12		Yr/Yr % Chg
North America	1,157.8		17%		66,054		16%
Asia Pacific	1,197.8		25%		63,255		31%
EMEA	602.5		11%		44,098		14%
Mexico	815.4		16%		57,651		21%
South & Central America	740.4		30%		44,980		29%
China	206.5		34%		11,683		33%
Worldwide Total	4,720.4		20%		277,803		22%

2012 Annual Sales Leader Requalification

By the end of January of each year, sales leaders are required to re-qualify to retain their sales leader status. A record number of sales leaders were retained in 2012. The overall pool of sales leaders needing to re-qualify increased by approximately 21% compared to the prior year and we retained 20% more of them than in the prior year. While size of the group needing to re-qualify increased for the year, our overall retention rate remained fairly constant at 51.8%.

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