Herbalife Ltd. Announces Record Second Quarter 2012 And Raises 2012 Earnings Guidance

Herbalife Ltd. (NYSE: HLF) today reported second quarter record net sales of $1.0 billion, a 17 percent increase, driven by a 23 percent increase in volume points compared to the prior year period. The company reported net income of $133.4 million, or $1.10 per diluted share, compared to the second quarter 2011 net income of $111.2 million, or $0.88 per diluted share, reflecting an increase of 20 percent and 25 percent, respectively.

“The broad strength of our business success continued throughout the second quarter with strong sales performance from each of our six regions, along with record earnings and strong cash flow,” said Michael O. Johnson, the company’s chairman and CEO. “We believe the underlying drivers of our current business success, engaged distributors focused on globalizing daily consumption sales methods and products which are relevant for today’s global macro trends of obesity and an aging population, will continue to provide the catalyst for future growth.”

For the quarter ended June 30, 2012, the company generated cash flow from operations of $137.1 million, paid dividends of $35.1 million, invested $15.0 million in capital expenditures and repurchased $239.0 million in common shares outstanding under our share repurchase program. As of July 27, 2012 the company has completed the $427.9 million repurchase agreement announced on May 3, 2012. The company repurchased a total of 9.2 million shares at an average price of $46.37.

Second Quarter Regional Key Metrics 1,2

Regional Volume Point and Average Active Sales Leader Metrics
          Volume Points (Mil)         Average Active Sales Leaders
Region           2Q'12         Yr/Yr % Chg         2Q'12         Yr/Yr % Chg
North America 305.0         18 % 65,828         18 %
Asia Pacific 313.8 29 % 61,329 35 %
EMEA 154.5 13 % 42,972 14 %
Mexico 203.9 17 % 55,969 21 %
South & Central America 167.2 30 % 41,966 27 %
China           57.7         54 %         11,949         43 %
Worldwide Total           1,202.1         23 %         269,974         24 %
 

Updated 2012 Guidance

Guidance for fully diluted 2012 EPS is based on the average daily exchange rates of the first two weeks of July 2012.

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