Herbalife(HLF) - 2024 Q4 - Annual Results

Financial Performance - Q4 2024 net sales were $1.2 billion, down 0.6% year-over-year, but up 2.7% on a constant currency basis[5]. - Full-year 2024 net sales totaled $5.0 billion, a decrease of 1.4% year-over-year, with a 1.2% increase on a constant currency basis[10]. - Adjusted EBITDA for Q4 2024 was $150.0 million, exceeding guidance, with an adjusted EBITDA margin of 12.4%, up 340 basis points from Q4 2023[8]. - Full-year 2024 adjusted EBITDA reached $634.8 million, with an adjusted EBITDA margin of 12.7%, up 140 basis points compared to 2023[10]. - Net income for Q4 2024 was $177.9 million, significantly up from $10.2 million in Q4 2023, representing a year-over-year increase of 1,642.2%[39]. - Net income for the year ended December 31, 2024, increased to $254.3 million, up from $142.2 million in 2023, representing a growth of 78.9%[44]. - Adjusted net income for Q4 2024 was $36.8 million, compared to $28.6 million in Q4 2023, with full-year adjusted net income at $198.9 million, down from $221.8 million[51]. - EBITDA for the year ended December 31, 2024, was $496.8 million, compared to $470.7 million in 2023, indicating a year-over-year growth[51]. - Adjusted EBITDA for the year was $634.8 million, up from $570.6 million in 2023, reflecting a strong operational performance[52]. - The adjusted EBITDA margin for 2024 was 12.7%, compared to 11.3% in 2023, showcasing improved profitability[52]. Sales and Guidance - First quarter 2025 net sales guidance is projected to decline between 5.5% to 1.5% year-over-year[24]. - Full-year 2025 net sales guidance is expected to range from a decline of 3% to an increase of 3% year-over-year[25]. - The company reported a net sales figure of $4,993.1 million for 2024, a decrease from $5,062.4 million in 2023[51]. Cost Management and Restructuring - The company expects annual savings of at least $80 million from its Restructuring Program starting in 2025[12]. - The company incurred $69.1 million in restructuring program expenses for the year, compared to none in the previous year, indicating ongoing transformation efforts[51]. - Capital expenditures for full-year 2024 were $122.0 million, with guidance for 2025 set between $100 million and $130 million[11][25]. Debt and Financial Position - The company redeemed $65.0 million of its 7.875% Senior Notes due 2025, reducing the outstanding principal balance to $197.3 million[13]. - Total debt as of the end of 2024 was $2,332.7 million, down from $2,581.1 million in 2023, reflecting effective debt management[52]. - Principal payments on debt rose to $1,937.0 million in 2024 from $289.6 million in 2023, indicating a substantial increase in debt repayment activity[44]. - The leverage ratio under the Credit Agreement improved to 3.2x in 2024 from 3.9x in 2023, indicating a stronger balance sheet[52]. Assets and Liabilities - Total assets decreased to $2,728.1 million in 2024 from $2,809.4 million in 2023, a decline of 2.9%[42]. - Total liabilities decreased to $3,529.2 million in 2024 from $3,869.7 million in 2023, a reduction of 8.8%[42]. - The company reported a decrease in cash and cash equivalents to $415.3 million in 2024 from $575.2 million in 2023, a decline of 27.8%[42]. - Cash, cash equivalents, and restricted cash at the end of the period was $438.1 million, down from $595.5 million at the end of 2023, a decrease of 26.5%[44]. Market Strategy and Outlook - The company plans to continue focusing on expanding its market presence and enhancing its product offerings in 2025[33]. - The outlook for 2025 does not account for potential impacts from incremental tariffs, indicating a cautious approach to future projections[29]. - The company aims to improve its operational efficiency and strengthen its supply chain management to mitigate risks associated with global economic conditions[35]. - The company plans to continue focusing on international operations, which are expected to contribute significantly to total net sales[49]. Currency Impact - The company emphasized the impact of currency fluctuations on total net sales, which are significantly affected by the U.S. dollar against foreign currencies[49]. - The company experienced a foreign exchange transaction loss of $7.6 million in 2024, compared to a loss of $6.0 million in 2023[44].