Herbalife Reports Year-Over-Year Net Sales Growth in Fourth Quarter 2023

Core Insights - Herbalife Ltd. reported financial results for Q4 and full-year 2023, focusing on top-line growth and margin expansion for 2024 [1] Financial Performance Fourth Quarter 2023 - Net sales reached $1.2 billion, a year-over-year increase of 2.9% and 2.5% on a constant currency basis [2][5] - Net income was $10.2 million, with adjusted EBITDA of $108.8 million [2][6] - Diluted EPS was $0.10, while adjusted diluted EPS was $0.28 [2][6] - Cost savings of approximately $27 million were achieved in Q4, contributing to a total of about $70 million for the year [2][7] - Gross profit margin was 76.3%, down 120 basis points year-over-year due to input cost inflation [6] Full-Year 2023 - Total net sales were $5.1 billion, a decline of 2.7% compared to 2022, with a 1.6% decline on a constant currency basis [3][5] - Net income for the year was $142.2 million, with adjusted EBITDA of $570.6 million [3][5] - Diluted EPS was $1.42, and adjusted diluted EPS was $2.21 [3][5] - Net cash provided by operating activities was $357.5 million, with free cash flow of $222.5 million [3][5] Recent Developments - The company initiated a refinancing process for its 2018 Term Loan A and Revolving Credit Facility, maturing in March 2025 [4][8] - The rollout of the new Herbalife.com website is ongoing, now live in markets representing approximately 70% of the company's sales [9] - The company launched four innovative products aimed at aligning with consumer trends in December 2023 and January 2024 [11] Transformation Program - The Transformation Program, initiated in 2021, has delivered approximately $70 million in cost savings for 2023, with expectations of at least $115 million in savings for 2024 and beyond [7][9] - Pre-tax expenses related to the program were approximately $12 million in Q4 and $54 million for the full year [7][9] Regional Performance Fourth Quarter 2023 - Asia Pacific reported net sales of $433.5 million, up 9.3% year-over-year [14] - North America saw a decline in net sales of 8.1%, totaling $252.8 million [14] - EMEA reported a slight increase of 1.3% in net sales, totaling $250.1 million [14] - Latin America experienced a 2.8% increase, with net sales of $196.4 million [14] - China reported a significant increase of 15.6%, totaling $82.2 million [14] Full-Year 2023 - Asia Pacific net sales were $1.7 billion, up 1.6% [12] - North America net sales decreased by 10.4% to $1.1 billion [12] - EMEA net sales were $1.1 billion, down 0.9% [12] - Latin America reported $820.9 million in net sales, up 4.5% [12] - China saw a decline of 16.3%, totaling $327.4 million [12]