Herbalife (HLF), a global nutrition company, has announced a 16.51 percent decline in profit for the quarter ended Jun. 30, 2014. The company earned $119.53 million or $1.31 a share in the second-quarter compared with $143.16 million or $1.34 a share a year ago.

Adjusted earnings per share came in at $1.55 a share, when analysts expected $1.57 a share.

Revenue during the second-quarter climbed 7.13 percent to $1306.20 million from $1219.24 million in the last year period.

Gross margin expanded by 58 basis points over the last year period to 80.31 percent. Total expenses as a percentage of revenues increased to 84.97 percent from 84.22 percent in the same period last year. That has resulted in contraction of 75 basis points in operating margins to 15.03 percent.

The company reported operating income of $196.29 million, compared with $192.36 million in the previous year period.

For full-year, the company expects revenue growth to be in the range of 8.5 to 10.5 percent. It has raised adjusted earnings per share guidance to $6.17-$6.32 for full-year.

The company expects the third quarter revenue growth to be in the range of to 9 to 11 percent. It anticipates adjusted earnings per share at $1.49 - $1.53 for the third quarter.

Cash Flow

Herbalife has generated cash of $347.58 million from operating activities during the first half, down 1.10 percent or $3.87 million when compared with the last year period. The company has generated 13.53 cents of operating cash flow in every sales dollar for the first half, down from 15 cents in the same period last year.

The company has spent $113.06 million cash to meet investing activities during the first half, as against cash outgo of $56.02 million in the last year period. It has made net capital expenditure of $105.47 million during the first half, which was higher by 88.29 percent or $49.46 million, from a year ago.

The company's free cash flow accounted for 69.66 percent of operating cash flow for the first half, compared with 84.06 percent in the last year period.

The company has spent $336.43 million from financing activities during the first half, as against cash inflow of $248.41 million in the last year period. It has borrowed net of $1112.50 million through debt during the first half. It has spent net of $1275.89 million on repurchase of common stocks.

The company's cash dividend payment decreased 50.83 percent or $31.42 million to $30.40 million.

As on Jun. 30, 2014, the company's cash balance stood at $773.52 million, down 8.97 percent or $76.19 million from Jun. 30, 2013.

Working Capital

Herbalife has witnessed a decline in the working capital over the last one year. The company's working capital stood at $552.42 million as at Jun. 30, 2014, down $159.29 million or 22.38 percent from $711.71 million on Jun. 30, 2013. It registered a decrease in current ratio to 1.59 as at Jun. 30, 2014 from 1.90 on Jun. 30, 2013.

Debt Position

Herbalife has witnessed an increase in the total debt over the last one year. As on Jun. 30, 2014, total debt stood at $1837.99 million, up 90.94 percent or $875.40 million, from Jun. 30, 2013.

The company's total debt was 75.46 percent of total assets as on Jun. 30, 2014, compared with 42.71 percent on Jun. 30, 2013.

Shares of the company rose $1.42 or 2.15 percent to close at $67.48 on Monday.