Herbalife. (HLF) has reported 6.30 percent fall in profit for the quarter ended Sep. 30, 2016. The company has earned $87.70 million, or $1.01 a share in the quarter, compared with $93.60 million, or $1.09 a share for the same period last year. On the other hand, adjusted net income for the quarter stood at $104.70 million, or $1.21 a share compared with $107.70 million or $1.26 a share, a year ago. Revenue during the quarter went up marginally by 1.73 percent to $1,122 million from $1,102.90 million in the previous year period. Gross margin for the quarter expanded 12 basis points over the previous year period to 81.36 percent. Total expenses were 86.50 percent of quarterly revenues, up from 85.35 percent for the same period last year. That has resulted in a contraction of 115 basis points in operating margin to 13.50 percent.
Operating income for the quarter was $151.50 million, compared with $161.60 million in the previous year period.
Michael O. Johnson, chairman and chief executive officer of Herbalife, stated, "We delivered another strong quarter with 6% growth in worldwide volume and relentless management of expenses which contributed to our exceeding the high end of third quarter EPS guidance."
The company expects diluted earnings per share to be in the range of $0.90 to $1.10 for the fourth-quarter. For fiscal year 2016, the company expects diluted earnings per share to be in the range of $2.77 to $2.97. On an adjusted basis, the company expects diluted earnings per share to be in the range of $0.80 to $1 for the fourth-quarter. For fiscal year 2016, the company expects diluted earnings per share to be in the range of $4.65 to $4.85 on adjusted basis.
Operating cash flow drops significantlyHerbalife has generated cash of $249.90 million from operating activities during the nine month period, down 49.33 percent or $243.30 million, when compared with the last year period. The company has spent $107.50 million cash to meet investing activities during the nine month period as against cash outgo of $51.30 million in the last year period.
The company has spent $241.30 million cash to carry out financing activities during the nine month period as against cash outgo of $217.90 million in the last year period.
Cash and cash equivalents stood at $788.30 million as on Sep. 30, 2016, down 3.06 percent or $24.90 million from $813.20 million on Sep. 30, 2015.
Working capital drops significantly
Herbalife has witnessed a decline in the working capital over the last year. It stood at $296.10 million as at Sep. 30, 2016, down 35.85 percent or $165.50 million from $461.60 million on Sep. 30, 2015. Current ratio was at 1.23 as on Sep. 30, 2016, down from 1.45 on Sep. 30, 2015.
Cash conversion cycle (CCC) has decreased to 52 days for the quarter from 113 days for the last year period. Days sales outstanding were almost stable at 8 days for the quarter, when compared with the last year period.
Days inventory outstanding has decreased to 82 days for the quarter compared with 142 days for the previous year period. At the same time, days payable outstanding was almost stable at 37 days for the quarter, when compared with the previous year period.
Debt comes down
Herbalife has recorded a decline in total debt over the last one year. It stood at $1,442.90 million as on Sep. 30, 2016, down 12.73 percent or $210.50 million from $1,653.40 million on Sep. 30, 2015. Total debt was 56.97 percent of total assets as on Sep. 30, 2016, compared with 68.28 percent on Sep. 30, 2015. Disclaimer: Please note that this is an auto-generated article. IRIS does not guarantee the accuracy, adequacy or completeness of any information and is not responsible for any errors or omissions or for the results obtained from the use of such information. IRIS especially states that it has no financial liability whatsoever to any user on account of the use of information provided on its website. For queries contact: editor@irisindia.net
