APHerbalife 3Q profit rises, but outlook disappointsMonday November 3, 6:40 pm ETHerbalife 3rd-quarter earnings rise, outlook 2008, 2009 outlooks lower than Wall Street
LOS ANGELES (AP) -- Herbalife Ltd., which sells nutritional and weight-loss supplements, said Monday its third-quarter earnings rose as international sales increased while operating margins held steady.
The company also issued profit forecasts for the fourth quarter and both 2008 and 2009 that were well below Wall Street estimates. That sent Herbalife shares tumbling more than 15 percent in electronic aftermarket trading.
Net income rose to $58.1 million, or 89 cents per share, from $48.3 million, or 67 cents per share, a year ago.
Sales growth in the U.S., Brazil, China and Italy helped total revenue jump 14 percent to $602.2 million.
Analysts expected profit of 86 cents per share on revenue of $621 million, according to Thomson Reuters.
The company said the dollar's recent sharp appreciation against major world currencies has eaten into sales and profits in the current quarter.
It said a 10 percent decline by a currency against the dollar would lower sales by 7 percent and earnings per share by 22 percent. The company operates in 69 countries, but said most of its foreign currency exposure is to the euro and Mexican peso.
Herbalife expects fourth-quarter earnings between 65 cents and 75 cents per share. Wall Street is looking for 87 cents per share.
For the year, the company anticipates $3.50 to $3.55 per share, while analysts expected $3.68 per share. Looking to next year, the company sees profit of $3 to $3.20 per share
Shares slid $3.95, or 16 percent, to $21.50 in after-hours trading after closing at $25.45 Monday. In the past year, the stock has ranged from $19.70 to $51.09.