Slide 1: Q4 2023 Earnings Presentation
Q4 2023 Earnings Presentation February 14, 2024
Slide 2: Forward-Looking Statements
Q4 2023 EARNINGS PRESENTATION Forward-Looking Statements This presentation contains "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. All statements other than statements of hi
Slide 3: Strategic Update
Q4 2023 Strategic Update Michael Johnson Chairman & CEO 3
Slide 4: CEO Highlights
Q4 2023 EARNINGS PRESENTATION CEO Highlights • Achieved Q4 2023 YoY net sales growth, up 2.9% to $1.2B o 4 consecutive quarters of improved YoY reported net sales trends • Generated $223M of free cash flow1 in 2023, higher vs 2022 • Paid down $155M of Senior Credit Facility and 2024 Convertible Note
Slide 5: New Product Launches
Q4 2023 EARNINGS PRESENTATION New Product Launches Korea Brazil EMEA* Brazil Formula 1 Express Herbalife24® Pycno® Plus Healthy Meal Bars Shape Control Premium Creatine Cranberry & White Chocolate Combines Pycnogenol and Powdered drink mix to enhance Reformulated with 15g Protein and Gluten-free wei
Slide 6: Herbalife GLP-1 Nutrition Companion Product Combos
Q4 2023 EARNINGS PRESENTATION Herbalife® GLP-1 Nutrition Companion Product Combos Fueled by the World’s #1 Protein Shake1 Vegan Classic Herbalife V • Formula 1 Healthy Meal • Plant-Based Protein Shake Nutritional Shake Mix • Plant-Based Digestive Support* • Protein Drink Mix • Plant-Based Greens Boo
Slide 7: Business Update
Q4 2023 Business Update Stephan Gratziani President 7
Slide 8: Financial Update
Q4 2023 Financial Update Alex Amezquita CFO 8
Slide 9: Key Financial Highlights
Q4 2023 EARNINGS PRESENTATION Key Financial Highlights 1. Achieved Q4 2023 net sales of $1.2B, up 2.9% YoY • Fourth consecutive quarter of improved YoY reported net sales trends 2. Q4 2023 gross profit margin of 76.3% – held flat with Q3 2023 • Q4 2023 YoY, favorably impacted by pricing of ~100 bps,
Slide 10: Results – Financial Highlights
Q4 2023 EARNINGS PRESENTATION Q4 2023 Results – Financial Highlights Net Sales Adjusted EBITDA1 Adjusted Diluted EPS1 $1.2B +2.9% vs Q4 2022 $109M $0.28 Strong Cash Generation, Operating Cash Flows $96M Net Sales FX Impact Adjusted EBITDA1 Margin Free Cash Flow1 ~40 bps 9.0% $61M Tailwind vs Q4 2022
Slide 11: Net Sales: Q4 Drivers of Net Sales Change
Q4 2023 EARNINGS PRESENTATION Net Sales Q4 Drivers of Net Sales Change (% Change vs Prior Year) 4.1% 2.5% 2.9% 0.4% 0.4% (2.0)% Country Mix Local Currency Reported Volume Pricing FX and Other Net Sales1 Net Sales (1) Non-GAAP Measure. Refer to Appendix for discussion of why we believe adjusting for
Slide 12: Adjusted EBITDA Margin Bridge
Q4 2023 EARNINGS PRESENTATION Adjusted EBITDA1 Margin Bridge Q4 Drivers of Adjusted EBITDA1 Margin Change (% Change vs Prior Year) 1.3% 11.1% 0.8% 0.1% 0.1% 9.0% (2.1)% (0.1)% (2.2)% Inventory Promotional Salaries Q4 2022 Pricing Input Costs Reserves Other FX Q4 2023 Related Spend & Bonus & Other CO
Slide 13: Regional Scorecard
Q4 2023 EARNINGS PRESENTATION Regional Scorecard Local Currency Reported Net Sales Net Sales1 Q4 2023 Q4 2022 YoY % Change YoY % Change $ million Asia Pacific 433.5 396.8 +9% +10% North America 252.8 275.0 (8)% (8)% EMEA 250.1 246.8 +1% +1% Latin America 196.4 191.1 +3% (1)% China 82.2 71.1 +16% +17
Slide 14: Capital Structure Update
Q4 2023 EARNINGS PRESENTATION Capital Structure Update • Paid down $155M of Senior Credit Facility and 2024 Convertible Notes, including $126M of early repayments o $330M revolving credit facility remains fully undrawn at Dec 31 ‘23 • $575M cash on hand as of Dec 31 ‘23, up $67M from Dec 31 ‘22 • Gr
Slide 15: Appendix
Q4 2023 EARNINGS PRESENTATION Appendix 15
Slide 16: Supplemental Information
Q4 2023 EARNINGS PRESENTATION Supplemental Information Non-GAAP Financial Measures (unaudited) Adjusted SG&A, Adjusted EBITDA, Adjusted Net Income, Adjusted Diluted EPS and Free Cash Flow In addition to its reported results calculated in accordance with U.S. GAAP, the Company has included in this pr
Slide 17: FY 2023 Results – Financial Highlights
Q4 2023 EARNINGS PRESENTATION FY 2023 Results – Financial Highlights Net Sales Adjusted EBITDA1 Adjusted Diluted EPS1 $5.1B (2.7)% vs FY 2022 $571M $2.21 Operating Cash Flows of $358M Exceed FY 2022 Net Sales FX Impact Adjusted EBITDA1 Margin Free Cash Flow1 ~110 bps 11.3% $223M Headwind vs FY 2022
Slide 18: Net Sales: FY Drivers of Net Sales Change
Q4 2023 EARNINGS PRESENTATION Net Sales FY Drivers of Net Sales Change (% Change vs Prior Year) 8.5% (1.0)% (1.6)% (1.1)% (2.7)% (9.1)% Country Mix Local Currency Reported Volume Pricing FX and Other Net Sales1 Net Sales (1) Non-GAAP Measure. Refer to Supplemental Information included herein for dis
Slide 19: Adjusted EBITDA Margin Bridge (FY)
Q4 2023 EARNINGS PRESENTATION Adjusted EBITDA1 Margin Bridge FY Drivers of Adjusted EBITDA1 Margin Change (% Change vs Prior Year) 2.7% 13.3% - 0.0% 11.3% (2.2)% (0.2)% (0.4)% (1.0)% (0.9)% Inventory Promotional Salaries FY 2022 Pricing Input Costs Reserves Other FX FY 2023 Related Spend & Bonus & O
Slide 20: Regional Scorecard (FY)
Q4 2023 EARNINGS PRESENTATION Regional Scorecard Local Currency Reported Net Sales Net Sales1 FY 2023 FY 2022 YoY % Change YoY % Change $ million Asia Pacific 1,713.9 1,686.9 +2% +5% North America 1,131.4 1,262.2 (10)% (10)% EMEA 1,068.8 1,078.5 (1)% +1% Latin America 820.9 785.8 +4% (1)% China 327.
Slide 21: Reconciliation of SG&A to Adjusted SG&A
Q4 2023 EARNINGS PRESENTATION Reconciliation of SG&A to Adjusted SG&A THREE MONTHS ENDED DECEMBER 31 YEAR ENDED DECEMBER 31 $ million 2023 2022 2023 2022 Net sales 1,215.0 1,180.8 5,062.4 5,204.4 Selling, general, and administrative expenses (SG&A) 474.3 437.3 1,866.0 1,810.4 SG&A as a percentage of
Slide 22: Reconciliation of Net Income to Adjusted EBITDA
Q4 2023 EARNINGS PRESENTATION Reconciliation of Net Income to Adjusted EBITDA THREE MONTHS ENDED DECEMBER 31 YEAR ENDED DECEMBER 31 $ million 2023 2022 2023 2022 Net income 10.2 54.4 142.2 321.3 Interest expense, net 38.1 37.3 154.4 133.2 Income taxes 7.5 10.0 60.8 103.5 Depreciation and amortizatio
Slide 23: Reconciliation of Net Income to Adjusted Net Income
Q4 2023 EARNINGS PRESENTATION Reconciliation of Net Income to Adjusted Net Income THREE MONTHS ENDED DECEMBER 31 YEAR ENDED DECEMBER 31 $ million 2023 2022 2023 2022 Net income 10.2 54.4 142.2 321.3 Net expenses related to COVID-19 pandemic ― 0.6 ― 4.4 Expenses related to Transformation Program 12.2
Slide 24: Reconciliation of Diluted EPS to Adjusted Diluted EPS
Q4 2023 EARNINGS PRESENTATION Reconciliation of Diluted EPS to Adjusted Diluted EPS THREE MONTHS ENDED DECEMBER 31 YEAR ENDED DECEMBER 31 $ per share 2023 2022 2023 2022 Diluted earnings per share 0.10 0.55 1.42 3.23 Net expenses related to COVID-19 pandemic ― 0.01 ― 0.04 Expenses related to Transfo
Slide 25: Reconciliation of Operating Cash Flows to Free Cash Flow
Q4 2023 EARNINGS PRESENTATION Reconciliation of Cash Flows from Operating Activities to Free Cash Flow THREE MONTHS ENDED DECEMBER 31 YEAR ENDED DECEMBER 31 $ million 2023 2022 2023 2022 Net cash provided by operating activities 96.1 53.6 357.5 352.5 Purchases of property, plant and equipment (35.3)
Slide 26: FX Translation Impact
Q4 2023 EARNINGS PRESENTATION FX Translation Impact $ million, except EPS Net Sales EBITDA Net Income Diluted EPS1 Q4 2023 as Reported 1,215.0 84.0 10.2 0.10 Non-GAAP adjustments2 ― 24.8 18.4 0.18 Q4 2023 Adjusted 1,215.0 108.8 28.6 0.28 FX rate adjustments3 (5.3) (2.0) (1.5) (0.01) Q4 2023 FX Adjus
Slide 27: Herbalife
Herbalife’