Citing rising global demand for its nutrition products, downtown-based supplement company Herbalife Nutrition Ltd. reported profit of $48.9 million on revenue of $1.2 billion in its 2018 fourth quarter.
The company saw a loss of $63.4 million on revenue of $1.08 billion in the same year-earlier period.
“In 2018, we continued to show strength of our business in providing nutrition products to distributors and consumers around the world,” said Herbalife Chairman and CEO Michael Johnson, in a statement.
In early January, Herbalife announced that Johnson, who led the company from 2003 to 2017 as CEO, would reassume the role as CEO on an interim basis following the resignation of CEO Richard Goudis.
Goudis’ voluntary departure was not due to any issues regarding the company’s financial reporting, but pertained to “comments which recently came to light,” and were made by Goudis prior to his role as CEO, according to a Herbalife statement from its board of directors, at the time of the executive change.
The company said this week that forward-looking financial guidance for the three months ending March 30 includes a projected currency headwind of roughly 8 cents a share versus the first quarter of 2018.
A Herbalife spokesman declined further comment.
The currency headwind impacting earnings is due to erosion in foreign currency exchange rates, fueled by a stronger dollar in the United States, particularly against emerging market currencies.
A healthy U.S. economy – particularly as much of the rest of the world has weakened — and the Federal Reserve’s interest rate hikes, have strengthened the U.S. dollar. A country’s currency tends to go up in tandem with rates.
A strong dollar is bad news for companies that do a lot of business overseas since it hurts the value of their international sales and profits.
Herbalife’s adjusted full year 2019 guidance includes a projected currency headwind of 22 cents per share, 3 cents better than the initial full year 2019 guidance provided on Oct. 30, 2018, and reaffirmed on Jan. 9.
For 2018, Herbalife reported profit of $296.6 million on revenue of $4.9 billion, versus profit of $213.9 million on revenue $4.4 billion in 2017.
Profit was “negatively impacted” by expenses related to a China grant program, Venezuela currency devaluation, and other factors. Herbalife sells its supplements in 94 countries.
On Wednesday, Herbalife’s stock closed at $56.28 a share, down $1.16 cents, or 2.02 percent.
Finance reporter Pat Maio can be reached at email@example.com or (323) 556-8329.