Document and Entity Information
Document and Entity Information - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2017 | Feb. 15, 2018 | Jun. 30, 2017 | |
Document And Entity Information [Abstract] | |||
Document Type | 10-K | ||
Amendment Flag | false | ||
Document Period End Date | Dec. 31, 2017 | ||
Document Fiscal Year Focus | 2,017 | ||
Document Fiscal Period Focus | FY | ||
Trading Symbol | HLF | ||
Entity Registrant Name | HERBALIFE LTD. | ||
Entity Central Index Key | 1,180,262 | ||
Current Fiscal Year End Date | --12-31 | ||
Entity Well-known Seasoned Issuer | Yes | ||
Entity Current Reporting Status | Yes | ||
Entity Voluntary Filers | No | ||
Entity Filer Category | Large Accelerated Filer | ||
Entity Common Stock, Shares Outstanding | 87,419,647 | ||
Entity Public Float | $ 1,620 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Millions | Dec. 31, 2017 | Dec. 31, 2016 |
CURRENT ASSETS: | ||
Cash and cash equivalents | $ 1,278.8 | $ 844 |
Receivables, net of allowance for doubtful accounts | 93.3 | 70.3 |
Inventories | 341.2 | 371.3 |
Prepaid expenses and other current assets | 147 | 176.9 |
Total current assets | 1,860.3 | 1,462.5 |
Property, plant and equipment, at cost, net of accumulated depreciation and amortization | 377.5 | 378 |
Marketing related intangibles and other intangible assets, net | 310.1 | 310.1 |
Goodwill | 96.9 | 89.9 |
Other assets | 250.3 | 324.9 |
Total assets | 2,895.1 | 2,565.4 |
CURRENT LIABILITIES: | ||
Accounts payable | 67.8 | 66 |
Royalty overrides | 277.7 | 261.2 |
Current portion of long-term debt | 102.4 | 9.5 |
Other current liabilities | 458.9 | 454.8 |
Total current liabilities | 906.8 | 791.5 |
NON-CURRENT LIABILITIES: | ||
Long-term debt, net of current portion | 2,165.7 | 1,438.4 |
Other non-current liabilities | 157.3 | 139.2 |
Total liabilities | 3,229.8 | 2,369.1 |
COMMITMENTS AND CONTINGENCIES | ||
SHAREHOLDERS’ (DEFICIT) EQUITY: | ||
Common shares, $0.001 par value; 1.0 billion shares authorized; 82.3 million (2017) and 93.1 million (2016) shares outstanding | 0.1 | 0.1 |
Paid-in capital in excess of par value | 407.3 | 467.6 |
Accumulated other comprehensive loss | (165.4) | (205.1) |
Accumulated deficit | (248.1) | (66.3) |
Treasury stock, at cost, 5.0 million shares (2017) | (328.6) | |
Total shareholders’ (deficit) equity | (334.7) | 196.3 |
Total liabilities and shareholders’ (deficit) equity | $ 2,895.1 | $ 2,565.4 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - $ / shares shares in Millions | Dec. 31, 2017 | Dec. 31, 2016 |
Statement Of Financial Position [Abstract] | ||
Common shares, par value | $ 0.001 | $ 0.001 |
Common shares, shares authorized | 1,000 | 1,000 |
Common shares, shares outstanding | 82.3 | 93.1 |
Treasury stock shares, at cost | 5 |
Consolidated Statements of Inco
Consolidated Statements of Income - USD ($) shares in Millions, $ in Millions | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Income Statement [Abstract] | |||
Net sales | $ 4,427.7 | $ 4,488.4 | $ 4,469 |
Cost of sales | 848.6 | 854.6 | 856 |
Gross profit | 3,579.1 | 3,633.8 | 3,613 |
Royalty overrides | 1,254.2 | 1,272.6 | 1,251.4 |
Selling, general and administrative expenses | 1,758.6 | 1,966.9 | 1,784.5 |
Other operating income | (50.8) | (63.8) | (6.5) |
Operating income | 617.1 | 458.1 | 583.6 |
Interest expense | 160.8 | 99.3 | 100.5 |
Interest income | 14.5 | 5.9 | 5.6 |
Other (income) expense, net | (0.4) | 2.3 | |
Income before income taxes | 471.2 | 364.7 | 486.4 |
Income taxes | 257.3 | 104.7 | 147.3 |
NET INCOME | $ 213.9 | $ 260 | $ 339.1 |
Earnings per share | |||
Basic | $ 2.70 | $ 3.13 | $ 4.11 |
Diluted | $ 2.58 | $ 3.02 | $ 3.97 |
Weighted average shares outstanding | |||
Basic | 79.2 | 83 | 82.6 |
Diluted | 82.9 | 86.1 | 85.3 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Statement of Comprehensive Income [Abstract] | |||
Net income | $ 213.9 | $ 260 | $ 339.1 |
Other comprehensive income (loss): | |||
Foreign currency translation adjustment, net of income taxes of $5.7 (2017), $5.2 (2016), and $(7.2) (2015) | 44.9 | (32.5) | (86.6) |
Unrealized loss on derivatives, net of income taxes of $— (2017), $(0.3) (2016), and $(0.6) (2015) | (5.2) | (7) | (0.6) |
Other, net of income taxes of $— (2017), $0.1 (2016), and $(0.1) (2015) | (0.1) | (0.1) | |
Total other comprehensive income (loss) | 39.7 | (39.6) | (87.3) |
Total comprehensive income | $ 253.6 | $ 220.4 | $ 251.8 |
Consolidated Statements of Com6
Consolidated Statements of Comprehensive Income (Parenthetical) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Statement of Comprehensive Income [Abstract] | |||
Foreign currency translation adjustment, tax | $ 5.7 | $ 5.2 | $ (7.2) |
Unrealized loss on derivatives, tax | (0.3) | (0.6) | |
Other, tax | $ 0.1 | $ (0.1) |
Consolidated Statements of Chan
Consolidated Statements of Changes in Shareholders' (Deficit) Equity - USD ($) $ in Millions | Total | Common Shares [Member] | Treasury Stock [Member] | Paid-in Capital in Excess of par Value [Member] | Accumulated Other Comprehensive Loss [Member] | Accumulated Deficit [Member] |
Beginning Balance at Dec. 31, 2014 | $ (334.4) | $ 0.1 | $ 409.1 | $ (78.2) | $ (665.4) | |
Issuance of 1.0 million, 0.6 million and 1.9 million common shares from exercise of stock options, SARs, restricted stock units, employee stock purchase plan, and other, in 2015, 2016, 2017 respectively | 2.8 | 2.8 | ||||
Excess tax deficit from exercise of stock options, SARs and restricted stock grants | (2) | (2) | ||||
Additional capital from share-based compensation | 44.9 | 44.9 | ||||
Repurchases of 0.4 million, 0.2 million and 12.7 million common shares in 2015, 2016 and 2017 respectively | (16.6) | (16.6) | ||||
Net income | 339.1 | 339.1 | ||||
Foreign currency translation adjustment, net of income taxes of $(7.2), $5.2 and $5.7 in 2015, 2016 and 2017 respectively | (86.6) | (86.6) | ||||
Unrealized loss on derivatives, net of income taxes of $(0.6), $(0.3) and $— in 2015, 2016 and 2017 respectively | (0.6) | (0.6) | ||||
Other, net of income taxes of $(0.1) and $0.1 in 2015 and 2016 respectively | (0.1) | (0.1) | ||||
Ending Balance at Dec. 31, 2015 | (53.5) | 0.1 | 438.2 | (165.5) | (326.3) | |
Issuance of 1.0 million, 0.6 million and 1.9 million common shares from exercise of stock options, SARs, restricted stock units, employee stock purchase plan, and other, in 2015, 2016, 2017 respectively | 2 | 2 | ||||
Excess tax benefit from exercise of stock options, SARs and restricted stock grants | 0.4 | 0.4 | ||||
Additional capital from share-based compensation | 40.2 | 40.2 | ||||
Repurchases of 0.4 million, 0.2 million and 12.7 million common shares in 2015, 2016 and 2017 respectively | (13.2) | (13.2) | ||||
Net income | 260 | 260 | ||||
Foreign currency translation adjustment, net of income taxes of $(7.2), $5.2 and $5.7 in 2015, 2016 and 2017 respectively | (32.5) | (32.5) | ||||
Unrealized loss on derivatives, net of income taxes of $(0.6), $(0.3) and $— in 2015, 2016 and 2017 respectively | (7) | (7) | ||||
Other, net of income taxes of $(0.1) and $0.1 in 2015 and 2016 respectively | (0.1) | (0.1) | ||||
Ending Balance at Dec. 31, 2016 | 196.3 | 0.1 | 467.6 | (205.1) | (66.3) | |
Issuance of 1.0 million, 0.6 million and 1.9 million common shares from exercise of stock options, SARs, restricted stock units, employee stock purchase plan, and other, in 2015, 2016, 2017 respectively | 2.1 | 2.1 | ||||
Additional capital from share-based compensation | 42.1 | 42.1 | ||||
Repurchases of 0.4 million, 0.2 million and 12.7 million common shares in 2015, 2016 and 2017 respectively | (855.7) | $ (328.6) | (101.7) | (425.4) | ||
Net income | 213.9 | 213.9 | ||||
Foreign currency translation adjustment, net of income taxes of $(7.2), $5.2 and $5.7 in 2015, 2016 and 2017 respectively | 44.9 | 44.9 | ||||
Unrealized loss on derivatives, net of income taxes of $(0.6), $(0.3) and $— in 2015, 2016 and 2017 respectively | (5.2) | (5.2) | ||||
Cumulative effect of accounting change and other, net of income taxes of $— | 26.9 | (2.8) | 29.7 | |||
Ending Balance at Dec. 31, 2017 | $ (334.7) | $ 0.1 | $ (328.6) | $ 407.3 | $ (165.4) | $ (248.1) |
Consolidated Statements of Cha8
Consolidated Statements of Changes in Shareholders' (Deficit) Equity (Parenthetical) - USD ($) shares in Millions, $ in Millions | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Statement Of Stockholders Equity [Abstract] | |||
Issuance of common shares | 1.9 | 0.6 | 1 |
Repurchases of common shares | 12.7 | 0.2 | 0.4 |
Foreign currency translation adjustment, tax | $ 5.7 | $ 5.2 | $ (7.2) |
Unrealized loss on derivatives, tax | (0.3) | (0.6) | |
Other, tax | $ 0.1 | $ (0.1) |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
CASH FLOWS FROM OPERATING ACTIVITIES | |||
Net income | $ 213.9 | $ 260 | $ 339.1 |
Adjustments to reconcile net income to net cash provided by operating activities: | |||
Depreciation and amortization | 99.8 | 98.3 | 98 |
Share-based compensation expenses | 42.1 | 40.2 | 44.9 |
Non-cash interest expense | 60.2 | 55.7 | 56.2 |
Deferred income taxes | 97.8 | (36.4) | (38.2) |
Inventory write-downs | 20.7 | 15.8 | 25.3 |
Foreign exchange transaction loss | 2.4 | 3.7 | 26.6 |
Other | 1.9 | (11.7) | 10.8 |
Changes in operating assets and liabilities: | |||
Receivables | (22.2) | (6.2) | |
Inventories | 37.9 | (71.6) | (30.5) |
Prepaid expenses and other current assets | 38.3 | 0.8 | 19.8 |
Accounts payable | (5) | (1.3) | 6 |
Royalty overrides | 6 | 20.9 | 21.6 |
Other current liabilities | (17.1) | 12.4 | 73.5 |
Other | 14.1 | (19.5) | (18.2) |
NET CASH PROVIDED BY OPERATING ACTIVITIES | 590.8 | 367.3 | 628.7 |
CASH FLOWS FROM INVESTING ACTIVITIES | |||
Purchases of property, plant and equipment | (95.5) | (143.4) | (79) |
Investments in Venezuelan bonds | (0.1) | ||
Other | (2.3) | 2.1 | 5.7 |
NET CASH USED IN INVESTING ACTIVITIES | (97.8) | (141.3) | (73.4) |
CASH FLOWS FROM FINANCING ACTIVITIES | |||
Borrowings from senior secured credit facility, net of discount | 1,274 | 200 | |
Principal payments on senior secured credit facility and other debt | (494.5) | (438.8) | (227.6) |
Debt issuance costs | (22.6) | (6.2) | |
Share repurchases | (844.2) | (13.2) | (16.6) |
Other | 2.1 | (0.3) | 0.4 |
NET CASH USED IN FINANCING ACTIVITIES | (85.2) | (252.3) | (250) |
EFFECT OF EXCHANGE RATE CHANGES ON CASH | 27 | (19.5) | (60.9) |
NET CHANGE IN CASH AND CASH EQUIVALENTS | 434.8 | (45.8) | 244.4 |
CASH AND CASH EQUIVALENTS, BEGINNING OF YEAR | 844 | 889.8 | 645.4 |
CASH AND CASH EQUIVALENTS, END OF YEAR | 1,278.8 | 844 | 889.8 |
CASH PAID DURING THE YEAR | |||
Interest paid | 100.7 | 45.4 | 50.5 |
Income taxes paid | $ 158.8 | $ 162.9 | $ 168.4 |
Organization
Organization | 12 Months Ended |
Dec. 31, 2017 | |
Accounting Policies [Abstract] | |
Organization | 1. Organization Herbalife Ltd., a Cayman Islands exempted company with limited liability was incorporated on April 4, 2002. Herbalife Ltd. (and together with its subsidiaries, the “Company” or “Herbalife”) is a global nutrition company that sells weight management, targeted nutrition, energy, sports & fitness, and outer nutrition products to and through a network of independent members, or Members. In China, the Company sells its products to and through independent service providers, sales representatives, and sales officers to customers and preferred customers, as well as through Company-operated retail stores when necessary. The Company reports revenue in six geographic regions: North America; Mexico; South and Central America; EMEA, which consists of Europe, the Middle East and Africa; Asia Pacific (excluding China); and China. |
Basis of Presentation
Basis of Presentation | 12 Months Ended |
Dec. 31, 2017 | |
Accounting Policies [Abstract] | |
Basis of Presentation | 2. Basis of Presentation The Company’s consolidated financial statements refer to Herbalife Ltd. and its subsidiaries. Recently Adopted Pronouncements In March 2016, the Financial Accounting Standards Board, or FASB, issued Accounting Standards Update, or ASU No. 2016-09, Compensation — Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting In Derivatives and Hedging (Topic 815): Contingent Put and Call Options in Debt Instruments Derivatives and Hedging In March 2016, the FASB issued ASU No. 2016-05, Derivatives and Hedging (Topic 815): Effect of Derivative Contract Novations on Existing Hedge Accounting Relationships New Accounting Pronouncements In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers (Topic 606) Below is a summary of the Company’s analysis under Topic 606: The Company will generally continue to recognize revenue when product is delivered to its Members. For China independent service providers, and for third party importers utilized in certain other countries where sales historically have not been material, the Company will continue to recognize revenue based on the Company’s estimate of when the service provider or third party importer sells the products because the Company is deemed to be the principal party of these product sales under Topic 606 due to the additional selling and operating requirements relating to pricing of products, conducting business with physical locations, and other selling and marketing activities required of the service providers and third party importers; this timing difference relating to the Company recognizing revenues when these third party entities sell the products compared to when the Company delivers the products to them did not have a material impact to the Company’s consolidated net sales for the periods presented. The Company’s Members, excluding its China independent service providers, may receive distributor allowances, which are comprised of discounts, rebates and wholesale commission payments from the Company. Pursuant to Topic 606, the distributor allowances resulting from the Company’s sales of its products to its Members will continue to be recorded against net sales because the distributor allowances represent discounts from the suggested retail price. The Company compensates its sales leader Members with royalty overrides for services rendered, relating to the development, retention, and management of their sales organizations. Royalty overrides are payable based on achieved sales volume. Royalty overrides will continue to be classified as an operating expense reflecting the services provided to the Company. The Company compensates its China independent service providers and third party importers utilized in certain other countries for providing marketing, selling, and customer support services. Under Topic 606, as the Company is the principal party of the product sales as described above, the service fees payable to China independent service providers and the compensation received by third party importers for the services they provide will be recorded within Selling, general & administrative expenses. Currently, under Topic 605, the service fees payable to its China independent service providers are similarly recognized within Selling, general & administrative expenses as they will be under Topic 606. However, under Topic 605, the compensation received by third party importers for the services they provide, which represents the discount provided to them, is recorded as a reduction to net sales, which differs from the treatment under Topic 606 as described above. This change in the accounting treatment under Topic 606 of the compensation for services provided by the Company’s third party importers will not impact the Company’s consolidated net income and is not material to the Company’s consolidated net sales for the fiscal years presented. The Company also reviewed its United States business and the changes required to be made pursuant to the FTC consent order. The Company has concluded that there will be no material financial impact under Topic 606 and the Company will continue to recognize revenues when it delivers the products to its United States Members; its distributor allowances, inclusive of discounts and wholesale commissions, will continue to be recorded as a reduction to net sales, and royalty overrides will continue to be classified as an operating expense under Topic 606. Shipping and handling services relating to product sales will be recognized as fulfillment activities on the Company’s performance obligation to transfer products and will therefore be recorded within net sales as part of product sales and will not be considered as separate revenues under Topic 606. Shipping and handling costs paid by the Company are currently included in cost of sales and these costs will continue to be recorded to cost of sales under Topic 606. In January 2016, the FASB issued ASU No. 2016-01, Financial Instruments – Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities The adoption of this guidance will not have a material impact on the Company’s consolidated financial statements. In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842) and subsequently issued additional updates to Topic 842. The updated guidance requires lessees to recognize a lease liability and a right-of-use asset, measured at the present value of the future minimum lease payments, at the lease commencement date. Recognition, measurement and presentation of expenses will depend on classification as a finance or operating lease. The amendments also require certain quantitative and qualitative disclosures. ASU 2016-02 is effective for all interim and annual reporting periods beginning after December 15, 2018, with early adoption permitted. A modified retrospective approach must be applied for leases existing at, or entered into after, the beginning of the earliest comparative period presented in the financial statements. The Company is evaluating the potential impact of this adoption on its consolidated financial statements; however, increases in both assets and liabilities are expected. In March 2016, the FASB issued ASU No. 2016-04, Liabilities — Extinguishments of Liabilities (Subtopic 405-20): Recognition of Breakage for Certain Prepaid Stored-Value Products In June 2016, the FASB issued ASU No. 2016-13, Financial Instrument — Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments . This ASU changes the impairment model for most financial assets, requiring the use of an expected loss model which requires entities to estimate the lifetime expected credit loss on financial assets measured at amortized cost. Such credit losses will be recorded as an allowance to offset the amortized cost of the financial asset, resulting in a net presentation of the amount expected to be collected on the financial asset. In addition, The amendments in this update are effective for reporting periods beginning after December 15, 2019, with early adoption permitted for reporting periods beginning after December 15, 2018. The Company is evaluating the potential impact of this adoption on its consolidated financial statements. In August 2016, the FASB issued ASU No. 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments . This ASU provides clarification on eight specific cash flow issues regarding presentation and classification in the statement of cash flows with the objective of reducing the existing diversity in practice. The amendments in this update are effective for reporting periods beginning after December 15, 2017, with early adoption permitted. The adoption of this guidance will not have a material impact on the Company’s consolidated financial statements. In October 2016, the FASB issued ASU No. 2016-16, Income Taxes (Topic 740): Intra-Entity Transfers of Assets Other Than Inventory Consolidation The adoption of this guidance will not have a material impact on the Company’s consolidated financial statements. In November 2016, the FASB issued ASU No. 2016-18, Statement of Cash Flows (Topic 230): Restricted Cash In January 2017, the FASB issued ASU No. 2017-04, Intangibles — Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment In May 2017, the FASB issued ASU No. 2017-09, Compensation — Stock Compensation (Topic 718): Scope of Modification Accounting In August 2017, the FASB issued ASU No. 2017-12, Derivatives and Hedging: Targeted Improvements to Accounting for Hedging Activities Reclassifications In order to improve and simplify the Company’s financial statements, the following reclassifications have been made: Certain reclassifications were made to the prior period consolidated balance sheets, the consolidated statements of comprehensive income and the consolidated statements of cash flows to conform to the current period presentation. See Note 14, Detail of Certain Balance Sheet Accounts The Company also combined its shipping and handling revenues with its product sales into a single net sales caption in order to conform to the current period presentation as permitted under Regulation S-X. Shipping and handling revenues related to product sales were $227.4 million, $244.2 million, and $282.5 million for the years ended December 31, 2017, 2016, and 2015, respectively, and represent less than 7% of the Company’s consolidated net sales during each of those years. Significant Accounting Policies Consolidation Policy The consolidated financial statements include the accounts of Herbalife Ltd. and its subsidiaries. All significant intercompany transactions and accounts have been eliminated. Foreign Currency Translation and Transactions In the majority of the countries that the Company operates, the functional currency is the local currency. The Company’s foreign subsidiaries’ asset and liability accounts are translated for consolidated financial reporting purposes into U.S. dollar amounts at year-end exchange rates. Revenue and expense accounts are translated at the average rates during the year. Foreign exchange translation adjustments are included in accumulated other comprehensive loss on the accompanying consolidated balance sheets. Foreign currency transaction gains and losses, which include the cost of foreign currency derivative contracts and the related settlement gains and losses but excluding certain foreign currency derivatives designated as cash flow hedges as discussed in Note 11, Derivative Instruments and Hedging Activities Forward Exchange Contracts The Company enters into foreign currency derivatives, primarily comprised of foreign currency forward contracts, in managing its foreign exchange risk on sales to Members, inventory purchases denominated in foreign currencies, and intercompany transactions and loans. The Company does not use the contracts for trading purposes. In accordance with FASB ASC, Topic 815, Derivatives and Hedging Cash and Cash Equivalents The Company considers all highly liquid investments purchased with a maturity of three months or less to be cash equivalents. Cash and cash equivalents are comprised primarily of foreign and domestic bank accounts, and money market funds. These cash and cash equivalents are valued based on level 1 inputs which consist of quoted prices in active markets. To reduce its credit risk, the Company monitors the credit standing of the financial institutions that hold the Company’s cash and cash equivalents. The Company has a cash pooling arrangement with a financial institution for cash management purposes. This cash pooling arrangement allows certain of the Company’s participating subsidiaries to withdraw cash from this financial institution based upon the Company’s aggregate cash deposits held by subsidiaries who participate in the cash pooling arrangement. To the extent any participating location on an individual basis is in an overdraft position, these overdrafts will be recorded as liabilities and reflected as financing activities in the Company’s consolidated balance sheets and consolidated statement of cash flows, respectively. As of December 31, 2017 and December 31, 2016, the Company did not owe any amounts to this financial institution. Accounts Receivable Accounts receivable consist principally of receivables from credit card companies, arising from the sale of products to the Company’s Members, and receivables from importers, who are utilized in a limited number of countries to sell products to Members. The Company believes the concentration of its collection risk related to its credit card receivables is diminished due to the geographic dispersion of its receivables. The receivables from credit card companies were $68.1 million and $51.8 million as of December 31, 2017 and 2016, respectively. Substantially all of the receivables from credit card companies were current as of December 31, 2017 and 2016. Although receivables from importers can be significant, the Company performs ongoing credit evaluations of its importers and maintains an allowance for potential credit losses. The Company considers customer credit-worthiness, past and current transaction history with the customer, contractual terms, current economic industry trends, and changes in customer payment terms when determining whether collectability is reasonably assured and whether to record allowances for its receivables. If the financial condition of the Company’s customers deteriorates and adversely affects their ability to make payments, additional allowances will be recorded. The Company believes that it provides adequate allowances for receivables from its Members and importers which are not material to its consolidated financial statements. During the years ended December 31, 2017, 2016, and 2015, the Company recorded $0.9 million, $1.0 million, and $3.7 million, respectively, in bad-debt expense related to allowances for the Company’s receivables. As of December 31, 2017 and 2016, the Company’s allowance for doubtful accounts was $1.2 million and $1.3 million, respectively. As of December 31, 2017 and 2016, the majority of the Company’s total outstanding accounts receivable were current. Fair Value of Financial Instruments The Company applies the provisions of FASB authoritative guidance as it applies to its financial and non-financial assets and liabilities. The FASB authoritative guidance clarifies the definition of fair value, prescribes methods for measuring fair value, establishes a fair value hierarchy based on the inputs used to measure fair value, and expands disclosures about fair value measurements. The Company has estimated the fair value of its financial instruments using the following methods and assumptions: • The carrying amounts of cash and cash equivalents, receivables and accounts payable approximate fair value due to the short-term maturities of these instruments; • The fair value of available-for-sale investments are based on prices of similar assets traded in active markets and observable yield curves; • The fair value of option and forward contracts are based on dealer quotes; • The Company’s variable rate revolving credit facility is recorded at carrying value and is considered to approximate its fair value; • The fair value of the outstanding borrowings on the Company’s term loan under its senior secured credit facility is determined by utilizing over-the-counter market quotes; • The Company’s convertible senior notes issued in February 2014, or the Convertible Notes, are recorded at carrying value, and their fair value is determined using two valuation methods. The Company reviewed market data that was available for publicly traded, senior, unsecured nonconvertible corporate bonds issued by companies with similar credit ratings. Assumptions used in the estimate represent what market participants would use in pricing the liability component, including market yields and credit standing to develop the straight debt yield estimate. The Company also used a lattice model, which included inputs such as stock price, the Convertible Notes trading price, volatility and dividend yield as of December 31, 2017, to estimate the straight debt yield. The Company combined the results of the two valuation methods to determine the fair value of the liability component of the Convertible Notes. See Note 4, Long-Term Debt • The fair value of the CVR provided to participants in connection with the modified Dutch auction tender offer completed in October 2017, is based on a lattice model, which includes inputs such as the underlying stock price, strike price, time to expiration, and dividend yield. See Note 8, Shareholders’ (Deficit) Equity Inventories Inventories are stated at lower of cost (primarily on the first-in, first-out basis) and net realizable value. Debt Issuance Costs Debt issuance costs represent fees and expenses related to the borrowing of the Company’s long-term debt and are amortized over the term of the related debt using the effective interest method. Debt issuance costs, except for the Company’s revolving credit facility, are recorded as a reduction to debt (contra-liability) within the Company’s consolidated balance sheets. Total amortization expense related to debt issuance costs were $8.4 million, $7.9 million, and $8.5 million for the years ended December 31, 2017, 2016, and 2015, respectively. As of December 31, 2017 and 2016, the Company’s remaining unamortized debt issuance cost was $26.2 million and $11.9 million, respectively. Long-Lived Assets As of December 31, 2017 and 2016, the Company’s net property, plant and equipment consisted of the following (in millions): December 31, 2017 2016 Property, plant and equipment — at cost: Land and building $ 51.0 $ 51.0 Furniture and fixtures 26.7 25.9 Equipment 803.5 719.8 Building and leasehold improvements 199.0 185.7 1,080.2 982.4 Less: accumulated depreciation and amortization (702.7 ) (604.4 ) Net property, plant and equipment $ 377.5 $ 378.0 In December 2012, the Company purchased an approximate 800,000 square foot facility in Winston-Salem, North Carolina, for approximately $22.2 million. The Company allocated $18.8 million and $3.4 million between buildings and land respectively, based on their relative fair values. In April 2016, the Company purchased one of its office buildings in Torrance, California, which it had previously leased, for approximately $29.6 million. The Company allocated $16.9 million and $11.6 million, which was net of the deferred rent liability of $1.1 million, between buildings and land, respectively, based on their relative fair values. As of December 31, 2017 and 2016, these amounts have been reflected in property, plant and equipment on the Company’s accompanying consolidated balance sheets. Depreciation of furniture, fixtures, and equipment (includes computer hardware and software) is computed on a straight-line basis over the estimated useful lives of the related assets, which range from three to ten years. The Company capitalizes eligible costs to acquire or develop internal-use software that are incurred subsequent to the preliminary project stage. Computer hardware and software, the majority of which is comprised of capitalized internal-use software costs, was $157.3 million and $145.7 million as of December 31, 2017 and 2016, respectively, net of accumulated depreciation. Leasehold improvements are amortized on a straight-line basis over the life of the related asset or the term of the lease, whichever is shorter. Buildings are depreciated over 40 years. Building improvements are generally depreciated over ten to fifteen years. Land is not depreciated. Depreciation and amortization expenses recorded to selling, general and administrative expenses totaled $80.1 million, $80.7 million, and $82.5 million, for the years ended December 31, 2017, 2016, and 2015, respectively. Long-lived assets are reviewed for impairment, based on undiscounted cash flows, whenever events or changes in circumstances indicate that the carrying amount of such assets may not be recoverable. Measurement of an impairment loss is based on the estimated fair value of the asset. Goodwill and marketing related intangible assets with indefinite lives are evaluated on an annual basis for impairment or more frequently if events or changes in circumstances indicate that the asset might be impaired. For goodwill, the Company uses a discounted cash flow approach to estimate the fair value of a reporting unit. If the fair value of the reporting unit is less than the carrying value then the implied fair value of the goodwill must be determined. If the implied fair value of the goodwill is less than its carrying value then a goodwill impairment amount is recorded for the difference. For the marketing related intangible assets, the Company uses a discounted cash flow model under the relief-from-royalty method in order to determine the fair value. If the fair value is less than its carrying value then an impairment amount is recorded for the difference. During the years ended December 31, 2017, 2016, and 2015, there were no additions to goodwill or marketing related intangible assets or impairments of goodwill or marketing related intangible assets. As of December 31, 2017 and 2016, the marketing-related intangible asset balance was $310.0 million which consisted of the Company’s trademark, trade name, and marketing franchise. As of December 31, 2017 and 2016, the goodwill balance was $96.9 million and $89.9 million, respectively. The increase in goodwill during the year ended December 31, 2017 was due to cumulative translation adjustments. Other Assets Other assets on the Company’s accompanying consolidated balance sheets include deferred tax assets of $77.5 million and $155.2 million as of December 31, 2017 and 2016, respectively. See Note 14, Detail of Certain Balance Sheet Accounts , for a further description of other assets. Income Taxes Income tax expense includes income taxes payable for the current year and the change in deferred income tax assets and liabilities for the future tax consequences of events that have been recognized in the Company’s financial statements or income tax returns. A valuation allowance is recognized to reduce the carrying value of deferred income tax assets if it is believed to be more likely than not that a component of the deferred income tax assets will not be realized. The Company accounts for uncertainty in income taxes in accordance with FASB authoritative guidance which clarifies the accounting and reporting for uncertainties in income taxes recognized in an enterprise’s financial statements. This guidance prescribes a comprehensive model for the financial statement recognition, measurement, presentation and disclosure of uncertain tax positions taken or expected to be taken in income tax returns. On December 22, 2017, the U.S. enacted the 2017 Tax Cuts and Jobs Act which contains several key tax provisions that affect the Company, including, but not limited to, a one-time mandatory transition tax on accumulated foreign earnings, changes in the sourcing and calculation of foreign income, and a reduction of the corporate income tax rate to 21% effective January 1, 2018. The Company is required to recognize the effect of the tax law changes in the period of enactment, such as determining the transition tax, remeasuring its U.S. deferred tax assets and liabilities as well as reassessing the net realizability of its deferred tax assets and liabilities. In December 2017, the SEC staff issued Staff Accounting Bulletin No. 118, Income Tax Accounting Implications of the Tax Cuts and Jobs Act Income Taxes Royalty Overrides Certain Members may earn commissions, called royalty overrides which include production bonuses, based on retail sales volume. Royalty overrides are based on the retail sales volume of certain other Members who are sponsored directly or indirectly by the Member. Royalty overrides are recorded when the products are delivered and revenue is recognized. The royalty overrides are compensation to Members for services rendered including the development, retention and the improved productivity of their sales organizations. As such royalty overrides are classified as an operating expense. Non-U.S. royalty override checks that have aged, for a variety of reasons, beyond a certainty of being paid, are taken back into income. Management has estimated this period of certainty to be three years worldwide. Distributor Compensation – U.S. In the U.S., distributor compensation, including Royalty Overrides, is capped if the Company does not meet an annual requirement as described in the consent order discussed in more detail in Note 7, Contingencies Comprehensive Income Comprehensive income consists of net income, foreign currency translation adjustments, the effective portion of the unrealized gains or losses on derivatives, and unrealized gains or losses on available-for-sale investments. See Note 8, Shareholders’ (Deficit) Equity Operating Leases The Company leases most of its physical properties under operating leases. Certain lease agreements generally include rent holidays and tenant improvement allowances. The Company recognizes rent holiday periods on a straight-line basis over the lease term beginning when the Company has the right to the leased space. The Company also records tenant improvement allowances and rent holidays as deferred rent liabilities and amortizes the deferred rent over the terms of the lease to rent expense. Research and Development The Company’s research and development is performed by in-house staff and outside consultants. For all periods presented, research and development costs were expensed as incurred and were not material. Other Operating Income To encourage local investment and operations, governments in various China provinces conduct grant programs. The Company applied for and received several such grants in China. Government grants are recorded into income when a legal right to the grant exists, there is a reasonable assurance that the grant proceeds will be received, and the substantive conditions under which the grants were provided have been met. During the years ended December 31, 2017, 2016, and 2015, the Company recognized government grant income of approximately $50.8 million, $34.2 million, and $6.5 million, respectively, in other operating income within its consolidated statements of income, related to its regional headquarters and distribution centers within China. The Company intends to continue applying for government grants in China when programs are available; however, there is no assurance that the Company will receive grants in future periods. On October 30, 2016, an arbitration tribunal awarded the Company approximately $29.7 million in connection with the re-audit of the Company’s 2010 to 2012 financial statements after the resignation of KPMG as the Company’s independent registered public accounting firm. This amount has been recognized in other operating income within the Company’s consolidated financial statements for the year ended December 31, 2016. Professional Fees The Company expenses professional fees, including legal fees, as incurred. These professional fees are included in selling, general and administrative expenses in the Company’s consolidated statements of income. Advertising Advertising costs, including Company sponsorships, are expensed as incurred and amounted to approximately $55.7 million, $64.8 million, and $66.1 million for the years ended December 31, 2017, 2016, and 2015, respectively. These expenses are included in selling, general and administrative expenses in the accompanying consolidated statements of income. Earnings Per Share Basic earnings per share represents net income for the period common shares were outstanding, divided by the weighted average number of common shares outstanding for the period. Diluted earnings per share represents net income divided by the weighted average number of common shares outstanding, inclusive of the effect of dilutive securities such as outstanding stock options, stock appreciation rights, or SARs, and stock units. The following are the common share amounts used to compute the basic and diluted earnings per share for each period (in millions): Year Ended December 31, 2017 2016 2015 Weighted average shares used in basic computations 79.2 83.0 82.6 Dilutive effect of exercise of equity grants outstanding 3.7 3.1 2.7 Weighted average shares used in diluted computations 82.9 86.1 85.3 There were an aggregate of 3.4 million, 4.5 million, and 5.4 million of equity grants, consisting of stock options, SARs, and stock units that were outstanding during the years ended December 31, 2017, 2016, and 2015, respectively, but were not included in the computation of diluted earnings per share because their effect would be anti-dilutive or the performance condition of the award had not been satisfied. Since the Company will settle the principal amount of its Convertible Notes in cash and settle the conversion feature for the amount above the conversion price in common shares, or the conversion spread, the Company uses the treasury stock method for calculating any potential dilutive effect of the conversion spread on diluted earnings per share, if applicable. The conversion spread will have a dilutive impact on diluted earnings per share when the average market price of the Company’s common shares for a given period exceeds the initial conversion price of $86.28 per share. For the years ended December 31, 2017, 2016, and 2015, the Convertible Notes have been excluded from the computation of diluted earnings per share as the effect would be anti-dilutive since the conversion price of the Convertible Notes exceeded the average market price of the Company’s common shares for the years ended December 31, 2017, 2016, and 2015. The initial conversion rate and conversion price is described further in Note 4, Long-Term Debt The capped call transactions executed in connection with the issuance of the Convertible Notes are excluded from the calculation of diluted earnings per share because their impact is always anti-dilutive. Additionally, the forward transactions executed in connection with the issuance of the Convertible Notes are treated as retired shares for basic and diluted EPS purposes, although they remain legally outstanding. See Note 4, Long-Term Debt Revenue Recognition The Company generally recognizes revenue upon delivery and when both the title and risk and rewards pass to the Member or importer, or as products are sold Segment Information Product sales are recognized net of product returns and discounts referred to as “distributor allowances.” Net sales include product sales and the related shipping and handling revenues. Shipping and handling revenues related to product sales were $227.4 million, $244.2 million, and $282.5 million for the years ended December 31, 2017, 2016, and 2015, respectively. Shipping and handling costs paid by the Company are included in cost of sales. The Company generally receives the net sales price in cash or through credit card payments at the point of sale. The Company currently presents sales taxes collected from customers on a net basis. Allowances for product returns, primarily in connection with the Company’s buyback program, are provided at the time the sale is recorded. This accrual is based upon historical return rates for each country and the relevant return pattern, which reflects anticipated returns to be received over a period of up to 12 months following the original sale. Allowances for product returns were $3.9 million, $3.9 million, and $3.9 million as of December 31, 2017, 2016, and 2015, respectively. Product returns were $4.4 million, $4.5 million, and $5.0 million during the years ended December 31, 2017, 2016, and 2015, respectively. Non-Cash Investing and Financing Activities During the years ended December 31, 2017, 2016, and 2015, the Company recorded $10.1 million, $12.7 million, and $12.3 million, respectively, of non-cash capital expenditures. In addition, during the year ended December 31, 2015, the Company recorded $15.0 million of a non-cash release of deposits in escrow that were used to reduce the Company’s accrued expense liability. During the years ended December 31, 2017, 2016, and 2015, the Company recorded $2.3 million, $20.8 million, and $17.3 million of non-cash borrowings that were used to finance software maintenance. Additionally, see Note 8, Shareholders’ (Deficit |
Inventories
Inventories | 12 Months Ended |
Dec. 31, 2017 | |
Inventory Disclosure [Abstract] | |
Inventories | 3. Inventories The following are the major classes of inventory (in millions): December 31, 2017 2016 Raw materials $ 44.2 $ 49.3 Work in process 4.8 3.9 Finished goods 292.2 318.1 Total $ 341.2 $ 371.3 |
Long-Term Debt
Long-Term Debt | 12 Months Ended |
Dec. 31, 2017 | |
Debt Disclosure [Abstract] | |
Long-Term Debt | 4. Long-Term Debt Long-term debt consists of the following: December 31, 2017 2016 (In millions) Borrowings under prior senior secured credit facility, carrying value $ — $ 410.0 Borrowings under new senior secured credit facility, carrying value 1,190.2 — Convertible senior notes, carrying value of liability component 1,070.0 1,024.8 Other 7.9 13.1 Total 2,268.1 1,447.9 Less: current portion 102.4 9.5 Long-term portion $ 2,165.7 $ 1,438.4 Senior Secured Credit Facility On May 4, 2015, the Company amended its prior senior secured credit facility, or the Prior Credit Facility, to extend the maturity date of its revolving credit facility, or the Prior Revolving Credit Facility, by one year to March 9, 2017. Pursuant to this amendment and upon execution, the Company made prepayments of approximately $20.3 million and $50.9 million on its $500 million term loan under the Prior Credit Facility, or the Prior Term Loan, and the Prior Revolving Credit Facility, respectively. Additionally, the Company’s $700 million borrowing capacity on its Prior Revolving Credit Facility was reduced by approximately $235.9 million upon execution of this amendment, and was further reduced by approximately $39.1 million on September 30, 2015. The Prior Term Loan matured on March 9, 2016 and was repaid in full. The total available borrowing capacity under the Prior Revolving Credit Facility was $425.0 million as of December 31, 2016. Prior to March 9, 2016, the interest rates on the Company’s borrowings under the Prior Credit Facility remained effectively unchanged except that the minimum applicable margin was increased by 0.50% and LIBOR was subject to a minimum floor of 0.25%. After March 9, 2016, the applicable interest rates on the Company’s borrowings under the Prior Credit Facility increased by 2.00% such that borrowings under the Prior Credit Facility began bearing interest at either LIBOR plus the applicable margin between 4.00% and 5.00% or the base rate plus the applicable margin between 3.00% and 4.00%, based on the Company’s consolidated leverage ratio. The Company incurred approximately $6.2 million of debt issuance costs in connection with the amendment. These debt issuance costs were recorded on the Company’s consolidated balance sheet and were amortized over the life of the Prior Revolving Credit Facility. On February 15, 2017, the Company entered into a new $1,450.0 million senior secured credit facility, or the Credit Facility, consisting of a $1,300.0 million term loan B, or the Term Loan, and a $150.0 million revolving credit facility, or the Revolving Credit Facility, with a syndicate of financial institutions as lenders, or Lenders. The Revolving Credit Facility matures on February 15, 2022 and the Term Loan matures on February 15, 2023. However, if the outstanding principal on the Convertible Notes, as defined below, exceeds $250.0 million and the Company exceeds certain leverage ratios on February 14, 2019, the Revolving Credit Facility will mature on such date. In addition, if the outstanding principal on the Convertible Notes, as defined below, exceeds $250.0 million and the Company exceeds certain leverage ratios on May 16, 2019, the Term Loan will mature on such date. The Credit Facility is secured by certain assets of Herbalife Ltd. and certain of its subsidiaries. The Term Loan was issued to the Lenders at a 2% discount, or $26.0 million. In connection with the Credit Facility, the Company also repaid the $410.0 million outstanding balance on its Prior Revolving Credit Facility. The Company incurred approximately $22.6 million of debt issuance costs in connection with the Credit Facility. The debt issuance costs and the discount are recorded on the Company’s consolidated balance sheet and are being amortized over the life of the Credit Facility using the effective interest method. Borrowings under the Term Loan bear interest at either the eurocurrency rate plus a margin of 5.50% or the base rate plus a margin of 4.50%. Prior to August 15, 2017, borrowings under the Revolving Credit Facility bore interest at the eurocurrency rate plus a margin of 4.75% or the base rate plus a margin of 3.75%. After August 15, 2017, borrowings under the Revolving Credit Facility, depending on Herbalife’s consolidated leverage ratio, bear interest at either the eurocurrency rate plus a margin of either 4.50% or 4.75% or the base rate plus a margin of either 3.50% or 3.75%. The base rate represents the highest of the Federal Funds Rate plus 0.50%, one-month adjusted LIBOR plus 1.00%, and the prime rate set by Credit Suisse, and is subject to a floor of 1.75%. The eurocurrency rate is based on adjusted LIBOR and is subject to a floor of 0.75%. The Company is required to pay a commitment fee on the Revolving Facility of 0.50% per annum on the undrawn portion of the Revolving Credit Facility. Interest is due at least quarterly on amounts outstanding on the Credit Facility. The Credit Facility requires the Company to comply with a leverage ratio. In addition, the Credit Facility contains customary events of default and covenants, including covenants that limit or restrict the Company’s ability to incur liens, incur indebtedness, make investments, dispose of assets, make certain restricted payments, pay dividends, repurchase its common shares, merge or consolidate and enter into certain transactions with affiliates. The Company is also required to maintain a minimum balance of $200.0 million of consolidated cash and cash equivalents. As of December 31, 2017 and December 31, 2016, the Company was in compliance with its debt covenants under the Credit Facility and the Prior Credit Facility, respectively. The Term Loan is payable in consecutive quarterly installments each in an aggregate principal amount of $24.4 million which began on June 30, 2017. In addition, the Company may be required to make mandatory prepayments towards the Term Loan based on the Company’s consolidated leverage ratio and annual excess cash flows as defined under the terms of the Credit Facility. The Company is also permitted to make voluntary prepayments. These prepayments, if any, will be applied against remaining quarterly installments owed under the Term Loan in order of maturity with the remaining principal due upon maturity. The Company currently does not expect to make a mandatory prepayment toward the Term Loan based on its 2017 excess cash flow calculation as defined under the terms of the Credit Facility. On December 31, 2017 and December 31, 2016, the weighted average interest rate for borrowings under the Credit Facility and the Prior Credit Facility was 6.79% and 4.29%, respectively. During the year ended December 31, 2017, the Company repaid a total amount of $483.1 million, including $410.0 million to repay in full amounts outstanding on the Prior Revolving Credit Facility. During the year ended December 31, 2016, the Company borrowed an aggregate amount of $200.0 million and paid a total amount of $429.7 million under the Prior Credit Facility. During the year ended December 31, 2017, the Company recognized $82.2 million of interest expense relating to the Term Loan, which included $4.2 million relating to non-cash interest expense relating to the debt discount and $2.8 million relating to amortization of debt issuance costs. The fair value of the outstanding borrowings on the Term Loan is determined by utilizing over-the-counter market quotes, which are considered Level 2 inputs as described in Note 13, Fair Value Measurements Fair Value Measurements Convertible Senior Notes During February 2014, the Company initially issued $1 billion aggregate principal amount of convertible senior notes, or Convertible Notes, in a private offering to qualified institutional buyers, pursuant to Rule 144A under the Securities Act of 1933, as amended. The Company granted an option to the initial purchasers to purchase up to an additional $150 million aggregate principal amount of Convertible Notes which was subsequently exercised in full during February 2014, resulting in a total issuance of $1.15 billion aggregate principal amount of Convertible Notes. The Convertible Notes are senior unsecured obligations which rank effectively subordinate to any of the Company’s existing and future secured indebtedness, including amounts outstanding under the Credit Facility, to the extent of the value of the assets securing such indebtedness. The Convertible Notes pay interest at a rate of 2.00% per annum payable semiannually in arrears on February 15 and August 15 of each year, beginning on August 15, 2014. The Convertible Notes mature on August 15, 2019, unless earlier repurchased or converted. The Company may not redeem the Convertible Notes prior to their stated maturity date. Holders of the Convertible Notes may convert their notes at their option under the following circumstances: (i) during any calendar quarter commencing after the calendar quarter ending March 31, 2014, if the last reported sale price of the Company’s common shares for at least 20 trading days (whether or not consecutive) in a period of 30 consecutive trading days ending on, and including, the last trading day of the immediately preceding calendar quarter exceeds 130% of the conversion price for the Convertible Notes on each applicable trading day; (ii) during the five business-day period immediately after any five consecutive trading day period, or the measurement period, in which the trading price per $1,000 principal amount of Convertible Notes for each trading day of that measurement period was less than 98% of the product of the last reported sale price of the Company’s common shares and the conversion rate for the Convertible Notes for each such day; or (iii) upon the occurrence of specified corporate events. On and after May 15, 2019, holders may convert their Convertible Notes at any time, regardless of the foregoing circumstances. Upon conversion, the Convertible Notes will be settled in cash and, if applicable, the Company’s common shares, based on the applicable conversion rate at such time. The Convertible Notes had an initial conversion rate of 11.5908 common shares per $1,000 principal amount of the Convertible Notes (which is equal to an initial conversion price of approximately $86.28 per common share). The Company incurred approximately $26.6 million of issuance costs during the first quarter of 2014 relating to the issuance of the Convertible Notes. Of the $26.6 million issuance costs incurred, $21.5 million and $5.1 million were recorded as debt issuance costs and additional paid-in capital, respectively, in proportion to the allocation of the proceeds of the Convertible Notes. The $21.5 million of debt issuance cost recorded on the Company’s consolidated balance sheet is being amortized over the contractual term of the Convertible Notes using the effective interest method. During February 2014, the $1.15 billion proceeds received from the issuance of the Convertible Notes were initially allocated between long-term debt, or liability component, and additional paid-in-capital, or equity component, within the Company’s consolidated balance sheet at $930.9 million and $219.1 million, respectively. The liability component was measured using the nonconvertible debt interest rate. The carrying amount of the equity component representing the conversion option was determined by deducting the fair value of the liability component from the face value of the Convertible Notes as a whole. Since the Company must still settle these Convertible Notes at face value at or prior to maturity, this liability component will be accreted up to its face value resulting in additional non-cash interest expense being recognized within the Company’s consolidated statements of income while the Convertible Notes remain outstanding. The effective interest rate on the Convertible Notes is approximately 6.2% per annum. The equity component is not remeasured as long as it continues to meet the conditions for equity classification. As of December 31, 2017, the outstanding principal on the Convertible Notes was $1.15 billion, the unamortized debt discount and debt issuance cost was $80.0 million, and the carrying amount of the liability component was $1,070.0 million, which was recorded to long-term debt within the Company’s consolidated balance sheet as reflected in the table above within this Note. As of December 31, 2016, the outstanding principal on the Convertible Notes was $1.15 billion, the unamortized debt discount and debt issuance costs was $125.2 million, and the carrying amount of the liability component was $1,024.8 million, which was recorded to long-term debt within the Company’s balance sheet as reflected in the table above within this Note. The fair value of the liability component relating to the Convertible Notes was approximately $1,066.0 million and $961.3 million as of December 31, 2017 and 2016, respectively. As of December 31, 2017 and 2016, the Company determined the fair value of the liability component of the Convertible Notes using two valuation methods. The Company reviewed market data that was available for publicly traded, senior, unsecured nonconvertible corporate bonds issued by companies with similar credit ratings. Assumptions used in the estimate represent what market participants would use in pricing the liability component, including market yields and credit standing to develop the straight debt yield estimate. The Company also used a lattice model, which included inputs such as stock price, the Convertible Note trading price, volatility and dividend yield to estimate the straight debt yield. The Company combined the results of the two valuation methods to determine the fair value of the liability component of the Convertible Notes. Most of these inputs are primarily considered Level 2 and Level 3 inputs. This valuation approach was similar to the approach the Company used to determine the initial fair value of the liability component of the Convertible Notes on the February 7, 2014 issuance date. In conjunction with the issuance of the Convertible Notes, during February 2014, the Company paid approximately $685.8 million to enter into prepaid forward share repurchase transactions, or the Forward Transactions, with certain financial institutions, and paid approximately $123.8 million to enter into capped call transactions with respect to its common shares, or the Capped Call Transactions, with certain financial institutions. See Note 8, Shareholders’ (Deficit) Equity During the years ended December 31, 2017, 2016, and 2015, the Company recognized $68.2 million, $65.3 million, and $61.7 million of interest expense relating to the Convertible Notes, respectively, which included $41.2 million, $38.6 million, and $35.7 million relating to non-cash interest expense relating to the debt discount, respectively, and $4.0 million, $3.8 million, $3.2 million relating to amortization of debt issuance costs, respectively. Total Debt The Company’s total interest expense, including the Credit Facility, was $160.8 million, $99.3 million, and $100.5 million, for the years ended December 31, 2017, 2016, and 2015, respectively, which was recognized within its consolidated statement of income. As of December 31, 2017, annual scheduled principal payments of debt were as follows (in millions): Principal Payments 2018 $ 102.4 2019 1,250.0 2020 97.9 2021 97.5 2022 97.5 Thereafter 739.4 Total $ 2,384.7 Certain vendors and government agencies may require letters of credit or similar guaranteeing arrangements to be issued or executed. As of December 31, 2017, the Company had $40.8 million of issued but undrawn letters of credit or similar arrangements, which included the Mexico Value Added Tax, or VAT, related surety bonds described in Note 7, Contingencies |
Lease Obligations
Lease Obligations | 12 Months Ended |
Dec. 31, 2017 | |
Leases [Abstract] | |
Lease Obligations | 5. Lease Obligations The Company has warehouse, office, furniture, fixtures and equipment leases, which expire at various dates through 2033. Under the lease agreements, the Company is also obligated to pay property taxes, insurance and maintenance costs. Certain leases contain renewal options. Future minimum rental commitments for non-cancelable operating leases as of December 31, 2017 were as follows (in millions): Operating 2018 $ 51.6 2019 42.7 2020 30.2 2021 17.7 2022 13.6 Thereafter 73.2 Total $ 229.0 The Company recognizes rental expense on a straight-line basis. Rental expense for the years ended December 31, 2017, 2016, and 2015, was $56.2 million, $53.4 million, and $58.0 million, respectively. There was no material property, plant and equipment under capital leases included in property, plant and equipment on the accompanying consolidated balance sheets as of December 31, 2017 and December 31, 2016. |
Employee Compensation Plans
Employee Compensation Plans | 12 Months Ended |
Dec. 31, 2017 | |
Postemployment Benefits [Abstract] | |
Employee Compensation Plans | 6. Employee Compensation Plans In the United States, the Company maintains a profit sharing plan pursuant to Sections 401(a) and (k) of the Internal Revenue Code of 1986, as amended, or the Code. The plan is available to substantially all employees who meet the length of service requirements. The Company’s contribution expense relating to this profit sharing plan was $4.8 million, $4.8 million, and $4.3 million during the years ended December 31, 2017, 2016, and 2015, respectively. The Company has employees in international countries that are covered by various deferred compensation plans. These plans are administered based upon the legal requirements in the countries in which they are established. The Company’s compensation expenses relating to these plans were $6.4 million, $5.8 million, and $5.5 million for the years ended December 31, 2017, 2016, and 2015, respectively. The Company has non-qualified deferred compensation plans for select groups of management: the Herbalife Management Deferred Compensation Plan and the Herbalife Senior Executive Deferred Compensation Plan. The matching contribution was 3.5% of a participant’s annual base salary in excess of the Qualified Plan annual compensation limit and the amount by which deferrals reduce 401(k) eligible pay below the IRS limit. Each participant in either of the non-qualified deferred compensation plans discussed above has, at all times, a fully vested and non-forfeitable interest in each year’s contribution, including interest credited thereto, and in any Company matching contributions, if applicable. In connection with a participant’s election to defer an annual deferral amount, the participant may also elect to receive a short-term payout, equal to the annual deferral amount plus interest. Such amount is payable in five or more years from the first day of the year in which the annual deferral amount is actually deferred. The total expense for the two non-qualified deferred compensation plans, excluding participant contributions, was $6.7 million, $3.6 million, and $0.1 million for the years ended December 31, 2017, 2016, and 2015, respectively. The total long-term deferred compensation liability under the two deferred compensation plans was $58.1 million and $50.0 million as of December 31, 2017 and 2016, respectively, and are included in other non-current liabilities within the Company’s consolidated balance sheets. The deferred compensation plans are unfunded and their benefits are paid from the general assets of the Company, except that the Company has contributed to a “rabbi trust” whose assets will be used to pay the benefits if the Company remains solvent, but can be reached by the Company’s creditors if the Company becomes insolvent. The value of the assets in the “rabbi trust” was $33.6 million and $30.6 million as of December 31, 2017 and 2016, respectively, and are included in other assets within the Company’s consolidated balance sheets. |
Contingencies
Contingencies | 12 Months Ended |
Dec. 31, 2017 | |
Commitments And Contingencies Disclosure [Abstract] | |
Contingencies | 7. Contingencies The Company is from time to time engaged in routine litigation. The Company regularly reviews all pending litigation matters in which it is involved and establishes reserves deemed appropriate by management for these litigation matters when a probable loss estimate can be made. These matters described in this Note may take several years to resolve. While the Company believes it has meritorious defenses, it cannot be sure of their ultimate resolution. Although the Company may reserve amounts for certain matters that the Company believes represent the most likely outcome of the resolution of these related disputes, if the Company is incorrect in its assessment, the Company may have to record additional expenses, when it becomes probable that an increased potential liability is warranted. Tax Matters On May 7, 2010, the Company received an assessment from the Mexican Tax Administration Service in an amount equivalent to approximately $58.3 million, translated at the December 31, 2017 spot rate, for various items, the majority of which was VAT allegedly owed on certain of the Company’s products imported into Mexico during the years 2005 and 2006. This assessment is subject to interest and inflationary adjustments. On July 8, 2010, the Company initiated a formal administrative appeal process. On May 13, 2011, the Mexican Tax Administration Service issued a resolution on the Company’s administrative appeal. The resolution nullified the assessment. Since the Mexican Tax Administration Service can further review the tax audit findings and re-issue some or all of the original assessment, the Company commenced litigation in the Tax Court of Mexico in August 2011 to dispute the assertions made by the Mexican Tax Administration Service in the case. The Company received notification on February 6, 2015 that the Tax Court of Mexico nullified substantially all of the assessment. On March 18, 2015, the Mexican Tax Administration Service filed an appeal against the verdict with the Circuit Court. On August 27, 2015, the Circuit Court remanded the case back to the Tax Court of Mexico to reconsider a portion of the procedural decision that was adverse to the Mexican Tax Administration Service. The Company received notification on March 18, 2016 that the Tax Court of Mexico nullified a portion of the assessment and upheld a portion of the original assessment. On August 25, 2016, the Company filed a further appeal of this decision to the Circuit Court. On April 6, 2017, the Circuit Court issued a verdict with the Company prevailing on some lesser issues and the Tax Administration Service prevailing on the core issue. On May 11, 2017, the Company filed a further appeal to the Supreme Court of Mexico. On June 14, 2017, the Supreme Court of Mexico agreed to hear the appeal. The Company believes that it has meritorious defenses if the assessment is reissued. The Company has not recognized a loss as the Company does not believe a loss is probable. The Mexican Tax Administration Service commenced audits of the Company’s Mexican subsidiaries for the period from January to September 2007 and on May 10, 2013, the Company received an assessment of approximately $14.9 million, translated at the December 31, 2017 spot rate, related to that period. This assessment is subject to interest and inflationary adjustments. On July 11, 2013, the Company filed an administrative appeal disputing the assessment. On September 22, 2014, the Mexican Tax Administration Service denied the Company’s administrative appeal. The Company commenced litigation in the Tax Court of Mexico in November 2014 to dispute the assertions made by the Mexican Tax Administration Service in the case. On January 16, 2018, the Tax Court of Mexico issued a verdict upholding the assessment issued by the Mexican Tax Administration Service. The Company intends to file a timely appeal of the case to the Circuit Court of Appeals. Litigation in this case is currently ongoing. The Company has not recognized a loss as the Company does not believe a loss is probable. The Company issued a surety bond in the amount of $17.6 million, translated at the December 31, 2017 spot rate, through an insurance company to guarantee payment of the tax assessment as required while the Company pursues an appeal of the assessment, and the surety bond remained effective as of December 31, 2017. The Mexican Tax Administration Service has delayed processing VAT refunds for companies operating in Mexico and the Company believes that the process for its Mexico subsidiary to receive VAT refunds may be delayed. As of December 31, 2017, the Company had $41.2 million of Mexico VAT related assets, of which $35.3 million was within non-current other assets and $5.9 million was within prepaid expenses and other current assets on its consolidated balance sheet. This amount relates to VAT payments made over various periods and the Company believes these amounts are recoverable by refund or they may be applied against certain future tax liabilities. The Company has not recognized any losses related to these VAT related assets as the Company does not believe a loss is probable. On March 26, 2015, the Office of the President of Mexico issued a decree relating to the application of VAT to nutritional supplements. The Company continues to believe its application of the VAT law in Mexico is correct. As of December 31, 2017, the Company has not recognized any losses as the Company, based on its current analysis and guidance from its advisors, does not believe a loss is probable. The Company continues to evaluate and monitor its situation as it develops, including whether it will make any changes to its operations in Mexico. The Company has not recognized a loss with respect to any of these Mexican matters as the Company, based on its analysis and guidance from its advisors, does not believe a loss is probable. Further, the Company is currently unable to reasonably estimate a possible loss or range of loss that could result from an unfavorable outcome if an assessment was re-issued or any additional assessments were to be issued for these or other periods. The Company believes that it has meritorious defenses if an assessment is re-issued or would have meritorious defenses if any additional assessment is issued. As previously disclosed, the Mexican Tax Administration Service has requested information related to the Company’s 2010 year. This information has been provided and the Tax Administration Service has now completed its income tax audit related to the 2010 year. The audit resulted in an insignificant assessment which the Company has paid. The Company does not plan to appeal the case. The Company received a tax assessment in September 2009 from the Federal Revenue Office of Brazil in an amount equivalent to approximately $2.1 million, translated at the December 31, 2017 spot rate, related to withholding/contributions based on payments to the Company’s Members during 2004. On December 28, 2010, the Company appealed this tax assessment to the Administrative Council of Tax Appeals (2nd level administrative appeal). The Company believes it has meritorious defenses and it has not recognized a loss as the Company does not believe a loss is probable. On March 6, 2014, the Company was notified of a similar audit of the 2011 year. In January 2016, the Company received a tax assessment for an amount equivalent to approximately $5.3 million, translated at the December 31, 2017 spot rate, related to contributions based on payments to the Company’s Members during 2011. The Company filed a first level administrative appeal against most of the assessment on February 23, 2016, which was subsequently denied. On March 13, 2017, the Company appealed this tax assessment to the Administrative Council of Tax Appeals (2nd level administrative appeal). The Company has not accrued a loss for the majority of the assessment because the Company does not believe a loss is probable. The Company is currently unable to reasonably estimate the amount of the loss that may result from an unfavorable outcome if additional assessments for other periods were to be issued. The Company’s Brazilian subsidiary pays ICMS-ST taxes on its product purchases, similar to VAT. As of December 31, 2017, the Company had $11.7 million of Brazil ICMS-ST, of which $4.4 million was within non-current other assets and $7.3 million was within prepaid expenses and other current assets on its consolidated balance sheet. The Company believes it will be able to utilize or recover these ICMS-ST credits in the future. The Company is under examination in several Brazilian states related to ICMS and ICMS-ST taxation. Some of these examinations have resulted in assessments for underpaid tax that the Company has appealed. The State of Sao Paulo has audited the Company for the 2013 and 2014 tax years. During July 2016, for the State of Sao Paulo, the Company received an assessment in the aggregate amount of approximately $48.5 million, translated at the December 31, 2017 spot rate, relating to various ICMS issues for its 2013 tax year. In August 2016, the Company filed a first level administrative appeal which was denied in February 2017. The Company filed a further appeal on March 9, 2017. During August 2017, for the state of Sao Paulo, the Company received an assessment in the aggregate amount of approximately $18.0 million, translated at the December 31, 2017 spot rate, relating to various ICMS issues for its 2014 tax year. In September 2017, the Company filed a first level administrative appeal for the 2014 tax year. The Company has not recognized a loss as the Company does not believe a loss is probable. The Company has also received other ICMS tax assessments in Brazil. During the fourth quarter of 2015, the Company filed appeals with state judicial courts against three of the assessments. The Company had issued surety bonds in the aggregate amount of $13.1 million, translated at the December 31, 2017 spot rate, to guarantee payment of some of the tax assessments as required while the Company pursues the appeals. In addition, the Company has received several ICMS tax assessments in the aggregate amount of $7.3 million, translated at the December 31, 2017 spot rate, from several other Brazilian states where surety bonds have not been issued. Litigation in all these cases is currently ongoing. The Company has not recognized a loss as the Company does not believe a loss is probable. The Company has received various tax assessments in multiple states in India for multiple years from the Indian VAT authorities in an amount equivalent to approximately $8.3 million, translated at the December 31, 2017 spot rate. These assessments are for underpaid VAT. The Company is litigating these cases at the tax administrative level and the tax tribunal levels as it believes it has meritorious defenses. The Company has not recognized a loss as it does not believe a loss is probable. The Korea Customs Service audited the importation activities of Herbalife Korea for the period January 2011 through May 2013. The total assessment for the audit period is $33.2 million translated at the December 31, 2017 spot rate. The Company has paid the assessment and has recognized these payments within other assets on its consolidated balance sheet. The Company lodged a first level administrative appeal, which was denied on October 21, 2016. On January 31, 2017, the Company filed a further appeal to the National Tax Tribunal of Korea. The Company disagrees with the assertions made in the assessments, as well as the calculation methodology used in the assessments. The Company has not recognized a loss as the Company does not believe a loss is probable. During the course of 2016, the Company received various questions from the Greek Social Security Agency and on December 29, 2016, the Greek Social Security Agency issued an assessment of approximately $2.4 million translated at the December 31, 2017 spot rate, with respect to Social Security Contributions on Member earnings for the 2006 year. For Social Security issues, the Statute of Limitations is open for 2007 and later years in Greece. The Company could receive similar assessments covering other years. The Company disputes the allegations that were raised in the assessment and filed an administrative appeal against the assessment with the Greek Social Security Agency. On November 14, 2017, the Administrative Review Committee of the Greek Social Security Agency notified the Company that it had remanded the case back to the Social Security Agency auditors with an instruction to reconsider the case since the majority of the assessment seemed to be unfounded. The Company has not recognized a loss as it does not believe a loss is probable. U.S. Federal Trade Commission Consent Order On July 15, 2016, the Company and the Federal Trade Commission, or the FTC, entered into a proposed Stipulation to Entry of Order for Permanent Injunction and Monetary Judgment, or the Consent Order. The Consent Order was lodged with the U.S. District Court for the Central District of California on July 15, 2016 and became effective on July 25, 2016, or the Effective Date. The Consent Order resolved the FTC’s multi-year investigation of the Company. Pursuant to the Consent Order, under which the Company neither admitted nor denied the FTC’s allegations (except as to the Court having jurisdiction over the matter), the Company made, through its wholly owned subsidiary Herbalife International of America, Inc., a $200 million payment to the FTC. Additionally, the Company agreed to implement certain new procedures and enhance certain existing procedures in the U.S., most of which the Company had 10 months from the Effective Date to implement. Among other requirements, Other Matters As a marketer of foods, dietary and nutritional supplements, and other products that are ingested by consumers or applied to their bodies, the Company has been and is currently subjected to various product liability claims. The effects of these claims to date have not been material to the Company. The Company currently maintains product liability insurance with an annual deductible of $12.5 million. The SEC and the Department of Justice have requested from the Company documents and other information relating to the Company’s anti-corruption compliance in China and the Company is conducting its own review. The Company is cooperating with the government and cannot predict the eventual scope, duration, or outcome of these matters at this time. Since late 2012, a short seller has made and continues to make allegations regarding the Company and its network marketing program. The Company believes these allegations are without merit and has vigorously defended itself against such claims, including proactively reaching out to governmental authorities about what the Company believes is manipulative activity with respect to its securities. Because of these allegations, the Company and others have received and may receive additional regulatory and governmental inquiries. For example, the Company has previously disclosed inquiries from the FTC, SEC and other governmental authorities. In the future, governmental authorities may determine to seek information from the Company and other persons relating to these same or other allegations. If the Company believes any governmental or regulatory inquiry or investigation is or becomes material, it will be disclosed individually. Consistent with its policies, the Company has cooperated and will continue to fully cooperate with any governmental or regulatory inquiries or investigations. On September 18, 2017, the Company and certain of its subsidiaries and Members were named as defendants in a purported class action lawsuit, titled Rodgers, et al. v Herbalife Ltd., et al. and filed in the U.S. District Court for the Southern District of Florida, which alleges violations of Florida’s Deceptive and Unfair Trade Practices statute and federal Racketeer Influenced and Corrupt Organizations statutes, unjust enrichment, and negligent misrepresentation. The plaintiffs seek damages in an unspecified amount. The Company believes the lawsuit is without merit and will vigorously defend itself against the claims in the lawsuit. In September 2017, one of the Company’s warehouses located in Mexico sustained flooding which damaged certain inventory stored within the warehouse. The Company maintains insurance coverage with third party carriers on the affected property. As of December 31, 2017, the Company has recorded a loss relating to the damaged inventory and has recognized an equal offsetting receivable for insurance recoveries. This event did not have a material negative impact to its Mexico operations and the Company’s consolidated financial statements. |
Shareholders' (Deficit) Equity
Shareholders' (Deficit) Equity | 12 Months Ended |
Dec. 31, 2017 | |
Equity [Abstract] | |
Shareholders’ (Deficit) Equity | 8. Shareholders’ (Deficit) Equity The Company had 82.3 million, 93.1 million, and 92.7 million common shares outstanding as of December 31, 2017, 2016, and 2015, respectively. In December 2004, the Company authorized 7.5 million preference shares at $0.002 par value. The 7.5 million authorized preference shares remained unissued as of December 31, 2017. Preference shares may be issued from time to time in one or more series, each of such series to have such voting powers (full or limited or without voting powers), designations, preferences and relative, participating, optional or other special rights and qualifications, limitations or restrictions as determined by the Company’s board of directors. Dividends On April 28, 2014, the Company announced that its board of directors approved terminating its quarterly cash dividend and instead utilizing the cash to repurchase additional common shares. The declaration of future dividends is subject to the discretion of the Company’s board of directors and will depend upon various factors, including its earnings, financial condition, Herbalife Ltd.’s available distributable reserves under Cayman Islands law, restrictions imposed by the Credit Facility and the terms of any other indebtedness that may be outstanding, cash requirements, future prospects and other factors deemed relevant by its board of directors. Share Repurchases On February 21, 2017, the Company’s board of directors authorized a new three-year $1.5 billion share repurchase program that will expire on February 21, 2020, which replaced the Company’s prior share repurchase authorization which was set to expire on June 30, 2017 which, as of December 31, 2016, had approximately $233 million of remaining authorized capacity. This share repurchase program allows the Company, which includes an indirect wholly owned subsidiary of Herbalife Ltd., to repurchase the Company’s common shares, at such times and prices as determined by the Company’s management as market conditions warrant and to the extent Herbalife Ltd.’s distributable reserves are available under Cayman Islands law. The Credit Facility permits the Company to repurchase its common shares as long as no default or event of default exists and other conditions such as specified consolidated leverage ratios are met. In conjunction with the issuance of the Convertible Notes during February 2014, the Company paid approximately $685.8 million to enter into prepaid forward share repurchase transactions, or the Forward Transactions, with certain financial institutions, or the Forward Counterparties, pursuant to which the Company purchased approximately 9.9 million common shares , at an average cost of $69.02 per share, During the year ended December 31, 2017, an indirect wholly owned subsidiary of the Company purchased approximately 5.0 million of Herbalife Ltd.’s common shares through open market purchases at an aggregate cost of approximately $328.6 million, or an average cost of $65.61 per share. These share repurchases reduced the Company’s total shareholders’ equity and are reflected at cost within the Company’s accompanying consolidated balance sheet. Although these shares are owned by an indirect wholly owned subsidiary of the Company, they are reflected as treasury shares under U.S. GAAP and therefore reduce the number of common shares outstanding within the Company’s consolidated financial statements and the weighted-average number of common shares outstanding used in calculating earnings per share. The common shares of Herbalife Ltd. held by the indirect wholly owned subsidiary, however, remain outstanding on the books and records of the Company’s transfer agent and therefore still carry voting and other share rights related to ownership of the Company’s common shares, which may be exercised. So long as it is consistent with applicable laws, such shares will be voted by such subsidiary in the same manner, and to the maximum extent possible in the same proportion, as all other votes cast with respect to any matter properly submitted to a vote of Herbalife Ltd.’s shareholders. As of December 31, 2017, the Company held approximately 5.0 million of treasury shares for U.S. GAAP purposes. In October 2017, the Company’s parent completed its modified Dutch auction tender offer and then subsequently paid cash to repurchase and retire a total of approximately 6.7 million of its common shares at an aggregate cost of approximately $457.8 million, or $68.00 per share. In total, the Company repurchased 11.7 million of its common shares at an aggregate cost of approximately $786.4 million, or an average cost of $66.98 per share, during the year ended December 31, 2017. In connection with the tender offer, the Company incurred $1.6 million in transaction costs and also provided a non-transferable contractual CVR for each share tendered, allowing participants in the tender offer to receive a contingent cash payment in the event Herbalife is acquired in a going-private transaction (as defined in the CVR Agreement) within two years of the commencement of the tender offer. The initial fair value of the CVR was $7.3 million, which was recorded as a liability in the fourth quarter with a corresponding decrease to shareholders’ equity. In determining the initial fair value of the CVR, the Company used a lattice model, which included inputs such as the underlying stock price, strike price, time to expiration, and dividend yield. The approximate 9.9 million common shares effectively repurchased through the Forward Transactions are treated as retired shares for basic and diluted EPS purposes although they remain legally outstanding. During the years ended December 31, 2017, 2016, and 2015, the Company also withheld shares on its vested restricted stock units and exercised SARs relating to its share-based compensation plans, which are treated as share repurchases in the Company’s consolidated financial statements as discussed further below. The Company reflects the aggregate purchase price of its common shares repurchased as a reduction to (increase in) shareholders’ (deficit) equity. The Company allocated the purchase price of the repurchased shares to (accumulated deficit) retained earnings, common shares and additional paid-in capital, with the exception of treasury shares, which are recorded separately on the Company’s consolidated balance sheets. The number of shares issued upon vesting or exercise for certain restricted stock units and SARs granted pursuant to the Company’s share-based compensation plans is net of the minimum statutory withholding requirements that the Company pays on behalf of its employees. Although shares withheld are not issued, they are treated as common share repurchases in the Company’s consolidated financial statements, as they reduce the number of shares that would have been issued upon vesting. These shares do not count against the authorized capacity under the Company’s share repurchase program described above. For the years ended December 31, 2017, 2016, and 2015, the Company’s share repurchases, inclusive of transaction costs and the issuance of the CVR, were $795.3 million, none, and none, respectively, under the Company’s share repurchase programs, and $60.4 million, $13.2 million, and $16.6 million, respectively, due to shares withheld for tax purposes related to the Company’s share-based compensation plans. For the years ended December 31, 2017, 2016, and 2015, the Company’s total share repurchases, including shares withheld for tax purposes, were $855.7 million, $13.2 million, and $16.6 million, respectively, and have been recorded as a reduction to shareholders’ equity within the Company’s consolidated balance sheet as of December 31, 2017. The Company recorded $844.2 million of total share repurchases within financing activities on its consolidated statement of cash flows for the year ended December 31, 2017, which excludes the $7.3 million initial fair value of the CVR and $4.2 million of share repurchases for which payment was made subsequent to the year end and therefore reflected as a liability within the Company’s consolidated balance sheet as of December 31, 2017. Capped Call Transactions In connection with the issuance of Convertible Notes, the Company paid approximately $123.8 million to enter into capped call transactions with respect to its common shares, or the Capped Call Transactions, with certain financial institutions. The Capped Call Transactions are expected generally to reduce the potential dilution upon conversion of the Convertible Notes in the event that the market price of the common shares is greater than the strike price of the Capped Call Transactions, initially set at $86.28 per common share, with such reduction of potential dilution subject to a cap based on the cap price initially set at $120.79 per common share. The strike price and cap price are subject to certain adjustments under the terms of the Capped Call Transactions. Therefore, as a result of executing the Capped Call Transactions, the Company in effect will only be exposed to potential net dilution once the market price of its common shares exceeds the adjusted cap price. As a result of the Capped Call Transactions, the Company’s additional paid-in capital within shareholders’ (deficit) equity on its consolidated balance sheet was reduced by $123.8 million during the first quarter of 2014. Accumulated Other Comprehensive Income (Loss) The following table summarizes changes in accumulated other comprehensive income (loss) during the years ended December 31, 2017, 2016, and 2015: Changes in Accumulated Other Comprehensive Income (Loss) by Component Foreign Currency Translation Adjustments Unrealized Gain (Loss) Derivatives Other Total (In millions) Balance as of December 31, 2014 $ (96.4 ) $ 18.0 $ 0.2 $ (78.2 ) Other comprehensive income (loss) before reclassifications, net of tax (86.6 ) 15.4 (1.7 ) (72.9 ) Amounts reclassified from accumulated other comprehensive income (loss) to income, net of tax(1) — (16.0 ) 1.6 (14.4 ) Total other comprehensive income (loss), net of reclassifications (86.6 ) (0.6 ) (0.1 ) (87.3 ) Balance as of December 31, 2015 $ (183.0 ) $ 17.4 $ 0.1 $ (165.5 ) Other comprehensive income (loss) before reclassifications, net of tax (32.5 ) 8.4 — (24.1 ) Amounts reclassified from accumulated other comprehensive income (loss) to income, net of tax(1) — (15.4 ) (0.1 ) (15.5 ) Total other comprehensive income (loss), net of reclassifications (32.5 ) (7.0 ) (0.1 ) (39.6 ) Balance as of December 31, 2016 $ (215.5 ) $ 10.4 $ — $ (205.1 ) Other comprehensive income (loss) before reclassifications, net of tax 44.9 (7.9 ) — 37.0 Amounts reclassified from accumulated other comprehensive income (loss) to income, net of tax(1) — 2.7 — 2.7 Total other comprehensive income (loss), net of reclassifications 44.9 (5.2 ) — 39.7 Balance as of December 31, 2017 $ (170.6 ) $ 5.2 $ — $ (165.4 ) (1) See Note 2, Basis of Presentation Derivative Instruments and Hedging Activities Other comprehensive income (loss) before reclassifications was net of tax expense of $5.7 million for foreign currency translation adjustments for the year ended December 31, 2017. Other comprehensive income (loss) before reclassifications was net of tax expense of $5.2 million and tax benefits of $0.3 million for foreign currency translation adjustments and unrealized gain (loss) on derivatives, respectively, for the year ended December 31, 2016. Amounts reclassified from accumulated other comprehensive income (loss) to income was net of tax expense of $0.1 million for unrealized gain (loss) on available-for-sale investments for the year ended December 31, 2016. Other comprehensive income (loss) before reclassifications was net of tax benefits of $7.2 million, $0.6 million, and $0.9 million for foreign currency translation adjustments, unrealized gain (loss) on derivatives, and unrealized gain (loss) on available-for-sale investments, respectively, for the year ended December 31, 2015. Amounts reclassified from accumulated other comprehensive income (loss) to income was net of tax expense of $0.8 million for unrealized gain (loss) on available-for-sale investments for the year ended December 31, 2015. |
Share-Based Compensation
Share-Based Compensation | 12 Months Ended |
Dec. 31, 2017 | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | |
Share-Based Compensation | 9. Share-Based Compensation The Company has four share-based compensation plans: the Amended and Restated Herbalife Ltd. 2005 Stock Incentive Plan, or the 2005 Stock Incentive Plan, the Amended and Restated Herbalife Ltd. 2014 Stock Incentive Plan, or the 2014 Stock Incentive Plan, the Amended and Restated Herbalife Ltd. Independent Directors Deferred Compensation and Stock Unit Plan, or the Independent Director Stock Unit Plan, and the Amended and Restated Non-Management Directors Compensation Plan, or the Non-Management Directors Plan. The 2014 Stock Incentive Plan replaced the 2005 Stock Incentive Plan and after the adoption thereof, no additional awards were made under the 2005 Stock Incentive Plan. The terms of the 2014 Stock Incentive Plan are substantially similar to the terms of the 2005 Stock Incentive Plan. The 2014 Stock Incentive Plan authorizes the issuance of 8,700,000 common shares pursuant to awards granted under the plan, plus any shares that remained available for issuance under the 2005 Stock Incentive Plan as of April 29, 2014. The purpose of the Independent Directors Stock Unit Plan and the Non-Management Directors Plan is to facilitate equity ownership in the Company by its directors through equity awards. As of December 31, 2017, an aggregate of approximately 4.2 million common shares remain available for future issuance under the 2014 Stock Incentive Plan. The Company’s share-based compensation plans provide for grants of stock options, stock appreciation rights, or SARs, and stock unit awards, which are collectively referred to herein as awards. Previously, stock options generally vested quarterly over a five-year period or less, beginning on the grant date. Certain SARs generally vest annually over a three-year period. The contractual term of stock options and SARs is generally ten years. Certain stock unit awards under the 2014 Stock Incentive Plan vest annually over a three year period. Certain stock unit awards subject to service and performance conditions vest after the passage of a performance period as determined by the compensation committee of the Company’s board of directors. Stock unit awards granted to directors generally vest over a one-year period. Awards can be subject to the following: market and service conditions, or market condition awards; performance and service conditions, or performance condition awards; market, service and performance conditions, or market and performance condition awards; or be subject only to continued service with the Company, or service condition awards. All awards granted by the Company are market condition awards, performance condition awards, market and performance condition awards, or service condition awards. Unless otherwise determined at the time of grant, upon vesting, each stock unit award represents the right to receive one common share. The Company’s stock compensation awards outstanding as of December 31, 2017 include SARs and stock unit awards. During the years ended December 31, 2017, 2016, and 2015, the Company granted SARs with performance conditions to certain employees. These awards generally vest 20% in the first succeeding year, 20% in the second succeeding year, and 60% in the third succeeding year, subject to achievement of certain sales leader retention metrics. The fair value of these SARs was determined on the date of grant using the Black-Scholes-Merton option pricing model. The compensation expense for these grants is recognized over the vesting term using the graded vesting method. During the years ended December 31, 2017, 2016, and 2015, the Company granted SARs with service conditions to certain employees. The fair value of these SARs was determined on the date of grant using the Black-Scholes-Merton option pricing model. The compensation expense for these grants is recognized over the vesting term using the straight line method. During the year ended December 31, 2017, the Company granted performance stock unit awards to certain executives, which will vest on December 31, 2019 subject to their continued employment through that date and the achievement of certain performance conditions. The performance conditions include targets for Volume Points, adjusted earnings before interest and taxes, and adjusted earnings per share. These performance stock unit awards can vest at between 0% and 200% of the target award based on the achievement of the performance conditions. During the year ended December 31, 2017, the Company granted stock unit awards with service conditions to directors and certain employees. Share-based compensation expense is included in selling, general and administrative expenses in the consolidated statements of income. For the years ended December 31, 2017, 2016, and 2015, share-based compensation expense relating to service condition awards amounted to $24.4 million, $23.9 million, and $26.8 million, respectively. For the years ended December 31, 2017, 2016, and 2015, share-based compensation expense relating to market condition awards amounted to $1.3 million, $0.4 million, and $0.3 million, respectively. For the years ended December 31, 2017, 2016, and 2015, share-based compensation expense relating to performance condition awards amounted to $16.4 million, $15.9 million, and $17.8 million, respectively. No share-based compensation expense related to market and performance condition awards was recognized in the years ended December 31, 2017, 2016, and 2015. For the years ended December 31, 2017, 2016, and 2015, the related income tax benefits recognized in earnings for all awards amounted to $9.4 million, $14.8 million, and $16.6 million, respectively. As of December 31, 2017, the total unrecognized compensation cost related to non-vested service condition stock awards was $29.2 million and the related weighted-average period over which it is expected to be recognized is approximately 1.4 years. As of December 31, 2017, the total unrecognized compensation cost related to non-vested performance condition awards was $15.1 million and the related weighted-average period over which it is expected to be recognized is approximately 1.7 years. As of December 31, 2017, the total unrecognized compensation cost related to non-vested market condition stock awards was less than $0.1 million and the related weighted-average period over which it is expected to be recognized is approximately 0.2 years. Stock unit awards are valued at the market value on the date of grant. The fair value of service condition SARs and performance condition SARs are estimated on the date of grant using the Black-Scholes-Merton option-pricing model. The fair value of SARs with market conditions or with market and performance conditions are estimated on the date of grant using the Monte Carlo lattice model. The Company calculates the expected term of its SARs based on historical data. All groups of employees have been determined to have similar historical exercise patterns for valuation purposes. The expected volatility of the SARs is based upon the historical volatility of the Company’s common shares and is also validated against the volatility rates of a peer group of companies. The risk free interest rate is based on the implied yield on a U.S. Treasury zero-coupon issue with a remaining term equal to the expected term of the SARs. The expected dividend yield assumption is based on the Company’s historical and expected amount of dividend payouts. There were no stock options granted during the years ended December 31, 2017, 2016, and 2015. There were no SARs granted to independent directors during the years ended December 31, 2017, 2016, and 2015. The following table summarizes the weighted average assumptions used in the calculation of the fair value for service condition awards for the years ended December 31, 2017, 2016, and 2015: SARs Year Ended December 31, 2017 2016 2015 Expected volatility 49.2 % 49.6 % 48.7 % Dividends yield 0.0 % 0.1 % 1.6 % Expected term 6.0 years 6.0 years 5.8 years Risk-free interest rate 2.2 % 1.2 % 1.6 % The following table summarizes the weighted average assumptions used in the calculation of the fair value for performance condition awards granted during the years ended December 31, 2017, 2016, and 2015: SARs Year Ended December 31, 2017 2016 2015 Expected volatility 49.6 % 49.6 % 48.8 % Dividends yield 0.0 % 0.0 % 1.6 % Expected term 6.1 years 6.0 years 5.8 years Risk-free interest rate 2.2 % 1.2 % 1.6 % The following tables summarize the activity under all share-based compensation plans, which includes all stock awards, for the year ended December 31, 2017: Stock Options & SARs Awards Weighted Average Exercise Weighted Average Remaining Contractual Term Aggregate Intrinsic Value(1) (In thousands) (In millions) Outstanding as of December 31, 2016(2) (3) 11,998 $ 41.52 6.0 years $ 148.7 Granted 1,362 $ 57.33 Exercised (3,394 ) $ 31.86 Forfeited (369 ) $ 53.59 Outstanding as of December 31, 2017(2) (3) 9,597 $ 46.72 6.2 years $ 212.0 Exercisable as of December 31, 2017(4) 5,438 $ 46.30 4.8 years $ 126.9 (1) The intrinsic value is the amount by which the current market value of the underlying stock exceeds the exercise price of the stock award. (2) Includes 0.1 million and 0.1 million market condition SARS as of December 31, 2017 and 2016, respectively. (3) Includes 3.1 million and 2.9 million performance condition SARs as of December 31, 2017 and 2016, respectively. (4) Includes 1.5 million performance condition SARs. The weighted-average grant date fair value of service condition SARs granted during the years ended December 31, 2017, 2016, and 2015 was $28.64, $29.33, and $12.57, respectively. The weighted-average grant date fair value of SARs with performance conditions granted during the years ended December 31, 2017, 2016, and 2015 was $28.32, $29.69, and $13.65, respectively. The total intrinsic value of service condition stock options and SARs exercised during the years ended December 31, 2017, 2016, and 2015 was $122.8 million, $32.3 million, and $25.5 million, respectively. The total intrinsic value of performance condition SARs exercised during the years ended December 31, 2017, and 2016 was $3.1 million and $0.7 million, respectively. The total intrinsic value of market condition SARS exercised during the year ended December 31, 2015 was $11.4 million. There were no market condition SARS exercised during the years ended December 31, 2017 and 2016. The following table summarizes the activities for stock units, primarily relating to directors of the Company, for the year ended Incentive Plan and Independent Directors Stock Units Shares Weighted Average Grant Date Fair Value (In thousands) Outstanding and nonvested as of December 31, 2016 26 $ 62.35 Granted(1) 162 $ 68.74 Vested (25 ) $ 62.40 Forfeited — Outstanding and nonvested as of December 31, 2017 163 $ 68.69 (1 ) This includes 134,388 performance based stock unit awards which represents the maximum amount that can vest. The total vesting date fair value of stock units which vested during the years ended December 31, 2017, 2016, and 2015 was $2.0 million, $2.1 million, and $1.3 million, respectively. Employee Stock Purchase Plan During 2007, the Company adopted a qualified employee stock purchase plan, or ESPP, which was implemented during the first quarter of 2008. In connection with the adoption of the ESPP, the Company has reserved for issuance a total of 2 million common shares. As of December 31, 2017, approximately 1.7 million common shares remain available for future issuance. Under the terms of the ESPP, rights to purchase common shares may be granted to eligible qualified employees subject to certain restrictions. The ESPP enables the Company’s eligible employees, through payroll withholdings, to purchase a limited number of common shares at 85% of the fair market value of a common share at the purchase date. Purchases are made on a quarterly basis. |
Segment Information
Segment Information | 12 Months Ended |
Dec. 31, 2017 | |
Segment Reporting [Abstract] | |
Segment Information | 10. Segment Information The Company is a nutrition company that sells a wide range of weight management, targeted nutrition, energy, sports & fitness, and outer nutrition products. The Company’s products are manufactured by the Company in its Changsha, Hunan, China extraction facility, Suzhou, China facility, Nanjing, China Facility, Lake Forest, California facility, and Winston-Salem, North Carolina facility, and by third party providers, and then are sold to Members who consume and sell Herbalife products to retail consumers or other Members. Revenues reflect sales of products by the Company to its Members and are categorized based on geographic location. As of December 31, 2017, the Company sold products in 94 countries throughout the world and was organized and managed by six geographic regions: North America, Mexico, South & Central America, EMEA (Europe, Middle East, and Africa), Asia Pacific and China The Company defines its operating segments as those geographical operations. he Company reviews its net sales and contribution margin by operating segment, and reviews its assets and capital expenditures on a consolidated basis and not by operating segment. Therefore, net sales and contribution margin are presented by reportable segment and assets and capital expenditures by segment are not presented. Year Ended December 31, 2017 2016 2015 (In millions) Net Sales: Primary Reporting Segment $ 3,541.8 $ 3,619.6 $ 3,622.8 China 885.9 868.8 846.2 Total Net Sales $ 4,427.7 $ 4,488.4 $ 4,469.0 Contribution Margin(1): Primary Reporting Segment $ 1,534.2 $ 1,571.9 $ 1,598.8 China(2) 790.7 789.3 762.8 Total Contribution Margin $ 2,324.9 $ 2,361.2 $ 2,361.6 Selling, general and administrative expense(2) 1,758.6 1,966.9 1,784.5 Other operating income (50.8 ) (63.8 ) (6.5 ) Interest expense 160.8 99.3 100.5 Interest income 14.5 5.9 5.6 Other expense, net (0.4 ) — 2.3 Income before income taxes 471.2 364.7 486.4 Income taxes 257.3 104.7 147.3 Net Income $ 213.9 $ 260.0 $ 339.1 Year Ended December 31, 2017 2016 2015 (In millions) Net sales by product line: Weight Management $ 2,842.5 $ 2,864.5 $ 2,862.8 Targeted Nutrition 1,082.8 1,062.8 1,015.4 Energy, Sports & Fitness 263.8 268.4 250.9 Outer Nutrition 93.9 110.4 133.0 Literature, Promotional and Other(3) 144.7 182.3 206.9 Total Net Sales $ 4,427.7 $ 4,488.4 $ 4,469.0 Net sales by geographic area: United States $ 818.3 $ 935.0 $ 860.0 Mexico 442.7 446.6 479.9 China 885.9 868.8 846.2 Others 2,280.8 2,238.0 2,282.9 Total Net Sales $ 4,427.7 $ 4,488.4 $ 4,469.0 (1) Contribution margin consists of net sales less cost of sales and royalty overrides. For the China segment, contribution margin does not include service fees to China independent service providers. (2) Service fees to China independent service providers totaling $419.5 million, $407.1 million, and $403.5 million for the years ended December 31, 2017, 2016, and 2015, respectively, are included in selling, general and administrative expenses. (3) Product buy backs and returns in all product categories are included in literature, promotional and other category. As of December 31, 2017 and 2016, goodwill allocated to the Company’s reporting units included in the Company’s Primary Reporting Segment was $93.6 million and $86.8 million, respectively. Goodwill allocated to the China segment was $3.3 million and $3.1 million as of December 31, 2017 and 2016, respectively. The following table sets forth property, plant and equipment and deferred tax assets by geographic area: December 31, 2017 2016 2015 (In millions) Property, Plant and Equipment, net: United States $ 289.8 $ 290.7 $ 264.2 Foreign 87.7 87.3 75.0 Total Property, Plant and Equipment, net $ 377.5 $ 378.0 $ 339.2 Deferred Tax Assets: United States $ 103.6 $ 218.7 $ 188.5 Foreign 70.9 62.5 63.9 Total Deferred Tax Assets $ 174.5 $ 281.2 $ 252.4 The majority of the Company’s foreign subsidiaries designate their local currencies as their functional currency. As of December 31, 2017 and 2016, the total amount of cash held by foreign subsidiaries reported in the Company’s consolidated balance sheets was $1,133.5 million and $316.2 million, respectively, of which $633.3 million and $28.2 million, respectively, was maintained or invested in U.S. dollars. As of December 31, 2017 and 2016, the total amount of cash and cash equivalents held by the Company’s parent and its U.S. entities, inclusive of U.S. territories, was $145.3 million and $527.8 million, respectively. |
Derivative Instruments and Hedg
Derivative Instruments and Hedging Activities | 12 Months Ended |
Dec. 31, 2017 | |
Derivative Instruments And Hedging Activities Disclosure [Abstract] | |
Derivative Instruments and Hedging Activities | 11. Derivative Instruments and Hedging Activities Foreign Currency Instruments The Company designates certain foreign currency derivatives, primarily comprised of foreign currency forward contracts, as freestanding derivatives for which hedge accounting does not apply. The changes in the fair market value of these freestanding derivatives are included in selling, general and administrative expenses in the Company’s consolidated statements of income. The Company uses freestanding foreign currency derivatives to hedge foreign-currency-denominated intercompany transactions and to partially mitigate the impact of foreign currency fluctuations. The fair value of the freestanding foreign currency derivatives is based on third-party quotes. The Company’s foreign currency derivative contracts are generally executed on a monthly basis. The Company designates as cash-flow hedges those foreign currency forward contracts it enters into to hedge forecasted inventory purchases and intercompany management fees that are subject to foreign currency exposures. Forward contracts are used to hedge forecasted inventory purchases over specific months. Changes in the fair value of these forward contracts, excluding forward points, designated as cash-flow hedges are recorded as a component of accumulated other comprehensive income (loss) within shareholders’ (deficit) equity, and are recognized in cost of sales in the consolidated statement of income during the period which approximates the time the hedged inventory is sold. The Company also hedges forecasted intercompany management fees over specific months. These contracts allow the Company to sell Euros in exchange for U.S. dollars at specified contract rates. Changes in the fair value of these forward contracts designated as cash flow hedges are recorded as a component of accumulated other comprehensive income (loss) within shareholders’ (deficit) equity, and are recognized in selling, general and administrative expenses in the consolidated statement of income during the period when the hedged item and underlying transaction affect earnings. As of December 31, 2017 and December 31, 2016, the aggregate notional amounts of all foreign currency contracts outstanding designated as cash flow hedges were approximately $104.9 million and $90.0 million, respectively. As of December 31, 2017, these outstanding contracts were expected to mature over the next fifteen months. The Company’s derivative financial instruments are recorded on the consolidated balance sheets at fair value based on third-party quotes. As of December 31, 2017, the Company recorded assets at fair value of $2.9 million and liabilities at fair value of $4.0 million relating to all outstanding foreign currency contracts designated as cash-flow hedges. As of December 31, 2016, the Company recorded assets at fair value of $4.6 million relating to all outstanding foreign currency contracts designated as cash-flow hedges. The Company assesses hedge effectiveness and measures hedge ineffectiveness at least quarterly. During the years ended December 31, 2017, and 2016, the ineffective portion relating to these hedges was immaterial and the hedges remained effective as of December 31, 2017, and December 31, 2016. As of December 31, 2017 and December 31, 2016, the majority of the Company’s outstanding foreign currency forward contracts had maturity dates of less than twelve months with the majority of freestanding derivatives expiring within one month as of both December 31, 2017 and December 31, 2016. The table below describes all foreign currency forward contracts that were outstanding as of December 31, 2017 and December 31, 2016: Foreign Currency Average Contract Rate Original Notional Fair Value Gain (Loss) (In millions) (In millions) As of December 31, 2017 Buy Argentine peso sell Euro 21.40 $ 0.5 $ — Buy Australian dollar sell Euro 1.55 0.9 — Buy Canadian dollar sell Euro 1.52 0.5 — Buy Chilean peso sell Euro 749.55 0.6 — Buy Chinese yuan sell Euro 8.03 25.9 0.4 Buy Euro sell Argentine peso 21.46 0.5 — Buy Euro sell Australian dollar 1.56 4.8 (0.1 ) Buy Euro sell Canadian dollar 1.52 0.5 — Buy Euro sell Chilean peso 749.35 1.1 — Buy Euro sell Chinese yuan 7.84 26.5 0.2 Buy Euro sell Ghana cedi 5.61 3.0 (0.1 ) Buy Euro sell Hong Kong dollar 9.26 6.8 0.1 Buy Euro sell Indonesian rupiah 16,113.59 11.5 0.1 Buy Euro sell Japanese yen 133.88 0.4 — Buy Euro sell Kazakhstani tenge 401.40 1.7 — Buy Euro sell Mexican peso 22.65 59.1 3.6 Buy Euro sell Malaysian ringgit 4.84 1.6 — Buy Euro sell Peruvian nuevo sol 3.85 4.9 — Buy Euro sell Philippine peso 60.03 5.3 — Buy Euro sell Russian ruble 70.38 10.8 (0.1 ) Buy Euro sell Thai baht 38.33 1.3 — Buy Euro sell Taiwan dollar 35.59 0.6 — Buy Euro sell U.S. dollar 1.18 59.1 0.9 Buy Euro sell South African rand 16.37 3.8 (0.3 ) Buy British pound sell Euro 0.88 3.4 (0.1 ) Buy British pound sell U.S. dollar 1.35 2.8 — Buy Hong Kong dollar sell Euro 9.31 3.0 — Buy Indonesian rupiah sell Euro 16,164.33 4.8 — Buy Indonesian rupiah sell U.S. dollar 13,676.00 6.2 — Buy Korean won sell U.S. dollar 1,077.18 5.4 0.1 Buy Kazakhstani tenge sell U.S. dollar 338.75 0.9 — Buy Mexican peso sell Euro 22.97 7.1 (0.2 ) Buy Malaysian ringgit sell Euro 4.90 0.5 — Buy Norwegian krone sell U.S. dollar 8.26 1.2 — Buy Peruvian nuevo sol sell Euro 3.85 2.3 — Buy Russian ruble sell Euro 70.47 4.4 0.1 Buy Swedish krona sell U.S. dollar 8.37 1.9 0.1 Buy Thai baht sell Euro 38.69 2.2 — Buy Taiwan dollar sell U.S. dollar 29.78 5.9 0.1 Buy U.S. dollar sell Colombian peso 2,996.00 1.0 — Buy U.S. dollar sell Euro 1.15 141.1 (5.3 ) Buy U.S. dollar sell British pound 1.34 6.8 (0.1 ) Buy U.S. dollar sell South African rand 13.93 1.9 (0.2 ) Buy South African rand sell Euro 15.18 0.9 — Total forward contracts $ 435.4 $ (0.8 ) Foreign Currency Average Contract Rate Original Notional Fair Value Gain (Loss) (In millions) (In millions) As of December 31, 2016 Buy Chinese yuan sell Euro 7.51 $ 61.8 $ 1.0 Buy Colombian peso sell U.S. dollar 3,111.41 2.6 0.1 Buy Euro sell Australian dollar 1.46 1.7 — Buy Euro sell Chilean peso 723.80 1.0 — Buy Euro sell Hong Kong dollar 8.11 13.4 0.1 Buy Euro sell Indonesian rupiah 14,394.40 9.4 (0.1 ) Buy Euro sell Japanese yen 122.54 0.6 — Buy Euro sell Mexican peso 22.01 52.2 1.2 Buy Euro sell Peruvian nuevo sol 3.61 3.9 (0.1 ) Buy Euro sell Philippine peso 53.11 5.4 (0.1 ) Buy Euro sell Russian ruble 68.37 5.6 (0.3 ) Buy Euro sell U.S. dollar 1.08 74.5 (1.5 ) Buy Euro sell South African rand 15.02 3.4 (0.1 ) Buy British pound sell Euro 0.84 3.1 — Buy Hong Kong dollar sell Euro 8.11 11.9 (0.1 ) Buy Indonesian rupiah sell Euro 14,222.02 3.9 — Buy Korean won sell U.S. dollar 1,167.30 5.0 (0.2 ) Buy Kazakhstani tenge sell U.S. dollar 342.00 0.9 — Buy Mexican peso sell Euro 21.30 11.9 (0.3 ) Buy Norwegian krone sell U.S. dollar 8.70 1.1 — Buy Peruvian nuevo sol sell Euro 3.57 1.0 — Buy Philippine peso sell Euro 52.42 1.7 — Buy Russian ruble sell Euro 67.50 3.2 0.1 Buy Swedish krona sell U.S. dollar 9.17 0.8 — Buy Taiwan dollar sell U.S. dollar 32.08 17.1 (0.1 ) Buy U.S. dollar sell Colombian peso 3,092.61 5.6 (0.1 ) Buy U.S. dollar sell Euro 1.06 140.4 4.5 Buy U.S. dollar sell Japanese yen 117.39 0.5 — Buy U.S. dollar sell South African rand 14.14 2.1 (0.1 ) Buy South African rand sell Euro 14.75 0.4 — Buy South African rand sell U.S. dollar 14.24 1.1 — Total forward contracts $ 447.2 $ 3.9 The following tables summarize the derivative activity during the years ended December 31, 2017, 2016, and 2015 relating to all the Company’s derivatives. Gains and Losses on Derivative Instruments The following table summarizes gains (losses) relating to derivative instruments recorded in other comprehensive loss during the years ended December 31, 2017, 2016, and 2015: Amount of Gain (Loss) Recognized in Other Comprehensive Loss For the Year Ended December 31, 2017 December 31, 2016 December 31, 2015 (In millions) Derivatives designated as hedging instruments: Foreign exchange currency contracts relating to inventory and intercompany management fee hedges $ (7.9 ) $ 8.1 $ 14.8 As of December 31, 2017, the estimated amount of existing net gains related to cash flow hedges recorded in accumulated other comprehensive loss that are expected to be reclassified into earnings over the next twelve months was $0.3 million. The following table summarizes gains (losses) relating to derivative instruments recorded to income during the years ended December 31, 2017, 2016, and 2015: Amount of Gain (Loss) Recognized in Income For the Year Ended December 31, 2017 December 31, 2016 December 31, 2015 Location Recognized in Income (In millions) Derivatives designated as hedging instruments: Foreign exchange currency contracts relating to inventory hedges and intercompany management fee hedges(1) $ (0.1 ) $ 0.2 $ 0.4 Selling, general and administrative expenses Derivatives not designated as hedging instruments: Foreign exchange currency contracts $ (8.6 ) $ (4.3 ) $ (4.1 ) Selling, general and administrative expenses (1) For foreign exchange contracts designated as hedging instruments, the amounts recognized in income primarily represent the amounts excluded from the assessment of hedge effectiveness for the years ended December 31, 2017 and 2016. For the year ended December 31, 2015, there was a $1.3 million benefit related to hedge ineffectiveness partially offset against a $0.9 million expense related to amounts excluded from the assessment of hedge effectiveness recognized in income (loss). The following table summarizes gains (losses) relating to derivative instruments reclassified from accumulated other comprehensive loss into income during the years ended December 31, 2017, 2016, and 2015: Amount of Gain (Loss) Reclassified from Accumulated Other Comprehensive Loss into Income Location of Gain (Loss) Reclassified For the Year Ended from December 31, 2017 December 31, 2016 December 31, 2015 Comprehensive Loss into Income (effective portion) (In millions) Derivatives designated as hedging instruments: Foreign exchange currency contracts relating to inventory hedges $ (0.5 ) $ 14.7 $ 15.8 Cost of sales Foreign exchange currency contracts relating to intercompany management fee hedges $ (2.2 ) $ 0.3 $ 0.2 Selling, general and administrative expenses The Company reports its derivatives at fair value as either assets or liabilities within its consolidated balance sheets. See Note 13, Fair Value Measurements |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2017 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | 12. Income Taxes The components of income before income taxes are as follows (in millions): Year Ended December 31, 2017 2016 2015 Domestic $ (29.0 ) $ (89.3 ) $ 80.9 Foreign 500.2 454.0 405.5 Total $ 471.2 $ 364.7 $ 486.4 Income taxes are as follows (in millions): Year Ended December 31, 2017 2016 2015 Current: Foreign $ 147.1 $ 127.9 $ 147.0 Federal 10.6 12.4 35.4 State 1.8 0.8 3.1 159.5 141.1 185.5 Deferred: Foreign (8.6 ) 12.5 (13.2 ) Federal 106.4 (47.2 ) (23.8 ) State — (1.7 ) (1.2 ) 97.8 (36.4 ) (38.2 ) $ 257.3 $ 104.7 $ 147.3 The significant categories of temporary differences that gave rise to deferred tax assets and liabilities are as follows (tax effected in millions): December 31, 2017 2016 Deferred income tax assets: Accruals not currently deductible $ 78.5 $ 85.2 Tax loss and credit carryforwards of certain foreign subsidiaries 137.6 115.1 Tax loss and domestic tax credit carryforwards 191.4 102.6 Deferred compensation plan 49.7 73.8 Accrued vacation 4.4 6.2 Inventory reserve 7.4 11.2 Other 4.9 2.5 Gross deferred income tax assets 473.9 396.6 Less: valuation allowance (299.4 ) (115.4 ) Total deferred income tax assets $ 174.5 $ 281.2 Deferred income tax liabilities: Intangible assets $ 71.1 $ 112.2 Depreciation/amortization 5.4 15.9 Unremitted foreign earnings 20.5 5.5 Other 7.7 7.7 Total deferred income tax liabilities 104.7 141.3 Total net deferred tax assets $ 69.8 $ 139.9 Tax loss and credit carryforwards of certain foreign subsidiaries for 2017 and 2016 were $137.6 million and $115.1 million, respectively. If unused, tax loss and credit carryforwards of certain foreign subsidiaries of $70.7 million will expire between 2018 and 2027 and $66.9 million can be carried forward indefinitely. U.S. foreign tax credit carryforwards for 2017 and 2016 were $186.2 million and $99.6 million, respectively. If unused, U.S. foreign tax credit carryforwards begin to expire in 2020. The domestic research and development tax credit carryforward for 2017 was $4.8 million. If unused, domestic research and development tax credit carryforwards will expire in 2037. The state tax loss carryforwards for 2017 were $0.4 million. If unused, state tax loss carryforwards will expire between 2022 and 2037. On December 22, 2017, the U.S. enacted the Tax Cuts and Jobs Act, or the Act. The Act, which is also commonly referred to as “U.S. Tax Reform,” significantly changes U.S. corporate income tax laws by, among other things, reducing the U.S. corporate income tax rate to 21% starting in 2018 and creating a modified territorial tax system with a one-time mandatory tax on previously deferred foreign earnings of U.S. subsidiaries. As a result of the Act, the Company recorded a provisional net expense of $ 153.3 million during 163.4 million charge 5.5 4.6 million For U.S. foreign tax credit purposes, the Company incurred overall domestic losses in 2017 and 2016 which limited the Company’s ability to claim foreign tax credits. In future taxable years as domestic source income is generated, no less than 50% of such income will be reclassified as foreign source income as allowed and will increase the Company’s foreign tax credit limitation, thereby enabling the use of additional foreign tax credits. The Company believes it is more likely than not that $31.4 million of foreign tax credits, resulting from the overall domestic loss, will be utilized based on the Company’s current interpretation of the Act. As described below, the Company continues to analyze the Act and related information, and accordingly the Company may record additional provisional amounts or adjustments in future periods. Although the $ 153.3 million provisional net expense represents what the Company believes is a reasonable estimate of the impact of the income tax effects of the Act The Company recognizes valuation allowances on deferred tax assets reported if, based on the weight of the evidence it is more likely than not that some or all of the deferred tax assets will not be realized. As of December 31, 2017 and 2016 the Company held valuation allowances against net deferred tax assets of certain subsidiaries, primarily related to tax loss carryforwards and U.S. foreign tax credits in the amount of $299.4 million and tax loss carryforwards of $115.4 million, respectively. The change in the Company’s valuation allowance during 2017 of $184.0 million was related to $183.7 million of net additions charged to income tax expense, primarily related to the valuation allowance established for U.S. foreign tax credits described above, and $0.3 million of currency translation adjustments recognized within other comprehensive income. The change in the Company’s valuation allowance during 2016 of $5.9 million was related to $5.6 million of net reductions charged to income tax expense and $0.3 million of currency translation adjustments recognized within other comprehensive income. The change in the Company’s valuation allowance during 2015 of $208.7 million was related to $205.6 million of net reductions charged to income tax expense, primarily related to the utilization of our deferred tax asset balance related to intercompany deferred interest expense, partially offset by increases in Venezuelan tax loss carryforwards, and $3.1 million of currency translation adjustments recognized within other comprehensive income. As of December 31, 2017, the Company’s U.S. consolidated group had approximately $97.9 million of unremitted earnings that were permanently reinvested relating to certain foreign subsidiaries. In addition, as of December 31, 2017, Herbalife Ltd. had approximately $2.4 billion of permanently reinvested unremitted earnings relating to its operating subsidiaries. Since Herbalife Ltd.’s unremitted earnings have been permanently reinvested, deferred taxes were not provided on these unremitted earnings. Further, it is not practicable to determine the amount of unrecognized deferred taxes with respect to these unremitted earnings. If the Company were to remit these unremitted earnings then it would be subject to income tax on these remittances. Deferred taxes have been accrued for earnings that are not considered indefinitely reinvested. The deferred tax on the unremitted foreign earnings as of December 31, 2017 and 2016 was a deferred tax liability of $29.1 million (net of valuation allowance) and $5.5 million, respectively. The applicable statutory income tax rate in the Cayman Islands was zero for Herbalife Ltd. for the years being reported. For purposes of the reconciliation between the provision for income taxes at the statutory rate and the provision for income taxes at the effective tax rate, a notional 35% tax rate is applied as follows: Year Ended December 31, 2017 2016 2015 (In millions) Tax expense at United States statutory rate $ 164.9 $ 127.7 $ 170.2 Increase (decrease) in tax resulting from: Differences between U.S. and foreign tax rates on foreign income, including withholding taxes (42.7 ) (16.6 ) 203.1 U.S. tax (benefit) on foreign income net of foreign tax credits (22.9 ) (10.2 ) (23.9 ) (Decrease) increase in valuation allowances 183.7 (5.6 ) (205.6 ) State taxes, net of federal benefit 1.9 0.3 1.7 Unrecognized tax benefits (4.0 ) 5.3 10.1 Excess tax benefits on equity awards (31.1 ) — — Other 7.5 3.8 (8.3 ) Total $ 257.3 $ 104.7 $ 147.3 As of December 31, 2017, the total amount of unrecognized tax benefits, including related interest and penalties was $62.0 million. If the total amount of unrecognized tax benefits was recognized, $44.4 million of unrecognized tax benefits, $9.9 million of interest and $1.5 million of penalties would impact the effective tax rate. As of December 31, 2016, the total amount of unrecognized tax benefits, including related interest and penalties was $62.0 million. If the total amount of unrecognized tax benefits was recognized, $44.8 million of unrecognized tax benefits, $9.4 million of interest and $2.1 million of penalties would impact the effective tax rate. The Company accounts for the interest and penalties generated by tax contingencies as a component of income tax expense. During the year ended December 31, 2017, the Company recorded a decrease in interest and penalty expense related to uncertain tax positions of less than $0.1 million and $0.8 million, respectively. During the year ended December 31, 2016, the Company recorded an increase in interest and penalty expense related to uncertain tax positions of $2.7 million and $0.7 million, respectively. During the year ended December 31, 2015, the Company recorded an increase in interest and penalty expense related to uncertain tax positions of $2.0 million and $0.6 million, respectively. As of December 31, 2017, total amount of interest and penalties related to unrecognized tax benefits recognized in the statement of financial position were $9.9 million and $1.5 million, respectively. As of December 31, 2016, total amount of interest and penalties related to unrecognized tax benefits recognized in the statement of financial position were $9.4 million and $2.1 million, respectively. As of December 31, 2015, total amount of interest and penalties related to unrecognized tax benefits recognized in the statement of financial position were $7.1 million and $1.5 million, respectively. The following changes occurred in the amount of unrecognized tax benefits during the years ended December 31, 2017, 2016, and 2015 (in millions): Year Ended December 31, 2017 2016 2015 Beginning balance of unrecognized tax benefits $ 50.5 $ 49.4 $ 40.5 Additions for current year tax positions 13.0 9.3 11.3 Additions for prior year tax positions 3.6 2.0 2.5 Reductions for prior year tax positions (6.0 ) (4.7 ) (0.6 ) Reductions for audit settlements (7.1 ) — (0.1 ) Reductions for the expiration of statutes of limitation (6.2 ) (4.2 ) (2.8 ) Changes due to foreign currency translation adjustments 2.8 (1.3 ) (1.4 ) Ending balance of unrecognized tax benefits (excluding interest and penalties) 50.6 50.5 49.4 Interest and penalties associated with unrecognized tax benefits 11.4 11.5 8.6 Ending balance of unrecognized tax benefits (including interest and penalties) $ 62.0 $ 62.0 $ 58.0 The amount of income taxes the Company pays is subject to ongoing audits by taxing jurisdictions around the world. The Company’s estimate of the potential outcome of any uncertain tax position is subject to management’s assessment of relevant risks, facts, and circumstances existing at that time. The Company believes that it has adequately provided for these matters. However, the Company’s future results may include favorable or unfavorable adjustments to its estimates in the period the audits are resolved, which may impact the Company’s effective tax rate. As of December 31, 2017, the Company’s tax filings are generally subject to examination in major tax jurisdictions for years ending on or after December 31, 2012. The Company believes that it is reasonably possible that the amount of unrecognized tax benefits could decrease by up to approximately $7.0 million within the next twelve months. Of this possible decrease, $0.7 million would be due to the settlement of audits or resolution of administrative or judicial proceedings. The remaining possible decrease of $6.3 million would be due to the expiration of statute of limitations in various jurisdictions. |
Fair Value Measurements
Fair Value Measurements | 12 Months Ended |
Dec. 31, 2017 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | 13. Fair Value Measurements The Company applies the provisions of ASC Topic 820, Fair Value Measurements and Disclosures Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities that the reporting entity has the ability to access at the measurement date. Level 2 inputs include quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not active, inputs other than quoted prices that are observable for the asset or liability and inputs that are derived principally from or corroborated by observable market data by correlation or other means. Level 3 inputs are unobservable inputs for the asset or liability. The Company measures certain assets and liabilities at fair value as discussed throughout the notes to its consolidated financial statements. Foreign exchange currency contracts are valued using standard calculations and models primarily based on inputs such as observable forward rates, spot rates and foreign currency exchange rates at the reporting period ended date. The Company’s derivative assets and liabilities are measured at fair value and consisted of Level 2 inputs and their amounts are shown below at their gross values as of December 31, 2017 and December 31, 2016: Fair Value Measurements at Reporting Date Using Derivative Balance Sheet Location Significant Other Observable Inputs (Level 2) Fair Value at December 31, 2017 Significant Other Observable Inputs (Level 2) Fair Value at December 31, 2016 (In millions) ASSETS: Derivatives designated as hedging instruments: Foreign exchange currency contracts relating to inventory and intercompany management fee hedges Prepaid expenses and other current assets $ 2.9 $ 4.6 Derivatives not designated as hedging instruments: Foreign exchange currency contracts Prepaid expenses and other current assets 2.9 2.8 $ 5.8 $ 7.4 LIABILITIES: Derivatives designated as hedging instruments: Foreign exchange currency contracts relating to inventory and intercompany management fee hedges Other current liabilities $ 4.0 $ — Derivatives not designated as hedging instruments: Foreign exchange currency contracts Other current liabilities 2.6 3.5 $ 6.6 $ 3.5 The Company’s deferred compensation plan assets consist of Company owned life insurance policies. As these policies are recorded at their cash surrender value, they are not required to be included in the fair value table above. See Note 6, Employee Compensation Plans Shareholders’ (Deficit) Equity The following tables summarize the offsetting of the fair values of the Company’s derivative assets and derivative liabilities for presentation in the Company’s consolidated balance sheets as of December 31, 2017 and December 31, 2016: Offsetting of Derivative Assets Gross Amounts of Recognized Assets Gross Amounts Offset in the Balance Sheet Net Amounts of Assets Presented in the Balance Sheet (In millions) December 31, 2017 Foreign exchange currency contracts $ 5.8 $ (4.3 ) $ 1.5 Total $ 5.8 $ (4.3 ) $ 1.5 December 31, 2016 Foreign exchange currency contracts $ 7.4 $ (3.0 ) $ 4.4 Total $ 7.4 $ (3.0 ) $ 4.4 Offsetting of Derivative Liabilities Gross Amounts of Recognized Liabilities Gross Amounts Offset in the Balance Sheet Net Amounts of Liabilities Presented in the Balance Sheet (In millions) December 31, 2017 Foreign exchange currency contracts $ 6.6 $ (4.3 ) $ 2.3 Total $ 6.6 $ (4.3 ) $ 2.3 December 31, 2016 Foreign exchange currency contracts $ 3.5 $ (3.0 ) $ 0.5 Total $ 3.5 $ (3.0 ) $ 0.5 The Company offsets all of its derivative assets and derivative liabilities in its consolidated balance sheets to the extent it maintains master netting arrangements with related financial institutions. As of December 31, 2017 and December 31, 2016, all of the Company’s derivatives were subject to master netting arrangements and no collateralization was required for the Company’s derivative assets and derivative liabilities. |
Detail of Certain Balance Sheet
Detail of Certain Balance Sheet Accounts | 12 Months Ended |
Dec. 31, 2017 | |
Balance Sheet Related Disclosures [Abstract] | |
Details of Certain Balance Sheet Accounts | 14. Detail of Certain Balance Sheet Accounts Other Assets The Other assets on the Company’s accompanying consolidated balance sheets includes deferred compensation plan assets of $33.6 million and $30.6 million and deferred tax assets of $77.5 million and $155.2 million as of December 31, 2017 and 2016, respectively. Other Current Liabilities Other current liabilities consist of the following: December 31, 2017 2016 (In millions) Accrued compensation $ 117.3 $ 125.8 Accrued service fees to China independent service providers 58.7 46.3 Accrued advertising, events, and promotion expenses 46.3 48.4 Advance sales deposits 65.2 50.1 Income taxes payable 25.7 42.0 Other accrued liabilities 145.7 142.2 Total $ 458.9 $ 454.8 Other Non-Current Liabilities The Other non-current liabilities on the Company’s accompanying consolidated balance sheets includes deferred compensation plan liabilities of $58.1 million and $50.0 million and deferred income tax liabilities of $7.8 million and $15.3 million as of December 31, 2017 and 2016, respectively. See Note 6, Employee Compensation Plans |
Subsequent Events
Subsequent Events | 12 Months Ended |
Dec. 31, 2017 | |
Subsequent Events [Abstract] | |
Subsequent Events | 15. Subsequent Events During January 2018, an indirect wholly owned subsidiary of the Company repurchased 4,200 of the Company’s common shares for aggregate consideration of approximately $0.3 million through open market purchases under the Company’s $1.5 billion share repurchase program. These repurchases were effected pursuant to Rule 10b5-1 trading plans. See Note 8, Shareholders’ (Deficit) Equity |
Quarterly Information (Unaudite
Quarterly Information (Unaudited) | 12 Months Ended |
Dec. 31, 2017 | |
Quarterly Financial Information Disclosure [Abstract] | |
Quarterly Information (Unaudited) | 16. Quarterly Information (Unaudited) 2017 2016 (In millions, except per share data) First Quarter Ended March 31 Net sales $ 1,102.1 $ 1,119.6 Gross profit 897.5 906.5 Net income 85.2 95.8 Earnings per share Basic $ 1.03 $ 1.16 Diluted $ 0.98 $ 1.12 Second Quarter Ended June 30 Net sales $ 1,146.9 $ 1,201.8 Gross profit 928.1 965.5 Net income (loss) 137.6 (22.9 ) Earnings (loss) per share Basic $ 1.69 $ (0.28 ) Diluted $ 1.61 $ (0.28 ) Third Quarter Ended September 30 Net sales $ 1,085.4 $ 1,122.0 Gross profit 870.0 912.9 Net income 54.5 87.7 Earnings per share Basic $ 0.69 $ 1.06 Diluted $ 0.66 $ 1.01 Fourth Quarter Ended December 31(1) Net sales $ 1,093.3 $ 1,045.0 Gross profit 883.5 848.9 Net (loss) income (63.4 ) 99.4 (Loss) Earnings per share Basic $ (0.87 ) $ 1.19 Diluted $ (0.87 ) $ 1.16 (1) Includes the impact of the U.S. Tax Reform enacted during the fourth quarter of 2017, as described further in Note 12, Income Taxes |
Basis of Presentation (Policies
Basis of Presentation (Policies) | 12 Months Ended |
Dec. 31, 2017 | |
Accounting Policies [Abstract] | |
Recently Adopted Pronouncements | Recently Adopted Pronouncements In March 2016, the Financial Accounting Standards Board, or FASB, issued Accounting Standards Update, or ASU No. 2016-09, Compensation — Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting In Derivatives and Hedging (Topic 815): Contingent Put and Call Options in Debt Instruments Derivatives and Hedging In March 2016, the FASB issued ASU No. 2016-05, Derivatives and Hedging (Topic 815): Effect of Derivative Contract Novations on Existing Hedge Accounting Relationships |
New Accounting Pronouncements | New Accounting Pronouncements In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers (Topic 606) Below is a summary of the Company’s analysis under Topic 606: The Company will generally continue to recognize revenue when product is delivered to its Members. For China independent service providers, and for third party importers utilized in certain other countries where sales historically have not been material, the Company will continue to recognize revenue based on the Company’s estimate of when the service provider or third party importer sells the products because the Company is deemed to be the principal party of these product sales under Topic 606 due to the additional selling and operating requirements relating to pricing of products, conducting business with physical locations, and other selling and marketing activities required of the service providers and third party importers; this timing difference relating to the Company recognizing revenues when these third party entities sell the products compared to when the Company delivers the products to them did not have a material impact to the Company’s consolidated net sales for the periods presented. The Company’s Members, excluding its China independent service providers, may receive distributor allowances, which are comprised of discounts, rebates and wholesale commission payments from the Company. Pursuant to Topic 606, the distributor allowances resulting from the Company’s sales of its products to its Members will continue to be recorded against net sales because the distributor allowances represent discounts from the suggested retail price. The Company compensates its sales leader Members with royalty overrides for services rendered, relating to the development, retention, and management of their sales organizations. Royalty overrides are payable based on achieved sales volume. Royalty overrides will continue to be classified as an operating expense reflecting the services provided to the Company. The Company compensates its China independent service providers and third party importers utilized in certain other countries for providing marketing, selling, and customer support services. Under Topic 606, as the Company is the principal party of the product sales as described above, the service fees payable to China independent service providers and the compensation received by third party importers for the services they provide will be recorded within Selling, general & administrative expenses. Currently, under Topic 605, the service fees payable to its China independent service providers are similarly recognized within Selling, general & administrative expenses as they will be under Topic 606. However, under Topic 605, the compensation received by third party importers for the services they provide, which represents the discount provided to them, is recorded as a reduction to net sales, which differs from the treatment under Topic 606 as described above. This change in the accounting treatment under Topic 606 of the compensation for services provided by the Company’s third party importers will not impact the Company’s consolidated net income and is not material to the Company’s consolidated net sales for the fiscal years presented. The Company also reviewed its United States business and the changes required to be made pursuant to the FTC consent order. The Company has concluded that there will be no material financial impact under Topic 606 and the Company will continue to recognize revenues when it delivers the products to its United States Members; its distributor allowances, inclusive of discounts and wholesale commissions, will continue to be recorded as a reduction to net sales, and royalty overrides will continue to be classified as an operating expense under Topic 606. Shipping and handling services relating to product sales will be recognized as fulfillment activities on the Company’s performance obligation to transfer products and will therefore be recorded within net sales as part of product sales and will not be considered as separate revenues under Topic 606. Shipping and handling costs paid by the Company are currently included in cost of sales and these costs will continue to be recorded to cost of sales under Topic 606. In January 2016, the FASB issued ASU No. 2016-01, Financial Instruments – Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities The adoption of this guidance will not have a material impact on the Company’s consolidated financial statements. In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842) and subsequently issued additional updates to Topic 842. The updated guidance requires lessees to recognize a lease liability and a right-of-use asset, measured at the present value of the future minimum lease payments, at the lease commencement date. Recognition, measurement and presentation of expenses will depend on classification as a finance or operating lease. The amendments also require certain quantitative and qualitative disclosures. ASU 2016-02 is effective for all interim and annual reporting periods beginning after December 15, 2018, with early adoption permitted. A modified retrospective approach must be applied for leases existing at, or entered into after, the beginning of the earliest comparative period presented in the financial statements. The Company is evaluating the potential impact of this adoption on its consolidated financial statements; however, increases in both assets and liabilities are expected. In March 2016, the FASB issued ASU No. 2016-04, Liabilities — Extinguishments of Liabilities (Subtopic 405-20): Recognition of Breakage for Certain Prepaid Stored-Value Products In June 2016, the FASB issued ASU No. 2016-13, Financial Instrument — Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments . This ASU changes the impairment model for most financial assets, requiring the use of an expected loss model which requires entities to estimate the lifetime expected credit loss on financial assets measured at amortized cost. Such credit losses will be recorded as an allowance to offset the amortized cost of the financial asset, resulting in a net presentation of the amount expected to be collected on the financial asset. In addition, The amendments in this update are effective for reporting periods beginning after December 15, 2019, with early adoption permitted for reporting periods beginning after December 15, 2018. The Company is evaluating the potential impact of this adoption on its consolidated financial statements. In August 2016, the FASB issued ASU No. 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments . This ASU provides clarification on eight specific cash flow issues regarding presentation and classification in the statement of cash flows with the objective of reducing the existing diversity in practice. The amendments in this update are effective for reporting periods beginning after December 15, 2017, with early adoption permitted. The adoption of this guidance will not have a material impact on the Company’s consolidated financial statements. In October 2016, the FASB issued ASU No. 2016-16, Income Taxes (Topic 740): Intra-Entity Transfers of Assets Other Than Inventory Consolidation The adoption of this guidance will not have a material impact on the Company’s consolidated financial statements. In November 2016, the FASB issued ASU No. 2016-18, Statement of Cash Flows (Topic 230): Restricted Cash In January 2017, the FASB issued ASU No. 2017-04, Intangibles — Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment In May 2017, the FASB issued ASU No. 2017-09, Compensation — Stock Compensation (Topic 718): Scope of Modification Accounting In August 2017, the FASB issued ASU No. 2017-12, Derivatives and Hedging: Targeted Improvements to Accounting for Hedging Activities |
Reclassifications | Reclassifications In order to improve and simplify the Company’s financial statements, the following reclassifications have been made: Certain reclassifications were made to the prior period consolidated balance sheets, the consolidated statements of comprehensive income and the consolidated statements of cash flows to conform to the current period presentation. See Note 14, Detail of Certain Balance Sheet Accounts The Company also combined its shipping and handling revenues with its product sales into a single net sales caption in order to conform to the current period presentation as permitted under Regulation S-X. Shipping and handling revenues related to product sales were $227.4 million, $244.2 million, and $282.5 million for the years ended December 31, 2017, 2016, and 2015, respectively, and represent less than 7% of the Company’s consolidated net sales during each of those years. |
Consolidation Policy | Consolidation Policy The consolidated financial statements include the accounts of Herbalife Ltd. and its subsidiaries. All significant intercompany transactions and accounts have been eliminated. |
Foreign Currency Translation and Transactions | Foreign Currency Translation and Transactions In the majority of the countries that the Company operates, the functional currency is the local currency. The Company’s foreign subsidiaries’ asset and liability accounts are translated for consolidated financial reporting purposes into U.S. dollar amounts at year-end exchange rates. Revenue and expense accounts are translated at the average rates during the year. Foreign exchange translation adjustments are included in accumulated other comprehensive loss on the accompanying consolidated balance sheets. Foreign currency transaction gains and losses, which include the cost of foreign currency derivative contracts and the related settlement gains and losses but excluding certain foreign currency derivatives designated as cash flow hedges as discussed in Note 11, Derivative Instruments and Hedging Activities |
Forward Exchange Contracts | Forward Exchange Contracts The Company enters into foreign currency derivatives, primarily comprised of foreign currency forward contracts, in managing its foreign exchange risk on sales to Members, inventory purchases denominated in foreign currencies, and intercompany transactions and loans. The Company does not use the contracts for trading purposes. In accordance with FASB ASC, Topic 815, Derivatives and Hedging |
Cash and Cash Equivalents | Cash and Cash Equivalents The Company considers all highly liquid investments purchased with a maturity of three months or less to be cash equivalents. Cash and cash equivalents are comprised primarily of foreign and domestic bank accounts, and money market funds. These cash and cash equivalents are valued based on level 1 inputs which consist of quoted prices in active markets. To reduce its credit risk, the Company monitors the credit standing of the financial institutions that hold the Company’s cash and cash equivalents. The Company has a cash pooling arrangement with a financial institution for cash management purposes. This cash pooling arrangement allows certain of the Company’s participating subsidiaries to withdraw cash from this financial institution based upon the Company’s aggregate cash deposits held by subsidiaries who participate in the cash pooling arrangement. To the extent any participating location on an individual basis is in an overdraft position, these overdrafts will be recorded as liabilities and reflected as financing activities in the Company’s consolidated balance sheets and consolidated statement of cash flows, respectively. As of December 31, 2017 and December 31, 2016, the Company did not owe any amounts to this financial institution. |
Accounts Receivable | Accounts Receivable Accounts receivable consist principally of receivables from credit card companies, arising from the sale of products to the Company’s Members, and receivables from importers, who are utilized in a limited number of countries to sell products to Members. The Company believes the concentration of its collection risk related to its credit card receivables is diminished due to the geographic dispersion of its receivables. The receivables from credit card companies were $68.1 million and $51.8 million as of December 31, 2017 and 2016, respectively. Substantially all of the receivables from credit card companies were current as of December 31, 2017 and 2016. Although receivables from importers can be significant, the Company performs ongoing credit evaluations of its importers and maintains an allowance for potential credit losses. The Company considers customer credit-worthiness, past and current transaction history with the customer, contractual terms, current economic industry trends, and changes in customer payment terms when determining whether collectability is reasonably assured and whether to record allowances for its receivables. If the financial condition of the Company’s customers deteriorates and adversely affects their ability to make payments, additional allowances will be recorded. The Company believes that it provides adequate allowances for receivables from its Members and importers which are not material to its consolidated financial statements. During the years ended December 31, 2017, 2016, and 2015, the Company recorded $0.9 million, $1.0 million, and $3.7 million, respectively, in bad-debt expense related to allowances for the Company’s receivables. As of December 31, 2017 and 2016, the Company’s allowance for doubtful accounts was $1.2 million and $1.3 million, respectively. As of December 31, 2017 and 2016, the majority of the Company’s total outstanding accounts receivable were current. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments The Company applies the provisions of FASB authoritative guidance as it applies to its financial and non-financial assets and liabilities. The FASB authoritative guidance clarifies the definition of fair value, prescribes methods for measuring fair value, establishes a fair value hierarchy based on the inputs used to measure fair value, and expands disclosures about fair value measurements. The Company has estimated the fair value of its financial instruments using the following methods and assumptions: • The carrying amounts of cash and cash equivalents, receivables and accounts payable approximate fair value due to the short-term maturities of these instruments; • The fair value of available-for-sale investments are based on prices of similar assets traded in active markets and observable yield curves; • The fair value of option and forward contracts are based on dealer quotes; • The Company’s variable rate revolving credit facility is recorded at carrying value and is considered to approximate its fair value; • The fair value of the outstanding borrowings on the Company’s term loan under its senior secured credit facility is determined by utilizing over-the-counter market quotes; • The Company’s convertible senior notes issued in February 2014, or the Convertible Notes, are recorded at carrying value, and their fair value is determined using two valuation methods. The Company reviewed market data that was available for publicly traded, senior, unsecured nonconvertible corporate bonds issued by companies with similar credit ratings. Assumptions used in the estimate represent what market participants would use in pricing the liability component, including market yields and credit standing to develop the straight debt yield estimate. The Company also used a lattice model, which included inputs such as stock price, the Convertible Notes trading price, volatility and dividend yield as of December 31, 2017, to estimate the straight debt yield. The Company combined the results of the two valuation methods to determine the fair value of the liability component of the Convertible Notes. See Note 4, Long-Term Debt • The fair value of the CVR provided to participants in connection with the modified Dutch auction tender offer completed in October 2017, is based on a lattice model, which includes inputs such as the underlying stock price, strike price, time to expiration, and dividend yield. See Note 8, Shareholders’ (Deficit) Equity The Company applies the provisions of ASC Topic 820, Fair Value Measurements and Disclosures Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities that the reporting entity has the ability to access at the measurement date. Level 2 inputs include quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not active, inputs other than quoted prices that are observable for the asset or liability and inputs that are derived principally from or corroborated by observable market data by correlation or other means. Level 3 inputs are unobservable inputs for the asset or liability. The Company measures certain assets and liabilities at fair value as discussed throughout the notes to its consolidated financial statements. Foreign exchange currency contracts are valued using standard calculations and models primarily based on inputs such as observable forward rates, spot rates and foreign currency exchange rates at the reporting period ended date. |
Inventories | Inventories Inventories are stated at lower of cost (primarily on the first-in, first-out basis) and net realizable value. |
Debt Issuance Costs | Debt Issuance Costs Debt issuance costs represent fees and expenses related to the borrowing of the Company’s long-term debt and are amortized over the term of the related debt using the effective interest method. Debt issuance costs, except for the Company’s revolving credit facility, are recorded as a reduction to debt (contra-liability) within the Company’s consolidated balance sheets. Total amortization expense related to debt issuance costs were $8.4 million, $7.9 million, and $8.5 million for the years ended December 31, 2017, 2016, and 2015, respectively. As of December 31, 2017 and 2016, the Company’s remaining unamortized debt issuance cost was $26.2 million and $11.9 million, respectively. |
Long-Lived Assets | Long-Lived Assets As of December 31, 2017 and 2016, the Company’s net property, plant and equipment consisted of the following (in millions): December 31, 2017 2016 Property, plant and equipment — at cost: Land and building $ 51.0 $ 51.0 Furniture and fixtures 26.7 25.9 Equipment 803.5 719.8 Building and leasehold improvements 199.0 185.7 1,080.2 982.4 Less: accumulated depreciation and amortization (702.7 ) (604.4 ) Net property, plant and equipment $ 377.5 $ 378.0 In December 2012, the Company purchased an approximate 800,000 square foot facility in Winston-Salem, North Carolina, for approximately $22.2 million. The Company allocated $18.8 million and $3.4 million between buildings and land respectively, based on their relative fair values. In April 2016, the Company purchased one of its office buildings in Torrance, California, which it had previously leased, for approximately $29.6 million. The Company allocated $16.9 million and $11.6 million, which was net of the deferred rent liability of $1.1 million, between buildings and land, respectively, based on their relative fair values. As of December 31, 2017 and 2016, these amounts have been reflected in property, plant and equipment on the Company’s accompanying consolidated balance sheets. Depreciation of furniture, fixtures, and equipment (includes computer hardware and software) is computed on a straight-line basis over the estimated useful lives of the related assets, which range from three to ten years. The Company capitalizes eligible costs to acquire or develop internal-use software that are incurred subsequent to the preliminary project stage. Computer hardware and software, the majority of which is comprised of capitalized internal-use software costs, was $157.3 million and $145.7 million as of December 31, 2017 and 2016, respectively, net of accumulated depreciation. Leasehold improvements are amortized on a straight-line basis over the life of the related asset or the term of the lease, whichever is shorter. Buildings are depreciated over 40 years. Building improvements are generally depreciated over ten to fifteen years. Land is not depreciated. Depreciation and amortization expenses recorded to selling, general and administrative expenses totaled $80.1 million, $80.7 million, and $82.5 million, for the years ended December 31, 2017, 2016, and 2015, respectively. Long-lived assets are reviewed for impairment, based on undiscounted cash flows, whenever events or changes in circumstances indicate that the carrying amount of such assets may not be recoverable. Measurement of an impairment loss is based on the estimated fair value of the asset. |
Goodwill and Intangible Assets | Goodwill and marketing related intangible assets with indefinite lives are evaluated on an annual basis for impairment or more frequently if events or changes in circumstances indicate that the asset might be impaired. For goodwill, the Company uses a discounted cash flow approach to estimate the fair value of a reporting unit. If the fair value of the reporting unit is less than the carrying value then the implied fair value of the goodwill must be determined. If the implied fair value of the goodwill is less than its carrying value then a goodwill impairment amount is recorded for the difference. For the marketing related intangible assets, the Company uses a discounted cash flow model under the relief-from-royalty method in order to determine the fair value. If the fair value is less than its carrying value then an impairment amount is recorded for the difference. During the years ended December 31, 2017, 2016, and 2015, there were no additions to goodwill or marketing related intangible assets or impairments of goodwill or marketing related intangible assets. As of December 31, 2017 and 2016, the marketing-related intangible asset balance was $310.0 million which consisted of the Company’s trademark, trade name, and marketing franchise. As of December 31, 2017 and 2016, the goodwill balance was $96.9 million and $89.9 million, respectively. The increase in goodwill during the year ended December 31, 2017 was due to cumulative translation adjustments. |
Other Assets | Other Assets Other assets on the Company’s accompanying consolidated balance sheets include deferred tax assets of $77.5 million and $155.2 million as of December 31, 2017 and 2016, respectively. See Note 14, Detail of Certain Balance Sheet Accounts , for a further description of other assets. |
Income Taxes | Income Taxes Income tax expense includes income taxes payable for the current year and the change in deferred income tax assets and liabilities for the future tax consequences of events that have been recognized in the Company’s financial statements or income tax returns. A valuation allowance is recognized to reduce the carrying value of deferred income tax assets if it is believed to be more likely than not that a component of the deferred income tax assets will not be realized. The Company accounts for uncertainty in income taxes in accordance with FASB authoritative guidance which clarifies the accounting and reporting for uncertainties in income taxes recognized in an enterprise’s financial statements. This guidance prescribes a comprehensive model for the financial statement recognition, measurement, presentation and disclosure of uncertain tax positions taken or expected to be taken in income tax returns. On December 22, 2017, the U.S. enacted the 2017 Tax Cuts and Jobs Act which contains several key tax provisions that affect the Company, including, but not limited to, a one-time mandatory transition tax on accumulated foreign earnings, changes in the sourcing and calculation of foreign income, and a reduction of the corporate income tax rate to 21% effective January 1, 2018. The Company is required to recognize the effect of the tax law changes in the period of enactment, such as determining the transition tax, remeasuring its U.S. deferred tax assets and liabilities as well as reassessing the net realizability of its deferred tax assets and liabilities. In December 2017, the SEC staff issued Staff Accounting Bulletin No. 118, Income Tax Accounting Implications of the Tax Cuts and Jobs Act Income Taxes |
Royalty Overrides | Royalty Overrides Certain Members may earn commissions, called royalty overrides which include production bonuses, based on retail sales volume. Royalty overrides are based on the retail sales volume of certain other Members who are sponsored directly or indirectly by the Member. Royalty overrides are recorded when the products are delivered and revenue is recognized. The royalty overrides are compensation to Members for services rendered including the development, retention and the improved productivity of their sales organizations. As such royalty overrides are classified as an operating expense. Non-U.S. royalty override checks that have aged, for a variety of reasons, beyond a certainty of being paid, are taken back into income. Management has estimated this period of certainty to be three years worldwide. |
Distributor Compensation – U.S. | Distributor Compensation – U.S. In the U.S., distributor compensation, including Royalty Overrides, is capped if the Company does not meet an annual requirement as described in the consent order discussed in more detail in Note 7, Contingencies |
Comprehensive Income | Comprehensive Income Comprehensive income consists of net income, foreign currency translation adjustments, the effective portion of the unrealized gains or losses on derivatives, and unrealized gains or losses on available-for-sale investments. See Note 8, Shareholders’ (Deficit) Equity |
Operating Leases | Operating Leases The Company leases most of its physical properties under operating leases. Certain lease agreements generally include rent holidays and tenant improvement allowances. The Company recognizes rent holiday periods on a straight-line basis over the lease term beginning when the Company has the right to the leased space. The Company also records tenant improvement allowances and rent holidays as deferred rent liabilities and amortizes the deferred rent over the terms of the lease to rent expense. |
Research and Development | Research and Development The Company’s research and development is performed by in-house staff and outside consultants. For all periods presented, research and development costs were expensed as incurred and were not material. |
Other Operating Income | Other Operating Income To encourage local investment and operations, governments in various China provinces conduct grant programs. The Company applied for and received several such grants in China. Government grants are recorded into income when a legal right to the grant exists, there is a reasonable assurance that the grant proceeds will be received, and the substantive conditions under which the grants were provided have been met. During the years ended December 31, 2017, 2016, and 2015, the Company recognized government grant income of approximately $50.8 million, $34.2 million, and $6.5 million, respectively, in other operating income within its consolidated statements of income, related to its regional headquarters and distribution centers within China. The Company intends to continue applying for government grants in China when programs are available; however, there is no assurance that the Company will receive grants in future periods. On October 30, 2016, an arbitration tribunal awarded the Company approximately $29.7 million in connection with the re-audit of the Company’s 2010 to 2012 financial statements after the resignation of KPMG as the Company’s independent registered public accounting firm. This amount has been recognized in other operating income within the Company’s consolidated financial statements for the year ended December 31, 2016. |
Professional Fees | Professional Fees The Company expenses professional fees, including legal fees, as incurred. These professional fees are included in selling, general and administrative expenses in the Company’s consolidated statements of income. |
Advertising | Advertising Advertising costs, including Company sponsorships, are expensed as incurred and amounted to approximately $55.7 million, $64.8 million, and $66.1 million for the years ended December 31, 2017, 2016, and 2015, respectively. These expenses are included in selling, general and administrative expenses in the accompanying consolidated statements of income. |
Earnings Per Share | Earnings Per Share Basic earnings per share represents net income for the period common shares were outstanding, divided by the weighted average number of common shares outstanding for the period. Diluted earnings per share represents net income divided by the weighted average number of common shares outstanding, inclusive of the effect of dilutive securities such as outstanding stock options, stock appreciation rights, or SARs, and stock units. The following are the common share amounts used to compute the basic and diluted earnings per share for each period (in millions): Year Ended December 31, 2017 2016 2015 Weighted average shares used in basic computations 79.2 83.0 82.6 Dilutive effect of exercise of equity grants outstanding 3.7 3.1 2.7 Weighted average shares used in diluted computations 82.9 86.1 85.3 There were an aggregate of 3.4 million, 4.5 million, and 5.4 million of equity grants, consisting of stock options, SARs, and stock units that were outstanding during the years ended December 31, 2017, 2016, and 2015, respectively, but were not included in the computation of diluted earnings per share because their effect would be anti-dilutive or the performance condition of the award had not been satisfied. Since the Company will settle the principal amount of its Convertible Notes in cash and settle the conversion feature for the amount above the conversion price in common shares, or the conversion spread, the Company uses the treasury stock method for calculating any potential dilutive effect of the conversion spread on diluted earnings per share, if applicable. The conversion spread will have a dilutive impact on diluted earnings per share when the average market price of the Company’s common shares for a given period exceeds the initial conversion price of $86.28 per share. For the years ended December 31, 2017, 2016, and 2015, the Convertible Notes have been excluded from the computation of diluted earnings per share as the effect would be anti-dilutive since the conversion price of the Convertible Notes exceeded the average market price of the Company’s common shares for the years ended December 31, 2017, 2016, and 2015. The initial conversion rate and conversion price is described further in Note 4, Long-Term Debt The capped call transactions executed in connection with the issuance of the Convertible Notes are excluded from the calculation of diluted earnings per share because their impact is always anti-dilutive. Additionally, the forward transactions executed in connection with the issuance of the Convertible Notes are treated as retired shares for basic and diluted EPS purposes, although they remain legally outstanding. See Note 4, Long-Term Debt |
Revenue Recognition | Revenue Recognition The Company generally recognizes revenue upon delivery and when both the title and risk and rewards pass to the Member or importer, or as products are sold Segment Information Product sales are recognized net of product returns and discounts referred to as “distributor allowances.” Net sales include product sales and the related shipping and handling revenues. Shipping and handling revenues related to product sales were $227.4 million, $244.2 million, and $282.5 million for the years ended December 31, 2017, 2016, and 2015, respectively. Shipping and handling costs paid by the Company are included in cost of sales. The Company generally receives the net sales price in cash or through credit card payments at the point of sale. The Company currently presents sales taxes collected from customers on a net basis. Allowances for product returns, primarily in connection with the Company’s buyback program, are provided at the time the sale is recorded. This accrual is based upon historical return rates for each country and the relevant return pattern, which reflects anticipated returns to be received over a period of up to 12 months following the original sale. Allowances for product returns were $3.9 million, $3.9 million, and $3.9 million as of December 31, 2017, 2016, and 2015, respectively. Product returns were $4.4 million, $4.5 million, and $5.0 million during the years ended December 31, 2017, 2016, and 2015, respectively. |
Non-Cash Investing and Financing Activities | Non-Cash Investing and Financing Activities During the years ended December 31, 2017, 2016, and 2015, the Company recorded $10.1 million, $12.7 million, and $12.3 million, respectively, of non-cash capital expenditures. In addition, during the year ended December 31, 2015, the Company recorded $15.0 million of a non-cash release of deposits in escrow that were used to reduce the Company’s accrued expense liability. During the years ended December 31, 2017, 2016, and 2015, the Company recorded $2.3 million, $20.8 million, and $17.3 million of non-cash borrowings that were used to finance software maintenance. Additionally, see Note 8, Shareholders’ (Deficit) Equity |
Share-Based Payments | Share-Based Payments The Company accounts for share-based compensation in accordance with FASB authoritative guidance which requires the measurement of share-based compensation expense for all share-based payment awards made to employees. The Company measures share-based compensation cost at the grant date, based on the fair value of the award. The Company recognizes share-based compensation expense for service condition awards on a straight-line basis over the employee’s requisite service period. The Company recognizes share-based compensation expense for performance condition awards over the vesting term using the graded vesting method. |
Use of Estimates | Use of Estimates The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions. Such estimates and assumptions affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. The Company evaluates its estimates and assumptions on an ongoing basis using historical experience and other factors, including the current economic environment, which the Company believes to be reasonable under the circumstances. The Company adjusts such estimates and assumptions when facts and circumstances dictate. Illiquid credit markets, volatile equity, and foreign currency have combined to increase the uncertainty inherent in such estimates and assumptions. As future events and their effects cannot be determined with precision, actual results could differ from these estimates. Changes in estimates resulting from continuing changes in the economic environment will be reflected in the financial statements in future periods. |
Segment Reporting | The Company is a nutrition company that sells a wide range of weight management, targeted nutrition, energy, sports & fitness, and outer nutrition products. The Company’s products are manufactured by the Company in its Changsha, Hunan, China extraction facility, Suzhou, China facility, Nanjing, China Facility, Lake Forest, California facility, and Winston-Salem, North Carolina facility, and by third party providers, and then are sold to Members who consume and sell Herbalife products to retail consumers or other Members. Revenues reflect sales of products by the Company to its Members and are categorized based on geographic location. As of December 31, 2017, the Company sold products in 94 countries throughout the world and was organized and managed by six geographic regions: North America, Mexico, South & Central America, EMEA (Europe, Middle East, and Africa), Asia Pacific and China The Company defines its operating segments as those geographical operations. he Company reviews its net sales and contribution margin by operating segment, and reviews its assets and capital expenditures on a consolidated basis and not by operating segment. Therefore, net sales and contribution margin are presented by reportable segment and assets and capital expenditures by segment are not presented. |
Derivatives and Hedging Policies | Foreign Currency Instruments The Company designates certain foreign currency derivatives, primarily comprised of foreign currency forward contracts, as freestanding derivatives for which hedge accounting does not apply. The changes in the fair market value of these freestanding derivatives are included in selling, general and administrative expenses in the Company’s consolidated statements of income. The Company uses freestanding foreign currency derivatives to hedge foreign-currency-denominated intercompany transactions and to partially mitigate the impact of foreign currency fluctuations. The fair value of the freestanding foreign currency derivatives is based on third-party quotes. The Company’s foreign currency derivative contracts are generally executed on a monthly basis. The Company designates as cash-flow hedges those foreign currency forward contracts it enters into to hedge forecasted inventory purchases and intercompany management fees that are subject to foreign currency exposures. Forward contracts are used to hedge forecasted inventory purchases over specific months. Changes in the fair value of these forward contracts, excluding forward points, designated as cash-flow hedges are recorded as a component of accumulated other comprehensive income (loss) within shareholders’ (deficit) equity, and are recognized in cost of sales in the consolidated statement of income during the period which approximates the time the hedged inventory is sold. The Company also hedges forecasted intercompany management fees over specific months. These contracts allow the Company to sell Euros in exchange for U.S. dollars at specified contract rates. Changes in the fair value of these forward contracts designated as cash flow hedges are recorded as a component of accumulated other comprehensive income (loss) within shareholders’ (deficit) equity, and are recognized in selling, general and administrative expenses in the consolidated statement of income during the period when the hedged item and underlying transaction affect earnings. |
Basis of Presentation (Tables)
Basis of Presentation (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Accounting Policies [Abstract] | |
Net Property, Plant and Equipment | As of December 31, 2017 and 2016, the Company’s net property, plant and equipment consisted of the following (in millions): December 31, 2017 2016 Property, plant and equipment — at cost: Land and building $ 51.0 $ 51.0 Furniture and fixtures 26.7 25.9 Equipment 803.5 719.8 Building and leasehold improvements 199.0 185.7 1,080.2 982.4 Less: accumulated depreciation and amortization (702.7 ) (604.4 ) Net property, plant and equipment $ 377.5 $ 378.0 |
Computation of Basic and Diluted Earnings Per Share | The following are the common share amounts used to compute the basic and diluted earnings per share for each period (in millions): Year Ended December 31, 2017 2016 2015 Weighted average shares used in basic computations 79.2 83.0 82.6 Dilutive effect of exercise of equity grants outstanding 3.7 3.1 2.7 Weighted average shares used in diluted computations 82.9 86.1 85.3 |
Inventories (Tables)
Inventories (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Inventory Disclosure [Abstract] | |
Classes of Inventory | The following are the major classes of inventory (in millions): December 31, 2017 2016 Raw materials $ 44.2 $ 49.3 Work in process 4.8 3.9 Finished goods 292.2 318.1 Total $ 341.2 $ 371.3 |
Long-Term Debt (Tables)
Long-Term Debt (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Debt Disclosure [Abstract] | |
Schedule of Long-Term Debt | Long-term debt consists of the following: December 31, 2017 2016 (In millions) Borrowings under prior senior secured credit facility, carrying value $ — $ 410.0 Borrowings under new senior secured credit facility, carrying value 1,190.2 — Convertible senior notes, carrying value of liability component 1,070.0 1,024.8 Other 7.9 13.1 Total 2,268.1 1,447.9 Less: current portion 102.4 9.5 Long-term portion $ 2,165.7 $ 1,438.4 |
Annual Scheduled Principal Payments of Debt | As of December 31, 2017, annual scheduled principal payments of debt were as follows (in millions): Principal Payments 2018 $ 102.4 2019 1,250.0 2020 97.9 2021 97.5 2022 97.5 Thereafter 739.4 Total $ 2,384.7 |
Lease Obligations (Tables)
Lease Obligations (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Leases [Abstract] | |
Future Minimum Rental Commitments for Non-Cancelable Operating Leases | Certain leases contain renewal options. Future minimum rental commitments for non-cancelable operating leases as of December 31, 2017 were as follows (in millions): Operating 2018 $ 51.6 2019 42.7 2020 30.2 2021 17.7 2022 13.6 Thereafter 73.2 Total $ 229.0 |
Shareholders' (Deficit) Equity
Shareholders' (Deficit) Equity (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Equity [Abstract] | |
Summary of Changes in Accumulated Other Comprehensive Income (Loss) | The following table summarizes changes in accumulated other comprehensive income (loss) during the years ended December 31, 2017, 2016, and 2015: Changes in Accumulated Other Comprehensive Income (Loss) by Component Foreign Currency Translation Adjustments Unrealized Gain (Loss) Derivatives Other Total (In millions) Balance as of December 31, 2014 $ (96.4 ) $ 18.0 $ 0.2 $ (78.2 ) Other comprehensive income (loss) before reclassifications, net of tax (86.6 ) 15.4 (1.7 ) (72.9 ) Amounts reclassified from accumulated other comprehensive income (loss) to income, net of tax(1) — (16.0 ) 1.6 (14.4 ) Total other comprehensive income (loss), net of reclassifications (86.6 ) (0.6 ) (0.1 ) (87.3 ) Balance as of December 31, 2015 $ (183.0 ) $ 17.4 $ 0.1 $ (165.5 ) Other comprehensive income (loss) before reclassifications, net of tax (32.5 ) 8.4 — (24.1 ) Amounts reclassified from accumulated other comprehensive income (loss) to income, net of tax(1) — (15.4 ) (0.1 ) (15.5 ) Total other comprehensive income (loss), net of reclassifications (32.5 ) (7.0 ) (0.1 ) (39.6 ) Balance as of December 31, 2016 $ (215.5 ) $ 10.4 $ — $ (205.1 ) Other comprehensive income (loss) before reclassifications, net of tax 44.9 (7.9 ) — 37.0 Amounts reclassified from accumulated other comprehensive income (loss) to income, net of tax(1) — 2.7 — 2.7 Total other comprehensive income (loss), net of reclassifications 44.9 (5.2 ) — 39.7 Balance as of December 31, 2017 $ (170.6 ) $ 5.2 $ — $ (165.4 ) (1) See Note 2, Basis of Presentation Derivative Instruments and Hedging Activities |
Share-Based Compensation (Table
Share-Based Compensation (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | |
Weighted Average Assumptions Use in Calculation of Fair Value for Service and Performance Conditions Awards | The following table summarizes the weighted average assumptions used in the calculation of the fair value for service condition awards for the years ended December 31, 2017, 2016, and 2015: SARs Year Ended December 31, 2017 2016 2015 Expected volatility 49.2 % 49.6 % 48.7 % Dividends yield 0.0 % 0.1 % 1.6 % Expected term 6.0 years 6.0 years 5.8 years Risk-free interest rate 2.2 % 1.2 % 1.6 % SARs Year Ended December 31, 2017 2016 2015 Expected volatility 49.6 % 49.6 % 48.8 % Dividends yield 0.0 % 0.0 % 1.6 % Expected term 6.1 years 6.0 years 5.8 years Risk-free interest rate 2.2 % 1.2 % 1.6 % |
Summary of Activity Under Share-Based Compensation Plans | The following tables summarize the activity under all share-based compensation plans, which includes all stock awards, for the year ended December 31, 2017: Stock Options & SARs Awards Weighted Average Exercise Weighted Average Remaining Contractual Term Aggregate Intrinsic Value(1) (In thousands) (In millions) Outstanding as of December 31, 2016(2) (3) 11,998 $ 41.52 6.0 years $ 148.7 Granted 1,362 $ 57.33 Exercised (3,394 ) $ 31.86 Forfeited (369 ) $ 53.59 Outstanding as of December 31, 2017(2) (3) 9,597 $ 46.72 6.2 years $ 212.0 Exercisable as of December 31, 2017(4) 5,438 $ 46.30 4.8 years $ 126.9 (1) The intrinsic value is the amount by which the current market value of the underlying stock exceeds the exercise price of the stock award. (2) Includes 0.1 million and 0.1 million market condition SARS as of December 31, 2017 and 2016, respectively. (3) Includes 3.1 million and 2.9 million performance condition SARs as of December 31, 2017 and 2016, respectively. (4) Includes 1.5 million performance condition SARs. The following table summarizes the activities for stock units, primarily relating to directors of the Company, for the year ended Incentive Plan and Independent Directors Stock Units Shares Weighted Average Grant Date Fair Value (In thousands) Outstanding and nonvested as of December 31, 2016 26 $ 62.35 Granted(1) 162 $ 68.74 Vested (25 ) $ 62.40 Forfeited — Outstanding and nonvested as of December 31, 2017 163 $ 68.69 (1 ) This includes 134,388 performance based stock unit awards which represents the maximum amount that can vest. |
Segment Information (Tables)
Segment Information (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Segment Reporting [Abstract] | |
Reconciliation of Revenue from Segments to Consolidated | The operating information for the two reportable segments, and sales by product line are as follows: Year Ended December 31, 2017 2016 2015 (In millions) Net Sales: Primary Reporting Segment $ 3,541.8 $ 3,619.6 $ 3,622.8 China 885.9 868.8 846.2 Total Net Sales $ 4,427.7 $ 4,488.4 $ 4,469.0 Contribution Margin(1): Primary Reporting Segment $ 1,534.2 $ 1,571.9 $ 1,598.8 China(2) 790.7 789.3 762.8 Total Contribution Margin $ 2,324.9 $ 2,361.2 $ 2,361.6 Selling, general and administrative expense(2) 1,758.6 1,966.9 1,784.5 Other operating income (50.8 ) (63.8 ) (6.5 ) Interest expense 160.8 99.3 100.5 Interest income 14.5 5.9 5.6 Other expense, net (0.4 ) — 2.3 Income before income taxes 471.2 364.7 486.4 Income taxes 257.3 104.7 147.3 Net Income $ 213.9 $ 260.0 $ 339.1 |
Schedule of Entity-Wide Information, Revenue from External Customers by Products and Services | Year Ended December 31, 2017 2016 2015 (In millions) Net sales by product line: Weight Management $ 2,842.5 $ 2,864.5 $ 2,862.8 Targeted Nutrition 1,082.8 1,062.8 1,015.4 Energy, Sports & Fitness 263.8 268.4 250.9 Outer Nutrition 93.9 110.4 133.0 Literature, Promotional and Other(3) 144.7 182.3 206.9 Total Net Sales $ 4,427.7 $ 4,488.4 $ 4,469.0 Net sales by geographic area: United States $ 818.3 $ 935.0 $ 860.0 Mexico 442.7 446.6 479.9 China 885.9 868.8 846.2 Others 2,280.8 2,238.0 2,282.9 Total Net Sales $ 4,427.7 $ 4,488.4 $ 4,469.0 (1) Contribution margin consists of net sales less cost of sales and royalty overrides. For the China segment, contribution margin does not include service fees to China independent service providers. (2) Service fees to China independent service providers totaling $419.5 million, $407.1 million, and $403.5 million for the years ended December 31, 2017, 2016, and 2015, respectively, are included in selling, general and administrative expenses. (3) Product buy backs and returns in all product categories are included in literature, promotional and other category. |
Schedule of Property, Plant and Equipment and Deferred Tax Assets by Geographic Area | The following table sets forth property, plant and equipment and deferred tax assets by geographic area: December 31, 2017 2016 2015 (In millions) Property, Plant and Equipment, net: United States $ 289.8 $ 290.7 $ 264.2 Foreign 87.7 87.3 75.0 Total Property, Plant and Equipment, net $ 377.5 $ 378.0 $ 339.2 Deferred Tax Assets: United States $ 103.6 $ 218.7 $ 188.5 Foreign 70.9 62.5 63.9 Total Deferred Tax Assets $ 174.5 $ 281.2 $ 252.4 |
Derivative Instruments and He34
Derivative Instruments and Hedging Activities (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Derivative Instruments And Hedging Activities Disclosure [Abstract] | |
Summary of Foreign Currency Forward Contracts Outstanding | The table below describes all foreign currency forward contracts that were outstanding as of December 31, 2017 and December 31, 2016: Foreign Currency Average Contract Rate Original Notional Fair Value Gain (Loss) (In millions) (In millions) As of December 31, 2017 Buy Argentine peso sell Euro 21.40 $ 0.5 $ — Buy Australian dollar sell Euro 1.55 0.9 — Buy Canadian dollar sell Euro 1.52 0.5 — Buy Chilean peso sell Euro 749.55 0.6 — Buy Chinese yuan sell Euro 8.03 25.9 0.4 Buy Euro sell Argentine peso 21.46 0.5 — Buy Euro sell Australian dollar 1.56 4.8 (0.1 ) Buy Euro sell Canadian dollar 1.52 0.5 — Buy Euro sell Chilean peso 749.35 1.1 — Buy Euro sell Chinese yuan 7.84 26.5 0.2 Buy Euro sell Ghana cedi 5.61 3.0 (0.1 ) Buy Euro sell Hong Kong dollar 9.26 6.8 0.1 Buy Euro sell Indonesian rupiah 16,113.59 11.5 0.1 Buy Euro sell Japanese yen 133.88 0.4 — Buy Euro sell Kazakhstani tenge 401.40 1.7 — Buy Euro sell Mexican peso 22.65 59.1 3.6 Buy Euro sell Malaysian ringgit 4.84 1.6 — Buy Euro sell Peruvian nuevo sol 3.85 4.9 — Buy Euro sell Philippine peso 60.03 5.3 — Buy Euro sell Russian ruble 70.38 10.8 (0.1 ) Buy Euro sell Thai baht 38.33 1.3 — Buy Euro sell Taiwan dollar 35.59 0.6 — Buy Euro sell U.S. dollar 1.18 59.1 0.9 Buy Euro sell South African rand 16.37 3.8 (0.3 ) Buy British pound sell Euro 0.88 3.4 (0.1 ) Buy British pound sell U.S. dollar 1.35 2.8 — Buy Hong Kong dollar sell Euro 9.31 3.0 — Buy Indonesian rupiah sell Euro 16,164.33 4.8 — Buy Indonesian rupiah sell U.S. dollar 13,676.00 6.2 — Buy Korean won sell U.S. dollar 1,077.18 5.4 0.1 Buy Kazakhstani tenge sell U.S. dollar 338.75 0.9 — Buy Mexican peso sell Euro 22.97 7.1 (0.2 ) Buy Malaysian ringgit sell Euro 4.90 0.5 — Buy Norwegian krone sell U.S. dollar 8.26 1.2 — Buy Peruvian nuevo sol sell Euro 3.85 2.3 — Buy Russian ruble sell Euro 70.47 4.4 0.1 Buy Swedish krona sell U.S. dollar 8.37 1.9 0.1 Buy Thai baht sell Euro 38.69 2.2 — Buy Taiwan dollar sell U.S. dollar 29.78 5.9 0.1 Buy U.S. dollar sell Colombian peso 2,996.00 1.0 — Buy U.S. dollar sell Euro 1.15 141.1 (5.3 ) Buy U.S. dollar sell British pound 1.34 6.8 (0.1 ) Buy U.S. dollar sell South African rand 13.93 1.9 (0.2 ) Buy South African rand sell Euro 15.18 0.9 — Total forward contracts $ 435.4 $ (0.8 ) Foreign Currency Average Contract Rate Original Notional Fair Value Gain (Loss) (In millions) (In millions) As of December 31, 2016 Buy Chinese yuan sell Euro 7.51 $ 61.8 $ 1.0 Buy Colombian peso sell U.S. dollar 3,111.41 2.6 0.1 Buy Euro sell Australian dollar 1.46 1.7 — Buy Euro sell Chilean peso 723.80 1.0 — Buy Euro sell Hong Kong dollar 8.11 13.4 0.1 Buy Euro sell Indonesian rupiah 14,394.40 9.4 (0.1 ) Buy Euro sell Japanese yen 122.54 0.6 — Buy Euro sell Mexican peso 22.01 52.2 1.2 Buy Euro sell Peruvian nuevo sol 3.61 3.9 (0.1 ) Buy Euro sell Philippine peso 53.11 5.4 (0.1 ) Buy Euro sell Russian ruble 68.37 5.6 (0.3 ) Buy Euro sell U.S. dollar 1.08 74.5 (1.5 ) Buy Euro sell South African rand 15.02 3.4 (0.1 ) Buy British pound sell Euro 0.84 3.1 — Buy Hong Kong dollar sell Euro 8.11 11.9 (0.1 ) Buy Indonesian rupiah sell Euro 14,222.02 3.9 — Buy Korean won sell U.S. dollar 1,167.30 5.0 (0.2 ) Buy Kazakhstani tenge sell U.S. dollar 342.00 0.9 — Buy Mexican peso sell Euro 21.30 11.9 (0.3 ) Buy Norwegian krone sell U.S. dollar 8.70 1.1 — Buy Peruvian nuevo sol sell Euro 3.57 1.0 — Buy Philippine peso sell Euro 52.42 1.7 — Buy Russian ruble sell Euro 67.50 3.2 0.1 Buy Swedish krona sell U.S. dollar 9.17 0.8 — Buy Taiwan dollar sell U.S. dollar 32.08 17.1 (0.1 ) Buy U.S. dollar sell Colombian peso 3,092.61 5.6 (0.1 ) Buy U.S. dollar sell Euro 1.06 140.4 4.5 Buy U.S. dollar sell Japanese yen 117.39 0.5 — Buy U.S. dollar sell South African rand 14.14 2.1 (0.1 ) Buy South African rand sell Euro 14.75 0.4 — Buy South African rand sell U.S. dollar 14.24 1.1 — Total forward contracts $ 447.2 $ 3.9 |
Gains (Losses) Relating to Derivative Instruments Recorded in Other Comprehensive Loss | The following table summarizes gains (losses) relating to derivative instruments recorded in other comprehensive loss during the years ended December 31, 2017, 2016, and 2015: Amount of Gain (Loss) Recognized in Other Comprehensive Loss For the Year Ended December 31, 2017 December 31, 2016 December 31, 2015 (In millions) Derivatives designated as hedging instruments: Foreign exchange currency contracts relating to inventory and intercompany management fee hedges $ (7.9 ) $ 8.1 $ 14.8 |
Gains (Losses) Relating to Derivative Instruments Recorded to Income | The following table summarizes gains (losses) relating to derivative instruments recorded to income during the years ended December 31, 2017, 2016, and 2015: Amount of Gain (Loss) Recognized in Income For the Year Ended December 31, 2017 December 31, 2016 December 31, 2015 Location Recognized in Income (In millions) Derivatives designated as hedging instruments: Foreign exchange currency contracts relating to inventory hedges and intercompany management fee hedges(1) $ (0.1 ) $ 0.2 $ 0.4 Selling, general and administrative expenses Derivatives not designated as hedging instruments: Foreign exchange currency contracts $ (8.6 ) $ (4.3 ) $ (4.1 ) Selling, general and administrative expenses (1) For foreign exchange contracts designated as hedging instruments, the amounts recognized in income primarily represent the amounts excluded from the assessment of hedge effectiveness for the years ended December 31, 2017 and 2016. For the year ended December 31, 2015, there was a $1.3 million benefit related to hedge ineffectiveness partially offset against a $0.9 million expense related to amounts excluded from the assessment of hedge effectiveness recognized in income (loss). |
Gains (Losses) Relating to Derivative Instruments Reclassified from Accumulated Other Comprehensive Loss into Income Effective Portion | The following table summarizes gains (losses) relating to derivative instruments reclassified from accumulated other comprehensive loss into income during the years ended December 31, 2017, 2016, and 2015: Amount of Gain (Loss) Reclassified from Accumulated Other Comprehensive Loss into Income Location of Gain (Loss) Reclassified For the Year Ended from December 31, 2017 December 31, 2016 December 31, 2015 Comprehensive Loss into Income (effective portion) (In millions) Derivatives designated as hedging instruments: Foreign exchange currency contracts relating to inventory hedges $ (0.5 ) $ 14.7 $ 15.8 Cost of sales Foreign exchange currency contracts relating to intercompany management fee hedges $ (2.2 ) $ 0.3 $ 0.2 Selling, general and administrative expenses |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Income Tax Disclosure [Abstract] | |
Components of Income before Income Taxes | The components of income before income taxes are as follows (in millions): Year Ended December 31, 2017 2016 2015 Domestic $ (29.0 ) $ (89.3 ) $ 80.9 Foreign 500.2 454.0 405.5 Total $ 471.2 $ 364.7 $ 486.4 |
Components of Income Tax Expense | Income taxes are as follows (in millions): Year Ended December 31, 2017 2016 2015 Current: Foreign $ 147.1 $ 127.9 $ 147.0 Federal 10.6 12.4 35.4 State 1.8 0.8 3.1 159.5 141.1 185.5 Deferred: Foreign (8.6 ) 12.5 (13.2 ) Federal 106.4 (47.2 ) (23.8 ) State — (1.7 ) (1.2 ) 97.8 (36.4 ) (38.2 ) $ 257.3 $ 104.7 $ 147.3 |
Deferred Tax Assets and Liabilities | The significant categories of temporary differences that gave rise to deferred tax assets and liabilities are as follows (tax effected in millions): December 31, 2017 2016 Deferred income tax assets: Accruals not currently deductible $ 78.5 $ 85.2 Tax loss and credit carryforwards of certain foreign subsidiaries 137.6 115.1 Tax loss and domestic tax credit carryforwards 191.4 102.6 Deferred compensation plan 49.7 73.8 Accrued vacation 4.4 6.2 Inventory reserve 7.4 11.2 Other 4.9 2.5 Gross deferred income tax assets 473.9 396.6 Less: valuation allowance (299.4 ) (115.4 ) Total deferred income tax assets $ 174.5 $ 281.2 Deferred income tax liabilities: Intangible assets $ 71.1 $ 112.2 Depreciation/amortization 5.4 15.9 Unremitted foreign earnings 20.5 5.5 Other 7.7 7.7 Total deferred income tax liabilities 104.7 141.3 Total net deferred tax assets $ 69.8 $ 139.9 |
Reconciliation between Provision for Income Taxes at Statutory Rate and Provision for Income Taxes at Effective Tax Rate | The applicable statutory income tax rate in the Cayman Islands was zero for Herbalife Ltd. for the years being reported. For purposes of the reconciliation between the provision for income taxes at the statutory rate and the provision for income taxes at the effective tax rate, a notional 35% tax rate is applied as follows: Year Ended December 31, 2017 2016 2015 (In millions) Tax expense at United States statutory rate $ 164.9 $ 127.7 $ 170.2 Increase (decrease) in tax resulting from: Differences between U.S. and foreign tax rates on foreign income, including withholding taxes (42.7 ) (16.6 ) 203.1 U.S. tax (benefit) on foreign income net of foreign tax credits (22.9 ) (10.2 ) (23.9 ) (Decrease) increase in valuation allowances 183.7 (5.6 ) (205.6 ) State taxes, net of federal benefit 1.9 0.3 1.7 Unrecognized tax benefits (4.0 ) 5.3 10.1 Excess tax benefits on equity awards (31.1 ) — — Other 7.5 3.8 (8.3 ) Total $ 257.3 $ 104.7 $ 147.3 |
Changes Occurred in Amount of Unrecognized Tax Benefits | The following changes occurred in the amount of unrecognized tax benefits during the years ended December 31, 2017, 2016, and 2015 (in millions): Year Ended December 31, 2017 2016 2015 Beginning balance of unrecognized tax benefits $ 50.5 $ 49.4 $ 40.5 Additions for current year tax positions 13.0 9.3 11.3 Additions for prior year tax positions 3.6 2.0 2.5 Reductions for prior year tax positions (6.0 ) (4.7 ) (0.6 ) Reductions for audit settlements (7.1 ) — (0.1 ) Reductions for the expiration of statutes of limitation (6.2 ) (4.2 ) (2.8 ) Changes due to foreign currency translation adjustments 2.8 (1.3 ) (1.4 ) Ending balance of unrecognized tax benefits (excluding interest and penalties) 50.6 50.5 49.4 Interest and penalties associated with unrecognized tax benefits 11.4 11.5 8.6 Ending balance of unrecognized tax benefits (including interest and penalties) $ 62.0 $ 62.0 $ 58.0 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Fair Value Disclosures [Abstract] | |
Derivative Assets and Liabilities Measured at Fair Value | The Company’s derivative assets and liabilities are measured at fair value and consisted of Level 2 inputs and their amounts are shown below at their gross values as of December 31, 2017 and December 31, 2016: Fair Value Measurements at Reporting Date Using Derivative Balance Sheet Location Significant Other Observable Inputs (Level 2) Fair Value at December 31, 2017 Significant Other Observable Inputs (Level 2) Fair Value at December 31, 2016 (In millions) ASSETS: Derivatives designated as hedging instruments: Foreign exchange currency contracts relating to inventory and intercompany management fee hedges Prepaid expenses and other current assets $ 2.9 $ 4.6 Derivatives not designated as hedging instruments: Foreign exchange currency contracts Prepaid expenses and other current assets 2.9 2.8 $ 5.8 $ 7.4 LIABILITIES: Derivatives designated as hedging instruments: Foreign exchange currency contracts relating to inventory and intercompany management fee hedges Other current liabilities $ 4.0 $ — Derivatives not designated as hedging instruments: Foreign exchange currency contracts Other current liabilities 2.6 3.5 $ 6.6 $ 3.5 |
Offsetting of Derivative Assets | The following tables summarize the offsetting of the fair values of the Company’s derivative assets and derivative liabilities for presentation in the Company’s consolidated balance sheets as of December 31, 2017 and December 31, 2016: Offsetting of Derivative Assets Gross Amounts of Recognized Assets Gross Amounts Offset in the Balance Sheet Net Amounts of Assets Presented in the Balance Sheet (In millions) December 31, 2017 Foreign exchange currency contracts $ 5.8 $ (4.3 ) $ 1.5 Total $ 5.8 $ (4.3 ) $ 1.5 December 31, 2016 Foreign exchange currency contracts $ 7.4 $ (3.0 ) $ 4.4 Total $ 7.4 $ (3.0 ) $ 4.4 |
Offsetting of Derivative Liabilities | Offsetting of Derivative Liabilities Gross Amounts of Recognized Liabilities Gross Amounts Offset in the Balance Sheet Net Amounts of Liabilities Presented in the Balance Sheet (In millions) December 31, 2017 Foreign exchange currency contracts $ 6.6 $ (4.3 ) $ 2.3 Total $ 6.6 $ (4.3 ) $ 2.3 December 31, 2016 Foreign exchange currency contracts $ 3.5 $ (3.0 ) $ 0.5 Total $ 3.5 $ (3.0 ) $ 0.5 |
Detail of Certain Balance She37
Detail of Certain Balance Sheet Accounts (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Balance Sheet Related Disclosures [Abstract] | |
Schedule of Other Current Liabilities | Other current liabilities consist of the following: December 31, 2017 2016 (In millions) Accrued compensation $ 117.3 $ 125.8 Accrued service fees to China independent service providers 58.7 46.3 Accrued advertising, events, and promotion expenses 46.3 48.4 Advance sales deposits 65.2 50.1 Income taxes payable 25.7 42.0 Other accrued liabilities 145.7 142.2 Total $ 458.9 $ 454.8 |
Quarterly Information (Unaudi38
Quarterly Information (Unaudited) (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Quarterly Financial Information Disclosure [Abstract] | |
Quarterly Net Income, Basic Earnings Per Share and Diluted Earnings Per Share | 2017 2016 (In millions, except per share data) First Quarter Ended March 31 Net sales $ 1,102.1 $ 1,119.6 Gross profit 897.5 906.5 Net income 85.2 95.8 Earnings per share Basic $ 1.03 $ 1.16 Diluted $ 0.98 $ 1.12 Second Quarter Ended June 30 Net sales $ 1,146.9 $ 1,201.8 Gross profit 928.1 965.5 Net income (loss) 137.6 (22.9 ) Earnings (loss) per share Basic $ 1.69 $ (0.28 ) Diluted $ 1.61 $ (0.28 ) Third Quarter Ended September 30 Net sales $ 1,085.4 $ 1,122.0 Gross profit 870.0 912.9 Net income 54.5 87.7 Earnings per share Basic $ 0.69 $ 1.06 Diluted $ 0.66 $ 1.01 Fourth Quarter Ended December 31(1) Net sales $ 1,093.3 $ 1,045.0 Gross profit 883.5 848.9 Net (loss) income (63.4 ) 99.4 (Loss) Earnings per share Basic $ (0.87 ) $ 1.19 Diluted $ (0.87 ) $ 1.16 (1) Includes the impact of the U.S. Tax Reform enacted during the fourth quarter of 2017, as described further in Note 12, Income Taxes |
Organization - Additional Infor
Organization - Additional Information (Detail) | 12 Months Ended |
Dec. 31, 2017Segment | |
Organization Consolidation And Presentation Of Financial Statements [Abstract] | |
Number of geographic regions | 6 |
Basis of Presentation - Additio
Basis of Presentation - Additional Information (Detail) $ / shares in Units, shares in Millions | 1 Months Ended | 12 Months Ended | ||||||
Apr. 30, 2016USD ($)Building | Dec. 31, 2012USD ($)ft² | Dec. 31, 2018 | Dec. 31, 2017USD ($)$ / sharesshares | Dec. 31, 2016USD ($)$ / sharesshares | Dec. 31, 2015USD ($)$ / sharesshares | Jan. 01, 2017USD ($) | Oct. 30, 2016USD ($) | |
Subsidiary or Equity Method Investee [Line Items] | ||||||||
Deferred tax assets, gross | $ 473,900,000 | $ 396,600,000 | ||||||
Shipping and handling revenues | $ 227,400,000 | $ 244,200,000 | $ 282,500,000 | |||||
Shipping and handing revenues to Company's consolidated net sales, percentage | 7.00% | 7.00% | 7.00% | |||||
Foreign currency transaction losses | $ (13,700,000) | $ (11,400,000) | $ (34,700,000) | |||||
Receivables from credit card company | 68,100,000 | 51,800,000 | ||||||
Bad-debt expense | 900,000 | 1,000,000 | 3,700,000 | |||||
Allowance for doubtful accounts | 1,200,000 | 1,300,000 | ||||||
Amortization expense related to debt issuance costs | 8,400,000 | 7,900,000 | 8,500,000 | |||||
Unamortized debt issuance cost | 26,200,000 | 11,900,000 | ||||||
Capitalized internal-use software costs | 157,300,000 | 145,700,000 | ||||||
Depreciation and amortization of property, plant and equipment | 80,100,000 | 80,700,000 | 82,500,000 | |||||
Additions to goodwill or marketing related intangible assets | 0 | 0 | 0 | |||||
Impairments of goodwill or marketing related intangible assets | 0 | 0 | 0 | |||||
Marketing related intangible assets | 310,000,000 | 310,000,000 | ||||||
Goodwill | 96,900,000 | 89,900,000 | ||||||
Deferred tax assets | $ 77,500,000 | 155,200,000 | ||||||
Change in income tax rate | 35.00% | |||||||
Other operating income | $ 50,800,000 | 63,800,000 | 6,500,000 | |||||
Arbitration tribunal award in connection with the re-audit of the Company’s 2010 to 2012 financial statements | $ 29,700,000 | |||||||
Advertising costs | $ 55,700,000 | $ 64,800,000 | $ 66,100,000 | |||||
Equity grants with anti-dilutive effect | shares | 3.4 | 4.5 | 5.4 | |||||
Allowance for product returns | $ 3,900,000 | $ 3,900,000 | $ 3,900,000 | |||||
Product returns | 4,400,000 | 4,500,000 | 5,000,000 | |||||
Non-cash capital expenditures | 10,100,000 | 12,700,000 | 12,300,000 | |||||
Non-cash inflows relating to deposits in escrow | 15,000,000 | |||||||
Non-cash borrowings that were used to finance software maintenance | 2,300,000 | 20,800,000 | 17,300,000 | |||||
Convertible Debt [Member] | ||||||||
Subsidiary or Equity Method Investee [Line Items] | ||||||||
Amortization expense related to debt issuance costs | $ 4,000,000 | $ 3,800,000 | $ 3,200,000 | |||||
Convertible notes initial conversion price | $ / shares | $ 86.28 | $ 86.28 | $ 86.28 | |||||
Scenario, Forecast [Member] | ||||||||
Subsidiary or Equity Method Investee [Line Items] | ||||||||
Change in income tax rate | 21.00% | |||||||
Other Assets [Member] | ||||||||
Subsidiary or Equity Method Investee [Line Items] | ||||||||
Deferred tax assets | $ 77,500,000 | $ 155,200,000 | ||||||
Maximum [Member] | ||||||||
Subsidiary or Equity Method Investee [Line Items] | ||||||||
Period of receiving anticipated returns | 12 months | |||||||
North Carolina [Member] | ||||||||
Subsidiary or Equity Method Investee [Line Items] | ||||||||
Square footage of facility purchased | ft² | 800,000 | |||||||
Purchase price of facility | $ 22,200,000 | |||||||
California [Member] | ||||||||
Subsidiary or Equity Method Investee [Line Items] | ||||||||
Number of office buildings purchased | Building | 1 | |||||||
Payments to acquire office buildings | $ 29,600,000 | |||||||
Deferred rent liability | 1,100,000 | |||||||
China [Member] | ||||||||
Subsidiary or Equity Method Investee [Line Items] | ||||||||
Goodwill | $ 3,300,000 | 3,100,000 | ||||||
Other operating income | $ 50,800,000 | $ 34,200,000 | $ 6,500,000 | |||||
Buildings [Member] | ||||||||
Subsidiary or Equity Method Investee [Line Items] | ||||||||
Estimated useful life | 40 years | |||||||
Buildings [Member] | North Carolina [Member] | ||||||||
Subsidiary or Equity Method Investee [Line Items] | ||||||||
Property plant and equipment at fair value | 18,800,000 | |||||||
Buildings [Member] | California [Member] | ||||||||
Subsidiary or Equity Method Investee [Line Items] | ||||||||
Property plant and equipment at fair value | 16,900,000 | |||||||
Land [Member] | North Carolina [Member] | ||||||||
Subsidiary or Equity Method Investee [Line Items] | ||||||||
Property plant and equipment at fair value | $ 3,400,000 | |||||||
Land [Member] | California [Member] | ||||||||
Subsidiary or Equity Method Investee [Line Items] | ||||||||
Property plant and equipment at fair value | $ 11,600,000 | |||||||
Furniture, Fixtures and Equipment [Member] | Minimum [Member] | ||||||||
Subsidiary or Equity Method Investee [Line Items] | ||||||||
Estimated useful life | 3 years | |||||||
Furniture, Fixtures and Equipment [Member] | Maximum [Member] | ||||||||
Subsidiary or Equity Method Investee [Line Items] | ||||||||
Estimated useful life | 10 years | |||||||
Building Improvements [Member] | Minimum [Member] | ||||||||
Subsidiary or Equity Method Investee [Line Items] | ||||||||
Estimated useful life | 10 years | |||||||
Building Improvements [Member] | Maximum [Member] | ||||||||
Subsidiary or Equity Method Investee [Line Items] | ||||||||
Estimated useful life | 15 years | |||||||
Accounting Standards Update 2016-09 [Member] | ||||||||
Subsidiary or Equity Method Investee [Line Items] | ||||||||
Excess tax benefits | $ 31,100,000 | |||||||
Deferred tax assets, gross | $ 29,600,000 |
Basis of Presentation - Net Pro
Basis of Presentation - Net Property, Plant and Equipment (Detail) - USD ($) $ in Millions | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 |
Property, plant and equipment — at cost: | |||
Land and building | $ 51 | $ 51 | |
Furniture and fixtures | 26.7 | 25.9 | |
Equipment | 803.5 | 719.8 | |
Building and leasehold improvements | 199 | 185.7 | |
Property, plant and equipment - at cost | 1,080.2 | 982.4 | |
Less: accumulated depreciation and amortization | (702.7) | (604.4) | |
Net property, plant and equipment | $ 377.5 | $ 378 | $ 339.2 |
Basis of Presentation - Computa
Basis of Presentation - Computation of Basic and Diluted Earnings Per Share (Detail) - shares shares in Millions | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Earnings Per Share [Abstract] | |||
Weighted average shares used in basic computations | 79.2 | 83 | 82.6 |
Dilutive effect of exercise of equity grants outstanding | 3.7 | 3.1 | 2.7 |
Weighted average shares used in diluted computations | 82.9 | 86.1 | 85.3 |
Inventories - Classes of Invent
Inventories - Classes of Inventory (Detail) - USD ($) $ in Millions | Dec. 31, 2017 | Dec. 31, 2016 |
Inventory Disclosure [Abstract] | ||
Raw materials | $ 44.2 | $ 49.3 |
Work in process | 4.8 | 3.9 |
Finished goods | 292.2 | 318.1 |
Total | $ 341.2 | $ 371.3 |
Long-Term Debt - Schedule of Lo
Long-Term Debt - Schedule of Long-Term Debt (Detail) - USD ($) $ in Millions | Dec. 31, 2017 | Dec. 31, 2016 |
Debt Instrument [Line Items] | ||
Convertible senior notes, carrying value of liability component | $ 1,070 | $ 1,024.8 |
Other | 7.9 | 13.1 |
Total | 2,268.1 | 1,447.9 |
Less: current portion | 102.4 | 9.5 |
Long-term portion | 2,165.7 | 1,438.4 |
Prior Senior Secured Credit Facility [Member] | ||
Debt Instrument [Line Items] | ||
Borrowings under senior secured credit facility, carrying value | $ 410 | |
New Senior Secured Credit Facility [Member] | ||
Debt Instrument [Line Items] | ||
Borrowings under senior secured credit facility, carrying value | $ 1,190.2 |
Long-Term Debt - Additional Inf
Long-Term Debt - Additional Information (Detail) | Jun. 30, 2017USD ($) | Sep. 30, 2015USD ($) | May 04, 2015USD ($) | Feb. 15, 2017USD ($) | Feb. 28, 2014USD ($)$ / shares | Mar. 31, 2014USD ($) | Dec. 31, 2017USD ($)Day$ / shares | Dec. 31, 2016USD ($)$ / shares | Dec. 31, 2015USD ($)$ / shares | Jul. 26, 2012USD ($) | Mar. 09, 2011USD ($) |
Debt Instrument [Line Items] | |||||||||||
Deferred financing costs | $ 6,200,000 | ||||||||||
Outstanding principal amount | $ 2,384,700,000 | ||||||||||
Credit facility, amount repaid | 483,100,000 | ||||||||||
Interest expense | 160,800,000 | $ 99,300,000 | $ 100,500,000 | ||||||||
Amortization of deferred financing costs | 8,400,000 | 7,900,000 | 8,500,000 | ||||||||
Paid-in-capital in excess of par value | 407,300,000 | 467,600,000 | |||||||||
Long-term debt | 2,268,100,000 | 1,447,900,000 | |||||||||
Convertible senior notes, carrying value of liability component | 1,070,000,000 | 1,024,800,000 | |||||||||
Letters of credit issued but undrawn | 40,800,000 | ||||||||||
Prepaid forward share repurchase transactions [Member] | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Forward share repurchase transactions amount | $ 685,800,000 | $ 685,800,000 | |||||||||
Capped call transactions [Member] | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Capped call transactions with financial institutions | 123,800,000 | ||||||||||
Senior secured prior revolving credit facility [Member] | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Repayment of prior senior secured credit facility | $ 410,000,000 | ||||||||||
Credit facility, amount repaid | $ 410,000,000 | 429,700,000 | |||||||||
Credit facility, amount borrowed | $ 200,000,000 | ||||||||||
Prior Senior Secured Credit Facility [Member] | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Credit facility amendment date | May 4, 2015 | ||||||||||
Credit facility interest rate description | After March 9, 2016, the applicable interest rates on the Company’s borrowings under the Prior Credit Facility increased by 2.00% such that borrowings under the Prior Credit Facility began bearing interest at either LIBOR plus the applicable margin between 4.00% and 5.00% or the base rate plus the applicable margin between 3.00% and 4.00% | ||||||||||
Amount required to maintain on consolidated cash and cash equivalents | $ 200,000,000 | ||||||||||
Long-term debt, weighted average interest rate | 4.29% | ||||||||||
Senior secured revolving credit facility [Member] | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Borrowings under the senior secured credit facility | 0 | ||||||||||
Term Loan [Member] | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Credit facility prepayments | 0 | ||||||||||
Quarterly periodic payment, Principal | $ 24,400,000 | ||||||||||
Interest expense | 82,200,000 | ||||||||||
Non-cash interest expense | 4,200,000 | ||||||||||
Amortization of deferred financing costs | 2,800,000 | ||||||||||
Term Loan [Member] | Level 2 [Member] | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Outstanding principal amount | 1,190,200,000 | ||||||||||
Debt instrument, fair value | 1,226,100,000 | ||||||||||
Convertible Debt [Member] | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Deferred financing costs | 26,600,000 | ||||||||||
Outstanding principal amount | 1,150,000,000 | 1,150,000,000 | $ 1,150,000,000 | ||||||||
Interest expense | 68,200,000 | 65,300,000 | 61,700,000 | ||||||||
Non-cash interest expense | 41,200,000 | 38,600,000 | 35,700,000 | ||||||||
Amortization of deferred financing costs | $ 4,000,000 | $ 3,800,000 | $ 3,200,000 | ||||||||
Aggregate principal amount of convertible senior notes issued | 1,000,000,000 | ||||||||||
Additional principal amount of convertible notes | $ 150,000,000 | ||||||||||
Convertible notes, interest rate | 2.00% | ||||||||||
Convertible notes maturity | Aug. 15, 2019 | ||||||||||
Convertible notes, conversion feature | Holders of the Convertible Notes may convert their notes at their option under the following circumstances: (i) during any calendar quarter commencing after the calendar quarter ending March 31, 2014, if the last reported sale price of the Company’s common shares for at least 20 trading days (whether or not consecutive) in a period of 30 consecutive trading days ending on, and including, the last trading day of the immediately preceding calendar quarter exceeds 130% of the conversion price for the Convertible Notes on each applicable trading day; (ii) during the five business-day period immediately after any five consecutive trading day period, or the measurement period, in which the trading price per $1,000 principal amount of Convertible Notes for each trading day of that measurement period was less than 98% of the product of the last reported sale price of the Company’s common shares and the conversion rate for the Convertible Notes for each such day; or (iii) upon the occurrence of specified corporate events. On and after May 15, 2019, holders may convert their Convertible Notes at any time, regardless of the foregoing circumstances. | ||||||||||
Convertible notes, number of trading days of threshold limit (whether or not consecutive) | Day | 20 | ||||||||||
Convertible notes, number of trading days of threshold limit in consecutive days | Day | 30 | ||||||||||
Minimum percentage of common share price over conversion price for conversion | 130.00% | ||||||||||
Principal amount of convertible notes | $ 1,000 | ||||||||||
Minimum percentage of the product of common share price and conversion rate for convertible notes | 98.00% | ||||||||||
Convertible notes initial conversion rate | 11.5908 | ||||||||||
Convertible notes initial conversion price | $ / shares | $ 86.28 | $ 86.28 | $ 86.28 | ||||||||
Paid-in-capital in excess of par value | $ 219,100,000 | 5,100,000 | |||||||||
Proceeds received from the issuance of the Convertible notes | 1,150,000,000 | ||||||||||
Long-term debt | $ 930,900,000 | ||||||||||
Effective interest rate on convertible notes | 6.20% | ||||||||||
Unamortized debt discount and debt issuance costs | $ 80,000,000 | $ 125,200,000 | |||||||||
Convertible senior notes, carrying value of liability component | 1,070,000,000 | 1,024,800,000 | |||||||||
Fair value of liability to convertible notes | $ 1,066,000,000 | 961,300,000 | |||||||||
Convertible Debt [Member] | Debt Issuance Costs [Member] | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Deferred financing costs | $ 21,500,000 | ||||||||||
Convertible Debt [Member] | Capped call transactions [Member] | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Convertible notes initial conversion price | $ / shares | $ 86.28 | ||||||||||
Base Rate [Member] | Senior secured prior revolving credit facility [Member] | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Variable rate basis | Facility increased by 2.00% such that borrowings under the Prior Credit Facility began bearing interest at either LIBOR plus the applicable margin between 4.00% and 5.00% or the base rate plus the applicable margin between 3.00% and 4.00% | ||||||||||
Base rate interest rate floor | 1.75% | ||||||||||
Senior Secured Credit Facility [Member] | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Credit facility, maximum amount | $ 1,450,000,000 | ||||||||||
Deferred financing costs | $ 22,600,000 | ||||||||||
Senior secured credit facility, discount percentage | 2.00% | ||||||||||
Senior secured credit facility, discount amount | $ 26,000,000 | ||||||||||
Line of credit facility, frequency of interest payments | quarterly | ||||||||||
Long-term debt, weighted average interest rate | 6.79% | ||||||||||
Senior Secured Credit Facility [Member] | Senior secured prior revolving credit facility [Member] | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Line of credit facility extended maturity period | 1 year | ||||||||||
Credit facility prepayments | 50,900,000 | ||||||||||
Credit facility, maximum amount | $ 425,000,000 | $ 700,000,000 | |||||||||
Amended maturity date of credit facility | Mar. 9, 2017 | ||||||||||
Decreased amount in credit facility borrowing capacity | $ (39,100,000) | (235,900,000) | |||||||||
Borrowings under the senior secured credit facility | 410,000,000 | ||||||||||
Foreign currency borrowings, outstanding | $ 0 | $ 0 | |||||||||
Senior Secured Credit Facility [Member] | Senior secured revolving credit facility [Member] | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Credit facility, maximum amount | $ 150,000,000 | ||||||||||
Credit facility, maturity date | Feb. 15, 2022 | ||||||||||
Credit facility LIBOR minimum floor rate interest | 0.75% | ||||||||||
Line of Credit Facility, Unused Capacity, Commitment Fee Percentage | 0.50% | ||||||||||
Senior Secured Credit Facility [Member] | Senior secured revolving credit facility [Member] | Convertible Notes Exceeds 250 Million [Member] | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Credit facility, maturity date | Feb. 14, 2019 | ||||||||||
Senior Secured Credit Facility [Member] | Minimum [Member] | Convertible Notes Exceeds 250 Million [Member] | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Outstanding principal amount | $ 250,000,000 | ||||||||||
Senior Secured Credit Facility [Member] | Prior Term Loan [Member] | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Credit facility prepayments | $ 20,300,000 | ||||||||||
Credit facility, maximum amount | $ 500,000,000 | ||||||||||
Senior Secured Credit Facility [Member] | Term Loan [Member] | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Outstanding principal amount | $ 1,300,000,000 | ||||||||||
Credit facility, maturity date | Feb. 15, 2023 | ||||||||||
Borrowings under the senior secured credit facility | $ 1,226,900,000 | ||||||||||
Senior Secured Credit Facility [Member] | Term Loan [Member] | Convertible Notes Exceeds 250 Million [Member] | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Credit facility, maturity date | May 16, 2019 | ||||||||||
Senior Secured Credit Facility [Member] | LIBOR [Member] | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Interest rate spread on variable rate | 1.00% | ||||||||||
Senior Secured Credit Facility [Member] | LIBOR [Member] | Senior secured prior revolving credit facility [Member] | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Credit facility LIBOR minimum floor rate interest | 0.25% | ||||||||||
Senior Secured Credit Facility [Member] | Base Rate [Member] | Term Loan [Member] | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Interest rate spread on variable rate | 4.50% | ||||||||||
Senior Secured Credit Facility [Member] | Eurodollar [Member] | Term Loan [Member] | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Interest rate spread on variable rate | 5.50% | ||||||||||
Senior Secured Credit Facility [Member] | Federal Funds Rate [Member] | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Interest rate spread on variable rate | 0.50% | ||||||||||
Senior secured revolving credit facility [Member] | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Borrowings under the senior secured credit facility | $ 0 | ||||||||||
Until March 9, 2016 [Member] | Senior Secured Credit Facility [Member] | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Interest rate spread on variable rate increase by percentage | 0.50% | ||||||||||
After March 9, 2016 [Member] | Senior Secured Credit Facility [Member] | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Interest rate increased by percentage | 2.00% | ||||||||||
After March 9, 2016 [Member] | Senior Secured Credit Facility [Member] | LIBOR [Member] | Minimum [Member] | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Interest rate spread on variable rate | 4.00% | ||||||||||
After March 9, 2016 [Member] | Senior Secured Credit Facility [Member] | LIBOR [Member] | Maximum [Member] | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Interest rate spread on variable rate | 5.00% | ||||||||||
After March 9, 2016 [Member] | Senior Secured Credit Facility [Member] | Base Rate [Member] | Minimum [Member] | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Interest rate spread on variable rate | 3.00% | ||||||||||
After March 9, 2016 [Member] | Senior Secured Credit Facility [Member] | Base Rate [Member] | Maximum [Member] | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Interest rate spread on variable rate | 4.00% | ||||||||||
Until August 15, 2017 [Member] | Senior Secured Credit Facility [Member] | Base Rate [Member] | Senior secured revolving credit facility [Member] | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Interest rate spread on variable rate | 3.75% | ||||||||||
Until August 15, 2017 [Member] | Senior Secured Credit Facility [Member] | Eurodollar [Member] | Senior secured revolving credit facility [Member] | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Interest rate spread on variable rate | 4.75% | ||||||||||
Scenario Leverage Ratio One [Member] | Senior Secured Credit Facility [Member] | Base Rate [Member] | Senior secured revolving credit facility [Member] | After August 15, 2017 [Member] | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Interest rate spread on variable rate | 3.50% | ||||||||||
Scenario Leverage Ratio One [Member] | Senior Secured Credit Facility [Member] | Eurodollar [Member] | Senior secured revolving credit facility [Member] | After August 15, 2017 [Member] | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Interest rate spread on variable rate | 4.50% | ||||||||||
Scenario Leverage Ratio Two [Member] | Senior Secured Credit Facility [Member] | Base Rate [Member] | Senior secured revolving credit facility [Member] | After August 15, 2017 [Member] | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Interest rate spread on variable rate | 3.75% | ||||||||||
Scenario Leverage Ratio Two [Member] | Senior Secured Credit Facility [Member] | Eurodollar [Member] | Senior secured revolving credit facility [Member] | After August 15, 2017 [Member] | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Interest rate spread on variable rate | 4.75% |
Long-Term Debt - Annual Schedul
Long-Term Debt - Annual Scheduled Principal Payments of Debt (Detail) $ in Millions | Dec. 31, 2017USD ($) |
Debt Disclosure [Abstract] | |
2,018 | $ 102.4 |
2,019 | 1,250 |
2,020 | 97.9 |
2,021 | 97.5 |
2,022 | 97.5 |
Thereafter | 739.4 |
Total | $ 2,384.7 |
Lease Obligations - Future Mini
Lease Obligations - Future Minimum Rental Commitments for Non-Cancelable Operating Leases (Detail) $ in Millions | Dec. 31, 2017USD ($) |
Leases [Abstract] | |
2,018 | $ 51.6 |
2,019 | 42.7 |
2,020 | 30.2 |
2,021 | 17.7 |
2,022 | 13.6 |
Thereafter | 73.2 |
Total | $ 229 |
Lease Obligations - Additional
Lease Obligations - Additional Information (Detail) - USD ($) | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Leases [Abstract] | |||
Rental expense | $ 56,200,000 | $ 53,400,000 | $ 58,000,000 |
Property, plant and equipment under capital leases | $ 0 | $ 0 |
Employee Compensation Plans - A
Employee Compensation Plans - Additional Information (Detail) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Compensation Related Costs [Abstract] | |||
Contribution made by company to its profit sharing plan | $ 4.8 | $ 4.8 | $ 4.3 |
Expenses relating to international deferred compensation plans | $ 6.4 | 5.8 | 5.5 |
Percentage of matching contribution related to the Management Deferred Compensation Plan and the Senior Executive Deferred Compensation Plan | 3.50% | ||
Deferred compensation plans expense excluding participant contributions | $ 6.7 | 3.6 | $ 0.1 |
Total long-term deferred compensation liability | 58.1 | 50 | |
Value of the assets in the rabbi trust | $ 33.6 | $ 30.6 |
Contingencies - Additional Info
Contingencies - Additional Information (Detail) - USD ($) | 12 Months Ended | ||||||||
Dec. 31, 2017 | Aug. 31, 2017 | Dec. 31, 2016 | Dec. 29, 2016 | Jul. 31, 2016 | Jan. 31, 2016 | May 10, 2013 | May 07, 2010 | Sep. 30, 2009 | |
Loss Contingencies [Line Items] | |||||||||
Other assets | $ 250,300,000 | $ 324,900,000 | |||||||
Prepaid expenses and other current assets | 147,000,000 | $ 176,900,000 | |||||||
Deductible for product liability insurance | 12,500,000 | ||||||||
Herbalife International of America, Inc., [Member] | U.S. Federal Trade Commission [Member] | |||||||||
Loss Contingencies [Line Items] | |||||||||
Settlement amount paid for consent order | $ 200,000,000 | ||||||||
Third-party monitoring by independent compliance auditor, period | 7 years | ||||||||
Implement of new and enhance existing procedures, period | 10 months | ||||||||
Federal Revenue Office of Brazil [Member] | |||||||||
Loss Contingencies [Line Items] | |||||||||
Assessment amount from tax administration service | $ 5,300,000 | $ 2,100,000 | |||||||
Mexican Tax Administration Service [Member] | |||||||||
Loss Contingencies [Line Items] | |||||||||
Assessment amount from tax administration service | $ 14,900,000 | $ 58,300,000 | |||||||
Surety bond through insurance company to guarantee payment of tax assessment | $ 17,600,000 | ||||||||
Other assets current and non current | 41,200,000 | ||||||||
Other assets | 35,300,000 | ||||||||
Prepaid expenses and other current assets | 5,900,000 | ||||||||
Loss related to other assets | 0 | ||||||||
Brazilian ICMS [Member] | |||||||||
Loss Contingencies [Line Items] | |||||||||
Assessment amount from tax administration service | 7,300,000 | ||||||||
Surety bond through insurance company to guarantee payment of tax assessment | 13,100,000 | ||||||||
Other assets current and non current | 11,700,000 | ||||||||
Other assets | 4,400,000 | ||||||||
Prepaid expenses and other current assets | 7,300,000 | ||||||||
Brazilian ICMS [Member] | State of Sao Paulo [Member] | |||||||||
Loss Contingencies [Line Items] | |||||||||
Assessment amount from tax administration service | $ 18,000,000 | $ 48,500,000 | |||||||
Indian VAT Authorities [Member] | |||||||||
Loss Contingencies [Line Items] | |||||||||
Assessment amount from tax administration service | 8,300,000 | ||||||||
South Korean Customs Authority [Member] | Other Noncurrent Assets [Member] | |||||||||
Loss Contingencies [Line Items] | |||||||||
Assessment amount from tax administration service | $ 33,200,000 | ||||||||
Greek Social Security Agency [Member] | |||||||||
Loss Contingencies [Line Items] | |||||||||
Assessment amount from tax administration service | $ 2,400,000 |
Shareholders' (Deficit) Equit51
Shareholders' (Deficit) Equity - Additional Information (Detail) - USD ($) | 1 Months Ended | 3 Months Ended | 12 Months Ended | |||||
Oct. 31, 2017 | Feb. 28, 2014 | Mar. 31, 2014 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | Jan. 31, 2018 | Feb. 21, 2017 | |
Stockholders Equity [Line Items] | ||||||||
Common shares, shares outstanding | 82,300,000 | 93,100,000 | 92,700,000 | |||||
Preference shares authorized | 7,500,000 | |||||||
Preference shares par value | $ 0.002 | |||||||
Dividends paid | $ 0 | $ 0 | $ 0 | |||||
Share repurchase program authorized amount | 1,500,000,000 | $ 1,500,000,000 | $ 1,500,000,000 | |||||
Share repurchase program, remaining authorized capacity | $ 713,600,000 | $ 233,000,000 | ||||||
Share repurchase program expiration date | Feb. 21, 2020 | Jun. 30, 2017 | ||||||
Share repurchase transaction, shares to be purchased | 9,900,000 | |||||||
Retained earnings (accumulated deficit) | $ (248,100,000) | $ (66,300,000) | ||||||
Repurchase of common stock, shares | 12,700,000 | 200,000 | 400,000 | |||||
Repurchase of common stock, value | $ 855,700,000 | $ 13,200,000 | $ 16,600,000 | |||||
Treasury stock shares, at cost | 5,000,000 | |||||||
Shares repurchases, inclusive of transaction costs and issuance of CVR value | $ 795,300,000 | 0 | 0 | |||||
Withheld for tax purpose for share-based compensation plans | 60,400,000 | 13,200,000 | 16,600,000 | |||||
Payments for share repurchases | 844,200,000 | 13,200,000 | 16,600,000 | |||||
Share repurchases for which subsequent payment to be made | 4,200,000 | |||||||
Other comprehensive income (loss) before foreign currency translation adjustments reclassifications, Tax expense (benefits) | $ 5,700,000 | 5,200,000 | (7,200,000) | |||||
Other comprehensive Unrealized Gain (Loss) on Derivatives before reclassifications, Tax expense (benefits) | (300,000) | (600,000) | ||||||
Amounts reclassified from accumulated other comprehensive income (loss) to income, tax expense (benefits), other | 100,000 | |||||||
Other comprehensive Unrealized Gain (Loss) on Available-For-Sale Investments before reclassifications, Tax expense (benefits) | (900,000) | |||||||
Amounts reclassified from accumulated other comprehensive income (loss) to income, tax expense (benefits) unrealized gain (loss) on available-for-sale investments | 800,000 | |||||||
Capped call transactions [Member] | ||||||||
Stockholders Equity [Line Items] | ||||||||
Capped call transactions with financial institutions | $ 123,800,000 | |||||||
Capped call transactions price per common share | $ 120.79 | |||||||
Increase (decrease) in additional paid-in capital, other | $ (123,800,000) | |||||||
Capped call transactions [Member] | Convertible Notes [Member] | ||||||||
Stockholders Equity [Line Items] | ||||||||
Convertible notes initial conversion price | $ 86.28 | |||||||
Prepaid forward share repurchase transactions [Member] | ||||||||
Stockholders Equity [Line Items] | ||||||||
Forward share repurchase transactions amount | $ 685,800,000 | 685,800,000 | ||||||
Share repurchase transaction, shares to be purchased | 9,900,000 | |||||||
Average cost per share of shares repurchased | $ 69.02 | |||||||
Settlement date of forward transactions | Aug. 15, 2019 | |||||||
Retained earnings (accumulated deficit) | (653,900,000) | |||||||
Additional paid-in-capital | 31,900,000 | |||||||
Non-cash forward transaction issuance costs | $ 35,800,000 | |||||||
Non-cash interest expense relating to amortization of non-cash issuance costs | $ 6,500,000 | $ 6,500,000 | $ 6,500,000 | |||||
Open market purchases [Member] | ||||||||
Stockholders Equity [Line Items] | ||||||||
Average cost per share of shares repurchased | $ 66.98 | |||||||
Repurchase of common stock, shares | 11,700,000 | 0 | 0 | |||||
Repurchase of common stock, value | $ 786,400,000 | |||||||
Open market purchases [Member] | Indirect wholly owned subsidiary [Member] | ||||||||
Stockholders Equity [Line Items] | ||||||||
Average cost per share of shares repurchased | $ 65.61 | |||||||
Repurchase of common stock, shares | 5,000,000 | |||||||
Repurchase of common stock, value | $ 328,600,000 | |||||||
Dutch Auction Tender Offer [Member] | ||||||||
Stockholders Equity [Line Items] | ||||||||
Forward share repurchase transactions amount | $ 1,600,000 | |||||||
Average cost per share of shares repurchased | $ 68 | |||||||
Repurchase of common stock, shares | 6,700,000 | |||||||
Repurchase of common stock, value | $ 457,800,000 | |||||||
Contingent value right agreement term | 2 years | |||||||
Non-transferable contractual contingent value right agreement initial fair value | $ 7,300,000 | $ 6,900,000 | ||||||
CVR expiration period | 2019-08 |
Shareholders' (Deficit) Equit52
Shareholders' (Deficit) Equity - Summary of Changes in Accumulated Other Comprehensive Income (Loss) (Detail) - USD ($) $ in Millions | 12 Months Ended | |||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | ||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||
Beginning Balance | $ 196.3 | $ (53.5) | $ (334.4) | |
Other comprehensive income (loss) before reclassifications, net of tax | 37 | (24.1) | (72.9) | |
Amounts reclassified from accumulated other comprehensive income (loss) to income, net of tax | [1] | 2.7 | (15.5) | (14.4) |
Total other comprehensive income (loss) | 39.7 | (39.6) | (87.3) | |
Ending Balance | (334.7) | 196.3 | (53.5) | |
Foreign Currency Translation Adjustments [Member] | ||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||
Beginning Balance | (215.5) | (183) | (96.4) | |
Other comprehensive income (loss) before reclassifications, net of tax | 44.9 | (32.5) | (86.6) | |
Total other comprehensive income (loss) | 44.9 | (32.5) | (86.6) | |
Ending Balance | (170.6) | (215.5) | (183) | |
Unrealized Gain (Loss) on Derivatives [Member] | ||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||
Beginning Balance | 10.4 | 17.4 | 18 | |
Other comprehensive income (loss) before reclassifications, net of tax | (7.9) | 8.4 | 15.4 | |
Amounts reclassified from accumulated other comprehensive income (loss) to income, net of tax | [1] | 2.7 | (15.4) | (16) |
Total other comprehensive income (loss) | (5.2) | (7) | (0.6) | |
Ending Balance | 5.2 | 10.4 | 17.4 | |
Unrealized Gain (Loss) on Available-For-Sale Investments [Member] | ||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||
Beginning Balance | 0.1 | 0.2 | ||
Other comprehensive income (loss) before reclassifications, net of tax | (1.7) | |||
Amounts reclassified from accumulated other comprehensive income (loss) to income, net of tax | [1] | (0.1) | 1.6 | |
Total other comprehensive income (loss) | (0.1) | (0.1) | ||
Ending Balance | 0.1 | |||
Accumulated Other Comprehensive Loss [Member] | ||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||
Beginning Balance | (205.1) | (165.5) | (78.2) | |
Ending Balance | $ (165.4) | $ (205.1) | $ (165.5) | |
[1] | See Note 2, Basis of Presentation, and Note 11, Derivative Instruments and Hedging Activities, for information regarding the location in the consolidated statements of income of gains (losses) reclassified from accumulated other comprehensive income (loss) into income during the years ended December 31, 2017, 2016, and 2015. |
Share-Based Compensation - Addi
Share-Based Compensation - Additional Information (Detail) | 12 Months Ended | ||
Dec. 31, 2017USD ($)Plan$ / sharesshares | Dec. 31, 2016USD ($)$ / sharesshares | Dec. 31, 2015USD ($)$ / sharesshares | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Number of share-based compensation plans | Plan | 4 | ||
Common shares authorized under 2014 Stock Incentive Plan | shares | 8,700,000 | ||
Common shares remain for future issuance under share-based compensation plans | shares | 4,200,000 | ||
Realized income tax benefit for all awards | $ 9,400,000 | $ 14,800,000 | $ 16,600,000 |
Awards granted | shares | 0 | 0 | 0 |
Total vesting date fair value of stock units | $ 2,000,000 | $ 2,100,000 | $ 1,300,000 |
Reserved for issuance under employee stock purchase plan | shares | 2,000,000 | ||
Future issuance of employee stock purchase plan | shares | 1,700,000 | ||
Percent of fair market value for which eligible employees can purchase common shares under employee stock purchase plan | 85.00% | ||
Performance conditions [Member] | First Succeeding Year [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Performance stock unit awards vesting percentage | 20.00% | ||
Performance conditions [Member] | Second Succeeding Year [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Performance stock unit awards vesting percentage | 20.00% | ||
Performance conditions [Member] | Third Succeeding Year [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Performance stock unit awards vesting percentage | 60.00% | ||
Independent Director Stock Units [Member] | Performance conditions [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Vesting period beginning from the grant date | 1 year | ||
Chief Executive Officer [Member] | Performance conditions [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Performance stock unit awards vesting date | Dec. 31, 2019 | ||
Chief Executive Officer [Member] | Performance conditions [Member] | Minimum [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Performance stock unit awards vesting percentage | 0.00% | ||
Chief Executive Officer [Member] | Performance conditions [Member] | Maximum [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Performance stock unit awards vesting percentage | 200.00% | ||
Stock Options [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Vesting period beginning from the grant date | 5 years | ||
Contractual term | 10 years | ||
SARs [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Contractual term | 10 years | ||
Awards granted | shares | 0 | 0 | 0 |
SARs [Member] | Stock Incentive Plan Other [Member] | Performance conditions [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Vesting period beginning from the grant date | 3 years | ||
Service condition awards [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Share-based compensation expense | $ 24,400,000 | $ 23,900,000 | $ 26,800,000 |
Unrecognized compensation cost on non-vested stock awards | $ 29,200,000 | ||
Unrecognized compensation cost on non-vested stock awards, weighted-average period of recognition | 1 year 4 months 24 days | ||
Weighted-average grant date fair value of SARs granted | $ / shares | $ 28.64 | $ 29.33 | $ 12.57 |
Total intrinsic value of awards exercised for options and SARs | $ 122,800,000 | $ 32,300,000 | $ 25,500,000 |
Performance condition awards [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Share-based compensation expense | 16,400,000 | $ 15,900,000 | $ 17,800,000 |
Unrecognized compensation cost on non-vested stock awards | $ 15,100,000 | ||
Unrecognized compensation cost on non-vested stock awards, weighted-average period of recognition | 1 year 8 months 12 days | ||
Weighted-average grant date fair value of SARs granted | $ / shares | $ 28.32 | $ 29.69 | $ 13.65 |
Total intrinsic value of awards exercised for options and SARs | $ 3,100,000 | $ 700,000 | |
Market condition awards [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Share-based compensation expense | $ 1,300,000 | 400,000 | $ 300,000 |
Unrecognized compensation cost on non-vested stock awards, weighted-average period of recognition | 2 months 12 days | ||
Total intrinsic value of awards exercised for options and SARs | $ 0 | 0 | 11,400,000 |
Market condition awards [Member] | Maximum [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Unrecognized compensation cost on non-vested stock awards | 100,000 | ||
Market and performance condition awards [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Share-based compensation expense | $ 0 | $ 0 | $ 0 |
Management Plan [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Additional awards | shares | 0 | ||
2004 Stock Incentive Plan [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Additional awards | shares | 0 | ||
2005 Stock Incentive Plan [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Additional awards | shares | 0 | ||
Stock Incentive Plan [Member] | Performance conditions [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Vesting period beginning from the grant date | 3 years | ||
Contractual term | 3 years |
Share-Based Compensation - Weig
Share-Based Compensation - Weighted Average Assumptions Use in Calculation of Fair Value for Service, Performance Condition, and Market and Performance Condition Awards (Detail) | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
SARs [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Expected volatility | 49.20% | 49.60% | 48.70% |
Dividends yield | 0.00% | 0.10% | 1.60% |
Expected term | 6 years | 6 years | 5 years 9 months 18 days |
Risk-free interest rate | 2.20% | 1.20% | 1.60% |
Performance condition awards [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Expected volatility | 49.60% | 49.60% | 48.80% |
Dividends yield | 0.00% | 0.00% | 1.60% |
Expected term | 6 years 1 month 6 days | 6 years | 5 years 9 months 18 days |
Risk-free interest rate | 2.20% | 1.20% | 1.60% |
Share-Based Compensation - Summ
Share-Based Compensation - Summary of Activity Under Share-Based Compensation Plans (Detail) - USD ($) $ / shares in Units, shares in Thousands, $ in Millions | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
SARs [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Awards Outstanding, Beginning Balance | 11,998 | |
Granted, Awards | 1,362 | |
Exercised, Awards | (3,394) | |
Forfeited, Awards | (369) | |
Awards Outstanding, Ending Balance | 9,597 | 11,998 |
Exercisable Awards, Ending Balance | 5,438 | |
Weighted Average Exercise Price Outstanding, Beginning Balance | $ 41.52 | |
Granted, Weighted Average Exercise Price | 57.33 | |
Exercised, Weighted Average Exercise Price | 31.86 | |
Forfeited, Weighted Average Exercise Price | 53.59 | |
Weighted Average Exercise Price Outstanding, Ending Balance | 46.72 | $ 41.52 |
Exercisable, Weighted Average Exercise Price, Ending Balance | $ 46.30 | |
Weighted Average Remaining Contractual Term Outstanding | 6 years 2 months 12 days | 6 years |
Exercisable Weighted Average Remaining Contractual Term | 4 years 9 months 18 days | |
Aggregate Intrinsic Value Outstanding | $ 212 | $ 148.7 |
Exercisable, Aggregate Intrinsic Value | $ 126.9 | |
Incentive Plan and Independent Directors Stock Units [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Outstanding and nonvested as of December 31, 2016, Shares | 26 | |
Granted, Shares | 162 | |
Vested, Shares | (25) | |
Outstanding and nonvested as of December 31, 2017, Shares | 163 | 26 |
Outstanding and nonvested as of December 31, 2016, Weighted Average Grant Date Fair Value | $ 62.35 | |
Granted, Weighted Average Grant Date Fair Value | 68.74 | |
Vested, Weighted Average Grant Date Fair Value | 62.40 | |
Outstanding and nonvested as of December 31, 2017, Weighted Average Grant Date Fair Value | $ 68.69 | $ 62.35 |
Share-Based Compensation - Su56
Share-Based Compensation - Summary of Activity Under Share-Based Compensation Plans (Parenthetical) (Detail) - shares | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Market condition awards [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Outstanding SARs | 100,000 | 100,000 |
Performance condition SARs [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Outstanding SARs | 3,100,000 | 2,900,000 |
Exercisable SARs | 1,500,000 | |
Performance Based Stock Unit Awards [Member] | Maximum [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Number of share based payment awards other than options that can vest maximum | 134,388 |
Segment Information - Additiona
Segment Information - Additional Information (Detail) $ in Millions | 12 Months Ended | |||
Dec. 31, 2017USD ($)SegmentCountry | Dec. 31, 2016USD ($) | Dec. 31, 2015USD ($) | Dec. 31, 2014USD ($) | |
Segment Reporting Information [Line Items] | ||||
Number of countries in which the Company sells products | Country | 94 | |||
Number of reportable segments | Segment | 2 | |||
Goodwill allocated to the Company's Segment | $ 96.9 | $ 89.9 | ||
Cash and cash equivalents | 1,278.8 | 844 | $ 889.8 | $ 645.4 |
Total amount of cash held by foreign subsidiaries maintained or invested in U.S. dollars | 633.3 | 28.2 | ||
Primary Reporting Segment [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Goodwill allocated to the Company's Segment | 93.6 | 86.8 | ||
China [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Goodwill allocated to the Company's Segment | 3.3 | 3.1 | ||
Foreign countries [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Cash and cash equivalents | 1,133.5 | 316.2 | ||
United States [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Cash and cash equivalents | $ 145.3 | $ 527.8 |
Segment Information - Reconcili
Segment Information - Reconciliation of Revenue from Segments to Consolidated (Detail) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | |||||||||||
Dec. 31, 2017 | [1] | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2016 | [1] | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||||||||||
Total Net Sales | $ 1,093.3 | $ 1,085.4 | $ 1,146.9 | $ 1,102.1 | $ 1,045 | $ 1,122 | $ 1,201.8 | $ 1,119.6 | $ 4,427.7 | $ 4,488.4 | $ 4,469 | ||
Primary Reporting Segment [Member] | |||||||||||||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||||||||||
Total Net Sales | 3,541.8 | 3,619.6 | 3,622.8 | ||||||||||
China [Member] | |||||||||||||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||||||||||
Total Net Sales | $ 885.9 | $ 868.8 | $ 846.2 | ||||||||||
[1] | Includes the impact of the U.S. Tax Reform enacted during the fourth quarter of 2017, as described further in Note 12, Income Taxes. |
Segment Information - Reconci59
Segment Information - Reconciliation of Operating Profit (Loss) from Segments to Consolidated (Detail) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | |||||||||||
Dec. 31, 2017 | [1] | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2016 | [1] | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Contribution Margin | |||||||||||||
Total Contribution Margin | $ 2,324.9 | $ 2,361.2 | $ 2,361.6 | ||||||||||
Selling, general and administrative expense | 1,758.6 | 1,966.9 | 1,784.5 | ||||||||||
Other operating income | (50.8) | (63.8) | (6.5) | ||||||||||
Interest expense | 160.8 | 99.3 | 100.5 | ||||||||||
Interest income | 14.5 | 5.9 | 5.6 | ||||||||||
Other expense, net | (0.4) | 2.3 | |||||||||||
Income before income taxes | 471.2 | 364.7 | 486.4 | ||||||||||
Income taxes | 257.3 | 104.7 | 147.3 | ||||||||||
NET INCOME | $ (63.4) | $ 54.5 | $ 137.6 | $ 85.2 | $ 99.4 | $ 87.7 | $ (22.9) | $ 95.8 | 213.9 | 260 | 339.1 | ||
Primary Reporting Segment [Member] | |||||||||||||
Contribution Margin | |||||||||||||
Total Contribution Margin | 1,534.2 | 1,571.9 | 1,598.8 | ||||||||||
China [Member] | |||||||||||||
Contribution Margin | |||||||||||||
Total Contribution Margin | 790.7 | 789.3 | 762.8 | ||||||||||
Other operating income | $ (50.8) | $ (34.2) | $ (6.5) | ||||||||||
[1] | Includes the impact of the U.S. Tax Reform enacted during the fourth quarter of 2017, as described further in Note 12, Income Taxes. |
Segment Information - Schedule
Segment Information - Schedule of Entity-Wide Information, Revenue from External Customers by Products and Services (Detail) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | |||||||||||
Dec. 31, 2017 | [1] | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2016 | [1] | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Revenue from External Customer [Line Items] | |||||||||||||
Total Net Sales | $ 1,093.3 | $ 1,085.4 | $ 1,146.9 | $ 1,102.1 | $ 1,045 | $ 1,122 | $ 1,201.8 | $ 1,119.6 | $ 4,427.7 | $ 4,488.4 | $ 4,469 | ||
Weight Management [Member] | |||||||||||||
Revenue from External Customer [Line Items] | |||||||||||||
Total Net Sales | 2,842.5 | 2,864.5 | 2,862.8 | ||||||||||
Targeted Nutrition [Member] | |||||||||||||
Revenue from External Customer [Line Items] | |||||||||||||
Total Net Sales | 1,082.8 | 1,062.8 | 1,015.4 | ||||||||||
Energy, Sports & Fitness [Member] | |||||||||||||
Revenue from External Customer [Line Items] | |||||||||||||
Total Net Sales | 263.8 | 268.4 | 250.9 | ||||||||||
Outer Nutrition [Member] | |||||||||||||
Revenue from External Customer [Line Items] | |||||||||||||
Total Net Sales | 93.9 | 110.4 | 133 | ||||||||||
Literature, Promotional and Other [Member] | |||||||||||||
Revenue from External Customer [Line Items] | |||||||||||||
Total Net Sales | $ 144.7 | $ 182.3 | $ 206.9 | ||||||||||
[1] | Includes the impact of the U.S. Tax Reform enacted during the fourth quarter of 2017, as described further in Note 12, Income Taxes. |
Segment Information - Schedul61
Segment Information - Schedule of Revenue from External Customers Attributed to Foreign Countries by Geographic Area (Detail) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | |||||||||||
Dec. 31, 2017 | [1] | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2016 | [1] | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||||||||||
Total Net Sales | $ 1,093.3 | $ 1,085.4 | $ 1,146.9 | $ 1,102.1 | $ 1,045 | $ 1,122 | $ 1,201.8 | $ 1,119.6 | $ 4,427.7 | $ 4,488.4 | $ 4,469 | ||
United States [Member] | |||||||||||||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||||||||||
Total Net Sales | 818.3 | 935 | 860 | ||||||||||
Mexico [Member] | |||||||||||||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||||||||||
Total Net Sales | 442.7 | 446.6 | 479.9 | ||||||||||
China [Member] | |||||||||||||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||||||||||
Total Net Sales | 885.9 | 868.8 | 846.2 | ||||||||||
Others [Member] | |||||||||||||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||||||||||
Total Net Sales | $ 2,280.8 | $ 2,238 | $ 2,282.9 | ||||||||||
[1] | Includes the impact of the U.S. Tax Reform enacted during the fourth quarter of 2017, as described further in Note 12, Income Taxes. |
Segment Information - Reconci62
Segment Information - Reconciliation of Operating Profit (Loss) from Segments to Consolidated (Parenthetical) (Detail) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Selling, General and Administrative Expenses [Member] | China [Member] | |||
Segment Reporting Reconciling Item For Operating Profit Loss From Segment To Consolidated [Line Items] | |||
Independent service providers service fees costs | $ 419.5 | $ 407.1 | $ 403.5 |
Segment Information - Schedul63
Segment Information - Schedule of Property, Plant and Equipment and Deferred Tax Assets by Geographic Area (Detail) - USD ($) $ in Millions | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 |
Schedule of Property Plant and Equipment and Deferred Tax Assets [Line Items] | |||
Total Property, Plant and Equipment, net | $ 377.5 | $ 378 | $ 339.2 |
Total Deferred Tax Assets | 174.5 | 281.2 | 252.4 |
United States [Member] | |||
Schedule of Property Plant and Equipment and Deferred Tax Assets [Line Items] | |||
Total Property, Plant and Equipment, net | 289.8 | 290.7 | 264.2 |
Total Deferred Tax Assets | 103.6 | 218.7 | 188.5 |
Foreign [Member] | |||
Schedule of Property Plant and Equipment and Deferred Tax Assets [Line Items] | |||
Total Property, Plant and Equipment, net | 87.7 | 87.3 | 75 |
Total Deferred Tax Assets | $ 70.9 | $ 62.5 | $ 63.9 |
Derivative Instruments and He64
Derivative Instruments and Hedging Activities - Additional Information (Detail) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Derivative Instruments, Gain (Loss) [Line Items] | ||
Derivative asset fair value | $ 5.8 | $ 7.4 |
Derivative liability fair value | 6.6 | 3.5 |
Cash flow hedges reclassified into earnings over next twelve months | 0.3 | |
Foreign exchange currency contracts [Member] | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Derivative asset fair value | 5.8 | 7.4 |
Derivative liability fair value | 6.6 | 3.5 |
Foreign exchange currency contracts [Member] | Derivatives designated as cash flow hedging instruments [Member] | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Derivative aggregate notional amounts | 104.9 | 90 |
Derivative asset fair value | 2.9 | 4.6 |
Derivative liability fair value | 4 | |
Foreign exchange forward contracts [Member] | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Derivative aggregate notional amounts | $ 435.4 | $ 447.2 |
Freestanding derivatives [Member] | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Derivative average remaining maturity period | 1 month | 1 month |
Maximum [Member] | Foreign exchange currency contracts [Member] | Derivatives designated as cash flow hedging instruments [Member] | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Derivative maximum remaining maturity period | 15 months | |
Maximum [Member] | Foreign exchange forward contracts [Member] | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Derivative maximum remaining maturity period | 12 months | 12 months |
Derivative Instruments and He65
Derivative Instruments and Hedging Activities - Summary of Foreign Currency Forward Contracts Outstanding (Detail) $ in Millions | Dec. 31, 2017USD ($) | Dec. 31, 2016USD ($) |
Buy Argentine peso sell Euro [Member] | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Average Contract Rate | 21.40 | |
Original Notional Amount | $ 0.5 | |
Buy Chinese yuan sell Euro [Member] | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Average Contract Rate | 8.03 | 7.51 |
Original Notional Amount | $ 25.9 | $ 61.8 |
Fair Value Gain (Loss) | $ 0.4 | $ 1 |
Buy Australian dollar sell Euro | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Average Contract Rate | 1.55 | |
Original Notional Amount | $ 0.9 | |
Buy Canadian dollar sell Euro [Member] | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Average Contract Rate | 1.52 | |
Original Notional Amount | $ 0.5 | |
Buy Chilean peso sell Euro [Member] | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Average Contract Rate | 749.55 | |
Original Notional Amount | $ 0.6 | |
Buy Euro sell Australian dollar [Member] | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Average Contract Rate | 1.56 | 1.46 |
Original Notional Amount | $ 4.8 | $ 1.7 |
Fair Value Gain (Loss) | $ (0.1) | |
Buy Euro sell Chilean peso [Member] | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Average Contract Rate | 749.35 | 723.80 |
Original Notional Amount | $ 1.1 | $ 1 |
Buy Euro sell Hong Kong dollar [Member] | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Average Contract Rate | 9.26 | 8.11 |
Original Notional Amount | $ 6.8 | $ 13.4 |
Fair Value Gain (Loss) | $ 0.1 | $ 0.1 |
Buy Euro sell Chinese yuan [Member] | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Average Contract Rate | 7.84 | |
Original Notional Amount | $ 26.5 | |
Fair Value Gain (Loss) | $ 0.2 | |
Buy Euro sell Argentine peso [Member] | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Average Contract Rate | 21.46 | |
Original Notional Amount | $ 0.5 | |
Buy Euro sell Japanese yen [Member] | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Average Contract Rate | 133.88 | 122.54 |
Original Notional Amount | $ 0.4 | $ 0.6 |
Buy Euro sell Indonesian rupiah [Member] | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Average Contract Rate | 16,113.59 | 14,394.40 |
Original Notional Amount | $ 11.5 | $ 9.4 |
Fair Value Gain (Loss) | $ 0.1 | $ (0.1) |
Buy Euro sell Mexican peso [Member] | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Average Contract Rate | 22.65 | 22.01 |
Original Notional Amount | $ 59.1 | $ 52.2 |
Fair Value Gain (Loss) | $ 3.6 | $ 1.2 |
Buy Euro sell Canadian dollar [Member] | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Average Contract Rate | 1.52 | |
Original Notional Amount | $ 0.5 | |
Buy Euro sell Peruvian nuevo sol [Member] | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Average Contract Rate | 3.85 | 3.61 |
Original Notional Amount | $ 4.9 | $ 3.9 |
Fair Value Gain (Loss) | $ (0.1) | |
Buy Euro sell Philippine peso [Member] | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Average Contract Rate | 60.03 | 53.11 |
Original Notional Amount | $ 5.3 | $ 5.4 |
Fair Value Gain (Loss) | $ (0.1) | |
Buy Euro sell Russian ruble [Member] | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Average Contract Rate | 70.38 | 68.37 |
Original Notional Amount | $ 10.8 | $ 5.6 |
Fair Value Gain (Loss) | $ (0.1) | $ (0.3) |
Buy Euro sell Ghana cedi [Member] | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Average Contract Rate | 5.61 | |
Original Notional Amount | $ 3 | |
Fair Value Gain (Loss) | $ (0.1) | |
Buy Euro sell U.S. dollar [Member] | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Average Contract Rate | 1.18 | 1.08 |
Original Notional Amount | $ 59.1 | $ 74.5 |
Fair Value Gain (Loss) | $ 0.9 | $ (1.5) |
Buy Euro sell South African rand [Member] | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Average Contract Rate | 16.37 | 15.02 |
Original Notional Amount | $ 3.8 | $ 3.4 |
Fair Value Gain (Loss) | $ (0.3) | $ (0.1) |
Buy British pound sell Euro [Member] | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Average Contract Rate | 0.88 | 0.84 |
Original Notional Amount | $ 3.4 | $ 3.1 |
Fair Value Gain (Loss) | $ (0.1) | |
Buy Hong Kong dollar sell Euro [Member] | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Average Contract Rate | 9.31 | 8.11 |
Original Notional Amount | $ 3 | $ 11.9 |
Fair Value Gain (Loss) | $ (0.1) | |
Buy Kazakhstani tenge sell U.S. dollar [Member] | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Average Contract Rate | 338.75 | 342 |
Original Notional Amount | $ 0.9 | $ 0.9 |
Buy Indonesian rupiah sell Euro [Member] | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Average Contract Rate | 16,164.33 | 14,222.02 |
Original Notional Amount | $ 4.8 | $ 3.9 |
Buy Russian ruble sell Euro [Member] | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Average Contract Rate | 70.47 | 67.50 |
Original Notional Amount | $ 4.4 | $ 3.2 |
Fair Value Gain (Loss) | $ 0.1 | $ 0.1 |
Buy Euro sell Kazakhstani tenge [Member] | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Average Contract Rate | 401.40 | |
Original Notional Amount | $ 1.7 | |
Buy Korean won sell U.S. dollar [Member] | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Average Contract Rate | 1,077.18 | 1,167.30 |
Original Notional Amount | $ 5.4 | $ 5 |
Fair Value Gain (Loss) | $ 0.1 | $ (0.2) |
Buy Mexican peso sell Euro [Member] | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Average Contract Rate | 22.97 | 21.30 |
Original Notional Amount | $ 7.1 | $ 11.9 |
Fair Value Gain (Loss) | $ (0.2) | $ (0.3) |
Buy Norwegian krone sell U.S. dollar [Member] | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Average Contract Rate | 8.26 | 8.70 |
Original Notional Amount | $ 1.2 | $ 1.1 |
Buy Swedish krona sell U.S. dollar [Member] | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Average Contract Rate | 8.37 | 9.17 |
Original Notional Amount | $ 1.9 | $ 0.8 |
Fair Value Gain (Loss) | $ 0.1 | |
Buy Euro sell Malaysian ringgit [Member] | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Average Contract Rate | 4.84 | |
Original Notional Amount | $ 1.6 | |
Buy Taiwan dollar sell U.S. dollar [Member] | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Average Contract Rate | 29.78 | 32.08 |
Original Notional Amount | $ 5.9 | $ 17.1 |
Fair Value Gain (Loss) | $ 0.1 | $ (0.1) |
Buy Peruvian nuevo sol sell Euro [Member] | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Average Contract Rate | 3.85 | 3.57 |
Original Notional Amount | $ 2.3 | $ 1 |
Buy U.S. dollar sell Colombian peso [Member] | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Average Contract Rate | 2,996 | 3,092.61 |
Original Notional Amount | $ 1 | $ 5.6 |
Fair Value Gain (Loss) | $ (0.1) | |
Buy U.S. dollar sell Euro [Member] | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Average Contract Rate | 1.15 | 1.06 |
Original Notional Amount | $ 141.1 | $ 140.4 |
Fair Value Gain (Loss) | $ (5.3) | 4.5 |
Buy Euro sell Thai baht [Member] | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Average Contract Rate | 38.33 | |
Original Notional Amount | $ 1.3 | |
Buy Euro sell Taiwan dollar [Member] | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Average Contract Rate | 35.59 | |
Original Notional Amount | $ 0.6 | |
Foreign exchange forward contracts [Member] | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Original Notional Amount | 435.4 | 447.2 |
Fair Value Gain (Loss) | $ (0.8) | $ 3.9 |
Buy British pound sell U.S. dollar [Member] | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Average Contract Rate | 1.35 | |
Original Notional Amount | $ 2.8 | |
Buy U.S. dollar sell South African rand [Member] | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Average Contract Rate | 13.93 | 14.14 |
Original Notional Amount | $ 1.9 | $ 2.1 |
Fair Value Gain (Loss) | $ (0.2) | $ (0.1) |
Buy South African rand sell Euro [Member] | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Average Contract Rate | 15.18 | 14.75 |
Original Notional Amount | $ 0.9 | $ 0.4 |
Buy Indonesian rupiah sell U.S. dollar [Member] | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Average Contract Rate | 13,676 | |
Original Notional Amount | $ 6.2 | |
Buy Malaysian ringgit sell Euro [Member] | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Average Contract Rate | 4.90 | |
Original Notional Amount | $ 0.5 | |
Buy Thai baht sell Euro [Member] | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Average Contract Rate | 38.69 | |
Original Notional Amount | $ 2.2 | |
Buy U.S. dollar sell British pound [Member] | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Average Contract Rate | 1.34 | |
Original Notional Amount | $ 6.8 | |
Fair Value Gain (Loss) | $ (0.1) | |
Buy Colombian peso sell U.S. dollar [Member] | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Average Contract Rate | 3,111.41 | |
Original Notional Amount | $ 2.6 | |
Fair Value Gain (Loss) | $ 0.1 | |
Buy Philippine peso sell Euro [Member] | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Average Contract Rate | 52.42 | |
Original Notional Amount | $ 1.7 | |
Buy Usd Sell Jpy | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Average Contract Rate | 117.39 | |
Original Notional Amount | $ 0.5 | |
Buy Zar Sell Usd | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Average Contract Rate | 14.24 | |
Original Notional Amount | $ 1.1 |
Derivative Instruments and He66
Derivative Instruments and Hedging Activities - Gains (Losses) Relating to Derivative Instruments Recorded in Other Comprehensive Loss (Detail) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Foreign exchange currency contracts relating to inventory and intercompany management fee hedges [Member] | Derivatives designated as hedging instruments [Member] | |||
Derivative Instruments, Gain (Loss) [Line Items] | |||
Amount of Gain (Loss) Recognized in Other Comprehensive Loss | $ (7.9) | $ 8.1 | $ 14.8 |
Derivative Instruments and He67
Derivative Instruments and Hedging Activities - Gains (Losses) Relating to Derivative Instruments Recorded to Income (Detail) - Selling, general and administrative expenses [Member] - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Foreign exchange currency contracts relating to inventory and intercompany management fee hedges [Member] | Derivatives designated as hedging instruments [Member] | |||
Derivative Instruments, Gain (Loss) [Line Items] | |||
Amount of Gain (Loss) Recognized in Income | $ (0.1) | $ 0.2 | $ 0.4 |
Foreign exchange currency contracts [Member] | Derivatives not designated as hedging instruments [Member] | |||
Derivative Instruments, Gain (Loss) [Line Items] | |||
Amount of Gain (Loss) Recognized in Income | $ (8.6) | $ (4.3) | $ (4.1) |
Derivative Instruments and He68
Derivative Instruments and Hedging Activities - Gains (Losses) Relating to Derivative Instruments Recorded to Income (Parenthetical) (Detail) - Derivatives designated as hedging instruments [Member] $ in Millions | 12 Months Ended |
Dec. 31, 2015USD ($) | |
Derivative Instruments, Gain (Loss) [Line Items] | |
Benefit related to hedge ineffectiveness | $ 1.3 |
Expense related to amounts excluded from assessment of hedge effectiveness recognized in income (loss) | $ 0.9 |
Derivative Instruments and He69
Derivative Instruments and Hedging Activities - Gains (Losses) Relating to Derivative Instruments Reclassified from Accumulated Other Comprehensive Loss into Income Effective Portion (Detail) - Foreign exchange currency contracts relating to inventory and intercompany management fee hedges [Member] - Derivatives designated as hedging instruments [Member] - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Cost of sales [Member] | |||
Derivative Instruments, Gain (Loss) [Line Items] | |||
Amount of Gain (Loss) Reclassified from Accumulated Other Comprehensive Loss into Income | $ (0.5) | $ 14.7 | $ 15.8 |
Selling, general and administrative expenses [Member] | |||
Derivative Instruments, Gain (Loss) [Line Items] | |||
Amount of Gain (Loss) Reclassified from Accumulated Other Comprehensive Loss into Income | $ (2.2) | $ 0.3 | $ 0.2 |
Income Taxes - Components of In
Income Taxes - Components of Income before Income Taxes (Detail) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Income Tax Disclosure [Abstract] | |||
Domestic | $ (29) | $ (89.3) | $ 80.9 |
Foreign | 500.2 | 454 | 405.5 |
Income before income taxes | $ 471.2 | $ 364.7 | $ 486.4 |
Income Taxes - Components of 71
Income Taxes - Components of Income Tax Expense (Detail) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Current: | |||
Foreign | $ 147.1 | $ 127.9 | $ 147 |
Federal | 10.6 | 12.4 | 35.4 |
State | 1.8 | 0.8 | 3.1 |
Current Income Tax Expense (Benefit), Total | 159.5 | 141.1 | 185.5 |
Deferred: | |||
Foreign | (8.6) | 12.5 | (13.2) |
Federal | 106.4 | (47.2) | (23.8) |
State | (1.7) | (1.2) | |
Deferred Income Tax Expense (Benefit), Total | 97.8 | (36.4) | (38.2) |
Total | $ 257.3 | $ 104.7 | $ 147.3 |
Income Taxes - Deferred Tax Ass
Income Taxes - Deferred Tax Assets and Liabilities (Detail) - USD ($) $ in Millions | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 |
Deferred income tax assets: | |||
Accruals not currently deductible | $ 78.5 | $ 85.2 | |
Tax loss and credit carryforwards of certain foreign subsidiaries | 137.6 | 115.1 | |
Tax loss and domestic tax credit carryforwards | 191.4 | 102.6 | |
Deferred compensation plan | 49.7 | 73.8 | |
Accrued vacation | 4.4 | 6.2 | |
Inventory reserve | 7.4 | 11.2 | |
Other | 4.9 | 2.5 | |
Gross deferred income tax assets | 473.9 | 396.6 | |
Less: valuation allowance | (299.4) | (115.4) | |
Total deferred income tax assets | 174.5 | 281.2 | $ 252.4 |
Deferred income tax liabilities: | |||
Intangible assets | 71.1 | 112.2 | |
Depreciation/amortization | 5.4 | 15.9 | |
Unremitted foreign earnings | 20.5 | 5.5 | |
Other | 7.7 | 7.7 | |
Total deferred income tax liabilities | 104.7 | 141.3 | |
Total net deferred tax assets | $ 69.8 | $ 139.9 |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Detail) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | |||
Dec. 31, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Income Taxes [Line Items] | |||||
Tax loss and credit carryforwards of certain foreign subsidiaries | $ 137.6 | $ 137.6 | $ 115.1 | ||
Amount of tax loss and credit carryforwards that will expire between 2018 and 2027 | 70.7 | 70.7 | |||
Amount of tax loss and credit carryforwards that can be carried forward indefinitely | 66.9 | 66.9 | |||
U.S. foreign tax credit carryforwards | 186.2 | 186.2 | 99.6 | ||
State tax loss carryforwards | 0.4 | $ 0.4 | |||
Effective tax rate applied | 35.00% | ||||
Net expense | 153.3 | ||||
Valuation allowance | 163.4 | ||||
Remeasurement of net deferred tax liabilities in corporate income tax rate | 5.5 | ||||
Domestic foreign tax credit carryforwards | 4.6 | ||||
Percentage of domestic source income reclassified as foreign source income | 50.00% | ||||
Deferred tax assets tax credit carryforwards foreign resulting from overall domestic loss | 31.4 | $ 31.4 | |||
Valuation allowance | 299.4 | 299.4 | 115.4 | ||
Valuation allowance, deferred tax asset, change in amount | 184 | (5.9) | $ (208.7) | ||
Additions (Reductions) charged to income tax expenses | 183.7 | (5.6) | (205.6) | ||
Other comprehensive income (loss), foreign currency translation gain (loss) arising during period, tax | (0.3) | 0.3 | 3.1 | ||
Unremitted earnings that were permanently reinvested relating to operating subsidiaries | 2,400 | 2,400 | |||
Deferred tax liability on unremitted foreign earnings | 29.1 | 29.1 | 5.5 | ||
Total amount of unrecognized tax benefits, including related interest and penalties | 62 | 62 | 62 | 58 | |
Unrecognized tax benefits excluding interest and penalties that if recognized would affect the effective tax rate | 44.4 | 44.4 | 44.8 | ||
Total accrued interest for tax contingencies | 9.9 | 9.9 | 9.4 | 7.1 | |
Total accrued penalties for tax contingencies | 1.5 | 1.5 | 2.1 | 1.5 | |
Increase (decrease) in interest expense related to uncertain tax positions | (0.1) | 2.7 | 2 | ||
Increase (decrease) in penalties to uncertain tax positions | (0.8) | $ 0.7 | $ 0.6 | ||
Amount of unrecognized tax benefits that could decrease within the next 12 months | 7 | 7 | |||
Decrease in unrecognized tax benefits due to the settlement of audits or resolution of administrative or judicial proceedings | 0.7 | 0.7 | |||
Decrease in unrecognized tax benefits expiration of statute of limitations | 6.3 | $ 6.3 | |||
Scenario, Forecast [Member] | |||||
Income Taxes [Line Items] | |||||
Effective tax rate applied | 21.00% | ||||
Carryforwards expiring in 2024 [Member] | |||||
Income Taxes [Line Items] | |||||
Expiration year of tax credit carryforwards | Dec. 31, 2020 | ||||
Earliest Tax Year [Member] | |||||
Income Taxes [Line Items] | |||||
Open tax years by major tax jurisdiction | 2,012 | ||||
Domestic [Member] | |||||
Income Taxes [Line Items] | |||||
Domestic research and development tax credit carryforward | 4.8 | $ 4.8 | |||
Domestic [Member] | Research and Development [Member] | |||||
Income Taxes [Line Items] | |||||
Expiration year of tax credit carryforwards | 2,037 | ||||
State [Member] | Earliest Tax Year [Member] | |||||
Income Taxes [Line Items] | |||||
Expiration year of tax loss carryforwards | 2,022 | ||||
State [Member] | Latest Tax Year [Member] | |||||
Income Taxes [Line Items] | |||||
Expiration year of tax loss carryforwards | 2,037 | ||||
United States [Member] | |||||
Income Taxes [Line Items] | |||||
Unremitted earnings that were permanently reinvested | $ 97.9 | $ 97.9 |
Income Taxes - Reconciliation b
Income Taxes - Reconciliation between Provision for Income Taxes at Statutory Rate and Provision for Income Taxes at Effective Tax Rate (Detail) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Income Tax Disclosure [Abstract] | |||
Tax expense at United States statutory rate | $ 164.9 | $ 127.7 | $ 170.2 |
Increase (decrease) in tax resulting from: | |||
Differences between U.S. and foreign tax rates on foreign income, including withholding taxes | (42.7) | (16.6) | 203.1 |
U.S. tax (benefit) on foreign income net of foreign tax credits | (22.9) | (10.2) | (23.9) |
(Decrease) increase in valuation allowances | 183.7 | (5.6) | (205.6) |
State taxes, net of federal benefit | 1.9 | 0.3 | 1.7 |
Unrecognized tax benefits | (4) | 5.3 | 10.1 |
Excess tax benefits on equity awards | (31.1) | ||
Other | 7.5 | 3.8 | (8.3) |
Total | $ 257.3 | $ 104.7 | $ 147.3 |
Income Taxes - Changes Occurred
Income Taxes - Changes Occurred in Amount of Unrecognized Tax Benefits (Detail) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Income Tax Disclosure [Abstract] | |||
Beginning balance of unrecognized tax benefits | $ 50.5 | $ 49.4 | $ 40.5 |
Additions for current year tax positions | 13 | 9.3 | 11.3 |
Additions for prior year tax positions | 3.6 | 2 | 2.5 |
Reductions for prior year tax positions | (6) | (4.7) | (0.6) |
Reductions for audit settlements | (7.1) | (0.1) | |
Reductions for the expiration of statutes of limitation | (6.2) | (4.2) | (2.8) |
Changes due to foreign currency translation adjustments | 2.8 | (1.3) | (1.4) |
Ending balance of unrecognized tax benefits (excluding interest and penalties) | 50.6 | 50.5 | 49.4 |
Interest and penalties associated with unrecognized tax benefits | 11.4 | 11.5 | 8.6 |
Ending balance of unrecognized tax benefits (including interest and penalties) | $ 62 | $ 62 | $ 58 |
Fair Value Measurements - Deriv
Fair Value Measurements - Derivative Assets and Liabilities Measured at Fair Value (Detail) - USD ($) $ in Millions | Dec. 31, 2017 | Dec. 31, 2016 |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Fair value derivative assets | $ 5.8 | $ 7.4 |
Fair value derivative liabilities | 6.6 | 3.5 |
Foreign exchange currency contracts [Member] | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Fair value derivative assets | 5.8 | 7.4 |
Fair value derivative liabilities | 6.6 | 3.5 |
Significant Other Observable Inputs (Level 2) [Member] | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Fair value measurements, assets total | 5.8 | 7.4 |
Fair value measurements, liabilities total | 6.6 | 3.5 |
Significant Other Observable Inputs (Level 2) [Member] | Derivatives designated as hedging instruments [Member] | Foreign exchange currency contracts relating to inventory and intercompany management fee hedges [Member] | Prepaid expenses and other current assets [Member] | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Fair value derivative assets | 2.9 | 4.6 |
Significant Other Observable Inputs (Level 2) [Member] | Derivatives designated as hedging instruments [Member] | Foreign exchange currency contracts relating to inventory and intercompany management fee hedges [Member] | Other current liabilities [Member] | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Fair value derivative liabilities | 4 | |
Significant Other Observable Inputs (Level 2) [Member] | Derivatives not designated as hedging instruments [Member] | Foreign exchange currency contracts [Member] | Prepaid expenses and other current assets [Member] | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Fair value derivative assets | 2.9 | 2.8 |
Significant Other Observable Inputs (Level 2) [Member] | Derivatives not designated as hedging instruments [Member] | Foreign exchange currency contracts [Member] | Other current liabilities [Member] | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Fair value derivative liabilities | $ 2.6 | $ 3.5 |
Fair Value Measurements - Offse
Fair Value Measurements - Offsetting of Derivative Assets (Detail) - USD ($) $ in Millions | Dec. 31, 2017 | Dec. 31, 2016 |
Derivative [Line Items] | ||
Gross Amounts of Recognized Assets | $ 5.8 | $ 7.4 |
Gross Amounts Offset in the Balance Sheet, Derivative Assets | (4.3) | (3) |
Net Amounts of Assets Presented in the Balance Sheet | 1.5 | 4.4 |
Foreign exchange currency contracts [Member] | ||
Derivative [Line Items] | ||
Gross Amounts of Recognized Assets | 5.8 | 7.4 |
Gross Amounts Offset in the Balance Sheet, Derivative Assets | (4.3) | (3) |
Net Amounts of Assets Presented in the Balance Sheet | $ 1.5 | $ 4.4 |
Fair Value Measurements - Off78
Fair Value Measurements - Offsetting of Derivative Liabilities (Detail) - USD ($) $ in Millions | Dec. 31, 2017 | Dec. 31, 2016 |
Derivative [Line Items] | ||
Gross Amounts of Recognized Liabilities | $ 6.6 | $ 3.5 |
Gross Amounts Offset in the Balance Sheet, Derivative Liabilities | (4.3) | (3) |
Net Amounts of Liabilities Presented in the Balance Sheet | 2.3 | 0.5 |
Foreign exchange currency contracts [Member] | ||
Derivative [Line Items] | ||
Gross Amounts of Recognized Liabilities | 6.6 | 3.5 |
Gross Amounts Offset in the Balance Sheet, Derivative Liabilities | (4.3) | (3) |
Net Amounts of Liabilities Presented in the Balance Sheet | $ 2.3 | $ 0.5 |
Detail of Certain Balance She79
Detail of Certain Balance Sheet Accounts - Additional Information (Detail) - USD ($) $ in Millions | Dec. 31, 2017 | Dec. 31, 2016 |
Balance Sheet Related Disclosures [Abstract] | ||
Deferred compensation plan assets | $ 33.6 | $ 30.6 |
Deferred tax assets | 77.5 | 155.2 |
Deferred compensation plan liabilities | 58.1 | 50 |
Deferred income tax liabilities | $ 7.8 | $ 15.3 |
Detail of Certain Balance She80
Detail of Certain Balance Sheet Accounts - Schedule of Other Current Liabilities (Detail) - USD ($) $ in Millions | Dec. 31, 2017 | Dec. 31, 2016 |
Other Liabilities Current [Abstract] | ||
Accrued compensation | $ 117.3 | $ 125.8 |
Accrued service fees to China independent service providers | 58.7 | 46.3 |
Accrued advertising, events, and promotion expenses | 46.3 | 48.4 |
Advance sales deposits | 65.2 | 50.1 |
Income taxes payable | 25.7 | 42 |
Other accrued liabilities | 145.7 | 142.2 |
Total | $ 458.9 | $ 454.8 |
Subsequent Events - Additional
Subsequent Events - Additional Information (Detail) - USD ($) $ in Millions | 1 Months Ended | ||
Jan. 31, 2018 | Dec. 31, 2017 | Feb. 21, 2017 | |
Subsequent Event [Line Items] | |||
Share repurchase program authorized amount | $ 1,500 | $ 1,500 | $ 1,500 |
Subsequent Event [Member] | Open market purchases [Member] | |||
Subsequent Event [Line Items] | |||
Repurchase of common stock, shares | 4,200 | ||
Repurchase of common stock, value | $ 0.3 |
Quarterly Information (Unaudi82
Quarterly Information (Unaudited) - Quarterly Net Income, Basic Earnings Per Share and Diluted Earnings Per Share (Detail) - USD ($) $ / shares in Units, $ in Millions | 3 Months Ended | 12 Months Ended | |||||||||||
Dec. 31, 2017 | [1] | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2016 | [1] | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Quarterly Financial Information Disclosure [Abstract] | |||||||||||||
Net sales | $ 1,093.3 | $ 1,085.4 | $ 1,146.9 | $ 1,102.1 | $ 1,045 | $ 1,122 | $ 1,201.8 | $ 1,119.6 | $ 4,427.7 | $ 4,488.4 | $ 4,469 | ||
Gross profit | 883.5 | 870 | 928.1 | 897.5 | 848.9 | 912.9 | 965.5 | 906.5 | 3,579.1 | 3,633.8 | 3,613 | ||
Net income (loss) | $ (63.4) | $ 54.5 | $ 137.6 | $ 85.2 | $ 99.4 | $ 87.7 | $ (22.9) | $ 95.8 | $ 213.9 | $ 260 | $ 339.1 | ||
Earnings (loss) per share | |||||||||||||
Basic | $ (0.87) | $ 0.69 | $ 1.69 | $ 1.03 | $ 1.19 | $ 1.06 | $ (0.28) | $ 1.16 | $ 2.70 | $ 3.13 | $ 4.11 | ||
Diluted | $ (0.87) | $ 0.66 | $ 1.61 | $ 0.98 | $ 1.16 | $ 1.01 | $ (0.28) | $ 1.12 | $ 2.58 | $ 3.02 | $ 3.97 | ||
[1] | Includes the impact of the U.S. Tax Reform enacted during the fourth quarter of 2017, as described further in Note 12, Income Taxes. |