The company also reported net income of $82.1 million or $1.08 per diluted share for the first quarter of 2018, which was an improvement over the $0.98 the company earned per share in the first quarter of 2017.
The stock market has reacted enthusiastically to the company’s recent results. Herbalife’s shares are now trading at an all-time high of more than $111 a share, having broken through the $100 ceiling in mid April.
It’s a remarkable turnaround for the network marketing giant. Herbalife’s shares traded at a low of less than $31 in early 2015, following a high profile campaign by short seller Bill Ackman. Ackman’s investment firm Pershing Square Capital reportedly has restructured is position in Herbalife to cap its expected losses on the investment.
Herbalife also had to pay $200 million to settle a case brought by the US Federal Trade Commission. In the agreement, Herbalife committed to restructuring its compensation plan to put to rest lingering allegations of illegal pyramid scheme activity.
Returning to rapid new product development
Those changes depressed earnings for a number of quarters. But CEO Rich Goudis said Herbalife’s distributor network has now fully adapted and the company can now get back to doing what it does best: Launching new products to match market needs.
“We're more on the offense today than ever before. Our distributor leaders see the opportunity for us to get into new product categories,” Goudis said during an earnings call with analysts.
In the call, which was posted in transcript form on the site seekingalpha.com, Goudis noted launches of 65 new products or line extensions globally. That included new flavors of the company’s signature Formula 1 nutritional shake in China and in India.
The new flavor in China, a red bean and koi seed flavor, was developed with the input of local distributors, Goudis said.
“This product had tremendous sales performance, selling out in only two months, further validating the success of this strategy and our ability to develop and manufacture local flavors of our top-selling products,” he said.
Goudis said the company’s extensive network of local distributors gives it a built-in mechanism to gather market intelligence.
“We anticipate that you'll see significant activity in the area of new products over the next 12 to 18 months, products that will expand our offering into new day part segments along with products in new categories that will enable our distributors to attract new customers and extend the life cycle of their existing customers,” he said.