Herbalife cuts sales outlook, shares slide 10.5 percent
(Reuters) - Herbalife Ltd, a maker of weight-loss and nutritional products, cut its sales outlook for the year after raising it three months earlier, sending its shares down 10.5 percent in extended trading.
The company, which has been labeled a pyramid scheme by hedge fund manager Bill Ackman, also reported lower-than-expected quarterly profit as costs jumped.
The company forecast 2014 revenue growth of 8.5 to 10.5 percent, down from a previous forecast 10 to 12 percent growth.
The company raised its adjusted profit forecast, the third time in a row, to $6.17-$6.32 a share from $6.10-$6.30 a share, after it repurchased 9.8 million shares in the second quarter.
Ackman made a presentation last week portraying Herbalife as a criminal enterprise but the company's shares soared 26 percent as he failed to convince investors.
The billionaire investor took a $1 billion short position against the company in December 2012.
The company has repeatedly denied Ackman's allegations, and high-profile investors such as Carl Icahn, George Soros and Daniel Loeb have supported it by taking stakes.
Icahn had a 17.3 percent stake in the company as of March 31, while Soros had 5 percent.
Herbalife's net income fell to $119.5 million, or $1.31 per share, in the second-quarter ended June 30, from $143.2 million, or $1.34 per share, a year earlier. Continued...