Herbalife Ltd. (NYSE:HLF) shares are falling in pre-market on Monday despite the company lifting its profit outlook for the second quarter. The upwardly revised earnings forecast’s mid-point failed to meet the analysts’ estimates.
Herbalife, which is a maker of nutritional supplement, boosted its adjusted earnings forecast to $0.95 – $1.15 a share from $0.85 – $1.08 for the second quarter. The mid-point of earnings outlook fell shy of the Street analysts’ estimate of $1.11 a share for the same period.
There was also another blow for investors as the company is expected its sales to drop 6 – 2 percent in the second quarter whereas Analysts are looking for a fall of 1.9 percent. The revised sales forecast is wider than the earlier projection of a drop of 4.5 – 0.5 percent in the three-month period.
Herbalife blamed it on the transition to the fresh FTC rules in the United States. Aside from that, the company also pointed out the soft demand in its Mexican unit. The nutritional supplement maker revealed that the 90 percent of its sales came from the United States in May that exceeded the threshold limit of 80 percent as part of a deal with FTC.
The company’s CEO, Richard Goudis, has reportedly commented, “These figures should put an end to any questions regarding demand for our nutrition products and the strength of our go-to-market business model.”
At last check, Herbalife shares are trading down 4.15 percent in pre-market on Monday.