Herbalife Nutrition Ltd. (NYSE:HLF) Q1 2023 Earnings Call Transcript

But the overall strength is going to be one that is going to have to take place across a lot of states and across a lot of regions in a very short period of time. And so I wouldn’t predict that that’s going to happen quickly. I think it’s going to happen systematically. It takes 12 months for a new distributor to open up a Nutrition Club. So we have a lag there. It takes a little time for them to understand how to operate these clubs most effectively. Our social media selling is on the uptick, but it needs to be refurbished. And we are building — we have a San Antonio, Extravaganza coming up. We’ll launch an extremely positive new line there of products that we think will enhance and help Nutrition Club operators, build out their customers even stronger, but this takes time.

So, I don’t want to use the word lag, because I’ve never liked that word much, but it’s a reality right now that once we get these in place, it takes a little time for them to have effect. The energy and excitement among our distributors super high. And how that translates into numbers will take a little time.

Jeff Van Sinderen : Okay. That’s fair. And then if I could, just wanted to get a sense, I guess, of what trends you’re seeing even just sequentially in terms of weight management products, maybe how that — if there’s anything to call out by region. I know India has been really strong. And then maybe just touch on kind of key new product rollouts for 2023, and then any new products that you have rolled out so far kind of traction you’re getting there so far this year? And then also as part of that just if you could just update us on the SKU rationalization process?

Alex Amezquita : Yes. So I’ll take just overall, I think, the bright spot of our product categories is that we think about it is still in the energy fitness category. If you look in the Q, we actually are having positive year-over-year net sales growth in that category. And that’s primarily being led by the energy products within that category and predominantly led by India as a region in driving that growth. I think for the rest of weight management and some of the other products, they’re just holding serve with the overall with the — how the overall markets are trending. So we’ll continue to our product rollouts, I think, you’ve seen some of them. We’ve talked about some of the vegan line coming out in North America, and some of our other products are really incremental to our existing product philosophies, but more to come on with products as we are launching Herbalife 2.0. I know we have — I don’t know if we want to mention you’d like to…

Michael Johnson: How many cats do you want to let out of the bag? You just mentioned the vegan line. So that’s okay. All right. So I’m looking at Frank, who’s our Chief Operating Officer now, and also the former Head of North America and the Americas. We’ve got a lot of products in the pipeline right now. Our product release program is extensive in this company. The SK — the SKU rat — that is going on inside the company is going to remove, Mark you’re sitting here, how many — what is the SKU rationalization number exactly?

Mark Schissel : 15% of our portfolio.