Good afternoon, and thank you for joining the Fourth Quarter and Full Year 2016 Earnings Conference Call for Herbalife Limited. On the call today is Michael Johnson, the company's Chairman and CEO; Richard Goudis, the company's COO; John DeSimone, the company's CFO; and Alan Quan, the company's Vice President, Investor Relations. I would now like to turn the call over to Alan Quan to read the company's Safe Harbor language.

Before we begin, as a reminder, during this conference call, comments may be made that include some forward-looking statements. These statements involve risk and uncertainty. And as you know, actual results may differ materially from those discussed or anticipated. We encourage you to refer to today's earnings release, and our SEC filings for a complete discussion of risks associated with these forward-looking statements in our business. We do not undertake any obligation to update or release any revisions to any forward-looking statement, or to report any future events or circumstances, or to reflect the occurrence of unanticipated events except as required by law. In addition, during this call, certain financial performance measures may be discussed that differ from comparable measures contained in our financial statements, prepared in accordance with U.S. Generally Accepted Accounting Principles, referred to by the Securities and Exchange Commission as non-GAAP financial measures. We believe that these non-GAAP financial measures assist management and investors in evaluating our performance and preparing period-to-period results of operations in a more meaningful and consistent manner as discussed in greater detail in the supplemental schedules to our earnings release. Please refer to the Investor Relations section of our website, herbalife.com, to find our press release for this quarter, which contains a reconciliation of these measures. Additionally, when management makes reference to volumes during this conference call, they are referring to volume points. I'll now turn the call over to our Chairman and CEO, Michael Johnson.

Thank you, Alan, and welcome, everyone. And I'm happy to say that we accomplished a lot in 2016 and I feel we are laying important ground work for the next 10 years at Herbalife Nutrition. That said, there are some key markets where we have work to do and I'll talk about those in just a minute. But let's start with the financial results. As you saw from our press release today, we delivered net sales that were equal to last year and up 6% in constant currency. It is important to note that foreign exchange headwinds continue to present a significant challenge. When we initiated 2016 guidance on our quarter three 2015 earnings call, we projected a $0.50 impact from currency. As the dollar continued to strengthen over the course of 2016, the actual impact was nearly double than original forecast, with an impact of $0.95 for the full year, including $0.11 for quarter four. We more than offset this impact by operating our business with rigor and control and demanding greater efficiencies every step of the way. Full year 2016 reported EPS was $3.02 compared to $3.97 for 2015, while our full year 2016 adjusted EPS was $4.85 compared to $4.95 for 2015. This was at the high end our guidance of $4.65 to $4.85. John will take you through our financial performance later in the call. Last week, we announced the closing of a $1.45 billion credit facility. Today, we are following up on last week's release by announcing that our board of directors has authorized a share buyback of up to $1.5 billion over three years. This initiative reflects our continued commitment to creating long-term shareholder value and signals the confidence we have for the future of our global nutrition business. We accomplished some important milestones…

Thank you, Michael, and good afternoon, everyone. 2017 will be transformational year for our company, as we implement retail sales tracking in the U.S., we are beginning to gather new consumer data and insights to help us to advance our strategic, operational and organizational approach to growth. In an industry that can, at times be labeled opaque, we are working hard to modernize the nature of our business. We've embraced this opportunity to complement our successful distribution efforts over the past 37 years with data-driven strategies to engage consumers on a far more personalized level, both through our distributors and directly with their consent. By mining this smart data, we can evaluate customer behavior patterns and usher in CPG-type loyalty, sales and marketing initiatives that will create a new catalyst for growth for our company. On our last earnings, we informed you that we had initiated a program in October in the United States that allowed existing distributors affirmatively self select the new status of preferred member. A preferred member at Herbalife Nutrition is an individual who exclusively joins to purchase our products, at a discount, may not resell our products or recruit someone into the business and is not eligible for any form of compensation from Herbalife. We shared with you early in November that we had approximately 50,000 preferred members at that time. As this self-selection conversion continued throughout the end of 2016, beginning in mid-January, new individual signing-up were able to select the category that best match their expectations. As a result of these conversions, of our existing members, coupled with new people signing up since January 12, the total number of preferred members has increased to approximately 300,000, clearly demonstrating that we have many members who are frequent users and purchasers of our products. Let me…

Thank you, Rich. Today, I'll go through the company's fourth quarter and full year 2016 reported and adjusted results, our new bank deal and recently board approved share repurchase program. And will conclude with our first quarter and full year of 2017 guidance. For the fourth quarter, worldwide volume points were 1.3 billion, which was approximately 1% below the fourth quarter in 2015. The lower volume was driven by the decline in China and a difficult comparison for India and Indonesia, during the fourth quarter of last year. Whereas noted last year, we had a price increase in Q4 2015 in both of these countries which had the effect of pulling forward 15 million to 20 million volume points into the prior year fourth quarter. For the year, worldwide volume points grew approximately 5% to 5.6 billion compared to 2015, which, as Michael previously noted, 2016 was a record year in volume points. Worldwide net sales for the fourth quarter were $1 billion, down 5% on a reported basis and down 1% on a constant currency basis compared to the fourth quarter in 2015. Full year 2016 worldwide net sales of $4.5 billion was flat with the prior year, while full year constant currency net sales increased 6% compared to the prior year period. Reported net income in the fourth quarter was $99.4 million or $1.16 per diluted share, compared to the reported net income of $84.5 million or $0.98 per diluted share for the fourth quarter in 2015. Full year 2016 reported net income was $260 million or $3.02 per diluted share, compared to reported net income of $339.1 million or $3.97 per diluted share for the full year 2015. Our reported EPS continues to include items that we consider to be outside of normal company operations, or we…

Thank you, John and Rich. The time is coming when the consumers should expect product, services and content to be customized and delivered to meet their personal wants and needs. We believe Herbalife Nutrition remains ahead of the curve and is well-positioned to activate our independent distributors towards improving people's lives through better nutrition and fitness every day. As we continue to support all of our regions on this journey, and as we understand even more about our customers' nutrition habits through data, we see a very bright future for our business and our nutrition purpose. I would like to take this opportunity to thank our incredible employees, our distributors, customers, and our shareholders for everything they do to help us serve our nutrition purpose in the world. Okay. Let's open it up to questions.

Our first question is from the line of April Scee from RenMac.

Hi, April. I'm not sure if April's there. Next question please, operator.

Certainly. Our next question is from the line of Tim Ramey from Pivotal Research Group.

Thanks so much.

Hey, Tim.

If we were thinking about the May 15 implementation, where would you say you are in terms of percentage completion of your task, essentially there 95% – there's still a little bit more work to do. How would you characterize that?

Yeah. Tim, this is Rich. I think in terms of tasks, I think all but really going live and turning on the new compensation system; everything else is either completed or just about complete. So, we feel very confident from the amount of tasks and we shared with you a lot of insights and data and numbers on how we're progressing on to very key metrics. And more importantly, listen, half of the U.S. population today for our member base are preferred customers, discount customers who can't resell the product or who don't want to sign up for somebody else. So, we put to rest all of the hard loss out there about not having real customers.

And John, I might to kind of back into the number that you think the impact of the debt deal alone, about $0.55 per share in 2017?

That's correct, yes.

Okay. It's a little bit higher than I thought it was going to be. In terms of choosing the structure for this share repurchase, obviously such action or some kind of more accelerated structure would have greater accretion benefits, why did you choose the structure that has less accretion?

Well, I'm not sure that we're – I agree with you now. So, I think, certainly, we have more accretion in 2017 if we did something immediate as opposed to doing it more on an efficient basis. I think, 2018, timing doesn't matter, only pricing and how efficient we execute the deal matters for 2018 and 2019 and 2020 and beyond. So, for long-term accretion, proper execution of a buyback from an economic standpoint is the most important thing. And by that way that may or may not be a tender – we haven't ruled it out. It's just an option that's on the table as well as a lot of other options.

Okay. Thanks.

And our next question is from the line of Michael Swartz from SunTrust.

Hey, good afternoon, guys.

Hey, Michael.

Just maybe run through China in a little more detail, just maybe what you've diagnosed there, maybe how you saw China progress through the quarter into February, and maybe how we should think about volume, revenue growth playing out through 2017?

Yeah, Hi, Michael. This is Des. So listen. obviously we spent a lot of time recently on China and very much focused on it, and what we've identified is two key areas. First of all, what we saw during the year is that a key group of our leaders there transitioned their business away from the club model and onto social media, what that drove was substantial increase in the short-term, in terms of social media's ability to embrace a large group of customers. But what we thought as we went through the year is that the stickiness of those customers that was minimal compared to what we would experience in the clubs. But as you know, our distributor leaders tend to follow success, and so when you have one group achieving significant success, others tend to follow that. But now, when we look into the numbers and we've actually analyzed the numbers along with our key leaders in the market, they've clearly recognized the falsity of that, and so that group is now switching back to what we've seen be effective in other markets, which is using social media as a tool to supplement rather than to replace activity in the club. The second situation is that we've seen the migration away from smaller clubs to larger clubs. And again in the short-term that seems like a good idea, right, because you actually have lower operating costs, you've got distributor, service providers working together, but as we know this is a neighborhood business and so people want to attend clubs in their neighborhood, and so what we saw is that initially these clubs very successful, but then we saw the actual customer counts drop off in those clubs. So, again when we compare those regions of the country where the clubs have remained following the traditional model of large number of clubs, the neighborhood clubs and compare that to the areas where they moved away from that model, the distinction is clear. So again, same philosophy work the distributor leader show them that by returning to what has worked in the past, it will work in the future, we now see our leaders focused on reverting to what has been successful in the past.

If I could just add a little bit to that, two comments. One is the number of active service providers in China is at a record high. So the number of people engaged is still strong, and that's a good sign. So, they're still involved in the business, so we can change their behavior. And second is regarding profiling China during the year, we said even before, the results in the fourth quarter were a little disappointing versus expectations that Q1 was going to be a difficult comp anyway, because of the timing of Chinese New Year. So Q1 will be a challenging quarter.

Okay. That's helpful. And then, maybe just within guidance and you're announcing this new JV in China with, I believe, it's Tasly, could you just give us a little bit more color on that? And then maybe John is that included in your guidance from both of maybe a cost perspective and the top-line perspective?

The cost is – there's no top-line yet, any benefit, first of all the benefit of the JV is going to take some time for sure. And second, there would be upside. And just one clarification before I pass it over to Rich to talk a little bit about the substance of the deal. It's a global deal with a Chinese company, I just want to make sure that's clear, it's not a Chinese deal.

Okay. Great.

So, I'm going to pass it over to Rich to provide a little more color.

Yeah, listen there's a very big strategic alliance between the philosophy of Tasly and Herbalife and our Seed to Feed initiatives. They have some very interesting technology from the standpoint of a seed tank. They have their own farms and fields. They have their own extraction facilities. And big picture, they have a lot of the intellectual property that we think with our commercialization know-how, we might be able to market around the world, so we're excited.

Our next question is from the line of April Scee from RenMac.

Hi. Sorry about earlier, guys. I just have two more questions on China. And the first is just on the China investigation, I was hoping you could give us an update and maybe provide some confidence that this is different than what we saw at Elan or Nu Skin and that it's not going to disrupt your business? And then just real quickly on the China JV if you don't mind. Is there any way in which this could actually help you in the China market in addition to the other reasons that you've stated for why the deal was done?

Yeah. I can take actually both of those. I'll start with the second one. The deal was done exclusively because Tasly has great content and we have great distribution and those two things can be a great marriage and it's a global – like I said, it's a global deal, and that was exclusively the reason. Regarding your first question, there's not a lot of color, we have a lot of confidence in our compliance program, we've spent a lot of resources and efforts on compliance in China. We have six internal auditors, we have big four accounting firms that are stationed in Shanghai and have been as part of our compliance program for a number of years and we have a strong commitment to compliance. And if we find somebody violated that commitment to compliance, then we'll deal with it, but there's nothing at this point to disclose.

Okay. Thanks, guys.

And at this time, I'm showing no more audio questions. I would like to turn the call back to Michael Johnson.

Thank you, everyone. Thanks for being with us today. And I think this meeting or this call summarizes that 2017 will be a transformational year for the company. We've got opportunities and challenges, but this is an incredibly resilient business. And I think we've pointed we're working with our distributors to make sure that we improve the trends in China and Korea. We've got a team of executives dispatched there, our distributors are very, very dedicated and we make sure that their passion is resultant in better sales in each of those markets. Our opportunity, as it always has, outweighs our challenges and we have a great future ahead of us, we've got a great company, a leverageable distribution channel and mega trends that'll provide a catalyst for growth for years to come. So, we thank you for being with us. We look forward to talking to you next quarter. Thank you very much.

Ladies and gentlemen, this does conclude today's conference. We thank you greatly for joining us for the Herbalife fourth quarter earnings conference call. You may now disconnect.