On Friday, Herbalife executives hosted congressional staffers for a Washington briefing on Herbalife’s business model and the wider direct selling industry.
The company’s Chief Financial Officer John DeSimone, along with VP and Managing Director of Herbalife North America Ibi Fleming, offered a presentation on “Direct Selling: An American Tradition” and welcomed questions from staffers.
The outreach follows hedge-fund investor Bill Ackman’s year-long campaign to discredit Herbalife’s business practices. The activist investor’s billion-dollar short bet against Herbalife has dropped 49 percent since inception, The Wall Street Journal reports, making it the biggest loss in the decade-long history of Ackman’s $12 billion Pershing Square fund. Last year Pershing Square exited its investment in J.C. Penney Co. with a slightly lower 41 percent loss.
Ackman’s claims have prompted action by a handful of lawmakers—most notably Senate Democrat Edward Markey of Massachusetts, who recently wrote letters urging further investigation of Herbalife by the Federal Trade Commission (FTC) and the Securities and Exchange Commission (SEC). On Thursday, Markey spokeswoman Giselle Barry told Reuters the senator is still awaiting responses.
Despite Ackman’s claims and the subsequent hurdles faced by Herbalife, the company reported fourth-quarter sales up nearly 20 percent to $1.27 billion. For the full year, Herbalife reported an 18 percent increase in net sales. Following fourth-quarter results, the company also adjusted its 2014 sales forecast to between 7.5 percent and 9.5 percent, down from the previous 9 percent to 11 percent; however, Herbalife raised its earnings forecast to $5.85 to $6.05 a share, up from $5.45 to $5.65.