Herbalife (HLF) Wins Approval in China to Operate in Three Additional Provinces

August 10, 2016 9:31 AM EDT

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Herbalife (NYSE: HLF), a global nutrition company, has won approval from China’s Ministry of Commerce to operate in three additional provinces with a population of about 57 million, which will contribute to our growth plans in the country.

The Gansu, Ningxia and Inner Mongolia provinces, which include three provincial capital cities and 16 districts, have completed their service outlet reviews that permit Herbalife to conduct direct selling activities.

China’s Ministry of Commerce granted the permits after reviewing the current business practices of Herbalife in the country. Herbalife has 300,000 service providers in China and licenses to operate in 25 other provinces.

“These approvals are a testament to our success in China and our future growth plans,” said Michael O. Johnson, chairman and CEO of Herbalife.

To meet increasing demand, in July Herbalife began operations at its newest facility in Nanjing, a 372,000-square-foot factory that will double Herbalife’s production capacity in China. Herbalife also operates factories in Changsha and Suzhou, and the three facilities combined can produce 60 million units annually. Altogether, Herbalife employs more than 1,300 people in China, including 124 at its new facility in Nanjing.

“Our business continues to expand as more consumers see Herbalife as a trusted, convenient and accessible nutrition brand,” said Jerry Li, senior vice president and manager of China operations for Herbalife. “Our nutrition clubs and preferred customer loyalty program are aimed at engaging Chinese consumers in improving their well-being and weight.”

Besides the three provinces, Herbalife is licensed to operate in these 25 provinces: Jiangsu, Shandong, Zhejiang, Guangdong, Guizhou, Beijing, Fujian, Sichuan, Hubei, Shan'xi, Jiangxi, Liaoning, Jilin, Henan, Chongqing, Shanghai, Tianjin, Shanxi, Hebei, Heilongjiang, Hunan, Anhui, Guangxi, Hainan and Yunnan.

Herbalife also has manufacturing facilities in Lake Forest, California, and Winston-Salem, North Carolina.

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