WW INTERNATIONAL, INC. WW International, Inc. , formerly known asWeight Watchers International, Inc. , is aVirginia corporation with its principal executive offices inNew York, New York . In this Quarterly Report on Form 10-Q unless the context indicates otherwise: "we," "us," "our," the "Company" and "WW" refer toWW International, Inc. and all of its operations consolidated for purposes of its financial statements; "North America" refers to ourNorth American Company -owned operations; "Continental Europe" refers to ourContinental Europe Company -owned operations; "United Kingdom" refers to ourUnited Kingdom Company -owned operations; and "Other" refers toAustralia ,New Zealand and emerging markets operations and franchise revenues and related costs.Each of North America , Continental Europe,United Kingdom and Other is also a reportable segment. Our "Digital" business refers to providing subscriptions to our digital product offerings, including Digital 360 and Personal Coaching + Digital. Our "Workshops + Digital" (formerly known as "Studio + Digital") business refers to providing unlimited access to our workshops combined with our digital subscription product offerings to commitment plan subscribers. It also includes the provision of access to workshops for members who do not subscribe to commitment plans, including our "pay-as-you-go" members.
Our fiscal year ends on the Saturday closest to
• "fiscal 2017" refers to our fiscal year endedDecember 30, 2017 ; • "fiscal 2018" refers to our fiscal year endedDecember 29, 2018 ; • "fiscal 2019" refers to our fiscal year endedDecember 28, 2019 ;
• "fiscal 2020" refers to our fiscal year ended
53rd week);
• "fiscal 2021" refers to our fiscal year ended January 1, 2022 ;
• "fiscal 2022" refers to our fiscal year ended December 31, 2022 ;
• "fiscal 2023" refers to our fiscal year ended December 30, 2023 ;
• "fiscal 2024" refers to our fiscal year ended December 28, 2024 ;
• "fiscal 2025" refers to our fiscal year ended
53rd week); and
• "fiscal 2026" refers to our fiscal year ended January 2, 2027 .
The following terms used in this Quarterly Report on Form 10-Q are our trademarks: Digital 360TM, myWW® and Weight Watchers®.
You should read the following discussion in conjunction with our Annual Report
on Form 10-K for fiscal 2020 as amended that includes additional information
about us, our results of operations, our financial position and our cash flows,
and with our unaudited consolidated financial statements and related notes
included in Item 1 of this Quarterly Report on Form 10-Q (collectively referred
to as the "Consolidated Financial Statements").
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--------------------------------------------------------------------------------NON-GAAP FINANCIAL MEASURES To supplement our consolidated results presented in accordance with accounting principles generally accepted inthe United States , or GAAP, we have disclosed non-GAAP financial measures of operating results that exclude or adjust certain items. Gross profit, gross profit margin, operating income and operating income margin are discussed in this Quarterly Report on Form 10-Q both as reported (on a GAAP basis) and as adjusted (on a non-GAAP basis), as applicable, with respect to the first quarter of fiscal 2021 to exclude the impact of the charges associated with our previously disclosed 2021 organizational restructuring plan and with respect to the first quarter of fiscal 2020 to exclude the impact of the impairment charge for our goodwill related to ourBrazil reporting unit. We generally refer to such non-GAAP measures as excluding or adjusting for the impact of the 2021 restructuring charges and the goodwill impairment charge. We also present within this Quarterly Report on Form 10-Q the non-GAAP financial measures: earnings before interest, taxes, depreciation, amortization and stock-based compensation ("EBITDAS"); earnings before interest, taxes, depreciation, amortization, stock-based compensation, restructuring charges and goodwill impairment ("Adjusted EBITDAS"); total debt less unamortized deferred financing costs, unamortized debt discount and cash on hand (i.e., net debt); and a net debt/Adjusted EBITDAS ratio. See "-Liquidity and Capital Resources-EBITDAS, Adjusted EBITDAS and Net Debt" for the reconciliations of these non-GAAP financial measures to the most comparable GAAP financial measure in each case. Our management believes these non-GAAP financial measures provide useful supplemental information to investors regarding the performance of our business and are useful for period-over-period comparisons of the performance of our business. While we believe that these non-GAAP financial measures are useful in evaluating our business, this information should be considered as supplemental in nature and is not meant to be considered in isolation or as a substitute for the related financial information prepared in accordance with GAAP. In addition, these non-GAAP financial measures may not be the same as similarly entitled measures reported by other companies.
USE OF CONSTANT CURRENCY
As exchange rates are an important factor in understanding period-to-period comparisons, we believe in certain cases the presentation of results on a constant currency basis in addition to reported results helps improve investors' ability to understand our operating results and evaluate our performance in comparison to prior periods. Constant currency information compares results between periods as if exchange rates had remained constant period-over-period. We use results on a constant currency basis as one measure to evaluate our performance. In this Quarterly Report on Form 10-Q, we calculate constant currency by calculating current-year results using prior-year foreign currency exchange rates. We generally refer to such amounts calculated on a constant currency basis as excluding or adjusting for the impact of foreign currency or being on a constant currency basis. These results should be considered in addition to, not as a substitute for, results reported in accordance with GAAP and are not meant to be considered in isolation. Results on a constant currency basis, as we present them, may not be comparable to similarly titled measures used by other companies and are not measures of performance presented in accordance with GAAP.
CRITICAL ACCOUNTING POLICIES
For a discussion of the critical accounting policies affecting us, see "Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations-Critical Accounting Policies" of our Annual Report on Form 10-K for fiscal 2020 as amended. Our critical accounting policies have not changed since the end of fiscal 2020. PERFORMANCE INDICATORS Our management team regularly reviews and analyzes a number of financial and operating metrics, including the key performance indicators listed below, in order to manage our business, measure our performance, identify trends affecting our business, determine the allocation of resources, make decisions regarding corporate strategies and assess the quality and potential variability of our cash flows and earnings. We also believe that these key performance indicators are useful to both management and investors for forecasting purposes and to facilitate comparisons to our historical operating results. These metrics are supplemental to our GAAP results and include operational measures.
• Revenues-Our "Subscription Revenues" consist of "Digital Subscription
Revenues" and "Workshops + Digital Fees" (formerly known as "Studio +
Digital Fees"). "Digital Subscription Revenues" consist of the fees
associated with subscriptions for our Digital offerings, including Digital
360 and Personal Coaching + Digital. "Workshops + Digital Fees" consist of
the fees associated with our subscription plans for combined workshops and
digital offerings and other payment arrangements for access to workshops.
In addition, "product sales and other" consists of sales of consumer
products via e-commerce, in studios and through our trusted partners,
revenues from licensing and publishing, other revenues (including revenues
from the WW Presents:
consolidated financial results and Other reportable segment, franchise
fees with respect to commitment plans and royalties.
26
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• Paid Weeks-The "Paid Weeks" metric reports paid weeks by WW customers in
Company-owned operations for a given period as follows: (i) "Digital Paid
Weeks" is the total paid subscription weeks for our digital subscription
products (including Digital 360 and Personal Coaching + Digital);
(ii) "Workshops + Digital Paid Weeks" (formerly known as "Studio + Digital
Paid Weeks") is the sum of total paid commitment plan weeks which include
workshops and digital offerings and total "pay-as-you-go" weeks; and
(iii) "Total Paid Weeks" is the sum of Digital Paid Weeks and Workshops +
Digital Paid Weeks.
• Incoming Subscribers-"Subscribers" refer to Digital subscribers and
Workshops + Digital subscribers who participate in recur bill programs in
Company-owned operations. The "Incoming Subscribers" metric reports WW
subscribers in Company-owned operations at a given period start as
follows: (i) "Incoming Digital Subscribers" is the total number of
Digital, including Digital 360 and Personal Coaching + Digital,subscribers; (ii) "Incoming Workshops + Digital Subscribers" (formerly
known as "
commitment plan subscribers that have access to combined workshops and
digital offerings; and (iii) "Incoming Subscribers" is the sum of Incoming
Digital Subscribers and Incoming Workshops + Digital Subscribers.
Recruitment and retention are key drivers for this metric.
• End of Period Subscribers-The "End of Period Subscribers" metric reports
WW subscribers in Company-owned operations at a given period end as
follows: (i) "End of Period Digital Subscribers" is the total number of
Digital, including Digital 360 and Personal Coaching + Digital,
subscribers; (ii) "End of Period Workshops + Digital Subscribers"
(formerly known as "End of Period Studio + Digital Subscribers") is thetotal number of commitment plan subscribers that have access to combined
workshops and digital offerings; and (iii) "End of Period Subscribers" is
the sum of End of Period Digital Subscribers and End of Period Workshops +
Digital Subscribers. Recruitment and retention are key drivers for this
metric.
• Gross profit and operating expenses as a percentage of revenue.
COVID-19 PANDEMIC
The novel coronavirus (COVID-19) pandemic continues to impact our business operations and the markets in which we operate. While the outbreak of COVID-19 did not have a significant effect on our reported results for the first quarter of fiscal 2020, it did have a significant effect on our reported results for the remainder of fiscal 2020 and the first quarter of fiscal 2021. The number of End of Period Subscribers for the first quarter of fiscal 2021 decreased 1.5% versus the prior year period. The challenging COVID-19 environment for our Workshops + Digital business drove a significant decrease in End of Period Workshops + Digital Subscribers for the first quarter of fiscal 2021 versus the prior year period, which was partially offset by the increase in End of Period Digital Subscribers. The negative impact of COVID-19 is expected to continue to significantly impact the Workshops + Digital business in the second quarter of fiscal 2021 and potentially in subsequent periods. The extent to which our operations and business trends will continue in future periods to be impacted by, and any unforeseen costs will result from, the ongoing outbreak of COVID-19 and any virus variants will depend largely on future developments, which are highly uncertain and cannot be accurately predicted. These developments include, among other things, new information that may emerge concerning the severity of the outbreak, health implications and vaccine availability, actions by government authorities to contain the outbreak or treat its impact, and changes in consumer behavior resulting from the outbreak and such government actions. We continue to actively monitor the ongoing global outbreak of COVID-19 and its impact and related developments and expect that it will significantly impact our reported results for the first half of fiscal 2021 and may potentially do so in subsequent periods. In response to the public health crisis posed by COVID-19, inMarch 2020 , we suspended our in-person workshops and moved quickly to transition these workshops to an entirely virtual experience. InJune 2020 , we began a phased re-opening with reduced operations of a limited number of our studio locations. We continue to evolve our workshop strategy as we evaluate our cost structure and respond to shifting consumer sentiment. We are selectively resuming in-person workshops where we can in a cost-efficient manner that promotes the health and safety of our employees and members. However, during these uncertain times, we may need to close re-opened studios, may not be able to open studios as planned or may need to further reduce operations. We continue to serve our members virtually, both via our Digital business and through virtual workshops now available to our Workshops + Digital subscribers. Nevertheless, our business operations, recruitment trends with respect to our Workshops + Digital business and in-studio product sales remain substantially affected by our reduced operations. We expect that applicable regulatory restrictions, including continued or reinstated stay-at-home requirements and restrictions on in-person group gatherings, may impact our studio operations, including how we conduct our in-person workshops. 27
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As we continue to address the impact of the pandemic, and the related evolving
legal and consumer landscape, we are focused on how to best meet our members'
and consumers' needs as restrictions are lifted or reinstated. We consolidated
certain of our studios into branded studio locations and continue to close
certain other branded studio locations. The decision to re-open a studio
location, if at all, or further consolidate studio locations, will be influenced
by a number of factors, including applicable legal restrictions, consumer
confidence and preferences, changes in consumer behavior, and the protection of
the health and safety of our employees and members, and will be dependent on
cost efficiencies and alignment with our digital and brand strategy. The current
number of our studio locations is significantly lower than that prior to the
pandemic, and we expect it to remain below pre-COVID-19 levels. As a result, we
have incurred and will incur significant costs associated with our real estate
realignment.
While we expect the effects of the pandemic and the related responses to
negatively impact our results of operations, cash flows and financial position,
the uncertainty of the full extent of the duration and severity of the economic
and operational impacts of COVID-19 means we cannot reasonably estimate the
related financial impact at this time. For more information, see "Item 1A. Risk
Factors" in Part I of our Annual Report on Form 10-K for fiscal 2020 as amended.
We continue to believe that our powerful communities and our ability to inspire
people to adopt healthy habits will be invaluable to people across the globe as
they continue to acclimate to new social and economic environments, and that
they uniquely position us in the markets in which we operate.
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--------------------------------------------------------------------------------RESULTS OF OPERATIONS
THREE MONTHS ENDED
The table below sets forth selected financial information for the first quarter of fiscal 2021 from our consolidated statements of net income for the three months endedApril 3, 2021 versus selected financial information for the first quarter of fiscal 2020 from our consolidated statements of net income for the three months endedMarch 28, 2020 . Summary of Selected Financial Data (In millions, except per share amounts) For The Three Months Ended % Change Increase/ % Constant April 3, 2021 March 28, 2020 (Decrease) Change Currency Revenues, net $ 331.8 $ 400.4$ (68.6 ) (17.1 %) (19.7 %) Cost of revenues 138.4 189.4 (51.0 ) (26.9 %) (28.6 %) Gross profit 193.4 211.0 (17.6 ) (8.3 %) (11.8 %) Gross Margin % 58.3 % 52.7 % Marketing expenses 116.9 117.9 (1.0 ) (0.8 %) (4.1 %)
Selling, general & administrative
expenses 73.7 64.5 9.1 14.2 % 12.3 % Goodwill impairment - 3.7 (3.7 ) (100.0 %) (100.0 %) Operating income 2.8 24.9 (22.0 ) (88.6 %) (97.4 %) Operating Income Margin % 0.9 % 6.2 % Interest expense 29.1 31.6 (2.4 ) (7.7 %) (7.7 %) Other (income) expense, net (0.2 ) 0.0 (0.3 ) 100.0 % * 100.0 % * Loss before income taxes (26.1 ) (6.7 ) (19.3 ) 100.0 % * 100.0 % * Benefit from income taxes (7.8 ) (0.7 ) (7.2 ) 100.0 % * 100.0 % * Net loss (18.2 ) (6.1 ) (12.2 ) 100.0 % * 100.0 % *
Net income attributable to the
noncontrolling interest - (0.0 ) 0.0 (100.0 %) (100.0 %)
Net loss attributable to
WW International, Inc. $ (18.2 ) $ (6.1
)
Weighted average diluted shares
outstanding 69.1 67.4 1.6 2.4 % 2.4 % Diluted loss per share $ (0.26 ) $ (0.09 )$ (0.17 ) 100.0 % * 100.0 % *
Note: Totals may not sum due to rounding.
*Note: Percentage in excess of 100.0%.
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-------------------------------------------------------------------------------- Certain results for the first quarter of fiscal 2021 are adjusted to exclude the impact of the$5.5 million of 2021 restructuring charges. See "Non-GAAP Financial Measures" above. The table below sets forth a reconciliation of certain of those components of our selected financial data for the three months endedApril 3, 2021 which have been adjusted. Gross Operating Gross Profit Operating Income (in millions except percentages) Profit Margin Income Margin First Quarter of Fiscal 2021$ 193.4 58.3 %$ 2.8 0.9 % Adjustments to reported amounts (1) 2021 restructuring charges 5.2
5.5
Total adjustments (1) 5.2
5.5
First Quarter of Fiscal 2021, as adjusted (1)
2.5 %
Note: Totals may not sum due to rounding.
(1) The "As adjusted" measure is a non-GAAP financial measure that adjusts the
consolidated statements of net income for the first quarter of fiscal 2021 to
exclude the impact of the $5.5 million ($4.1 million after tax) of 2021
restructuring charges. See "Non-GAAP Financial Measures" above for an
explanation of our use of non-GAAP financial measures.
Certain results for the first quarter of fiscal 2020 are adjusted to exclude the
impact of the $3.7 million impairment charge for goodwill related to our Brazil
reporting unit. See "Non-GAAP Financial Measures" above. The table below sets
forth a reconciliation of certain of those components of our selected financial
data for the three months ended March 28, 2020 which have been adjusted.
Operating
Operating Income
(in millions except percentages) Income Margin
First Quarter of Fiscal 2020 $ 24.9 6.2 %
Adjustments to reported amounts (1)
Goodwill impairment 3.7
Total adjustments (1) 3.7
First Quarter of Fiscal 2020, as adjusted (1) $ 28.5 7.1 %
Note: Totals may not sum due to rounding.
(1) The "As adjusted" measure is a non-GAAP financial measure that adjusts the
consolidated statements of net income for the first quarter of fiscal 2020 to
exclude the impact of the
charge for goodwill related to our
Financial Measures" above for an explanation of our use of non-GAAP financial
measures.
Consolidated Results
Revenues
Revenues in the first quarter of fiscal 2021 were $331.8 million , a decrease of
$68.6 million , or 17.1%, versus the first quarter of fiscal 2020. Excluding the
impact of foreign currency, which positively impacted our revenues for the first
quarter of fiscal 2021 by $10.4 million , revenues in the first quarter of fiscal
2021 would have decreased 19.7% versus the prior year period. This decrease was
driven primarily by lower revenues related to Workshops + Digital Fees and
in-studio product sales as a result of the closure of our studios and reduced
operations related to the COVID-19 pandemic. In North America , revenue also
declined as we cycled against the revenues from the WW Presents: Oprah 's 2020
Vision tour. See "-Segment Results" for additional details on revenues.
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--------------------------------------------------------------------------------Cost of Revenues and Gross Profit
Total cost of revenues in the first quarter of fiscal 2021 decreased$51.0 million , or 26.9%, versus the prior year period. Excluding the impact of$5.2 million of 2021 restructuring charges, total cost of revenues in the first quarter of fiscal 2021 would have decreased by 29.7%, or 31.3% on a constant currency basis, versus the prior year period. Gross profit decreased$17.6 million , or 8.3%, in the first quarter of fiscal 2021 compared to the first quarter of fiscal 2020. Excluding the impact of foreign currency, which positively impacted gross profit for the first quarter of fiscal 2021 by$7.2 million , gross profit in the first quarter of fiscal 2021 would have decreased 11.8% versus the prior year period. Excluding the impact of$5.2 million of 2021 restructuring charges, gross profit in the first quarter of fiscal 2021 would have decreased by 5.9%, or 9.3% on a constant currency basis, versus the prior year period primarily due to the decrease in revenues. Gross margin in the first quarter of fiscal 2021 increased 5.6% to 58.3% versus 52.7% in the first quarter of fiscal 2020. Excluding the impact of foreign currency, gross margin in the first quarter of fiscal 2021 would have increased 5.2% to 57.9% versus the prior year period. Excluding the impact of the 2021 restructuring charges, gross margin in the first quarter of fiscal 2021 would have increased 7.2% to 59.9% versus the prior year period. Excluding the impact of both foreign currency and the 2021 restructuring charges, gross margin in the first quarter of fiscal 2021 would have increased 6.8% to 59.5% versus the prior year period. Gross margin increase was driven primarily by a mix shift to our higher margin Digital business and cycling against the net profit from the WW Presents:Oprah 's 2020 Vision tour as a percentage of revenue, offset in part by a contraction of margins in the Workshops + Digital business and lower margins related to consumer product sales.
Marketing
Marketing expenses in the first quarter of fiscal 2021 decreased$1.0 million , or 0.8%, versus the first quarter of fiscal 2020. Excluding the impact of foreign currency, which increased marketing expenses for the first quarter of fiscal 2021 by$3.9 million , marketing expenses in the first quarter of fiscal 2021 would have decreased 4.1% versus the first quarter of fiscal 2020. This decrease in marketing expenses was primarily due to fiscal 2020 including a 53rd week, which bridged the last week ofDecember 2020 and ended onJanuary 2, 2021 . This 53rd week had a high concentration of advertising spending and thus pushed a portion of the marketing expense into the fourth quarter of fiscal 2020. Marketing expenses as a percentage of revenue for the first quarter of fiscal 2021 increased to 35.2% from 29.5% for the first quarter of fiscal 2020.
Selling, General and Administrative
Selling, general and administrative expenses in the first quarter of fiscal 2021 increased$9.1 million , or 14.2%, versus the first quarter of fiscal 2020. Excluding the impact of foreign currency, which increased selling, general and administrative expenses for the first quarter of fiscal 2021 by$1.2 million , selling, general and administrative expenses in the first quarter of fiscal 2021 would have increased 12.3% versus the prior year period. Excluding the impact of the$0.3 million of 2021 restructuring charges, selling, general and administrative expenses in the first quarter of fiscal 2021 would have increased by 13.7%, or 11.8% on a constant currency basis, versus the prior year period. The increase in selling, general and administrative expenses in the first quarter of fiscal 2021 was driven primarily by the timing of bonus payouts and related costs in fiscal 2021 and the negative impact of COVID-19 on our bonus payout for fiscal 2020. Selling, general and administrative expenses as a percentage of revenue for the first quarter of fiscal 2021 increased to 22.2% from 16.1% for the first quarter of fiscal 2020.
Impairment
For the first quarter of fiscal 2020, in performing our interim impairment analysis for ourBrazil reporting unit, we determined that, based on the fair values calculated, the carrying amount of goodwill related to ourBrazil reporting unit exceeded our fair value and recorded an impairment charge of$3.7 million . Operating Income Operating income in the first quarter of fiscal 2021 decreased$22.0 million , or 88.6%, versus the prior year period. Excluding the impact of foreign currency, which positively impacted operating income for the first quarter of fiscal 2021 by$2.2 million , operating income in the first quarter of fiscal 2021 would have decreased 97.4% versus the prior year period. Excluding the impact of the$5.5 million of 2021 restructuring charges in the first quarter of fiscal 2021 and the$3.7 million goodwill impairment charge related to ourBrazil reporting unit in the first quarter of fiscal 2020, operating income in the first quarter of fiscal 2021 would have decreased by 70.7%, or 78.3% on a constant currency basis, versus the prior year period. Operating income margin in the first quarter of fiscal 2021 decreased 5.4% to 0.9% versus 6.2% in the first quarter of fiscal 2020. Excluding the impact of the 2021 restructuring charges in the first quarter of fiscal 2021 and the goodwill impairment charge in the first quarter of fiscal 2020, operating income margin in the first quarter of fiscal 2021 would have decreased by 4.6%, or 5.2% on a constant currency basis, versus the prior year period. The decrease in operating income margin was driven primarily by an increase in selling, general and administrative expenses as a percentage of revenue and an increase in marketing expenses as a percentage of revenue, partially offset by an increase in gross margin, versus the prior year period. 31
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Interest Expense Interest expense in the first quarter of fiscal 2021 decreased$2.4 million , or 7.7%, versus the first quarter of fiscal 2020. The decrease in interest expense was driven primarily by a decrease in our outstanding indebtedness resulting from principal repayments. The effective interest rate on our debt, based on interest incurred (which includes amortization of our deferred financing costs and debt discount) and our average borrowings during the first quarter of fiscal 2021 and the first quarter of fiscal 2020 and excluding the impact of our interest rate swaps then in effect, decreased to 6.59% per annum at the end of the first quarter of fiscal 2021 from 7.54% per annum at the end of the first quarter of fiscal 2020. Including the impact of our interest rate swaps then in effect, the effective interest rate on our debt, based on interest incurred (which includes amortization of our deferred financing costs and debt discount) and our average borrowings during the first quarter of fiscal 2021 and the first quarter of fiscal 2020, decreased to 7.56% per annum at the end of the first quarter of fiscal 2021 from 7.82% per annum at the end of the first quarter of fiscal 2020. See "-Liquidity and Capital Resources-Long-Term Debt" for additional details regarding our debt, including interest rates and payments thereon. For additional details on our interest rate swaps, see "Item 3. Quantitative and Qualitative Disclosures about Market Risk" in Part I of this Quarterly Report on Form 10-Q.
Other (Income) Expense, Net
Other (income) expense, net, which consists primarily of the impact of foreign currency on intercompany transactions, changed by$0.3 million in the first quarter of fiscal 2021 to$0.2 million of income as compared to$0.0 million of expense in the prior year period.
Tax
Our effective tax rate in the first quarter of fiscal 2021 was 30.0% as compared to 9.7% in the first quarter of fiscal 2020. The effective tax rate in the first quarter of fiscal 2021 was impacted by state income tax expense and tax expense from income earned in foreign jurisdictions, partially offset by a tax benefit related to foreign-derived intangible income and a tax benefit related to tax windfalls from stock compensation. The effective tax rate in the first quarter of fiscal 2020 was impacted by an impairment of ourBrazil reporting unit which had a full valuation allowance, tax expense related to global intangible low-taxed income and state income tax expense, partially offset by a tax benefit from income earned in foreign jurisdictions.
Net Loss Attributable to the Company and Loss Per Share
Net loss attributable to the Company in the first quarter of fiscal 2021 of$18.2 million , increased$12.2 million , or 200.6%, from the net loss attributable to the Company in the first quarter of fiscal 2020 of$6.1 million . Excluding the impact of foreign currency, which positively impacted net loss attributable to the Company in the first quarter of fiscal 2021 by$1.6 million , net loss attributable to the Company in the first quarter of fiscal 2021 would have increased 227.0% from the first quarter of fiscal 2020. Net loss attributable to the Company in the first quarter of fiscal 2021 included a$4.1 million impact from 2021 restructuring charges. Net loss attributable to the Company in the first quarter of fiscal 2020 included a$2.7 million impact from the goodwill impairment charge related to ourBrazil reporting unit. Diluted net loss per share in the first quarter of fiscal 2021 was a loss of$0.26 compared to a loss of$0.09 per share in the first quarter of fiscal 2020. Diluted net loss per share in the first quarter of fiscal 2021 included a$0.06 impact from 2021 restructuring charges. Diluted net loss per share in the first quarter of fiscal 2020 included a$0.05 impact from the goodwill impairment charge related to ourBrazil reporting unit. 32 --------------------------------------------------------------------------------
Segment Results Metrics and Business Trends The following tables set forth key metrics by reportable segment for the first quarter of fiscal 2021 and the percentage change in those metrics versus the prior year period:
(in millions except percentages and as noted)
Q1 2021
GAAP Constant Currency
Product Product Total
Subscription Sales & Total Subscription Sales & Total Paid Incoming EOP
Revenues Other Revenues Revenues Other Revenues Weeks Subscribers Subscribers
(in thousands)
North America $ 187.0 $ 34.3 $ 221.3 $ 186.3 $ 34.2 $ 220.5 40.1 2,822.3 3,160.5
CE 69.9 12.0 81.9 63.8 11.0 74.8 17.1 1,179.6 1,349.1
UK 15.0 4.1 19.1 13.9 3.8 17.7 4.4 323.5 340.3
Other (1) 8.0 1.5 9.5 7.1 1.4 8.5 1.4 97.7 107.0
Total $ 279.8 $ 52.0 $ 331.8 $ 271.0 $ 50.4 $ 321.4 63.1 4,423.0 4,956.9
% Change Q1 2021 vs. Q1 2020
North America (18.4 %) (37.0 %) (22.0 %) (18.7 %) (37.3 %) (22.3 %) (5.3 %) 3.7 % (2.8 %)
CE 2.5 % 1.8 % 2.4 % (6.5 %) (7.0 %) (6.5 %) 6.8 % 11.3 % 6.8 %
UK (19.9 %) (35.3 %) (23.8 %) (25.7 %) (39.7 %) (29.2 %) (19.2 %) (10.5 %)
(15.8 %)
Other (1) (7.1 %) (49.7 %) (18.2 %) (17.9 %) (54.1 %) (27.4 %) (7.2 %) (4.3 %) (7.8 %)
Total (13.8 %) (31.3 %) (17.1 %) (16.5 %) (33.4 %) (19.7 %) (3.5 %) 4.2 % (1.5 %)
Note: Totals may not sum due to rounding.
(1) Represents Australia,
franchise revenues.
(in millions except percentages and as noted)
Q1 2021
Workshops Incoming EOP
Digital Subscription Revenues Digital Incoming EOP Workshops + Digital Fees + Digital Workshops Workshops
Constant Paid Digital Digital Constant Paid + Digital + Digital
GAAP Currency Weeks Subscribers Subscribers GAAP Currency Weeks Subscribers Subscribers
(in thousands) (in thousands)
North America $ 132.1 $ 131.6 33.5 2,334.1 2,630.7 $ 54.9 $ 54.7 6.7 488.2 529.8
CE 58.9 53.8 15.5 1,059.9 1,237.8 10.9 10.0 1.5 119.7 111.3
UK 9.8 9.1 3.4 235.0 267.2 5.2 4.8 1.0 88.5 73.0
Other (1) 5.2 4.6 1.1 74.0 81.7 2.7 2.5 0.3 23.7 25.3
Total $ 206.1 $ 199.0 53.5 3,703.0 4,217.5 $ 73.8 $ 72.0 9.6 720.0 739.5
% Change Q1 2021 vs. Q1 2020
North America 13.5 % 13.1 % 13.8 % 24.8 % 13.8 % (51.3 %) (51.5 %) (48.6 %) (42.7 %) (43.6 %)
CE 26.3 % 15.3 % 20.0 % 22.8 % 19.9 % (49.2 %) (53.6 %) (49.6 %) (39.1 %) (51.8 %)
UK 29.5 % 20.1 % 17.9 % 23.9 % 21.0 % (53.6 %) (56.9 %) (60.2 %) (48.5 %) (60.1 %)
Other (1) 31.8 % 15.7 % 15.2 % 20.1 % 13.2 % (40.6 %) (46.9 %) (42.8 %) (41.5 %) (42.3 %)
Total 18.1 % 14.0 % 15.8 % 24.0 % 16.0 % (50.9 %) (52.1 %) (50.1 %) (42.9 %) (47.1 %)
Note: Totals may not sum due to rounding.
(1) Represents Australia,
franchise revenues.
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North America Performance The decrease inNorth America revenues in the first quarter of fiscal 2021 versus the prior year period was driven by both a decrease in Subscription Revenues and a decrease in product sales and other. The decrease in Subscription Revenues in the first quarter of fiscal 2021 versus the prior year period was driven by a decrease in Workshops + Digital Fees, partially offset by an increase in Digital Subscription Revenues. Workshops + Digital Fees were negatively impacted by the significant recruitment decline in the first quarter of fiscal 2021 driven by the closure of certain of our studios and the limited reopening of others primarily related to the COVID-19 environment. The decrease in North America Total Paid Weeks was driven primarily by lower recruitments in the first quarter of fiscal 2021 versus the prior year period due to cycling against the successful launch of the myWW program in the first quarter of fiscal 2020 and the COVID-19 environment. The decrease inNorth America product sales and other in the first quarter of fiscal 2021 versus the prior year period was driven primarily by a decrease in in-studio product sales and the revenue received in connection with the WW Presents:Oprah 's 2020 Vision tour in the first quarter of fiscal 2020.
Continental Europe Performance
The increase in Continental Europe revenues in the first quarter of fiscal 2021 versus the prior year period was driven primarily by an increase in Subscription Revenues. The increase in Subscription Revenues in the first quarter of fiscal 2021 versus the prior year period was driven by an increase in Digital Subscription Revenues, partially offset by a decrease in Workshops + Digital Fees. Workshops + Digital Fees were negatively impacted by the significant recruitment decline in the first quarter of fiscal 2021 driven by the closure of certain of our studios and the limited reopening of others primarily related to the COVID-19 environment. The increase in Continental Europe Total Paid Weeks was driven primarily by the higher number of Incoming Digital Subscribers at the beginning of the first quarter of fiscal 2021 versus the beginning of the first quarter of fiscal 2020 and higher Digital recruitments in the first quarter of fiscal 2021 versus the prior year period. The increase in Continental Europe product sales and other in the first quarter of fiscal 2021 versus the prior year period was driven primarily by an increase in e-commerce product sales. United Kingdom Performance The decrease inUK revenues in the first quarter of fiscal 2021 versus the prior year period was driven by both a decrease in Subscription Revenues and a decrease in product sales and other. The decrease in Subscription Revenues in the first quarter of fiscal 2021 versus the prior year period was driven by a decrease in Workshops + Digital Fees, partially offset by an increase in Digital Subscription Revenues. Workshops + Digital Fees were negatively impacted by the significant recruitment decline in the first quarter of fiscal 2021 driven by the closure of certain of our studios and the limited reopening of others primarily related to the COVID-19 environment. The decrease inUK Total Paid Weeks was driven primarily by lower recruitments in the first quarter of fiscal 2021 versus the prior year period due to cycling against the successful launch of the myWW program in the first quarter of fiscal 2020 and the COVID-19 environment. The decrease inUK product sales and other in the first quarter of fiscal 2021 versus the prior year period was driven primarily by a decrease in in-studio product sales. Other Performance The decrease in Other revenues in the first quarter of fiscal 2021 versus the prior year period was driven by both a decrease in product sales and other and a decrease in Subscription Revenues. The decrease in Subscription Revenues in the first quarter of fiscal 2021 versus the prior year period was driven by a decrease in Workshops + Digital Fees. Workshops + Digital Fees were negatively impacted by the significant recruitment decline in the first quarter of fiscal 2021 driven by the closure of certain of our studios and the limited reopening of others primarily related to the COVID-19 environment.
The decrease in Other product sales and other in the first quarter of fiscal 2021 versus the prior year period was driven primarily by a decrease in franchise commissions and a decrease in product sales.
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--------------------------------------------------------------------------------LIQUIDITY AND CAPITAL RESOURCES
Cash flows provided by operating activities have historically supplied, and are expected to continue to supply, us with our primary source of liquidity. We use these cash flows, supplemented with long-term debt and short-term borrowings, to fund our operations and global strategic initiatives, pay down debt and engage in selective acquisitions. We currently believe that cash generated by operations, our cash on hand of approximately$113.3 million atApril 3, 2021 , our$173.8 million of availability under our New Revolving Credit Facility (as defined below) and our continued cost focus will provide us with sufficient liquidity to meet our obligations for the next twelve months. In addition, if necessary, we have the flexibility to delay investments or reduce marketing spend. We continue to proactively manage our liquidity so we can maintain flexibility to fund investments in our business, honor our long-term debt obligations, and respond to evolving business and consumer conditions arising from the COVID-19 pandemic. To increase our flexibility and reduce our cash interest payments, we refinanced our Terminated Credit Facilities and Discharged Senior Notes (each as defined below) inApril 2021 . See "-Long-Term Debt-April 2021 Debt Refinancing" for additional details on this refinancing. Additionally, we instituted a number of measures throughout our operations to mitigate expenses and reduce costs as well as ensure liquidity and the availability of our New Revolving Credit Facility. The evolving nature, and uncertain economic impact, of COVID-19 and any variants may impact our liquidity going forward. To the extent that we do not successfully manage our costs, our liquidity and financial results, as well as our ability to access our New Revolving Credit Facility, may be adversely affected. As market conditions warrant, we may, from time to time, seek to purchase our outstanding debt securities or loans, including the Senior Secured Notes and borrowings under the New Credit Facilities (each as defined below). Such transactions could be privately negotiated or open market transactions, pursuant to tender offers or otherwise. Subject to any applicable limitations contained in the agreements governing, or terms of, our indebtedness, any such purchases made by us may be funded by the use of cash on our balance sheet, the incurrence of new secured or unsecured debt, the issuance of our equity or the sale of assets. The amounts involved in any such purchase transactions, individually or in the aggregate, may be material. Any such purchases may equate to a substantial amount of a particular class or series of debt, which may reduce the trading liquidity of such class or series.
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