Fourth Quarter 2023
- End of Period Subscribers of 3.8 million, including 67 thousand End of Period Clinical Subscribers
- Revenues of
$206.0 million - Gross margin of 60.6%; excluding the net impact of restructuring charges, adjusted gross margin of 61.4%
- Operating Loss of
$6.0 million ; excluding the net impact of restructuring charges and non-cash intangible impairment charges, adjusted operating income of$21.3 million
Full Year Fiscal 2023
- Revenues of
$889.6 million - Gross margin of 59.5%; excluding the net impact of restructuring charges, adjusted gross margin of 61.9%
- Operating Income of
$22.3 million ; excluding the net impact of restructuring charges, acquisition transaction costs, and non-cash intangible impairment charges, adjusted operating income of$89.5 million
Company Provides Full Year Fiscal 2024 Guidance
“2023 was a pivotal year as we began transforming our business for the future. We returned WeightWatchers to year end subscriber growth – for the first time in 3 years - up 7% year-over-year,” said
“WeightWatchers is creating the category of
“We executed against our 2023 objectives with a return to sign up and subscriber growth, record adjusted gross margin, and improved cost structure,” said
Q4 2023 Consolidated Results
% Change | % Change Adjusted for Constant Currency(1) | ||||||||
Three Months Ended | |||||||||
2023 | 2022(7) | ||||||||
(in millions except percentages and per share amounts) | |||||||||
Subscription Revenues, net | (2.4%) | (3.6%) | |||||||
Product Sales and Other, net | 9.9 | 22.0 | (55.1%) | (55.3%) | |||||
Revenues, net | (7.6%) | (8.7%) | |||||||
Gross Profit | (0.9%) | (2.4%) | |||||||
Non-GAAP Adjustments(1) | |||||||||
Net Restructuring Charges(2) | 1.5 | 3.1 | |||||||
Adjusted Gross Profit(1) | (2.1%) | (3.6%) | |||||||
Operating Loss | ( | ( | (88.4%) | (86.7%) | |||||
Non-GAAP Adjustments(1) | |||||||||
Franchise Rights Acquired and Goodwill Impairments | 3.6 | 57.6 | |||||||
Net Restructuring Charges(2) | 23.6 | 17.4 | |||||||
Adjusted Operating Income(1) | (8.1%) | (12.4%) | |||||||
Net Loss | ( | ( | 100.0%* | 100.0%* | |||||
EPS | ( | ( | 100.0%* | 100.0%* | |||||
Total Paid Weeks | 50.4 | 47.3 | 6.5% | N/A | |||||
Digital(3) Paid Weeks | 41.0 | 37.8 | 8.6% | N/A | |||||
Workshops + Digital(4) Paid Weeks | 8.7 | 9.6 | (9.2%) | N/A | |||||
Clinical(5) Paid Weeks | 0.7 | - | N/A | N/A | |||||
End of Period Subscribers(6) | 3.8 | 3.5 | 7.1% | N/A | |||||
Digital Subscribers | 3.1 | 2.8 | 8.6% | N/A | |||||
Workshops + Digital Subscribers | 0.7 | 0.7 | (8.3%) | N/A | |||||
Clinical Subscribers | 0.1 | - | N/A | N/A | |||||
___________________________________ Note: Totals may not sum due to rounding. *Note: Percentage in excess of 100.0% and not meaningful.
| |||||||||
Q4 2023 Business and Financial Highlights
- End of Period Subscribers in Q4 2023 were up 7.1% versus the prior year period, driven by the Digital business and the inclusion of 67 thousand Clinical Subscribers. Q4 2023 End of Period Digital Subscribers increased 8.6% versus the prior year period. Q4 2023 End of Period Workshops + Digital Subscribers decreased 8.3% versus the prior year period.
- Total Paid Weeks in Q4 2023 were up 6.5% versus the prior year period, driven by the Digital business and the inclusion of 719 thousand Clinical Paid Weeks. Q4 2023 Digital Paid Weeks increased 8.6% versus the prior year period. Q4 2023 Workshops + Digital Paid Weeks decreased 9.2% versus the prior year period.
- Revenues in Q4 2023 were
$206.0 million . On a constant currency basis, Q4 2023 revenues decreased 8.7% versus the prior year period.- Subscription Revenues in Q4 2023 were
$196.1 million . On a constant currency basis, these revenues decreased 3.6% versus the prior year period. Subscription Revenues included$13.0 million of Clinical Subscription Revenues. - Product Sales and Other in Q4 2023 were
$9.9 million . On a constant currency basis, these revenues decreased 55.3% versus the prior year period driven by the wind down of the consumer products business.
- Subscription Revenues in Q4 2023 were
- Gross Profit in Q4 2023 was
$124.9 million , compared to$126.0 million in the prior year period. Adjusted gross profit in Q4 2023, which excluded the net impact of$1.5 million of restructuring charges, was$126.4 million . Adjusted gross profit in Q4 2022, which excluded the net impact of$3.1 million of restructuring charges, was$129.1 million .- Gross Margin in Q4 2023 was 60.6%, as compared to 56.5% in the prior year period. Adjusted gross margin in Q4 2023 was 61.4%, up from an adjusted gross margin of 57.9% in the prior year period, primarily driven by actions to reduce the fixed cost base within the Workshops + Digital business.
- Non-Cash Intangible Impairment Charges: During Q4 2023, the Company fully impaired the goodwill and franchise rights acquired balances for past franchise acquisitions in the
Republic of Ireland andNorthern Ireland , resulting in total charges of$3.6 million . - Operating Loss in Q4 2023 was
$6.0 million , compared to operating loss of$51.8 million in the prior year period. Adjusted operating income in Q4 2023, which excluded the net impact of$23.6 million of restructuring charges and non-cash intangible impairment charges of$3.6 million , was$21.3 million . Adjusted operating income in Q4 2022, which excluded the impact of non-cash intangible impairment charges totaling$57.6 million and the net impact of$17.4 million of restructuring charges, was$23.1 million . - Income Tax Expense in Q4 2023 was
$57.6 million , which reflected an increase in the valuation allowance to offset allU.S. deferred tax assets due to the uncertainty of realizing future tax benefits of the assets. In the prior year period, income tax was a benefit of$36.7 million . - Net Loss in Q4 2023 was
$88.1 million compared to net loss of$35.8 million in the prior year period. - Diluted Net Loss per share in Q4 2023 was
$1.11 compared to diluted net loss per share of$0.51 in the prior year period.- Certain items affect year-over-year comparability.
- Q4 2023 diluted net loss per share incorporated the net negative impact of
$1.05 per diluted share in the aggregate due to the following items:$0.78 per diluted share negative tax impact due to an increase in the valuation allowance to offset allU.S. deferred tax assets due to the uncertainty of realizing future tax benefits of the assets.$0.22 per diluted share net negative impact of restructuring charges.$0.05 per diluted share negative impact of non-cash intangible impairment charges for franchise rights acquired and goodwill.
- Q4 2022 diluted net loss per share incorporated the negative impact of
$0.52 per diluted share in the aggregate due to the following items:$0.63 per diluted share negative impact of non-cash intangible impairment charges for franchise rights acquired and goodwill.$0.18 per diluted share net negative impact of restructuring charges.$0.68 per diluted share positive tax impact of a legal entity restructuring that resulted in a reversal of certain deferred tax liabilities.$0.38 per diluted share negative tax impact of establishing a valuation allowance to offset certain deferred tax assets due to the uncertainty of realizing future tax benefits from interest expense carryforwards.
- Q4 2023 diluted net loss per share incorporated the net negative impact of
- Certain items affect year-over-year comparability.
Full Year Fiscal 2023 Consolidated Results
% Change | % Change Adjusted for Constant Currency(1) | ||||||||
Twelve Months Ended | |||||||||
2023 | 2022(7) | ||||||||
(in millions except percentages and per share amounts) | |||||||||
Subscription Revenues, net | $ 822.8 | $ 919.1 | (10.5%) | (10.6%) | |||||
Product Sales and Other, net | 66.8 | 120.8 | (44.7%) | (44.3%) | |||||
Revenues, net | (14.5%) | (14.5%) | |||||||
Gross Profit | (14.8%) | (15.0%) | |||||||
Non-GAAP Adjustments(1) | |||||||||
Net Restructuring Charges(2) | 21.2 | 7.0 | |||||||
Adjusted Gross Profit(1) | (12.4%) | (12.6%) | |||||||
Operating Income (Loss) | ( | 100.0%* | 100.0%* | ||||||
Non-GAAP Adjustments(1) | |||||||||
Franchise Rights Acquired and Goodwill Impairments | 3.6 | 396.7 | |||||||
Net Restructuring Charges(2) | 54.9 | 39.7 | |||||||
Acquisition Transaction Costs | 8.6 | - | |||||||
Adjusted Operating Income(1) | (41.3%) | (42.7%) | |||||||
Net Loss | ( | ( | (56.3%) | (55.8%) | |||||
EPS | ( | ($ 3.65) | (59.9%) | (59.4%) | |||||
Total Paid Weeks | 207.2 | 215.7 | (3.9%) | N/A | |||||
Digital(3) Paid Weeks | 167.9 | 175.8 | (4.5%) | N/A | |||||
Workshops + Digital(4) Paid Weeks | 37.7 | 39.9 | (5.3%) | N/A | |||||
Clinical(5) Paid Weeks | 1.6 | - | N/A | N/A | |||||
End of Period Subscribers(6) | 3.8 | 3.5 | 7.1% | N/A | |||||
Digital Subscribers | 3.1 | 2.8 | 8.6% | N/A | |||||
Workshops + Digital Subscribers | 0.7 | 0.7 | (8.3%) | N/A | |||||
Clinical Subscribers | 0.1 | - | N/A | N/A | |||||
___________________________________ Note: Totals may not sum due to rounding. *Note: Percentage in excess of 100.0% and not meaningful.
| |||||||||
Full Year Fiscal 2023 Business and Financial Highlights
- Total Paid Weeks in fiscal 2023 were down 3.9% versus the prior year, driven by declines in the Digital and Workshops + Digital businesses. Fiscal 2023 Digital Paid Weeks decreased 4.5% versus the prior year. Fiscal 2023 Workshops + Digital Paid Weeks decreased 5.3% versus the prior year. Fiscal 2023 included 1.6 million Clinical Paid Weeks.
- Revenues in fiscal 2023 were
$889.6 million . On a constant currency basis, fiscal 2023 revenues decreased 14.5% versus the prior year.- Subscription Revenues in fiscal 2023 were
$822.8 million . On a constant currency basis, these revenues decreased 10.6% versus the prior year. Subscription Revenues included$30.5 million of Clinical Subscription Revenues. - Product Sales and Other in fiscal 2023 were
$66.8 million . On a constant currency basis, these revenues decreased 44.3% versus the prior year driven by the wind down of the consumer products business.
- Subscription Revenues in fiscal 2023 were
- Gross Profit in fiscal 2023 was
$529.3 million , compared to$621.4 million in the prior year. Adjusted gross profit in fiscal 2023, which excluded the net impact of$21.2 million of restructuring charges, was$550.5 million . Adjusted gross profit in fiscal 2022, which excluded the net impact of$7.0 million of restructuring charges, was$628.4 million .- Gross Margin in fiscal 2023 was 59.5%, as compared to 59.8% in the prior year. Adjusted gross margin in fiscal 2023 was 61.9%, up from an adjusted gross margin of 60.4% in the prior year, primarily driven by actions to reduce the fixed cost base within the Workshops + Digital business.
- Operating Income in fiscal 2023 was
$22.3 million , compared to operating loss of$284.0 million in the prior year. Adjusted operating income in fiscal 2023, which excluded the net impact of$54.9 million of restructuring charges,$8.6 million of acquisition transaction costs, and$3.6 million of non-cash intangible impairment charges was$89.5 million . Adjusted operating income in fiscal 2022, which excluded the impact of non-cash intangible impairment charges totaling$396.7 million and the net impact of$39.7 million of restructuring charges, was$152.5 million . - Income Tax Expense in fiscal 2023 was
$38.6 million , which reflected an increase in the valuation allowance to offset allU.S. deferred tax assets due to the uncertainty of realizing future tax benefits of the assets. In the prior year, income tax was a benefit of$109.9 million . - Net Loss in fiscal 2023 was
$112.3 million compared to net loss of$256.9 million in the prior year. - Diluted Net Loss per share in fiscal 2023 was
$1.46 compared to diluted net loss per share of$3.65 in the prior year.- Certain items affect year-over-year comparability.
- Fiscal 2023 diluted net loss per share incorporated the net negative impact of
$1.34 per diluted share in the aggregate due to the following items:$0.66 per diluted share negative tax impact due to an increase in the valuation allowance to offset allU.S. deferred tax assets due to the uncertainty of realizing future tax benefits of the assets.$0.54 per diluted share net negative impact of restructuring charges.$0.10 per diluted share negative impact from acquisition transaction costs.$0.05 per diluted share negative impact of non-cash intangible impairment charges for franchise rights acquired and goodwill.
- Fiscal 2022 diluted net loss per share incorporated the negative impact of
$4.38 per diluted share in the aggregate due to the following items:$4.28 per diluted share negative impact of non-cash intangible impairment charges for franchise rights acquired and goodwill.$0.42 per diluted share net negative impact of restructuring charges.$0.69 per diluted share positive tax impact of a legal entity restructuring that resulted in a reversal of certain deferred tax liabilities.$0.39 per diluted share negative tax impact of establishing a valuation allowance to offset certain deferred tax assets due to the uncertainty of realizing future tax benefits from interest expense carryforwards.$0.03 per diluted share tax benefit due to out-of-period income tax adjustments.
- Fiscal 2023 diluted net loss per share incorporated the net negative impact of
- Certain items affect year-over-year comparability.
Other Items
- Cash balance as of
December 30, 2023 was$109.4 million . On that same date, the Company had no outstanding borrowings under its revolving credit facility. - 2023 Restructuring Plan: In connection with the previously announced 2023 restructuring plan, the Company recorded aggregate restructuring charges of
$23.1 million in Q4 2023. This is higher than the previously disclosed estimate of up to$10.0 million as the Company continued to centralize and streamline its organization resulting in additional charges. - Reporting Segment Update: As a result of the continued evolution of the Company’s centralized organizational structure in fiscal 2023, and management’s 2024 strategic planning process, the Company’s reporting segments changed commencing with the first day of fiscal 2024 to one segment based on total revenue. This segment reflects the Company’s global management of the business and will present results on a global basis. The Company’s reporting segments in fiscal 2023 were
North America and International.
Full Year Fiscal 2024 Guidance
The Company is providing the following full year fiscal 2024 guidance:
- Revenues are expected to be in the range of
$830.0 million to$860.0 million , reflecting a$55 million year-over-year headwind from the strategic decision to wind down the Company’s low-margin consumer products business. - Operating Income is expected to be in the range of
$100.0 million to$110.0 million . Changes to modernize the Company’s technology organization required the Company to update its capitalized labor rate expectations. Based on these updated expectations, an estimated$9.0 million of expenses that were previously expected to be capitalized will now be reflected on the income statement in 2024. This shift in operating methodology does not impact cash.
Fourth Quarter and Full Year 2023 Conference Call and Webcast
The Company has scheduled a conference call today at
The live webcast of the conference call will be available on the Company’s corporate website, corporate.ww.com, under Events and Presentations. Supplemental investor materials will also be available in the same location prior to the start of the webcast. A replay of the webcast will be available on this site for approximately 90 days.
Statement regarding Non-GAAP Financial Measures
The following provides information regarding non-GAAP financial measures used in this earnings release and today’s scheduled conference call:
To supplement the Company's consolidated results presented in accordance with accounting principles generally accepted in
Management believes these non-GAAP financial measures provide useful supplemental information for its and investors' evaluation of the Company's business performance and are useful for period-over-period comparisons of the performance of the Company's business. While management believes that these non-GAAP financial measures are useful in evaluating the Company's business, this information should be considered as supplemental in nature and should not 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 titled measures reported by other companies. See "Reconciliation of Non-GAAP Financial Measures" attached to this release and reconciliations, if any, included elsewhere in this release for a reconciliation of the non-GAAP financial measures to the most directly comparable GAAP measures.
About
WeightWatchers is a human-centric technology company powered by our proven, science-based, clinically effective weight loss and weight management programs. For six decades, we have inspired millions of people to adopt healthy habits for real life. We combine technology and community to help members reach and sustain their goals on our programs. To learn more about the WeightWatchers approach to healthy living, please visit ww.com. For more information about our global business, visit our corporate website at corporate.ww.com.
This news release and any attachments include “forward-looking statements,” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, including, in particular, any guidance and any statements about the Company’s plans, strategies, objectives, initiatives, roadmap and prospects. The Company generally uses the words “may,” “will,” “could,” “expect,” “anticipate,” “believe,” “estimate,” “plan,” “intend,” “aim” and similar expressions in this news release and any attachments to identify forward-looking statements. The Company bases these forward-looking statements on its current views with respect to future events and financial performance. Actual results could differ materially from those projected in the forward-looking statements. These forward-looking statements are subject to risks, uncertainties and assumptions, including, among other things: competition from other weight management and health and wellness industry participants or the development of more effective or more favorably perceived weight management methods; the Company's failure to continue to retain and grow its subscriber base; the Company’s ability to be a leader in the rapidly evolving and increasingly competitive clinical weight management and weight loss market; the Company's ability to continue to develop new, innovative services and products and enhance its existing services and products or the failure of its services, products or brands to continue to appeal to the market, or its ability to successfully expand into new channels of distribution or respond to consumer trends or sentiment; the ability to successfully implement strategic initiatives; the Company’s ability to evolve its community offerings to meet the evolving tastes and preferences of its members; the effectiveness and efficiency of the Company's advertising and marketing programs, including the strength of the Company's social media presence; the impact on the Company's reputation of actions taken by its franchisees, licensees, suppliers, affiliated provider entities, PCs’ healthcare professionals, and other partners, including as a result of its acquisition of
CONSOLIDATED BALANCE SHEETS AT | ||||||||||
(IN THOUSANDS) | ||||||||||
UNAUDITED | ||||||||||
2023 | 2022 | |||||||||
ASSETS | ||||||||||
CURRENT ASSETS | ||||||||||
Cash and cash equivalents | $ | 109,366 | $ | 178,326 | ||||||
Receivables (net of allowances: | 14,938 | 24,273 | ||||||||
Inventories | 68 | 20,528 | ||||||||
Prepaid income taxes | 25,370 | 19,447 | ||||||||
Prepaid marketing and advertising | 10,149 | 7,927 | ||||||||
Prepaid expenses and other current assets | 19,583 | 30,830 | ||||||||
TOTAL CURRENT ASSETS | 179,474 | 281,331 | ||||||||
Property and equipment, net | 19,741 | 28,229 | ||||||||
Operating lease assets | 52,272 | 75,696 | ||||||||
Franchise rights acquired | 386,526 | 386,745 | ||||||||
243,441 | 155,998 | |||||||||
Other intangible assets, net | 63,208 | 63,306 | ||||||||
Deferred income taxes | 19,683 | 22,246 | ||||||||
Other noncurrent assets | 17,685 | 14,879 | ||||||||
TOTAL ASSETS | $ | 982,030 | $ | 1,028,430 | ||||||
LIABILITIES AND TOTAL DEFICIT | ||||||||||
CURRENT LIABILITIES | ||||||||||
Portion of operating lease liabilities due within one year | $ | 9,613 | $ | 17,955 | ||||||
Accounts payable | 18,507 | 18,890 | ||||||||
Salaries and wages payable | 79,096 | 72,577 | ||||||||
Accrued marketing and advertising | 18,215 | 17,927 | ||||||||
Accrued interest | 5,346 | 5,289 | ||||||||
Deferred acquisition payable | 16,500 | 1,166 | ||||||||
Other accrued liabilities | 22,610 | 28,952 | ||||||||
Income taxes payable | 1,609 | 1,646 | ||||||||
Deferred revenue | 33,966 | 32,156 | ||||||||
TOTAL CURRENT LIABILITIES | 205,462 | 196,558 | ||||||||
Long-term debt, net | 1,426,464 | 1,422,284 | ||||||||
Long-term operating lease liabilities | 53,461 | 68,099 | ||||||||
Deferred income taxes | 41,994 | 25,084 | (1) | |||||||
Other | 15,743 | 2,185 | ||||||||
TOTAL LIABILITIES | 1,743,124 | 1,714,210 | (1) | |||||||
TOTAL DEFICIT | ||||||||||
Common stock, | 0 | 0 | ||||||||
(3,064,628 | ) | (3,097,304 | ) | |||||||
Retained earnings | 2,314,834 | 2,416,994 | (1) | |||||||
Accumulated other comprehensive loss | (11,300 | ) | (5,470 | ) | ||||||
TOTAL DEFICIT | (761,094 | ) | (685,780 | ) | (1) | |||||
TOTAL LIABILITIES AND TOTAL DEFICIT | $ | 982,030 | $ | 1,028,430 | ||||||
(1) Certain amounts have been revised at |
CONSOLIDATED STATEMENTS OF OPERATIONS | |||||||||||
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS) | |||||||||||
UNAUDITED | |||||||||||
Three Months Ended | |||||||||||
2023 | 2022 | ||||||||||
Subscription revenues, net (1) | $ | 196,087 | $ | 200,932 | |||||||
Product sales and other, net (2) | 9,868 | 21,970 | (4) | ||||||||
Revenues, net | 205,955 | 222,902 | (4) | ||||||||
Cost of subscription revenues (3) | 67,707 | 77,817 | |||||||||
Cost of product sales and other | 13,391 | 19,117 | |||||||||
Cost of revenues | 81,098 | 96,934 | |||||||||
Gross profit | 124,857 | 125,968 | (4) | ||||||||
Marketing expenses | 50,920 | 49,660 | |||||||||
Selling, general and administrative expenses | 76,312 | 70,520 | |||||||||
Franchise rights acquired and goodwill impairments | 3,633 | 57,566 | |||||||||
Operating loss | (6,008 | ) | (51,778 | ) | (4) | ||||||
Interest expense | 24,464 | 22,304 | |||||||||
Other expense (income), net | 107 | (1,611 | ) | ||||||||
Loss before income taxes | (30,579 | ) | (72,471 | ) | (4) | ||||||
Provision for (benefit from) income taxes | 57,556 | (36,690 | ) | (4) | |||||||
Net loss | $ | (88,135 | ) | $ | (35,781 | ) | (4) | ||||
Net loss per share | |||||||||||
Basic | $ | (1.11 | ) | $ | (0.51 | ) | (4) | ||||
Diluted | $ | (1.11 | ) | $ | (0.51 | ) | (4) | ||||
Weighted average common shares outstanding | |||||||||||
Basic | 79,125 | 70,509 | |||||||||
Diluted | 79,125 | 70,509 | |||||||||
Note: Totals may not sum due to rounding. | |||||||||||
(1) Consists of net “Digital Subscription Revenues”, net “Workshops + Digital Fees” and net “Clinical Subscription Revenues”. “Digital Subscription Revenues” consist of the fees associated with subscriptions for the Company’s Digital offerings, which formerly included Personal Coaching + Digital and Digital 360 (as applicable). “Workshops + Digital Fees” consist of the fees associated with the Company's subscription plans for combined workshops and digital offerings and other payment arrangements for access to workshops. “Clinical Subscription Revenues” consist of the fees associated with subscriptions for the Company’s Clinical offerings. | |||||||||||
(2) Consists of sales of consumer products via e-commerce, in studios and through the Company's trusted partners, revenues from licensing and publishing, other revenues, and franchise fees with respect to commitment plans and royalties. | |||||||||||
(3) Consists of cost of revenues and operating expenses for the Company's Digital, Workshops + Digital and Clinical services. | |||||||||||
(4) Certain amounts have been revised for the three months ended | |||||||||||
CONSOLIDATED STATEMENTS OF OPERATIONS | |||||||||||
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS) | |||||||||||
UNAUDITED | |||||||||||
Twelve Months Ended | |||||||||||
2023 | 2022 | ||||||||||
Subscription revenues, net (1) | $ | 822,755 | $ | 919,055 | |||||||
Product sales and other, net (2) | 66,796 | 120,780 | (4) | ||||||||
Revenues, net | 889,551 | 1,039,835 | (4) | ||||||||
Cost of subscription revenues (3) | 301,062 | 321,528 | |||||||||
Cost of product sales and other | 59,186 | 96,928 | |||||||||
Cost of revenues | 360,248 | 418,456 | |||||||||
Gross profit | 529,303 | 621,379 | (4) | ||||||||
Marketing expenses | 238,387 | 244,783 | |||||||||
Selling, general and administrative expenses | 264,950 | 263,840 | |||||||||
Franchise rights acquired and goodwill impairments | 3,633 | 396,727 | |||||||||
Operating income (loss) | 22,333 | (283,971 | ) | (4) | |||||||
Interest expense | 95,893 | 81,141 | |||||||||
Other expense, net | 72 | 1,691 | |||||||||
Loss before income taxes | (73,632 | ) | (366,803 | ) | (4) | ||||||
Provision for (benefit from) income taxes | 38,623 | (109,935 | ) | (4) | |||||||
Net loss | $ | (112,255 | ) | $ | (256,868 | ) | (4) | ||||
Net loss per share | |||||||||||
Basic | $ | (1.46 | ) | $ | (3.65 | ) | (4) | ||||
Diluted | $ | (1.46 | ) | $ | (3.65 | ) | (4) | ||||
Weighted average common shares outstanding | |||||||||||
Basic | 76,677 | 70,321 | |||||||||
Diluted | 76,677 | 70,321 | |||||||||
Note: Totals may not sum due to rounding. | |||||||||||
(1) Consists of net “Digital Subscription Revenues”, net “Workshops + Digital Fees” and net “Clinical Subscription Revenues”. “Digital Subscription Revenues” consist of the fees associated with subscriptions for the Company’s Digital offerings, which formerly included Personal Coaching + Digital and Digital 360 (as applicable). “Workshops + Digital Fees” consist of the fees associated with the Company's subscription plans for combined workshops and digital offerings and other payment arrangements for access to workshops. “Clinical Subscription Revenues” consist of the fees associated with subscriptions for the Company’s Clinical offerings. | |||||||||||
(2) Consists of sales of consumer products via e-commerce, in studios and through the Company's trusted partners, revenues from licensing and publishing, other revenues, and franchise fees with respect to commitment plans and royalties. | |||||||||||
(3) Consists of cost of revenues and operating expenses for the Company's Digital, Workshops + Digital and Clinical services. | |||||||||||
(4) Certain amounts have been revised for the twelve months ended | |||||||||||
CONSOLIDATED STATEMENTS OF CASH FLOWS | ||||||||||
(IN THOUSANDS) | ||||||||||
UNAUDITED | ||||||||||
Twelve Months Ended | ||||||||||
2023 | 2022 | |||||||||
Operating activities: | ||||||||||
Net loss | $ | (112,255 | ) | $ | (256,868 | ) | (1) | |||
Adjustments to reconcile net loss to cash provided by operating activities: | ||||||||||
Depreciation and amortization | 52,471 | 43,801 | ||||||||
Amortization of deferred financing costs and debt discount | 5,018 | 5,018 | ||||||||
Impairment of franchise rights acquired and goodwill | 3,633 | 396,727 | ||||||||
Impairment of intangible and long-lived assets | 1,112 | 3,455 | ||||||||
Share-based compensation expense | 15,185 | 12,957 | ||||||||
Deferred tax provision (benefit) | 19,821 | (145,829 | ) | (1) | ||||||
Allowance for doubtful accounts | 1,306 | (460 | ) | |||||||
Reserve for inventory obsolescence | 7,350 | 6,796 | ||||||||
Foreign currency exchange rate loss | 263 | 2,374 | ||||||||
Changes in cash due to: | ||||||||||
Receivables | 17,112 | (7,558 | ) | |||||||
Inventories | 14,018 | 3,733 | ||||||||
Prepaid expenses | (4,133 | ) | 8,878 | (1) | ||||||
Accounts payable | (54 | ) | (2,691 | ) | ||||||
Accrued liabilities | (11,625 | ) | 20,925 | (1) | ||||||
Deferred revenue | 1,273 | (11,733 | ) | |||||||
Other long term assets and liabilities, net | (3,598 | ) | (2,291 | ) | ||||||
Income taxes | (211 | ) | (588 | ) | ||||||
Cash provided by operating activities | 6,686 | 76,646 | ||||||||
Investing activities: | ||||||||||
Capital expenditures | (2,485 | ) | (2,065 | ) | ||||||
Capitalized software and website development expenditures | (33,816 | ) | (36,187 | ) | ||||||
Cash paid for acquisitions, net of cash acquired | (38,362 | ) | (4,350 | ) | ||||||
Other items, net | (33 | ) | (42 | ) | ||||||
Cash used for investing activities | (74,696 | ) | (42,644 | ) | ||||||
Financing activities: | ||||||||||
Taxes paid related to net share settlement of equity awards | (2,241 | ) | (2,197 | ) | ||||||
Proceeds from stock options exercised | 718 | — | ||||||||
Cash paid for acquisitions | (1,178 | ) | (2,413 | ) | ||||||
Other items, net | (48 | ) | (112 | ) | ||||||
Cash used for financing activities | (2,749 | ) | (4,722 | ) | ||||||
Effect of exchange rate changes on cash and cash equivalents | 1,799 | (4,748 | ) | |||||||
Net (decrease) increase in cash and cash equivalents | (68,960 | ) | 24,532 | |||||||
Cash and cash equivalents, beginning of period | 178,326 | 153,794 | ||||||||
Cash and cash equivalents, end of period | $ | 109,366 | $ | 178,326 | ||||||
(1) Certain amounts have been revised for the twelve months ended | ||||||||||
OPERATIONAL STATISTICS | ||||||||
(IN THOUSANDS, EXCEPT PERCENTAGES) | ||||||||
UNAUDITED | ||||||||
Three Months Ended | ||||||||
Variance | ||||||||
2023 | 2022 | |||||||
Digital Paid Weeks (1) | ||||||||
26,124 | 23,714 | 10.2% | ||||||
International | 14,886 | 14,043 | 6.0% | |||||
Total Digital Paid Weeks | 41,010 | 37,757 | 8.6% | |||||
Workshops + Digital Paid Weeks(1) | ||||||||
6,483 | 7,178 | (9.7%) | ||||||
International | 2,220 | 2,407 | (7.8%) | |||||
Total Workshops + Digital Paid Weeks | 8,703 | 9,585 | (9.2%) | |||||
Clinical Paid Weeks (1) | ||||||||
719 | — | N/A | ||||||
International | — | — | — | |||||
Total Clinical Paid Weeks | 719 | — | N/A | |||||
Total Paid Weeks (1) | ||||||||
33,327 | 30,892 | 7.9% | ||||||
International | 17,106 | 16,449 | 4.0% | |||||
Total Paid Weeks | 50,432 | 47,342 | 6.5% | |||||
End of Period Digital Subscribers(2) | ||||||||
1,948 | 1,802 | 8.1% | ||||||
International | 1,131 | 1,033 | 9.5% | |||||
Total End of Period Digital Subscribers | 3,079 | 2,836 | 8.6% | |||||
End of Period Workshops + Digital Subscribers(2) | ||||||||
484 | 534 | (9.4%) | ||||||
International | 167 | 176 | (4.9%) | |||||
Total End of Period Workshops + Digital Subscribers | 652 | 711 | (8.3%) | |||||
End of Period Clinical Subscribers(2) | ||||||||
67 | — | N/A | ||||||
International | — | — | — | |||||
Total End of Period Clinical Subscribers | 67 | — | N/A | |||||
Total End of Period Subscribers(2) | ||||||||
2,499 | 2,337 | 6.9% | ||||||
International | 1,299 | 1,209 | 7.4% | |||||
Total End of Period Subscribers | 3,798 | 3,546 | 7.1% | |||||
Note: Totals may not sum due to rounding. | ||||||||
(1) 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 the Company’s digital subscription products, which formerly included Personal Coaching + Digital and Digital 360 (as applicable); (ii) “Workshops + Digital Paid Weeks” is the sum of total paid commitment plan weeks which include workshops and digital offerings; (iii) “Clinical Paid Weeks” is the total paid subscription weeks for the Company’s Clinical subscription products; and (iv) “Total Paid Weeks” is the sum of Digital Paid Weeks, Workshops + Digital Paid Weeks and Clinical Paid Weeks. | ||||||||
(2) 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 former Personal Coaching + Digital and Digital 360 (as applicable), subscribers; (ii) “End of Period Workshops + Digital Subscribers” is the total number of commitment plan subscribers that have access to combined workshops and digital offerings; (iii) “End of Period Clinical Subscribers” is the total number of Clinical subscribers; and (iv) “End of Period Subscribers” is the sum of End of Period Digital Subscribers, End of Period Workshops + Digital Subscribers and End of Period Clinical Subscribers. | ||||||||
OPERATIONAL STATISTICS | ||||||||
(IN THOUSANDS, EXCEPT PERCENTAGES) | ||||||||
UNAUDITED | ||||||||
Twelve Months Ended | ||||||||
Variance | ||||||||
2023 | 2022 | |||||||
Digital Paid Weeks (1) | ||||||||
107,516 | 111,457 | (3.5%) | ||||||
International | 60,351 | 64,355 | (6.2%) | |||||
Total Digital Paid Weeks | 167,868 | 175,812 | (4.5%) | |||||
Workshops + Digital Paid Weeks(1) | ||||||||
28,397 | 29,902 | (5.0%) | ||||||
International | 9,345 | 9,954 | (6.1%) | |||||
Total Workshops + Digital Paid Weeks | 37,742 | 39,856 | (5.3%) | |||||
Clinical Paid Weeks (1) | ||||||||
1,608 | — | N/A | ||||||
International | — | — | — | |||||
Total Clinical Paid Weeks | 1,608 | — | N/A | |||||
Total Paid Weeks (1) | ||||||||
137,522 | 141,359 | (2.7%) | ||||||
International | 69,697 | 74,309 | (6.2%) | |||||
Total Paid Weeks | 207,218 | 215,668 | (3.9%) | |||||
End of Period Digital Subscribers(2) | ||||||||
1,948 | 1,802 | 8.1% | ||||||
International | 1,131 | 1,033 | 9.5% | |||||
Total End of Period Digital Subscribers | 3,079 | 2,836 | 8.6% | |||||
End of Period Workshops + Digital Subscribers(2) | ||||||||
484 | 534 | (9.4%) | ||||||
International | 167 | 176 | (4.9%) | |||||
Total End of Period Workshops + Digital Subscribers | 652 | 711 | (8.3%) | |||||
End of Period Clinical Subscribers(2) | ||||||||
67 | — | N/A | ||||||
International | — | — | — | |||||
Total End of Period Clinical Subscribers | 67 | — | N/A | |||||
Total End of Period Subscribers(2) | ||||||||
2,499 | 2,337 | 6.9% | ||||||
International | 1,299 | 1,209 | 7.4% | |||||
Total End of Period Subscribers | 3,798 | 3,546 | 7.1% | |||||
Note: Totals may not sum due to rounding. | ||||||||
(1) 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 the Company’s digital subscription products, which formerly included Personal Coaching + Digital and Digital 360 (as applicable); (ii) “Workshops + Digital Paid Weeks” is the sum of total paid commitment plan weeks which include workshops and digital offerings; (iii) “Clinical Paid Weeks” is the total paid subscription weeks for the Company’s Clinical subscription products; and (iv) “Total Paid Weeks” is the sum of Digital Paid Weeks, Workshops + Digital Paid Weeks and Clinical Paid Weeks. | ||||||||
(2) 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 former Personal Coaching + Digital and Digital 360 (as applicable), subscribers; (ii) “End of Period Workshops + Digital Subscribers” is the total number of commitment plan subscribers that have access to combined workshops and digital offerings; (iii) “End of Period Clinical Subscribers” is the total number of Clinical subscribers; and (iv) “End of Period Subscribers” is the sum of End of Period Digital Subscribers, End of Period Workshops + Digital Subscribers and End of Period Clinical Subscribers. | ||||||||
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES | ||||||||||||||||||||
(IN THOUSANDS, EXCEPT PERCENTAGES) | ||||||||||||||||||||
UNAUDITED | ||||||||||||||||||||
Q4 2023 Variance | ||||||||||||||||||||
2023 | ||||||||||||||||||||
Constant | ||||||||||||||||||||
Q4 2023 | Q4 2022 | 2023 | Currency | |||||||||||||||||
Currency | Constant | vs | vs | |||||||||||||||||
GAAP | Adjustment | Currency | GAAP | 2022 | 2022 | |||||||||||||||
Selected Financial Data | ||||||||||||||||||||
Consolidated Company Revenues | $ | 205,955 | $ | (2,434 | ) | $ | 203,521 | $ | 222,902 | (6) | (7.6%) | (8.7%) | ||||||||
Consolidated Digital Subscription Revenues (1) | $ | 133,459 | $ | (1,984 | ) | $ | 131,475 | $ | 141,085 | (5.4%) | (6.8%) | |||||||||
Consolidated Workshops + Digital Fees (2) | $ | 49,666 | $ | (395 | ) | $ | 49,271 | $ | 59,847 | (17.0%) | (17.7%) | |||||||||
Consolidated Clinical Subscription Revenues (3) | $ | 12,962 | $ | — | $ | 12,962 | $ | — | N/A | N/A | ||||||||||
Consolidated Subscription Revenues (4) | $ | 196,087 | $ | (2,379 | ) | $ | 193,708 | $ | 200,932 | (2.4%) | (3.6%) | |||||||||
Consolidated Product Sales and Other (5) | $ | 9,868 | $ | (55 | ) | $ | 9,813 | $ | 21,970 | (6) | (55.1%) | (55.3%) | ||||||||
Digital Subscription Revenues (1) | $ | 88,349 | $ | 16 | $ | 88,365 | $ | 93,659 | (5.7%) | (5.7%) | ||||||||||
Workshops + Digital Fees (2) | $ | 40,415 | $ | 8 | $ | 40,423 | $ | 48,558 | (16.8%) | (16.8%) | ||||||||||
Clinical Subscription Revenues (3) | $ | 12,962 | $ | — | $ | 12,962 | $ | — | N/A | N/A | ||||||||||
Subscription Revenues (4) | $ | 141,726 | $ | 23 | $ | 141,749 | $ | 142,217 | (0.3%) | (0.3%) | ||||||||||
Product Sales and Other (5) | $ | 8,570 | $ | 1 | $ | 8,571 | $ | 15,616 | (6) | (45.1%) | (45.1%) | |||||||||
Total Revenues | $ | 150,296 | $ | 25 | $ | 150,321 | $ | 157,833 | (6) | (4.8%) | (4.8%) | |||||||||
International | ||||||||||||||||||||
Digital Subscription Revenues (1) | $ | 45,110 | $ | (1,999 | ) | $ | 43,111 | $ | 47,426 | (4.9%) | (9.1%) | |||||||||
Workshops + Digital Fees (2) | $ | 9,251 | $ | (403 | ) | $ | 8,848 | $ | 11,289 | (18.1%) | (21.6%) | |||||||||
Clinical Subscription Revenues (3) | $ | — | $ | — | $ | — | $ | — | N/A | N/A | ||||||||||
Subscription Revenues (4) | $ | 54,361 | $ | (2,402 | ) | $ | 51,959 | $ | 58,715 | (7.4%) | (11.5%) | |||||||||
Product Sales and Other (5) | $ | 1,298 | $ | (56 | ) | $ | 1,242 | $ | 6,354 | (79.6%) | (80.5%) | |||||||||
Total Revenues | $ | 55,659 | $ | (2,459 | ) | $ | 53,200 | $ | 65,069 | (14.5%) | (18.2%) | |||||||||
Note: Totals may not sum due to rounding. | ||||||||||||||||||||
(1) “Digital Subscription Revenues” consist of the fees associated with subscriptions for the Company’s Digital offerings, which formerly included Personal Coaching + Digital and Digital 360 (as applicable). | ||||||||||||||||||||
(2) “Workshops + Digital Fees” consist of the fees associated with the Company's subscription plans for combined workshops and digital offerings and other payment arrangements for access to workshops. | ||||||||||||||||||||
(3) “Clinical Subscription Revenues” consist of the fees associated with subscriptions for the Company’s Clinical offerings. | ||||||||||||||||||||
(4) “Subscription Revenues” equal “Digital Subscription Revenues” plus “Workshops + Digital Fees” plus “Clinical Subscription Revenues”. | ||||||||||||||||||||
(5) “Product Sales and Other” are sales of consumer products via e-commerce, in studios and through the Company's trusted partners, revenues from licensing and publishing, other revenues, and, in the case of the consolidated financial results and | ||||||||||||||||||||
(6) Certain amounts have been revised for Q4 2022 to correct immaterial misstatements related to certain matters, which will be more fully described in the Company's Form 10-K filing for the fiscal year ended |
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES | ||||||||||||||||||||
(IN THOUSANDS, EXCEPT PERCENTAGES) | ||||||||||||||||||||
UNAUDITED | ||||||||||||||||||||
Full Year 2023 Variance | ||||||||||||||||||||
2023 | ||||||||||||||||||||
Constant | ||||||||||||||||||||
Full Year 2023 | Full Year 2022 | 2023 | Currency | |||||||||||||||||
Currency | Constant | vs | vs | |||||||||||||||||
GAAP | Adjustment | Currency | GAAP | 2022 | 2022 | |||||||||||||||
Selected Financial Data | ||||||||||||||||||||
Consolidated Company Revenues | $ | 889,551 | $ | (740 | ) | $ | 888,811 | $ | 1,039,835 | (6) | (14.5%) | (14.5%) | ||||||||
Consolidated Digital Subscription Revenues (1) | $ | 571,074 | $ | (1,376 | ) | $ | 569,698 | $ | 662,668 | (13.8%) | (14.0%) | |||||||||
Consolidated Workshops + Digital Fees (2) | $ | 221,139 | $ | 207 | $ | 221,346 | $ | 256,387 | (13.7%) | (13.7%) | ||||||||||
Consolidated Clinical Subscription Revenues (3) | $ | 30,542 | $ | — | $ | 30,542 | $ | — | N/A | N/A | ||||||||||
Consolidated Subscription Revenues (4) | $ | 822,755 | $ | (1,169 | ) | $ | 821,586 | $ | 919,055 | (10.5%) | (10.6%) | |||||||||
Consolidated Product Sales and Other (5) | $ | 66,796 | $ | 429 | $ | 67,225 | $ | 120,780 | (6) | (44.7%) | (44.3%) | |||||||||
Digital Subscription Revenues (1) | $ | 374,004 | $ | 894 | $ | 374,898 | $ | 436,148 | (14.2%) | (14.0%) | ||||||||||
Workshops + Digital Fees (2) | $ | 179,054 | $ | 334 | $ | 179,388 | $ | 204,115 | (12.3%) | (12.1%) | ||||||||||
Clinical Subscription Revenues (3) | $ | 30,542 | $ | — | $ | 30,542 | $ | — | N/A | N/A | ||||||||||
Subscription Revenues (4) | $ | 583,600 | $ | 1,228 | $ | 584,828 | $ | 640,263 | (8.8%) | (8.7%) | ||||||||||
Product Sales and Other (5) | $ | 54,596 | $ | 117 | $ | 54,713 | $ | 87,095 | (6) | (37.3%) | (37.2%) | |||||||||
Total Revenues | $ | 638,196 | $ | 1,345 | $ | 639,541 | $ | 727,358 | (6) | (12.3%) | (12.1%) | |||||||||
International | ||||||||||||||||||||
Digital Subscription Revenues (1) | $ | 197,070 | $ | (2,270 | ) | $ | 194,800 | $ | 226,520 | (13.0%) | (14.0%) | |||||||||
Workshops + Digital Fees (2) | $ | 42,085 | $ | (127 | ) | $ | 41,958 | $ | 52,272 | (19.5%) | (19.7%) | |||||||||
Clinical Subscription Revenues (3) | $ | — | $ | — | $ | — | $ | — | N/A | N/A | ||||||||||
Subscription Revenues (4) | $ | 239,155 | $ | (2,397 | ) | $ | 236,758 | $ | 278,792 | (14.2%) | (15.1%) | |||||||||
Product Sales and Other (5) | $ | 12,200 | $ | 312 | $ | 12,512 | $ | 33,685 | (63.8%) | (62.9%) | ||||||||||
Total Revenues | $ | 251,355 | $ | (2,085 | ) | $ | 249,270 | $ | 312,477 | (19.6%) | (20.2%) | |||||||||
Note: Totals may not sum due to rounding. | ||||||||||||||||||||
(1) “Digital Subscription Revenues” consist of the fees associated with subscriptions for the Company’s Digital offerings, which formerly included Personal Coaching + Digital and Digital 360 (as applicable). | ||||||||||||||||||||
(2) “Workshops + Digital Fees” consist of the fees associated with the Company's subscription plans for combined workshops and digital offerings and other payment arrangements for access to workshops. | ||||||||||||||||||||
(3) “Clinical Subscription Revenues” consist of the fees associated with subscriptions for the Company’s Clinical offerings. | ||||||||||||||||||||
(4) “Subscription Revenues” equal “Digital Subscription Revenues” plus “Workshops + Digital Fees” plus “Clinical Subscription Revenues”. | ||||||||||||||||||||
(5) “Product Sales and Other” are sales of consumer products via e-commerce, in studios and through the Company's trusted partners, revenues from licensing and publishing, other revenues, and, in the case of the consolidated financial results and | ||||||||||||||||||||
(6) Certain amounts have been revised for full year 2022 to correct immaterial misstatements related to certain matters, which will be more fully described in the Company's Form 10-K filing for the fiscal year ended |
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES | ||||||||||||||||||||||||||||||||||||
(IN THOUSANDS, EXCEPT PERCENTAGES) | ||||||||||||||||||||||||||||||||||||
UNAUDITED | ||||||||||||||||||||||||||||||||||||
Q4 2023 Variance | ||||||||||||||||||||||||||||||||||||
2023 Constant Currency | ||||||||||||||||||||||||||||||||||||
2023 | 2023 | |||||||||||||||||||||||||||||||||||
Q4 2023 | Q4 2022 | Adjusted | Adjusted | |||||||||||||||||||||||||||||||||
Adjusted | 2023 | vs | 2023 | vs | ||||||||||||||||||||||||||||||||
Currency | Constant | Constant | vs | 2022 | vs | 2022 | ||||||||||||||||||||||||||||||
GAAP | Adjustment | Adjusted | Adjustment | Currency | Currency | GAAP | Adjustment | Adjusted | 2022 | Adjusted | 2022 | Adjusted | ||||||||||||||||||||||||
Selected Financial Data | ||||||||||||||||||||||||||||||||||||
Gross Profit | $ | 124,857 | $ | 1,512 | (1) | $ | 126,369 | $ | (1,922) | $ | 122,935 | $ | 124,447 | $ | 125,968 | (5) | $ | 3,128 | (6) | $ | 129,096 | (5) | (0.9%) | (2.1%) | (2.4%) | (3.6%) | ||||||||||
Gross Margin | 60.6% | 61.4% | 60.4% | 61.1% | 56.5% | (5) | 57.9% | (5) | ||||||||||||||||||||||||||||
Selling, General and Administrative Expenses | $ | 76,312 | $ | (22,117) | (2) | $ | 54,195 | $ | (402) | $ | 75,910 | $ | 53,793 | $ | 70,520 | $ | (14,223) | (7) | $ | 56,297 | 8.2% | (3.7%) | 7.6% | (4.4%) | ||||||||||||
Operating (Loss) Income | $ | (6,008) | $ | 27,262 | (3) | $ | 21,254 | $ | (857) | $ | (6,865) | $ | 20,276 | (4) | $ | (51,778) | (5) | $ | 74,918 | (8) | $ | 23,140 | (5) | (88.4%) | (8.1%) | (86.7%) | (12.4%) | |||||||||
Operating Income (Loss) Margin | (2.9%) | 10.3% | (3.4%) | 10.0% | (23.2%) | (5) | 10.4% | (5) | ||||||||||||||||||||||||||||
Note: Totals may not sum due to rounding. | ||||||||||||||||||||||||||||||||||||
(1) Excludes the net impact of | ||||||||||||||||||||||||||||||||||||
(2) Excludes the net impact of | ||||||||||||||||||||||||||||||||||||
(3) Excludes (i) the net impact of (y) | ||||||||||||||||||||||||||||||||||||
(4) Includes | ||||||||||||||||||||||||||||||||||||
(5) Certain amounts have been revised for Q4 2022 to correct immaterial misstatements related to certain matters, which will be more fully described in the Company's Form 10-K filing for the fiscal year ended | ||||||||||||||||||||||||||||||||||||
(6) Excludes the net impact of | ||||||||||||||||||||||||||||||||||||
(7) Excludes the net impact of | ||||||||||||||||||||||||||||||||||||
(8) Excludes (i) the impact of impairment charges of the Company's franchise rights acquired of | ||||||||||||||||||||||||||||||||||||
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES | |||||||||||||||||||||||||||||||||||||||||||||||||
(IN THOUSANDS, EXCEPT PERCENTAGES) | |||||||||||||||||||||||||||||||||||||||||||||||||
UNAUDITED | |||||||||||||||||||||||||||||||||||||||||||||||||
Full Year 2023 Variance | |||||||||||||||||||||||||||||||||||||||||||||||||
2023 Constant Currency | |||||||||||||||||||||||||||||||||||||||||||||||||
2023 | 2023 | ||||||||||||||||||||||||||||||||||||||||||||||||
Full Year 2023 | Full Year 2022 | Adjusted | Adjusted | ||||||||||||||||||||||||||||||||||||||||||||||
Adjusted | 2023 | vs | 2023 | vs | |||||||||||||||||||||||||||||||||||||||||||||
Currency | Constant | Constant | vs | 2022 | vs | 2022 | |||||||||||||||||||||||||||||||||||||||||||
GAAP | Adjustment | Adjusted | Adjustment | Currency | Currency | GAAP | Adjustment | Adjusted | 2022 | Adjusted | 2022 | Adjusted | |||||||||||||||||||||||||||||||||||||
Selected Financial Data | |||||||||||||||||||||||||||||||||||||||||||||||||
Gross Profit | $ | 529,303 | $ | 21,187 | (1) | $ | 550,490 | $ | (1,367 | ) | $ | 527,936 | $ | 549,123 | $ | 621,379 | (5) | $ | 6,981 | (6) | $ | 628,360 | (5) | (14.8%) | (12.4%) | (15.0%) | (12.6%) | ||||||||||||||||||||||
Gross Margin | 59.5% | 61.9% | 59.4% | 61.8% | 59.8% | 60.4% | (5) | ||||||||||||||||||||||||||||||||||||||||||
Selling, General and Administrative Expenses | $ | 264,950 | $ | (42,332 | ) | (2) | $ | 222,618 | $ | (26 | ) | $ | 264,924 | $ | 222,593 | $ | 263,840 | $ | (32,730 | ) | (7) | $ | 231,110 | 0.4% | (3.7%) | 0.4% | (3.7%) | ||||||||||||||||||||||
Operating Income (Loss) | $ | 22,333 | $ | 67,152 | (3) | $ | 89,485 | $ | (1,999 | ) | $ | 20,334 | $ | 87,365 | (4) | $ | (283,971 | ) | (5) | $ | 436,438 | (8) | $ | 152,467 | (5) | (107.9%) | (41.3%) | (107.2%) | (42.7%) | ||||||||||||||||||||
Operating Income (Loss) Margin | 2.5% | 10.1% | 2.3% | 9.8% | (27.3%) | (5) | 14.7% | ||||||||||||||||||||||||||||||||||||||||||
Note: Totals may not sum due to rounding. | |||||||||||||||||||||||||||||||||||||||||||||||||
(1) Excludes the net impact of | |||||||||||||||||||||||||||||||||||||||||||||||||
(2) Excludes (i) the net impact of | |||||||||||||||||||||||||||||||||||||||||||||||||
(3) Excludes (i) the net impact of (w) | |||||||||||||||||||||||||||||||||||||||||||||||||
(4) Includes | |||||||||||||||||||||||||||||||||||||||||||||||||
(5) Certain amounts have been revised for full year 2022 to correct immaterial misstatements related to certain matters, which will be more fully described in the Company's Form 10-K filing for the fiscal year ended | |||||||||||||||||||||||||||||||||||||||||||||||||
(6) Excludes the net impact of | |||||||||||||||||||||||||||||||||||||||||||||||||
(7) Excludes the net impact of | |||||||||||||||||||||||||||||||||||||||||||||||||
(8) Excludes (i) the impact of impairment charges of the Company's franchise rights acquired of | |||||||||||||||||||||||||||||||||||||||||||||||||
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES | ||||||||||||||||||
(IN THOUSANDS) | ||||||||||||||||||
UNAUDITED | ||||||||||||||||||
Three Months Ended | Twelve Months Ended | |||||||||||||||||
2023 | 2022 | 2023 | 2022 | |||||||||||||||
Net Loss | $ | (88,135) | $ | (35,781) | (1) | $ | (112,255) | $ | (256,868) | (1) | ||||||||
Interest | 24,464 | 22,304 | 95,893 | 81,141 | ||||||||||||||
Taxes | 57,556 | (36,690) | (1) | 38,623 | (109,935) | (1) | ||||||||||||
Depreciation and Amortization | 10,007 | 10,407 | 45,640 | 42,348 | ||||||||||||||
Stock-based Compensation | 2,346 | 2,590 | 11,303 | 12,952 | ||||||||||||||
EBITDAS | $ | 6,238 | $ | (37,170) | (1) | $ | 79,204 | $ | (230,362) | (1) | ||||||||
2023 Plan Restructuring Charges (2) | 23,140 | 13,608 | 53,743 | 13,608 | ||||||||||||||
2022 Plan Restructuring Charges (3) | 489 | 4,507 | 1,135 | 27,181 | ||||||||||||||
2021 Plan Restructuring Charges (4) | — | (142) | 57 | (341) | ||||||||||||||
2020 Plan Restructuring Charges (5) | — | (621) | (21) | (737) | ||||||||||||||
Acquisition Transaction Costs (6) | — | — | 8,605 | — | ||||||||||||||
Franchise Rights Acquired and Goodwill Impairments | 3,633 | (7) | 57,566 | (8) | 3,633 | (7) | 396,727 | (9) | ||||||||||
Adjusted EBITDAS | $ | 33,500 | $ | 37,748 | (1) | $ | 146,356 | $ | 206,076 | (1) | ||||||||
Note: Totals may not sum due to rounding. | ||||||||||||||||||
(1) Certain amounts have been revised for the three and twelve months ended | ||||||||||||||||||
(2) Charges associated with the Company's previously disclosed 2023 restructuring plan. | ||||||||||||||||||
(3) Charges associated with the Company's previously disclosed 2022 restructuring plan. | ||||||||||||||||||
(4) The reversal of charges or charges, as applicable, associated with the Company's previously disclosed 2021 organizational restructuring plan. | ||||||||||||||||||
(5) The reversal of charges associated with the Company's previously disclosed 2020 organizational restructuring plan. | ||||||||||||||||||
(6) Certain non-recurring transaction costs in connection with the Company's acquisition of Sequence. | ||||||||||||||||||
(7) Impairment charges of the Company's goodwill of | ||||||||||||||||||
(8) Impairment charges of the Company's franchise rights acquired of | ||||||||||||||||||
(9) Impairment charges of the Company's franchise rights acquired of | ||||||||||||||||||
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES | |||||||||||||||||||||||
(IN THOUSANDS, EXCEPT RATIOS) | |||||||||||||||||||||||
UNAUDITED | |||||||||||||||||||||||
Trailing Twelve | |||||||||||||||||||||||
Q1 2023 | Q2 2023 | Q3 2023 | Q4 2023 | Months | |||||||||||||||||||
Net Debt to Adjusted EBITDAS | |||||||||||||||||||||||
Net (Loss) Income | $ | (118,679 | ) | $ | 50,828 | $ | 43,731 | $ | (88,135 | ) | $ | (112,255 | ) | ||||||||||
Interest | 22,846 | 24,075 | 24,508 | 24,464 | 95,893 | ||||||||||||||||||
Taxes | 67,580 | (48,066 | ) | (38,447 | ) | 57,556 | 38,623 | ||||||||||||||||
Depreciation and Amortization | 10,273 | 11,932 | 13,428 | 10,007 | 45,640 | ||||||||||||||||||
Stock-based Compensation | 2,669 | 3,063 | 3,225 | 2,346 | 11,303 | ||||||||||||||||||
EBITDAS | $ | (15,311 | ) | $ | 41,832 | $ | 46,445 | $ | 6,238 | $ | 79,204 | ||||||||||||
2023 Plan Restructuring Charges (1) | 22,632 | 1,784 | 6,187 | 23,140 | 53,743 | ||||||||||||||||||
2022 Plan Restructuring Charges (2) | 40 | 818 | (212 | ) | 489 | 1,135 | |||||||||||||||||
2021 Plan Restructuring Charges (3) | (7 | ) | 64 | — | — | 57 | |||||||||||||||||
2020 Plan Restructuring Charges (4) | (5 | ) | (16 | ) | — | — | (21 | ) | |||||||||||||||
Acquisition Transaction Costs (5) | 3,719 | 4,886 | — | — | 8,605 | ||||||||||||||||||
Franchise Rights Acquired and Goodwill Impairments (6) | — | — | — | 3,633 | 3,633 | ||||||||||||||||||
Adjusted EBITDAS | $ | 11,068 | $ | 49,368 | $ | 52,420 | $ | 33,500 | $ | 146,356 | |||||||||||||
Total Debt | $ | 1,426,464 | |||||||||||||||||||||
Less: Cash | 109,366 | ||||||||||||||||||||||
Net Debt | $ | 1,317,098 | |||||||||||||||||||||
Total Debt to Net Loss | (12.7 | ) | X | ||||||||||||||||||||
Net Debt to Adjusted EBITDAS | 9.0 | X | |||||||||||||||||||||
Note: Totals may not sum due to rounding. | |||||||||||||||||||||||
(1) Charges associated with the Company's previously disclosed 2023 restructuring plan. | |||||||||||||||||||||||
(2) Charges or the reversal of charges, as applicable, associated with the Company's previously disclosed 2022 restructuring plan. | |||||||||||||||||||||||
(3) The reversal of charges or charges, as applicable, associated with the Company's previously disclosed 2021 organizational restructuring plan. | |||||||||||||||||||||||
(4) The reversal of charges associated with the Company's previously disclosed 2020 organizational restructuring plan. | |||||||||||||||||||||||
(5) Certain non-recurring transaction costs in connection with the Company's acquisition of Sequence, which includes | |||||||||||||||||||||||
(6) Impairment charges of the Company's goodwill of | |||||||||||||||||||||||
For more information, contact:
Investors:
corey.kinger@ww.com
Media:
kelsey.merkel@ww.com
Source:
2024 GlobeNewswire, Inc., source