GNC beats Street in Q2
GNC Holdings’ digital and international businesses helped the company top analyst estimates in the second quarter.
Revenue for the second quarter, ended June 30, was $617.9 million compared with $650.2 million in the second quarter of 2017. The sale of Lucky Vitamin on September 30, 2017 resulted in a $22.6 million reduction to revenue. However, earnings per share were 20 cents, beating analysts’ expectations of 15 cents.
By segment, revenues in the U.S. and Canada decreased $10.5 million, or 2.0%, to $517.3 million compared with $527.8 million in the same quarter in 2017. E-commerce sales were 8.3% of U.S. and Canada revenue, an increase of 2.8% over the prior year quarter, and 1.2% over the first quarter of 2018.
Revenues for the company’s international segment increased $4.8 million, or 11.0%, to $48.6 million in the current quarter compared with $43.8 million in the prior year quarter. This was primarily due to an increase in China e-commerce sales of $3.7 million, and an increase in sales to international franchisees of $0.9 million.
Net income was $13.3 million, compared with $16.6 million in the same quarter last year.
Same-store sales decreased 0.4% in domestic company-owned stores, including GNC.com. In domestic franchise locations, same store sales decreased 4.0%.
Company-owned net store closures contributed an approximate $9 million decrease compared with the prior year quarter, while domestic franchise revenue declined $8.2 million due to a decrease in retail same-store sales, as well as a reduction in the number of franchise stores.
Loyalty membership increased 14.3% in the current quarter, compared to March 31. The program now has 14.6 million members, including over 1.0 million members enrolled in Pro Access, an 8.8% increase from March 31.
"During the second quarter of 2018, although we experienced some softness in our U.S. brick-and-mortar business, we delivered meaningful growth in our e-commerce and international businesses consistent with our long-term growth initiatives" said Ken Martindale, GNC Holdings’ CEO. "Our focus remains building on the fundamental strengths of GNC through product and service innovation, effectiveness of our loyalty programs, leveraging the strength of the GNC brand and delivering an integrated customer experience."
Revenue for the second quarter, ended June 30, was $617.9 million compared with $650.2 million in the second quarter of 2017. The sale of Lucky Vitamin on September 30, 2017 resulted in a $22.6 million reduction to revenue. However, earnings per share were 20 cents, beating analysts’ expectations of 15 cents.
By segment, revenues in the U.S. and Canada decreased $10.5 million, or 2.0%, to $517.3 million compared with $527.8 million in the same quarter in 2017. E-commerce sales were 8.3% of U.S. and Canada revenue, an increase of 2.8% over the prior year quarter, and 1.2% over the first quarter of 2018.
Revenues for the company’s international segment increased $4.8 million, or 11.0%, to $48.6 million in the current quarter compared with $43.8 million in the prior year quarter. This was primarily due to an increase in China e-commerce sales of $3.7 million, and an increase in sales to international franchisees of $0.9 million.
Net income was $13.3 million, compared with $16.6 million in the same quarter last year.
Same-store sales decreased 0.4% in domestic company-owned stores, including GNC.com. In domestic franchise locations, same store sales decreased 4.0%.
Company-owned net store closures contributed an approximate $9 million decrease compared with the prior year quarter, while domestic franchise revenue declined $8.2 million due to a decrease in retail same-store sales, as well as a reduction in the number of franchise stores.
Loyalty membership increased 14.3% in the current quarter, compared to March 31. The program now has 14.6 million members, including over 1.0 million members enrolled in Pro Access, an 8.8% increase from March 31.
"During the second quarter of 2018, although we experienced some softness in our U.S. brick-and-mortar business, we delivered meaningful growth in our e-commerce and international businesses consistent with our long-term growth initiatives" said Ken Martindale, GNC Holdings’ CEO. "Our focus remains building on the fundamental strengths of GNC through product and service innovation, effectiveness of our loyalty programs, leveraging the strength of the GNC brand and delivering an integrated customer experience."