GNC's Q3 takes a beating from storms
GNC Holdings reported declines in revenue and income for the third quarter as a series of hurricanes took a toll on its stores in several states.
Net income totaled $21.5 million for the period ended September 30, down from $32.4 million in the year-ago period. GNC's adjusted earnings per share of 32 cents missed Street estimates by one cent.
Revenue totaled $609.5 million, down from $628 million a year ago. Same-store sales rose 1.3% at domestic company-owned stores, and fell 1.7% at domestic franchise locations.
Transactions increased 12.4%. GNC reported it now has 9.6 million members in its loyalty program GNC continues to expand into e-commerce and recently launched a storefront on Amazon.com. At the end of the quarter, GNC had 3,468 corporate stores in the U.S. and Canada and 1,126 domestic franchise locations.
"GNC made good progress in the third quarter, returning to positive same-store sales," said Ken Martindale, who took the reins of GNC as CEO in September. "Transactions, the e-commerce business and enrollment in our new loyalty programs continued to improve, and it is clear that our strengthened model is creating a solid foundation for growth. This year, the team laid a strong foundation for us to build upon."
On the company's quarterly earnings call, CFO Tricia Toliver said that Hurricanes Harvey, Irma and Maria impacted GNC's stores in Texas, Florida and Puerto Rico, with many of its locations in Puerto Rico still closed and not likely to open in the next few months. (The impact of the three hurricanes are estimated to have resulted in a $0.02 reduction to Adjusted EPS in the quarter.)
Other factors impacting the chain's third quarter performance was a reduction in its advertising spend and customers’ redemption of accumulated reward points, Toliver said.
As of Sept. 30, GNC had approximately 9,000 locations, of which approximately 6,800 retail locations are in the United States (including approximately 2,400 Rite Aid franchise store-within-a-store locations) and franchise operations in approximately 50 countries.
Net income totaled $21.5 million for the period ended September 30, down from $32.4 million in the year-ago period. GNC's adjusted earnings per share of 32 cents missed Street estimates by one cent.
Revenue totaled $609.5 million, down from $628 million a year ago. Same-store sales rose 1.3% at domestic company-owned stores, and fell 1.7% at domestic franchise locations.
Transactions increased 12.4%. GNC reported it now has 9.6 million members in its loyalty program GNC continues to expand into e-commerce and recently launched a storefront on Amazon.com. At the end of the quarter, GNC had 3,468 corporate stores in the U.S. and Canada and 1,126 domestic franchise locations.
"GNC made good progress in the third quarter, returning to positive same-store sales," said Ken Martindale, who took the reins of GNC as CEO in September. "Transactions, the e-commerce business and enrollment in our new loyalty programs continued to improve, and it is clear that our strengthened model is creating a solid foundation for growth. This year, the team laid a strong foundation for us to build upon."
On the company's quarterly earnings call, CFO Tricia Toliver said that Hurricanes Harvey, Irma and Maria impacted GNC's stores in Texas, Florida and Puerto Rico, with many of its locations in Puerto Rico still closed and not likely to open in the next few months. (The impact of the three hurricanes are estimated to have resulted in a $0.02 reduction to Adjusted EPS in the quarter.)
Other factors impacting the chain's third quarter performance was a reduction in its advertising spend and customers’ redemption of accumulated reward points, Toliver said.
As of Sept. 30, GNC had approximately 9,000 locations, of which approximately 6,800 retail locations are in the United States (including approximately 2,400 Rite Aid franchise store-within-a-store locations) and franchise operations in approximately 50 countries.