EX-99.1 2 a05-8766_2ex99d1.htm EX-99.1

 

Exhibit 99.1

 

 

Contact Information:

 

Weight Watchers International, Inc.

 

Brainerd Communicators, Inc.

John Sweeney, CFA

 

Corey Kinger

Director of Investor Relations / Financial Analysis

 

(212) 986-6667

(516) 390-1526

 

 

 

 

WEIGHT WATCHERS ANNOUNCES FIRST QUARTER 2005 RESULTS

 

WOODBURY, N.Y., May 5, 2005 – Weight Watchers International, Inc. (NYSE: WTW) today announced results for the first quarter ended April 2, 2005.

 

Weight Watchers International, Inc., Consolidated

 

For the first quarter of 2005, net revenues increased 17.3% to $330.0 million. Net income was $51.6 million, up from $36.8 million in the first quarter of 2004.  Fully-diluted earnings per share were $0.49 versus $0.34 in the prior year period.

 

Included in this quarter’s consolidated financials are results of WeightWatchers.com, Inc. our affiliate and licensee, as required by our adoption at the end of the first quarter of 2004 of FASB’s Interpretation, FIN 46R, Consolidation of Variable Interest Entities.  Accordingly, we are providing financial results both on a consolidated basis and excluding the impact of the consolidation of WeightWatchers.com, Inc.

 

Weight Watchers International, Inc., Results Excluding FIN 46R Impact of Consolidation

 

On a stand-alone basis, Weight Watchers International, Inc.’s revenues for the first quarter of 2005 were $306.4 million, up 8.9% from $281.4 million in the first quarter of 2004.  Net income was $55.0 million, compared to $48.7 million in the prior year period.  Fully-diluted earnings per share increased to $0.53 in first quarter of 2005 compared to $0.45 for the first quarter 2004.  The first quarter of 2005 benefited $0.03 from an unscheduled debt payment from WeightWatchers.com, Inc. and the first quarter of 2004 included a $0.02 charge related to the early extinguishment of debt.

 

Commenting on the Company’s results, President and Chief Executive Officer, Linda Huett said, “Overall, I am pleased with our first quarter results and believe that they signal the return of this Company to its more traditional growth trajectory.”

 

For Fiscal 2005, the Company now expects to earn between $1.88 and $1.98 per fully diluted share, excluding the impact of FIN 46R.  This guidance includes the $0.03 benefit received in the first quarter relating to the unscheduled debt payment from WeightWatchers.com, Inc., which was not included in previous guidance.

 


 

First Quarter Conference Call

The Company has scheduled a conference call today at 5:00 p.m. EDT.  During the conference call, Linda A. Huett, President and CEO, and Ann M. Sardini, CFO, will discuss first quarter results and answer questions from the investment community. Live audio of the conference call will be webcast at http://www.weightwatchersinternational.com.

 

About Weight Watchers International, Inc.

Weight Watchers International, Inc. is the world’s leading provider of weight loss services, operating in 30 countries through a network of company-owned and franchise operations. Weight Watchers holds over 46,000 weekly meetings where members receive group support and education about healthy eating patterns, behavior modification and physical activity. In addition, Weight Watchers offers a wide range of products, publications and programs for those interested in weight loss and weight control.

 

This news release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are based on management’s current expectations and beliefs, as well as a number of assumptions concerning future events. These statements are subject to risks, uncertainties, assumptions and other important factors. Readers are cautioned not to put undue reliance on such forward-looking statements because actual results may vary materially from those expressed or implied. The reports filed by the company pursuant to United States securities laws contain discussions of these risks and uncertainties. Weight Watchers International assumes no obligation to, and expressly disclaims any obligation to, update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. Readers are advised to review our filings with the United States Securities and Exchange Commission (which are available from the SEC’s EDGAR database at http://www.sec.gov, at various SEC reference facilities in the United States and via the company’s website at http://www.weightwatchersinternational.com).

 

###

 


 

WEIGHT WATCHERS INTERNATIONAL, INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

(IN MILLIONS)

 

 

 

April 2,
2005

 

January 1,
2005

 

 

 

 

 

 

 

ASSETS

 

 

 

 

 

Current assets

 

$

135.3

 

$

125.8

 

Property and equipment, net

 

16.5

 

17.5

 

Goodwill, franchise rights and other intangible assets, net

 

587.8

 

588.0

 

Deferred income taxes

 

75.4

 

78.0

 

Deferred financing costs, other

 

6.5

 

6.9

 

TOTAL ASSETS

 

$

821.5

 

$

816.2

 

 

 

 

 

 

 

LIABILITIES AND SHAREHOLDERS’ EQUITY

 

 

 

 

 

Current liabilities

 

$

183.5

 

$

152.7

 

Long-term debt

 

388.4

 

466.1

 

Other

 

0.8

 

1.0

 

 

 

 

 

 

 

TOTAL LIABILITIES

 

572.7

 

619.8

 

 

 

 

 

 

 

Shareholders’ equity

 

248.8

 

196.4

 

 

 

 

 

 

 

TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY

 

$

821.5

 

$

816.2

 

 


 

WEIGHT WATCHERS INTERNATIONAL, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS

(IN MILLIONS, EXCEPT PER SHARE AMOUNTS)

 

 

 

Three Months Ended April 2, 2005

 

Three Months Ended April 3, 2004

 

 

 

Consolidated
Results

 

Less
Impact of
FIN 46R

 

WWI
Stand
Alone

 

Consolidated
Results

 

Less
Impact of
FIN 46R

 

WWI
Stand
Alone

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Revenues, net

 

$

330.0

 

$

23.6

 

$

306.4

 

$

281.4

 

$

—

 

$

281.4

 

Cost of revenues

 

148.1

 

6.9

 

141.2

 

131.0

 

—

 

131.0

 

Gross profit

 

181.9

 

16.7

 

165.2

 

150.4

 

—

 

150.4

 

Marketing expenses

 

61.1

 

7.7

 

53.4

 

46.5

 

—

 

46.5

 

Selling, general and administrative expenses

 

30.8

 

3.8

 

27.0

 

21.7

 

—

 

21.7

 

Operating income

 

90.0

 

5.2

 

84.8

 

82.2

 

—

 

82.2

 

Interest expense, net

 

4.7

 

0.5

 

4.2

 

4.4

 

—

 

4.4

 

Other (income) / expense, net

 

0.6

 

9.9

 

(9.3

)

(3.8

)

—

 

(3.8

)

Early extinguishment of debt

 

—

 

—

 

—

 

3.3

 

—

 

3.3

 

Income before income taxes and cumulative effect of accounting change

 

84.7

 

(5.2

)

89.9

 

78.3

 

—

 

78.3

 

Provision for income taxes

 

33.1

 

(1.8

)

34.9

 

29.6

 

—

 

29.6

 

Income before cumulative effect of accounting change

 

51.6

 

(3.4

)

55.0

 

48.7

 

—

 

48.7

 

Cumulative effect of accounting change

 

—

 

—

 

—

 

(11.9

)

(11.9

)

—

 

Net income

 

$

51.6

 

$

(3.4

)

$

55.0

 

$

36.8

 

$

(11.9

)

$

48.7

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic Earnings Per Share:

 

 

 

 

 

 

 

 

 

 

 

 

 

Income before cumulative effect of accounting change

 

$

0.50

 

$

(0.04

)

$

0.54

 

$

0.46

 

$

—

 

$

0.46

 

Cumulative effect of accounting change

 

—

 

—

 

—

 

(0.11

)

(0.11

)

—

 

Net income

 

$

0.50

 

$

(0.04

)

$

0.54

 

$

0.35

 

$

(0.11

)

$

0.46

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Diluted Earnings Per Share:

 

 

 

 

 

 

 

 

 

 

 

 

 

Income before cumulative effect of accounting change

 

$

0.49

 

$

(0.04

)

$

0.53

 

$

0.45

 

$

—

 

$

0.45

 

Cumulative effect of accounting change

 

—

 

—

 

—

 

(0.11

)

(0.11

)

—

 

Net income

 

$

0.49

 

$

(0.04

)

$

0.53

 

$

0.34

 

$

(0.11

)

$

0.45

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted average common shares outstanding:

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

102.7

 

102.7

 

102.7

 

106.0

 

106.0

 

106.0

 

Diluted

 

104.6

 

104.6

 

104.6

 

108.6

 

108.6

 

108.6

 

 


 

WEIGHT WATCHERS INTERNATIONAL, INC. AND SUBSIDIARIES

OPERATIONAL STATISTICS

(IN MILLIONS)

 

 

 

Three Months Ended

 

 

 

Apr 2, 2005

 

Apr 3, 2004

 

 

 

 

 

 

 

Attendance

 

 

 

 

 

North America

 

9.8

 

9.9

 

International

 

8.2

 

8.0

 

Total Attendance

 

17.9

 

18.0

 

 

 

 

 

 

 

Supplemental Attendance Detail

 

 

 

 

 

UK

 

4.0

 

3.8

 

CE

 

3.2

 

3.2

 

Other

 

0.9

 

1.0

 

Total International Attendance

 

8.2

 

8.0

 

 

 

 

 

 

 

North America

 

 

 

 

 

Meeting Fees

 

115.4

 

107.2

 

Product Sales

 

44.0

 

41.7

 

Total

 

159.4

 

148.9

 

 

 

 

 

 

 

International

 

 

 

 

 

Meeting fees

 

79.8

 

73.3

 

Product Sales

 

45.8

 

44.7

 

Total

 

125.6

 

118.0

 

 

 

 

 

 

 

Total WWI Sales

 

 

 

 

 

Meeting Fees

 

195.1

 

180.5

 

Product Sales

 

89.9

 

86.4

 

Domestic Franchise Commissions

 

3.8

 

4.2

 

Foreign Franchise Commissions

 

2.1

 

1.9

 

All Other

 

15.4

 

8.3

 

Total WWI Sales

 

306.4

 

281.4

 

 

 

Note: Totals may not sum due to rounding.