WTW
$45.95
Weight Watchers International
($.90)
(1.92%)
Earnings Details
3rd Quarter September 2017
Monday, November 6, 2017 4:15:00 PM
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Summary

Weight Watchers International Beats

Weight Watchers International (WTW) reported 3rd Quarter September 2017 earnings of $0.68 per share on revenue of $323.7 million. The consensus earnings estimate was $0.51 per share on revenue of $315.8 million. The Earnings Whisper number was $0.51 per share. Revenue grew 15.3% on a year-over-year basis.

The company said it expects 2017 earnings of $1.77 to $1.83 per share. The company's previous guidance was earnings of $1.57 to $1.67 per share and the current consensus earnings estimate is $1.45 per share for the year ending December 31, 2017.

Weight Watchers International Inc is a provider of weight management services. The Company operates through a network of Company-owned and franchise operations. The Company' products include Weight Watchers Online and Weight Watchers eTools.

Results
Reported Earnings
$0.68
Earnings Whisper
$0.51
Consensus Estimate
$0.51
Reported Revenue
$323.7 Mil
Revenue Estimate
$315.8 Mil
Growth
Earnings Growth
Revenue Growth
Power Rating
Grade
Earnings Release

Weight Watchers Announces Third Quarter 2017 Results and Raises Full Year 2017 Guidance

Weight Watchers International, Inc. (WTW) today announced its results for the third quarter of fiscal 2017 and raised its full year fiscal 2017 earnings guidance.

"Weight Watchers delivered strong performance across all major geographies in the third quarter, which resulted in high-quality earnings results," said Mindy Grossman, the Company’s President and CEO. "We are excited about the upcoming winter season and the launch of our new program, which has received highly positive and enthusiastic feedback in consumer trials. We have a tremendous opportunity to continue to evolve Weight Watchers into a global, healthy living brand."

"Our solid financial performance continued with year-over-year revenue growth, gross margin expansion, increased profitability, and strong cash generation," said Nick Hotchkin, the Company’s CFO. "We are confident our business momentum will continue throughout the balance of the year, and therefore, we are raising our earnings guidance for the full year 2017."

Q3 2017 Consolidated Results
% Change
% Change
Adjusted for
Constant
Currency
Three Months Ended
September 30,
October 1,
2017
2016
(in millions except percentages and per share amounts)
Service Revenues, net
$273.2
$232.6
17.5%
16.1%
Product Sales and Other, net
50.5
48.2
4.6%
3.3%
Revenues, net
$323.7
$280.8
15.3%
13.9%
Operating Income
$91.4
$66.8
36.8%
34.4%
Net Income*
$44.7
$34.7
29.0%
25.8%
EPS
$0.65
$0.53
23.7%
20.6%
Total Paid Weeks
45.4
38.0
19.8%
N/A
Meeting(1) Paid Weeks
18.9
17.0
11.2%
N/A
Online(2) Paid Weeks
26.6
21.0
26.7%
N/A
End of Period Subscribers(3)
3.4
2.8
18.4%
N/A
Meeting Subscribers
1.3
1.2
10.6%
N/A
Online Subscribers
2.0
1.6
24.4%
N/A
Note: Totals may not sum due to rounding.
See "Reconciliation of Non-GAAP Financial Measures" attached to this release for further detail on adjustments to GAAP financial measures.
(1) "Meetings" refers to providing access to combined meetings and digital offerings to the Company’s commitment plan subscribers (including Total Access subscribers), as well as access to meetings to the Company’s "pay-as-you-go" members and other meetings members.
(2) "Online" refers to Weight Watchers Online, Weight Watchers OnlinePlus, Personal Coaching and other digital subscription products.
(3) "Subscribers" refers to meetings members and Online subscribers who participate in recurring billing programs.
*Except in the case of the financials attached to this release, "Net Income" refers to Net Income attributable to Weight Watchers International, Inc.

Q3 2017 Business and Financial Highlights

End of Period Subscribers in Q3 2017 were up 18.4% versus the prior year period, driven by growth in all major geographic markets. Q3 2017 End of Period Meeting Subscribers were up 10.6% and End of Period Online Subscribers were up 24.4% versus the prior year period.

Total Paid Weeks in Q3 2017 were up 19.8% versus the prior year period, driven by growth in all major geographic markets. Q3 2017 Meeting Paid Weeks increased 11.2% and Online Paid Weeks increased 26.7% versus the prior year period.

Revenues in Q3 2017 were $323.7 million. On a constant currency basis, Q3 2017 revenues increased 13.9% versus the prior year period.

Service Revenues in Q3 2017 were $273.2 million. On a constant currency basis, these revenues increased 16.1% versus the prior year period. This increase was driven by growth in all major geographic markets on a constant currency basis.

Product Sales and Other in Q3 2017 were $50.5 million. On a constant currency basis, these revenues increased 3.3% versus the prior year period, with growth in product sales partially offset by declines in licensing.

Operating Income in Q3 2017 was $91.4 million. On a constant currency basis, operating income increased 34.4% versus the prior year period. This increase was primarily driven by operating leverage on higher revenues in the quarter versus the prior year period.

Tax Rate in Q3 2017 was 30.5% as compared to 10.3% in the prior year period. The Q3 2017 tax rate was lower than anticipated due to the reversal of certain tax reserves.

Net Income in Q3 2017 was $44.7 million compared to $34.7 million in the prior year period.

Earnings per fully diluted share (EPS) in Q3 2017 was $0.65 compared to $0.53 in the prior year period.

Certain Items Affecting Year-Over-Year Comparability

Q3 2017 results benefited from the reversal of certain tax reserves, the impact of which positively impacted EPS by $0.03 per fully diluted share.

Q3 2016 results benefited from a lower tax rate in the quarter, primarily driven by the net tax incentives related to prior-year technology investments partially offset by out-of-period adjustments. The net impact of these items positively impacted Q3 2016 EPS by $0.13 per fully diluted share.

Other Items

Cash balance was $178.2 million as of the end of Q3 2017. At September 30, 2017, under the Company’s credit facility, the Company had $1,930.4 million outstanding consisting entirely of Tranche B-2 Term Loans and had $47.8 million in available unused commitments under the revolving facility thereunder.

Full Year Fiscal 2017 Earnings Guidance

The Company is raising its full year fiscal 2017 earnings guidance to between $1.77 and $1.83 per fully diluted share.

Third Quarter 2017 Conference Call and Webcast

The Company has scheduled a conference call today at 5:00 p.m. ET. During the conference call, Mindy Grossman, President and Chief Executive Officer, and Nicholas Hotchkin, Chief Financial Officer, will discuss the third quarter fiscal 2017 results and answer questions from the investment community. Live audio of the conference call will be simultaneously webcast over the Internet on the Company’s corporate website, www.weightwatchersinternational.com. 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:

To supplement the Company’s consolidated results presented in accordance with accounting principles generally accepted in the United States (GAAP), the Company has disclosed non-GAAP financial measures of operating results that exclude or adjust certain items. The Company presents in the attachments to this release the non-GAAP financial measure earnings before interest, taxes, depreciation, amortization and stock-based compensation (EBITDAS). In addition, the Company presents certain of its financial results on a constant currency basis in addition to GAAP results. Constant currency information compares results between periods as if exchange rates had remained constant period-over-period. In this release and any attachments, the Company calculates constant currency by calculating current-year results using prior-year foreign currency exchange rates.

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 entitled 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 Weight Watchers International, Inc.

Weight Watchers International, Inc. is one of the most recognized and trusted brand names among weight-conscious consumers. Weight Watchers provides commercial weight management services through a global network of Company-owned and franchise operations and offers innovative, digital weight management products through its websites, mobile sites and apps. These services and products are built on the Company’s weight management program, which helps millions of people around the world lose weight through sensible and sustainable food plans, activity, behavior modification and group support. Weight Watchers has an unparalleled network of service providers to assist members on their journey and also offers a wide range of products, publications and programs for those interested in weight loss and healthier living.

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, earnings guidance and any statements about the Company’s plans, strategies and prospects. The Company generally uses the words "may," "will," "could," "expect," "anticipate," "believe," "estimate," "plan," "intend" 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 industry participants or the development of more effective or more favorably perceived weight management methods; 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 and products to continue to appeal to the market, or the Company’s ability to successfully expand into new channels of distribution or respond to consumer trends; the ability to successfully implement new strategic initiatives; the effectiveness of the Company’s advertising and marketing programs, including the strength of its social media presence; the impact on the Weight Watchers brand of actions taken by the Company’s franchisees, licensees, suppliers and other partners; the inability to refinance the Company’s debt obligations on favorable terms or at all; the impact of the Company’s debt service obligations and restrictive debt covenants; uncertainties regarding the satisfactory operation of the Company’s information technology or systems; the impact of security breaches or privacy concerns; the recognition of asset impairment charges; the loss of key personnel, strategic partners or consultants or failure to effectively manage and motivate the Company’s workforce; the Company’s chief executive officer transition; the inability to renew certain of the Company’s licenses, or the inability to do so on terms that are favorable to the Company; the expiration or early termination by the Company of leases; risks and uncertainties associated with the Company’s international operations, including regulatory, economic, political and social risks and foreign currency risks; uncertainties related to a downturn in general economic conditions or consumer confidence; the Company’s ability to successfully make acquisitions or enter into joint ventures, including its ability to successfully integrate, operate or realize the anticipated benefits of such businesses; the seasonal nature of the Company’s business; the impact of events that discourage or impede people from gathering with others or accessing resources; the Company’s ability to enforce its intellectual property rights both domestically and internationally, as well as the impact of its involvement in any claims related to intellectual property rights; the outcomes of litigation or regulatory actions; the impact of existing and future laws and regulations; the Company’s failure to maintain effective internal control over financial reporting; the possibility that the interests of Artal Group S.A., who effectively controls the Company, will conflict with other holders of the Company’s common stock; and other risks and uncertainties, including those detailed from time to time in the Company’s periodic reports filed with the Securities and Exchange Commission. You should not put undue reliance on any forward-looking statements. You should understand that many important factors, including those discussed herein, could cause the Company’s results to differ materially from those expressed or suggested in any forward-looking statement. Except as required by law, the Company does not undertake any obligation to update or revise these forward-looking statements to reflect new information or events or circumstances that occur after the date of this news release or to reflect the occurrence of unanticipated events or otherwise. Readers are advised to review the Company’s filings with the Securities and Exchange Commission (which are available from the SEC’s EDGAR database at www.sec.gov, at various SEC reference facilities in the United States and via the Company’s website at www.weightwatchersinternational.com).

Contact Information:
Investors:
Media:
Corey Kinger
Sara Bosco
(212) 601-7569
(347) 421-0389
corey.kinger@weightwatchers.com sara.n.bosco@weightwatchers.com
WEIGHT WATCHERS INTERNATIONAL, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(IN MILLIONS)
UNAUDITED
September 30,
December 31,
2017
2016
ASSETS
Current assets
$
280.5
$
235.2
Property and equipment, net
48.8
49.6
Goodwill, franchise rights and other intangible assets, net 974.2
973.4
Other assets
12.0
12.8
TOTAL ASSETS
$
1,315.5
$
1,271.0
LIABILITIES AND TOTAL DEFICIT
Current liabilities
$
293.2
$
292.4
Long-term debt
1,884.8
1,981.3
Deferred income taxes, other
218.2
200.2
TOTAL LIABILITIES
$
2,396.2
$
2,473.9
Redeemable noncontrolling interest
4.6
4.7
Shareholders’ deficit
(1,085.3)
(1,207.6)
TOTAL LIABILITIES AND TOTAL DEFICIT
$
1,315.5
$
1,271.0
WEIGHT WATCHERS INTERNATIONAL, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF NET INCOME
(IN MILLIONS, EXCEPT PER SHARE AMOUNTS)
UNAUDITED
Three Months Ended
September 30,
October 1,
2017
2016
Service revenues, net (1)
$
273.2
$
232.6
Product sales and other, net (2)
50.5
48.2
Revenues, net
323.7
280.8
Cost of services (3)
118.1
111.5
Cost of product sales and other (4)
28.5
25.0
Cost of revenues
146.6
136.5
Gross profit
177.1
144.3
Marketing expenses
30.3
30.1
Selling, general and administrative expenses
55.4
47.4
Operating income
91.4
66.8
Interest expense
27.0
28.3
Other expense (income), net
0.1
(0.1)
Income before income taxes
64.3
38.6
Provision for income taxes
19.6
4.0
Net income
44.7
34.6
Net loss attributable to the noncontrolling interest
0.1
0.0
Net income attributable to Weight Watchers International, Inc.
$
44.7
$
34.7
Earnings Per Share attributable to Weight Watchers International, Inc.
Basic
$
0.69
$
0.54
Diluted
$
0.65
$
0.53
Weighted average common shares outstanding:
Basic
64.5
63.8
Diluted
68.7
65.8
Note: Totals may not sum due to rounding.
(1)
Consists of net "Meeting Fees" and net "Online Subscription Revenues". "Meeting Fees" consist of the fees associated with the Company’s subscription plans for combined meetings and digital offerings and other payment arrangements for access to meetings.
"Online Subscription Revenues" consist of the fees associated with subscriptions for the Company’s Online subscription products, including the Company’s Personal Coaching product.
(2)Consists of sales of products to members in meetings and online, revenues from licensing, magazine subscriptions, publishing and third-party advertising in publications, payments from the sale of third-party online advertising and By Mail, other revenues, and franchise fees with respect to commitment plans and commissions.
(3)Consists of meeting operating expense and online cost of revenues excluding online advertising costs.
(4)Consists of meetings cost of product, online advertising costs, non-meeting cost of products and other.
WEIGHT WATCHERS INTERNATIONAL, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF NET INCOME
(IN MILLIONS, EXCEPT PER SHARE AMOUNTS)
UNAUDITED
Nine Months Ended
September 30,
October 1,
2017
2016
Service revenues, net (1)
$
817.7
$
727.9
Product sales and other, net (2)
176.7
169.6
Revenues, net
994.4
897.5
Cost of services (3)
363.3
355.9
Cost of product sales and other (4)
100.9
86.5
Cost of revenues
464.2
442.5
Gross profit
530.2
455.0
Marketing expenses
158.7
157.8
Selling, general and administrative expenses
153.7
143.2
Operating income
217.8
154.1
Interest expense
82.2
87.0
Other expense, net
0.3
0.4
Gain on early extinguishment of debt
(1.6)
0.0
Income before income taxes
136.9
66.7
Provision for income taxes
36.5
12.4
Net income
100.4
54.3
Net loss attributable to the noncontrolling interest
0.1
0.1
Net income attributable to Weight Watchers International, Inc.
$
100.5
$
54.4
Earnings Per Share attributable to Weight Watchers International, Inc.
Basic
$
1.57
$
0.85
Diluted
$
1.48
$
0.83
Weighted average common shares outstanding:
Basic
64.2
63.7
Diluted
67.9
65.9
Note: Totals may not sum due to rounding.
(1)
Consists of net "Meeting Fees" and net "Online Subscription Revenues". "Meeting Fees" consist of the fees associated with the Company’s subscription plans for combined meetings and digital offerings and other payment arrangements for access to meetings.
"Online Subscription Revenues" consist of the fees associated with subscriptions for the Company’s Online subscription products, including the Company’s Personal Coaching product.
(2)Consists of sales of products to members in meetings and online, revenues from licensing, magazine subscriptions, publishing and third-party advertising in publications, payments from the sale of third-party online advertising and By Mail, other revenues, and franchise fees with respect to commitment plans and commissions.
(3)Consists of meeting operating expense and online cost of revenues excluding online advertising costs.
(4)Consists of meetings cost of product, online advertising costs, non-meeting cost of products and other.
WEIGHT WATCHERS INTERNATIONAL, INC. AND SUBSIDIARIES
OPERATIONAL STATISTICS
(IN MILLIONS, EXCEPT PERCENTAGES)
UNAUDITED
Three Months Ended
September 30,
October 1,
Variance
2017
2016
Meeting Paid Weeks (1)
North America
13.0
11.3
14.5%
UK
2.6
2.4
4.6%
CE
2.7
2.6
4.9%
Other (2)
0.7
0.6
3.4%
Total Meeting Paid Weeks
18.9
17.0
11.2%
Online Paid Weeks (1)
North America
17.0
13.4
26.5%
UK
1.8
1.5
17.3%
CE
7.2
5.4
32.8%
Other (2)
0.5
0.5
(1.8%)
Total Online Paid Weeks
26.6
21.0
26.7%
Total Paid Weeks (1)
North America
30.0
24.8
21.0%
UK
4.4
4.0
9.5%
CE
9.9
8.0
23.8%
Other (2)
1.2
1.2
1.0%
Total Paid Weeks
45.4
38.0
19.8%
End of Period Meeting Subscribers (3)
North America
0.9
0.8
14.1%
UK
0.2
0.2
1.1%
CE
0.2
0.2
4.9%
Other (2)
0.0
0.0
7.9%
Total End of Period Meeting Subscribers
1.3
1.2
10.6%
End of Period Online Subscribers (3)
North America
1.3
1.0
23.1%
UK
0.1
0.1
14.4%
CE
0.6
0.4
32.7%
Other (2)
0.0
0.0
1.8%
Total End of Period Online Subscribers
2.0
1.6
24.4%
Total End of Period Subscribers (3)
North America
2.2
1.8
19.1%
UK
0.3
0.3
6.5%
CE
0.8
0.6
23.8%
Other (2)
0.1
0.1
4.5%
Total End of Period Subscribers
3.4
2.8
18.4%
Note: Totals may not sum due to rounding.
(1) The "Paid Weeks" metric reports paid weeks by Weight Watchers customers in Company-owned operations for a given period as follows: (i) "Meeting Paid Weeks" is the sum of total paid commitment plan weeks (including Total Access) and total "pay-as-you-go" weeks; (ii) "Online Paid Weeks" is the total paid subscription weeks for the Company’s digital subscription products (including Personal Coaching); and (iii) "Total Paid Weeks" is the sum of Meeting Paid Weeks and Online Paid Weeks.
(2) Represents Australia, New Zealand and emerging markets.
(3) The "End of Period Subscribers" metric reports Weight Watchers subscribers in Company-owned operations at a given period end as follows: (i) "End of Period Meeting Subscribers" is the total number of Weight Watchers commitment plan subscribers (including Total Access); (ii) "End of Period Online Subscribers" is the total number of Weight Watchers Online, Weight Watchers OnlinePlus and Personal Coaching subscribers; and (iii) "End of Period Subscribers" is the sum of End of Period Meeting Subscribers and End of Period Online Subscribers.
WEIGHT WATCHERS INTERNATIONAL, INC. AND SUBSIDIARIES
OPERATIONAL STATISTICS
(IN MILLIONS, EXCEPT PERCENTAGES)
UNAUDITED
Nine Months Ended
September 30,
October 1,
Variance
2017
2016
Meeting Paid Weeks (1)
North America
39.7
35.0
13.5%
UK
7.9
7.8
0.5%
CE
8.6
8.4
1.6%
Other (2)
2.0
1.9
7.8%
Total Meeting Paid Weeks
58.3
53.2
9.5%
Online Paid Weeks (1)
North America
51.3
42.2
21.4%
UK
5.4
4.7
15.6%
CE
21.1
16.5
27.8%
Other (2)
1.7
1.7
1.5%
Total Online Paid Weeks
79.5
65.1
22.1%
Total Paid Weeks (1)
North America
91.0
77.2
17.8%
UK
13.3
12.5
6.2%
CE
29.7
25.0
18.9%
Other (2)
3.7
3.6
4.9%
Total Paid Weeks
137.7
118.3
16.4%
End of Period Meeting Subscribers (3)
North America
0.9
0.8
14.1%
UK
0.2
0.2
1.1%
CE
0.2
0.2
4.9%
Other (2)
0.0
0.0
7.9%
Total End of Period Meeting Subscribers
1.3
1.2
10.6%
End of Period Online Subscribers (3)
North America
1.3
1.0
23.1%
UK
0.1
0.1
14.4%
CE
0.6
0.4
32.7%
Other (2)
0.0
0.0
1.8%
Total End of Period Online Subscribers
2.0
1.6
24.4%
Total End of Period Subscribers (3)
North America
2.2
1.8
19.1%
UK
0.3
0.3
6.5%
CE
0.8
0.6
23.8%
Other (2)
0.1
0.1
4.5%
Total End of Period Subscribers
3.4
2.8
18.4%
Note: Totals may not sum due to rounding.
(1) The "Paid Weeks" metric reports paid weeks by Weight Watchers customers in Company-owned operations for a given period as follows: (i) "Meeting Paid Weeks" is the sum of total paid commitment plan weeks (including Total Access) and total "pay-as-you-go" weeks; (ii) "Online Paid Weeks" is the total paid subscription weeks for the Company’s digital subscription products (including Personal Coaching); and (iii) "Total Paid Weeks" is the sum of Meeting Paid Weeks and Online Paid Weeks.
(2) Represents Australia, New Zealand and emerging markets.
(3) The "End of Period Subscribers" metric reports Weight Watchers subscribers in Company-owned operations at a given period end as follows: (i) "End of Period Meeting Subscribers" is the total number of Weight Watchers commitment plan subscribers (including Total Access); (ii) "End of Period Online Subscribers" is the total number of Weight Watchers Online, Weight Watchers OnlinePlus and Personal Coaching subscribers; and (iii) "End of Period Subscribers" is the sum of End of Period Meeting Subscribers and End of Period Online Subscribers.
WEIGHT WATCHERS INTERNATIONAL, INC. AND SUBSIDIARIES
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES
(IN MILLIONS, EXCEPT PERCENTAGES)
UNAUDITED
Q3 2017 Variance
2017
Constant
Q3 2017
Q3 2016
2017
Currency
Currency
Constant
vs
vs
GAAP
Adjustment
Currency
GAAP
2016
2016
Selected Financial Data
Consolidated Company Revenues
$
323.7
$
(3.9)
$
319.8
$
280.8
15.3%
13.9%
Consolidated Meeting Fees (1)
$
165.6
$
(1.6)
$
164.0
$
147.9
12.0%
10.8%
Consolidated Online Subscription Revenues (2) $
107.6
$
(1.7)
$
105.9
$
84.6
27.1%
25.2%
Consolidated Service Revenues (3)
$
273.2
$
(3.3)
$
269.9
$
232.6
17.5%
16.1%
Consolidated Product Sales and Other (4)
$
50.5
$
(0.6)
$
49.9
$
48.2
4.6%
3.3%
North America
Meeting Fees (1)
$
122.4
$
(0.4)
$
122.1
$
107.6
13.8%
13.4%
Online Subscription Revenues(2)
$
71.3
$
(0.2)
$
71.1
$
57.9
23.1%
22.7%
Service Revenues (3)
$
193.7
$
(0.6)
$
193.2
$
165.5
17.0%
16.7%
Product Sales and Other(4)
$
29.9
$
(0.1)
$
29.9
$
27.4
9.5%
9.2%
Total Revenues
$
223.7
$
(0.6)
$
223.0
$
192.9
16.0%
15.6%
UK
Meeting Fees (1)
$
13.3
$
0.0
$
13.4
$
12.6
5.2%
5.6%
Online Subscription Revenues(2)
$
5.7
$
0.0
$
5.7
$
4.6
22.4%
22.8%
Service Revenues (3)
$
19.0
$
0.1
$
19.1
$
17.3
9.8%
10.2%
Product Sales and Other(4)
$
6.5
$
0.0
$
6.5
$
6.2
4.7%
4.9%
Total Revenues
$
25.5
$
0.1
$
25.6
$
23.5
8.5%
8.8%
CE
Meeting Fees (1)
$
23.4
$
(1.1)
$
22.3
$
21.3
10.0%
4.8%
Online Subscription Revenues(2)
$
27.7
$
(1.4)
$
26.4
$
19.3
43.8%
36.8%
Service Revenues (3)
$
51.2
$
(2.5)
$
48.7
$
40.6
26.1%
20.0%
Product Sales and Other(4)
$
9.5
$
(0.5)
$
9.0
$
10.1
(5.9%)
(10.5%)
Total Revenues
$
60.7
$
(2.9)
$
57.7
$
50.7
19.7%
13.9%
Other (5)
Meeting Fees (1)
$
6.5
$
(0.2)
$
6.3
$
6.4
1.2%
(2.2%)
Online Subscription Revenues(2)
$
2.9
$
(0.1)
$
2.7
$
2.8
3.3%
(0.7%)
Service Revenues (3)
$
9.3
$
(0.3)
$
9.0
$
9.2
1.8%
(1.7%)
Product Sales and Other(4)
$
4.5
$
(0.1)
$
4.4
$
4.6
(1.4%)
(3.6%)
Total Revenues
$
13.9
$
(0.4)
$
13.4
$
13.8
0.8%
(2.4%)
Note: Totals may not sum due to rounding.
(1) "Meeting Fees" consist of the fees associated with the Company’s subscription plans for combined meetings and digital offerings and other payment arrangements for access to meetings.
(2) "Online Subscription Revenues" consist of the fees associated with subscriptions for the Company’s Online subscription products, including the Company’s Personal Coaching product.
(3) "Service Revenues" equal "Meeting Fees" plus "Online Subscription Revenues".
(4) "Product Sales" are sales of products to members in meetings and online, and "Other" are revenues from licensing, magazine subscriptions, publishing and third-party advertising in publications, payments from the sale of third-party online advertising and By Mail, other revenues, and, in the case of the consolidated financial results and Other reportable segment, includes franchise fees with respect to commitment plans and commissions.
(5) Represents Australia, New Zealand, emerging markets and franchise revenues.
WEIGHT WATCHERS INTERNATIONAL, INC. AND SUBSIDIARIES
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES
(IN MILLIONS, EXCEPT PERCENTAGES)
UNAUDITED
YTD 2017 Variance
2017
Constant
YTD 2017
YTD 2016
2017
Currency
Currency
Constant
vs
vs
GAAP
Adjustment
Currency
GAAP
2016
2016
Selected Financial Data
Consolidated Company Revenues
$
994.4
$
6.0
$
1,000.4
$
897.5
10.8%
11.5%
Consolidated Meeting Fees (1)
$
505.0
$
2.9
$
507.8
$
464.3
8.8%
9.4%
Consolidated Online Subscription Revenues (2) $
312.7
$
1.2
$
313.9
$
263.6
18.6%
19.1%
Consolidated Service Revenues (3)
$
817.7
$
4.0
$
821.7
$
727.9
12.3%
12.9%
Consolidated Product Sales and Other (4)
$
176.7
$
2.0
$
178.7
$
169.6
4.2%
5.4%
North America
Meeting Fees (1)
$
376.1
$
(0.2)
$
375.9
$
334.2
12.5%
12.5%
Online Subscription Revenues(2)
$
213.0
$
(0.1)
$
212.8
$
183.7
16.0%
15.9%
Service Revenues (3)
$
589.1
$
(0.4)
$
588.7
$
517.9
13.8%
13.7%
Product Sales and Other(4)
$
106.3
$
(0.1)
$
106.2
$
95.4
11.4%
11.3%
Total Revenues
$
695.4
$
(0.4)
$
695.0
$
613.3
13.4%
13.3%
UK
Meeting Fees (1)
$
39.4
$
3.6
$
43.1
$
43.1
(8.4%)
(0.0%)
Online Subscription Revenues(2)
$
15.9
$
1.4
$
17.3
$
14.6
8.6%
18.1%
Service Revenues (3)
$
55.3
$
5.0
$
60.3
$
57.7
(4.1%)
4.6%
Product Sales and Other(4)
$
20.6
$
2.0
$
22.5
$
22.4
(8.1%)
0.6%
Total Revenues
$
75.9
$
7.0
$
82.9
$
80.1
(5.2%)
3.5%
CE
Meeting Fees (1)
$
70.2
$
0.4
$
70.6
$
69.4
1.1%
1.7%
Online Subscription Revenues(2)
$
75.0
$
0.2
$
75.2
$
57.2
31.1%
31.5%
Service Revenues (3)
$
145.2
$
0.6
$
145.8
$
126.6
14.7%
15.2%
Product Sales and Other(4)
$
34.4
$
0.4
$
34.8
$
36.8
(6.6%)
(5.6%)
Total Revenues
$
179.6
$
1.0
$
180.6
$
163.4
9.9%
10.5%
Other (5)
Meeting Fees (1)
$
19.3
$
(1.0)
$
18.3
$
17.6
9.1%
3.7%
Online Subscription Revenues(2)
$
8.9
$
(0.3)
$
8.6
$
8.1
9.5%
5.7%
Service Revenues (3)
$
28.1
$
(1.3)
$
26.9
$
25.7
9.3%
4.4%
Product Sales and Other(4)
$
15.4
$
(0.3)
$
15.1
$
14.9
3.2%
1.2%
Total Revenues
$
43.5
$
(1.6)
$
42.0
$
40.7
7.0%
3.2%
Note: Totals may not sum due to rounding.
(1) "Meeting Fees" consist of the fees associated with the Company’s subscription plans for combined meetings and digital offerings and other payment arrangements for access to meetings.
(2) "Online Subscription Revenues" consist of the fees associated with subscriptions for the Company’s Online subscription products, including the Company’s Personal Coaching product.
(3) "Service Revenues" equal "Meeting Fees" plus "Online Subscription Revenues".
(4) "Product Sales" are sales of products to members in meetings and online, and "Other" are revenues from licensing, magazine subscriptions, publishing and third-party advertising in publications, payments from the sale of third-party online advertising and By Mail, other revenues, and, in the case of the consolidated financial results and Other reportable segment, includes franchise fees with respect to commitment plans and commissions.
(5) Represents Australia, New Zealand, emerging markets and franchise revenues.
WEIGHT WATCHERS INTERNATIONAL, INC. AND SUBSIDIARIES
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES
(IN MILLIONS, EXCEPT PERCENTAGES)
UNAUDITED
Q3 2017 Variance
2017
Q3 2017
Q3 2016
Constant
2017
Currency
Currency
Constant
vs
vs
GAAP
Adjustment
Currency
GAAP
2016
2016
Selected Financial Data
Gross Profit
$
177.1
$
(2.5)
$
174.6
$
144.3
22.7%
21.0%
Gross Margin
54.7%
54.6%
51.4%
Selling, General and Administrative Expenses $
55.4
$
(0.4)
$
55.0
$
47.4
16.8%
15.8%
Operating Income
$
91.4
$
(1.6)
$
89.8
$
66.8
36.8%
34.4%
Operating Income Margin
28.2%
28.1%
23.8%
Note: Totals may not sum due to rounding.
WEIGHT WATCHERS INTERNATIONAL, INC. AND SUBSIDIARIES
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES
(IN MILLIONS, EXCEPT PERCENTAGES)
UNAUDITED
YTD 2017 Variance
2017
YTD 2017
YTD 2016
Constant
2017
Currency
Currency
Constant
vs
vs
GAAP
Adjustment
Currency
GAAP
2016
2016
Selected Financial Data
Gross Profit
$
530.2
$
2.9
$
533.1
$
455.0
16.5%
17.2%
Gross Margin
53.3%
53.3%
50.7%
Selling, General and Administrative Expenses $
153.7
$
0.5
$
154.2
$
143.2
7.3%
7.7%
Operating Income
$
217.8
$
0.6
$
218.4
$
154.1
41.4%
41.7%
Operating Income Margin
21.9%
21.8%
17.2%
Note: Totals may not sum due to rounding.
WEIGHT WATCHERS INTERNATIONAL, INC. AND SUBSIDIARIES
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES
(IN MILLIONS)
UNAUDITED
Three Months Ended
Nine Months Ended
September 30,
October 1,
September 30,
October 1,
2017
2016
2017
2016
Net Income
$
44.7
$
34.7
$
100.5
$
54.4
Interest
27.0
28.3
82.2
87.0
Taxes
19.6
4.0
36.5
12.4
Depreciation and Amortization
12.8
13.4
38.3
39.1
Stock-based Compensation
4.6
(0.6)
9.4
4.4
EBITDAS
$
108.6
$
79.8
$
266.9
$
197.3
Note: Totals may not sum due to rounding.

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SOURCE Weight Watchers International, Inc.

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