WW International, Inc. (NASDAQ: WW) (“WeightWatchers,” “WW,” or the
“Company”) today announced its results for the fourth quarter and
full year fiscal 2022.
“It has been nearly one year since I joined WeightWatchers - a
time of significant transition, rationalization, and bold moves
throughout the organization. We ended 2022 with 3.5 million
subscribers, ahead of our guidance, improving our position as we
started the year,” said Sima Sistani, the Company’s CEO. “Our
member engagement and satisfaction metrics are up, demonstrating
that our initiatives to improve the experience and brand are having
a positive impact. We expect performance trends to improve
throughout the year as we benefit from our data-informed approach
to member acquisition, increased efficiency from streamlined
operations, and new product features to enhance the member
experience. We look forward to upcoming launches focused on
creating community, supporting members, and enabling key behaviors,
as well as our entry into clinical weight management.”
“Our efforts to streamline and centralize our operations are
reading through into an improved cost basis for our business. We
are confident that we will have the appropriate cost structure in
place, along with ample liquidity, to support our product roadmap
and our entrance into clinical weight management,” said Heather
Stark, the Company’s Interim Principal Financial Officer. “While
member signups are down year-over-year so far in 2023, that is a
result of intentionally shifting a portion of our annual marketing
spend from winter into the fall as we look to focus our spend
alongside our digital product launches in the second half of the
year, and ultimately return the Company to growth.”
Q4 2022 Consolidated Results
|
|
|
|
|
% Change |
|
% ChangeAdjusted
forConstantCurrency(1) |
|
Three Months Ended |
|
|
|
December 31, |
|
January 1, |
|
|
|
2022 |
|
2022 |
|
|
(in millions except
percentages and per share amounts) |
|
|
|
|
|
|
|
Subscription Revenues, net |
$200.9 |
|
|
$247.9 |
|
(19.0 |
%) |
|
(15.6 |
%) |
Product Sales and Other, net |
|
23.0 |
|
|
|
27.8 |
|
(17.4 |
%) |
|
(14.1 |
%) |
Revenues,
net |
$223.9 |
|
|
$275.8 |
|
(18.8 |
%) |
|
(15.5 |
%) |
Gross
Profit |
$127.0 |
|
|
$168.9 |
|
(24.8 |
%) |
|
(21.1 |
%) |
Non-GAAP Adjustments(1) |
|
|
|
|
|
|
|
Net Restructuring Charges(2) |
|
3.1 |
|
|
|
0.3 |
|
|
|
|
Adjusted Gross
Profit(1) |
$130.1 |
|
|
$169.2 |
|
(23.1 |
%) |
|
(19.4 |
%) |
Operating (Loss)
Income |
($50.8 |
) |
|
$54.1 |
|
(193.9 |
%) |
|
(192.6 |
%) |
Non-GAAP Adjustments(1) |
|
|
|
|
|
|
|
Franchise Rights Acquired and Goodwill Impairments |
|
57.6 |
|
|
|
- |
|
|
|
|
Net Restructuring Charges(2) |
|
17.4 |
|
|
|
0.6 |
|
|
|
|
Adjusted Operating
Income(1) |
$24.2 |
|
|
$54.6 |
|
(55.8 |
%) |
|
(50.2 |
%) |
Net (Loss)
Income |
($32.5 |
) |
|
$29.9 |
|
(208.6 |
%) |
|
(207.4 |
%) |
EPS |
($0.46 |
) |
|
$0.42 |
|
(208.7 |
%) |
|
(207.5 |
%) |
Total Paid
Weeks |
|
47.3 |
|
|
|
55.9 |
|
(15.3 |
%) |
|
N/A |
Digital(3)Paid Weeks |
|
37.8 |
|
|
|
45.8 |
|
(17.5 |
%) |
|
N/A |
Workshops + Digital(4)Paid Weeks |
|
9.6 |
|
|
|
10.1 |
|
(5.5 |
%) |
|
N/A |
End of Period
Subscribers(5) |
|
3.5 |
|
|
|
4.2 |
|
(14.9 |
%) |
|
N/A |
Digital Subscribers |
|
2.8 |
|
|
|
3.4 |
|
(17.6 |
%) |
|
N/A |
Workshops + Digital Subscribers |
|
0.7 |
|
|
|
0.7 |
|
(2.3 |
%) |
|
N/A |
|
|
|
|
|
|
|
|
___________________________________Note: Totals may not sum due to
rounding.(1) See “Reconciliation of Non-GAAP
Financial Measures” attached to this release for further detail on
adjustments to GAAP financial measures.(2) See
“Reconciliation of Non-GAAP Financial Measures” attached to this
release for further detail on the Company’s previously disclosed
2023, 2022, 2021, and 2020 restructuring plans, and the reversal of
certain of the charges associated therewith.
(3) “Digital” refers to providing subscriptions to
the Company’s digital product offerings, including Personal
Coaching + Digital and Digital 360 (as
applicable).(4) “Workshops + Digital” refers to
providing unlimited access to the Company’s workshops combined with
the Company’s digital subscription product offerings to commitment
plan subscribers, including former Digital 360 members as
applicable. It also includes the provision of access to workshops
for members who do not subscribe to commitment plans, including the
Company’s “pay-as-you-go”
members.(5) “Subscribers” refers to Digital
subscribers and Workshops + Digital subscribers who participate in
recurring bill programs in Company-owned operations. |
|
Q4 2022 Business and Financial Highlights
- End of Period Subscribers in Q4 2022 were down
14.9% versus the prior year period, primarily driven by declines in
the Digital business in all geographic markets. Q4 2022 End of
Period Digital Subscribers decreased 17.6% versus the prior year
period. Q4 2022 End of Period Workshops + Digital Subscribers
decreased 2.3% versus the prior year period, substantially
benefitting from the transition of former Digital 360 members from
the Digital business to the Workshops + Digital business during Q2
and Q3 2022, as previously disclosed.
- Total Paid Weeks in Q4 2022 were down 15.3%
versus the prior year period, driven by declines in the Digital
business in all geographic markets. Q4 2022 Digital Paid Weeks
decreased 17.5% versus the prior year period. Q4 2022 Workshops +
Digital Paid Weeks decreased 5.5% versus the prior year period,
substantially benefitting from the transition of former Digital 360
members from the Digital business to the Workshops + Digital
business during Q2 and Q3 2022, as previously disclosed.
- Revenues in Q4 2022 were $223.9 million. On a
constant currency basis, Q4 2022 revenues decreased 15.5% versus
the prior year period.
- Subscription Revenues in Q4 2022 were $200.9
million. On a constant currency basis, these revenues decreased
15.6% versus the prior year period.
- Product Sales and Other in Q4 2022 were $23.0
million. On a constant currency basis, these revenues decreased
14.1% versus the prior year period.
- Gross Profit in Q4 2022 was $127.0 million,
compared to $168.9 million in the prior year period.
Adjusted gross profit in Q4 2022, which excluded
the net impact of $3.1 million of restructuring charges, was $130.1
million. Adjusted gross profit in Q4 2021, which excluded the net
impact of $0.3 million of restructuring charges, was $169.2
million.
- Gross Margin in Q4 2022 was 56.7%, as compared
to 61.2% in the prior year period. Adjusted gross
margin in Q4 2022 was 58.1%, down 320 basis points from an
adjusted gross margin of 61.3% in the prior year period, primarily
driven by a mix shift to the Workshops + Digital business and fixed
cost deleverage in our Workshops + Digital business as well as a 40
basis point negative impact from foreign currency.
- Non-Cash Intangible Impairment Charges: During
Q4 2022, the Company identified several factors, including business
performance, market capitalization, and interest rates, that
indicated a triggering event for impairment testing. In
Q4 2022, the Company recorded non-cash impairment charges of
Franchise Rights Acquired and Goodwill totaling $57.6 million that
included charges of $25.7 million, $19.7 million, $8.3 million,
$2.0 million, and $1.8 million related to its U.S., Canada, U.K.,
Republic of Ireland (Goodwill only), and Australia operations,
respectively. The impairment charges were primarily driven by an
increase in the Company’s weighted-average cost of capital,
reflecting market factors including higher interest rates and the
trading values of the Company’s equity and debt.
- Operating Loss in Q4 2022 was $50.8 million,
compared to operating income of $54.1 million in the prior year
period. 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 $24.2 million. Adjusted operating income
in Q4 2021, which excluded the net impact of $0.6 million of
restructuring charges, was $54.6 million.
- Income Tax in Q4 2022 was a benefit of $38.9
million, which reflected a legal entity restructuring that resulted
in a reversal of certain deferred tax liabilities, partially offset
by a tax expense from a valuation allowance established to offset
certain deferred tax assets due to the uncertainty of realizing
future tax benefits from interest expense carryforwards. In the
prior year period, income tax expense was $3.3 million.
- Net Loss in Q4 2022 was $32.5 million compared
to net income of $29.9 million in the prior year period.
- Diluted Net Loss per share in Q4 2022 was
$0.46 compared to earnings per fully diluted share (EPS) of $0.42
in the prior year period.
- Certain items affect year-over-year comparability.
- 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 negative net 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 2021 EPS was positively impacted by $0.07 per fully diluted
share in the aggregate due to the following items:
- $0.09 per fully diluted share positive impact of a state tax
decrease on certain deferred income.
- $0.01 per fully diluted share net negative impact of
restructuring charges.
- $0.01 per fully diluted share negative impact of early
extinguishment of debt charges.
Full Year 2022 Consolidated Results
|
|
|
|
|
% Change |
|
% ChangeAdjusted
forConstantCurrency(1) |
|
Twelve Months Ended |
|
|
|
December 31, |
|
January 1, |
|
|
|
2022 |
|
2022 |
|
|
(in millions except
percentages and per share amounts) |
|
|
|
|
|
|
|
Subscription Revenues, net |
$919.1 |
|
|
$1,063.0 |
|
(13.5 |
%) |
|
(10.3 |
%) |
Product Sales and Other, net |
|
121.8 |
|
|
|
149.4 |
|
(18.5 |
%) |
|
(15.8 |
%) |
Revenues,
net |
$1,040.9 |
|
|
$1,212.5 |
|
(14.2 |
%) |
|
(11.0 |
%) |
Gross
Profit |
$622.4 |
|
|
$726.4 |
|
(14.3 |
%) |
|
(10.5 |
%) |
Non-GAAP Adjustments(1) |
|
|
|
|
|
|
|
Net Restructuring Charges(2) |
|
7.0 |
|
|
|
15.4 |
|
|
|
|
Adjusted Gross
Profit(1) |
$629.4 |
|
|
$741.8 |
|
(15.2 |
%) |
|
(11.5 |
%) |
Operating (Loss)
Income |
($283.0 |
) |
|
$196.3 |
|
(244.2 |
%) |
|
(239.2 |
%) |
Non-GAAP Adjustments(1) |
|
|
|
|
|
|
|
Franchise Rights Acquired and Goodwill Impairments |
|
396.7 |
|
|
|
- |
|
|
|
|
Net Restructuring Charges(2) |
|
39.7 |
|
|
|
19.9 |
|
|
|
|
Adjusted Operating
Income(1) |
$153.5 |
|
|
$216.2 |
|
(29.0 |
%) |
|
(22.5 |
%) |
Net (Loss)
Income |
($251.4 |
) |
|
$66.9 |
|
(475.8 |
%) |
|
(466.0 |
%) |
EPS |
($3.58 |
) |
|
$0.95 |
|
(478.1 |
%) |
|
(468.2 |
%) |
Total Paid
Weeks |
|
215.7 |
|
|
|
243.4 |
|
(11.4 |
%) |
|
N/A |
Digital(3) Paid Weeks |
|
175.8 |
|
|
|
204.1 |
|
(13.9 |
%) |
|
N/A |
Workshops + Digital(4) Paid Weeks |
|
39.9 |
|
|
|
39.3 |
|
1.4 |
% |
|
N/A |
End of Period
Subscribers(5) |
|
3.5 |
|
|
|
4.2 |
|
(14.9 |
%) |
|
N/A |
Digital Subscribers |
|
2.8 |
|
|
|
3.4 |
|
(17.6 |
%) |
|
N/A |
Workshops + Digital Subscribers |
|
0.7 |
|
|
|
0.7 |
|
(2.3 |
%) |
|
N/A |
|
|
|
|
|
|
|
|
___________________________________Note: Totals may not sum due to
rounding.(1) See “Reconciliation of Non-GAAP
Financial Measures” attached to this release for further detail on
adjustments to GAAP financial measures.(2) See
“Reconciliation of Non-GAAP Financial Measures” attached to this
release for further detail on the Company’s previously disclosed
2023, 2022, 2021, and 2020 restructuring plans, and the reversal of
certain of the charges associated therewith.
(3) “Digital” refers to providing subscriptions to
the Company’s digital product offerings, including Personal
Coaching + Digital and Digital 360 (as
applicable).(4) “Workshops + Digital” refers to
providing unlimited access to the Company’s workshops combined with
the Company’s digital subscription product offerings to commitment
plan subscribers, including former Digital 360 members as
applicable. It also includes the provision of access to workshops
for members who do not subscribe to commitment plans, including the
Company’s “pay-as-you-go”
members.(5) “Subscribers” refers to Digital
subscribers and Workshops + Digital subscribers who participate in
recurring bill programs in Company-owned operations. |
Full Year 2022 Business and Financial
Highlights
- Total Paid Weeks in fiscal 2022 were down
11.4% versus the prior year, driven by declines in the Digital
business in all geographic markets. Fiscal 2022 Digital Paid Weeks
decreased 13.9% versus the prior year. Fiscal 2022 Workshops +
Digital Paid Weeks increased 1.4% versus the prior year,
substantially benefitting from the transition of former Digital 360
members from the Digital business to the Workshops + Digital
business during Q2 and Q3 2022, as previously disclosed.
- Revenues in fiscal 2022 were $1,040.9 million.
On a constant currency basis, fiscal 2022 revenues decreased 11.0%
versus the prior year.
- Subscription Revenues in fiscal 2022 were
$919.1 million. On a constant currency basis, these revenues
decreased 10.3% versus the prior year.
- Product Sales and Other in fiscal 2022 were
$121.8 million. On a constant currency basis, these revenues
decreased 15.8% versus the prior year.
- Gross Profit in fiscal 2022 was $622.4
million, compared to $726.4 million in the prior year.
Adjusted gross profit in fiscal 2022, which
excluded the net impact of $7.0 million of restructuring charges,
was $629.4 million. Adjusted gross profit in fiscal 2021, which
excluded the net impact of $15.4 million of restructuring charges,
was $741.8 million.
- Gross Margin in fiscal 2022 was 59.8%, as
compared to 59.9% in the prior year. Adjusted gross
margin in fiscal 2022 was 60.5%, down 70 basis points from
an adjusted gross margin of 61.2% in the prior year, primarily
driven by a mix shift to the Workshops + Digital business as well
as a 30 basis point negative impact from foreign currency.
- Operating Loss in fiscal 2022 was $283.0
million, compared to operating income of $196.3 million in the
prior year. 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 $153.5 million. Adjusted operating
income in fiscal 2021, which excluded the net impact of $19.9
million of restructuring charges, was $216.2 million.
- Income Tax in fiscal 2022 was a benefit of
$114.4 million, which reflected franchise rights acquired and
goodwill impairment charges and a legal entity restructuring that
both resulted in a reversal of certain deferred tax liabilities,
partially offset by a tax expense from a valuation allowance
established to offset certain deferred tax assets due to the
uncertainty of realizing future tax benefits from interest expense
carryforwards. In the prior year, income tax expense was $9.8
million.
- Net Loss in fiscal 2022 was $251.4 million
compared to net income of $66.9 million in the prior year.
- Diluted Net Loss per share in fiscal 2022 was
$3.58 compared to earnings per fully diluted share (EPS) of $0.95
in the prior year.
- Certain items affect year-over-year comparability.
- 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 negative net 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 2021 EPS incorporated the negative impact by $0.42 per
fully diluted share in the aggregate due to the following items:
- $0.32 per fully diluted share aggregate negative impact from
early extinguishment of debt charges, including those associated
with the Company’s April 2021 debt refinancing.
- $0.21 per fully diluted share net negative impact of
restructuring charges.
- $0.09 per fully diluted share positive impact of a state tax
decrease on certain deferred income.
- $0.02 per fully diluted share positive impact of tax benefits
due to the reversal of a valuation allowance related to certain net
operating losses now expected to be realized.
Other Items
- Cash balance as of December 31, 2022 was
$178.3 million. On that same date, the Company had no outstanding
borrowings under its revolving credit facility.
- Restructuring:
- 2023 Restructuring Plan: As previously announced, in December
2022 the Company resolved to centralize its global management of
certain functions and systems, deprioritize and in some cases cease
operations for certain non-strategic business lines, and continue
the rationalization of its real estate portfolio. In connection
with the 2023 Restructuring Plan, the Company anticipates recording
restructuring charges which it currently estimates will range
between $39.0 million to $46.0 million in the aggregate. The
Company recorded $13.6 million of such restructuring charges in Q4
2022 and expects the majority of the remaining restructuring
charges to be recorded within the first six months of fiscal
2023.
- 2022 Restructuring Plan: In connection with its previously
announced 2022 Restructuring Plan, the Company recorded
restructuring charges of $4.5 million in Q4 2022 and $27.2 million
in fiscal 2022.
- As separately announced on March 6, 2023, the Company will
acquire Sequence in a cash and equity transaction valued at $132.0
million, inclusive of a minimum of $26.0 million of Sequence’s
cash. The effective net purchase price is $106.0 million. The
transaction, which is subject to customary closing conditions, is
expected to close during the second quarter of fiscal 2023.
2023 Guidance
The Company is providing the following Q1 2023
guidance:
- Revenues are expected to be approximately $235.0 million.
- Operating loss, which includes approximately $20.0 million in
restructuring charges, is expected to be in the range of ($30.0)
million to ($35.0) million.
The Company is not providing full year 2023 guidance today given
its anticipated acquisition of Sequence.
Fourth Quarter and Full Year 2022 Conference Call and
WebcastThe Company has scheduled a conference call today
at 5:00 p.m. ET. During the conference call, Sima Sistani,
Chief Executive Officer, and Heather Stark, Interim Principal
Financial Officer, will discuss the fourth quarter and full year
fiscal 2022 results and answer questions from the investment
community.
The live webcast of the conference call will be available on the
Company’s corporate website, corporate.ww.com, in the Investors
section under Presentations and Events. Supplemental investor
materials for full year fiscal 2022 results 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
MeasuresThe 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 the
United States (“GAAP”), the Company has disclosed non-GAAP
financial measures of operating results that exclude or adjust
certain items. Gross profit, gross margin, operating (loss) income,
operating (loss) income margin, and selling, general and
administrative expenses are discussed both as reported (on a GAAP
basis) and as adjusted (on a non-GAAP basis), as applicable, with
respect to (i) the fourth quarter and full year fiscal 2022 to
exclude (a) the impact of impairment charges for the Company's
franchise rights acquired related to its United States, Canada,
United Kingdom, New Zealand and Australia units of account and
impairment charges for the Company's goodwill related to its
Republic of Ireland reporting unit and its wholly-owned subsidiary
Kurbo, Inc. and (b) the net impact of (w) charges associated with
the Company's previously disclosed 2023 restructuring plan (the
“2023 plan”), (x) charges associated with the Company's previously
disclosed 2022 restructuring plan (the “2022 plan”), (y) charges
associated with the Company's previously disclosed 2021
organizational restructuring plan (the “2021 plan”) or the reversal
of certain of the charges associated with the 2021 plan, as
applicable, and (z) the reversal of certain of the charges
associated with the Company's previously disclosed 2020
organizational restructuring plan (the “2020 plan”); and (ii) the
fourth quarter and full year fiscal 2021 to exclude the net impact
of (x) charges associated with the 2021 plan and (y) the reversal
of certain of the charges associated with the 2020 plan. We
generally refer to such non-GAAP measures as follows: (i) with
respect to the adjustments for the fourth quarter and full year
fiscal 2022, as excluding or adjusting for the impact of franchise
rights acquired and goodwill impairments (or non-cash intangible
impairment charges) and the net impact of restructuring charges;
and (ii) with respect to the adjustments for the fourth quarter and
full year fiscal 2021, as excluding or adjusting for the net impact
of restructuring charges. The Company also presents in the
attachments to this release the non-GAAP financial measures
earnings before interest, taxes, depreciation, amortization and
stock-based compensation (“EBITDAS”); earnings before interest,
taxes, depreciation, amortization, stock-based compensation,
franchise rights acquired and goodwill impairments, net
restructuring charges, and early extinguishment of debt with
respect to the Company’s previously disclosed April 2021 debt
refinancing and voluntary debt prepayments (“Adjusted EBITDAS”);
total debt less unamortized deferred financing costs, unamortized
debt discount and cash on hand (i.e., net debt); and a net
debt/Adjusted EBITDAS ratio. 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. 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 WW International, Inc. WeightWatchers is
a human-centric technology company powered by our proven,
science-based, clinically effective weight loss and weight
management program. For nearly 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 program. 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, revenue and
operating loss 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: the
impact of the COVID-19 pandemic on the Company's business and on
the consumer environment and markets in which the Company operates;
competition from other weight management 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 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 transform its Workshops +
Digital business strategy to meet the evolving needs 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 and other partners, including as a result of its proposed
acquisition of Weekend Health, Inc., which is doing business as
Sequence (“Weekend Health”) (the “Acquisition”); 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 recent 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 early termination by the Company of
leases; uncertainties related to a downturn in general economic
conditions or consumer confidence, including as a result of the
existing inflationary environment or the potential impact of
political and social unrest; the Company's ability to successfully
make acquisitions or enter into joint ventures or collaborations,
including its ability to successfully integrate, operate or realize
the anticipated benefits of such businesses, including with respect
to Weekend Health; the seasonal nature of the Company's core
business; the impact of events that discourage or impede people
from gathering with others or impede accessing resources; the
Company's failure to maintain effective internal control over
financial reporting; the impact of the Company's substantial amount
of debt, debt service obligations and debt covenants, and its
exposure to variable rate indebtedness; the ability to generate
sufficient cash to service the Company's debt and satisfy its other
liquidity requirements; uncertainties regarding the satisfactory
operation of the Company's technology or systems; the impact of
data security breaches and other malicious acts or privacy
concerns, including the costs of compliance with evolving privacy
laws and regulations; 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; risks and uncertainties associated
with the Company's international operations, including regulatory,
economic, political, social, intellectual property, and foreign
currency risks, which risks may be exacerbated as a result of the
war in Ukraine; the outcomes of litigation or regulatory actions;
the impact of existing and future laws and regulations; risks
related to the Company's proposed Acquisition, including risks that
the Company may not complete the Acquisition or that the
Acquisition may not achieve its intended results; risks related to
the Company's potential exposure to extensive and complex
healthcare laws and regulations as a result of the proposed
Acquisition; the possibility that the interests of Artal Group
S.A., the largest holder of the Company's common stock and a
shareholder with significant influence over the Company, will
conflict with the Company's interests or the interests of other
holders of the Company's common stock; the impact that the sale of
substantial amounts of the Company's common stock by existing large
shareholders, or the perception that such sales could occur, could
have on the market price 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 SEC. 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 United States
Securities and Exchange Commission (which are available on the
SEC’s EDGAR database at www.sec.gov and via the Company’s website
at corporate.ww.com).
WW INTERNATIONAL, INC. AND SUBSIDIARIES |
CONSOLIDATED BALANCE SHEETS AT |
(IN THOUSANDS) |
UNAUDITED |
|
|
|
|
|
|
|
December 31, |
|
January 1, |
|
|
|
2022 |
|
|
|
2022 |
|
ASSETS |
|
|
|
|
CURRENT ASSETS |
|
|
|
|
Cash and cash equivalents |
|
$ |
178,326 |
|
|
$ |
153,794 |
|
Receivables (net of allowances: December 31, 2022 - $976 and
January 1, 2022 - $1,726) |
|
|
24,273 |
|
|
|
29,321 |
|
Inventories |
|
|
20,528 |
|
|
|
30,566 |
|
Prepaid income taxes |
|
|
19,447 |
|
|
|
30,478 |
|
Prepaid expenses and other current assets |
|
|
38,757 |
|
|
|
27,014 |
|
TOTAL CURRENT ASSETS |
|
|
281,331 |
|
|
|
271,173 |
|
Property and equipment, net |
|
|
28,229 |
|
|
|
37,219 |
|
Operating lease assets |
|
|
75,696 |
|
|
|
89,902 |
|
Franchise rights acquired |
|
|
386,745 |
|
|
|
785,195 |
|
Goodwill |
|
|
155,998 |
|
|
|
157,374 |
|
Other intangible assets, net |
|
|
63,306 |
|
|
|
61,126 |
|
Deferred income taxes |
|
|
22,246 |
|
|
|
11,259 |
|
Other noncurrent assets |
|
|
14,879 |
|
|
|
15,686 |
|
TOTAL ASSETS |
|
$ |
1,028,430 |
|
|
$ |
1,428,934 |
|
LIABILITIES AND TOTAL DEFICIT |
|
|
|
|
CURRENT LIABILITIES |
|
|
|
|
Portion of operating lease liabilities due within one year |
|
$ |
17,955 |
|
|
$ |
20,297 |
|
Accounts payable |
|
|
18,890 |
|
|
|
22,444 |
|
Salaries and wages payable |
|
|
72,577 |
|
|
|
57,401 |
|
Accrued marketing and advertising |
|
|
17,927 |
|
|
|
15,904 |
|
Accrued interest |
|
|
5,289 |
|
|
|
5,085 |
|
Other accrued liabilities |
|
|
30,118 |
|
|
|
45,728 |
|
Derivative payable |
|
|
— |
|
|
|
14,670 |
|
Income taxes payable |
|
|
1,646 |
|
|
|
1,748 |
|
Deferred revenue |
|
|
32,156 |
|
|
|
45,855 |
|
TOTAL CURRENT LIABILITIES |
|
|
196,558 |
|
|
|
229,132 |
|
Long-term debt, net |
|
|
1,422,284 |
|
|
|
1,418,104 |
|
Long-term operating lease liabilities |
|
|
68,099 |
|
|
|
78,157 |
|
Deferred income taxes |
|
|
23,119 |
|
|
|
157,718 |
|
Other |
|
|
2,185 |
|
|
|
2,227 |
|
TOTAL LIABILITIES |
|
|
1,712,245 |
|
|
|
1,885,338 |
|
|
|
|
|
|
TOTAL DEFICIT |
|
|
|
|
Common stock, $0 par value; 1,000,000 shares authorized; 122,052
shares issued at December 31, 2022 and 122,052 shares issued at
January 1, 2022 |
|
|
0 |
|
|
|
0 |
|
Treasury stock, at cost, 51,496 shares at December 31, 2022 and
51,988 shares at January 1, 2022 |
|
|
(3,097,304 |
) |
|
|
(3,120,149 |
) |
Retained earnings |
|
|
2,418,959 |
|
|
|
2,682,349 |
|
Accumulated other comprehensive loss |
|
|
(5,470 |
) |
|
|
(18,604 |
) |
TOTAL DEFICIT |
|
|
(683,815 |
) |
|
|
(456,404 |
) |
TOTAL LIABILITIES AND TOTAL DEFICIT |
|
$ |
1,028,430 |
|
|
$ |
1,428,934 |
|
|
|
|
|
|
WW INTERNATIONAL, INC. AND SUBSIDIARIES |
|
CONSOLIDATED STATEMENTS OF OPERATIONS |
|
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS) |
|
UNAUDITED |
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended |
|
|
|
|
December 31, |
|
January 1, |
|
|
|
|
|
2022 |
|
|
|
2022 |
|
Subscription revenues, net (1) |
|
$ |
200,933 |
|
|
$ |
247,947 |
|
Product sales and other, net (2) |
|
|
22,991 |
|
|
|
27,844 |
|
|
Revenues, net |
|
|
223,924 |
|
|
|
275,791 |
|
Cost of subscription revenues (3) |
|
|
77,817 |
|
|
|
84,855 |
|
Cost of product sales and other |
|
|
19,117 |
|
|
|
22,079 |
|
|
Cost of revenues |
|
|
96,934 |
|
|
|
106,934 |
|
|
Gross profit |
|
|
126,990 |
|
|
|
168,857 |
|
Marketing expenses |
|
|
49,660 |
|
|
|
52,801 |
|
Selling, general and administrative expenses |
|
|
70,520 |
|
|
|
61,998 |
|
Franchise rights acquired and goodwill impairments |
|
|
57,566 |
|
|
|
— |
|
|
Operating (loss) income |
|
|
(50,756 |
) |
|
|
54,058 |
|
Interest expense |
|
|
22,304 |
|
|
|
19,210 |
|
Other (income) expense, net |
|
|
(1,612 |
) |
|
|
451 |
|
Early extinguishment of debt |
|
|
— |
|
|
|
1,183 |
|
|
(Loss) income before income taxes |
|
|
(71,448 |
) |
|
|
33,214 |
|
(Benefit from) provision for income taxes |
|
|
(38,948 |
) |
|
|
3,285 |
|
|
Net (loss) income |
|
$ |
(32,500 |
) |
|
$ |
29,929 |
|
|
|
|
|
|
|
|
(Net loss) earnings per share |
|
|
|
|
|
|
Basic |
|
$ |
(0.46 |
) |
|
$ |
0.43 |
|
|
Diluted |
|
$ |
(0.46 |
) |
|
$ |
0.42 |
|
|
|
|
|
|
|
|
Weighted average common shares outstanding |
|
|
|
|
|
|
Basic |
|
|
70,509 |
|
|
|
70,011 |
|
|
Diluted |
|
|
70,509 |
|
|
|
70,586 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Note: Totals may not sum due to rounding. |
|
|
|
|
|
(1) Consists of net “Digital Subscription Revenues” and net
“Workshops + Digital Fees”. "Digital Subscription Revenues" consist
of the fees associated with subscriptions for the Company’s Digital
offerings, including 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. |
|
(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 and
Workshops + Digital services. |
|
|
|
|
|
|
|
WW INTERNATIONAL, INC. AND SUBSIDIARIES |
|
CONSOLIDATED STATEMENTS OF OPERATIONS |
|
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS) |
|
UNAUDITED |
|
|
|
|
|
|
|
|
|
|
|
Twelve Months Ended |
|
|
|
|
December 31, |
|
January 1, |
|
|
|
|
|
2022 |
|
|
|
2022 |
|
Subscription revenues, net (1) |
|
$ |
919,055 |
|
|
$ |
1,063,039 |
|
Product sales and other, net (2) |
|
|
121,801 |
|
|
|
149,424 |
|
|
Revenues, net |
|
|
1,040,856 |
|
|
|
1,212,463 |
|
Cost of subscription revenues (3) |
|
|
321,528 |
|
|
|
370,064 |
|
Cost of product sales and other |
|
|
96,928 |
|
|
|
116,044 |
|
|
Cost of revenues |
|
|
418,456 |
|
|
|
486,108 |
|
|
Gross profit |
|
|
622,400 |
|
|
|
726,355 |
|
Marketing expenses |
|
|
244,783 |
|
|
|
261,457 |
|
Selling, general and administrative expenses |
|
|
263,840 |
|
|
|
268,614 |
|
Franchise rights acquired and goodwill impairments |
|
|
396,727 |
|
|
|
— |
|
|
Operating (loss) income |
|
|
(282,950 |
) |
|
|
196,284 |
|
Interest expense |
|
|
81,141 |
|
|
|
87,909 |
|
Other expense, net |
|
|
1,691 |
|
|
|
1,358 |
|
Early extinguishment of debt |
|
|
— |
|
|
|
30,352 |
|
|
(Loss) income before income taxes |
|
|
(365,782 |
) |
|
|
76,665 |
|
(Benefit from) provision for income taxes |
|
|
(114,379 |
) |
|
|
9,773 |
|
|
Net (loss) income |
|
$ |
(251,403 |
) |
|
$ |
66,892 |
|
|
|
|
|
|
|
|
(Net loss) earnings per share |
|
|
|
|
|
|
Basic |
|
$ |
(3.58 |
) |
|
$ |
0.96 |
|
|
Diluted |
|
$ |
(3.58 |
) |
|
$ |
0.95 |
|
|
|
|
|
|
|
|
Weighted average common shares outstanding |
|
|
|
|
|
|
Basic |
|
|
70,321 |
|
|
|
69,640 |
|
|
Diluted |
|
|
70,321 |
|
|
|
70,744 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Note: Totals may not sum due to rounding. |
|
|
|
|
|
(1) Consists of net “Digital Subscription Revenues” and net
“Workshops + Digital Fees”. "Digital Subscription Revenues" consist
of the fees associated with subscriptions for the Company’s Digital
offerings, including 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. |
|
(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 and
Workshops + Digital services. |
|
|
|
|
|
|
|
WW INTERNATIONAL, INC. AND SUBSIDIARIES |
CONSOLIDATED STATEMENTS OF CASH FLOWS |
(IN THOUSANDS) |
UNAUDITED |
|
|
|
|
|
|
|
Twelve Months Ended |
|
|
December 31, |
|
January 1, |
|
|
|
2022 |
|
|
|
2022 |
|
Operating activities: |
|
|
|
|
Net (loss) income |
|
$ |
(251,403 |
) |
|
$ |
66,892 |
|
Adjustments to reconcile net (loss) income to cash provided by
operating activities: |
|
|
|
|
Depreciation and amortization |
|
|
43,801 |
|
|
|
48,550 |
|
Amortization of deferred financing costs and debt discount |
|
|
5,018 |
|
|
|
6,136 |
|
Impairment of franchise rights acquired and goodwill |
|
|
396,727 |
|
|
|
— |
|
Impairment of intangible and long-lived assets |
|
|
3,455 |
|
|
|
521 |
|
Share-based compensation expense |
|
|
12,957 |
|
|
|
21,348 |
|
Deferred tax benefit |
|
|
(150,994 |
) |
|
|
(15,565 |
) |
Allowance for doubtful accounts |
|
|
(460 |
) |
|
|
(214 |
) |
Reserve for inventory obsolescence |
|
|
6,796 |
|
|
|
7,657 |
|
Foreign currency exchange rate loss |
|
|
2,374 |
|
|
|
744 |
|
Early extinguishment of debt |
|
|
— |
|
|
|
30,352 |
|
Changes in cash due to: |
|
|
|
|
Receivables |
|
|
(7,558 |
) |
|
|
4,707 |
|
Inventories |
|
|
3,733 |
|
|
|
1,816 |
|
Prepaid expenses |
|
|
9,599 |
|
|
|
1,554 |
|
Accounts payable |
|
|
(2,691 |
) |
|
|
373 |
|
Accrued liabilities |
|
|
19,904 |
|
|
|
1,272 |
|
Deferred revenue |
|
|
(11,733 |
) |
|
|
(3,886 |
) |
Other long term assets and liabilities, net |
|
|
(2,291 |
) |
|
|
(7,962 |
) |
Income taxes |
|
|
(588 |
) |
|
|
(7,014 |
) |
Cash provided by operating activities |
|
|
76,646 |
|
|
|
157,281 |
|
Investing activities: |
|
|
|
|
Capital expenditures |
|
|
(2,065 |
) |
|
|
(2,446 |
) |
Capitalized software expenditures |
|
|
(36,187 |
) |
|
|
(35,205 |
) |
Cash paid for acquisitions |
|
|
(4,350 |
) |
|
|
(12,836 |
) |
Other items, net |
|
|
(42 |
) |
|
|
(2,266 |
) |
Cash used for investing activities |
|
|
(42,644 |
) |
|
|
(52,753 |
) |
Financing activities: |
|
|
|
|
Net (payments) borrowings on revolver |
|
|
— |
|
|
|
— |
|
Proceeds from long term debt |
|
|
— |
|
|
|
1,500,000 |
|
Financing costs and debt discount |
|
|
— |
|
|
|
(37,910 |
) |
Payments on long-term debt |
|
|
— |
|
|
|
(1,564,000 |
) |
Taxes paid related to net share settlement of equity awards |
|
|
(2,197 |
) |
|
|
(7,494 |
) |
Proceeds from stock options exercised |
|
|
— |
|
|
|
4,469 |
|
Cash paid for acquisitions |
|
|
(2,413 |
) |
|
|
(6,450 |
) |
Other items, net |
|
|
(112 |
) |
|
|
(151 |
) |
Cash used for financing activities |
|
|
(4,722 |
) |
|
|
(111,536 |
) |
Effect of exchange rate changes on cash and cash equivalents |
|
|
(4,748 |
) |
|
|
(5,085 |
) |
Net increase (decrease) in cash and cash equivalents |
|
|
24,532 |
|
|
|
(12,093 |
) |
Cash and cash equivalents, beginning of period |
|
|
153,794 |
|
|
|
165,887 |
|
Cash and cash equivalents, end of period |
|
$ |
178,326 |
|
|
$ |
153,794 |
|
|
|
|
|
|
WW
INTERNATIONAL, INC. AND SUBSIDIARIES |
OPERATIONAL
STATISTICS |
(IN
THOUSANDS, EXCEPT PERCENTAGES) |
UNAUDITED |
|
|
|
|
|
|
|
Three Months Ended |
|
|
|
December 31, |
|
January 1, |
|
Variance |
|
2022 |
|
2022 |
|
|
|
|
|
|
|
Digital Paid Weeks (1) |
|
|
|
|
|
North America |
23,714 |
|
28,681 |
|
(17.3 |
%) |
CE |
11,095 |
|
13,523 |
|
(18.0 |
%) |
UK |
2,019 |
|
2,545 |
|
(20.7 |
%) |
Other
(2) |
929 |
|
1,006 |
|
(7.7 |
%) |
Total
Digital Paid Weeks |
37,757 |
|
45,757 |
|
(17.5 |
%) |
|
|
|
|
|
|
Workshops + Digital Paid Weeks
(1) |
|
|
|
|
|
North
America |
7,178 |
|
7,528 |
|
(4.6 |
%) |
CE |
1,395 |
|
1,440 |
|
(3.1 |
%) |
UK |
813 |
|
927 |
|
(12.4 |
%) |
Other
(2) |
199 |
|
251 |
|
(20.9 |
%) |
Total
Workshops + Digital Paid Weeks |
9,585 |
|
10,146 |
|
(5.5 |
%) |
|
|
|
|
|
|
Total Paid Weeks (1) |
|
|
|
|
|
North
America |
30,892 |
|
36,209 |
|
(14.7 |
%) |
CE |
12,490 |
|
14,963 |
|
(16.5 |
%) |
UK |
2,831 |
|
3,473 |
|
(18.5 |
%) |
Other
(2) |
1,128 |
|
1,257 |
|
(10.3 |
%) |
Total Paid
Weeks |
47,342 |
|
55,902 |
|
(15.3 |
%) |
|
|
|
|
|
|
End
of Period Digital Subscribers (3) |
|
|
|
|
|
North
America |
1,802 |
|
2,187 |
|
(17.6 |
%) |
CE |
818 |
|
998 |
|
(18.1 |
%) |
UK |
143 |
|
180 |
|
(20.3 |
%) |
Other
(2) |
72 |
|
76 |
|
(5.0 |
%) |
Total End of
Period Digital Subscribers |
2,836 |
|
3,441 |
|
(17.6 |
%) |
|
|
|
|
|
|
End
of Period Workshops + Digital Subscribers
(3) |
|
|
|
|
|
North
America |
534 |
|
548 |
|
(2.5 |
%) |
CE |
104 |
|
96 |
|
8.9 |
% |
UK |
57 |
|
65 |
|
(13.4 |
%) |
Other
(2) |
15 |
|
18 |
|
(17.4 |
%) |
Total End of
Period Workshops + Digital Subscribers |
711 |
|
727 |
|
(2.3 |
%) |
|
|
|
|
|
|
Total End of Period Subscribers
(3) |
|
|
|
|
|
North
America |
2,337 |
|
2,735 |
|
(14.6 |
%) |
CE |
922 |
|
1,094 |
|
(15.7 |
%) |
UK |
200 |
|
245 |
|
(18.4 |
%) |
Other
(2) |
87 |
|
95 |
|
(7.5 |
%) |
Total End of
Period Subscribers |
3,546 |
|
4,169 |
|
(14.9 |
%) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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, including 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 and total
“pay-as-you-go” weeks; and (iii) “Total Paid Weeks” is the sum of
Digital Paid Weeks and Workshops + Digital Paid Weeks. |
(2) Represents Australia, New Zealand and emerging
markets. |
(3) 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 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; and
(iii) “End of Period Subscribers” is the sum of End of Period
Digital Subscribers and End of Period Workshops + Digital
Subscribers. |
|
|
|
|
|
|
WW INTERNATIONAL, INC. AND SUBSIDIARIES |
OPERATIONAL STATISTICS |
(IN THOUSANDS, EXCEPT PERCENTAGES) |
UNAUDITED |
|
|
|
|
|
|
|
Twelve Months Ended |
|
|
|
December 31, |
|
January 1, |
|
Variance |
|
2022 |
|
2022 |
|
|
|
|
|
|
|
Digital Paid Weeks (1) |
|
|
|
|
|
North America |
111,457 |
|
128,319 |
|
(13.1 |
%) |
CE |
51,017 |
|
59,325 |
|
(14.0 |
%) |
UK |
9,436 |
|
12,442 |
|
(24.2 |
%) |
Other (2) |
3,902 |
|
4,052 |
|
(3.7 |
%) |
Total Digital Paid Weeks |
175,812 |
|
204,139 |
|
(13.9 |
%) |
|
|
|
|
|
|
Workshops + Digital Paid Weeks
(1) |
|
|
|
|
|
North America |
29,902 |
|
28,682 |
|
4.3 |
% |
CE |
5,558 |
|
5,461 |
|
1.8 |
% |
UK |
3,537 |
|
3,977 |
|
(11.1 |
%) |
Other (2) |
859 |
|
1,177 |
|
(27.1 |
%) |
Total Workshops + Digital Paid Weeks |
39,856 |
|
39,298 |
|
1.4 |
% |
|
|
|
|
|
|
Total Paid Weeks (1) |
|
|
|
|
|
North America |
141,359 |
|
157,002 |
|
(10.0 |
%) |
CE |
56,575 |
|
64,787 |
|
(12.7 |
%) |
UK |
12,973 |
|
16,419 |
|
(21.0 |
%) |
Other (2) |
4,760 |
|
5,229 |
|
(9.0 |
%) |
Total Paid Weeks |
215,668 |
|
243,437 |
|
(11.4 |
%) |
|
|
|
|
|
|
End of Period Digital Subscribers
(3) |
|
|
|
|
|
North America |
1,802 |
|
2,187 |
|
(17.6 |
%) |
CE |
818 |
|
998 |
|
(18.1 |
%) |
UK |
143 |
|
180 |
|
(20.3 |
%) |
Other (2) |
72 |
|
76 |
|
(5.0 |
%) |
Total End of Period Digital Subscribers |
2,836 |
|
3,441 |
|
(17.6 |
%) |
|
|
|
|
|
|
End of Period Workshops + Digital Subscribers
(3) |
|
|
|
|
|
North America |
534 |
|
548 |
|
(2.5 |
%) |
CE |
104 |
|
96 |
|
8.9 |
% |
UK |
57 |
|
65 |
|
(13.4 |
%) |
Other (2) |
15 |
|
18 |
|
(17.4 |
%) |
Total End of Period Workshops + Digital Subscribers |
711 |
|
727 |
|
(2.3 |
%) |
|
|
|
|
|
|
Total End of Period Subscribers
(3) |
|
|
|
|
|
North America |
2,337 |
|
2,735 |
|
(14.6 |
%) |
CE |
922 |
|
1,094 |
|
(15.7 |
%) |
UK |
200 |
|
245 |
|
(18.4 |
%) |
Other (2) |
87 |
|
95 |
|
(7.5 |
%) |
Total End of Period Subscribers |
3,546 |
|
4,169 |
|
(14.9 |
%) |
|
|
|
|
|
|
|
|
|
|
|
|
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, including 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 and total
“pay-as-you-go” weeks; and (iii) “Total Paid Weeks” is the sum of
Digital Paid Weeks and Workshops + Digital Paid Weeks. |
(2) Represents Australia, New Zealand and emerging
markets. |
(3) 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 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; and
(iii) “End of Period Subscribers” is the sum of End of Period
Digital Subscribers and End of Period Workshops + Digital
Subscribers. |
|
|
|
|
|
|
WW INTERNATIONAL, INC. AND SUBSIDIARIES |
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES |
(IN THOUSANDS, EXCEPT PERCENTAGES) |
UNAUDITED |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Q4 2022 Variance |
|
|
|
|
|
|
|
|
|
|
|
|
2022 |
|
|
|
|
|
|
|
|
Constant |
|
|
Q4 2022 |
|
Q4 2021 |
|
2022 |
|
Currency |
|
|
|
|
Currency |
|
Constant |
|
|
|
vs |
|
vs |
|
|
GAAP |
|
Adjustment |
|
Currency |
|
GAAP |
|
2021 |
|
2021 |
Selected Financial Data |
|
|
|
|
|
|
|
|
|
|
|
Consolidated Company Revenues |
$ |
223,924 |
|
$ |
9,158 |
|
$ |
233,082 |
|
$ |
275,791 |
|
(18.8 |
%) |
|
(15.5 |
%) |
Consolidated Digital Subscription Revenues (1) |
$ |
141,085 |
|
$ |
6,567 |
|
$ |
147,652 |
|
$ |
181,486 |
|
(22.3 |
%) |
|
(18.6 |
%) |
Consolidated Workshops + Digital Fees (2) |
$ |
59,847 |
|
$ |
1,662 |
|
$ |
61,509 |
|
$ |
66,461 |
|
(10.0 |
%) |
|
(7.5 |
%) |
Consolidated Subscription Revenues (3) |
$ |
200,933 |
|
$ |
8,229 |
|
$ |
209,161 |
|
$ |
247,947 |
|
(19.0 |
%) |
|
(15.6 |
%) |
Consolidated Product Sales and Other (4) |
$ |
22,991 |
|
$ |
931 |
|
$ |
23,922 |
|
$ |
27,844 |
|
(17.4 |
%) |
|
(14.1 |
%) |
|
|
|
|
|
|
|
|
|
|
|
|
|
North America |
|
|
|
|
|
|
|
|
|
|
|
Digital Subscription Revenues (1) |
$ |
93,659 |
|
$ |
471 |
|
$ |
94,130 |
|
$ |
116,730 |
|
(19.8 |
%) |
|
(19.4 |
%) |
Workshops + Digital Fees (2) |
$ |
48,558 |
|
$ |
177 |
|
$ |
48,735 |
|
$ |
51,812 |
|
(6.3 |
%) |
|
(5.9 |
%) |
Subscription Revenues (3) |
$ |
142,215 |
|
$ |
649 |
|
$ |
142,864 |
|
$ |
168,542 |
|
(15.6 |
%) |
|
(15.2 |
%) |
Product Sales and Other (4) |
$ |
16,258 |
|
$ |
70 |
|
$ |
16,328 |
|
$ |
19,514 |
|
(16.7 |
%) |
|
(16.3 |
%) |
Total Revenues |
$ |
158,473 |
|
$ |
719 |
|
$ |
159,192 |
|
$ |
188,056 |
|
(15.7 |
%) |
|
(15.3 |
%) |
|
|
|
|
|
|
|
|
|
|
|
|
|
CE |
|
|
|
|
|
|
|
|
|
|
|
|
Digital Subscription Revenues (1) |
$ |
38,670 |
|
$ |
4,966 |
|
$ |
43,636 |
|
$ |
52,237 |
|
(26.0 |
%) |
|
(16.5 |
%) |
Workshops + Digital Fees (2) |
$ |
6,694 |
|
$ |
858 |
|
$ |
7,552 |
|
$ |
8,309 |
|
(19.4 |
%) |
|
(9.1 |
%) |
Subscription Revenues (3) |
$ |
45,365 |
|
$ |
5,824 |
|
$ |
51,189 |
|
$ |
60,546 |
|
(25.1 |
%) |
|
(15.5 |
%) |
Product Sales and Other (4) |
$ |
4,625 |
|
$ |
606 |
|
$ |
5,231 |
|
$ |
5,600 |
|
(17.4 |
%) |
|
(6.6 |
%) |
Total Revenues |
$ |
49,989 |
|
$ |
6,431 |
|
$ |
56,420 |
|
$ |
66,145 |
|
(24.4 |
%) |
|
(14.7 |
%) |
|
|
|
|
|
|
|
|
|
|
|
|
|
UK |
|
|
|
|
|
|
|
|
|
|
|
|
Digital Subscription Revenues (1) |
$ |
5,315 |
|
$ |
774 |
|
$ |
6,089 |
|
$ |
7,937 |
|
(33.0 |
%) |
|
(23.3 |
%) |
Workshops + Digital Fees (2) |
$ |
3,331 |
|
$ |
491 |
|
$ |
3,822 |
|
$ |
4,405 |
|
(24.4 |
%) |
|
(13.2 |
%) |
Subscription Revenues (3) |
$ |
8,647 |
|
$ |
1,265 |
|
$ |
9,912 |
|
$ |
12,342 |
|
(29.9 |
%) |
|
(19.7 |
%) |
Product Sales and Other (4) |
$ |
1,255 |
|
$ |
196 |
|
$ |
1,451 |
|
$ |
1,742 |
|
(28.0 |
%) |
|
(16.7 |
%) |
Total Revenues |
$ |
9,901 |
|
$ |
1,461 |
|
$ |
11,362 |
|
$ |
14,085 |
|
(29.7 |
%) |
|
(19.3 |
%) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Other (5) |
|
|
|
|
|
|
|
|
|
|
|
Digital Subscription Revenues (1) |
$ |
3,441 |
|
$ |
356 |
|
$ |
3,797 |
|
$ |
4,582 |
|
(24.9 |
%) |
|
(17.1 |
%) |
Workshops + Digital Fees (2) |
$ |
1,265 |
|
$ |
134 |
|
$ |
1,399 |
|
$ |
1,935 |
|
(34.6 |
%) |
|
(27.7 |
%) |
Subscription Revenues (3) |
$ |
4,706 |
|
$ |
490 |
|
$ |
5,196 |
|
$ |
6,517 |
|
(27.8 |
%) |
|
(20.3 |
%) |
Product Sales and Other (4) |
$ |
853 |
|
$ |
58 |
|
$ |
911 |
|
$ |
988 |
|
(13.7 |
%) |
|
(7.8 |
%) |
Total Revenues |
$ |
5,559 |
|
$ |
548 |
|
$ |
6,107 |
|
$ |
7,505 |
|
(25.9 |
%) |
|
(18.6 |
%) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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, including
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) “Subscription
Revenues” equal “Digital Subscription Revenues" plus “Workshops +
Digital Fees”. |
(4) “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 Other reportable segment,
franchise fees with respect to commitment plans and royalties. |
(5) Represents
Australia, New Zealand, emerging markets and franchise
revenues. |
|
WW INTERNATIONAL, INC. AND SUBSIDIARIES |
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES |
(IN THOUSANDS, EXCEPT PERCENTAGES) |
UNAUDITED |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Full Year 2022 Variance |
|
|
|
|
|
|
|
|
|
|
|
|
2022 |
|
|
|
|
|
|
|
|
Constant |
|
|
Full Year 2022 |
|
Full Year 2021 |
2022 |
|
Currency |
|
|
|
|
Currency |
|
Constant |
|
|
|
vs |
|
vs |
|
|
GAAP |
|
Adjustment |
|
Currency |
|
GAAP |
|
2021 |
|
2021 |
Selected Financial Data |
|
|
|
|
|
|
|
|
|
|
|
Consolidated Company Revenues |
$ |
1,040,856 |
|
$ |
38,611 |
|
$ |
1,079,467 |
|
$ |
1,212,463 |
|
(14.2 |
%) |
|
(11.0 |
%) |
Consolidated Digital Subscription Revenues (1) |
$ |
662,668 |
|
$ |
28,137 |
|
$ |
690,805 |
|
$ |
788,173 |
|
(15.9 |
%) |
|
(12.4 |
%) |
Consolidated Workshops + Digital Fees (2) |
$ |
256,387 |
|
$ |
6,458 |
|
$ |
262,845 |
|
$ |
274,866 |
|
(6.7 |
%) |
|
(4.4 |
%) |
Consolidated Subscription Revenues (3) |
$ |
919,055 |
|
$ |
34,595 |
|
$ |
953,650 |
|
$ |
1,063,039 |
|
(13.5 |
%) |
|
(10.3 |
%) |
Consolidated Product Sales and Other (4) |
$ |
121,801 |
|
$ |
4,015 |
|
$ |
125,816 |
|
$ |
149,424 |
|
(18.5 |
%) |
|
(15.8 |
%) |
|
|
|
|
|
|
|
|
|
|
|
|
|
North America |
|
|
|
|
|
|
|
|
|
|
|
Digital Subscription Revenues (1) |
$ |
436,148 |
|
$ |
1,051 |
|
$ |
437,199 |
|
$ |
504,152 |
|
(13.5 |
%) |
|
(13.3 |
%) |
Workshops + Digital Fees (2) |
$ |
204,115 |
|
$ |
371 |
|
$ |
204,486 |
|
$ |
210,076 |
|
(2.8 |
%) |
|
(2.7 |
%) |
Subscription Revenues (3) |
$ |
640,263 |
|
$ |
1,422 |
|
$ |
641,685 |
|
$ |
714,228 |
|
(10.4 |
%) |
|
(10.2 |
%) |
Product Sales and Other (4) |
$ |
86,621 |
|
$ |
172 |
|
$ |
86,793 |
|
$ |
100,569 |
|
(13.9 |
%) |
|
(13.7 |
%) |
Total Revenues |
$ |
726,884 |
|
$ |
1,594 |
|
$ |
728,478 |
|
$ |
814,797 |
|
(10.8 |
%) |
|
(10.6 |
%) |
|
|
|
|
|
|
|
|
|
|
|
|
|
CE |
|
|
|
|
|
|
|
|
|
|
|
|
Digital Subscription Revenues (1) |
$ |
184,590 |
|
$ |
23,109 |
|
$ |
207,699 |
|
$ |
228,296 |
|
(19.1 |
%) |
|
(9.0 |
%) |
Workshops + Digital Fees (2) |
$ |
30,293 |
|
$ |
3,858 |
|
$ |
34,151 |
|
$ |
36,707 |
|
(17.5 |
%) |
|
(7.0 |
%) |
Subscription Revenues (3) |
$ |
214,883 |
|
$ |
26,967 |
|
$ |
241,850 |
|
$ |
265,003 |
|
(18.9 |
%) |
|
(8.7 |
%) |
Product Sales and Other (4) |
$ |
24,246 |
|
$ |
2,908 |
|
$ |
27,154 |
|
$ |
32,907 |
|
(26.3 |
%) |
|
(17.5 |
%) |
Total Revenues |
$ |
239,129 |
|
$ |
29,874 |
|
$ |
269,003 |
|
$ |
297,910 |
|
(19.7 |
%) |
|
(9.7 |
%) |
|
|
|
|
|
|
|
|
|
|
|
|
|
UK |
|
|
|
|
|
|
|
|
|
|
|
|
Digital Subscription Revenues (1) |
$ |
25,421 |
|
$ |
2,726 |
|
$ |
28,147 |
|
$ |
36,347 |
|
(30.1 |
%) |
|
(22.6 |
%) |
Workshops + Digital Fees (2) |
$ |
15,813 |
|
$ |
1,759 |
|
$ |
17,572 |
|
$ |
18,709 |
|
(15.5 |
%) |
|
(6.1 |
%) |
Subscription Revenues (3) |
$ |
41,234 |
|
$ |
4,485 |
|
$ |
45,719 |
|
$ |
55,056 |
|
(25.1 |
%) |
|
(17.0 |
%) |
Product Sales and Other (4) |
$ |
6,761 |
|
$ |
705 |
|
$ |
7,466 |
|
$ |
10,764 |
|
(37.2 |
%) |
|
(30.6 |
%) |
Total Revenues |
$ |
47,995 |
|
$ |
5,191 |
|
$ |
53,186 |
|
$ |
65,820 |
|
(27.1 |
%) |
|
(19.2 |
%) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Other (5) |
|
|
|
|
|
|
|
|
|
|
|
Digital Subscription Revenues (1) |
$ |
16,509 |
|
$ |
1,251 |
|
$ |
17,760 |
|
$ |
19,378 |
|
(14.8 |
%) |
|
(8.3 |
%) |
Workshops + Digital Fees (2) |
$ |
6,166 |
|
$ |
471 |
|
$ |
6,637 |
|
$ |
9,374 |
|
(34.2 |
%) |
|
(29.2 |
%) |
Subscription Revenues (3) |
$ |
22,675 |
|
$ |
1,723 |
|
$ |
24,398 |
|
$ |
28,752 |
|
(21.1 |
%) |
|
(15.1 |
%) |
Product Sales and Other (4) |
$ |
4,173 |
|
$ |
230 |
|
$ |
4,403 |
|
$ |
5,184 |
|
(19.5 |
%) |
|
(15.1 |
%) |
Total Revenues |
$ |
26,848 |
|
$ |
1,952 |
|
$ |
28,800 |
|
$ |
33,936 |
|
(20.9 |
%) |
|
(15.1 |
%) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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, including
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) “Subscription
Revenues” equal “Digital Subscription Revenues" plus “Workshops +
Digital Fees”. |
(4) “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 Other reportable segment,
franchise fees with respect to commitment plans and royalties. |
(5) Represents
Australia, New Zealand, emerging markets and franchise
revenues. |
|
|
|
|
|
|
|
|
|
|
|
|
|
WW INTERNATIONAL, INC. AND SUBSIDIARIES |
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES |
(IN THOUSANDS, EXCEPT PERCENTAGES) |
UNAUDITED |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Q4 2022 Variance |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2022 Constant Currency |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2022 |
|
|
|
2022 |
|
|
Q4 2022 |
|
Q4 2021 |
|
|
|
Adjusted |
|
|
|
Adjusted |
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted |
|
|
|
|
|
|
|
2022 |
|
vs |
|
2022 |
|
|
vs |
|
|
|
|
|
|
|
|
Currency |
|
Constant |
|
Constant |
|
|
|
|
|
|
|
vs |
|
2021 |
|
vs |
|
2021 |
|
|
GAAP |
|
Adjustment |
|
Adjusted |
|
Adjustment |
Currency |
|
Currency |
|
GAAP |
|
Adjustment |
|
Adjusted |
|
2021 |
|
Adjusted |
|
2021 |
|
Adjusted |
Selected Financial Data |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gross Profit |
$ |
126,990 |
|
|
$ |
3,128 |
|
(1) |
$ |
130,118 |
|
|
$ |
6,255 |
|
$ |
133,245 |
|
|
$ |
136,374 |
|
|
$ |
168,857 |
|
|
$ |
326 |
|
(5) |
$ |
169,184 |
|
|
(24.8 |
%) |
|
(23.1 |
%) |
|
(21.1 |
%) |
|
(19.4 |
%) |
Gross Margin |
|
56.7 |
% |
|
|
|
|
58.1 |
% |
|
|
|
|
57.2 |
% |
|
|
58.5 |
% |
|
|
61.2 |
% |
|
|
|
|
61.3 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Selling, General and Administrative Expenses |
$ |
70,520 |
|
|
$ |
(14,223 |
) |
(2) |
$ |
56,297 |
|
|
$ |
1,437 |
|
$ |
71,957 |
|
|
$ |
57,733 |
|
|
$ |
61,998 |
|
|
$ |
(235 |
) |
(6) |
$ |
61,763 |
|
|
13.7 |
% |
|
(8.9 |
%) |
|
16.1 |
% |
|
(6.5 |
%) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating (Loss) Income |
$ |
(50,756 |
) |
|
$ |
74,918 |
|
(3) |
$ |
24,162 |
|
|
$ |
724 |
|
$ |
(50,032 |
) |
|
$ |
27,197 |
|
(4) |
$ |
54,058 |
|
|
$ |
562 |
|
(7) |
$ |
54,620 |
|
|
(193.9 |
%) |
|
(55.8 |
%) |
|
(192.6 |
%) |
|
(50.2 |
%) |
Operating (Loss) Income Margin |
|
-22.7 |
% |
|
|
|
|
10.8 |
% |
|
|
|
|
-21.5 |
% |
|
|
11.7 |
% |
|
|
19.6 |
% |
|
|
|
|
19.8 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Note: Totals may not sum due to rounding. |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) |
Excludes the net impact of $1,798 of charges associated with the
Company's previously disclosed 2023 restructuring plan, $2,075 of
charges associated with the Company's previously disclosed 2022
restructuring plan, the reversal of $132 of charges associated with
the Company's previously disclosed 2021 organizational
restructuring plan and the reversal of $613 of charges associated
with the Company's previously disclosed 2020 organizational
restructuring plan. |
(2) |
Excludes the net impact of $11,810 of charges associated with the
Company's previously disclosed 2023 restructuring plan, $2,432 of
charges associated with the Company's previously disclosed 2022
restructuring plan, the reversal of $10 of charges associated with
the Company's previously disclosed 2021 organizational
restructuring plan and the reversal of $8 of charges associated
with the Company's previously disclosed 2020 organizational
restructuring plan. |
(3) |
Excludes (i) the impact of impairment charges of the Company's
franchise rights acquired of $25,739, $19,657, $8,275 and $1,872
related to its United States, Canada, United Kingdom and Australia
units of account, respectively, and an impairment charge of the
Company's goodwill related to its Republic of Ireland reporting
unit of $2,023 and (ii) the net impact of (w) $1,798 of charges and
$11,810 of charges associated with the Company's previously
disclosed 2023 restructuring plan recorded to cost of subscription
revenues and selling, general and administrative expenses,
respectively, (x) $2,075 of charges and $2,432 of charges
associated with the Company's previously disclosed 2022
restructuring plan recorded to cost of subscription revenues and
selling, general and administrative expenses, respectively, (y) the
reversal of $132 of charges and $10 of charges associated with the
Company's previously disclosed 2021 organizational restructuring
plan recorded to cost of subscription revenues and selling, general
and administrative expenses, respectively, and (z) the reversal of
$613 of charges and $8 of charges associated with the Company's
previously disclosed 2020 organizational restructuring plan
recorded to cost of subscription revenues and selling, general and
administrative expenses, respectively. |
(4) |
Includes $2.311 of currency adjustment associated with the
impairment charges of the Company's franchise rights acquired of
$19,657, $8,275 and $1,872 related to its Canada, United Kingdom
and Australia units of account, respectively, and the impairment
charge of the Company's goodwill related to its Republic of Ireland
reporting unit of $2,023. |
(5) |
Excludes $326 of charges associated with the Company’s previously
disclosed 2021 organizational restructuring plan. |
(6) |
Excludes the net impact of $309 of charges associated
with the Company’s previously disclosed 2021 organizational
restructuring plan and the reversal of $74 of charges associated
with the Company’s previously disclosed 2020 organizational
restructuring plan. |
(7) |
Excludes the net impact of (i) $326 of charges and $309 of charges
associated with the Company's previously disclosed 2021
organizational restructuring plan recorded to cost of subscription
revenues and selling, general and administrative expenses,
respectively, and (ii) the reversal of $74 of charges associated
with the Company's previously disclosed 2020 organizational
restructuring plan recorded to cost of subscription revenues. |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
WW INTERNATIONAL, INC. AND SUBSIDIARIES |
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES |
(IN THOUSANDS, EXCEPT PERCENTAGES) |
UNAUDITED |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Full Year 2022 Variance |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2022 Constant Currency |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2022 |
|
|
|
|
2022 |
|
|
|
Full Year 2022 |
|
Full Year 2021 |
|
|
|
Adjusted |
|
|
|
Adjusted |
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted |
|
|
|
|
|
|
|
2022 |
|
vs |
|
2022 |
|
vs |
|
|
|
|
|
|
|
|
Currency |
|
Constant |
|
Constant |
|
|
|
|
|
|
|
vs |
|
2021 |
|
|
vs |
|
2021 |
|
|
GAAP |
|
Adjustment |
|
Adjusted |
|
Adjustment |
Currency |
|
Currency |
|
GAAP |
|
Adjustment |
|
Adjusted |
|
2021 |
|
Adjusted |
|
2021 |
|
Adjusted |
Selected Financial Data |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gross Profit |
$ |
622,400 |
|
|
$ |
6,981 |
|
(1) |
$ |
629,381 |
|
|
$ |
27,402 |
|
$ |
649,802 |
|
|
$ |
656,783 |
|
|
$ |
726,355 |
|
|
$ |
15,426 |
|
(5) |
$ |
741,782 |
|
|
(14.3 |
%) |
|
(15.2 |
%) |
|
(10.5 |
%) |
|
(11.5 |
%) |
Gross Margin |
|
59.8 |
% |
|
|
|
|
60.5 |
% |
|
|
|
|
60.2 |
% |
|
|
60.8 |
% |
|
|
59.9 |
% |
|
|
|
|
61.2 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Selling, General and Administrative Expenses |
$ |
263,840 |
|
|
$ |
(32,730 |
) |
(2) |
$ |
231,110 |
|
|
$ |
5,437 |
|
$ |
269,277 |
|
|
$ |
236,547 |
|
|
$ |
268,614 |
|
|
$ |
(4,502 |
) |
(6) |
$ |
264,112 |
|
|
(1.8 |
%) |
|
(12.5 |
%) |
|
0.2 |
% |
|
(10.4 |
%) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating (Loss) Income |
$ |
(282,950 |
) |
$ |
436,438 |
|
(3) |
$ |
153,488 |
|
|
$ |
9,660 |
|
$ |
(273,290 |
) |
$ |
167,620 |
|
(4) |
$ |
196,284 |
|
|
$ |
19,928 |
|
(7) |
$ |
216,212 |
|
|
(244.2 |
%) |
|
(29.0 |
%) |
|
(239.2 |
%) |
|
(22.5 |
%) |
Operating (Loss) Income Margin |
|
-27.2 |
% |
|
|
|
|
14.7 |
% |
|
|
|
|
-25.3 |
% |
|
|
15.5 |
% |
|
|
16.2 |
% |
|
|
|
|
17.8 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Note: Totals may not sum due to rounding. |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) |
Excludes the net impact of $1,798 of charges associated with the
Company's previously disclosed 2023 restructuring plan, $6,476 of
charges associated with the Company's previously disclosed 2022
restructuring plan, the reversal of $564 of charges associated with
the Company's previously disclosed 2021 organizational
restructuring plan and the reversal of $729 of charges associated
with the Company's previously disclosed 2020 organizational
restructuring plan. |
(2) |
Excludes the net impact of $11,810 of charges associated with the
Company's previously disclosed 2023 restructuring plan, $20,705 of
charges associated with the Company's previously disclosed 2022
restructuring plan, $223 of charges associated with the Company's
previously disclosed 2021 organizational restructuring plan and the
reversal of $8 of charges associated with the Company's previously
disclosed 2020 organizational restructuring plan. |
(3) |
Excludes (i) the impact of impairment charges of the Company's
franchise rights acquired of $324,030, $57,454, $8,275, $1,972 and
$1,872 related to its United States, Canada, United Kingdom, New
Zealand and Australia units of account, respectively, and
impairment charges of the Company's goodwill related to its
Republic of Ireland reporting unit and its Kurbo operations of
$2,023 and $1,101, respectively, and (ii) the net impact of (v)
$1,798 of charges and $11,810 of charges associated with the
Company's previously disclosed 2023 restructuring plan recorded to
cost of subscription revenues and selling, general and
administrative expenses, respectively, (w) $6,476 of charges and
$20,705 of charges associated with the Company's previously
disclosed 2022 restructuring plan recorded to cost of subscription
revenues and selling, general and administrative expenses,
respectively, (x) the reversal of $564 of charges associated with
the Company's previously disclosed 2021 organizational
restructuring plan recorded to cost of subscription revenues, (y)
$223 of charges associated with the Company's previously disclosed
2021 organizational restructuring plan recorded to selling, general
and administrative expenses and (z) the reversal of $729 of charges
and $8 of charges associated with the Company's previously
disclosed 2020 organizational restructuring plan recorded to cost
of subscription revenues and selling, general and administrative
expenses, respectively. |
(4) |
Includes $4,471 of currency adjustment associated with the
impairment charges of the Company's franchise rights acquired of
$57,454, $8,275, $1,972 and $1,872 related to its Canada, United
Kingdom, New Zealand and Australia units of account, respectively,
and the impairment charge of the Company's goodwill related to its
Republic of Ireland reporting unit of $2,023. |
(5) |
Excludes the net impact of $16,727 of charges associated with the
Company's previously disclosed 2021 organizational restructuring
plan and the reversal of $1,301 of charges associated with the
Company's previously disclosed 2020 organizational restructuring
plan. |
(6) |
Excludes the net impact of $4,807 of charges associated with the
Company's previously disclosed 2021 organizational restructuring
plan and the reversal of $305 of charges associated with the
Company's previously disclosed 2020 organizational restructuring
plan. |
(7) |
Excludes the net impact of (i) $16,727 of charges and $4,807 of
charges associated with the Company's previously disclosed 2021
organizational restructuring plan recorded to cost of subscription
revenues and selling, general and administrative expenses,
respectively, and (ii) the reversal of $1,301 of charges and $305
of charges associated with the Company's previously disclosed 2020
organizational restructuring plan recorded to cost of subscription
revenues and selling, general and administrative expenses,
respectively. |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
WW INTERNATIONAL, INC. AND SUBSIDIARIES |
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES |
(IN THOUSANDS) |
UNAUDITED |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended |
|
|
Twelve Months Ended |
|
|
|
December 31, |
|
January 1, |
|
|
December 31, |
|
January 1, |
|
|
|
2022 |
|
2022 |
|
|
2022 |
|
2022 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net (Loss) Income |
$ (32,500 |
) |
|
$ 29,929 |
|
|
|
$ (251,403 |
) |
|
$ 66,892 |
|
|
Interest |
|
22,304 |
|
|
19,210 |
|
|
|
81,141 |
|
|
87,909 |
|
|
Taxes |
|
(38,948 |
) |
|
3,285 |
|
|
|
(114,379 |
) |
|
9,773 |
|
|
Depreciation and Amortization |
10,407 |
|
|
11,017 |
|
|
|
42,348 |
|
|
45,482 |
|
|
Stock-based Compensation |
2,590 |
|
|
4,752 |
|
|
|
12,952 |
|
|
21,348 |
|
|
EBITDAS |
$ (36,147 |
) |
|
$ 68,193 |
|
|
|
$ (229,341 |
) |
|
$ 231,405 |
|
|
Franchise Rights Acquired and Goodwill Impairments |
57,566 |
|
(1) |
- |
|
|
|
396,727 |
|
(2) |
- |
|
|
2023 Plan Restructuring Charges (3) |
13,608 |
|
|
- |
|
|
|
13,608 |
|
|
- |
|
|
2022 Plan Restructuring Charges (4) |
4,507 |
|
|
- |
|
|
|
27,181 |
|
|
- |
|
|
2021 Plan Restructuring Charges (5) |
(142 |
) |
|
636 |
|
|
|
(341 |
) |
|
21,534 |
|
|
2020 Plan Restructuring Charges (6) |
(621 |
) |
|
(74 |
) |
|
|
(737 |
) |
|
(1,606 |
) |
|
Early Extinguishment of Debt (7) |
- |
|
|
1,183 |
|
|
|
- |
|
|
30,352 |
|
|
Adjusted EBITDAS |
$ 38,771 |
|
|
$ 69,938 |
|
|
|
$ 207,097 |
|
|
$ 281,684 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Note: Totals may not sum due to rounding. |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) |
Impairment charges of the Company's franchise rights acquired of
$25,739, $19,657, $8,275 and $1,872 related to its United States,
Canada, United Kingdom and Australia units of account,
respectively, and an impairment charge of the Company's goodwill
related to its Republic of Ireland reporting unit of $2,023. |
|
|
(2) |
Impairment charges of the Company's franchise rights acquired of
$324,030, $57,454, $8,275, $1,972 and $1,872 related to its United
States, Canada, United Kingdom, New Zealand and Australia units of
account, respectively, and impairment charges of the Company's
goodwill related to its Republic of Ireland reporting unit and
Kurbo operations of $2,023 and $1,101, respectively. |
|
|
(3) |
Charges associated with the Company's previously disclosed 2023
restructuring
plan. |
|
|
(4) |
Charges associated with the Company's previously disclosed 2022
restructuring
plan. |
|
|
(5) |
Charges or the reversal of charges, as applicable, associated with
the Company's previously disclosed 2021 organizational
restructuring plan. |
|
|
(6) |
The reversal of charges associated with the Company's previously
disclosed 2020 organizational restructuring
plan. |
|
|
(7) |
Charges associated with the Company's previously disclosed April
2021 debt refinancing and voluntary debt
prepayments. |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
WW INTERNATIONAL, INC. AND SUBSIDIARIES |
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES |
(IN THOUSANDS, EXCEPT RATIO) |
UNAUDITED |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Trailing Twelve |
|
|
|
Q1 2022 |
|
Q2 2022 |
|
Q3 2022 |
|
Q4 2022 |
|
|
Months |
|
Net Debt to Adjusted EBITDAS |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Income (Loss) |
$ |
(8,243 |
) |
|
$ |
(4,623 |
) |
|
$ |
(206,036 |
) |
|
$ |
(32,500 |
) |
|
|
$ |
(251,403 |
) |
|
Interest |
|
18,671 |
|
|
|
19,255 |
|
|
|
20,912 |
|
|
|
22,304 |
|
|
|
|
81,141 |
|
|
Taxes |
|
|
(1,802 |
) |
|
|
(2,879 |
) |
|
|
(70,749 |
) |
|
|
(38,948 |
) |
|
|
|
(114,379 |
) |
|
Depreciation and Amortization |
|
10,759 |
|
|
|
10,637 |
|
|
|
10,544 |
|
|
|
10,407 |
|
|
|
|
42,348 |
|
|
Stock-based Compensation |
|
4,700 |
|
|
|
2,286 |
|
|
|
3,376 |
|
|
|
2,590 |
|
|
|
|
12,952 |
|
|
|
EBITDAS |
$ |
24,085 |
|
|
$ |
24,676 |
|
|
$ |
(241,953 |
) |
|
$ |
(36,147 |
) |
|
|
$ |
(229,341 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Franchise Rights Acquired and Goodwill Impairments |
|
– |
|
|
|
26,420 |
|
(1) |
|
312,741 |
|
(2) |
|
57,566 |
|
(3) |
|
|
396,727 |
|
|
2023 Plan Restructuring Charges (4) |
|
– |
|
|
|
– |
|
|
|
– |
|
|
|
13,608 |
|
|
|
|
13,608 |
|
|
2022 Plan Restructuring Charges (5) |
|
– |
|
|
|
19,117 |
|
|
|
3,557 |
|
|
|
4,507 |
|
|
|
|
27,181 |
|
|
2021 Plan Restructuring Charges (6) |
|
265 |
|
|
|
(566 |
) |
|
|
103 |
|
|
|
(142 |
) |
|
|
|
(341 |
) |
|
2020 Plan Restructuring Charges (7) |
|
(116 |
) |
|
|
– |
|
|
|
– |
|
|
|
(621 |
) |
|
|
|
(737 |
) |
|
|
Adjusted EBITDAS |
$ |
24,234 |
|
|
$ |
69,647 |
|
|
$ |
74,448 |
|
|
$ |
38,771 |
|
|
|
$ |
207,097 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Debt |
|
|
|
|
|
|
|
|
|
$ |
1,422,284 |
|
|
Less: Cash |
|
|
|
|
|
|
|
|
|
|
178,326 |
|
|
|
Net Debt |
|
|
|
|
|
|
|
|
|
$ |
1,243,958 |
|
|
|
Net Debt to Adjusted EBITDAS |
|
|
|
|
|
|
|
|
|
6.0 X |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Note: Totals may not sum due to rounding. |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) |
Impairment charges of the Company's franchise rights acquired of
$24,485 and $834 related to its Canada and New Zealand units of
account, respectively, and an impairment charge of the Company's
goodwill related to its Kurbo operations of $1,101. |
(2) |
Impairment charges of the Company's franchise rights acquired of
$298,291, $13,312 and $1,138 related to its United States, Canada
and New Zealand units of account, respectively. |
(3) |
Impairment charges of the Company's franchise rights acquired of
$25,739, $19,657, $8,275 and $1,872 related to its United States,
Canada, United Kingdom and Australia units of account,
respectively, and an impairment charge of the Company's goodwill
related to its Republic of Ireland reporting unit of $2,023. |
(4) |
Charges associated with the Company's previously disclosed 2023
restructuring plan. |
(5) |
Charges associated with the Company's previously disclosed 2022
restructuring plan. |
(6) |
Charges or the reversal of charges, as applicable, associated with
the Company's previously disclosed 2021 organizational
restructuring plan. |
(7) |
The reversal of charges associated with the Company's previously
disclosed 2020 organizational restructuring
plan. |
For more information, contact:Investors:Corey
Kinger corey.kinger@ww.com
Media:Kelsey Merkelkelsey.merkel@ww.com
WW (NASDAQ:WW)
Historical Stock Chart
From Jun 2024 to Jul 2024
WW (NASDAQ:WW)
Historical Stock Chart
From Jul 2023 to Jul 2024