Revenue, net income fall again at GNC, company announces
Closing of 87 corporate stores is the biggest cause of the decreases, while ecommerce sales disappoint executives.
Revenue and net income at GNC Holdings Inc. again dropped compared to first-quarter results a year ago—and those results were lower than the previous year’s.
The global supplements company released its Q1 financials Thursday morning:
Total revenue was $564.8 million, down 7% from 2018’s $607.5 million. Revenue in the first quarter of 2017 was $654.9 million, 13.7% higher than the current amount.
A net loss of $15.3 million, compared with net income of $6.2 million—a drop of 346.8%. The company saw net income of $24.7 million in Q1 of 2017.
Adjusted net income was $19 million for this quarter, compared with $20.1 million a year ago and $26 million in 2017.
Gross profit was 36% of sales, compared with 34.1% a year ago.
Domestic same-store sales decreased 1.6% from a year ago. First-quarter 2018 same-store sales were 0.5% higher than in 2017.
During the quarter, which ended March 31, GNC closed 87 corporate-owned stores. Those closings triggered about $14 million of the quarter’s revenue loss and a drop of 1.6% in same-store sales that translates to a $6.2 million loss of revenue, the company reported.
The company was pleased with its EBITDA margin of 11%, CEO Ken Martindale said during the morning earnings call. He pointed out that comparable sales at domestic franchise stores rose for the first time in years.
Martindale said the company expected same-store sales to drop, but the 1% growth in ecommerce sales was disappointing.