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Sales, profit continue to fall at The Vitamin Shoppe despite improvement efforts

Article-Sales, profit continue to fall at The Vitamin Shoppe despite improvement efforts

National dietary supplements retailer cancels Thursday’s scheduled call, issues press releases about its acquisition and earnings instead.

The Vitamin Shoppe Inc. reported on Thursday that its second-quarter net sales dropped 7.6%, to $270.9 million, from the same time in 2018.

Gross profit was $90.3 million, 4.1% lower than it was a year ago. The profit margin was 33.3%, up slightly from 32.2% in 2018.

The second quarter ended on June 29.

The dietary supplements retailer canceled a call with investors that had been scheduled for 8:30 a.m. EDT. Earnings and the news that the company will be acquired by Liberty Tax were announced via press releases. The buyout is expected to close in the fourth quarter.

The press release regarding Q2 earnings did not include any comments from company executives. However, in a letter to vendors regarding the acquisition, CEO Sharon Leite wrote:

“We believe this transaction will enhance the ability of The Vitamin Shoppe to execute on its strategic plan, thus strengthening its partnerships with vendors. Our leadership team is confident that our new financial partners share in our vision to innovation and win market share in the fast-growing health and wellness sector.”

Leite became the company's CEO on August 27.

In other results for the second quarter, Vitamin Shoppe reported a net loss of $3.6 million, compared with net income of $5.3 million in Q2 2108. Adjusted income was $4.8 million for 2019 and $7.3 million a year ago, a 21% decrease.

Sales and profit during the first two quarter of 2019 were universally lower, as well:

  • Net sales of $544.2 million were 6% lower than in 2018.
  • Gross profit was $185.1 million, down 1.2% from 2018.
  • A net loss of $73,000 after net income of $3.3 million in 2018.
  • Operations income was $2.6 million, a 71% drop from 2018’s $9 million.

Vitamin Shoppe, which had 765 stores at the end of the second quarter, announced in February that it would be closing 60 to 80 stores in the next three years. At the end of fiscal 2018, the company reported mixed results:

  • Net sales of $1.11 billion in 2018 were 3 percent lower than in 2017.
  • Net income of $13.5 million, compared with a loss of $235.5 million in 2017.
  • Total income loss was $3.8 million, an improvement over 2017’s loss of $252.2 million.

The first quarter of 2019 ended with net income of $3.5 million, up from a $3.86 million loss in Q1 2018.

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