Ww International, Inc 8-K/A, filed May 9, 2024
Ww International, Inc. (WW)
About this 8-K/A
Ww International, Inc filed this 8-K/A on May 9, 2024, reporting on events of May 2, 2024.
Items reported
- Item 2.02: Financial results
- Item 9.01: Financial statements and exhibits
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
(Amendment No. 1)
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
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| Item 2.02. | Results of Operations and Financial Condition. |
On May 2, 2024, WW International, Inc. (the “Company”) issued an earnings release (the “Earnings Release”) announcing its financial results for the first quarter ended March 30, 2024 and furnished the Earnings Release with a Current Report on Form 8-K (the “Initial 8-K”). The Earnings Release furnished with the Initial 8-K incorrectly presented the Company’s Clinical End of Period Subscribers, Total End of Period Subscribers, Clinical Paid Weeks, and Total Paid Weeks for the first quarter ended March 30, 2024 and related percentage changes versus the prior year period, as applicable.
Clinical End of Period Subscribers and Total End of Period Subscribers were both overstated by 3,991 subscribers, and Clinical Paid Weeks and Total Paid Weeks were both overstated by 17,210 Paid Weeks, as follows:
| Corrected metrics | Previously reported metrics in Initial 8-K | |||
Clinical End of Period of Subscribers |
87 thousand | 91 thousand | ||
Total End of Period Subscribers |
4.004 million | 4.008 million | ||
Clinical Paid Weeks |
1.038 million | 1.056 million | ||
Total Paid Weeks |
51.782 million | 51.799 million |
These corrections resulted from a de minimis number of subscribers that had elected to transition their Clinical subscription to either a Digital or a Workshops + Digital subscription being double-counted in connection with certain reporting of operational statistics from a new platform. Upon identifying the issue, the Company promptly assessed the applicable platform and related reporting functionality, and revised its reporting framework to ensure the accuracy of its reporting of End of Period Subscribers and Paid Weeks going forward.
A copy of the corrected Earnings Release is furnished as Exhibit 99.1 to this Amendment. The Company also intends to file an amendment to its Quarterly Report on Form 10-Q for the fiscal quarter ended March 30, 2024 to correct the same information.
The information contained in Item 2.02 of this Current Report on Form 8-K/A, including the text of the press release attached as Exhibit 99.1, is being furnished and shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that Section. The information contained in Items 2.02 and 9.01 of this Current Report on Form 8-K/A shall not be incorporated by reference into any registration statement or other document or filing under the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly set forth by specific reference in such filing.
| Item 9.01. | Financial Statements and Exhibits. |
(d) Exhibits.
Exhibit |
Description | |
| Exhibit 99.1 | Corrected Press Release dated May 2, 2024. | |
| Exhibit 104 | The cover page from this Current Report on Form 8-K/A, formatted in Inline XBRL. | |
2
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| WW INTERNATIONAL, INC. | ||||||
| DATED: May 9, 2024 | By: | /s/ Heather Stark | ||||
| Name: | Heather Stark | |||||
| Title: | Chief Financial Officer | |||||
3
Exhibit 99.1
For more information, contact:
Investors:
Corey Kinger
corey.kinger@ww.com
Media:
media@ww.com
WW International, Inc. Announces First Quarter 2024 Results
NOTE: The accompanying release updates the release previously issued by the Company on May 2, 2024, in order to correct the presentation of the Company’s Clinical End of Period Subscribers, Total End of Period Subscribers, Clinical Paid Weeks, and Total Paid Weeks for the first quarter ended March 30, 2024 and related percentage changes versus the prior year period, as applicable. No other information was incorrectly presented.
| • | End of Period Subscribers of 4.0 million, including 87 thousand End of Period Clinical Subscribers |
| • | Revenues of $206.5 million |
| • | Gross margin of 66.7%; excluding the net impact of restructuring charges related to prior year restructuring plans, adjusted gross margin of 67.9% |
| • | Operating Loss of $269.3 million primarily due to $258.0 million in non-cash intangible impairment charges for franchise rights acquired; excluding such impairment charges and the net impact of restructuring charges related to prior year restructuring plans, adjusted operating loss of $5.6 million |
| • | Provides update to full year fiscal 2024 guidance |
NEW YORK (May 2, 2024) – WW International, Inc. (NASDAQ: WW) (“WeightWatchers,” “WW,” or the “Company”) today announced its results for the first quarter of fiscal 2024.
“We delivered solid performance in the first quarter with end of period subscribers of 4.0 million, improved retention and engagement in our core business, and continued strong growth in our clinical business with 87 thousand end of period clinical subscribers,” said Sima Sistani, the Company’s CEO. “We continue to expect to end the year with total subscribers in the range of 3.8 million to 4.0 million, including between 140 thousand and 160 thousand subscribers to our new WeightWatchers Clinic. We are executing on our plan by returning WeightWatchers to profitable growth while transforming our business model for the future.”
“We are maintaining our revenue guidance for 2024, including a return to year-over-year growth in subscription revenues,” said Heather Stark, the Company’s CFO. “We are operating more efficiently, demonstrated by record gross margin and our outlook for strong adjusted operating income growth.”
Q1 2024 Consolidated Results
| % Change | ||||||||||||||||
| Three Months Ended | Adjusted for | |||||||||||||||
| March 30, | April 1, | Constant | ||||||||||||||
| 2024 | 2023 | % Change | Currency(1) | |||||||||||||
| (in millions except percentages and per share amounts) |
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| Subscription Revenues, net |
$ | 204.1 | $ | 211.0 | (3.3 | %) | (3.7 | %) | ||||||||
| Other Revenues, net(2) |
2.5 | 30.9 | (91.9 | %) | (92.0 | %) | ||||||||||
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| Revenues, net |
$ | 206.5 | $ | 241.9 | (14.6 | %) | (14.9 | %) | ||||||||
| Gross Profit |
$ | 137.8 | $ | 119.5 | 15.3 | % | 14.8 | % | ||||||||
| Non-GAAP Adjustments(1) |
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| Net Restructuring Charges(3) |
2.5 | 18.6 | ||||||||||||||
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| Adjusted Gross Profit(1) |
$ | 140.3 | $ | 138.1 | 1.5 | % | 1.1 | % | ||||||||
| Operating Loss |
($ | 269.3 | ) | ($ | 28.6 | ) | 100.0 | %* | 100.0 | %* | ||||||
| Non-GAAP Adjustments(1) |
||||||||||||||||
| Franchise Rights Acquired Impairments |
258.0 | — | ||||||||||||||
| Net Restructuring Charges(3) |
5.7 | 22.7 | ||||||||||||||
| Acquisition Transaction Costs |
— | 3.7 | ||||||||||||||
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| Adjusted Operating Loss(1) |
($ | 5.6 | ) | ($ | 2.2 | ) | 100.0 | %* | 100.0 | %* | ||||||
| Net Loss |
($ | 347.9 | ) | ($ | 118.7 | ) | 100.0 | %* | 100.0 | %* | ||||||
| EPS |
($ | 4.39 | ) | ($ | 1.68 | ) | 100.0 | %* | 100.0 | %* | ||||||
| Total Paid Weeks |
51.8 | 51.0 | 1.6 | % | N/A | |||||||||||
| Digital(4) Paid Weeks |
42.3 | 40.8 | 3.7 | % | N/A | |||||||||||
| Workshops + Digital(5) Paid Weeks |
8.4 | 10.2 | (17.0 | %) | N/A | |||||||||||
| Clinical(6) Paid Weeks |
1.0 | — | N/A | N/A | ||||||||||||
| End of Period Subscribers(7) |
4.0 | 4.0 | (0.5 | %) | N/A | |||||||||||
| Digital Subscribers |
3.3 | 3.3 | 0.7 | % | N/A | |||||||||||
| Workshops + Digital Subscribers |
0.6 | 0.8 | (16.7 | %) | N/A | |||||||||||
| Clinical Subscribers |
0.1 | — | N/A | N/A | ||||||||||||
Note: Totals may not sum due to rounding.
| * | Note: Percentage in excess of 100.0% and not meaningful. |
| (1) | See “Reconciliation of Non-GAAP Financial Measures” attached to this release for further detail on adjustments to GAAP financial measures. |
| (2) | “Other Revenues, net” (formerly known as “Product Sales and Other, net”) consist of revenues from licensing and publishing, franchise fees with respect to commitment plans and royalties, and other revenues. Prior to fiscal 2024, “Other Revenues, net” included sales of consumer products. |
| (3) | 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. |
| (4) | “Digital” refers to providing subscriptions to the Company’s digital product offerings. |
| (5) | “Workshops + Digital” refers to providing subscriptions for unlimited access to the Company’s workshops combined with the Company’s digital subscription product offerings. |
| (6) | “Clinical” refers to providing subscriptions to the Company’s clinical product offerings provided by WeightWatchers Clinic (formerly referred to as Sequence). |
| (7) | “Subscribers” refers to Digital subscribers, Workshops + Digital subscribers, and Clinical subscribers who participate in recurring bill programs in Company-owned operations. |
Q1 2024 Business and Financial Highlights
| • | End of Period Subscribers in Q1 2024 were down 0.5% versus the prior year period. Q1 2024 End of Period Workshops + Digital Subscribers decreased 16.7% versus the prior year period. Q1 2024 End of Period Digital Subscribers increased 0.7% versus the prior year period. Q1 2024 End of Period Clinical Subscribers were 87 thousand. |
| • | Total Paid Weeks in Q1 2024 were up 1.6% versus the prior year period, driven by the Digital business and the inclusion of 1.0 million Clinical Paid Weeks. Q1 2024 Digital Paid Weeks increased 3.7% versus the prior year period. Q1 2024 Workshops + Digital Paid Weeks decreased 17.0% versus the prior year period. |
| • | Revenues in Q1 2024 were $206.5 million. On a constant currency basis, Q1 2024 revenues decreased 14.9% versus the prior year period. |
| • | Subscription Revenues in Q1 2024 were $204.1 million. On a constant currency basis, these revenues decreased 3.7% versus the prior year period. Subscription Revenues included $18.8 million of Clinical Subscription Revenues. |
| • | Other Revenues in Q1 2024 were $2.5 million. On a constant currency basis, these revenues decreased 92.0% versus the prior year period driven by the wind down of the consumer products business. |
| • | Gross Profit in Q1 2024 was $137.8 million, compared to $119.5 million in the prior year period. Adjusted gross profit in Q1 2024, which excluded the net impact of $2.5 million of restructuring charges related to prior year restructuring plans, was $140.3 million. Adjusted gross profit in Q1 2023, which excluded the net impact of $18.6 million of restructuring charges, was $138.1 million. |
| • | Gross Margin in Q1 2024 was 66.7%, as compared to 49.4% in the prior year period. Adjusted gross margin in Q1 2024 was 67.9%, up from an adjusted gross margin of 57.1% in the prior year period, primarily driven by actions to reduce the fixed cost base and mix shift within the business. |
| • | Non-Cash Intangible Impairment Charges: During Q1 2024, the Company recorded non-cash impairment charges of franchise rights acquired totaling $258.0 million. These impairments were primarily driven by an increase in the Company’s weighted average cost of capital reflecting market factors. |
| • | Operating Loss in Q1 2024 was $269.3 million, compared to operating loss of $28.6 million in the prior year period. Adjusted operating loss in Q1 2024, which excluded $258.0 million of non-cash intangible impairment charges and the net impact of $5.7 million of restructuring charges related to prior year restructuring plans, was $5.6 million. Adjusted operating loss in Q1 2023, which excluded the net impact of $22.7 million of restructuring charges and the impact of $3.7 million of acquisition transaction costs, was $2.2 million. |
| • | Income Tax Expense in Q1 2024 was $55.4 million, which reflected the impact of an unusually high negative annual effective tax rate driven by a valuation allowance and small pretax loss reflected in the Company’s full year fiscal 2024 guidance. In the prior year period, income tax expense was $67.6 million. |
| • | Net Loss in Q1 2024 was $347.9 million compared to net loss of $118.7 million in the prior year period. |
| • | Diluted Net Loss per share in Q1 2024 was $4.39 compared to diluted net loss per share of $1.68 in the prior year period. |
| • | Certain items affect year-over-year comparability. |
| • | Q1 2024 diluted net loss per share incorporated the net negative impact of $4.33 per diluted share in the aggregate due to the following items: |
| • | $3.05 per diluted share negative impact of non-cash intangible impairment charges for franchise rights acquired. |
| • | $1.22 per diluted share negative tax impact arising from an unusually high negative annual effective tax rate as a result of a valuation allowance and small pretax loss reflected in the Company’s full year fiscal 2024 guidance. |
| • | $0.05 per diluted share net negative impact of restructuring charges related to prior year restructuring plans. |
| • | Q1 2023 diluted net loss per share incorporated the negative impact of $1.59 per diluted share in the aggregate due to the following items: |
| • | $0.24 per diluted share net negative impact of restructuring charges. |
| • | $1.30 per diluted share negative tax impact arising from an unusually high negative annual effective tax rate as a result of a valuation allowance and small pretax loss reflected in the Company’s full year fiscal 2023 guidance. |
| • | $0.05 per diluted share negative impact from acquisition transaction costs. |
Other Items
| • | Cash balance as of March 30, 2024 was $66.6 million. On that same date, the Company had no outstanding borrowings under its revolving credit facility. |
| • | Interest Rate Hedges: The Company’s interest rate swaps in effect as of the end of the first quarter of fiscal 2024 terminated on March 31, 2024. As of May 2, 2024, the Company had no active swaps in place. |
| • | 2023 Restructuring Plan: In connection with the previously announced 2023 restructuring plan, the Company recorded aggregate restructuring charges of $5.5 million in Q1 2024. |
| • | Reportable Segment Update: As previously disclosed, as a result of the continued evolution of the Company’s centralized organizational structure in fiscal 2023, and management’s 2024 strategic planning process, the Company’s reportable segments changed commencing with the first day of fiscal 2024 to one segment. |
Full Year Fiscal 2024 Guidance
The Company is providing the following update to full year fiscal 2024 guidance:
| • | Maintaining previously provided revenue guidance range of $830.0 million to $860.0 million, reflecting a $55 million year-over-year headwind from the strategic decision to wind down the Company’s low-margin consumer products business. |
| • | Operating loss is expected to be in the range of $163.7 million to $153.7 million; excluding the non-cash intangible impairment charges and net impact of restructuring charges recorded in the first quarter of fiscal 2024, adjusted operating income is expected to be in the range of $100.0 million to $110.0 million, which is consistent with previously provided operating income guidance that did not include the above impairment and restructuring charges. |
First Quarter 2024 Conference Call and Webcast
The 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, Chief Financial Officer, will discuss the first quarter of fiscal 2024 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, under Events and Presentations. Supplemental investor materials 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 Measures
The 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, operating loss 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 first quarter of fiscal 2024 to exclude (x) the impact of impairment charges for the Company’s franchise rights acquired related to its United States, Australia, New Zealand and United Kingdom units of account and (y) the net impact of charges associated with the Company’s previously disclosed 2023 restructuring plan (the “2023 plan”) and the Company’s previously disclosed 2022 restructuring plan (the “2022 plan”); and (ii) the first quarter of fiscal 2023 to exclude (x) the net impact of (a) charges associated with the 2023 plan, (b) charges associated with the 2022 plan or the reversal of certain of the charges associated with the 2022 plan, as applicable, (c) the reversal of certain of the charges associated with the Company’s previously disclosed 2021 organizational restructuring plan (the “2021 plan”), and (d) the reversal of certain of the charges associated with the Company’s previously disclosed 2020 organizational restructuring plan (the “2020 plan”); and (y) the impact of certain non-recurring transaction costs in connection with the acquisition of Sequence. The Company generally refers to such non-GAAP measures as excluding or adjusting for the impact of franchise rights acquired impairments, the net impact of restructuring charges, and the impact of acquisition transaction costs, as applicable. 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 certain non-recurring transaction costs in connection with the acquisition of Sequence (“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. A reconciliation of the forward-looking full year EBITDAS outlook to net income cannot be provided without unreasonable effort because of the inherent difficulty of accurately forecasting the occurrence and financial impact of the various adjusting items necessary for such reconciliation that have not yet occurred, are out of the Company’s control, or cannot be reasonably predicted. For the same reasons, the Company is unable to assess the probable significance of the unavailable information, which could have a material impact on its future GAAP financial results.
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 is not meant to 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 titled 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 programs. For 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 programs. 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, any 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: competition from other weight management and health 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 be a leader in the rapidly evolving and increasingly competitive clinical weight management and weight loss market; 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 evolve its community offerings to meet the evolving tastes and preferences 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, affiliated provider entities, PCs’ healthcare
professionals, and other partners, including as a result of its acquisition of Weekend Health, Inc., doing business as Sequence (“Sequence”) (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 ability to successfully make acquisitions or enter into collaborations or joint ventures, including its ability to successfully integrate, operate or realize the anticipated benefits of such businesses, including with respect to Sequence; uncertainties related to a downturn in general economic conditions or consumer confidence, including as a result of the existing inflationary environment, rising interest rates, the potential impact of political and social unrest and increased volatility in the credit and capital markets; the seasonal nature of the Company’s business; the Company’s failure to maintain effective internal control over financial reporting; the impact of events that impede accessing resources or discourage or impede people from gathering with others; the early termination by the Company of leases; 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 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 successfully integrate and use artificial intelligence in its business; 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 war and terrorism; the outcomes of litigation or regulatory actions; the impact of existing and future laws and regulations; risks related to the Acquisition, including risks that the Acquisition may not achieve its intended results; risks related to the Company’s exposure to extensive and complex healthcare laws and regulations as a result of the Acquisition; and other risks and uncertainties, including those detailed from time to time in the Company’s periodic reports filed with the United States Securities and Exchange Commission (the “SEC”) (which are available on the SEC’s EDGAR database at www.sec.gov and via the Company’s website at corporate.ww.com). 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 SEC (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
| March 30, | December 30, | |||||||
| 2024 | 2023 | |||||||
| ASSETS |
||||||||
| CURRENT ASSETS |
||||||||
| Cash and cash equivalents |
$ | 66,615 | $ | 109,366 | ||||
| Receivables (net of allowances: March 30, 2024 - $1,887 and |
13,173 | 14,938 | ||||||
| Prepaid income taxes |
14,316 | 25,370 | ||||||
| Prepaid marketing and advertising |
2,982 | 10,149 | ||||||
| Prepaid expenses and other current assets |
19,888 | 19,651 | ||||||
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| TOTAL CURRENT ASSETS |
116,974 | 179,474 | ||||||
| Property and equipment, net |
19,068 | 19,741 | ||||||
| Operating lease assets |
50,133 | 52,272 | ||||||
| Franchise rights acquired |
128,213 | 386,526 | ||||||
| Goodwill |
242,258 | 243,441 | ||||||
| Other intangible assets, net |
58,031 | 63,208 | ||||||
| Deferred income taxes |
20,328 | 19,683 | ||||||
| Other noncurrent assets |
19,243 | 17,685 | ||||||
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| TOTAL ASSETS |
$ | 654,248 | $ | 982,030 | ||||
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| LIABILITIES AND TOTAL DEFICIT |
||||||||
| CURRENT LIABILITIES |
||||||||
| Portion of operating lease liabilities due within one year |
$ | 9,660 | $ | 9,613 | ||||
| Accounts payable |
22,514 | 18,507 | ||||||
| Salaries and wages payable |
52,769 | 79,096 | ||||||
| Accrued marketing and advertising |
15,789 | 18,215 | ||||||
| Accrued interest |
11,204 | 5,346 | ||||||
| Deferred acquisition payable |
16,000 | 16,500 | ||||||
| Other accrued liabilities |
23,019 | 22,610 | ||||||
| Income taxes payable |
62,088 | 1,609 | ||||||
| Deferred revenue |
36,004 | 33,966 | ||||||
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|
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| TOTAL CURRENT LIABILITIES |
249,047 | 205,462 | ||||||
| Long-term debt, net |
1,427,509 | 1,426,464 | ||||||
| Long-term operating lease liabilities |
51,256 | 53,461 | ||||||
| Deferred income taxes |
22,544 | 41,994 | ||||||
| Other |
16,191 | 15,743 | ||||||
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|
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| TOTAL LIABILITIES |
1,766,547 | 1,743,124 | ||||||
| TOTAL DEFICIT |
||||||||
| Common stock, $0 par value; 1,000,000 shares authorized; 130,048 |
0 | 0 | ||||||
| Treasury stock, at cost, 50,803 shares at March 30, 2024 and 50,859 |
(3,062,005 | ) | (3,064,628 | ) | ||||
| Retained earnings |
1,966,625 | 2,314,834 | ||||||
| Accumulated other comprehensive loss |
(16,919 | ) | (11,300 | ) | ||||
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|
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| TOTAL DEFICIT |
(1,112,299 | ) | (761,094 | ) | ||||
|
|
|
|
|
|||||
| TOTAL LIABILITIES AND TOTAL DEFICIT |
$ | 654,248 | $ | 982,030 | ||||
|
|
|
|
|
|||||
WW INTERNATIONAL, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
UNAUDITED
| Three Months Ended | ||||||||
| March 30, | April 1, | |||||||
| 2024 | 2023 | |||||||
| Subscription revenues, net (1) |
$ | 204,056 | $ | 211,032 | ||||
| Other revenues, net (2) |
2,492 | 30,863 | ||||||
|
|
|
|
|
|||||
| Revenues, net |
206,548 | 241,895 | ||||||
|
|
|
|
|
|||||
| Cost of subscription revenues (3) |
67,816 | 94,897 | ||||||
| Cost of other revenues |
932 | 27,487 | ||||||
|
|
|
|
|
|||||
| Cost of revenues |
68,748 | 122,384 | ||||||
|
|
|
|
|
|||||
| Gross profit |
137,800 | 119,511 | ||||||
| Marketing expenses |
90,162 | 88,234 | ||||||
| Selling, general and administrative expenses |
58,982 | 59,860 | ||||||
| Franchise rights acquired impairments |
257,988 | — | ||||||
|
|
|
|
|
|||||
| Operating loss |
(269,332 | ) | (28,583 | ) | ||||
| Interest expense |
24,727 | 22,846 | ||||||
| Other income, net |
(1,605 | ) | (330 | ) | ||||
|
|
|
|
|
|||||
| Loss before income taxes |
(292,454 | ) | (51,099 | ) | ||||
| Provision for income taxes |
55,448 | 67,580 | ||||||
|
|
|
|
|
|||||
| Net loss |
$ | (347,902 | ) | $ | (118,679 | ) | ||
|
|
|
|
|
|||||
| Net loss per share |
||||||||
| Basic |
$ | (4.39 | ) | $ | (1.68 | ) | ||
|
|
|
|
|
|||||
| Diluted |
$ | (4.39 | ) | $ | (1.68 | ) | ||
|
|
|
|
|
|||||
| Weighted average common shares outstanding |
||||||||
| Basic |
79,208 | 70,596 | ||||||
|
|
|
|
|
|||||
| Diluted |
79,208 | 70,596 | ||||||
|
|
|
|
|
|||||
| Note: | Totals may not sum due to rounding. |
| (1) | “Subscription revenues, net” consist of net “Digital Subscription Revenues”, net “Workshops + Digital Subscription Revenues” and net “Clinical Subscription Revenues”. “Digital Subscription Revenues” consist of the fees associated with subscriptions for the Company’s Digital offerings. “Workshops + Digital Subscription Revenues” consist of the fees associated with subscriptions for combined workshops and Digital offerings. “Clinical Subscription Revenues” consist of the fees associated with subscriptions for the Company’s Clinical offerings. |
| (2) | “Other revenues, net” (formerly known as “product sales and other, net”) consist of revenues from licensing and publishing, franchise fees with respect to commitment plans and royalties, and other revenues. Prior to fiscal 2024, “Other revenues, net” included sales of consumer products. |
| (3) | “Cost of subscription revenues” consists of cost of revenues and operating expenses for the Company’s Digital, Workshops + Digital and Clinical services. |
WW INTERNATIONAL, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(IN THOUSANDS)
UNAUDITED
| Three Months Ended | ||||||||
| March 30, | April 1, | |||||||
| 2024 | 2023 | |||||||
| Operating activities: |
||||||||
| Net loss |
$ | (347,902 | ) | $ | (118,679 | ) | ||
| Adjustments to reconcile net loss to cash used for operating activities: |
||||||||
| Depreciation and amortization |
10,403 | 11,989 | ||||||
| Amortization of deferred financing costs and debt discount |
1,254 | 1,254 | ||||||
| Impairment of franchise rights acquired |
257,988 | — | ||||||
| Impairment of intangible and long-lived assets |
24 | 171 | ||||||
| Share-based compensation expense |
2,402 | 2,669 | ||||||
| Deferred tax benefit |
(18,244 | ) | (3,110 | ) | ||||
| Allowance for doubtful accounts |
2,757 | (74 | ) | |||||
| Reserve for inventory obsolescence |
85 | 2,037 | ||||||
| Foreign currency exchange rate gain |
(1,304 | ) | (389 | ) | ||||
| Changes in cash due to: |
||||||||
| Receivables |
3,788 | (5,961 | ) | |||||
| Inventories |
79 | 7,994 | ||||||
| Prepaid expenses |
13,882 | 4,937 | ||||||
| Accounts payable |
4,130 | 2,728 | ||||||
| Accrued liabilities |
(26,393 | ) | 3,188 | |||||
| Deferred revenue |
2,321 | 3,405 | ||||||
| Other long term assets and liabilities, net |
(1,796 | ) | 734 | |||||
| Income taxes |
60,491 | 60,385 | ||||||
|
|
|
|
|
|||||
| Cash used for operating activities |
(36,035 | ) | (26,722 | ) | ||||
|
|
|
|
|
|||||
| Investing activities: |
||||||||
| Capital expenditures |
(476 | ) | (990 | ) | ||||
| Capitalized software and website development expenditures |
(4,333 | ) | (9,350 | ) | ||||
| Other items, net |
(1 | ) | (8 | ) | ||||
|
|
|
|
|
|||||
| Cash used for investing activities |
(4,810 | ) | (10,348 | ) | ||||
|
|
|
|
|
|||||
| Financing activities: |
||||||||
| Taxes paid related to net share settlement of equity awards |
(114 | ) | (205 | ) | ||||
| Proceeds from stock options exercised |
— | 7 | ||||||
| Cash paid for acquisitions |
(500 | ) | (500 | ) | ||||
| Other items, net |
(2 | ) | (26 | ) | ||||
|
|
|
|
|
|||||
| Cash used for financing activities |
(616 | ) | (724 | ) | ||||
|
|
|
|
|
|||||
| Effect of exchange rate changes on cash and cash equivalents |
(1,290 | ) | 315 | |||||
|
|
|
|
|
|||||
| Net decrease in cash and cash equivalents |
(42,751 | ) | (37,479 | ) | ||||
| Cash and cash equivalents, beginning of period |
109,366 | 178,326 | ||||||
|
|
|
|
|
|||||
| Cash and cash equivalents, end of period |
$ | 66,615 | $ | 140,847 | ||||
|
|
|
|
|
|||||
WW INTERNATIONAL, INC. AND SUBSIDIARIES
OPERATIONAL STATISTICS
(IN THOUSANDS, EXCEPT PERCENTAGES)
UNAUDITED
| Three Months Ended | ||||||||||||
| March 30, 2024 |
April 1, 2023 |
Variance | ||||||||||
| Paid Weeks (1) |
||||||||||||
| Digital Paid Weeks |
42,319 | 40,801 | 3.7% | |||||||||
| Workshops + Digital Paid Weeks |
8,425 | 10,151 | (17.0%) | |||||||||
| Clinical Paid Weeks |
1,038 | — | N/A | |||||||||
|
|
|
|
|
|
|
|||||||
| Total Paid Weeks |
51,782 | 50,952 | 1.6% | |||||||||
| End of Period Subscribers (2) |
||||||||||||
| End of Period Digital Subscribers |
3,277 | 3,254 | 0.7% | |||||||||
| End of Period Workshops + Digital Subscribers |
640 | 768 | (16.7%) | |||||||||
| End of Period Clinical Subscribers |
87 | — | N/A | |||||||||
|
|
|
|
|
|
|
|||||||
| Total End of Period Subscribers |
4,004 | 4,022 | (0.5%) | |||||||||
| 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 offerings; (ii) “Workshops + Digital Paid Weeks” is the total paid subscription weeks for combined workshops and Digital offerings; (iii) “Clinical Paid Weeks” is the total paid subscription weeks for the Company’s Clinical offerings; and (iv) “Total Paid Weeks” is the sum of Digital Paid Weeks, Workshops + Digital Paid Weeks and Clinical Paid Weeks. |
| (2) | 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 subscribers; (ii) “End of Period Workshops + Digital Subscribers” is the total number of subscribers that have access to combined workshops and Digital offerings; (iii) “End of Period Clinical Subscribers” is the total number of Clinical subscribers; and (iv) “End of Period Subscribers” is the sum of End of Period Digital Subscribers, End of Period Workshops + Digital Subscribers and End of Period Clinical Subscribers. |
WW INTERNATIONAL, INC. AND SUBSIDIARIES
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES
(IN THOUSANDS, EXCEPT PERCENTAGES)
UNAUDITED
| Q1 2024 Variance | ||||||||||||||||||||||||
| 2024 | ||||||||||||||||||||||||
| Constant | ||||||||||||||||||||||||
| Q1 2024 | Q1 2023 | 2024 | Currency | |||||||||||||||||||||
| Currency | Constant | vs | vs | |||||||||||||||||||||
| GAAP | Adjustment | Currency | GAAP | 2023 | 2023 | |||||||||||||||||||
| Selected Financial Data |
||||||||||||||||||||||||
| Total Revenues |
$ | 206,548 | $ | (783 | ) | $ | 205,765 | $ | 241,895 | (14.6 | %) | (14.9 | %) | |||||||||||
| Digital Subscription Revenues (1) |
$ | 137,633 | $ | (602 | ) | $ | 137,031 | $ | 149,344 | (7.8 | %) | (8.2 | %) | |||||||||||
| Workshops + Digital Subscription Revenues (2) |
$ | 47,671 | $ | (168 | ) | $ | 47,503 | $ | 61,688 | (22.7 | %) | (23.0 | %) | |||||||||||
| Clinical Subscription Revenues (3) |
$ | 18,752 | $ | — | $ | 18,752 | $ | — | N/A | N/A | ||||||||||||||
| Subscription Revenues (4) |
$ | 204,056 | $ | (770 | ) | $ | 203,286 | $ | 211,032 | (3.3 | %) | (3.7 | %) | |||||||||||
| Other Revenues (5) |
$ | 2,492 | $ | (13 | ) | $ | 2,479 | $ | 30,863 | (91.9 | %) | (92.0 | %) | |||||||||||
| 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. |
| (2) | “Workshops + Digital Subscription Revenues” consist of the fees associated with subscriptions for combined workshops and Digital offerings. |
| (3) | “Clinical Subscription Revenues” consist of the fees associated with subscriptions for the Company’s Clinical offerings. |
| (4) | “Subscription Revenues” equal “Digital Subscription Revenues” plus “Workshops + Digital Subscription Revenues” plus “Clinical Subscription Revenues”. |
| (5) | “Other Revenues” (formerly known as “product sales and other”) consist of revenues from licensing and publishing, franchise fees with respect to commitment plans and royalties, and other revenues. Prior to fiscal 2024, “Other Revenues” included sales of consumer products. |
WW INTERNATIONAL, INC. AND SUBSIDIARIES
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES
(IN THOUSANDS, EXCEPT PERCENTAGES)
UNAUDITED
| Q1 2024 Variance | ||||||||||||||||||||||||||||||||||||||||||||||||||||
| 2024 Constant Currency | ||||||||||||||||||||||||||||||||||||||||||||||||||||
| Q1 2024 | Q1 2023 | 2024 Adjusted vs 2023 Adjusted |
2024 vs 2023 |
2024 Adjusted vs 2023 Adjusted |
||||||||||||||||||||||||||||||||||||||||||||||||
| GAAP | Adjustment | Adjusted | Currency Adjustment |
Constant Currency |
Adjusted Constant Currency |
GAAP | Adjustment | Adjusted | 2024 vs 2023 |
|||||||||||||||||||||||||||||||||||||||||||
| Selected Financial Data |
|
|||||||||||||||||||||||||||||||||||||||||||||||||||
| Gross Profit |
$ | 137,800 | $ | 2,455 | (1) | $ | 140,255 | $ | (575 | ) | $ | 137,225 | $ | 139,680 | $ | 119,511 | $ | 18,618 | (5) | $ | 138,129 | 15.3 | % | 1.5 | % | 14.8 | % | 1.1 | % | |||||||||||||||||||||||
| Gross Margin |
66.7% | 67.9% | 66.7% | 67.9% | 49.4% | 57.1% | ||||||||||||||||||||||||||||||||||||||||||||||
| Selling, General and Administrative Expenses |
$ | 58,982 | $ | (3,282 | ) (2) | $ | 55,700 | $ | (125 | ) | $ | 58,857 | $ | 55,575 | $ | 59,860 | $ | (7,761 | ) (6) | $ | 52,099 | (1.5 | %) | 6.9 | % | (1.7 | %) | 6.7 | % | |||||||||||||||||||||||
| Operating Loss |
$ | (269,332 | ) | $ | 263,725 | (3) | $ | (5,607 | ) | $ | (263 | ) | $ | (269,595 | ) | $ | (5,766 | ) (4) | $ | (28,583 | ) | $ | 26,379 | (7) | $ | (2,204 | ) | 842.2 | % | 154.2 | % | 843.2 | % | 161.4 | % | |||||||||||||||||
| Operating Loss Margin |
(130.4% | ) | (2.7% | ) | (131.0% | ) | (2.8% | ) | (11.8% | ) | (0.9% | ) | ||||||||||||||||||||||||||||||||||||||||
| Note: | Totals may not sum due to rounding. |
| (1) | Excludes the net impact of $2,430 of charges associated with the Company’s previously disclosed 2023 restructuring plan and $25 of charges associated with the Company’s previously disclosed 2022 restructuring plan. |
| (2) | Excludes the net impact of $3,063 of charges associated with the Company’s previously disclosed 2023 restructuring plan and $219 of charges associated with the Company’s previously disclosed 2022 restructuring plan. |
| (3) | Excludes (i) the impact of impairment charges of the Company’s franchise rights acquired of $251,431, $4,074, $2,328 and $155 related to its United States, Australia, New Zealand and United Kingdom units of account, respectively, and (ii) the net impact of (a) $2,430 of charges and $3,063 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, and (b) $25 of charges and $219 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. |
| (4) | Includes $104 of currency adjustment associated with the impairment charges of the Company’s franchise rights acquired of $4,074, $2,328 and $155 related to its Australia, New Zealand and United Kingdom units of account, respectively. |
| (5) | Excludes the net impact of $18,893 of charges associated with the Company’s previously disclosed 2023 restructuring plan, the reversal of $263 of charges associated with the Company’s previously disclosed 2022 restructuring plan, the reversal of $7 of charges associated with the Company’s previously disclosed 2021 organizational restructuring plan and the reversal of $5 of charges associated with the Company’s previously disclosed 2020 organizational restructuring plan. |
| (6) | Excludes (i) the impact of $3,739 of charges associated with the Company’s previously disclosed 2023 restructuring plan and $303 of charges associated with the Company’s previously disclosed 2022 restructuring plan, and (ii) the impact of $3,719 of acquisition transaction costs. |
| (7) | Excludes (i) the net impact of (a) $18,893 of charges and $3,739 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, (b) the reversal of $263 of charges and $303 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, (c) the reversal of $7 of charges associated with the Company’s previously disclosed 2021 organizational restructuring plan recorded to cost of subscription revenues, and (d) the reversal of $5 of charges associated with the Company’s previously disclosed 2020 organizational restructuring plan recorded to cost of subscription revenues, and (ii) the impact of $3,719 of acquisition transaction costs. |
WW INTERNATIONAL, INC. AND SUBSIDIARIES
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES
(IN THOUSANDS)
UNAUDITED
| Three Months Ended | ||||||||
| March 30, | April 1, | |||||||
| 2024 | 2023 | |||||||
| Net Loss |
$ | (347,902 | ) | $ | (118,679 | ) | ||
| Interest |
24,727 | 22,846 | ||||||
| Taxes |
55,448 | 67,580 | ||||||
| Depreciation and Amortization |
10,403 | 10,273 | ||||||
| Stock-based Compensation |
2,402 | 2,669 | ||||||
|
|
|
|
|
|||||
| EBITDAS |
$ | (254,922 | ) | $ | (15,311 | ) | ||
| Franchise Rights Acquired Impairments (1) |
257,988 | — | ||||||
| 2023 Plan Restructuring Charges (2) |
5,493 | 22,632 | ||||||
| 2022 Plan Restructuring Charges (3) |
244 | 40 | ||||||
| 2021 Plan Restructuring Charges (4) |
— | (7 | ) | |||||
| 2020 Plan Restructuring Charges (5) |
— | (5 | ) | |||||
| Acquisition Transaction Costs (6) |
— | 3,719 | ||||||
|
|
|
|
|
|||||
| Adjusted EBITDAS |
$ | 8,803 | $ | 11,068 | ||||
|
|
|
|
|
|||||
| Note: | Totals may not sum due to rounding. |
| (1) | Impairment charges of the Company’s franchise rights acquired of $251,431, $4,074, $2,328 and $155 related to its United States, Australia, New Zealand and United Kingdom units of account, respectively. |
| (2) | Charges associated with the Company’s previously disclosed 2023 restructuring plan. |
| (3) | Charges associated with the Company’s previously disclosed 2022 restructuring plan. |
| (4) | The reversal of charges associated with the Company’s previously disclosed 2021 organizational restructuring plan. |
| (5) | The reversal of charges associated with the Company’s previously disclosed 2020 organizational restructuring plan. |
| (6) | Certain non-recurring transaction costs in connection with the Company’s acquisition of Sequence. |
WW INTERNATIONAL, INC. AND SUBSIDIARIES
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES
(IN THOUSANDS, EXCEPT RATIOS)
UNAUDITED
| Q2 2023 | Q3 2023 | Q4 2023 | Q1 2024 | Trailing Twelve Months |
||||||||||||||||
| Net Debt to Adjusted EBITDAS |
||||||||||||||||||||
| Net Income (Loss) |
$ | 50,828 | $ | 43,731 | $ | (88,135 | ) | $ | (347,902 | ) | $ | (341,478 | ) | |||||||
| Interest |
24,075 | 24,508 | 24,464 | 24,727 | 97,774 | |||||||||||||||
| Taxes |
(48,066 | ) | (38,447 | ) | 57,556 | 55,448 | 26,491 | |||||||||||||
| Depreciation and Amortization |
11,932 | 13,428 | 10,007 | 10,403 | 45,770 | |||||||||||||||
| Stock-based Compensation |
3,063 | 3,225 | 2,346 | 2,402 | 11,036 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
| EBITDAS |
$ | 41,832 | $ | 46,445 | $ | 6,238 | $ | (254,922 | ) | $ | (160,407 | ) | ||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
| Franchise Rights Acquired and Goodwill Impairments |
— | — | 3,633 | (1) | 257,988 | (2) | 261,621 | |||||||||||||
| 2023 Plan Restructuring Charges (3) |
1,784 | 6,187 | 23,140 | 5,493 | 36,604 | |||||||||||||||
| 2022 Plan Restructuring Charges (4) |
818 | (212 | ) | 489 | 244 | 1,339 | ||||||||||||||
| 2021 Plan Restructuring Charges (5) |
64 | — | — | — | 64 | |||||||||||||||
| 2020 Plan Restructuring Charges (6) |
(16 | ) | — | — | — | (16 | ) | |||||||||||||
| Acquisition Transaction Costs (7) |
4,886 | — | — | — | 4,886 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
| Adjusted EBITDAS |
$ | 49,368 | $ | 52,420 | $ | 33,500 | $ | 8,803 | $ | 144,091 | ||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
| Total Debt |
$ | 1,427,509 | ||||||||||||||||||
| Less: Cash |
66,615 | |||||||||||||||||||
|
|
|
|||||||||||||||||||
| Net Debt |
$ | 1,360,894 | ||||||||||||||||||
|
|
|
|||||||||||||||||||
| Total Debt to Net Loss |
(4.2 | )X | ||||||||||||||||||
|
|
|
|||||||||||||||||||
| Net Debt to Adjusted EBITDAS |
9.4 X | |||||||||||||||||||
|
|
|
|||||||||||||||||||
| Note: | Totals may not sum due to rounding. |
| (1) | Impairment charges of the Company’s goodwill of $2,383 and $1,203 related to its Republic of Ireland and Northern Ireland reporting units, respectively, and the impairment charge of the Company’s franchise rights acquired of $47 related to its Northern Ireland unit of account. |
| (2) | Impairment charges of the Company’s franchise rights acquired of $251,431, $4,074, $2,328 and $155 related to its United States, Australia, New Zealand and United Kingdom units of account, respectively. |
| (3) | Charges associated with the Company’s previously disclosed 2023 restructuring plan. |
| (4) | Charges or the reversal of charges, as applicable, associated with the Company’s previously disclosed 2022 restructuring plan. |
| (5) | Charges 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) | Certain non-recurring transaction costs in connection with the Company’s acquisition of Sequence. |
WW INTERNATIONAL, INC. AND SUBSIDIARIES
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES
(IN MILLIONS)
UNAUDITED
| Full Year 2024 | ||
| Operating Income Guidance Reconciliation | ||
| Operating Loss |
$(163.7) - $(153.7) | |
| Net Restructuring Charges (1) |
$(5.7) | |
| Franchise Rights Acquired Impairments (2) |
$(258.0) | |
|
| ||
| Adjusted Operating Income |
$100.0 - $110.0 | |
|
|
| (1) | Reflects the net restructuring charges incurred in first quarter of fiscal 2024 related to the Company’s previously disclosed 2023 restructuring plan and 2022 restructuring plan. |
| (2) | Reflects the impairment charges of the Company’s franchise rights acquired related to its United States, Australia, New Zealand and United Kingdom units of account in the first quarter of fiscal 2024. |