GNC Reports Weak Quarter

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Pittsburgh, PA — GNC released their third-quarter earnings and same-store sales were down 2.1%, including GNC.com.

Tricia Tolivar, CFO of GNC, said on the earnings call that consolidated revenue was $580.2 million. It’s a decrease from the previous year’s $613 million, which Tolivar primarily attributed to the sale of LuckyVitamin in September 2017, resulting in a $20.8 million reduction in revenue and lower sales associated with store closures.

Gross profit was 31.8% of sales, compared with 32.8% in the previous year. The decrease was driven by increased promotional spending.

The company did, however, deliver $50 million in adjusted EBITDA.

E-commerce sales, however, were 7.2% of U.S. and Canada revenue, compared with 6.2% in the prior year quarter. The growth was driven by both gnc.com and Amazon, which they partnered with a year ago.

Manufacturing and Wholesale revenues, excluding inter-segment sales, increased $1 million, thanks to higher contract manufacturing sales. Operating income decreased by $2.3 million.

Adjusted SG&A was 25.2% of sales, 40 basis points above last year.

Domestically, revenue decreased $3.6 million, due in part to a decrease in the number of franchise stores.

Internationally, revenue increased by 6.1%, driven by an increase in same-store sales of 1.5%.

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