Pittsburgh, PA—GNC Holdings reported their first quarter 2020 results, including a net loss of $200.1 million, compared with a net loss of $15.3 million for the first quarter of 2019. A press release on the topic notes that U.S. company-owned same-store sales decreased 10.1% compared to the first quarter of 2019; excluding the impact of the COVID-19 pandemic, those sales decreased 4.4%. 1,100, of 30%, of the U.S. and Canada company-owned and franchise retail stores were closed due to the pandemic as of March 31, 2020.
GNC reported consolidated revenue of $472.6 million, compared with consolidated revenue of $564.8 million in the first quarter 2019. The decrease in revenue, the press release explains, was largely due to the closure of company-owned stores under the store portfolio optimization strategy, sales declines due to COVID-19, the transfer of the Nutra manufacturing to the Manufacturing joint venture, negative same-store sales, and lower domestic and international franchise revenue.
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Other highlights outlined in the press release:
- E-Commerce revenues grew approximately 25% compared with the first quarter of 2019 driven by improved site performance and increased demand related to COVID-19
- Implemented e-commerce order management system early in the first quarter of 2020 and accelerated ship from store capabilities in over 100 locations in the second quarter of 2020
- Launched curbside pickup in the first quarter to allow customers to continue to receive GNC products while enabling social distancing
- Due to impacts of COVID-19, the company has significantly reduced inventory purchases and capital expenditures, as well as taken action to decrease costs by nearly $40 million in 2020 consisting of employee furloughs, marketing reductions, store hours reductions and deferral of non-essential spend
- Continue to evaluate all strategic alternatives to address upcoming debt maturities, including refinancing and restructuring options
Ken Martindale, CEO, said in the release: “As people around the globe cope with the COVID-19 outbreak, GNC’s mission has never been more clear. While this unprecedented situation has significantly disrupted our business and required us to make difficult decisions, we are focused on supporting customers with high quality products through our strong e-commerce channels and new buy-online-ship-from-store and curbside pickup services. Our transformation into a true omni-channel brand continues and we are working diligently to reposition and restructure our business for the future.”