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WW WW International

Filed: 5 May 21, 4:16pm

Exhibit 99.1

 

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For more information, contact:

Investors:

Corey Kinger

VP Investor Relations

corey.kinger@ww.com

Media:

Nicole Penn

VP Corporate Communications

nicole.penn@ww.com

 

 

WW Announces First Quarter 2021 Results and Continued Strong Digital Subscriber Growth

 

  

Q1 2021 End of Period Subscribers of 5.0 million

 

  

Q1 2021 End of Period Digital Subscribers up 16% year-over-year to an all-time high of 4.2 million

 

  

Q1 2021 Revenues of $332 million

 

  

Q1 2021 Gross Margin of 58%; excluding one-time charges, Q1 2021 adjusted gross margin increased over 700 basis points year-over-year to 60%

NEW YORK (May 5, 2021) – WW International, Inc. (NASDAQ: WW) today announced its results for the first quarter of fiscal 2021.

“WW had a strong start to the year, ending Q1 with 5.0 million subscribers, record Digital subscribers, and member retention remaining at an all-time high of over 10 months,” said Mindy Grossman, the Company’s President and CEO. “Today, we are the world’s leading weight loss and wellness digital subscription platform with multiple membership verticals and diverse revenue streams, creating a healthier, more profitable and more sustainable business model. Our continued digital transformation to a personalized, technology experience company was clearly evident in our first quarter results with our high-margin Digital membership growth driving performance and positioning us for subscriber, revenue and profit growth over the balance of 2021.”

Amy O’Keefe, the Company’s CFO, said, “Our first quarter performance was ahead of our expectations, with margin expansion driven by Digital growth and continued cost management in our Workshops business. In addition, our recent refinancing has further strengthened our balance sheet and significantly lowered our interest rates. As the world reopens, we will continue to take decisive actions to capitalize on consumer trends, flex our cost structure to meet demand, and position WW for accelerated momentum.”

 

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Q1 2021 Consolidated Results

 

   Three Months Ended     

% Change

Adjusted for

 
(in millions except percentages and per share amounts)  April 3,
2021
  March 28,
2020
  % Change  Constant
Currency(1)
 

Subscription Revenues, net

  $279.8  $324.7   (13.8%)   (16.5%) 

Product Sales and Other, net

   52.0   75.7   (31.3%)   (33.4%) 
  

 

 

  

 

 

   

Revenues, net

  $331.8  $400.4   (17.1%)   (19.7%) 

Gross Profit

  $193.4  $211.0   (8.3%)   (11.8%) 

Adjustments

     

2021 Restructuring Charges

   5.2   —     
  

 

 

  

 

 

   

Adjusted Gross Profit(1)

  $198.6  $211.0   (5.9%)   (9.3%) 

Operating Income

  $2.8  $24.9   (88.6%)   (97.4%) 

Adjustments

     

2021 Restructuring Charges

   5.5   —     

Goodwill Impairment

   —     3.7   
  

 

 

  

 

 

   

Adjusted Operating Income(1)

  $8.4  $28.5   (70.7%)   (78.3%) 

Net Loss*

  ($18.2 ($6.1  (200.6%)   (227.0%) 

EPS

  ($0.26 ($0.09  (193.5%)   (219.2%) 

Total Paid Weeks

   63.1   65.4   (3.5%)   N/A 

Digital(2) Paid Weeks

   53.5   46.2   15.8  N/A 

Workshops + Digital(3) Paid Weeks

   9.6   19.2   (50.1%)   N/A 

End of Period Subscribers(4)

   5.0   5.0   (1.5%)   N/A 

Digital Subscribers

   4.2   3.6   16.0  N/A 

Workshops + Digital Subscribers

   0.7   1.4   (47.1%)   N/A 

 

Note: Totals may not sum due to rounding.

 

(1)

See “Reconciliation of Non-GAAP Financial Measures” attached to this release for further detail on adjustments to GAAP financial measures.

(2)

“Digital” refers to providing subscriptions to the Company’s digital product offerings, including Digital 360 and Personal Coaching + Digital.

(3)

“Workshops + Digital” (formerly known as “Studio + Digital”) refers to providing unlimited access to the Company’s workshops combined with the Company’s digital subscription product offerings to commitment plan subscribers. It also includes the provision of access to workshops for members who do not subscribe to commitment plans, including the Company’s “pay-as-you-go” members.

(4)

“Subscribers” refers to Digital subscribers and Workshops + Digital subscribers who participate in recur bill programs in Company-owned operations.

 

*

Except in the case of the financials attached to this release, “Net Loss” refers to Net Loss attributable to WW International, Inc.

 

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Q1 2021 Business and Financial Highlights

 

  

End of Period Subscribers in Q1 2021 were down 1.5% versus the prior year period, driven by declines in End of Period Workshops + Digital subscribers, partially offset by increases in End of Period Digital Subscribers in all major geographic markets. Q1 2021 End of Period Digital Subscribers were up 16.0% and End of Period Workshops + Digital Subscribers were down 47.1% versus the prior year period.

 

  

Total Paid Weeks in Q1 2021 were down 3.5% versus the prior year period, driven by declines in Workshops + Digital Paid Weeks, partially offset by increases in Digital Paid Weeks in all major geographic markets. Q1 2021 Digital Paid Weeks increased 15.8% and Workshops + Digital Paid Weeks decreased 50.1% versus the prior year period.

 

  

Revenues in Q1 2021 were $331.8 million. On a constant currency basis, Q1 2021 revenues decreased 19.7% versus the prior year period.

 

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Subscription Revenues in Q1 2021 were $279.8 million. On a constant currency basis, these revenues decreased 16.5% versus the prior year period, primarily driven by declines in Workshops + Digital Fees as a result of the closure of studios and reduced operations related to COVID-19.

 

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Product Sales and Other in Q1 2021 were $52.0 million. On a constant currency basis, these revenues decreased 33.4% versus the prior year period, primarily driven by declines in product sales as a result of the closure of studios and reduced operations related to COVID-19.

 

  

Gross Profit in Q1 2021 was $193.4 million. Adjusted gross profit in Q1 2021 was $198.6 million, which excluded $5.2 million in charges associated with the Company’s 2021 organizational restructuring plan. Gross profit in Q1 2020 was $211.0 million.

 

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Gross Margin in Q1 2021 was 58.3%. Adjusted gross margin was 59.9%, up from 52.7% in the prior year period driven primarily by a mix shift to the Company’s higher margin Digital business and cycling against the net profit from the WW Presents: Oprah’s 2020 Vision tour.

 

  

Operating Income in Q1 2021 was $2.8 million. Adjusted operating income in Q1 2021, which excluded $5.5 million in charges associated with the Company’s 2021 organizational restructuring plan, was $8.4 million. Operating income in Q1 2020 was $24.9 million. Adjusted operating income in Q1 2020, which excluded the $3.7 million goodwill impairment charge related to the decision to shift to an exclusively Digital business in Brazil, was $28.5 million.

 

  

Effective Tax Rate in Q1 2021 was 30.0%, compared to 9.7% in the prior year period.

 

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Net Loss in Q1 2021 was $18.2 million compared to a net loss of $6.1 million in the prior year period.

 

  

Net loss per fully diluted share in Q1 2021 was $0.26 compared to a loss of $0.09 in the prior year period.

 

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Certain items affect year-over-year comparability.

 

  

Q1 2021 results included a $5.5 million restructuring charge, which negatively impacted earnings per fully diluted share by $0.06.

 

  

Q1 2020 results included a $3.7 million goodwill impairment charge related to the Company’s Brazil operations, which negatively impacted earnings per fully diluted share by $0.05.

Other Items

 

  

Cash balance as of April 3, 2021 was $113.3 million. On that same date, the Company had no outstanding borrowings under its $175 million revolving credit facility.

 

  

2021 Restructuring Plan: The Company has revised the cost of its previously disclosed 2021 restructuring plan to approximately $11.0 million in fiscal 2021 from its prior estimate of approximately $18.0 million in fiscal 2021. The plan is related to strategic cost reductions to its global Workshops + Digital operations to adjust to anticipated consumer demand.

First Quarter 2021 Conference Call and Webcast

The Company has scheduled a conference call today at 5:00 p.m. ET. During the conference call, Mindy Grossman, President and Chief Executive Officer, Nicholas Hotchkin, Chief Operating Officer, and Amy O’Keefe, Chief Financial Officer, will discuss the first quarter of fiscal 2021 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, in the Investors section under Presentations and Events. 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

 

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operating results that exclude or adjust certain items. Gross profit, gross profit margin, operating income, operating income 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 the first quarter of fiscal 2021 to exclude the impact of charges associated with the Company’s 2021 organizational restructuring plan and with respect to the first quarter of fiscal 2020 to exclude the impact of the impairment charge for the Company’s goodwill related to its Brazil operations. 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, restructuring charges and goodwill impairment (“Adjusted EBITDAS”), net debt, and a net debt to 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.

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 should not 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 entitled 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.

WW (formerly Weight Watchers) is a human-centric technology company powered by the world’s leading commercial weight management program. As a global wellness company, we inspire millions of people to adopt healthy habits for real life. Through our comprehensive digital app, expert Coaches and engaging experiences, members follow our proven, sustainable, science-based program focused on food, activity, mindset and sleep. Leveraging nearly six decades of expertise in nutritional and behavioral change science, providing real human connection and building inspired communities, our purpose is to democratize and deliver holistic wellness for all. To learn more about the WW 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, revenue and earnings guidance and any statements about the Company’s plans, strategies, objectives, and prospects and the impact of the COVID-19 virus. 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

 

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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: the impact of the global outbreak of the COVID-19 virus on the Company’s business and liquidity and on the business environment and markets in which the Company operates; competition from other weight management 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 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 the Company’s ability to successfully expand into new channels of distribution or respond to consumer trends; the ability to successfully implement strategic initiatives; the effectiveness of the Company’s advertising and marketing programs, including the strength of its social media presence; the impact on the Company’s reputation of actions taken by its franchisees, licensees, suppliers and other partners; 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 inability to renew certain of the Company’s licenses, or the inability to do so on terms that are favorable to the Company; the expiration or early termination by the Company of leases; uncertainties related to a downturn in general economic conditions or consumer confidence; the Company’s ability to successfully make acquisitions or enter into joint ventures, including its ability to successfully integrate, operate or realize the anticipated benefits of such businesses; the seasonal nature of the Company’s business; the impact of events that discourage or impede people from gathering with others or accessing resources; the Company’s failure to maintain effective internal control over financial reporting; the impact of the Company’s substantial amount of debt, debt service obligations and debt covenants, and the Company’s 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 or privacy concerns, including the costs of compliance with evolving privacy laws and regulations; 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; the outcomes of litigation or regulatory actions; the impact of existing and future laws and regulations; the possibility that the interests of Artal Group S.A., the largest holder of the Company’s common stock and a shareholder with significant influence over the Company, will conflict with the Company’s interests or the interests of other holders of the Company’s common stock; the impact that the sale of substantial amounts of the Company’s common stock by existing large shareholders, or the perception that such sales could occur, could have on the market price of the Company’s common stock; and other risks and uncertainties, including those detailed from time to time in the Company’s periodic reports filed with the Securities and Exchange Commission. 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 United States Securities and Exchange Commission (which are available on the SEC’s EDGAR database at www.sec.gov and via the Company’s website at corporate.ww.com).

 

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WW INTERNATIONAL, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(IN THOUSANDS)

UNAUDITED

 

   April 3,
2021
  January 2,
2021
 

ASSETS

   

Cash and cash equivalents

  $113,313  $165,887 

Other current assets

   137,863   133,305 
  

 

 

  

 

 

 

TOTAL CURRENT ASSETS

   251,176   299,192 

Property and equipment, net

   46,893   51,935 

Operating lease assets

   108,138   119,102 

Goodwill, franchise rights and other intangible assets, net

   1,001,620   981,176 

Other assets

   28,547   29,769 
  

 

 

  

 

 

 

TOTAL ASSETS

  $1,436,374  $1,481,174 
  

 

 

  

 

 

 

LIABILITIES AND TOTAL DEFICIT

   

Portion of long-term debt due within one year

  $77,000  $77,000 

Portion of operating lease liabilities due within one year

   24,045   28,551 

Other current liabilities

   226,281   234,548 
  

 

 

  

 

 

 

TOTAL CURRENT LIABILITIES

   327,326   340,099 

Long-term debt

   1,391,019   1,408,800 

Long-term operating lease liabilities

   93,552   101,561 

Deferred income taxes, other

   180,255   178,925 
  

 

 

  

 

 

 

TOTAL LIABILITIES

  $ 1,992,152  $ 2,029,385 
  

 

 

  

 

 

 

Shareholders’ deficit

   (555,778  (548,211
  

 

 

  

 

 

 

TOTAL LIABILITIES AND TOTAL DEFICIT

  $1,436,374  $1,481,174 
  

 

 

  

 

 

 


WW INTERNATIONAL, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF NET INCOME

(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)

UNAUDITED

 

   Three Months Ended 
   April 3,
2021
  March 28,
2020
 

Subscription revenues, net (1)

  $ 279,820  $ 324,657 

Product sales and other, net (2)

   51,976   75,704 
  

 

 

  

 

 

 

Revenues, net

   331,796   400,361 
  

 

 

  

 

 

 

Cost of subscription revenues (3)

   99,103   135,566 

Cost of product sales and other

   39,258   53,804 
  

 

 

  

 

 

 

Cost of revenues

   138,361   189,370 
  

 

 

  

 

 

 

Gross profit

   193,435   210,991 

Marketing expenses

   116,933   117,933 

Selling, general and administrative expenses

   73,671   64,526 

Goodwill impairment

   —     3,665 
  

 

 

  

 

 

 

Operating income

   2,831   24,867 

Interest expense

   29,123   31,551 

Other (income) expense, net

   (237  24 
  

 

 

  

 

 

 

Loss before income taxes

   (26,055  (6,708

Benefit from income taxes

   (7,828  (651
  

 

 

  

 

 

 

Net loss

   (18,227  (6,057

Net income attributable to the noncontrolling interest

   —     (6
  

 

 

  

 

 

 

Net loss attributable to WW International, Inc.

  $ (18,227 $(6,063
  

 

 

  

 

 

 

Loss Per Share attributable to WW International, Inc.

   

Basic

  $(0.26 $(0.09
  

 

 

  

 

 

 

Diluted

  $(0.26 $(0.09
  

 

 

  

 

 

 

Weighted average common shares outstanding:

   

Basic

   69,084   67,436 
  

 

 

  

 

 

 

Diluted

   69,084   67,436 
  

 

 

  

 

 

 

 

Note: Totals may not sum due to rounding.

 

(1)

Consists of net “Digital Subscription Revenues” and net “Workshops + Digital Fees” (formerly known as “Studio + Digital Fees”). “Digital Subscription Revenues” consist of the fees associated with subscriptions for the Company’s Digital offerings, including Digital 360 and Personal Coaching + Digital. “Workshops + Digital Fees” consist of the fees associated with the Company’s subscription plans for combined workshops and digital offerings and other payment arrangements for access to workshops.

(2) 

Consists of sales of consumer products via e-commerce, in studios and through the Company’s trusted partners, revenues from licensing and publishing, other revenues, and franchise fees with respect to commitment plans and royalties.

(3) 

Consists of cost of revenues and operating expenses for the Company’s Digital and Workshops + Digital services.


WW INTERNATIONAL, INC. AND SUBSIDIARIES

OPERATIONAL STATISTICS

(IN THOUSANDS, EXCEPT PERCENTAGES)

UNAUDITED

 

   Three Months Ended     
   April 3,   March 28,   Variance 
   2021   2020 

Digital Paid Weeks (1)

      

North America

   33,471    29,420    13.8

CE

   15,549    12,960    20.0

UK

   3,398    2,881    17.9

Other (2)

   1,086    943    15.2
  

 

 

   

 

 

   

 

 

 

Total Digital Paid Weeks

   53,505    46,205    15.8

Workshops + Digital Paid Weeks (1)

      

North America

   6,669    12,964    (48.6%) 

CE

   1,521    3,016    (49.6%) 

UK

   1,040    2,614    (60.2%) 

Other (2)

   339    593    (42.8%) 
  

 

 

   

 

 

   

 

 

 

Total Workshops + Digital Paid Weeks

   9,569    19,187    (50.1%) 

Total Paid Weeks (1)

      

North America

   40,140    42,384    (5.3%) 

CE

   17,070    15,976    6.8

UK

   4,438    5,496    (19.2%) 

Other (2)

   1,425    1,536    (7.2%) 
  

 

 

   

 

 

   

 

 

 

Total Paid Weeks

   63,074    65,392    (3.5%) 

End of Period Digital Subscribers (3)

      

North America

   2,631    2,311    13.8

CE

   1,238    1,032    19.9

UK

   267    221    21.0

Other (2)

   82    72    13.2
  

 

 

   

 

 

   

 

 

 

Total End of Period Digital Subscribers

   4,217    3,636    16.0

End of Period Workshops + Digital Subscribers (3)

      

North America

   530    940    (43.6%) 

CE

   111    231    (51.8%) 

UK

   73    183    (60.1%) 

Other (2)

   25    44    (42.3%) 
  

 

 

   

 

 

   

 

 

 

Total End of Period Workshops + Digital Subscribers

   739    1,398    (47.1%) 

Total End of Period Subscribers (3)

      

North America

   3,161    3,251    (2.8%) 

CE

   1,349    1,263    6.8

UK

   340    404    (15.8%) 

Other (2)

   107    116    (7.8%) 
  

 

 

   

 

 

   

 

 

 

Total End of Period Subscribers

   4,957    5,034    (1.5%) 

 

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 subscription products (including Digital 360 and Personal Coaching + Digital); (ii) “Workshops + Digital Paid Weeks” (formerly known as “Studio + Digital Paid Weeks”) is the sum of total paid commitment plan weeks which include workshops and digital offerings and total “pay-as-you-go” weeks; and (iii) “Total Paid Weeks” is the sum of Digital Paid Weeks and Workshops + Digital Paid Weeks.

(2) 

Represents Australia, New Zealand and emerging markets.

(3) 

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, including Digital 360 and Personal Coaching + Digital, subscribers; (ii) “End of Period Workshops + Digital Subscribers” (formerly known as “End of Period Studio + Digital Subscribers”) is the total number of commitment plan subscribers that have access to combined workshops and digital offerings; and (iii) “End of Period Subscribers” is the sum of End of Period Digital Subscribers and End of Period Workshops + Digital Subscribers.


WW INTERNATIONAL, INC. AND SUBSIDIARIES

RECONCILIATION OF NON-GAAP FINANCIAL MEASURES

(IN THOUSANDS, EXCEPT PERCENTAGES)

UNAUDITED

 

                  Q1 2021 Variance 
                     2021 
              Constant 
   Q1 2021   Q1 2020   2021  Currency 
       Currency  Constant       vs  vs 
   GAAP   Adjustment  Currency   GAAP   2020  2020 

Selected Financial Data

          

Consolidated Company Revenues

  $331,796   $(10,398 $321,398   $400,361    (17.1%)   (19.7%) 

Consolidated Digital Subscription Revenues (1)

  $206,062   $(7,031 $199,031   $174,545    18.1  14.0

Consolidated Workshops + Digital Fees (2)

  $73,758   $(1,781 $71,977   $150,112    (50.9%)   (52.1%) 

Consolidated Subscription Revenues (3)

  $279,820   $(8,812 $271,008   $324,657    (13.8%)   (16.5%) 

Consolidated Product Sales and Other (4)

  $51,976   $(1,586 $50,390   $75,704    (31.3%)   (33.4%) 

North America

          

Digital Subscription Revenues (1)

  $132,090   $(532 $131,558   $116,349    13.5  13.1

Workshops + Digital Fees (2)

  $54,904   $(163 $54,741   $112,843    (51.3%)   (51.5%) 

Subscription Revenues (3)

  $186,994   $(696 $186,298   $229,192    (18.4%)   (18.7%) 

Product Sales and Other (4)

  $34,321   $(138 $34,183   $54,514    (37.0%)   (37.3%) 

Total Revenues

  $221,315   $(833 $220,482   $283,706    (22.0%)   (22.3%) 

CE

          

Digital Subscription Revenues (1)

  $58,915   $(5,146 $53,769   $46,638    26.3  15.3

Workshops + Digital Fees (2)

  $10,940   $(955 $9,985   $21,519    (49.2%)   (53.6%) 

Subscription Revenues (3)

  $69,855   $(6,100 $63,755   $68,157    2.5  (6.5%) 

Product Sales and Other (4)

  $12,041   $(1,035 $11,006   $11,833    1.8  (7.0%) 

Total Revenues

  $81,896   $(7,135 $74,761   $79,990    2.4  (6.5%) 

UK

          

Digital Subscription Revenues (1)

  $9,809   $(712 $9,097   $7,576    29.5  20.1

Workshops + Digital Fees (2)

  $5,169   $(371 $4,798   $11,129    (53.6%)   (56.9%) 

Subscription Revenues (3)

  $14,978   $(1,082 $13,896   $18,705    (19.9%)   (25.7%) 

Product Sales and Other (4)

  $4,089   $(273 $3,816   $6,323    (35.3%)   (39.7%) 

Total Revenues

  $19,067   $(1,356 $17,711   $25,028    (23.8%)   (29.2%) 

Other (5)

          

Digital Subscription Revenues (1)

  $5,248   $(641 $4,607   $3,982    31.8  15.7

Workshops + Digital Fees (2)

  $2,745   $(293 $2,452   $4,621    (40.6%)   (46.9%) 

Subscription Revenues (3)

  $7,993   $(934 $7,059   $8,603    (7.1%)   (17.9%) 

Product Sales and Other (4)

  $1,525   $(133 $1,392   $3,034    (49.7%)   (54.1%) 

Total Revenues

  $9,518   $(1,067 $8,451   $11,637    (18.2%)   (27.4%) 

 

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, including Digital 360 and Personal Coaching + Digital.

(2) 

“Workshops + Digital Fees” consist of the fees associated with the Company’s subscription plans for combined workshops and digital offerings and other payment arrangements for access to workshops.

(3) 

“Subscription Revenues” equal “Digital Subscription Revenues” plus “Workshops + Digital Fees”.

(4) 

“Product Sales and Other” are sales of consumer products via e-commerce, in studios and through the Company’s trusted partners, revenues from licensing and publishing, other revenues, and, in the case of the consolidated financial results and Other reportable segment, franchise fees with respect to commitment plans and royalties.

(5) 

Represents Australia, New Zealand, emerging markets and franchise revenues.


WW INTERNATIONAL, INC. AND SUBSIDIARIES

RECONCILIATION OF NON-GAAP FINANCIAL MEASURES

(IN THOUSANDS, EXCEPT PERCENTAGES)

UNAUDITED

 

              Q1 2021 Variance 
                                   2021 Constant Currency 
                                2021     2021 
  Q1 2021  Q1 2020     Adjusted     Adjusted 
                 Adjusted           2021  vs  2021  vs 
           Currency  Constant  Constant           vs  2020  vs  2020 
  GAAP  Adjustment  Adjusted  Adjustment  Currency  Currency  GAAP  Adjustment (4)  Adjusted  2020  Adjusted  2020  Adjusted 

Selected Financial Data

             

Gross Profit

 $193,435  $5,202(1)  $198,637  $(7,245 $186,190  $191,392  $210,991  $—    $210,991   (8.3%)   (5.9%)   (11.8%)   (9.3%) 

Gross Margin

  58.3   59.9   57.9  59.5  52.7   52.7    

Selling, General and Administrative Expenses

 $73,671  $(337)(2)  $73,334  $(1,203 $72,468  $72,132  $64,526  $—    $64,526   14.2  13.7  12.3  11.8

Operating Income

 $2,831  $5,539(3)  $8,370  $(2,192 $639  $6,177  $24,867  $3,665  $28,532   (88.6%)   (70.7%)   (97.4%)   (78.3%) 

Operating Income Margin

  0.9   2.5   0.2  1.9  6.2   7.1    

 

Note: Totals may not sum due to rounding.

 

(1) 

Excludes $5,202 of charges associated with the Company’s previously disclosed 2021 organizational restructuring plan.

(2) 

Excludes $337 of charges associated with the Company’s previously disclosed 2021 organizational restructuring plan.

(3) 

Excludes the $5,202 and $337 of charges associated with the Company’s previously disclosed 2021 organizational restructuring plan recorded to cost of subscription revenues and selling, general and administrative expenses, respectively.

(4) 

Excludes the impairment charge of $3,665 for the Company’s goodwill related to its Brazil operations.


WW INTERNATIONAL, INC. AND SUBSIDIARIES

RECONCILIATION OF NON-GAAP FINANCIAL MEASURES

(IN THOUSANDS)

UNAUDITED

 

   Three Months Ended 
   April 3,
2021
  March 28,
2020
 

Net Loss

  $(18,227 $(6,063

Interest

   29,123   31,551 

Taxes

   (7,828  (651

Depreciation and Amortization

   11,925   12,211 

Stock-based Compensation

   5,341   3,965 
  

 

 

  

 

 

 

EBITDAS

  $20,334  $41,013 

2021 Restructuring Charges (1)

   5,538   —   

Goodwill Impairment (2)

   —     3,665 
  

 

 

  

 

 

 

Adjusted EBITDAS

  $25,872  $44,678 
  

 

 

  

 

 

 

 

Note: Totals may not sum due to rounding.

 

(1) 

Charges associated with the Company’s previously disclosed 2021 organizational restructuring plan.

(2) 

Impairment charge of the Company’s goodwill related to its Brazil operations.


WW INTERNATIONAL, INC. AND SUBSIDIARIES

RECONCILIATION OF NON-GAAP FINANCIAL MEASURES

(IN THOUSANDS, EXCEPT RATIO)

UNAUDITED

 

   Q2 2020   Q3 2020   Q4 2020   Q1 2021  Trailing Twelve
Months
 

Net Debt to Adjusted EBITDAS

         

Net Income (Loss)

  $14,006   $54,525   $12,611   $(18,227 $62,915 

Interest

   30,995    29,735    31,030    29,123   120,883 

Taxes

   5,592    8,604    3,916    (7,828  10,284 

Depreciation and Amortization

   12,771    12,420    12,598    11,925   49,714 

Stock-based Compensation

   38,686    6,029    6,333    5,341   56,388 
  

 

 

   

 

 

   

 

 

   

 

 

  

 

 

 

EBITDAS

  $102,049   $111,313   $66,487   $20,334  $300,184 
  

 

 

   

 

 

   

 

 

   

 

 

  

 

 

 

2021 Restructuring Charges (1)

   —      —      —      5,538   5,538 

2020 Restructuring Charges (2)

   11,209    2,251    19,632    —     33,092 
  

 

 

   

 

 

   

 

 

   

 

 

  

 

 

 

Adjusted EBITDAS

  $113,258   $113,564   $86,120   $25,872  $338,814 
  

 

 

   

 

 

   

 

 

   

 

 

  

 

 

 

Total Debt

         $1,468,019 

Less: Cash

          113,313 
         

 

 

 

Net Debt

         $1,354,706 
         

 

 

 

Net Debt to Adjusted EBITDAS

 

        4 X 
       

 

 

 

 

Note: Totals may not sum due to rounding.

 

(1) 

Charges associated with the Company’s previously disclosed 2021 organizational restructuring plan.

(2) 

Charges associated with the Company’s previously disclosed 2020 organizational restructuring plan.