By Maria Armental
Weight Watchers International Inc. is stepping up its fitness
and technology focus, building on personal coaching and 24/7 expert
chat to foster the kind of relationships online its members had
developed over face-to-face encounters.
The weight-loss company, which has been shedding members and
losing ground to apps and other gadgets that track calories, said
it was laying off the president of its North American business,
Lesya Lysyj, amid a cost-cutting move aimed to save $100
million.
Ms. Lysyj joined the company in 2013 from Heineken USA. At that
time, Chief Executive Jim Chambers touted her "tremendous
experience in building and turning around well-known consumer
brands."
Weight Watchers didn't specify how many workers would lose their
jobs but said its restructuring costs, which include layoff
charges, are expected to total $10 million for the year.
Overall, Weight Watchers expects a profit of 40 cents to 70
cents a share for the year, compared with the consensus estimate of
$1.43 a share, according to analysts surveyed by Thomson
Reuters.
Mr. Chambers said during a conference call Thursday that the
company's turnaround strategy was handicapped by a challenging
start to 2015, and expects membership to resume growth some time in
2015 and revenue to return to growth in 2016.
Shares fell nearly 15% to $14.99 in after-hours trading
Thursday, below the 52-week-low of $16.40 set on Feb. 2 in regular
trading, as the company reported it swung to a loss in the holiday
quarter.
The New York company, which started in the early 1960s as a
group of friends met in Queens, N.Y., to discuss how to lose
weight, has struggled to recruit and retain paying members.
The number of active subscribers fell 15% in the fourth quarter
from the year-ago period, with online subscribers dropping 16.7%
and meeting subscribers 13.3%.
To halt the decline, Weight Watchers stopped paying a dividend
in 2013 and said it would use the money to restructure operations
and pay down debt.
The company has added more personalized weight-loss programs and
is teaming up with companies and health-insurance providers to
subsidize memberships. As part of its broader marketing push, this
year it advertised for the first time during the Super Bowl.
Still, Weight Watchers reported a fourth-quarter loss of $16.1
million, or 28 cents a share, swinging from a year-earlier profit
of $30.8 million, or 54 cents a share. Excluding restructuring
charges of $26.1 million for franchise rights related to its Canada
operations, profit fell to seven cents a share from 56 cents a year
earlier.
Revenue fell more than 10% to $327.8 million. The quarter
results were in line with analysts' projections.
Through Thursday's closing, the company's stock had fallen
nearly 19% over the past 12 months.
Write to Maria Armental at maria.armental@wsj.com
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