WW Announces Third Quarter 2019 Results and Raises Full Year 2019 EPS Guidance


  • End of Period Subscribers in Q3 2019 of 4.4 million
     
  • Revenues in Q3 2019 of $349 million
     
  • Q3 2019 EPS of $0.68
     
  • Raising FY 2019 EPS guidance to a range of $1.63 to $1.75

NEW YORK, Nov. 05, 2019 (GLOBE NEWSWIRE) -- WW International, Inc. (NASDAQ: WW) today announced its results for the third quarter of fiscal 2019 and raised its full year fiscal 2019 EPS guidance.

“As our strong marketing execution successfully recruited new members and retention continued to increase, we outperformed our expectations for subscriber growth, resulting in our highest-ever end of period subscribers in a third quarter,” said Mindy Grossman, the Company’s President and CEO. “Next week, we will be launching our new program – our most customized yet – which we believe will have broad appeal among current, returning, and first-time members.  The new program, paired with our overall marketing strategy and community activations, including WW Presents Oprah’s 2020 Vision: Your Life in Focus tour, will serve as a strong foundation to accelerate subscriber growth in 2020 and deliver value to our members, employees and shareholders.”

“Subscriber growth gained momentum in the third quarter, with end of period subscribers increasing 6% year-over-year to 4.4 million,” said Nick Hotchkin, the Company’s CFO, Operating Officer, North America and President, Emerging Markets. “We are raising our earnings guidance for the full year to a range of $1.63 to $1.75 per fully diluted share, reflecting the continuation of improving trends across the business.”

Q3 2019 Consolidated Results

      
 
% Change
 % Change
Adjusted for
Constant
Currency(1)
 Three Months Ended  
 September 28, September 29,  
 2019 2018  
(in millions except percentages and per share amounts)       
Service Revenues, net$298.0 $312.0 (4.5%)   (3.0%)
Product Sales and Other, net  50.5   53.8    (6.1%)   (4.6%)
Revenues, net$348.6 $365.8   (4.7%) (3.3%)
Operating Income$94.7 $118.9 (20.3%)   (18.8%)
Net Income*$47.1 $70.1 (32.9%)   (31.2%)
EPS$0.68 $1.00   (32.2%)   (30.4%)
 

Total Paid Weeks
  58.6   56.5   3.7% N/A
Digital(2) Paid Weeks  40.3   36.4   10.8% N/A
Studio + Digital(3) Paid Weeks  18.3   20.1   (9.1%) N/A
        
End of Period Subscribers(4)4.4 4.2 5.7% N/A
Digital  Subscribers  3.1 2.7 12.5% N/A
Studio + Digital Subscribers  1.3   1.4   (7.3%) 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 the Personal Coaching + Digital product.
(3) “Studio + Digital” refers to providing access to the Company’s weekly in-person workshops combined with the Company’s digital subscription product offerings to commitment plan subscribers. The “Studio + Digital” business 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 Studio + Digital subscribers who participate in recur bill programs in Company-owned operations.
*Except in the case of the financials attached to this release, “Net Income” refers to Net Income attributable to WW International, Inc.


Q3 2019 Business and Financial Highlights

  • End of Period Subscribers in Q3 2019 were up 5.7% versus the prior year period. Q3 2019 End of Period Digital Subscribers were up 12.5% and End of Period Studio + Digital Subscribers were down 7.3% versus the prior year period.
     
  • Total Paid Weeks in Q3 2019 were up 3.7% versus the prior year period. Q3 2019 Digital Paid Weeks increased 10.8% and Studio + Digital Paid Weeks decreased 9.1% versus the prior year period. 
     
  • Revenues in Q3 2019 were $348.6 million. On a constant currency basis, Q3 2019 revenues decreased 3.3% versus the prior year period.

         -     Service Revenues in Q3 2019 were $298.0 million. On a constant currency basis, these revenues decreased 3.0% versus the prior year period, primarily driven by Studio + Digital member recruitment declines.

         -     Product Sales and Other in Q3 2019 were $50.5 million. On a constant currency basis, these revenues decreased 4.6% versus the prior year period, primarily due to a decline in product sales.
     
  • Operating Income in Q3 2019 was $94.7 million compared to $118.9 million in the prior year period. This decrease in operating income was primarily driven by operating deleverage on lower revenues in the quarter versus the prior year period. 
     
  • Effective Tax Rate in Q3 2019 was 21.8% compared to 15.0% in the prior year period.
     
  • Net Income in Q3 2019 was $47.1 million compared to $70.1 million in the prior year period.
     
  • Earnings per fully diluted share (EPS) in Q3 2019 was $0.68 compared to $1.00 in the prior year period.
         -     Certain items affect year-over-year comparability.
              -     Q3 2018 results benefited from the reversal of certain tax reserves, the impact of which positively impacted EPS by $0.06 per fully diluted share.

Other Items

  • Cash balance as of September 28, 2019 was $239.2 million. On that same date, the Company had no outstanding borrowings under its $150 million revolving credit facility.  
  • Debt Prepayment: As previously disclosed, subsequent to the end of Q3 2019, the Company voluntarily prepaid $50.0 million in aggregate principal amount of term loans outstanding under its credit agreement. 

             
Full Year Fiscal 2019 Guidance

The Company is reiterating its full year fiscal 2019 revenue guidance of at least $1.4 billion and raising its earnings guidance to between $1.63 and $1.75 per fully diluted share.

Third Quarter 2019 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, and Nicholas Hotchkin, Chief Financial Officer, Operating Officer, North America & President, Emerging Markets, will discuss the third quarter of fiscal 2019 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 operating results that exclude or adjust certain items. The Company presents in the attachments to this release the non-GAAP financial measure earnings before interest, taxes, depreciation, amortization and stock-based compensation (“EBITDAS”).  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. In this release and any attachments, 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. 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.

About WW International, Inc.
WW – Weight Watchers reimagined – is a global wellness company and the world's leading commercial weight management program. We inspire millions of people to adopt healthy habits for real life. Through our engaging digital experience and face-to-face group workshops, members follow our livable and sustainable program that encompasses healthy eating, physical activity, and a helpful mindset. With more than five decades of experience in building communities and our deep expertise in behavioral science, we aim to deliver 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 and prospects. The Company generally uses the words “may,” “will,” “could,” “expect,” “anticipate,” “believe,” “estimate,” “plan,” “intend” 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 wellness industry participants or the development of more effective or more favorably perceived weight management methods; 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 new 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 impact of the Company’s substantial amount of debt and its debt service obligations and debt covenants; 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 security breaches or privacy concerns; 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; risks and uncertainties associated with the Company’s international operations, including regulatory, economic, political and social risks and foreign currency risks; 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 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; the outcomes of litigation or regulatory actions; the impact of existing and future laws and regulations; the Company’s failure to maintain effective internal control over financial reporting; 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).

WW INTERNATIONAL, INC. AND SUBSIDIARIES 
CONDENSED CONSOLIDATED BALANCE SHEETS 
(IN THOUSANDS) 
UNAUDITED 
     
 September 28, December 29, 
  2019   2018  
     
ASSETS    
Cash and cash equivalents$239,162  $236,974  
Other current assets 90,728   129,450  
TOTAL CURRENT ASSETS 329,890   366,424  
Property and equipment, net 49,900   52,202  
Operating lease assets 146,063   -  
Goodwill, franchise rights and other intangible assets, net 963,216   960,815  
Other assets 27,374   35,100  
TOTAL ASSETS$1,516,443  $1,414,541  
     
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 32,372   -  
Other current liabilities 256,414   264,316  
TOTAL CURRENT LIABILITIES 365,786   341,316  
Long-term debt 1,566,692   1,669,708  
Long-term operating lease liabilities 123,541   -  
Deferred income taxes, other 180,365   208,547  
TOTAL LIABILITIES$2,236,384  $2,219,571  
     
Redeemable noncontrolling interest 3,661   3,913  
     
Shareholders' deficit (723,602)  (808,943) 
     
TOTAL LIABILITIES AND TOTAL DEFICIT$1,516,443  $1,414,541  
     


  
WW INTERNATIONAL, INC. AND SUBSIDIARIES 
CONSOLIDATED STATEMENTS OF NET INCOME 
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS) 
UNAUDITED 
    
  Three Months Ended 
  September 28, September 29, 
   2019   2018  
Service revenues, net (1) $298,041  $311,963  
Product sales and other, net (2)  50,526   53,802  
 Revenues, net  348,567   365,765  
Cost of services (3)  122,374   122,357  
Cost of product sales and other  31,424   28,014  
 Cost of revenues  153,798   150,371  
 Gross profit  194,769   215,394  
Marketing expenses  36,327   35,515  
Selling, general and administrative expenses  63,713   61,019  
 Operating income  94,729   118,860  
Interest expense  33,118   35,506  
Other expense, net  1,460   881  
 Income before income taxes  60,151   82,473  
Provision for income taxes  13,123   12,374  
 Net income  47,028   70,099  
Net loss attributable to the noncontrolling interest  58   33  
 Net income attributable to WW International, Inc. $47,086  $70,132  
       
Earnings Per Share attributable to WW International, Inc.     
 Basic $0.70  $1.05  
 Diluted $0.68  $1.00  
       
Weighted average common shares outstanding:     
 Basic  67,298   66,701  
 Diluted  69,617   70,331  
       
______     
Note: Totals may not sum due to rounding.  
      
(1) Consists of net “Digital Subscription Revenues” and net “Studio + Digital Fees”. “Digital Subscription Revenues” consist of the fees associated with subscriptions for the Company’s Digital offerings, including the Personal Coaching + Digital product. “Studio + 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 in workshops and via e-commerce, revenues from licensing, magazine subscriptions, publishing and third-party advertising in publications and on the Company's websites and sales from the By Mail product, other revenues, and franchise fees with respect to commitment plans and commissions. 
(3) Consists of cost of revenues and operating expenses for the Company's Digital and Studio + Digital services. 
       


  
WW INTERNATIONAL, INC. AND SUBSIDIARIES 
CONSOLIDATED STATEMENTS OF NET INCOME 
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS) 
UNAUDITED 
    
  Nine Months Ended 
  September 28, September 29, 
   2019   2018  
Service revenues, net (1) $918,535  $984,362  
Product sales and other, net (2)  162,219   199,373  
 Revenues, net  1,080,754   1,183,735  
Cost of services (3)  373,452   390,296  
Cost of product sales and other  95,771   112,250  
 Cost of revenues  469,223   502,546  
 Gross profit  611,531   681,189  
Marketing expenses  200,543   189,855  
Selling, general and administrative expenses  188,889   182,696  
 Operating income  222,099   308,638  
Interest expense  103,045   107,238  
Other expense, net  2,201   1,978  
 Income before income taxes  116,853   199,422  
Provision for income taxes  26,834   19,580  
 Net income  90,019   179,842  
Net loss attributable to the noncontrolling interest  214   122  
 Net income attributable to WW International, Inc. $90,233  $179,964  
       
Earnings Per Share attributable to WW International, Inc.     
 Basic $1.34  $2.72  
 Diluted $1.30  $2.57  
       
Weighted average common shares outstanding:     
 Basic  67,129   66,074  
 Diluted  69,364   70,117  
       
______     
Note: Totals may not sum due to rounding.  
      
(1) Consists of net “Digital Subscription Revenues” and net “Studio + Digital Fees”. “Digital Subscription Revenues” consist of the fees associated with subscriptions for the Company’s Digital offerings, including the Personal Coaching + Digital product. “Studio + 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 in workshops and via e-commerce, revenues from licensing, magazine subscriptions, publishing and third-party advertising in publications and on the Company's websites and sales from the By Mail product, other revenues, and franchise fees with respect to commitment plans and commissions. 
(3) Consists of cost of revenues and operating expenses for the Company's Digital and Studio + Digital services. 
       


  
WW INTERNATIONAL, INC. AND SUBSIDIARIES 
OPERATIONAL STATISTICS  
(IN THOUSANDS, EXCEPT PERCENTAGES) 
UNAUDITED 
          
  Three Months Ended   
  September 28,  September 29,     
  2019  2018  Variance 
          
Digital Paid Weeks (1)        
North America25,484  23,749  7.3% 
CE 11,526  9,730  18.5% 
UK 2,540  2,222  14.3% 
Other (2)797  719  10.9% 
Total Digital Paid Weeks40,348  36,420  10.8% 
          
Studio + Digital Paid Weeks (1)        
North America12,465  13,898  (10.3%) 
CE 2,701  2,915  (7.3%) 
UK 2,571  2,685  (4.2%) 
Other (2)539  602  (10.5%) 
Total Studio + Digital Paid Weeks18,276  20,099  (9.1%) 
          
Total Paid Weeks (1)        
North America37,949  37,647  0.8% 
CE 14,226  12,644  12.5% 
UK 5,112  4,907  4.2% 
Other (2)1,336  1,321  1.1% 
Total Paid Weeks58,623  56,519  3.7% 
          
End of Period Digital Subscribers (3)        
North America1,947  1,767  10.2% 
CE 878  753  16.7% 
UK 198  166  19.0% 
Other (2)61  56  9.6% 
Total End of Period Digital Subscribers3,085  2,742  12.5% 
          
End of Period Studio + Digital Subscribers (3)        
North America905  985  (8.1%) 
CE 209  224  (7.1%) 
UK 187  193  (2.9%) 
Other (2)42  46  (9.6%) 
Total End of Period Studio + Digital Subscribers1,343  1,449  (7.3%) 
          
Total End of Period Subscribers (3)        
North America2,852  2,751  3.7% 
CE 1,087  977  11.2% 
UK 385  359  7.2% 
Other (2)103  102  0.9% 
Total End of Period Subscribers4,428  4,191  5.7% 
          
______         
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 Personal Coaching + Digital); (ii) “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 Studio + 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 Personal Coaching + Digital, subscribers; (ii) “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 Studio + Digital Subscribers. 
          


  
WW INTERNATIONAL, INC. AND SUBSIDIARIES 
OPERATIONAL STATISTICS  
(IN THOUSANDS, EXCEPT PERCENTAGES) 
UNAUDITED 
          
  Nine Months Ended   
  September 28,  September 29,     
  2019  2018  Variance 
          
Digital Paid Weeks (1)        
North America76,119  71,731  6.1% 
CE 34,672  29,208  18.7% 
UK 7,512  6,832  10.0% 
Other (2)2,363  2,170  8.9% 
Total Digital Paid Weeks120,666  109,941  9.8% 
          
Studio + Digital Paid Weeks (1)        
North America38,843  44,123  (12.0%) 
CE 8,919  9,696  (8.0%) 
UK 7,959  8,380  (5.0%) 
Other (2)1,744  1,899  (8.2%) 
Total Studio + Digital Paid Weeks57,465  64,098  (10.3%) 
          
Total Paid Weeks (1)        
North America114,962  115,854  (0.8%) 
CE 43,591  38,903  12.0% 
UK 15,471  15,212  1.7% 
Other (2)4,107  4,069  0.9% 
Total Paid Weeks178,131  174,039  2.4% 
          
End of Period Digital Subscribers (3)        
North America1,947  1,767  10.2% 
CE 878  753  16.7% 
UK 198  166  19.0% 
Other (2)61  56  9.6% 
Total End of Period Digital Subscribers3,085  2,742  12.5% 
          
End of Period Studio + Digital Subscribers (3)        
North America905  985  (8.1%) 
CE 209  224  (7.1%) 
UK 187  193  (2.9%) 
Other (2)42  46  (9.6%) 
Total End of Period Studio + Digital Subscribers1,343  1,449  (7.3%) 
          
Total End of Period Subscribers (3)        
North America2,852  2,751  3.7% 
CE 1,087  977  11.2% 
UK 385  359  7.2% 
Other (2)103  102  0.9% 
Total End of Period Subscribers4,428  4,191  5.7% 
          
______         
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 Personal Coaching + Digital); (ii) “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 Studio + 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 Personal Coaching + Digital, subscribers; (ii) “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 Studio + Digital Subscribers. 
          


   
WW INTERNATIONAL, INC. AND SUBSIDIARIES  
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES 
(IN THOUSANDS, EXCEPT PERCENTAGES) 
UNAUDITED 
             
         Q3 2019 Variance 
           2019 
       Constant 
 Q3 2019 Q3 2018 2019 Currency 
   Currency Constant   vs vs 
 GAAP Adjustment Currency GAAP 2018 2018 
Selected Financial Data            
Consolidated Company Revenues$348,567  $5,283  $353,849  $365,765  (4.7%) (3.3%) 
Consolidated Digital Subscription Revenues (1)$153,940  $2,629  $156,569  $143,299  7.4% 9.3% 
Consolidated Studio + Digital Fees (2)$144,101  $1,847  $145,948  $168,664  (14.6%) (13.5%) 
Consolidated Service Revenues (3)$298,041  $4,476  $302,516  $311,963  (4.5%) (3.0%) 
Consolidated Product Sales and Other (4)$50,526  $807  $51,333  $53,802  (6.1%) (4.6%) 
             
North America            
Digital Subscription Revenues (1)$101,579  $74  $101,653  $95,664  6.2% 6.3% 
Studio + Digital Fees (2)$108,338  $73  $108,411  $125,282  (13.5%) (13.5%) 
Service Revenues (3)$209,917  $147  $210,064  $220,946  (5.0%) (4.9%) 
Product Sales and Other (4)$33,767  $18  $33,785  $34,335  (1.7%) (1.6%) 
Total Revenues$243,684  $165  $243,849  $255,281  (4.5%) (4.5%) 
             
CE            
Digital Subscription Revenues (1)$42,230  $1,961  $44,191  $37,928  11.3% 16.5% 
Studio + Digital Fees (2)$20,644  $932  $21,576  $25,441  (18.9%) (15.2%) 
Service Revenues (3)$62,874  $2,893  $65,767  $63,369  (0.8%) 3.8% 
Product Sales and Other (4)$8,264  $386  $8,650  $9,025  (8.4%) (4.2%) 
Total Revenues$71,138  $3,279  $74,417  $72,394  (1.7%) 2.8% 
             
UK            
Digital Subscription Revenues (1)$6,608  $379  $6,987  $6,282  5.2% 11.2% 
Studio + Digital Fees (2)$10,733  $615  $11,348  $12,619  (14.9%) (10.1%) 
Service Revenues (3)$17,341  $993  $18,334  $18,901  (8.3%) (3.0%) 
Product Sales and Other (4)$5,592  $321  $5,913  $6,455  (13.4%) (8.4%) 
Total Revenues$22,933  $1,314  $24,247  $25,356  (9.6%) (4.4%) 
             
Other (5)            
Digital Subscription Revenues (1)$3,523  $215  $3,738  $3,425  2.9% 9.1% 
Studio + Digital Fees (2)$4,386  $228  $4,614  $5,322  (17.6%) (13.3%) 
Service Revenues (3)$7,909  $442  $8,351  $8,747  (9.6%) (4.5%) 
Product Sales and Other (4)$2,903  $81  $2,984  $3,987  (27.1%) (25.1%) 
Total Revenues$10,812  $523  $11,335  $12,734  (15.1%) (11.0%) 
             
______
            
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, including the Personal Coaching + Digital product. 
(2) “Studio + 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) “Service Revenues” equal “Digital Subscription Revenues" plus “Studio + Digital Fees”. 
(4) “Product Sales” are sales of consumer products in workshops and via e-commerce, and “Other” are revenues from licensing, magazine subscriptions, publishing and third-party advertising in publications and on the Company's websites and sales from the By Mail product, other revenues, and, in the case of the consolidated financial results and Other reportable segment, includes franchise fees with respect to commitment plans and commissions. 
(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 
             
         YTD 2019 Variance 
           2019  
       Constant 
 YTD 2019 YTD 2018 2019  Currency 
   Currency Constant   vs vs 
 GAAP AdjustmentCurrency GAAP 2018  2018  
Selected Financial Data            
Consolidated Company Revenues$1,080,754  $22,991  $1,103,745  $1,183,735  (8.7%) (6.8%) 
Consolidated Digital Subscription Revenues (1)$459,764  $10,887  $470,651  $432,863  6.2% 8.7% 
Consolidated Studio + Digital Fees (2)$458,771  $8,336  $467,107  $551,499  (16.8%) (15.3%) 
Consolidated Service Revenues (3)$918,535  $19,223  $937,758  $984,362  (6.7%) (4.7%) 
Consolidated Product Sales and Other (4)$162,219  $3,768  $165,987  $199,373  (18.6%) (16.7%) 
             
North America            
Digital Subscription Revenues (1)$303,190  $679  $303,869  $289,002  4.9% 5.1% 
Studio + Digital Fees (2)$342,896  $736  $343,632  $408,200  (16.0%) (15.8%) 
Service Revenues (3)$646,086  $1,415  $647,501  $697,202  (7.3%) (7.1%) 
Product Sales and Other (4)$103,255  $196  $103,451  $121,805  (15.2%) (15.1%) 
Total Revenues$749,341  $1,611  $750,952  $819,007  (8.5%) (8.3%) 
             
CE            
Digital Subscription Revenues (1)$125,999  $8,107  $134,106  $113,431  11.1% 18.2% 
Studio + Digital Fees (2)$68,274  $4,408  $72,682  $83,923  (18.6%) (13.4%) 
Service Revenues (3)$194,273  $12,515  $206,788  $197,354  (1.6%) 4.8% 
Product Sales and Other (4)$30,350  $2,020  $32,370  $39,164  (22.5%) (17.3%) 
Total Revenues$224,623  $14,535  $239,158  $236,518  (5.0%) 1.1% 
             
UK            
Digital Subscription Revenues (1)$20,019  $1,222  $21,241  $19,800  1.1% 7.3% 
Studio + Digital Fees (2)$33,493  $2,057  $35,550  $41,552  (19.4%) (14.4%) 
Service Revenues (3)$53,512  $3,279  $56,791  $61,352  (12.8%) (7.4%) 
Product Sales and Other (4)$18,556  $1,143  $19,699  $23,498  (21.0%) (16.2%) 
Total Revenues$72,068  $4,422  $76,490  $84,850  (15.1%) (9.9%) 
             
Other (5)            
Digital Subscription Revenues (1)$10,556  $878  $11,434  $10,630  (0.7%) 7.6% 
Studio + Digital Fees (2)$14,108  $1,135  $15,243  $17,824  (20.8%) (14.5%) 
Service Revenues (3)$24,664  $2,013  $26,677  $28,454  (13.3%) (6.2%) 
Product Sales and Other (4)$10,058  $403  $10,461  $14,906  (32.5%) (29.8%) 
Total Revenues$34,722  $2,417  $37,139  $43,360  (19.9%) (14.3%) 
             
______            
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 the Personal Coaching + Digital product. 
(2) “Studio + 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) “Service Revenues” equal “Digital Subscription Revenues" plus “Studio + Digital Fees”. 
(4) “Product Sales” are sales of consumer products in workshops and via e-commerce, and “Other” are revenues from licensing, magazine subscriptions, publishing and third-party advertising in publications and on the Company's websites and sales from the By Mail product, other revenues, and, in the case of the consolidated financial results and Other reportable segment, includes franchise fees with respect to commitment plans and commissions. 
(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
             
     Q3 2019 Variance
            2019
            Constant
 Q3 2019 Q3 2018 2019  Currency
   Currency Constant   vs  vs
 GAAP Adjustment Currency GAAP 2018  2018
Selected Financial Data            
Gross Profit$194,769  $3,143  $197,912  $215,394  (9.6%)  (8.1%)
Gross Margin 55.9%    55.9%  58.9%     
             
Selling, General and Administrative Expenses$63,713  $769  $64,482  $61,019  4.4%  5.7%
             
Operating Income$94,729  $1,738  $96,467  $118,860  (20.3%)  (18.8%)
Operating Income Margin 27.2%    27.3%  32.5%     
             
______            
Note: Totals may not sum due to rounding.
             


  
WW INTERNATIONAL, INC. AND SUBSIDIARIES 
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES
(IN THOUSANDS, EXCEPT PERCENTAGES)
UNAUDITED
             
         YTD 2019 Variance 
       2019 
           Constant 
 YTD 2019 YTD 2018 2019 Currency 
   Currency Constant   vs vs 
 GAAP Adjustment Currency GAAP 2018 2018 
Selected Financial Data            
Gross Profit$611,531  $13,707  $625,238  $681,189  (10.2%) (8.2%) 
Gross Margin 56.6%    56.6%  57.5%     
             
Selling, General and Administrative Expenses$188,889  $3,111  $192,000  $182,696  3.4% 5.1% 
             
Operating Income$222,099  $4,971  $227,070  $308,638  (28.0%) (26.4%) 
Operating Income Margin 20.6%    20.6%  26.1%     
             
______            
Note: Totals may not sum due to rounding.            
             


  
WW INTERNATIONAL, INC. AND SUBSIDIARIES 
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES 
(IN THOUSANDS) 
UNAUDITED 
          
          
  Three Months Ended Nine Months Ended 
  September 28, September 29, September 28, September 29, 
   2019   2018   2019   2018  
          
Net Income $47,086  $70,132  $90,233  $179,964  
Interest  33,118   35,506   103,045   107,238  
Taxes  13,123   12,374   26,834   19,580  
Depreciation and Amortization  10,850   10,820   33,543   32,594  
Stock-based Compensation  5,243   5,671   14,927   15,346  
EBITDAS $109,420  $134,503  $268,582  $354,722  
          
______         
Note: Totals may not sum due to rounding.       
          


For more information, contact:

Investors:
Corey Kinger
VP Investor Relations
212.601.7569
corey.kinger@ww.com

Media:
Nicole Penn
VP Corporate Communications
212.817.4341
nicole.penn@ww.com