GNC Holdings, Inc. (GNC) swung to a net loss for the quarter ended Dec. 31, 2016. The company has made a net loss of $433.45 million, or $ 6.35 a share in the quarter, against a net profit of $42.92 million, or $0.54 a share in the last year period. On the other hand, adjusted net income for the quarter stood at $4.92 million, or $0.07 a share compared with $46.69 million or $0.59 a share, a year ago.
Revenue during the quarter dropped 9.41 percent to $569.93 million from $629.11 million in the previous year period. Gross margin for the quarter contracted 642 basis points over the previous year period to 29.86 percent. Operating margin for the quarter stood at negative 78.63 percent as compared to a positive 13.31 percent for the previous year period.
Operating loss for the quarter was $448.13 million, compared with an operating income of $83.71 million in the previous year period.
Bob Moran, Interim chief executive officer, commented, "GNC's performance in the fourth quarter, while well below expectations, does not reflect the fundamental changes we have made to the business model. Customers are responding well to the new model, which launched in late December and includes simplified, more competitive pricing and new loyalty programs. We are aware that the changes we have made have short-term financial impacts and while it is still in the early days, and it will take time for our investments to bear fruit, we are encouraged by the trends we're seeing and believe the One New GNC can help the company return to profitable growth."
Operating cash flow drops significantly
GNC Holdings, Inc. has generated cash of $208.20 million from operating activities during the year, down 41.28 percent or $146.34 million, when compared with the last year.
The company has spent $22.42 million cash to meet investing activities during the year as against cash outgo of $45.65 million in the last year.
The company has spent $207.54 million cash to carry out financing activities during the year as against cash outgo of $384.46 million in the last year period.
Cash and cash equivalents stood at $34.46 million as on Dec. 31, 2016, down 38.96 percent or $22 million from $56.46 million on Dec. 31, 2015.
Working capital decreases marginally
GNC Holdings, Inc. has witnessed a decline in the working capital over the last year. It stood at $491.46 million as at Dec. 31, 2016, down 4.60 percent or $23.69 million from $515.15 million on Dec. 31, 2015. Current ratio was at 2.60 as on Dec. 31, 2016, down from 2.85 on Dec. 31, 2015.
Debt moves up
GNC Holdings, Inc. has witnessed an increase in total debt over the last one year. It stood at $1,540.45 million as on Dec. 31, 2016, up 6.30 percent or $91.27 million from $1,449.18 million on Dec. 31, 2015. Total debt was 74.47 percent of total assets as on Dec. 31, 2016, compared with 56.79 percent on Dec. 31, 2015.
Disclaimer: Please note that this is an auto-generated article. IRIS does not guarantee the accuracy, adequacy or completeness of any information and is not responsible for any errors or omissions or for the results obtained from the use of such information. IRIS especially states that it has no financial liability whatsoever to any user on account of the use of information provided on its website. For queries contact: editor@irisindia.net
