Weight Watchers International Inc (NASDAQ:WW) Q1 2019 Earnings Conference Call - Final Transcript

May 02, 2019 • 05:00 pm ET


Weight Watchers International Inc (NASDAQ:WW) Q1 2019 Earnings Conference Call - Final Transcript


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Good afternoon, and welcome to the WW First Quarter 2019 Earnings Conference Call. [Operator Instructions] Please note, this event is being recorded.

I would now like to turn the conference over to Corey Kinger, Investor Relations. Please go ahead.

Corey Kinger

Thank you, Andrea, and thank you to everyone for joining us today for WW's first quarter 2019 conference call. At about 4 or 5 p.m. Eastern Time today, we issued a press release reporting our first quarter 2019 results. The purpose of this call is to provide investors with some further details regarding the Company's financial results as well as to provide a general update on the Company's progress. The press release is available on the Company's corporate website located at corporate.ww.com. Supplement and investor materials are also available on the Company's corporate website in the Investors section under presentation and events. Reconciliations of non-GAAP measures disclosed on this conference call to the most directly comparable GAAP financial measures are also available as part of the press release.

Before we begin, let me remind everyone that this call will contain forward-looking statements. Investors should be aware that any forward-looking statements are subject to various risks and uncertainties that could cause actual results to differ materially from those discussed here today. These risk factors are explained in detail in the Company's filings with the Securities and Exchange Commission. Please refer to these filings for a more detailed discussion of forward-looking statements and the risks and uncertainties of such statements. All forward-looking statements are made as of today and except as required by law the Company undertakes no obligation to publicly update or revise any forward-looking statements whether as a result of new information, future events or otherwise.

Joining today's call are Mindy Grossman, President and CEO; and Nick Hotchkin, CFO, Operating Officer, North America and President, Emerging Markets.

I will now turn the call over to Mindy.

Mindy F. Grossman

Thank you, Corey. Good afternoon, everyone. I'm glad to be speaking with you today. I'm pleased to say that year-over-year member recruitment trends have improved in both February and March, but still below 2018 levels. We stabilized the business by taking quick action to improve and optimize our marketing effectiveness. This resulted in attending the first quarter 4.6 million subscribers, above our prior expectations and up 1% from the first quarter of 2018. As a result of these improved recruitment trends and strong cost management, we delivered Q1 results ahead of our expectation. As we discussed on the call in February, our 2019 winter campaign did not recruit to the levels we had intended. We attributed this to three main factors. First, we were lapping the phenomenal success of the launch of our WW Freestyle program last year and it proved to be more difficult comp than we expected; second, the launch of our new global brand rollout and campaign needed a more overt bridge between WW and Weight Watchers and between weight loss and wellness; and third, as much as we are pleased with our