GNC Holdings Inc. announced Monday it is undertaking a strategic review whose options could include a sale of the company.
The health and wellness retailer said it is also considering accelerated refranchising strategies, partnerships and other collaborations, and capital structure optimization. The announcement comes on the heels of disappointing first quarter results.
“After careful consideration, including discussions with a range of shareholders, we believe it is an appropriate time to undertake a comprehensive review of the company’s strategic and financial alternatives,” stated GNC chairman Michael F. Hines. “We are in the early stages of a broad review and will take the time we need to thoroughly evaluate our opportunities to achieve the best result for our shareholders, business partners, and associates. While the review is ongoing, GNC will continue to act with the necessary urgency to deliver improved financial performance by addressing our near-term challenges and continuing to execute our strategic initiatives.”
In the first quarter, GNC reported earnings of $50.8 million, compared with $63.3 million in the same quarter a year ago. Revenue fell to $668.9 million, from $681.3 million a year ago.
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GNC also said it would 84 corporate-owned stores to a franchising company, part of a larger effort to sell 1,000 company-owned stores over the next four years.
As of March 31, 2016, GNC had more than 9,000 locations, of which more than 6,700 retail locations are in the United States and franchise operations in approximately 50 countries.
Date: May 2, 2016