Weight Watchers International (WTW) - Get Report shares plunged Wednesday after it forecast sharply lower sales and earnings for 2019 but noted that celebrity backer Oprah Winfrey would front the group's upcoming promotional campaign.
Weight Watchers said earnings for the three months ending in December came in at 63 cents per share, topping the Street forecast but falling nearly 31% from the same period last year. Group sales rose 5.7% to $330.4 billion, the company said, but missed the consensus forecast of $347 million.
Looking into 2019, Weight Watchers sees full-year revenues in the region of $1.4 billion, a 7.5% decline that would fall notably shy of Street estimates, with earnings in the region of $1.25 to $1.50, less than half of the current consensus forecast.
After an outstanding year for WW in 2018, our start to 2019 and winter recruitment performance has been very disappointing, as reflected in the financial outlook we are providing today," CEO Mindy Grossman told investors on a conference call late Tuesday. "In our spring marketing, our ambassadors will be featured in a multi-platform campaign in most major markets."
"Oprah will play a central role in our marketing campaigns in the U.S., Canada and Australia, bringing to life a clear message on how WW is the program for everyone who wants to lose weight and get healthier," Grossman added.
Weight Watchers shares were down 32.8% to $19.87 on Wednesday.
Winfrey, 65, owns around 8% of Weight Watchers International after selling a small portion of her stake last March and donating much of the portions to her philanthropic Oprah Winfrey foundation.
"I believe in Weight Watchers and I'm inspired every day by the millions of people around the world who are leading healthier and more fulfilling lives," the talk show host said at the time.