Weight Watchers International Inc (WTW)

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Weight Watchers International (WTW)

Q2 2013 Earnings Call

August 01, 2013 5:00 pm ET


Lori Scherwin

James R. Chambers

Nicholas P. Hotchkin - Chief Financial Officer and Principal Accounting Officer


Glen J. Santangelo - Crédit Suisse AG, Research Division

Jerry R. Herman - Stifel, Nicolaus & Co., Inc., Research Division

Gregory R. Badishkanian - Citigroup Inc, Research Division



Ladies and gentlemen, welcome to Weight Watchers International Second Quarter 2013 Earnings Teleconference Call. [Operator Instructions] As a reminder, this conference call is being recorded today, August 1, 2013. At this time, I would like to turn the call over to Lori Scherwin of Weight Watchers International. Please go ahead.

Lori Scherwin

Thank you, operator and thank you, to everyone, for joining us today for Weight Watchers International Second Quarter 2013 Conference Call.

With us on the call are Jim Chambers, our newly appointed President and Chief Executive Officer; and Nick Hotchkin, Chief Financial Officer.

At about 4 p.m. Eastern Time today, the company issued a press release reporting the second quarter financial results of fiscal 2013. 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 www.weightwatchersinternational.com.

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. I would now like to turn the call over to Jim. Please go ahead.

James R. Chambers

Thank you, and good afternoon, everyone. I'm happy to be with you on the call today and look forward to meeting you in due course. I've enjoyed partnering with Dave since I joined this January and would like to congratulate him on his long-standing contributions to the company and wish him all the best. His leadership at the company will be missed, and we value the seeds he has planted for our growth agenda. I'm also honored by the Board's confidence in my ability, and I'm thrilled by the opportunity to lead this company forward with a talented team by my side.

I trust that you've seen our earnings announcement. Current results and the near-term outlook, which Nick will walk you through in more detail, fall short of our aspirations. While I am proud of the progress the team has made on the cost front, we need to be more aggressive and more innovative in our efforts to drive recruitment and top line results in what is proving to be a very challenging operating environment. While we're still evaluating elements of our long-term strategic plan, which we'll be prepared to share at the November 6 Strategic Outlook Investor Day, I'm pleased to have this opportunity to discuss my early observations with you today. Appreciating I have been at the company for a little over 6 months and I'm brand-new to this role, I will not be sharing a detailed strategy blueprint on this call but look forward to doing so in November.

I'd like to start by sharing some perspective on my background and relevant experience. I've spent my entire career in, or supporting consumer facing businesses. Although nearly half my experience has been in general management, I worked in multiple functions from marketing, to operations, to corporate planning and even spent a couple of years as Head of Information Technology a while back. I've had the privilege of leading some wonderful organizations in a variety of segments from food, to beverages, to market information services. I've been accountable for developing winning strategies and driving execution for some of the world's largest and best-known brands including OREO, Trident and Remy Martin. For most of those years, I have worked in companies that were dependent on large field organizations, and I'm a deep believer in the power and strategic potential of an aligned and well-supported field-centric model.

I joined Weight Watchers for 2 principal reasons: mission and business potential. I have a personal alignment with the mission of taking the best science has to offer and translating it into something that works for consumers in their daily lives, and I believe deeply in the potential of this company and the power of the Weight Watchers brand. 6 months in, my alignment with the mission and belief in the potential of the business are even stronger now.

I also want to make a few comments on my high-level learnings today. Despite the current tough climate, I've enjoyed my time at Weight Watchers, and I'm encouraged by the prospects to build the business going forward. Over the last 6 months, we've focused on 3 things: dealing with our near-term performance, defining our strategic agenda and strengthening our organization.

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