FORT WASHINGTON, Pa.--(BUSINESS WIRE)--Jul 30, 2018--Nutrisystem, Inc. (Nasdaq: NTRI), a leading provider of health and wellness and weight management products and services including Nutrisystem® and South Beach Diet® brands, today reported financial results for the quarter and six months ended June 30, 2018.

Dawn Zier, President and Chief Executive Officer, stated, “We’re pleased to have exceeded second quarter guidance. Our multi-brand strategy, supported by two highly recognized names in the health and wellness industry, is working well and provides a strong, scalable platform for future growth.”

Ms. Zier added, “Our announcements around the recently launched DNA Body Blueprint™ and the branded lines of vitamin packs showcase our focus on science-backed personalized nutrition to drive not only weight loss, but overall health. We believe our efforts to date, coupled with second-half investments in our innovation pipeline, branding and digital media expansion, will pave the way for meaningful growth and profitably expand customer reach in 2019 and beyond.”

The following are key financial highlights for the period. Reconciliations of certain GAAP to non-GAAP measures are provided later in this press release.

Second Quarter 2018 Compared to Second Quarter 2017

Revenue was $191.3 million compared to $194.9 million. Gross margin was 53.8% compared to 54.3%. Net income was $26.1 million compared to $24.4 million. Diluted income per common share was $0.87 compared to $0.80. Adjusted EBITDA was $41.0 million compared to $42.5 million. Company repurchased $15 million of common stock during the second quarter of 2018 for a total of $25 million during the first six months of 2018. The Board of Directors has declared a quarterly dividend of $0.25 per share, payable August 20, 2018 to stockholders of record as of August 9, 2018.

Mike Monahan, Chief Financial Officer, commented, “Our second quarter and year-to-date results demonstrate the strength of our business model as we continued to generate solid EBITDA. We were able to repurchase $25 million of stock in the first six months of the year and will continue to use our strong free cash flow to enhance the long-term value of our company.”

Third Quarter and Updated Full Year 2018 Guidance

The Company’s third quarter and full year 2018 guidance is outlined below. Reconciliations of certain GAAP to non-GAAP measures are provided later in this press release.

Third quarter revenue is expected to be in the range of $162 to $167 million, net income between $14.9 and $16.5 million, diluted income per common share between $0.50 and $0.55, and adjusted EBITDA between $25.5 and $27.5 million. Full year 2018 revenue is expected to be in the range of $693 to $708 million, net income between $62.4 and $65.5 million compared to the previous range of $61.8 to $64.8 million, diluted income per common share between $2.07 and $2.17 compared to the previous range of $2.04 to $2.14, and adjusted EBITDA between $106.5 and $110.5 million. The South Beach Diet brand is expected to contribute approximately $70 million in revenue in 2018.

Conference Call and Webcast

Management will host a conference call to discuss second quarter 2018 financial results today at 5:00 PM Eastern time. The conference call will include remarks from President and Chief Executive Officer, Dawn Zier, Chief Financial Officer, Mike Monahan, and Chief Marketing Officer, Keira Krausz. A webcast of the conference call will be available live on the Investor Relations section of Nutrisystem's website at www.nutrisystem.com. Interested parties unable to access the conference call via the webcast may dial 877-407-3982. A replay of the conference call will be available on the Company’s website for 30 days following the event and can be accessed at 844-512-2921 using replay pin number 13680849.

Non-GAAP Financial Measures

Within this press release, the Company makes reference to a non-GAAP financial measure (adjusted EBITDA) which has a directly comparable GAAP financial measure (net income). EBITDA is defined as net income excluding interest, income taxes and depreciation and amortization. Adjusted EBITDA is defined as EBITDA excluding non-cash employee compensation expense. The Company excludes non-cash employee compensation expense because it is a non-cash expense that is not reflective of the ongoing cash expense of the Company. Adjusted EBITDA is provided so that investors have the same financial data that management uses to assess the Company’s operating results with the belief that it will assist the investment community in properly assessing the ongoing performance of the Company for the periods being reported and future periods. The presentation of this additional information is not meant to be considered a substitute for measures prepared in accordance with GAAP.

Forward-Looking Statements

Information provided and statements contained in this press release that are not purely historical, such as third quarter and updated full year 2018 guidance, and the Company’s financial and operational outlook, are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, Section 21E of the Securities Exchange Act of 1934 and the Private Securities Litigation Reform Act of 1995. Such forward-looking statements only speak as of the date of this press release and the Company assumes no obligation to update the information included in this press release. Statements made in this press release that are forward-looking in nature may involve risks and uncertainties. Accordingly, readers are cautioned that any such forward-looking statements are not guarantees and are subject to certain risks, uncertainties and assumptions that are difficult to predict, including, without limitation, risks relating to cybersecurity breaches, risks that consumer spending may decline or that U.S. and global macroeconomic conditions may worsen resulting in reduced demand for the Company’s products, risks relating to changes in consumer preferences away from the Company’s food offerings including its pre-packaged foods, risks relating to the effectiveness and efficiency of the Company’s advertising campaigns and marketing expenditures, including existing brands and the launch of new brands, which may not result in increased revenue or generate sufficient levels of brand name and program awareness, risks if the Company is unable to obtain sufficient quantities, quality and variety of food products in a timely and low-cost manner from its food vendors, risks of exposure to product liability claims if the use of the Company’s products results in illness or injury, risks if the Company becomes subject to health or advertising related claims from its customers, competitors or governmental and regulatory bodies, and risks relating to increased competition from other weight management providers. For further details and a discussion of these risks and uncertainties, see the Company's periodic reports, including the annual report on Form 10-K, quarterly reports on Form 10-Q and current reports on Form 8-K, filed with or furnished to the Securities and Exchange Commission and available at www.sec.gov. Although the Company believes that the expectations reflected in such forward-looking statements are reasonable as of the date made, expectations may prove to have been materially different from the results expressed or implied by such forward-looking statements. Unless otherwise required by law, the Company also disclaims any obligation to update its view of any such risks or uncertainties or to announce publicly the results of any revisions to the forward-looking statements made in this press release.

About Nutrisystem, Inc.

Nutrisystem, Inc. (Nasdaq:  NTRI ) is a leading provider of health and wellness and weight management products and services including Nutrisystem® and South Beach Diet® brands, having helped millions of people lose weight over the course of more than 45 years. The Company’s multi-brand approach to weight management includes multiple plans for 2018. For more information, go to  NutrisystemNews.com and Newsroom.SouthBeachDiet.com.

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