Weight Watchers International has released its results for the third quarter of 2006 and also announced the decision of Linda Huett to retire as president and CEO of the company at year-end to be replaced by her successor David Kirchhoff.
For the third quarter, net revenues increased US$27.3m to $284.8m, from $257.5m in the third quarter of 2005. Net income was $50.6m, up from $49.5m in the third quarter of 2005.
The company said that Huett, 62, who has been with the company for nearly 23 years, the last seven as its president, CEO and director, has informed the board of her decision to retire from those positions at the end of the year.
Kirchhoff, currently president and CEO of WeightWatchers.com as well as the firm’s chief operating officer for Europe and Asia, will succeed her and will also join the company’s board from 31 December 2006, the first day of the its 2007 fiscal year.
In addition, the company announced the promotion of Thilo Semmelbauer, currently chief operating officer for North America, to the new global position of chief operating officer.
Huett said: “It is never easy to decide when is the right time to retire from a position and a company you love. In the summer of 1999, when I agreed to accept this role, I left my three teenage daughters and those I love most in Britain and I moved to New York alone. It has always been my intention to eventually be able to spend more significant time back in the UK with my family, which is just not achievable while remaining head of Weight Watchers International.
“This is purely a personal decision. My passion for Weight Watchers has never diminished and my belief in our success has never wavered. I am very proud of what we as a team have achieved under my leadership and of the initiatives we have put in motion that will take the Company to the next level in the years ahead.”
For the nine month 2006 period net at Weight Watchers, revenues increased $47.8m to $947.9m, from $900.1m in the first nine months of 2005, while net income was $165.5m, up from $135.6m in the nine months in October 2005.
Commenting on the company’s results and full-year guidance, Huett said: “I am pleased that our members’ response to the Monthly Pass commitment plan in the US is exceeding our expectations, that our UK operations returned to growth, and that the company experienced solid overall revenue growth in the third quarter despite disappointing results from our continental European operations.
“As is our normal practice at this time of year, we are narrowing our guidance range. For the full-year 2006, our guidance is $2.04 to $2.08 per fully diluted share, including $0.07 of expenses related to non-cash stock-based compensation and excluding $0.01 of charges associated with the early extinguishment of debt.”
During the seven years of Huett’s leadership the weight management firm has seen revenue growth from less than $400m seven years ago to more than $1.2bn today, an increase in company-owned meeting operations in the US from 42% seven years ago to 82% today and the acquisition and integration of WeightWatchers.com.
Huett’s first involvement with the company was in the UK in 1983 as a member. Within a year, she became a Leader and, in 1986, she was named the UK’s National Training Manager, and took full responsibility for the UK business in 1992.
She will remain with the company in an advisory capacity through 2007.
Kirchhoff joined WeightWatchers.com in January 2000, and has subsequently served as its CFO and was president and CEO of WeightWatchers.com at the time of its acquisition by the company. He has also became the company’s chief operating officer for Europe and Asia in September 2005.
Prior to joining WeightWatchers.com, he was director of corporate strategy and development for PepsiCo.