What happened
Shares of Vitamin Shoppe (VSI +0.00%) have gotten destroyed today, down by 35% as of 2:30 p.m. EDT, after the company reported disappointing second-quarter earnings.
So what
Revenue in the second quarter fell to $304.8 million, missing the consensus estimate of $314.7 million in sales. Non-GAAP earnings per share came in at $0.23, also well below the Street's forecast of $0.39. On a GAAP basis, the company lost $6.73 per share due to $168.1 million in impairment charges as well as a $13.7 million charge related to its Nutri-Force turnaround. There was also $3.4 million in costs "related to strategic initiatives."
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Comparable-store sales fell 8.3%, largely driven by declines in the company's sports-related product categories.
Now what
In a statement, CEO Colin Watts said:
The results during the quarter were disappointing and the challenges are clear. The market environment evolved more quickly than we anticipated particularly in the Sports categories. We have taken decisive actions to improve our performance directly focused on customer acquisition, price/value and customer retention with programs rolled out across the chain. Additionally, we continue to make progress on our reinvention initiatives and further cost restructuring programs that will help improve results well into 2018.
Guidance was also disappointing, as Vitamin Shoppe revised its sales outlook downward. Comps for full-year 2017 are now expected to be "negative mid-single digits," worse than its prior outlook provided in May of comps being "negative low to mid single digit."
