NutriSystem Inc. (NASDAQ: NTRI) reported its fourth quarter and full year financial results for fiscal year 2017. The weight loss service company beat both revenue and earnings, but shares plummeted by 27 percent during Monday’s after-hours on the company’s weak full-year guidance.
For the fourth quarter, NutriSystem reported revenue of $131.2 million, increasing 20 percent year over year, and beating analysts’ estimates of $129 million. The company reported an EPS of $0.42, while analysts’ forecasted for $0.40 per share.
For the full year of 2017, NutriSystem reported revenue of $697 million, increasing 28 percent year over year, and a diluted EPS of $1.90, increasing 60 percent year over year.
NutriSystem also raised its quarterly dividend by 43 percent to $0.25 due to strong revenue and earnings growth in the year, as CFO Mike Monahan forecasts for stronger cash flow in 2018.
As the new year rings in, weight loss related companies usually see increased sales due to new years resolutions, but NutriSystem’s diet loss program did not excel as expected.
“Our Nutrisystem brand had a slower than expected start to Diet Season as our campaign failed to generate more new customers versus last year.” said Dawn Zier, President and Chief Executive Officer. “Our highly successful creative approach fatigued and we are in the process of revamping the advertising and rebalancing media as a result.”
For the first quarter in 2018, NutriSystem forecasts revenue in the range of $204 to $209 million and a diluted EPS between $0.03 and $0.08, well below analysts’ forecasts of $0.28.
“We view this as a temporary and fixable setback and anticipate returning to meaningful growth in 2019. All other key metrics around the business are sound and continuing to grow.” said Zier.