WeightWatchers mentioned on Tuesday it’s submitting for Chapter 11 chapter safety to get rid of $1.15bn (€1bn) in debt and give attention to its transition right into a telehealth providers supplier.
Mother or father WW Worldwide Inc. mentioned it has the assist of practically three-quarters of its debt holders. It expects to emerge from chapter inside 45 days, if not sooner.
WeightWatchers, which was based greater than 60 years in the past, has seen its income decline in current quarters.
In 2023, the corporate moved into the prescription drug weight reduction enterprise — notably with the $106 million (€93.3 million) acquisition of Sequence, now WeightWatchers Clinic, a telehealth service that helps customers get prescriptions for medication like Ozempic, Wegovy and Trulicity.
Credit score rankings agency S&P World Rankings downgraded WeightWatchers in February, saying its subscriber base has aged and the model shouldn’t be well-liked among the many youthful generations.
WeightWatchers has greater than $1.4bn (€1.23bn) of loans and bonds that come due in 2028 and 2029, reported the Wall Road Journal firstly of April. The newspaper broke the information first that the well being and wellness firm is making ready to file for chapter within the coming months.
WeightWatchers’ newest earnings report on Tuesday confirmed that first-quarter income declined by 10% whereas its loss on an adjusted foundation totalled 47 cents per share. Nonetheless, scientific subscription income — or weight-loss medicines — jumped 57% yr over yr to $29.5 million (€25.97 million).
In September, WW Worldwide CEO Sima Sistani resigned, and the New York firm named Tara Comonte, a WeightWatchers board member and former Shake Shack government, interim chief government.
Comonte, now CEO, mentioned in a press release on Tuesday: “Because the dialog round weight shifts towards long-term well being, our dedication to delivering essentially the most trusted, science-backed, and holistic options —grounded in group assist and lasting outcomes — has by no means been stronger, or extra necessary.”
Shares of the corporate have traded at beneath $1 since early February. In after-hours buying and selling within the US, the inventory plunged by half to 39 cents.
The chapter submitting was made within the US Chapter Court docket for the District of Delaware.