PITTSBURGH — GNC, which has faced government scrutiny about the nutritional supplements it sells, said Thursday that its profit fell more than 9 percent during its first quarter as sales slipped. The company also lowered its earnings and revenue outlooks for the year.
Its shares fell more than 8 percent in midday trading.
The retailer reached a deal last month with New York Attorney General Eric Schneiderman to test its herbal supplements to confirm their authenticity. The deal came after Schneiderman’s office sent letters to GNC and other retailers in February, alleging that store brand herbal supplement products weren’t what they said they were. Other attorneys general around the country have asked Congress to investigate the herbal supplements industry.
On Thursday, GNC reported first-quarter profit of $63.3 million, or 72 cents per share, down from $69.9 million, or 75 cents per share, a year ago.
Earnings, adjusted for non-recurring costs, were 75 cents per share. The results fell short of Wall Street expectations. The average estimate of analysts surveyed by Zacks Investment Research was for earnings of 81 cents per share.
The Pittsburgh-based company said revenue fell less than 1 percent to $670.2 million in the period, also missing Street forecasts. Analysts surveyed by Zacks expected $695.4 million.
The company now expects full-year earnings in the range of $3 per share to $3.15 per share, compared with its previous forecast between $3.10 per share and $3.15 per share. Analysts expected earnings of $3.15 per share, according to FactSet.
It now expects full-year revenue growth in the low single digits. It previously expected a “mid single digit increase.” Analysts expected revenue to rise 4.4 percent to $2.73 billion, according to FactSet.
GNC Holdings Inc., based in Pittsburgh, operates more than 8,900 stores around the world.
Its shares fell $3.91, or 8.3 percent, to $43 in midday trading. They have fallen more than 4 percent over the past year.
Elements of this story were generated by Automated Insights (http://automatedinsights.com/ap) using data from Zacks Investment Research. Access a Zacks stock report on GNC at http://www.zacks.com/ap/GNC
Via Associated Press
