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WW Worldwide and advisors to its lenders have reportedly taken a step in speaking about probably restructuring the corporate’s debt.
The Wall Avenue Journal reported, citing unnamed sources, that WeightWatchers, which turned WW Worldwide a number of years in the past, and the lender advisors just lately entered right into a confidentiality settlement.
The corporate’s monetary forecasts and technique have been on the middle of preliminary restructuring talks between the lender advisors and WeightWatchers, in accordance with the outlet.
An indication for Weight Watchers is displayed at an workplace in Decrease Manhattan, Oct. 19, 2015. (Brendan McDermid / Reuters)
The advisers are reportedly working to parse out what programs of motion might be out there to lenders with the knowledge.
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FOX Enterprise reached out to the corporate for touch upon The Journal’s report.
WeightWatchers’ complete liabilities quantity to $1.69 billion, together with $1.4 billion in web long-term debt, in accordance with its most up-to-date quarterly report.
In early November, then-CFO Heather Stark advised analysts and traders the corporate had “sufficient liquidity for our working capital needs” and “attractive debt terms with no maturities for our term loan or senior notes until 2028 and 2029.”
“However, we acknowledge that our debt burden is significant with our net debt to adjusted EBITDA slivered ratio at 10.4x at the end of the third quarter,” she mentioned. “As such, we have recently appointed advisors to assist us in the evaluation of options related to our overall capital structure.”
The corporate just lately disclosed in a Securities and Change Fee submitting it had borrowed about $121.3 million “under the senior secured revolving credit facility” that it has had since 2021 to “provide financial flexibility.”
WEIGHTWATCHERS CEO SIMA SISTANI OUT IN ABRUPT EXIT, EMBRACED WEIGHT LOSS DRUGS
“We continue to actively evaluate our capital structure and intend to explore transactions to strengthen our balance sheet and increase our financial flexibility,” WeightWatchers mentioned within the submitting. “We look forward to engaging with our lenders and bondholders in the coming months.”
The aim of borrowing these funds was “not to address near term liquidity requirements,” it additionally mentioned.
The corporate has been round since 1963. It has lengthy provided weight-loss and weight-management packages and, extra just lately, has delved into entry to weight-loss drugs amid a surge in recognition of individuals utilizing these medication to slim down.
The WeightWatchers emblem is displayed on a smartphone display. (Picture Illustration by Rafael Henrique/SOPA Photographs/LightRocket by way of / Getty Photographs)
WeightWatchers generated $601.5 million in web revenues over the primary three quarters of 2024, together with $192.9 million within the third quarter. It has seen a web lack of $370.8 million over the identical nine-month interval.
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“While our results in the third quarter were broadly on track with expectations, it’s clear we have significant work ahead to change the trajectory of the business,” interim CEO Tara Comonte mentioned throughout the firm’s earnings name in November. “This is an industry undergoing massive transition and as a result, WeightWatchers has experienced meaningful disruption over recent years. However, I am optimistic about our ability to lay a path to future growth.”
