Vitamin Shoppe Posts Downbeat Q1 Earnings, Lowers Forecast

Shares of

tumbled more than 7 percent in pre-market trading after the company reported weaker-than-expected first-quarter results and lowered its full-year forecast. For the year, Vitamin Shoppe now projects earnings of $2.05 to $2.25 per share, on sales growth of 6 percent to 8 percent. The company had earlier expected earnings of $2.36 to $2.46 per share on sales growth of 10 percent. The North Bergen, New Jersey-based company posted a quarterly profit of $18.7 million, or $0.63 per share, versus a year-ago profit of $20.5 million, or $0.67 per share. Its revenue climbed 9.4 percent to $336.8 million from $307.8 million. However, analysts were estimating a profit of $0.73 per share on revenue of $345 million. The average estimate among 6 Estimize users was for earnings of $0.74 per share and revenue of $342.23 million. Its sales at comparable stores gained 1.2 percent in the quarter. Cost of goods sold climbed 12.0 percent to $222.2 million. Gross profit rose 4.7 percent to $114.6 million. Expenses climbed 11 percent, while gross margin shrank to 34 percent from 35.6 percent. During the quarter, Vitamin Shoppe repurchased 400,000 shares of its common stock for a total price of $16.5 million. Vitamin Shoppe's board also announced a new $100 million share buyback. Colin Watts, Chief Executive Officer of the Company said, "Our first quarter results were both below our expectations and were disappointing due to a combination of external headwinds and margin pressure. We are working quickly to strengthen the core business and develop new growth opportunities. As a trusted, leading health and wellness retailer, we have confidence in our ability to deepen our relationships with our customers and to improve business performance going forward." Vitamin Shoppe shares slipped 7.23 percent to $39.25 in pre-market trading.