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The Oprah effect can't stop Weight Watchers shedding members

The turnaround has started, but the firm is still some way off its target weight

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The fourth quarter results were not the figures Weight Watchers had been hoping for.

While its customers get slimmer, the Oprah Winfrey-backed weigh loss firm Weight Watchers International (NYSE:WTW) keeps seeing its losses expand at an alarming rate.

The New York-based firm posted a fourth-quarter loss of $11.3mln, or 18 cents per share, compared to a profit of $4.4mln, or 8 cents per share, a year earlier.

However, excluding costs of the Winfrey deal and restructuring charges, the most recent quarter's loss was 3 cents, the company said.

Analysts had been expecting earnings of 2 cents per share.

Weight Watchers has been shedding members recently, and its number of clients slimmed again in the fourth quarter, though less than the previous quarter, after Winfrey became the company’s marketing partner and board member.

Jim Chambers, chief executive, said: “The partnership with Oprah Winfrey is off to a strong start. Our transformation momentum is building, with positive recruitments this winter season setting a solid foundation for revenue growth and increased profitability.”

For the year to January 2, Weight Watchers earned $32.9mln, or 56 cents per share, on revenue of $1.16bn.

For this year, Weight Watchers expects to reach a target profit of 70 cents to $1 per share.

Shares, which have lost 31% so far this year, dropped more than $3, or 20% in post-market trading, to $12.30. 

Quick facts: Weight Watchers International

Price: 37.98 USD

NASDAQ:WW
Market: NASDAQ
Market Cap: $2.56 billion
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