WeightWatchers 2009 Annual Report Download - page 3

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DEAR SHAREHOLDERS
There is little doubt that 2009 was one of the most challenging
economic environments most of us have witnessed in our lifetime.
While Weight Watchers was certainly not immune to the consumer
pullback in discretionary spending, we were able to weather the
storm by pursing aggressive cost savings initiatives across our
business and taking actions to drive member recruitment and
retention. We launched a new program innovation in January
2009 in North America, the United Kingdom and Australia and
utilized promotion and value messaging to positively impact
near-term enrollment activities. As a result, we were able to
deliver results that were well within the fi nancial guidance we
provided at the beginning of the year despite the weak and
uncertain economic climate.
In 2009, we continued to make signifi cant progress on the strategic
initiatives designed to drive enrollments and attendance in the long
term, attract Weight Watchers Online subscribers and enliven our
brand – all while keeping costs carefully in check. For the year,
revenues were down single digits at $1.4 billion with much of
the decline coming from foreign currency translation. Worldwide
attendance in our meetings exceeded 54 million, and we ended
the year with 763 thousand WeightWatchers.com subscribers, up
12% from the prior year. On the expense side of the equation, we
actively managed our cost structure, by streamlining processes
and improving the alignment of management responsibilities. These
efforts, combined with the benefi t of our variable cost margin
structure, allowed us to maintain the strong margin profi le of our
business and drive free cash fl ow. Our 2009 operating income was
a sound $357 million, net income was a solid $177 million, and we
generated cash fl ow from operations of $265 million. We remain
dedicated to delivering returns for shareholders, evidenced by our
commitment to our quarterly dividend, under which we paid out $54
million to shareholders in 2009.
At Weight Watchers, our aim is to encourage more people to realize
that a healthier lifestyle is a necessity, not a luxury. To this end, we
[OPPOSITE PAGE, CLOCKWISE FROM LEFT ]
Michelle
Meetings Member | United States
Before: 233.2 lbs | After: 146 lbs
Lost: 87.2 lbs
Tanja
Meetings Member | Germany
Before: 208.3 lbs | After: 169.5 lbs
Lost: 38.8 lbs
Jenny
Online Subscriber | United States
Before: 166 lbs | After: 138 lbs
Lost: 28 lbs
Helen
Meetings Member | Australia
Before: 207.5 lbs | After: 163.4 lbs
Lost: 44.1 lbs
Eddie
Online Subscriber | United States
Before: 225 lbs | After: 152 lbs
Lost: 73 lbs
At Weight Watchers, our aim is
to encourage more people to realize
that a healthier lifestyle is a necessity,
not a luxury.