FORT WASHINGTON, Pa.--(BUSINESS WIRE)--Nutrisystem, Inc. (NASDAQ: NTRI), a leading provider of weight management products and services, today reported financial results for the quarter ended June 30, 2016.

Dawn Zier, President and Chief Executive Officer, stated, “We are pleased with the double-digit revenue growth, improved profitability, and gross margin expansion that we delivered in the second quarter. Demand for our products and revenue per customer continue to grow, demonstrating positive consumer reception to our premium products, flexible options, and shakes.”

Ms. Zier added, “We are on track to officially launch the South Beach Diet program for Diet Season 2017 and will continue to bring innovative new products to market in the coming year. These initiatives, coupled with the proven strength of the Nutrisystem brand and our award-winning customer experience, have us well-positioned to capture a larger share of the broader weight loss space and enhance long-term shareholder value.”

The following are key financial highlights for the period. Reconciliations of certain GAAP to non-GAAP measures are provided later in this press release.

Second Quarter 2016 Compared to Second Quarter 2015

• Revenue increased 15% to $149.8 million, compared to $130.3 million.
• Gross margin increased 190 basis points to 53.9%, compared to 52.0%.
• Net income increased 33% to $16.1 million, compared to $12.1 million.
• Diluted income per common share increased 32% to $0.54, compared to $0.41.
• Adjusted EBITDA increased 33% to $29.9 million, compared to $22.5 million.
• The Board of Directors has declared a quarterly dividend of $0.175 per share, payable August 18, 2016 to stockholders of record as of August 8, 2016.

Mike Monahan, Chief Financial Officer, commented, “Our second quarter results demonstrate our consistent ability to grow the business while we continue to invest in new longer-term product offerings and portfolio expansion opportunities. As a result of this performance, we are raising the bottom end of our guidance ranges for the full year.”

Third Quarter and Updated Full Year 2016 Guidance

The Company’s third quarter and updated full year 2016 guidance are outlined below. Reconciliations of certain GAAP to non-GAAP measures are provided later in this press release along with tables detailing the expected impact of the South Beach and Shake360 initiatives.

• Third quarter revenue is expected to be in the range of $113 to $118 million, net income between $7.0 and $8.3 million, diluted income per common share between $0.23 and $0.28, and adjusted EBITDA between $15.6 and $17.6 million. This guidance includes $1.8 million of cash operating expense and $0.3 million of amortization expense, or $0.05 per common share expense, for the South Beach Diet and Shake360 initiatives.
• Full year 2016 revenue is now expected to be in the range of $520 to $532 million compared to previous range of $517 to $532 million, net income between $31.1 and $33.6 million, diluted income per common share between $1.05 and $1.13 compared to previous range of $1.03 to $1.13, and adjusted EBITDA between $66.8 and $70.5 million compared to previous range of $66.0 to $70.5 million. This updated guidance includes $5.5 million of cash operating expense and $1.0 million of amortization expense, or $0.14 per common share expense, for the South Beach Diet and Shake360 initiatives. Nutrisystem’s adjusted diluted income per common share is expected to be $1.19 to $1.27 compared to previous range of $1.17 to $1.27, which excludes the expected impact of the South Beach Diet and Shake360 initiatives.

About Nutrisystem, Inc.

Nutrisystem, Inc. (NASDAQ: NTRI) is a leader in the weight loss industry, having helped millions of people lose weight over the course of more than 40 years. The Company’s weight loss solutions include Nutrisystem® My Way®, Fast 5, and Turbo 10, all clinically tested, structured food delivery programs that come with the digital platform NuMi® by Nutrisystem. Additionally, the Company offers multi-day kits and individual products available at select retail outlets. The Company’s current product line offers customers the most meal choices, including more than 150 foods with no artificial colors, flavors or sweeteners. Nutrisystem provides customers the flexibility to align their diet with the US Healthy Eating Meal Pattern, as recommended by the USDA Dietary Guidelines. Plans include comprehensive counseling options from trained weight loss coaches, registered dietitians and certified diabetes educators and can be customized to specific dietary needs and preferences including the Nutrisystem® D® program for people with Type 2 diabetes or pre-diabetes. The Company also owns and operates the South Beach Diet® and Shake360™ brands. For more information, go to NutrisystemNews.com.