About GNC Holdings, Inc.
Vitamins and supplements are part of the daily regimen at GNC Holdings. GNC Holdings is one of the world's leading nutritional-supplements retail chain devoted to items such as vitamins, supplements, minerals, and dietary products. The firm manufactures private-label products for Rite Aid, Sam's Club, and PetSmart. Altogether, GNC boasts more than 7,500 stores, including some 2,900 company-owned stores in the US, Canada, and Puerto Rico; some 1,000 franchised stores in the US; about 1,900 franchised stores internationally in about 50 countries; and more than 1,700 store-within-a-store sites in Rite Aid locations. The vast majority of its sales comes from US.
GNC operates through three segments: the US and Canada segment, International segment, and Manufacturing/Wholesale segment.
GNC's US and Canada segment generates revenues primarily from the sale of products to customers at company-owned stores in the United States, Canada and Puerto Rico, through product sales to domestic franchisees, royalties on domestic franchise retail sales, franchise fees, and through GNC.com and its market place on Amazon. The segment accounts for more than 85% of company's total revenue.
The International segment generates revenue primarily from its international franchisees through product sales, royalties and franchise fees, and its China and Ireland operations. The segment accounts for nearly 5% of total revenue.
The Manufacturing/Wholesale segment (about 10% of total revenue) includes manufacturing operations in South Carolina and its wholesale partner relationships. Its manufacturing operations supply its US and Canada and International segments with proprietary product and also manufactures products for other third parties.
Headquartered in Pittsburgh, Pennsylvania, GNC has offices in Boston, Massachusetts; Tustin, California; Mississauga, Ontario; Dublin, Ireland; and Greenville, South Carolina. Its distribution centers are located in South Carolina, Indiana, Pennsylvania, and Arizona. Its Nutra Manufacturing is located in Greenville, South Carolina. California, Florida, New York, Pennsylvania, and Texas account for about a third of GNC's company-owned stores.
GNC rings up to some 95% of its sales in the US. GNC also does business in about 50 other countries. Mexico, South Africa, South Korea, and Chile are home to more than 55% of GNC's approximately 1,904 international franchise stores. GNC has some 175 company-owned stores in Canada.
Sales and Marketing
GNC's products are delivered to retail stores, wholesale distributors, international franchisees, and directly to customers who purchase through online, via a third party transportation network, primarily through company's distribution centers. GNC's wholesale partners include Rite Aid, PetSmart and Sam's Club.
The Company recognized advertising expense of $86.0 million, $95.6 million and $104.5 million for the years ended December 31, 2019, 2018 and 2017, respectively.
GNC Holdings has struggled to attain meaningful revenue growth in recent years.
Revenue dropped to $2.1 billion in 2019, an approximately 12% decrease from the year prior. The decrease in revenue was largely due to the transfer of the Nutra manufacturing and China business to the joint ventures formed in the first quarter of 2019, the closure of company-owned stores under its store portfolio optimization strategy, a decrease in U.S. company-owned and Canada same store sales, and lower sales to its wholesale partners primarily due to the termination of the consignment agreement with Rite Aid in the fourth quarter of 2018.
GNC reported a net loss was $35.1 million in the current year compared with net income of $69.8 million in the prior year.
Cash at the end of 2019 was $117.1 million. Cash provided by operating activities was $96.5 million in 2019, while investing activities provided $73.4 million. Financing activities used $119.3 million.
Facing stiff competition in the industry, GNC Holdings is looking toward new opportunities for growth while continuing to focus on cost savings.
GNC is investing in its omnichannel capabilities to keep pace with changing customer expectations and new developments by competitors. Its omnichannel initiatives include offering online and in-store subscription services, offering customers the option of picking up online purchases in store, and shipping products purchased via e-commerce directly from stores.
GNC struck up several deals and partnerships, including a $300 million investment by Harbin to become the company's largest stockholder. The Harbin deal also includes a joint venture with Harbin in China. Its IVC (International Vitamin Company) deal will allow IVC to own GNC's manufacturing arm by 2023 through a joint venture. The strategic partnership with IVC will create meaningful efficiencies in manufacturing and further strengthen the innovation and product development capabilities that set us apart.
GNC Holdings was founded as a health food store in Pittsburgh in 1935.
300 6th Ave FL 2
Pittsburgh, PA 15222-2528
Phone: 1 (412) 288-4600
Employer Type: Publicly Owned
EVP Operations: Joseph C. Gorman
CEO: Kenneth A. Martindale
Chairman: Robert F. Moran
Employees (This Location): 33
Employees (All Locations): 12,400
Machesney Park, IL
Apple Valley, MN
Forest Lake, MN
Maryland Heights, MO