Former Vitamin Shoppe President and COO Michael G. Archbold has been named CEO of GNC, effective immediately, replacing Joseph Fortunato – who had served as Chairman, President and CEO. Fortunato has also stepped down from the GNC board of directors.
Lead Independent Director Michael Hines has been elected Non-Executive Chairman of the GNC board.
“Joe Fortunato led GNC through a period of considerable growth, innovation and transformation,” Hines said in a statement. “We thank him for his significant contributions to the Company and we wish him well in the future.”
The move comes less than a week after GNC reported its second-quarter results, and updated its guidance for 2014. Same store sales as measured on a product-only basis decreased 4% in domestic company-owned stores, including GNC.com sales, as compared to a 6.8% increase in the second quarter of 2013. GNC reported net income of $69.9 million, compared to $71.7 million for the second quarter of 2013.
Archbold has over 25 years of retail industry experience, and most recently served as CEO and CFO of The Talbots Inc., where he successfully implemented a comprehensive strategy to enhance the customer experience resulting in significant improvement in the woman’s apparel retailer’s financial results.
Archbold has also served as CFO at Saks Fifth Avenue and AutoZone Inc.
“GNC is an admired industry leader with an iconic brand, strong positions in its core markets, differentiated products, a history of innovation and a loyal customer base,” Archbold said in a press release. “I am honored to lead this organization, and I look forward to working closely with the team across GNC and the Board to further strengthen the Company’s market position and deliver improved financial performance.”
For first six months of 2014, GNC reported consolidated revenue of $1,352.5 million, an increase of 0.9% over consolidated revenue of $1,341.0 million for the first six months of 2013. Revenue increased in GNC’s retail segment by 1.9%. Revenue decreased in the Company’s franchise and manufacturing segments, by 0.9% and 4.0% respectively. GNC also reported net income of $139.8 million, compared to $144.3 million for the first six months of 2013. Diluted earnings per share were $1.52 for first six months of 2014, a 4.1% increase over 2013 results.