Document and Entity Information
Document and Entity Information - USD ($) | 12 Months Ended | ||
Jan. 02, 2016 | Feb. 01, 2016 | Jul. 02, 2015 | |
Document Type | 10-K | ||
Amendment Flag | false | ||
Document Period End Date | Jan. 2, 2016 | ||
Document Fiscal Year Focus | 2,015 | ||
Document Fiscal Period Focus | FY | ||
Trading Symbol | WTW | ||
Entity Registrant Name | WEIGHT WATCHERS INTERNATIONAL INC | ||
Entity Central Index Key | 105,319 | ||
Current Fiscal Year End Date | --01-02 | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Current Reporting Status | Yes | ||
Entity Voluntary Filers | No | ||
Entity Filer Category | Accelerated Filer | ||
Entity Common Stock, Shares Outstanding | 63,648,349 | ||
Entity Public Float | $ 112,751,513 |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Jan. 02, 2016 | Jan. 03, 2015 | |
CURRENT ASSETS | |||
Cash and cash equivalents | $ 241,526 | $ 301,212 | |
Receivables (net of allowances: January 2, 2016-$2,226 and January 3, 2015-$3,287) | 29,281 | 31,960 | |
Inventories | 27,838 | 32,382 | |
Deferred income taxes | 7,516 | 23,744 | |
Prepaid expenses and other current assets | 52,812 | 36,367 | |
TOTAL CURRENT ASSETS | 358,973 | 425,665 | |
Property and equipment, net | 58,186 | 74,650 | |
Franchise rights acquired | 747,326 | 760,883 | |
Goodwill | 159,331 | 168,279 | |
Trademarks and other intangible assets, net | 66,339 | 68,115 | |
Deferred financing costs, net | 25,209 | 32,742 | |
Other noncurrent assets | 6,720 | 4,306 | |
TOTAL ASSETS | 1,422,084 | 1,534,640 | |
CURRENT LIABILITIES | |||
Portion of long-term debt due within one year | 213,323 | 80,728 | |
Accounts payable | 38,225 | 52,411 | |
Salaries and wages payable | 47,042 | 64,785 | |
Accrued marketing and advertising | 21,554 | 20,540 | |
Accrued interest | 20,739 | 22,965 | |
Other accrued liabilities | 56,477 | 81,653 | |
Derivative payable | 44,170 | 42,423 | |
Deferred revenue | 61,597 | 66,190 | |
TOTAL CURRENT LIABILITIES | 503,127 | 431,695 | |
Long-term debt | 2,021,250 | 2,277,272 | |
Deferred income taxes | 159,539 | 176,278 | |
Other | 23,876 | 16,883 | |
TOTAL LIABILITIES | $ 2,707,792 | $ 2,902,128 | |
Commitments and contingencies (Note 14) | |||
Redeemable noncontrolling interest | $ 4,450 | $ 5,553 | |
TOTAL DEFICIT | |||
Common stock, $0 par value; 1,000,000 shares authorized; 118,855 shares issued at January 2, 2016 and 112,195 shares issued at January 3, 2015 | 0 | 0 | |
Treasury stock, at cost, 55,301 shares at January 2, 2016 and 55,485 shares at January 3, 2015 | (3,247,406) | (3,253,597) | |
Retained earnings | 1,994,513 | 1,900,506 | |
Accumulated other comprehensive loss | [1] | (37,265) | (19,950) |
TOTAL DEFICIT | (1,290,158) | (1,373,041) | |
TOTAL LIABILITIES AND TOTAL DEFICIT | 1,422,084 | 1,534,640 | |
Franchise Rights | |||
CURRENT ASSETS | |||
Franchise rights acquired | $ 747,326 | $ 760,883 | |
[1] | Amounts in parentheses indicate debits |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands | Jan. 02, 2016 | Jan. 03, 2015 |
Receivables, allowances | $ 2,226 | $ 3,287 |
Common stock, par value | $ 0 | $ 0 |
Common stock, shares authorized | 1,000,000,000 | 1,000,000,000 |
Common stock, shares issued | 118,855,000 | 112,195,000 |
Treasury stock, shares | 55,301,000 | 55,485,000 |
CONSOLIDATED STATEMENTS OF INCO
CONSOLIDATED STATEMENTS OF INCOME - USD ($) shares in Thousands, $ in Thousands | 12 Months Ended | ||
Jan. 02, 2016 | Jan. 03, 2015 | Dec. 28, 2013 | |
Service revenues, net | $ 937,368 | $ 1,181,945 | $ 1,360,761 |
Product sales and other, net | 227,051 | 297,971 | 363,362 |
Revenues, net | 1,164,419 | 1,479,916 | 1,724,123 |
Cost of services | 477,926 | 535,320 | 558,451 |
Cost of product sales and other | 112,406 | 142,045 | 164,560 |
Cost of revenues | 590,332 | 677,365 | 723,011 |
Gross profit | 574,087 | 802,551 | 1,001,112 |
Marketing expenses | 201,021 | 262,258 | 295,628 |
Selling, general and administrative expenses | 205,008 | 240,979 | 247,732 |
Operating income | 168,058 | 299,314 | 457,752 |
Interest expense | 121,843 | 122,984 | 103,108 |
Other expense, net | 2,027 | 3,206 | 599 |
Gain on Brazil acquisition | 0 | (10,540) | 0 |
(Gain) loss on early extinguishment of debt | (11,426) | 0 | 21,685 |
Income before income taxes | 55,614 | 183,664 | 332,360 |
Provision for income taxes | 22,835 | 65,931 | 129,618 |
Net income | 32,779 | 117,733 | 202,742 |
Net loss attributable to the noncontrolling interest | 166 | 54 | 0 |
Net income attributable to Weight Watchers International, Inc. | $ 32,945 | $ 117,787 | $ 202,742 |
Earnings Per Share attributable to Weight Watchers International, Inc. | |||
Basic | $ 0.56 | $ 2.08 | $ 3.61 |
Diluted | $ 0.56 | $ 2.08 | $ 3.60 |
Weighted average common shares outstanding | |||
Basic | 58,369 | 56,607 | 56,144 |
Diluted | 58,966 | 56,705 | 56,394 |
Dividends declared per common share | $ 0 | $ 0 | $ 0.53 |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Thousands | 12 Months Ended | |||
Jan. 02, 2016 | Jan. 03, 2015 | Dec. 28, 2013 | ||
Net income | $ 32,779 | $ 117,733 | $ 202,742 | |
Other comprehensive loss: | ||||
Foreign currency translation adjustments | (27,824) | (19,167) | (10,363) | |
Income tax effect on foreign currency translation losses | 10,851 | 7,475 | 4,022 | |
Foreign currency translation adjustments, net of taxes | (16,973) | (11,692) | (6,341) | |
Changes in (loss) gain on derivatives | (2,096) | (28,283) | 3,277 | |
Income tax benefit (expense) on gain (loss) on derivatives | 817 | 11,030 | (1,278) | |
Changes in (loss) gain on derivatives, net of taxes | (1,279) | (17,253) | 1,999 | |
Total other comprehensive loss | [1] | (18,252) | (28,945) | (4,342) |
Comprehensive income | 14,527 | 88,788 | 198,400 | |
Less: Net loss attributable to the noncontrolling interest | 166 | 54 | 0 | |
Less: Foreign currency translation losses, net of taxes attributable to the noncontrolling interest | 937 | 478 | 0 | |
Comprehensive loss attributable to the noncontrolling interest | 1,103 | 532 | 0 | |
Comprehensive income attributable to Weight Watchers International, Inc. | $ 15,630 | $ 89,320 | $ 198,400 | |
[1] | Amounts in parentheses indicate debits |
CONSOLIDATED STATEMENTS OF CHAN
CONSOLIDATED STATEMENTS OF CHANGES IN TOTAL DEFICIT - USD ($) shares in Thousands, $ in Thousands | Total | Knowplicity, Inc. | Weilos | Redeemable Noncontrolling Interest | Common Stock | Common StockKnowplicity, Inc. | Common StockWeilos | Treasury Stock | Accumulated Other Comprehensive Income (Loss) | Retained Earnings | Retained EarningsKnowplicity, Inc. | Retained EarningsWeilos |
Beginning balance at Dec. 29, 2012 | $ (1,665,459) | $ 0 | $ 0 | $ (3,281,831) | $ 12,859 | $ 1,603,513 | ||||||
Beginning balance (in shares) at Dec. 29, 2012 | 111,988 | 56,234 | ||||||||||
Comprehensive (Loss) Income | 198,400 | 0 | (4,342) | 202,742 | ||||||||
Issuance of treasury stock under stock plans (in shares) | (672) | |||||||||||
Issuance of treasury stock under stock plans | 15,121 | $ 25,425 | (10,304) | |||||||||
Tax benefit of restricted stock units vested and stock options exercised | 537 | 537 | ||||||||||
Cash dividends | (29,459) | (29,459) | ||||||||||
Compensation expense on share-based awards | 4,255 | 4,255 | ||||||||||
Ending balance at Dec. 28, 2013 | (1,476,605) | 0 | $ 0 | $ (3,256,406) | 8,517 | 1,771,284 | ||||||
Ending balance (in shares) at Dec. 28, 2013 | 111,988 | 55,562 | ||||||||||
Comprehensive (Loss) Income | 89,320 | (532) | (28,467) | 117,787 | ||||||||
Issuance of treasury stock under stock plans (in shares) | (77) | |||||||||||
Issuance of treasury stock under stock plans | 250 | $ 2,809 | (2,559) | |||||||||
Tax benefit of restricted stock units vested and stock options exercised | (788) | (788) | ||||||||||
Cash dividends | 42 | 42 | ||||||||||
Compensation expense on share-based awards | 10,533 | 10,533 | ||||||||||
Acquisition of Additional Equity Interest in Brazil | 6,157 | |||||||||||
Stock issued business acquisition value | $ 4,207 | $ 4,207 | ||||||||||
Stock issued business acquisition value (in shares) | 207 | |||||||||||
Distribution to noncontrolling interest | (75) | |||||||||||
Other | 3 | |||||||||||
Ending balance at Jan. 03, 2015 | (1,373,041) | 5,553 | $ 0 | $ (3,253,597) | (19,950) | 1,900,506 | ||||||
Ending balance (in shares) at Jan. 03, 2015 | 112,195 | 55,485 | ||||||||||
Comprehensive (Loss) Income | 15,630 | (1,103) | (17,315) | 32,945 | ||||||||
Issuance of treasury stock under stock plans (in shares) | (184) | |||||||||||
Issuance of treasury stock under stock plans | (988) | $ 6,191 | (7,179) | |||||||||
Tax benefit of restricted stock units vested and stock options exercised | (932) | (932) | ||||||||||
Cash dividends | 3 | 3 | ||||||||||
Compensation expense on share-based awards | 24,771 | 24,771 | ||||||||||
Sale of common stock | 41,475 | 41,475 | ||||||||||
Sale of common stock (in shares) | 6,362 | |||||||||||
Stock issued business acquisition value | $ 2,924 | $ 2,924 | ||||||||||
Stock issued business acquisition value (in shares) | 298 | |||||||||||
Ending balance at Jan. 02, 2016 | $ (1,290,158) | $ 4,450 | $ 0 | $ (3,247,406) | $ (37,265) | $ 1,994,513 | ||||||
Ending balance (in shares) at Jan. 02, 2016 | 118,855 | 55,301 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 12 Months Ended | ||
Jan. 02, 2016 | Jan. 03, 2015 | Dec. 28, 2013 | |
Operating activities: | |||
Net income | $ 32,779 | $ 117,733 | $ 202,742 |
Adjustments to reconcile net income to cash provided by operating activities: | |||
Depreciation and amortization | 53,171 | 49,234 | 47,909 |
Amortization of deferred financing costs | 6,886 | 9,305 | 7,672 |
Impairment of intangible and long-lived assets | 2,455 | 652 | 5,426 |
Share-based compensation expense | 24,771 | 10,533 | 4,255 |
Deferred tax provision | 12,098 | 29,099 | 34,358 |
Allowance for doubtful accounts | (446) | 99 | 596 |
Reserve for inventory obsolescence | 7,593 | 11,822 | 9,580 |
Foreign currency exchange rate loss | 1,526 | 2,984 | 659 |
Gain on Brazil acquisition | 0 | (10,540) | 0 |
Loss on disposal of assets | 0 | 171 | 1,417 |
(Gain) loss on early extinguishment of debt | (12,667) | 0 | 21,685 |
Other items, net | 0 | (184) | 0 |
Changes in cash due to: | |||
Receivables | 1,571 | 3,777 | 345 |
Inventories | (3,055) | (3,218) | (2,226) |
Prepaid expenses | (18,284) | 1,341 | 1,037 |
Accounts payable | (13,930) | 7,807 | (3,607) |
Accrued liabilities | (30,906) | 10,361 | 4,988 |
Deferred revenue | 1,256 | (7,915) | (10,521) |
Income taxes | (10,003) | (1,442) | 4,473 |
Cash provided by operating activities | 54,815 | 231,619 | 323,516 |
Investing activities: | |||
Capital expenditures | (3,952) | (9,097) | (40,657) |
Capitalized software expenditures | (32,307) | (42,589) | (21,277) |
Cash paid for acquisitions | (3,112) | (16,678) | (83,825) |
Other items, net | (936) | (628) | 411 |
Cash used for investing activities | (40,307) | (68,992) | (145,348) |
Financing activities: | |||
Proceeds from new term loans | 0 | 0 | 2,400,000 |
Borrowings on revolver | 48,000 | 0 | 70,000 |
Payments on long-term debt | (158,113) | (30,000) | (2,488,364) |
Payment of dividends | (42) | (80) | (29,571) |
Proceeds from the sale of common stock, net of fees | 41,475 | 0 | 0 |
Deferred financing costs | 0 | 0 | (44,817) |
Proceeds from stock options exercised | 95 | 658 | 16,187 |
Tax benefit of restricted stock units vested and stock options exercised | 0 | 1 | 2,132 |
Cash used for financing activities | (68,585) | (29,421) | (74,433) |
Effect of exchange rate changes on cash and cash equivalents and other | (5,609) | (6,551) | 607 |
Net (decrease) increase in cash and cash equivalents | (59,686) | 126,655 | 104,342 |
Cash and cash equivalents, beginning of fiscal year | 301,212 | 174,557 | 70,215 |
Cash and cash equivalents, end of fiscal year | 241,526 | 301,212 | 174,557 |
United Kingdom | |||
Changes in cash due to: | |||
UK self-employment liability | $ 0 | $ 0 | $ (7,272) |
Basis of Presentation
Basis of Presentation | 12 Months Ended |
Jan. 02, 2016 | |
Basis of Presentation | 1. Basis of Presentation The accompanying consolidated financial statements include the accounts of Weight Watchers International, Inc. and all of its subsidiaries. The terms “Company” and “WWI” as used throughout these notes is used to indicate Weight Watchers International, Inc. and all of its operations consolidated for purposes of its financial statements. The Company’s “meetings” business refers to providing access to meetings to the Company’s monthly commitment plan subscribers, “pay-as-you-go” members, Total Access subscribers and other meeting members. “Online” refers to Weight Watchers Online, Weight Watchers Online Plus The consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (“GAAP”) and include all of the Company’s majority-owned subsidiaries. As further discussed in Note 4, (1) as a result of the acquisition of an additional equity interest in Vigilantes do Peso Marketing Ltda. (“VPM”) in March 2014, the Company gained a direct controlling financial interest in VPM and began to consolidate this entity as of the date of acquisition; (2) as a result of the acquisition of Knowplicity, Inc., d/b/a Wello, in April 2014, Wello became a wholly owned subsidiary of the Company and the Company began to consolidate the entity as of the date of acquisition and (3) as a result of the acquisition of Weilos, Inc. (“Weilos”), in March 2015, Weilos became a wholly owned subsidiary of the Company and the Company began to consolidate the entity as of the date of acquisition. All intercompany accounts and transactions have been eliminated in consolidation. Out-of-Period Adjustments: In fiscal 2015, the Company identified and recorded out-of-period adjustments related to immaterial errors in prior period financial statements that increased income before income taxes by $1,650, provision for income taxes by $1,970, and decreased net income attributable to the Company by $320. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 12 Months Ended |
Jan. 02, 2016 | |
Summary of Significant Accounting Policies | 2. Summary of Significant Accounting Policies Fiscal Year: The Company’s fiscal year ends on the Saturday closest to December 31 st and consists of either 52 or 53-week Use of Estimates: The preparation of financial statements, in conformity with GAAP, requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting period. On an ongoing basis, the Company evaluates its estimates and judgments, including those related to inventories, the impairment analysis for goodwill and other indefinite-lived intangible assets, share-based compensation, income taxes, tax contingencies and litigation. The Company bases its estimates on historical experience and on various other factors and assumptions that it believes to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual amounts could differ from these estimates. Translation of Foreign Currencies: For all foreign operations, the functional currency is the local currency. Assets and liabilities of these operations are translated into US dollars using the exchange rate in effect at the end of each reporting period. Income statement accounts are translated at the average rate of exchange prevailing during each reporting period. Translation adjustments arising from the use of differing exchange rates from period to period are included in accumulated other comprehensive income (loss). Foreign currency gains and losses arising from the translation of intercompany receivables and intercompany payables with the Company’s international subsidiaries are recorded as a component of other expense (income), net, unless the receivable is considered long-term in nature, in which case the foreign currency gains and losses are recorded as a component of accumulated other comprehensive income (loss). Cash Equivalents: Cash and cash equivalents are defined as highly liquid investments with original maturities of three months or less. Cash balances may, at times, exceed insurable amounts. The Company believes it mitigates this risk by investing in or through major financial institutions. Cash includes balances due from third-party credit card companies. Inventories: Inventories, which consist of finished goods, are stated at the lower of cost or market on a first-in, first-out basis, net of reserves for obsolescence and shrinkage. Property and Equipment: Property and equipment are recorded at cost. For financial reporting purposes, equipment is depreciated on the straight-line method over the estimated useful lives of the assets (3 to 10 years). Leasehold improvements are amortized on the straight-line method over the shorter of the term of the lease or the useful life of the related assets. Expenditures for new facilities and improvements that substantially extend the useful life of an asset are capitalized. Ordinary repairs and maintenance are expensed as incurred. When assets are retired or otherwise disposed of, the cost and related depreciation are removed from the accounts and any related gains or losses are included in income. Impairment of Long Lived Assets: The Company reviews long-lived assets, including amortizable intangible assets, for impairment whenever events or changes in business circumstances indicate that the carrying amount of the assets may not be fully recoverable. In fiscal 2015, the Company recorded an impairment charge of $2,028 related to internal-use computer software that was not expected to provide substantive service potential. In fiscal 2015 and fiscal 2014, the Company recorded impairment charges of $427 and $652, respectively, related to property, plant and equipment that were expected to be disposed of before the end of their estimated useful lives. In fiscal 2013, the Company commenced the shutdown of its China operations and, as a result, recorded an impairment charge of $1,607 related to property, plant and equipment ($372) and amortizable intangible assets ($1,235). The Company also recorded an impairment charge of $2,653 in fiscal 2013 related to internal-use computer software that was not expected to provide substantive service potential. Goodwill and Franchise Rights Acquired and Other Intangible Assets: Finite-lived intangible assets are amortized using the straight-line method over their estimated useful lives of 3 to 20 years or, in the case of amortizable franchise rights acquired, over the remaining contractual period, which is generally less than one year. The Company reviews goodwill and other indefinite-lived intangible assets, including franchise rights acquired with indefinite lives, for potential impairment on at least an annual basis or more often if events so require. The Company performed fair value impairment testing as of the end of fiscal 2015 and fiscal 2014 on its goodwill and other indefinite-lived intangible assets. In performing the impairment analysis for the fiscal year ended January 2, 2016 and for the fiscal year ended January 3, 2015, the Company determined that the carrying amounts of its franchise rights acquired with indefinite lives did not exceed their respective fair values and therefore, no impairment existed. In performing the impairment analysis for the fiscal year ended December 28, 2013, the Company determined that, based on the fair values calculated, the carrying amounts of the indefinite-lived franchise rights acquired related to its Mexico and Hong Kong operations exceeded their respective fair values and recorded impairment charges of $935 and $231, respectively. The Company determined that the carrying amounts of the remainder of its franchise rights acquired with indefinite lives did not exceed their respective fair values as of the end of fiscal 2013, and therefore, no other impairment existed. When determining fair value, the Company utilizes various assumptions, including projections of future cash flows, growth rates and discount rates. A change in these underlying assumptions will cause a change in the results of the tests and, as such, could cause fair value to be less than the carrying amounts and result in an impairment of those assets. In the event such a result occurred, the Company would be required to record a corresponding charge, which would impact earnings. The Company would also be required to reduce the carrying amounts of the related assets on its balance sheet. The Company continues to evaluate these estimates and assumptions and believes that these assumptions are appropriate. The following is a discussion of the goodwill and franchise rights acquired impairment analysis. Goodwill In performing the impairment analysis for goodwill, the fair value for the Company’s reporting units is estimated using a discounted cash flow approach. This approach involves projecting future cash flows attributable to the reporting unit and discounting those estimated cash flows using an appropriate discount rate. The estimated fair value is then compared to the carrying value of the reporting unit. The Company has determined the appropriate reporting unit for purposes of assessing annual impairment to be the country for all reporting units. To date, the Company has not recorded an impairment of goodwill. For all of the Company’s reporting units except for Brazil (see below), the Company estimated future cash flows by utilizing the historical debt-free cash flows attributable to that country and then applied expected future operating income growth rates for such country. The Company utilized operating income as the basis for measuring its potential growth because it believes it is the best indicator of the performance of its business. The Company then discounted the estimated future cash flows utilizing a discount rate which was calculated using the average cost of capital, which included the cost of equity and the cost of debt. The cost of equity was determined by combining a risk-free rate of return and a market risk premium for the Company’s peer group. The risk-free rate of return was generally determined based on the average rate of long-term U.S. Treasury securities. The market risk premium was generally determined by reviewing external market data. The cost of debt was determined by estimating the Company’s current borrowing rate. As it relates to the impairment analysis for Brazil, the Company estimated future debt-free cash flows in contemplation of its growth strategies for that market. In developing these projections, the Company considered the historical impact of similar growth strategies in other markets as well as the current market conditions in Brazil. The Company then discounted the estimated future cash flows utilizing a discount rate which was calculated using the average cost of capital, which included the cost of equity and the cost of debt. The cost of equity was determined by combining a risk-free rate of return and a market risk premium for the Company’s peer group. The risk-free rate of return was generally determined based on the average rate of long-term U.S. Treasury securities. The market risk premium was generally determined by reviewing external market data. Additional consideration was given to the current economic conditions in Brazil and country specific risk as well as the rate of growth projected in the analysis. The cost of debt was determined by estimating the Company’s current borrowing rate. Franchise Rights Acquired In performing the impairment analysis for indefinite-lived franchise rights acquired, the fair value for franchise rights acquired is estimated using a discounted cash flow approach referred to as the hypothetical start-up approach for franchise rights related to the Company’s meetings business and a relief from royalty methodology for franchise rights related to the Company’s Online business. The aggregate estimated fair value for these rights is then compared to the carrying value of the unit of accounting for those franchise rights. The Company has determined the appropriate unit of account for purposes of assessing annual impairment to be the combination of the rights in the meetings and Online businesses in the country in which the acquisitions have occurred. The values of these franchise rights in the United States, Canada, United Kingdom, Australia, New Zealand and other countries at January 2, 2016 were $675,515, $48,435, $11,858, $6,563, $4,833, and $122, respectively, totaling $747,326 and the values at January 3, 2015 were $675,515, $57,579, $13,138, $7,272, $5,449 and $1,930, respectively, totaling $760,883. The Company estimated future cash flows for each unit of accounting by utilizing a hypothetical start-up approach in which it assumed that the year of maturity was reached after 7 years. Subsequent to the year of maturity, the Company assumed debt-free cash flow growth rates based on its expected future operating income growth rates for such country. The Company utilized operating income as the basis for measuring its potential growth because it believes it is the best indicator of the performance of its business. The Company then discounted the estimated future cash flows utilizing discount rates consistent with those used in its goodwill impairment analysis as discussed above. Other Intangible Assets The Company expenses all software costs (including website development costs) incurred during the preliminary project stage and capitalizes all internal and external direct costs of materials and services consumed in developing software (including website development costs) once the development has reached the application development stage. Application development stage costs generally include software configuration, coding, installation to hardware and testing. These costs are amortized over their estimated useful life of 3 years for website development costs and from 3 to 5 years for all other software costs. All costs incurred for upgrades, maintenance and enhancements, including the cost of website content, which do not result in additional functionality, are expensed as incurred. Revenue Recognition: WWI earns revenue by conducting meetings, for which it charges a fee, predominantly through monthly commitment plans, prepayment plans or the “pay-as-you-go” arrangement. WWI also earns revenue from monthly subscriptions for its Online products, selling products in its meetings, on the Internet and to its franchisees, collecting commissions from franchisees, collecting royalties related to licensing agreements, selling magazine subscriptions, selling advertising space on its website and in copies of its magazines, ecommerce fees and By Mail product sales. Monthly commitment plans, prepaid meeting fees and magazine subscription revenue is recorded to deferred revenue and amortized into revenue over the period earned. Online Subscription Revenues, consisting of the fees associated with subscriptions for the Company’s Online subscription products, including its Personal Coaching product, are recognized over the period that products are provided. One-time sign-up fees are deferred and recognized over the expected customer relationship period. Online Subscription Revenues that are paid in advance are deferred and recognized on a straight-line basis over the subscription period. Revenue from “pay-as-you-go” meeting fees, product sales, ecommerce fees, By Mail, commissions and royalties is recognized when services are rendered, products are shipped to customers and title and risk of loss pass to the customers, and commissions and royalties are earned, respectively. Revenue from advertising in magazines is recognized when advertisements are published. Revenue from magazine sales is recognized when the magazine is sent to the customer. In the meetings business, WWI generally charges non-refundable registration and starter fees in exchange for an introductory information session and materials it provides to new members. Revenue from these registration and starter fees is recognized when the service and products are provided, which is generally at the same time payment is received from the customer. Discounts to customers, including free registration offers, are recorded as a deduction from gross revenue in the period such revenue was recognized. Revenue from advertising on its website is recognized when the advertisement is viewed by the user. The Company grants refunds in aggregate amounts that historically have not been material. Because the period of payment of the refund generally approximates the period revenue was originally recognized, refunds are recorded as a reduction of revenue when paid. Advertising Costs: Advertising costs consist primarily of television and digital media. All costs related to advertising are expensed in the period incurred, except for media production-related costs, which are expensed the first time the advertising takes place. Total advertising expenses for the fiscal years ended January 2, 2016, January 3, 2015 and December 28, 2013 were $191,060, $251,954, and $285,298, respectively. Income Taxes: Deferred income tax assets and liabilities result primarily from temporary differences between the financial statement and tax bases of assets and liabilities, using enacted tax rates in effect for the year in which differences are expected to reverse. If it is more-likely-than-not that some portion of a deferred tax asset will not be realized, a valuation allowance is recognized. The Company considers historic levels of income, estimates of future taxable income and feasible tax planning strategies in assessing the need for a tax valuation allowance. The Company recognizes a benefit for uncertain tax positions when a tax position taken or expected to be taken in a tax return is more-likely-than-not to be sustained upon examination by taxing authorities. The amount recognized is measured as the largest amount of benefit that is greater than 50% likely of being realized upon ultimate settlement. The Company recognizes accrued interest and penalties associated with uncertain tax positions as part of the provision for income taxes on its consolidated statements of income. In addition, assets and liabilities acquired in purchase business combinations are assigned their fair values and deferred taxes are provided for lower or higher tax bases. Derivative Instruments and Hedging: The Company is exposed to certain risks related to its ongoing business operations, primarily interest rate risk and foreign currency risk. The primary risk managed by using derivative instruments is interest rate risk. Interest rate swaps are entered into to hedge a portion of the cash flow exposure associated with the Company’s variable-rate borrowings. The Company does not use any derivative instruments for trading or speculative purposes. The Company recognizes the fair value of all derivative instruments as either assets or liabilities on the balance sheet. The Company has designated and accounted for interest rate swaps as cash flow hedges of its variable-rate borrowings. For derivative instruments that are designated and qualify as cash flow hedges, the effective portion of the gain or loss on the derivative is reported as a component of accumulated other comprehensive income (loss) and reclassified into earnings in the periods during which the hedged transactions affect earnings. Gains and losses on the derivative representing either hedge ineffectiveness or hedge components excluded from the assessment of effectiveness are recognized in current earnings. The fair value of the Company’s interest rate swaps is reported in derivative payable and prepaid expenses and other current assets on its balance sheet. See Note 16 for a further discussion regarding the fair value of the Company’s interest rate swaps. The net effect of the interest payable and receivable under the Company’s interest rate swaps is included in interest expense on the statement of income. Deferred Financing Costs: Deferred financing costs consist of fees paid by the Company as part of the establishment, exchange and/or modification of the Company’s long-term debt. During the fiscal year ended January 2, 2016, in connection with the prepayment of debt, the Company wrote-off deferred financing fees of approximately $647, recorded a gain on early extinguishment of debt totaling $11,426, and incurred additional fees of approximately $1,241. During the fiscal year ended January 3, 2015, the Company wrote-off deferred financing fees of approximately $1,583 in connection with amending its Credit Agreement (as defined in Note 7). During the fiscal year ended December 28, 2013, the Company incurred fees of $44,817 associated with the refinancing of the WWI Credit Facility (as defined in Note 7). The Company wrote-off fees in connection with this refinancing which resulted in the Company recording a charge of $21,685 in early extinguishment of debt. Amortization expense for the fiscal years ended January 2, 2016, January 3, 2015 and December 28, 2013 was $6,886, $9,305 and $7,672, respectively. Accumulated Other Comprehensive Loss: The Company’s accumulated other comprehensive loss includes net income, changes in the fair value of derivative instruments and the effects of foreign currency translations. At January 2, 2016, January 3, 2015 and December 28, 2013 the cumulative balance of changes in fair value of derivative instruments, net of taxes, was $(23,135), $(21,856) and $(4,603), respectively. At January 2, 2016, January 3, 2015 and December 28, 2013, the cumulative balance of the effects of foreign currency translations, net of taxes, was $(14,130) and $1,906 and $13,120, respectively. Restructuring Expense: The Company records estimated expense for restructuring initiatives when such costs are deemed probable and estimable, when approved by the appropriate corporate authority and by accumulating detailed estimates of costs for such plans. These expenses include the estimated costs of employee severance and related benefits, impairment or accelerated depreciation of property, plant and equipment and capitalized software, and any other qualifying exit costs. Such costs represent the Company’s best estimate, but require assumptions about the plans that may change over time, including attrition rates. Estimates are evaluated periodically to determine whether an adjustment is required. Reclassification: Certain prior year amounts have been reclassified to conform to the current year presentation. |
Winfrey Transaction
Winfrey Transaction | 12 Months Ended |
Jan. 02, 2016 | |
Winfrey Transaction | 3. Winfrey Transaction On October 18, 2015 (the “Agreement Date”), the Company entered into the following agreements with Oprah Winfrey: a Strategic Collaboration Agreement, the Winfrey Purchase Agreement (defined below), and the Winfrey Option Agreement (defined below). The transactions contemplated by these agreements are collectively referred to herein as the “Winfrey Transaction”. Details of the Strategic Collaboration Agreement, Winfrey Purchase Agreement and Winfrey Option Agreement are below. See Note 21 for related party transactions with Ms. Winfrey. Strategic Collaboration Agreement The Company and Ms. Winfrey granted each other certain intellectual property rights under the Strategic Collaboration Agreement. The agreement has an initial term of five years, with additional successive one-year renewal terms. During the term of this agreement, Ms. Winfrey will consult with the Company and participate in developing, planning, executing and enhancing the Weight Watchers program and related initiatives, and provide it with services in her discretion to promote the Company and its programs, products and services. Winfrey Purchase Agreement On October 19, 2015, pursuant to the Share Purchase Agreement between the Company and Ms. Winfrey (the “Winfrey Purchase Agreement”), the Company issued and sold to Ms. Winfrey an aggregate of 6,362 shares of the Company’s common stock (the “Purchased Shares”) at a price per share of $6.79 for an aggregate cash purchase price of $43,199. The Company recorded fees related to the issuance of the Purchased Shares totaling $2,315, of which $1,700 was recorded as a reduction of equity. The Purchased Shares are subject to certain demand registration rights and piggyback rights held by Ms. Winfrey under the Winfrey Purchase Agreement. The Purchased Shares may not be transferred by Ms. Winfrey within the first two years of the Agreement Date, subject to certain limited exceptions. Thereafter, Ms. Winfrey may generally transfer up to 15% of the Purchased Shares prior to the third anniversary of the Agreement Date, up to 30% prior to the fourth anniversary of the Agreement Date and up to 60% prior to the fifth anniversary of the Agreement Date. On or after the fifth anniversary of the Agreement Date, Ms. Winfrey will be permitted to transfer all of the Purchased Shares. In the event that Ms. Winfrey proposes to transfer any Purchased Shares or Winfrey Option Shares (defined below), the Company will have (a) a right of first offer with respect to such shares if such transfer is (i) for 1% or more of the Company’s issued and outstanding common stock that is proposed to be made pursuant to Rule 144 under the Securities Act of 1933, as amended or (ii) proposed to be sold under a resale shelf registration statement or (b) a right of first refusal with respect to such shares if such transfer is (i) for 1% or more of the Company’s issued and outstanding common stock and is proposed to be made to a competitor of the Company or (ii) for 5% or more of the Company’s issued and outstanding common stock. Such transfer restrictions, right of first offer and right of first refusal terminate if Ms. Winfrey then has the right to be nominated as a director and has met certain eligibility requirements under the Winfrey Purchase Agreement, but is not elected as a director of the Company. If Ms. Winfrey is elected as a director of the Company, she shall receive compensation for her services as a director consistent with that of other non-executive directors of the Company. Such transfer restrictions also terminate if there is a change of control, including if another person (or group), other than Artal Luxembourg S.A. and Ms. Winfrey and their respective affiliates, acquires more than 50% of the total voting power of the Company. Winfrey Option Agreement In consideration of Ms. Winfrey entering into the Strategic Collaboration Agreement and the performance of her obligations thereunder, on the Agreement Date, the Company granted Ms. Winfrey a fully vested option (the “Winfrey Option”) to purchase 3,513 shares of common stock at an exercise price of $6.97 per share. The term sheet, and related terms and conditions, for the Winfrey Option are referred to herein as the “Winfrey Option Agreement”. Based on the Black Scholes option pricing method, the Company recorded $12,759 of compensation expense in the fourth quarter of fiscal 2015 for the Winfrey Option. At the date of the grant, the Company used a dividend yield of 0.0%, 63.88% volatility and a risk-free interest rate of 1.36%. Compensation expense is included as a component of selling, general and administrative expenses. Subject to certain limited exceptions, shares of common stock issuable upon exercise of the Winfrey Option (the “Winfrey Option Shares”) generally may not be transferred by Ms. Winfrey within the first year of the Agreement Date. Thereafter, Ms. Winfrey generally may transfer up to 20% of the Winfrey Option Shares prior to the second anniversary of the Agreement Date, up to 40% prior to the third anniversary of the Agreement Date, up to 60% prior to the fourth anniversary of the Agreement Date and up to 80% prior to the fifth anniversary of the Agreement Date. On or after the fifth anniversary of the Agreement Date, Ms. Winfrey will be permitted to transfer all of the Winfrey Option Shares. Pursuant to the Winfrey Purchase Agreement, in the event that Ms. Winfrey proposes to transfer any Winfrey Option Shares, the Company will have a right of first offer or a right of first refusal with respect to such shares as described above. Such transfer restrictions terminate under the same director service and change of control circumstances that would result in the termination of the transfer restrictions relating to the Purchased Shares as described above. |
Acquisitions and Shutdown of Ch
Acquisitions and Shutdown of China Operations | 12 Months Ended |
Jan. 02, 2016 | |
Acquisitions and Shutdown of China Operations | 4. Acquisitions and Shutdown of China Operations Acquisitions of Franchisees The acquisitions of franchisees have been accounted for under the purchase method of accounting and, accordingly, earnings of acquired franchisees have been included in the consolidated operating results of the Company since the applicable date of acquisition. During fiscal 2013, the Company acquired certain assets of its franchisees as outlined below. On March 4, 2013, the Company acquired substantially all of the assets of its Alberta and Saskatchewan, Canada franchisees, Weight Watchers of Alberta Ltd. and Weight Watchers of Saskatchewan Ltd., for an aggregate purchase price of $35,000. The total purchase price has been allocated to franchise rights acquired ($1,135), goodwill ($34,124), customer relationship value ($473), inventory ($218), fixed assets ($182) and prepaid expenses ($3) offset by deferred revenue of $1,135. The franchise rights acquired were amortized over a ten month useful life. On July 15, 2013, the Company acquired substantially all of the assets of its West Virginia franchisee, Weight Watchers of West Virginia, Inc., for a net purchase price of $16,028 less assumed assets, plus assumed liabilities, net of $28. The total purchase price has been allocated to franchise rights acquired ($10,131), goodwill ($5,212), customer relationship value ($448) and fixed assets ($209). On July 22, 2013, the Company acquired substantially all of the assets of its Columbus, Ohio franchisee, Weight Watchers of Columbus, Inc., for a net purchase price of $23,357 plus assumed liabilities of $143 and its Reno, Nevada franchisee, Weight Watchers of Northern Nevada, Inc., for a net purchase price of $3,969 plus assumed liabilities of $31. The aggregate total purchase price has been allocated to franchise rights acquired ($3,314), goodwill ($23,549), customer relationship value ($494), fixed assets ($116) and inventory ($27). The franchise rights acquired for the Columbus, Ohio franchise purchase were amortized over a five month useful life. On October 28, 2013, the Company acquired substantially all of the assets of its Manitoba, Canada franchisee, Weight Watchers of Manitoba Ltd., for a net purchase price of $5,197 plus assumed liabilities of $28 and its Franklin and St. Lawrence Counties, New York franchisee, Weight Watchers of Franklin and St. Lawrence Counties Inc., for a net purchase price of $274 plus assumed liabilities of $1. The total purchase price of the Manitoba, Canada franchisee has been allocated to franchise rights acquired ($28), goodwill ($4,946), customer relationship value ($249), inventory ($1) and prepaid expenses ($1). The franchise rights acquired were amortized over a two month useful life. The total purchase price of the Franklin and St. Lawrence Counties, New York franchisee has been allocated to franchise rights acquired ($38), goodwill ($223), customer relationship value ($13) and prepaid expenses ($1). The franchise rights acquired were amortized over a nine month useful life. The weighted-average amortization period of the customer relationships acquired in the above acquisitions was approximately 15 weeks. Due to the short-term nature of this asset, its estimated fair value has been recorded as a component of prepaid expenses and other current assets. The acquisitions resulted in goodwill related to, among other things, expected synergies in operations. The goodwill recorded in connection with these acquisitions represents the intangible assets that did not qualify for separate recognition in the financial statements. The Company expects that substantially all of the goodwill recorded in connection with the above acquisitions will be deductible for tax purposes. The effect of these franchise acquisitions was not material to the Company’s consolidated financial position, results of operations, or operating cash flows in the periods presented. Acquisition of Additional Equity Interest in Brazil Prior to March 12, 2014, the Company had owned 35% of VPM, a Brazilian limited liability partnership. On March 12, 2014, the Company acquired an additional 45% equity interest in VPM for a net purchase price of $14,181 less cash acquired of $2,262. VPM was converted into a joint-stock corporation prior to closing and subsequently operates as a subsidiary of the Company with rights to conduct typical business lines. As a result of the acquisition, the Company gained a direct controlling financial interest in VPM and began to consolidate this entity as of the date of acquisition. The equity interest held immediately before the acquisition was $12. An implied fair value technique was used to measure acquisition date fair value of the equity interest to be $11,029. As a result of this transaction, the Company adjusted its previously held equity interest to fair value of $11,017 and recorded a charge of $477 associated with the settlement of the royalty-free arrangement of the Brazilian partnership. The net effect of these items resulted in the Company recognizing a gain of $10,540 ($6,429 after tax or $0.11 per fully diluted share) in the first quarter of fiscal 2014. The fair value of the redeemable noncontrolling interest has been valued at $6,157. In connection with the acquisition, a call option and a put option were granted related to the 20% interest in VPM not owned by the Company. The net purchase price of the Brazil acquisition has been allocated as follows: Fair value of consideration transferred: Net purchase price $ 14,181 Less cash acquired 2,262 Total 11,919 Gain on acquisition 10,540 Redeemable noncontrolling interest 6,157 28,616 Identifiable assets acquired and liabilities assumed: Franchise rights acquired 2,000 Receivables 1,139 Fixed assets 575 Prepaid expenses 421 Inventory 287 Customer relationship value 275 Other assets 199 Accrued liabilities (1,063 ) Deferred tax on acquired intangibles (680 ) Deferred revenue (445 ) Income taxes payable (258 ) Accounts payable (91 ) Total identifiable net assets 2,359 Goodwill $ 26,257 The acquisition resulted in goodwill related to, among other things, expected synergies in operations and the ability of the Company to provide VPM with various intellectual property and technology innovations which will afford additional future opportunities in the meetings and Online businesses within the market where VPM operates. The Company does not expect goodwill to be deductible for tax purposes. Acquisition of Wello On April 16, 2014, the Company acquired Knowplicity, Inc., d/b/a Wello, an online fitness and personal training company for a net purchase price of $8,977 less cash acquired of $11. Payment was in the form of common stock issued ($4,207) and cash ($4,770). The total purchase price of Wello has been allocated to goodwill ($6,204), website development ($4,516), prepaid expenses ($4) and fixed assets ($1) offset by deferred tax liabilities ($1,759). As a result of the acquisition, Wello became a wholly owned subsidiary of the Company and the Company began to consolidate the entity as of the date of acquisition. The acquisition resulted in goodwill related to, among other things, expected synergies in operations. The Company does not expect goodwill to be deductible for tax purposes. Acquisition of Weilos On March 11, 2015, the Company acquired for a purchase price of $6,674 Weilos, a California-based startup with an online social platform that provides a mobile health and weight loss community. Payment was in the form of common stock issued ($2,810), restricted stock issued ($114) and cash ($2,775) plus cash in reserves ($975). The total purchase price of Weilos has been allocated to goodwill ($5,588), identifiable intangibles ($1,741) and other assets ($24) offset by deferred tax liabilities ($679). Restricted shares with a fair value at the date of grant ($908) were issued to key employees, contingent upon 18 months post-combination employment, and are accounted for as stock compensation cost in the post-combination financial statements. As a result of the acquisition, Weilos became a wholly owned subsidiary of the Company and the Company began to consolidate the entity as of the date of acquisition. The acquisition resulted in goodwill related to, among other things, expected synergies in operations. The Company does not expect goodwill to be deductible for tax purposes. Shutdown of China Operations On December 12, 2013, the Company made a strategic decision to shut down its China operations. As a result of this decision, the Company incurred a charge of $2,500 related to severance and the impairment of property, plant and equipment and amortizable intangible assets. |
Franchise Rights Acquired, Good
Franchise Rights Acquired, Goodwill and Other Intangible Assets | 12 Months Ended |
Jan. 02, 2016 | |
Franchise Rights Acquired, Goodwill and Other Intangible Assets | 5. Franchise Rights Acquired, Goodwill and Other Intangible Assets The Company performed its annual impairment review of goodwill and other indefinite-lived intangible assets as of January 2, 2016 and January 3, 2015. As a result of this review, no impairment charges were recorded for the fiscal years ended January 2, 2016 and January 3, 2015. Franchise rights acquired are due to acquisitions of the Company’s franchised territories as well as the acquisition of franchise promotion agreements and other factors associated with the acquired franchise territories. For the fiscal year ended January 2, 2016, the change in the carrying value of indefinite-lived franchise rights acquired is primarily due to the effect of exchange rate changes. Goodwill primarily relates to the acquisition of the Company by H.J. Heinz Company in 1978, the acquisition of WeightWatchers.com, Inc. in 2005, the acquisitions of the Company’s franchised territories, the acquisitions of the majority interest in VPM and of Wello in fiscal 2014 and the acquisition of Weilos in fiscal 2015. See Note 4 for further information on certain acquisitions. For the fiscal year ended January 2, 2016, the change in the carrying amount of goodwill is due to the Weilos acquisition and the effect of exchange rate changes as follows: North America UK CE Other Total Balance as of January 3, 2015 $ 134,611 $ 1,421 $ 7,661 $ 24,586 $ 168,279 Goodwill acquired during the period 5,588 0 0 0 5,588 Effect of exchange rate changes (6,791 ) (51 ) (401 ) (7,293 ) (14,536 ) Balance as of January 2, 2016 $ 133,408 $ 1,370 $ 7,260 $ 17,293 $ 159,331 The carrying values of finite-lived intangible assets as of January 2, 2016 and January 3, 2015 were as follows: January 2, 2016 January 3, 2015 Gross Accumulated Gross Accumulated Capitalized software costs $ 119,658 86,134 $ 107,581 $ 72,590 Website development costs 100,105 68,673 95,717 63,405 Trademarks 10,960 10,435 10,836 10,213 Other 7,976 7,118 7,014 6,825 Trademarks and other intangible assets $ 238,699 $ 172,360 $ 221,148 $ 153,033 Franchise rights acquired 4,182 4,059 4,735 3,690 Total finite-lived intangible assets $ 242,881 $ 176,419 $ 225,883 $ 156,723 Aggregate amortization expense for finite-lived intangible assets was recorded in the amounts of $34,719, $29,372, and $27,567, for the fiscal years ended January 2, 2016, January 3, 2015 and December 28, 2013, respectively. The franchise rights acquired related to the VPM acquisition are being amortized ratably over a 2 year period. Estimated amortization expense of existing finite-lived intangible assets for the next five fiscal years and thereafter is as follows: 2016 $ 32,094 2017 $ 24,726 2018 $ 8,451 2019 $ 1,125 2020 and thereafter $ 66 |
Property and Equipment
Property and Equipment | 12 Months Ended |
Jan. 02, 2016 | |
Property and Equipment | 6. Property and Equipment The components of property and equipment were: January 2, January 3, Equipment $ 122,789 $ 124,788 Leasehold improvements 79,115 79,496 201,904 204,284 Less: Accumulated depreciation and amortization (143,718 ) (129,634 ) $ 58,186 $ 74,650 Depreciation and amortization expense of property and equipment for the fiscal years ended January 2, 2016, January 3, 2015 and December 28, 2013 was $18,452, $20,635, and $20,342, respectively. |
Long-Term Debt
Long-Term Debt | 12 Months Ended |
Jan. 02, 2016 | |
Long-Term Debt | 7. Long-Term Debt The components of the Company’s long-term debt were as follows: January 2, 2016 January 3, 2015 Balance Effective Balance Effective Revolving Facility due April 2, 2018 $ 48,000 2.75 % $ 0 0.00 % Tranche B-1 Term Facility due April 2, 2016 144,323 3.19 % 294,750 3.12 % Tranche B-2 Term Facility due April 2, 2020 2,042,250 4.00 % 2,063,250 3.96 % Total Debt 2,234,573 3.98 % 2,358,000 3.86 % Less Current Portion 213,323 80,728 Total Long-Term Debt $ 2,021,250 $ 2,277,272 The Company’s credit facilities at the end of the first quarter of fiscal 2013 consisted of the following term loan facilities and revolving credit facilities: a tranche B loan (“Term B Loan”), a tranche C loan (“Term C Loan”), a tranche D loan (“Term D Loan”), a tranche E loan (“Term E Loan”), a tranche F loan (“Term F Loan”), revolving credit facility A-1 (“Revolver A-1” ) and revolving credit facility A-2 (“Revolver A-2”). On April 2, 2013, the Company refinanced its credit facilities pursuant to a new Credit Agreement (as amended, supplemented or otherwise modified, the “Credit Agreement”) among the Company, the lenders party thereto, JPMorgan Chase Bank, N.A., as administrative agent and an issuing bank, The Bank of Nova Scotia, as revolving agent, swingline lender and an issuing bank, and the other parties thereto. The Credit Agreement provides for (a) a revolving credit facility (including swing line loans and letters of credit) in an initial aggregate principal amount of $250,000 that will mature on April 2, 2018 (the “Revolving Facility”), (b) an initial term B-1 loan credit facility in an aggregate principal amount of $300,000 that will mature on April 2, 2016 (the “Tranche B-1 Term Facility”) and (c) an initial term B-2 loan credit facility in an aggregate principal amount of $2,100,000 that will mature on April 2, 2020 (the “Tranche B-2 Term Facility”, and together with the Tranche B-1 Term Facility, the “Term Facilities”; the Term Facilities and Revolving Facility collectively, the “WWI Credit Facility”). In connection with this refinancing, the Company used the proceeds from borrowings under the Term Facilities to pay off a total of $2,399,904 of outstanding loans, consisting of $128,759 of Term B Loans, $110,602 of Term C Loans, $117,612 of Term D Loans, $1,125,044 of Term E Loans, $817,887 of Term F Loans, $21,247 of loans under the Revolver A-1 and $78,753 of loans under the Revolver A-2. Following the refinancing of a total of $2,399,904 of loans, at April 2, 2013, the Company had $2,400,000 debt outstanding under the Term Facilities and $248,848 of availability under the Revolving Facility. The Company incurred fees of $44,817 during the second quarter of fiscal 2013 in connection with this refinancing. In the second quarter of fiscal 2013, the Company wrote-off fees associated with this refinancing which resulted in the Company recording a charge of $21,685 in early extinguishment of debt. On September 26, 2014, the Company and certain lenders entered into an agreement amending the Credit Agreement that, among other things, eliminated the Financial Covenant (as defined in the Credit Agreement) with respect to the Revolving Facility. In connection with this amendment, the Company wrote-off deferred financing fees of approximately $1,583 in the third quarter of fiscal 2014. Concurrently with and in order to effect this amendment, the Company reduced the amount of the Revolving Facility from $250,000 to $50,000. Under the terms of the Credit Agreement, depending on the Company’s Consolidated Leverage Ratio (as defined in the Credit Agreement), the Company is obligated to offer to prepay the Term Facilities in an aggregate amount determined by its excess cash flow (as defined in the Credit Agreement). On March 13, 2015, the Company commenced an offer to prepay at a discount to par up to $75,000 in aggregate principal amount of term loans outstanding under the Tranche B-1 Term Facility. On March 20, 2015, the Company accepted offers with a discount equal to or greater than 9.00% in respect of such term loans. On March 25, 2015, the Company paid an aggregate amount of cash proceeds totaling $57,389 plus an amount sufficient to pay accrued and unpaid interest on the amount prepaid to prepay $63,065 in aggregate principal amount of such term loans under the Tranche B-1 On June 17, 2015, the Company commenced another offer to prepay at a discount to par up to $229,000 in aggregate principal amount of term loans outstanding under the Tranche B-1 Term Facility. On June 22, 2015, the Company accepted offers with a discount equal to or greater than 9.00% in respect of such term loans. On June 26, 2015, the Company paid an aggregate amount of cash proceeds totaling $77,225 plus an amount sufficient to pay accrued and unpaid interest on the amount prepaid to prepay $84,862 in aggregate principal amount of such term loans under the Tranche B-1 Term Facility. As a result of this prepayment, the Company wrote-off fees of $321, incurred fees of $641 and recorded a gain on early extinguishment of debt of $6,677, inclusive of these fees, in the second quarter of fiscal 2015. On July 14, 2015, the Company drew down the $48,000 available on its Revolving Facility in order to enhance its cash position and to provide additional financial flexibility. The revolver borrowing has been classified as a short-term liability in consideration of the fact that the terms of the Revolving Facility require an assessment as to whether there have been any material adverse changes with respect to the Company in connection with the Company’s monthly interest elections. Although the revolver borrowing has been classified as a short-term liability, absent any change in fact and circumstance, the Company has the ability to extend and not repay the Revolving Facility until its due date of April 2, 2018. At January 2, 2016, under the WWI Credit Facility, the Company had $2,186,573 outstanding consisting entirely of term loans, and borrowings of $48,000 outstanding under the Revolving Facility. In addition, at January 2, 2016, the Revolving Facility had $1,819 in issued but undrawn letters of credit outstanding thereunder and $181 in available unused commitments thereunder. The proceeds from borrowings under the Revolving Facility (including swing line loans and letters of credit) are available to be used for working capital and general corporate purposes. Borrowings under the Credit Agreement bear interest at a rate equal to, at the Company’s option, LIBOR plus an applicable margin or a base rate plus an applicable margin. LIBOR under the Tranche B-2 Term Facility is subject to a minimum interest rate of 0.75% and the base rate under the Tranche B-2 Term Facility is subject to a minimum interest rate of 1.75%. Under the terms of the Credit Agreement, in the event the Company receives a corporate rating of BB- (or lower) from S&P and a corporate rating of Ba3 (or lower) from Moody’s, the applicable margin relating to both of the Term Facilities would increase by 25 basis points. On February 21, 2014, both S&P and Moody’s issued revised corporate ratings of the Company of B+ and B1, respectively. As a result, effective February 21, 2014, the applicable margin on borrowings under the Tranche B-1 Term Facility went from 2.75% to 3.00% and on borrowings under the Tranche B-2 Term Facility went from 3.00% to 3.25%. The applicable margin relating to the Revolving Facility will fluctuate depending upon the Company’s Consolidated Leverage Ratio. At January 2, 2016, borrowings under the Tranche B-1 Term Facility bore interest at LIBOR plus an applicable margin of 3.00% and borrowings under the Tranche B-2 Term Facility bore interest at LIBOR plus an applicable margin of 3.25%. Based on the Company’s Consolidated Leverage Ratio as of January 2, 2016, borrowings under the Revolving Facility bore interest at LIBOR plus an applicable margin of 2.50%. On a quarterly basis, the Company will pay a commitment fee to the lenders under the Revolving Facility in respect of unutilized commitments thereunder, which commitment fee will fluctuate depending upon the Company’s Consolidated Leverage Ratio. Based on the Company’s Consolidated Leverage Ratio as of January 2, 2016, the commitment fee was 0.50% per annum. For the fiscal year ended January 2, 2016, the Company paid $186 in commitment fees. The Company also will pay customary letter of credit fees and fronting fees under the Revolving Facility, which totaled $48 for the fiscal year ended January 2, 2016. The Credit Agreement contains customary covenants including covenants that, in certain circumstances, restrict the Company’s ability to incur additional indebtedness, pay dividends on and redeem capital stock, make other payments, including investments, sell its assets and enter into consolidations, mergers and transfers of all or substantially all of its assets. The WWI Credit Facility does not require the Company to meet any financial maintenance covenants and is guaranteed by certain of the Company’s existing and future subsidiaries. Substantially all of the Company’s assets secure the WWI Credit Facility. At January 2, 2016 and January 3, 2015, the Company’s debt consisted entirely of variable-rate instruments. Interest rate swaps were entered into to hedge a portion of the cash flow exposure associated with the Company’s variable-rate borrowings. The weighted average interest rate on the Company’s debt, exclusive of the impact of swaps, was approximately 3.93% and 3.90% per annum based on interest rates at January 2, 2016 and January 3, 2015, respectively. The weighted average interest rate on the Company’s debt, including the impact of swaps, was approximately 5.03% and 4.93% per annum based on interest rates at January 2, 2016 and January 3, 2015, respectively. Maturities At January 2, 2016, the aggregate amounts of the Company’s existing long-term debt maturing in each of the next five fiscal years were as follows: 2016 $ 213,323 2017 21,000 2018 21,000 2019 21,000 2020 1,958,250 $ 2,234,573 |
Treasury Stock
Treasury Stock | 12 Months Ended |
Jan. 02, 2016 | |
Treasury Stock | 8. Treasury Stock On October 9, 2003, the Company’s Board of Directors authorized and the Company announced a program to repurchase up to $250,000 of the Company’s outstanding common stock. On each of June 13, 2005, May 25, 2006 and October 21, 2010, the Company’s Board of Directors authorized and the Company announced adding $250,000 to the program. The repurchase program allows for shares to be purchased from time to time in the open market or through privately negotiated transactions. No shares will be purchased from Artal Holdings, Sp. z o.o., Succursale de Luxembourg and its parents and subsidiaries under the program. The repurchase program currently has no expiration date. During the fiscal years ended January 2, 2016, January 3, 2015 and December 28, 2013, the Company purchased no shares of its common stock in the open market under the repurchase program. As of the end of fiscal 2015, $208,933 remained available to purchase shares of our common stock under the repurchase program. |
Earnings Per Share
Earnings Per Share | 12 Months Ended |
Jan. 02, 2016 | |
Earnings Per Share | 9. Earnings Per Share Basic earnings per share (“EPS”) are calculated utilizing the weighted average number of common shares outstanding during the periods presented. Diluted EPS is calculated utilizing the weighted average number of common shares outstanding during the periods presented adjusted for the effect of dilutive common stock equivalents. The following table sets forth the computation of basic and diluted EPS for the fiscal years ended: January 2, January 3, December 28, Numerator: Net income attributable to Weight Watchers International, Inc. $ 32,945 $ 117,787 $ 202,742 Denominator: Weighted average shares of common stock outstanding 58,369 56,607 56,144 Effect of dilutive common stock equivalents 597 98 250 Weighted average diluted common shares outstanding 58,966 56,705 56,394 Earnings Per Share attributable to Weight Watchers International, Inc. Basic $ 0.56 $ 2.08 $ 3.61 Diluted $ 0.56 $ 2.08 $ 3.60 The number of anti-dilutive common stock equivalents excluded from the calculation of the weighted average number of common shares for diluted EPS was 1,699, 3,073, and 1,285 for the years ended January 2, 2016, January 3, 2015 and December 28, 2013, respectively. |
Stock Plans
Stock Plans | 12 Months Ended |
Jan. 02, 2016 | |
Stock Plans | 10. Stock Plans Incentive Compensation Plans and Winfrey Option On May 6, 2008 and May 12, 2004, respectively, the Company’s shareholders approved the 2008 Stock Incentive Plan (the “2008 Plan”) and the 2004 Stock Incentive Plan (the “2004 Plan”). On May 6, 2014, the Company’s shareholders approved the 2014 Stock Incentive Plan (as amended, the “2014 Plan” and together with the 2004 Plan and the 2008 Plan, the “Stock Plans”), which replaced the 2008 Plan and 2004 Plan for all equity-based awards granted on or after May 6, 2014. The 2014 Plan is designed to promote the long-term financial interests and growth of the Company by attracting, motivating and retaining employees with the ability to contribute to the success of the business and to align compensation for the Company’s employees over a multi-year period directly with the interests of the shareholders of the Company. The Company’s Board of Directors or a committee thereof administers the 2014 Plan. Under the 2014 Plan, grants may take the following forms at the Compensation and Benefit Committee’s discretion: non-qualified stock options, incentive stock options, stock appreciation rights, restricted stock units (“RSUs”), restricted stock and other share-based awards. As of its effective date, the maximum number of shares of common stock available for grant under the 2014 Plan was 3,500, subject to increase and adjustment as set forth in the 2014 Plan. Under the 2014 Plan, the Company also grants fully-vested shares of its common stock to certain members of its Board of Directors. While these shares are fully vested the directors are restricted from selling these shares while they are still serving on the Company’s Board of Directors. During the fiscal years ended January 2, 2016, January 3, 2015 and December 28, 2013, the Company granted 50, 20, and 14, fully-vested shares, respectively, and recognized compensation expense of $507, $497, and $524, respectively. From time to time, the Company has granted fully-vested shares of its common stock to individuals in connection with special circumstances. In fiscal 2015, the Company granted an aggregate of 105 fully-vested shares of its common stock to individuals under such special circumstances. Under the Winfrey Option Agreement, the Company granted Ms. Winfrey a fully vested non-qualified option to purchase 3,513 shares of its common stock as more fully described in Note 3. The Company issues common stock for share-based compensation awards from treasury stock. The total compensation cost that has been charged against income for these plans and the Winfrey Option, as applicable, was $24,771, $10,533, and $4,255 for the years ended January 2, 2016, January 3, 2015 and December 28, 2013, respectively. Such amounts have been included as a component of selling, general and administrative expenses. The total income tax benefit recognized in the income statement for all share-based compensation arrangements was $8,170, $3,285, and $1,174 for the years ended January 2, 2016, January 3, 2015 and December 28, 2013, respectively. The tax benefits realized from options exercised and RSUs vested totaled $274, $301, and $4,217 for the years ended January 2, 2016, January 3, 2015 and December 28, 2013, respectively. No compensation costs were capitalized. As of January 2, 2016, there was $19,600 of total unrecognized compensation cost related to stock options and RSUs granted under the Stock Plans. That cost is expected to be recognized over a weighted-average period of approximately 1.5 years. While the Stock Plans permit various types of awards, other than the aforementioned shares issued to directors and certain individuals in connection with special circumstances, grants under the plans have historically been either non-qualified stock options or RSUs. In fiscal 2015, 2014 and 2013, the Company also granted special performance-based stock option awards. The following describes some further details of these awards. Stock Option Awards Under Stock Plans Option Awards with Time Vesting Criteria Pursuant to the option components of the Stock Plans, the Company’s Board of Directors authorized the Company to enter into agreements under which certain employees received stock options with time vesting criteria (“Time Vesting Options”). The options are exercisable based on the terms outlined in the agreements. Time Vesting Options outstanding at January 2, 2016 and January 3, 2015 vest over a period of three to five years and the expiration term is ten years. Time Vesting Options outstanding at January 2, 2016 and January 3, 2015 have an exercise price between $3.97 and $63.59 per share. The fair value of each of these option awards is estimated on the date of grant using the Black-Scholes option pricing model with the weighted average assumptions noted in the following table. Expected volatility is based on the historical volatility of the Company’s stock. Since the Company’s option exercise history is limited, it has estimated the expected term of these option grants to be the midpoint between the vesting period and the contractual term of each award. The risk free interest rate is based on the U.S. Treasury yield curve in effect on the date of grant which most closely corresponds to the expected term of the Time Vesting Options. The dividend yield is based on our historic average dividend yield. The Company did not grant any Time Vesting Options in fiscal 2014. January 2, 2016 January 3, December 28, Dividend yield 0.0% 0.0% 0.8% Volatility 41.0% 0.0% 36.5% Risk-free interest rate 1.84% - 1.89% 0% - 0% 1.3% - 2.2% Expected term (years) 6.0 0.0 6.5 Option Awards with Time and Performance Vesting Criteria Pursuant to the option components of the Stock Plans, the Company’s Board of Directors authorized the Company to enter into agreements under which certain employees received stock options with both time and performance vesting criteria (“T&P Vesting Options”). As of the end of fiscal 2015, there were no outstanding T&P Vesting Options. The options were exercisable based on the terms outlined in the agreements. During fiscal 2015, fiscal 2014 and fiscal 2013, the Company granted 37, 1,601 and 687 T&P Vesting Options, respectively, to certain employees that would have vested based on the achievement of both time and performance vesting criteria. The time-vesting criteria would have been 100% satisfied on the third anniversary of the date of the grant and the performance criteria was contingent upon meeting or exceeding certain stock price hurdles. With respect to the performance-vesting criteria, the stock options would have fully vested in 20% increments upon the first date that the average closing stock price for the 20 consecutive preceding trading days was equal to or greater than specified stock price hurdles. The fair value of the T&P Vesting Options was estimated on the date of grant and was based on the likelihood of the Company achieving the performance conditions. The Company estimated the fair value using a Monte Carlo simulation that used various assumptions that included expected volatility, a risk free rate and an expected term. Expected volatility was based on the historical volatility of the Company’s stock. The risk-free interest rate was based on the U.S. Treasury yield curve in effect on the date of grant which most closely corresponds to the performance measurement period. The expected term represents the period from the grant date to the end of the five year performance period. Compensation expense on T&P Vesting Options is recognized ratably over the three year required service period as this period is longer than the derived service period calculated by the Monte Carlo simulation. January 2, January 3, December 28, Dividend yield 0.0% 0.0% 0.0% Volatility 40.5% 37.8% 36.5% Risk-free interest rate 1.6% 1.4% - 1.8% 2% Expected term (years) 5.0 5.0 5.0 On May 7, 2015, the Company’s shareholders approved an amendment to the 2014 Plan to permit a one-time stock option exchange program under which the Company would offer eligible employees the opportunity to exchange certain eligible T&P Vesting Options on a (a) two-for-one basis for new stock options for all eligible employees, other than the Company’s Chief Executive Officer (i.e., so that the new stock options would cover half as many shares as the corresponding surrendered options) and (b) 3.5-for-one basis for new stock options for the Company’s Chief Executive Officer (i.e., so that the new stock options would cover a number of shares equal to the quotient of the number of shares covered by the corresponding surrendered options divided by 3.5). The option exchange program was designed to create better incentives for employees to remain with the Company and contribute to the attainment of its business and financial objectives. On May 22, 2015, the Company launched a tender offer in connection with the option exchange program which expired on June 22, 2015. Pursuant to the offer, employees tendered options to purchase 1,700 shares of common stock (representing 99.6% of the total shares of common stock underlying the options eligible for exchange) with a weighted-average exercise price of $24.68 per share. The Company cancelled and replaced those options on June 22, 2015 with options to purchase 734 shares of common stock with an exercise price of $5.25 per share, which was the closing price per share of the Company’s common stock on the New York Stock Exchange on June 22, 2015. The replacement options vest over three years, with 25% vesting on each of the first and second anniversaries of the date of grant and 50% vesting on the third anniversary of the date of grant. The option exchange resulted in an incremental stock option expense of $1,599, which was determined by comparing the fair value of the T&P Vesting Option as calculated based on a Monte Carlo simulation, to the fair value of the replacement options, as calculated using the Black-Scholes option pricing model, for the eligible options at the time of exchange. This incremental expense, along with the unamortized expense associated with the cancelled options, is being recognized ratably over the new vesting period of the replacement options, which is three years. Option Activity A summary of all option activity under the Stock Plans and the Winfrey Option (see Note 3 for additional disclosure regarding the Winfrey Option) for the year ended January 2, 2016 is presented below: Shares Weighted- Weighted- Aggregate Outstanding at January 3, 2015 3,250 $ 30.72 Granted 4,572 6.61 Exercised (4 ) 22.67 Exchanged (1,700 ) 24.68 Cancelled (788 ) 31.94 Outstanding at January 2, 2016 5,330 $ 11.79 9.2 $ 73,260 Exercisable at January 2, 2016 3,916 $ 10.62 9.3 $ 55,772 The weighted-average grant-date fair value of all options granted (including the Winfrey Option as described in Note 3) was $4.86, $6.51, and $11.37 for the years ended January 2, 2016, January 3, 2015 and December 28, 2013, respectively. The total intrinsic value of Time Vesting Options exercised was $17, $62, and $9,858 for the years ended January 2, 2016, January 3, 2015 and December 28, 2013, respectively. Cash received from Time Vesting Options exercised during the years ended January 2, 2016, January 3, 2015 and December 28, 2013 was $95, $658, and $16,187, respectively. Restricted Stock Units Under Stock Plans Pursuant to the restricted stock components of the Stock Plans, the Company’s Board of Directors authorized the Company to enter into agreements under which certain employees received RSUs. The RSUs are exercisable based on the terms outlined in the agreements. The RSUs vest over a period of three to five years. The fair value of RSUs is determined using the closing market price of the Company’s common stock on the date of grant. A summary of RSU activity under the Stock Plans for the year ended January 2, 2016 is presented below: Shares Weighted-Average Fair Value Outstanding at January 3, 2015 838 $ 27.71 Granted 780 $ 5.55 Vested (35 ) $ 51.18 Forfeited (217 ) $ 26.25 Outstanding at January 2, 2016 1,366 $ 27.71 The weighted-average grant-date fair value of RSUs granted was $5.55, $24.37, and $38.40 for the years ended January 2, 2016, January 3, 2015 and December 28, 2013, respectively. The total fair value of RSUs vested during the years ended January 2, 2016, January 3, 2015 and December 28, 2013 was $1,804, $3,042, and $1,705, respectively. |
Income Taxes
Income Taxes | 12 Months Ended |
Jan. 02, 2016 | |
Income Taxes | 11. Income Taxes The following tables summarize the Company’s consolidated provision for US federal, state and foreign taxes on income: January 2, January 3, December 28, Current: US federal $ (6,862 ) $ 12,904 $ 60,030 State 1,859 (131 ) 9,583 Foreign 15,740 24,059 25,647 $ 10,737 $ 36,832 $ 95,260 Deferred: US federal $ 10,756 $ 25,162 $ 30,513 State 1,890 2,876 3,487 Foreign (548 ) 1,061 358 $ 12,098 $ 29,099 $ 34,358 Total tax provision $ 22,835 $ 65,931 $ 129,618 The components of the Company’s consolidated income before income taxes consist of the following: January 2, January 3, December 28, Domestic $ 6,299 $ 88,024 $ 248,637 Foreign 49,315 95,640 83,723 $ 55,614 $ 183,664 $ 332,360 The difference between the US federal statutory tax rate and the Company’s consolidated effective tax rate is as follows: January 2, January 3, December 28, US federal statutory rate 35.0 % 35.0 % 35.0 % States income taxes (net of federal benefit) 3.8 1.3 2.7 Reserves for uncertain tax positions 3.5 0.4 (0.1 ) Foreign taxes (0.4 ) (0.6 ) 0.4 (Decrease) increase in valuation allowance (2.2 ) 1.7 0.9 Loss on closure of China 0.0 (2.1 ) 0.0 Other 1.4 0.2 0.1 Effective tax rate 41.1 % 35.9 % 39.0 % The deferred tax assets and liabilities recorded on the Company’s consolidated balance sheets are as follows: January 2, January 3, Provision for estimated expenses $ 4,638 $ 7,863 Depreciation 4,164 0 Operating loss carryforwards 34,285 37,746 Salaries and wages 641 9,567 Share-based compensation 14,330 6,653 Other 8,024 6,922 Other comprehensive income 24,778 13,060 Less: valuation allowance (28,279 ) (34,640 ) Total deferred tax assets $ 62,581 $ 47,171 Depreciation $ 0 $ (6,482 ) Other (1,823 ) (3,123 ) Amortization (210,901 ) (188,745 ) Total deferred tax liabilities $ (212,724 ) $ (198,350 ) Net deferred tax liabilities $ (150,143 ) $ (151,179 ) Certain foreign operations of the Company have generated net operating loss carryforwards. If it has been determined that it is more-likely-than-not that the deferred tax assets associated with these net operating loss carryforwards will not be utilized, a valuation allowance has been recorded. As of January 2, 2016 and January 3, 2015, various foreign subsidiaries had net operating loss carryforwards of approximately $138,562 and $142,433, respectively, most of which can be carried forward indefinitely. The Company’s undistributed earnings of substantially all of its foreign subsidiaries are not considered to be permanently reinvested. Accordingly, the Company has recorded all taxes, after taking into account foreign tax credits, on the undistributed earnings of these foreign subsidiaries. The undistributed earnings of the remaining foreign subsidiaries are indefinitely invested outside the United States. We have not recorded a deferred tax liability of approximately $10,000 for the U.S. income taxes on the undistributed earnings of these foreign subsidiaries. A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows: January 2, January 3, December 28, Balance at beginning of year $ 6,268 $ 5,784 $ 5,319 Additions based on tax positions related to the current year 2,106 1,304 1,428 Reductions for tax positions of prior years (676 ) (820 ) (963 ) Balance at end of year $ 7,698 $ 6,268 $ 5,784 At January 2, 2016, the total amount of unrecognized tax benefits that, if recognized, would affect our effective tax rate is $6,948. As of January 2, 2016, given the nature of the Company’s uncertain tax positions, it is reasonably possible that there will not be a significant change in the Company’s uncertain tax benefits within the next twelve months. The Company recognizes interest and penalties related to unrecognized tax benefits in income tax expense. The Company had $1,229 and $2,300 of accrued interest and penalties at January 2, 2016 and January 3, 2015, respectively. The Company recognized $(266), $83, and $(1,188) in interest and penalties during the fiscal years ended January 2, 2016, January 3, 2015 and December 28, 2013, respectively. The Company or one of its subsidiaries files income tax returns in the US federal jurisdiction, and various state and foreign jurisdictions. At January 2, 2016, with few exceptions, the Company was no longer subject to US federal, state or local income tax examinations by tax authorities for years prior to 2012, or non-US income tax examinations by tax authorities for years prior to 2009. |
Employee Benefit Plans
Employee Benefit Plans | 12 Months Ended |
Jan. 02, 2016 | |
Employee Benefit Plans | 12. Employee Benefit Plans The Company sponsors the Third Amended and Restated Weight Watchers Savings Plan (the “Savings Plan”) for salaried and certain hourly US employees of the Company. The Savings Plan is a defined contribution plan that provides for employer matching contributions of 100% of the employee’s tax deferred contributions up to 3% of an employee’s eligible compensation for the fiscal years ended January 2, 2016, January 3, 2015 and December 28, 2013. Expense related to these contributions for the fiscal years ended January 2, 2016, January 3, 2015 and December 28, 2013 was $2,454, $2,525, and $2,888, respectively. During fiscal 2014, the Company received a favorable determination letter from the IRS that qualifies the Savings Plan under Section 401(a) of the Internal Revenue Code. Pursuant to the Savings Plan, the Company also makes profit sharing contributions for all full-time salaried US employees who are eligible to participate in the Savings Plan (except for certain management personnel). The profit sharing contribution is a guaranteed monthly employer contribution on behalf of each participant based on the participant’s age and a percentage of the participant’s eligible compensation. The Savings Plan also has a discretionary supplemental profit sharing employer contribution component that is determined annually by the Compensation and Benefits Committee of the Company’s Board of Directors. Expense related to these contributions for the fiscal years ended January 2, 2016, January 3, 2015 and December 28, 2013 was $733, $266, and $1,658, respectively. For certain US management personnel, the Company sponsors the Second Amended and Restated Weight Watchers Executive Profit Sharing Plan (“EPSP”). Under the IRS definition, the EPSP is considered a Nonqualified Deferred Compensation Plan. There is a promise of payment by the Company made on the employees’ behalf instead of an individual account with a cash balance. The EPSP provides for a guaranteed employer contribution on behalf of each participant based on the participant’s age and a percentage of the participant’s eligible compensation. The EPSP has a discretionary supplemental employer contribution component that is determined annually by the Compensation and Benefits Committee of the Company’s Board of Directors. The account is valued at the end of each fiscal month, based on an annualized interest rate of prime plus 2%, with an annualized cap of 15%. Expense related to this commitment for the fiscal years ended January 2, 2016, January 3, 2015 and December 28, 2013 was $1,950, $1,090, and $2,651, respectively. |
Cash Flow Information
Cash Flow Information | 12 Months Ended |
Jan. 02, 2016 | |
Cash Flow Information | 13. Cash Flow Information January 2, January 3, December 28, Net cash paid during the year for: Interest expense $ 117,602 $ 123,100 $ 99,687 Income taxes $ 25,566 $ 35,232 $ 87,071 Noncash investing and financing activities were as follows: Fair value of net assets/(liabilities) acquired in connection with acquisitions $ 1,439 $ 359 $ (175 ) Change in Capital expenditures and Capitalized software included in accounts payable and accrued expenses $ (1,969 ) $ 3,347 $ (5,432 ) Dividends declared but not yet paid at year-end $ 0 $ 0 $ 177 |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Jan. 02, 2016 | |
Commitments and Contingencies | 14. Commitments and Contingencies In re Weight Watchers International, Inc. Securities Litigation In March 2014, two substantially identical putative class action complaints alleging violation of the federal securities laws were filed by individual shareholders against the Company, certain of the Company’s current and former officers and directors, and Artal Group S.A. (“Artal”) in the United States District Court for the Southern District of New York. The complaints were purportedly filed on behalf of all purchasers of the Company’s common stock, no par value per share, between February 14, 2012 and October 30, 2013, inclusive (the “Class Period”). The complaints allege that, during the Class Period, the defendants disseminated materially false and misleading statements and/or concealed material adverse facts. The complaints allege claims under Sections 10(b) and 20(a) of the Securities Exchange Act of 1934, as amended, and Rule 10b-5 thereunder. The plaintiffs seek to recover unspecified damages on behalf of the class members. In June 2014, the Court consolidated the cases and appointed lead plaintiffs and lead counsel. On August 12, 2014, the plaintiffs filed an amended complaint that, among other things, reduced the Class Period to between February 14, 2012 and February 13, 2013 and dropped all current officers and certain directors previously named as defendants. On October 14, 2014, the defendants filed a motion to dismiss. The plaintiffs filed an opposition to the defendants’ motion to dismiss on November 24, 2014 and the defendants filed a reply in support of their motion to dismiss on December 23, 2014. The Company continues to believe that the suits are without merit and intends to defend them vigorously. Tracey Mead, Derivatively on Behalf of Weight Watchers International, Inc. vs. Artal Group et. al. and Weight Watchers International, Inc. On May 29, 2014 and June 23, 2014, the Company received shareholder litigation demand letters alleging breaches of fiduciary duties and unjust enrichment by Company officers and directors and Artal, to the alleged injury of the Company. The allegations in the letters relate to those contained in the ongoing federal securities litigation described above. In response to the letters, pursuant to Virginia law, the Board of Directors has created a special committee to review and evaluate the facts and circumstances surrounding the claims made in the demand letters. The special committee has decided to undertake its review after receiving a decision on defendants’ motion to dismiss in the federal securities litigation given the overlapping issues. On August 11, 2015, a purported shareholder derivative lawsuit was filed in New York State Court in Westchester County. The complaint alleges that certain Company directors and executive officers breached their various fiduciary duties by knowingly causing the Company to repurchase shares from Artal and from certain executive officers at artificially inflated prices in connection with a tender offer made to all shareholders. The complaint seeks an order for the defendants to disgorge all profits made from selling Company stock between March 16, 2012 and April 9, 2012, as well as an award for damages sustained by the alleged breaches of fiduciary duty. The parties sought to stay this suit pending a decision on defendants’ motion to dismiss in the federal securities litigation asserting similar allegations. The Court denied the stay, but at the preliminary court conference on December 17, 2015, the Court granted an adjournment and scheduled the next court conference for April 29, 2016. The Company believes that the suit is without merit and intends to defend it vigorously. Raymond Roberts v. Weight Watchers International, Inc. On January 7, 2016, an Online Plus Plus Other Litigation Matters Due to the nature of the Company’s activities, it is also, at times, subject to pending and threatened legal actions that arise out of the ordinary course of business. In the opinion of management, the disposition of any such matters is not expected to have a material effect on the Company’s results of operations, financial condition or cash flows. Commitments Minimum commitments under non-cancelable obligations, primarily for office and rental facilities operating leases at January 2, 2016, consist of the following: 2016 $ 46,086 2017 30,650 2018 20,214 2019 15,098 2020 12,093 2021 and thereafter 95,437 Total $ 219,578 Total rent expense charged to operations under these operating leases for the fiscal years ended January 2, 2016, January 3, 2015 and December 28, 2013 was $42,133, $44,228, and $46,300, respectively. |
Segment and Geographic Data
Segment and Geographic Data | 12 Months Ended |
Jan. 02, 2016 | |
Segment and Geographic Data | 15. Segment and Geographic Data The Company has four reportable segments based on an integrated geographical structure as follows: North America, United Kingdom, Continental Europe (CE) and Other. Other consists of Asia Pacific and emerging markets operations and franchise revenues and related costs, all of which have been grouped together as if they were a single reportable segment because they do not meet any of the quantitative thresholds and are immaterial for separate disclosure. To be consistent with the information that is presented to the chief operating decision maker, the Company does not include intercompany activity in the segment results. Total Revenue for the Year Ended January 2, January 3, December 28, North America $ 755,396 $ 947,716 $ 1,163,002 United Kingdom 124,773 156,843 172,783 Continental Europe 229,147 298,878 299,403 Other 55,103 76,479 88,935 Total revenue $ 1,164,419 $ 1,479,916 $ 1,724,123 Net Income for the Year Ended January 2, January 3, December 28, Segment operating income: North America $ 140,579 $ 250,282 $ 403,104 United Kingdom 24,310 29,187 34,429 Continental Europe 62,364 79,282 66,273 Other 8,007 13,676 13,774 Total segment operating income 235,260 372,427 517,580 General corporate expenses (67,202 ) (73,113 ) (59,828 ) Interest expense 121,843 122,984 103,108 Other expense, net 2,027 3,206 599 Gain on Brazil acquisition 0 (10,540 ) 0 (Gain) loss on early extinguishment of debt (11,426 ) 0 21,685 Provision for taxes 22,835 65,931 129,618 Net income 32,779 117,733 202,742 Net income attributable to noncontrolling interest 166 54 — Net income attributable to Weight Watchers International, Inc. $ 32,945 $ 117,787 $ 202,742 Depreciation and Amortization for the Year Ended January 2, January 3, December 28, North America $ 47,128 $ 34,654 $ 35,928 United Kingdom 766 1,158 1,269 Continental Europe 1,861 2,356 2,222 Other 1,473 2,144 1,965 Total segment depreciation and amortization 51,228 40,312 41,384 General corporate depreciation and amortization 8,829 18,227 14,197 Depreciation and amortization $ 60,057 $ 58,539 $ 55,581 The following tables present information about the Company’s sources of revenue and other information by geographic area. There were no material amounts of sales or transfers among geographic areas and no material amounts of US export sales. Revenues for the Year Ended January 2, January 3, December 28, Meeting Fees $ 587,801 $ 744,560 $ 851,626 Online Subscription Revenues 349,567 437,385 509,135 In-meeting product sales 127,291 169,101 211,963 Licensing, franchise royalties and other 99,760 128,870 151,399 $ 1,164,419 $ 1,479,916 $ 1,724,123 Revenues for the Year Ended January 2, January 3, December 28, United States $ 700,972 $ 869,541 $ 1,067,200 Canada 54,277 78,175 95,802 United Kingdom 124,773 156,843 172,783 Continental Europe 229,147 298,878 299,403 Other 55,250 76,479 88,935 $ 1,164,419 $ 1,479,916 $ 1,724,123 Long-Lived Assets January 2, January 3, December 28, United States $ 51,103 $ 67,903 $ 79,448 Canada 2,757 3,149 3,070 United Kingdom 2,938 724 1,192 Continental Europe 614 1,454 2,083 Other 774 1,420 1,259 $ 58,186 $ 74,650 $ 87,052 |
Fair Value Measurements
Fair Value Measurements | 12 Months Ended |
Jan. 02, 2016 | |
Fair Value Measurements | 16. Fair Value Measurements Accounting guidance on fair value measurements for certain financial assets and liabilities requires that assets and liabilities carried at fair value be classified and disclosed in one of the following three categories: • Level 1—Quoted prices in active markets for identical assets or liabilities. • Level 2—Observable inputs other than Level 1 prices, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. • Level 3—Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. When measuring fair value, the Company is required to maximize the use of observable inputs and minimize the use of unobservable inputs. Fair Value of Financial Instruments The Company’s significant financial instruments include long-term debt and interest rate swap agreements. The fair value of the Company’s borrowings under the Revolving Facility approximates a carrying value of $48,000 due to the nature of the debt. The fair value of the Company’s Term Facilities is determined by utilizing average bid prices on or near the end of each fiscal quarter (Level 2 input). As of January 2, 2016 and January 3, 2015, the fair value of the Company’s long-term debt was approximately $1,682,778 and $1,888,051, respectively, as compared to carrying value of $2,186,573 and $2,358,000, respectively. Derivative Financial Instruments The fair values for the Company’s derivative financial instruments are determined using observable current market information such as the prevailing LIBOR interest rate and LIBOR yield curve rates and include consideration of counterparty credit risk. See Note 17 for disclosures related to derivative financial instruments. The following table presents the aggregate fair value of the Company’s derivative financial instruments: Fair Value Measurements Using: Total Quoted Prices in Significant Other Significant Interest rate swap liability at January 2, 2016 $ 44,170 $ 0 $ 44,170 $ 0 Interest rate swap liability at January 3, 2015 $ 42,423 $ 0 $ 42,423 $ 0 The Company did not have any transfers into or out of Levels 1 and 2, and did not maintain any assets or liabilities classified as Level 3, during the fiscal years ended January 2, 2016 and January 3, 2015. |
Derivative Instruments and Hedg
Derivative Instruments and Hedging | 12 Months Ended |
Jan. 02, 2016 | |
Derivative Instruments and Hedging | 17. Derivative Instruments and Hedging As of January 2, 2016 and January 3, 2015, the Company had in effect an interest rate swap with a notional amount totaling $1,500,000. In January 2009, the Company entered into a forward-starting interest rate swap which had an effective date of January 4, 2010 and a termination date of January 27, 2014. From December 29, 2012 through April 1, 2013, this swap had qualified for hedge accounting, and therefore changes in the fair value of this derivative were recorded in accumulated other comprehensive income (loss). Effective April 2, 2013, due to the Company’s debt refinancing, the Company ceased the application of hedge accounting for this swap. Accordingly, changes in the fair value of this swap were recorded in earnings subsequent to April 2, 2013 and were immaterial for the fiscal year ended January 3, 2015. On July 26, 2013, in order to hedge an additional portion of its variable rate debt, the Company entered into a forward-starting interest rate swap with an effective date of March 31, 2014 and a termination date of April 2, 2020. The initial notional amount of this swap was $1,500,000. During the term of this swap, the notional amount will decrease from $1,500,000 effective March 31, 2014 to $1,250,000 on April 3, 2017 with a further reduction to $1,000,000 on April 1, 2019. This interest rate swap effectively fixes the variable interest rate on the notional amount of this swap at 2.38%. This swap qualifies for hedge accounting and, therefore, changes in the fair value of this swap have been recorded in accumulated other comprehensive income (loss). As of January 2, 2016 and January 3, 2015, cumulative unrealized losses for qualifying hedges were reported as a component of accumulated other comprehensive loss in the amounts of $23,135 ($38,053 before taxes) and $21,856 ($35,830 before taxes), respectively. The Company is hedging forecasted transactions for periods not exceeding the next six years. The Company expects approximately $10,796 ($17,698 before taxes) of derivative losses included in accumulated other comprehensive loss at January 2, 2016, based on current market rates, will be reclassified into earnings within the next 12 months. |
Accumulated Other Comprehensive
Accumulated Other Comprehensive Loss | 12 Months Ended |
Jan. 02, 2016 | |
Accumulated Other Comprehensive Loss | 18. Accumulated Other Comprehensive Loss With respect to the disclosure of the amounts reclassified from accumulated other comprehensive income for the fiscal year ended January 3, 2015 the Company has revised the amounts previously disclosed to correct those amounts by increasing the amount reclassified related to the Loss on Qualifying Hedges from $7,413 to $19,815 and $4,522 to $12,087 on a pre- and after-tax basis, respectively. Amounts reclassified out of accumulated other comprehensive income (loss) are as follows: Changes in Accumulated Other Comprehensive Income (Loss) by Component (a) Fiscal Year Ended January 2, 2016 Loss on Foreign Total Beginning Balance at January 3, 2015 $ (21,856 ) 1,906 $ (19,950 ) Other comprehensive loss before reclassifications, net of tax (16,371 ) (16,973 ) (33,344 ) Amounts reclassified from accumulated other comprehensive loss, net of tax (b) 15,092 0 15,092 Net current period other comprehensive loss including noncontrolling interest (1,279 ) (16,973 ) (18,252 ) Less: net current period other comprehensive loss attributable to the noncontrolling interest 0 937 937 Ending Balance at January 2, 2016 $ (23,135 ) $ (14,130 ) $ (37,265 ) (a) Amounts in parentheses indicate debits (b) See separate table below for details about these reclassifications Fiscal Year Ended January 3, 2015 Loss on Foreign Total Beginning Balance at December 28, 2013 $ (4,603 ) $ 13,120 $ 8,517 Other comprehensive loss before reclassifications, net of tax (29,340 ) (11,692 ) (41,032 ) Amounts reclassified from accumulated other comprehensive income, net of tax (b) 12,087 0 12,087 Net current period other comprehensive loss including noncontrolling interest (17,253 ) (11,692 ) (28,945 ) Less: net current period other comprehensive loss attributable to the noncontrolling interest 0 478 478 Ending Balance at January 3, 2015 $ (21,856 ) $ 1,906 $ (19,950 ) (a) Amounts in parentheses indicate debits (b) See separate table below for details about these reclassifications Fiscal Year Ended December 28, 2013 Loss on Foreign Total Beginning Balance at December 29, 2012 $ (6,602 ) $ 19,461 $ 12,859 Other comprehensive loss before reclassifications, net of tax (4,124 ) (6,341 ) (10,465 ) Amounts reclassified from accumulated other comprehensive income, net of tax (b) 6,123 0 6,123 Net current period other comprehensive loss including noncontrolling interest 1,999 (6,341 ) (4,342 ) Ending Balance at December 28, 2013 $ (4,603 ) $ 13,120 $ 8,517 (a) Amounts in parentheses indicate debits (b) See separate table below for details about these reclassifications Reclassifications out of Accumulated Other Comprehensive Income (Loss) (a) Fiscal Year Ended January 2, January 3, December 28, Details about Other Comprehensive Income Components Amounts Reclassified from Comprehensive Loss Affected Line Item in the Loss on Qualifying Hedges Interest rate contracts $ (24,741 ) $ (19,815 ) $ (10,037 ) Interest expense (24,741 ) (19,815 ) (10,037 ) Income before income taxes 9,649 7,728 3,914 Provision for income taxes $ (15,092 ) $ (12,087 ) $ (6,123 ) Net income (a) Amounts in parentheses indicate debits to profit / loss |
Restructuring Charges
Restructuring Charges | 12 Months Ended |
Jan. 02, 2016 | |
Restructuring Charges | 19. Restructuring Charges As previously disclosed, the Company established a new cost-savings initiative and, as part of this cost-savings initiative, in fiscal 2015, the Company undertook a plan of reduction in force which resulted in the elimination of certain positions and termination of employment for certain employees worldwide. In fiscal 2014, the Company reviewed its organization and undertook a restructuring which resulted in the elimination of certain positions and the termination of employment for certain employees worldwide. In connection with these plans, the Company recorded restructuring charges in connection with employee termination benefit costs of $8,412 ($5,131 after tax) and $11,840 ($7,222 after tax) during the fiscal years ended January 2, 2016 and January 3, 2015, respectively. For the fiscal years ended January 2, 2016 and January 3, 2015, these charges impacted cost of revenues by $1,505 and $4,642, respectively, and selling, general and administrative expenses by $6,907 and $7,198, respectively. For the fiscal years ended January 2, 2016 and January 3, 2015, all restructuring charges were recorded to general corporate expense and therefore there was no impact to the segments. For the fiscal year ended January 2, 2016, the reconciliation of the liability balance for these restructuring charges was as follows: Balance as of January 3, 2015 $ 2,570 Provision 8,412 Payments (9,173 ) Balance as of January 2, 2016 $ 1,809 The Company expects the $1,809 liability as of January 2, 2016 to be paid in fiscal 2016. |
Recently Issued Accounting Pron
Recently Issued Accounting Pronouncements | 12 Months Ended |
Jan. 02, 2016 | |
Recently Issued Accounting Pronouncements | 20. Recently Issued Accounting Pronouncements In May 2014, the Financial Accounting Standards Board (“FASB”) issued updated guidance on accounting for revenue from contracts with customers. The objective of this guidance is to provide a single, comprehensive revenue recognition model, to remove existing industry specific guidance and to expand qualitative and quantitative disclosures. The core principle of the new standard is for revenue recognition to depict transfer of control to the customer in an amount that reflects consideration to which an entity expects to be entitled. This guidance is effective for fiscal years beginning after December 15, 2017, and interim periods within those fiscal years, with early adoption not permitted. The Company is currently evaluating the impact that the adoption of this guidance will have on the consolidated financial position, results of operations or cash flows of the Company. In August 2014, the FASB issued updated guidance on the disclosure of uncertainties about an entity’s ability to continue as a going concern. The update provides guidance about management’s responsibility to evaluate whether there is substantial doubt about an entity’s ability to continue as a going concern and to provide related footnote disclosures. In doing so, the amendments should reduce diversity in the timing and content of footnote disclosures. This guidance is effective for the annual period ending after December 15, 2016, and for annual periods and interim periods thereafter, with early adoption permitted. The Company is currently evaluating the impact that the adoption of this guidance will have on the Company. In February 2015, the FASB issued amendments to the current consolidation guidance. The amendments affect both the variable interest entity and voting interest entity consolidation models. The new guidance is effective for the Company beginning January 1, 2016, with early adoption permitted. The adoption of this guidance will not have a material effect on the Company. In April 2015, the FASB issued updated guidance to simplify the presentation of debt issuance costs. The amendments in this update require that debt issuance costs related to a recognized debt liability be presented in the balance sheet as a direct deduction from the carrying amount of that debt liability, consistent with debt discounts. In August 2015, the FASB issued updated guidance which clarifies the treatment of debt issuance costs from line-of-credit arrangements. In particular, this guidance clarifies that the Securities and Exchange Commission Staff would not object to an entity deferring and presenting debt issuance costs related to a line-of-credit arrangement as an asset and subsequently amortizing the deferred debt issuance costs ratably over the term of such arrangement, regardless of whether there are any outstanding borrowings on the line-of-credit arrangement. This guidance is effective for fiscal years beginning after December 15, 2015 and interim periods within those fiscal years, and should be applied on a retrospective basis with earlier adoption permitted for financial statements that have not been previously issued. The Company does not expect the adoption to have a material impact on the financial statements. In July 2015, the FASB issued updated guidance to simplify the measurement of inventory. Under this amendment, an entity using an inventory method other than last-in, first out or the retail inventory method should measure inventory at the lower of cost and net realizable value. The new guidance clarifies that net realizable value is the estimated selling prices in the ordinary course of business, less reasonably predictable costs of completion, disposal, and transportation. This guidance is effective for fiscal years beginning after December 15, 2016, including interim periods within those fiscal years, and should be applied prospectively with earlier adoption permitted as of the beginning of the interim or annual reporting period. The Company is currently evaluating the impact that the adoption of this guidance will have on the consolidated financial position of the Company. In September 2015, the FASB issued updated guidance to simplify the accounting for adjustments made to provisional amounts recognized in a business combination, eliminating the requirement to retrospectively account for those adjustments. This guidance is effective for fiscal years beginning after December 15, 2015, including interim periods within those fiscal years, and should be applied prospectively with earlier adoption permitted as of the beginning of the interim or annual reporting period. There is no impact on the consolidated financial position, results of operations or cash flows of the Company as a result of this guidance. In November 2015, the FASB issued updated guidance that in a classified statement of financial position, an entity shall classify deferred tax assets and liabilities as noncurrent amounts. This guidance is effective for fiscal years beginning after December 15, 2016, including interim periods within those fiscal years and earlier adoption is permitted. The Company does not expect the adoption to have a material impact on the financial statements. |
Related Party
Related Party | 12 Months Ended |
Jan. 02, 2016 | |
Related Party | 21. Related Party As more fully described in Note 3, on October 18, 2015, the Company entered into the Strategic Collaboration Agreement with Ms. Winfrey, under which she will consult with the Company and participate in developing, planning, executing and enhancing the Weight Watchers program and related initiatives, and provide it with services in her discretion to promote the Company and its programs, products and services. In addition to the Strategic Collaboration Agreement, Ms. Winfrey and her related entities provided services to the Company totaling $647 for the fiscal year ended January 2, 2016, which services included advertising, production and related fees. The Company’s accounts payable to parties related to Ms. Winfrey at January 2, 2016 was $574. |
Quarterly Financial Information
Quarterly Financial Information (Unaudited) | 12 Months Ended |
Jan. 02, 2016 | |
Quarterly Financial Information (Unaudited) | 22. Quarterly Financial Information (Unaudited) The following is a summary of the unaudited quarterly consolidated results of operations for the fiscal years ended January 2, 2016 and January 3, 2015. For the Fiscal Quarters Ended April 4, July 4, October 3, January 2, Fiscal year ended January 2, 2016 Revenues, net $ 322,103 $ 309,754 $ 273,324 $ 259,238 Gross profit 157,303 159,364 136,622 120,798 Operating income 18,044 70,580 63,108 16,326 Net (loss) income attributable to the Company (5,433 ) 27,877 21,790 (11,309 ) Basic earnings per share $ (0.10 ) $ 0.49 $ 0.38 $ (0.18 ) Diluted earnings per share $ (0.10 ) $ 0.49 $ 0.38 $ (0.18 ) For the Fiscal Quarters Ended March 29, June 28, September January 3, Fiscal year ended January 3, 2015 Revenues, net Gross profit $ 409,358 222,900 $ 397,547 225,814 $ 345,184 187,567 $ 327,827 166,270 Operating income 51,053 114,564 91,394 42,303 Net income attributable to the Company 21,531 54,002 37,892 4,362 Basic earnings per share $ 0.38 $ 0.95 $ 0.67 $ 0.08 Diluted earnings per share $ 0.38 $ 0.95 $ 0.67 $ 0.08 Basic and diluted EPS are computed independently for each of the periods presented. Accordingly, the sum of the quarterly EPS amounts may not agree to the total for the year. As discussed in further detail in Note 19, the Company recorded restructuring charges of $5,761 ($3,514 after tax), $232 ($142 after tax), $1,081 ($660 after tax) and $1,338 ($815 after tax) during the first, second, third and fourth quarters of fiscal 2015, respectively, in connection with employee termination benefit costs associated with its previously disclosed cost-savings initiative plan to restructure its organization, reducing gross profit, operating income, net income attributable to the Company and to EPS all four quarters of fiscal 2015. The Company recorded restructuring charges of $3,656 ($2,235 after tax), $6,498 ($3,964 after tax), $713 ($430 after tax) and $973 ($593 after tax) during the first, second, third and fourth quarters of fiscal 2014, respectively, in connection with employee termination benefit costs associated with its previously disclosed cost-savings initiative plan to restructure its organization, reducing gross profit, operating income, net income attributable to the Company and EPS all four quarters of fiscal 2014. As discussed in further detail in Note 3, operating income, net income and EPS during the fourth quarter of fiscal 2015 were impacted by the Company recording expenses of $13,593 ($8,292 after tax and $0.13 per fully diluted share) in connection with the Winfrey Transaction in the fourth quarter of fiscal 2015. As discussed in further detail in Note 7, net income and EPS were impacted by a gain on the early extinguishment of debt of $4,749 ($2,897 after tax), and $6,727 ($4,103 after tax), or $0.05 and $0.07 per fully diluted share, during the first and second quarters of fiscal 2015, respectively. As discussed in Note 1, the Company identified and recorded out-of-period adjustments related to immaterial errors in prior period financial statements that impacted net income attributable to the Company by $420 and $410 for the second and fourth quarter of fiscal 2015, respectively. As discussed in further detail in Note 4, in the first quarter of fiscal 2014, net income and EPS were impacted by a gain of $10,540 ($6,396 after tax), or $0.11 per fully diluted share, recognized in connection with the Brazil acquisition due to an adjustment of the Company’s previously held equity interest to fair value offset by a charge associated with the settlement of the royalty-free arrangement of the Brazilian partnership. In the second quarter of fiscal 2014, net income and EPS were impacted by a $2,350, or $0.04 per fully diluted share, net tax benefit related to an intercompany loan write-off in connection with the closure of our China business partially offset by the recognition of a valuation allowance related to tax benefits for foreign losses that are not expected to be realized. |
VALUATION AND QUALIFYING ACCOUN
VALUATION AND QUALIFYING ACCOUNTS AND RESERVES | 12 Months Ended |
Jan. 02, 2016 | |
VALUATION AND QUALIFYING ACCOUNTS AND RESERVES | (IN THOUSANDS) Additions Balance at Charged to Charged Deductions (1) Balance at FISCAL YEAR ENDED JANUARY 2, 2016 Allowance for doubtful accounts $ 3,287 $ (446 ) $ 0 $ (615 ) $ 2,226 Inventory and other reserves $ 7,107 $ 7,593 $ 0 $ (10,635 ) $ 4,065 Tax valuation allowance $ 34,640 $ 1,056 $ (2,631 ) $ (4,785 ) $ 28,280 FISCAL YEAR ENDED JANUARY 3, 2015 Allowance for doubtful accounts $ 3,477 $ 99 $ 0 $ (289 ) $ 3,287 Inventory and other reserves $ 5,859 $ 11,822 $ 0 $ (10,574 ) $ 7,107 Tax valuation allowance $ 36,372 $ 3,183 $ 0 $ (4,915 ) $ 34,640 FISCAL YEAR ENDED DECEMBER 28, 2013 Allowance for doubtful accounts $ 3,447 $ 596 $ 0 $ (566 ) $ 3,477 Inventory and other reserves $ 6,942 $ 9,580 $ 0 $ (10,663 ) $ 5,859 Tax valuation allowance $ 31,015 $ 3,821 $ 2,429 $ (893 ) $ 36,372 (1) Primarily represents the utilization of established reserves, net of recoveries, where applicable. |
Summary of Significant Accoun31
Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Jan. 02, 2016 | |
Fiscal Year | Fiscal Year: The Company’s fiscal year ends on the Saturday closest to December 31 st and consists of either 52 or 53-week |
Use of Estimates | Use of Estimates: The preparation of financial statements, in conformity with GAAP, requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting period. On an ongoing basis, the Company evaluates its estimates and judgments, including those related to inventories, the impairment analysis for goodwill and other indefinite-lived intangible assets, share-based compensation, income taxes, tax contingencies and litigation. The Company bases its estimates on historical experience and on various other factors and assumptions that it believes to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual amounts could differ from these estimates. |
Translation of Foreign Currencies | Translation of Foreign Currencies: For all foreign operations, the functional currency is the local currency. Assets and liabilities of these operations are translated into US dollars using the exchange rate in effect at the end of each reporting period. Income statement accounts are translated at the average rate of exchange prevailing during each reporting period. Translation adjustments arising from the use of differing exchange rates from period to period are included in accumulated other comprehensive income (loss). Foreign currency gains and losses arising from the translation of intercompany receivables and intercompany payables with the Company’s international subsidiaries are recorded as a component of other expense (income), net, unless the receivable is considered long-term in nature, in which case the foreign currency gains and losses are recorded as a component of accumulated other comprehensive income (loss). |
Cash Equivalents | Cash Equivalents: Cash and cash equivalents are defined as highly liquid investments with original maturities of three months or less. Cash balances may, at times, exceed insurable amounts. The Company believes it mitigates this risk by investing in or through major financial institutions. Cash includes balances due from third-party credit card companies. |
Inventories | Inventories: Inventories, which consist of finished goods, are stated at the lower of cost or market on a first-in, first-out basis, net of reserves for obsolescence and shrinkage. |
Property and Equipment | Property and Equipment: Property and equipment are recorded at cost. For financial reporting purposes, equipment is depreciated on the straight-line method over the estimated useful lives of the assets (3 to 10 years). Leasehold improvements are amortized on the straight-line method over the shorter of the term of the lease or the useful life of the related assets. Expenditures for new facilities and improvements that substantially extend the useful life of an asset are capitalized. Ordinary repairs and maintenance are expensed as incurred. When assets are retired or otherwise disposed of, the cost and related depreciation are removed from the accounts and any related gains or losses are included in income. |
Impairment of Long Lived Assets | Impairment of Long Lived Assets: The Company reviews long-lived assets, including amortizable intangible assets, for impairment whenever events or changes in business circumstances indicate that the carrying amount of the assets may not be fully recoverable. In fiscal 2015, the Company recorded an impairment charge of $2,028 related to internal-use computer software that was not expected to provide substantive service potential. In fiscal 2015 and fiscal 2014, the Company recorded impairment charges of $427 and $652, respectively, related to property, plant and equipment that were expected to be disposed of before the end of their estimated useful lives. In fiscal 2013, the Company commenced the shutdown of its China operations and, as a result, recorded an impairment charge of $1,607 related to property, plant and equipment ($372) and amortizable intangible assets ($1,235). The Company also recorded an impairment charge of $2,653 in fiscal 2013 related to internal-use computer software that was not expected to provide substantive service potential. |
Goodwill and Franchise Rights Acquired and Other Intangible Assets | Goodwill and Franchise Rights Acquired and Other Intangible Assets: Finite-lived intangible assets are amortized using the straight-line method over their estimated useful lives of 3 to 20 years or, in the case of amortizable franchise rights acquired, over the remaining contractual period, which is generally less than one year. The Company reviews goodwill and other indefinite-lived intangible assets, including franchise rights acquired with indefinite lives, for potential impairment on at least an annual basis or more often if events so require. The Company performed fair value impairment testing as of the end of fiscal 2015 and fiscal 2014 on its goodwill and other indefinite-lived intangible assets. In performing the impairment analysis for the fiscal year ended January 2, 2016 and for the fiscal year ended January 3, 2015, the Company determined that the carrying amounts of its franchise rights acquired with indefinite lives did not exceed their respective fair values and therefore, no impairment existed. In performing the impairment analysis for the fiscal year ended December 28, 2013, the Company determined that, based on the fair values calculated, the carrying amounts of the indefinite-lived franchise rights acquired related to its Mexico and Hong Kong operations exceeded their respective fair values and recorded impairment charges of $935 and $231, respectively. The Company determined that the carrying amounts of the remainder of its franchise rights acquired with indefinite lives did not exceed their respective fair values as of the end of fiscal 2013, and therefore, no other impairment existed. When determining fair value, the Company utilizes various assumptions, including projections of future cash flows, growth rates and discount rates. A change in these underlying assumptions will cause a change in the results of the tests and, as such, could cause fair value to be less than the carrying amounts and result in an impairment of those assets. In the event such a result occurred, the Company would be required to record a corresponding charge, which would impact earnings. The Company would also be required to reduce the carrying amounts of the related assets on its balance sheet. The Company continues to evaluate these estimates and assumptions and believes that these assumptions are appropriate. The following is a discussion of the goodwill and franchise rights acquired impairment analysis. Goodwill In performing the impairment analysis for goodwill, the fair value for the Company’s reporting units is estimated using a discounted cash flow approach. This approach involves projecting future cash flows attributable to the reporting unit and discounting those estimated cash flows using an appropriate discount rate. The estimated fair value is then compared to the carrying value of the reporting unit. The Company has determined the appropriate reporting unit for purposes of assessing annual impairment to be the country for all reporting units. To date, the Company has not recorded an impairment of goodwill. For all of the Company’s reporting units except for Brazil (see below), the Company estimated future cash flows by utilizing the historical debt-free cash flows attributable to that country and then applied expected future operating income growth rates for such country. The Company utilized operating income as the basis for measuring its potential growth because it believes it is the best indicator of the performance of its business. The Company then discounted the estimated future cash flows utilizing a discount rate which was calculated using the average cost of capital, which included the cost of equity and the cost of debt. The cost of equity was determined by combining a risk-free rate of return and a market risk premium for the Company’s peer group. The risk-free rate of return was generally determined based on the average rate of long-term U.S. Treasury securities. The market risk premium was generally determined by reviewing external market data. The cost of debt was determined by estimating the Company’s current borrowing rate. As it relates to the impairment analysis for Brazil, the Company estimated future debt-free cash flows in contemplation of its growth strategies for that market. In developing these projections, the Company considered the historical impact of similar growth strategies in other markets as well as the current market conditions in Brazil. The Company then discounted the estimated future cash flows utilizing a discount rate which was calculated using the average cost of capital, which included the cost of equity and the cost of debt. The cost of equity was determined by combining a risk-free rate of return and a market risk premium for the Company’s peer group. The risk-free rate of return was generally determined based on the average rate of long-term U.S. Treasury securities. The market risk premium was generally determined by reviewing external market data. Additional consideration was given to the current economic conditions in Brazil and country specific risk as well as the rate of growth projected in the analysis. The cost of debt was determined by estimating the Company’s current borrowing rate. Franchise Rights Acquired In performing the impairment analysis for indefinite-lived franchise rights acquired, the fair value for franchise rights acquired is estimated using a discounted cash flow approach referred to as the hypothetical start-up approach for franchise rights related to the Company’s meetings business and a relief from royalty methodology for franchise rights related to the Company’s Online business. The aggregate estimated fair value for these rights is then compared to the carrying value of the unit of accounting for those franchise rights. The Company has determined the appropriate unit of account for purposes of assessing annual impairment to be the combination of the rights in the meetings and Online businesses in the country in which the acquisitions have occurred. The values of these franchise rights in the United States, Canada, United Kingdom, Australia, New Zealand and other countries at January 2, 2016 were $675,515, $48,435, $11,858, $6,563, $4,833, and $122, respectively, totaling $747,326 and the values at January 3, 2015 were $675,515, $57,579, $13,138, $7,272, $5,449 and $1,930, respectively, totaling $760,883. The Company estimated future cash flows for each unit of accounting by utilizing a hypothetical start-up approach in which it assumed that the year of maturity was reached after 7 years. Subsequent to the year of maturity, the Company assumed debt-free cash flow growth rates based on its expected future operating income growth rates for such country. The Company utilized operating income as the basis for measuring its potential growth because it believes it is the best indicator of the performance of its business. The Company then discounted the estimated future cash flows utilizing discount rates consistent with those used in its goodwill impairment analysis as discussed above. Other Intangible Assets The Company expenses all software costs (including website development costs) incurred during the preliminary project stage and capitalizes all internal and external direct costs of materials and services consumed in developing software (including website development costs) once the development has reached the application development stage. Application development stage costs generally include software configuration, coding, installation to hardware and testing. These costs are amortized over their estimated useful life of 3 years for website development costs and from 3 to 5 years for all other software costs. All costs incurred for upgrades, maintenance and enhancements, including the cost of website content, which do not result in additional functionality, are expensed as incurred. |
Revenue Recognition | Revenue Recognition: WWI earns revenue by conducting meetings, for which it charges a fee, predominantly through monthly commitment plans, prepayment plans or the “pay-as-you-go” arrangement. WWI also earns revenue from monthly subscriptions for its Online products, selling products in its meetings, on the Internet and to its franchisees, collecting commissions from franchisees, collecting royalties related to licensing agreements, selling magazine subscriptions, selling advertising space on its website and in copies of its magazines, ecommerce fees and By Mail product sales. Monthly commitment plans, prepaid meeting fees and magazine subscription revenue is recorded to deferred revenue and amortized into revenue over the period earned. Online Subscription Revenues, consisting of the fees associated with subscriptions for the Company’s Online subscription products, including its Personal Coaching product, are recognized over the period that products are provided. One-time sign-up fees are deferred and recognized over the expected customer relationship period. Online Subscription Revenues that are paid in advance are deferred and recognized on a straight-line basis over the subscription period. Revenue from “pay-as-you-go” meeting fees, product sales, ecommerce fees, By Mail, commissions and royalties is recognized when services are rendered, products are shipped to customers and title and risk of loss pass to the customers, and commissions and royalties are earned, respectively. Revenue from advertising in magazines is recognized when advertisements are published. Revenue from magazine sales is recognized when the magazine is sent to the customer. In the meetings business, WWI generally charges non-refundable registration and starter fees in exchange for an introductory information session and materials it provides to new members. Revenue from these registration and starter fees is recognized when the service and products are provided, which is generally at the same time payment is received from the customer. Discounts to customers, including free registration offers, are recorded as a deduction from gross revenue in the period such revenue was recognized. Revenue from advertising on its website is recognized when the advertisement is viewed by the user. The Company grants refunds in aggregate amounts that historically have not been material. Because the period of payment of the refund generally approximates the period revenue was originally recognized, refunds are recorded as a reduction of revenue when paid. |
Advertising Costs | Advertising Costs: Advertising costs consist primarily of television and digital media. All costs related to advertising are expensed in the period incurred, except for media production-related costs, which are expensed the first time the advertising takes place. Total advertising expenses for the fiscal years ended January 2, 2016, January 3, 2015 and December 28, 2013 were $191,060, $251,954, and $285,298, respectively. |
Income Taxes | Income Taxes: Deferred income tax assets and liabilities result primarily from temporary differences between the financial statement and tax bases of assets and liabilities, using enacted tax rates in effect for the year in which differences are expected to reverse. If it is more-likely-than-not that some portion of a deferred tax asset will not be realized, a valuation allowance is recognized. The Company considers historic levels of income, estimates of future taxable income and feasible tax planning strategies in assessing the need for a tax valuation allowance. The Company recognizes a benefit for uncertain tax positions when a tax position taken or expected to be taken in a tax return is more-likely-than-not to be sustained upon examination by taxing authorities. The amount recognized is measured as the largest amount of benefit that is greater than 50% likely of being realized upon ultimate settlement. The Company recognizes accrued interest and penalties associated with uncertain tax positions as part of the provision for income taxes on its consolidated statements of income. In addition, assets and liabilities acquired in purchase business combinations are assigned their fair values and deferred taxes are provided for lower or higher tax bases. |
Derivative Instruments and Hedging | Derivative Instruments and Hedging: The Company is exposed to certain risks related to its ongoing business operations, primarily interest rate risk and foreign currency risk. The primary risk managed by using derivative instruments is interest rate risk. Interest rate swaps are entered into to hedge a portion of the cash flow exposure associated with the Company’s variable-rate borrowings. The Company does not use any derivative instruments for trading or speculative purposes. The Company recognizes the fair value of all derivative instruments as either assets or liabilities on the balance sheet. The Company has designated and accounted for interest rate swaps as cash flow hedges of its variable-rate borrowings. For derivative instruments that are designated and qualify as cash flow hedges, the effective portion of the gain or loss on the derivative is reported as a component of accumulated other comprehensive income (loss) and reclassified into earnings in the periods during which the hedged transactions affect earnings. Gains and losses on the derivative representing either hedge ineffectiveness or hedge components excluded from the assessment of effectiveness are recognized in current earnings. The fair value of the Company’s interest rate swaps is reported in derivative payable and prepaid expenses and other current assets on its balance sheet. See Note 16 for a further discussion regarding the fair value of the Company’s interest rate swaps. The net effect of the interest payable and receivable under the Company’s interest rate swaps is included in interest expense on the statement of income. |
Deferred Financing Costs | Deferred Financing Costs: Deferred financing costs consist of fees paid by the Company as part of the establishment, exchange and/or modification of the Company’s long-term debt. During the fiscal year ended January 2, 2016, in connection with the prepayment of debt, the Company wrote-off deferred financing fees of approximately $647, recorded a gain on early extinguishment of debt totaling $11,426, and incurred additional fees of approximately $1,241. During the fiscal year ended January 3, 2015, the Company wrote-off deferred financing fees of approximately $1,583 in connection with amending its Credit Agreement (as defined in Note 7). During the fiscal year ended December 28, 2013, the Company incurred fees of $44,817 associated with the refinancing of the WWI Credit Facility (as defined in Note 7). The Company wrote-off fees in connection with this refinancing which resulted in the Company recording a charge of $21,685 in early extinguishment of debt. Amortization expense for the fiscal years ended January 2, 2016, January 3, 2015 and December 28, 2013 was $6,886, $9,305 and $7,672, respectively. |
Accumulated Other Comprehensive Loss | Accumulated Other Comprehensive Loss: The Company’s accumulated other comprehensive loss includes net income, changes in the fair value of derivative instruments and the effects of foreign currency translations. At January 2, 2016, January 3, 2015 and December 28, 2013 the cumulative balance of changes in fair value of derivative instruments, net of taxes, was $(23,135), $(21,856) and $(4,603), respectively. At January 2, 2016, January 3, 2015 and December 28, 2013, the cumulative balance of the effects of foreign currency translations, net of taxes, was $(14,130) and $1,906 and $13,120, respectively. |
Restructuring Expense | Restructuring Expense: The Company records estimated expense for restructuring initiatives when such costs are deemed probable and estimable, when approved by the appropriate corporate authority and by accumulating detailed estimates of costs for such plans. These expenses include the estimated costs of employee severance and related benefits, impairment or accelerated depreciation of property, plant and equipment and capitalized software, and any other qualifying exit costs. Such costs represent the Company’s best estimate, but require assumptions about the plans that may change over time, including attrition rates. Estimates are evaluated periodically to determine whether an adjustment is required. |
Reclassification | Reclassification: Certain prior year amounts have been reclassified to conform to the current year presentation. |
Acquisitions and Shutdown of 32
Acquisitions and Shutdown of China Operations (Tables) | 12 Months Ended |
Jan. 02, 2016 | |
Schedule of Net Purchase Price of the Acquisition | The net purchase price of the Brazil acquisition has been allocated as follows: Fair value of consideration transferred: Net purchase price $ 14,181 Less cash acquired 2,262 Total 11,919 Gain on acquisition 10,540 Redeemable noncontrolling interest 6,157 28,616 Identifiable assets acquired and liabilities assumed: Franchise rights acquired 2,000 Receivables 1,139 Fixed assets 575 Prepaid expenses 421 Inventory 287 Customer relationship value 275 Other assets 199 Accrued liabilities (1,063 ) Deferred tax on acquired intangibles (680 ) Deferred revenue (445 ) Income taxes payable (258 ) Accounts payable (91 ) Total identifiable net assets 2,359 Goodwill $ 26,257 |
Franchise Rights Acquired, Go33
Franchise Rights Acquired, Goodwill and Other Intangible Assets (Tables) | 12 Months Ended |
Jan. 02, 2016 | |
Changes in Carrying Values of Goodwill | For the fiscal year ended January 2, 2016, the change in the carrying amount of goodwill is due to the Weilos acquisition and the effect of exchange rate changes as follows: North America UK CE Other Total Balance as of January 3, 2015 $ 134,611 $ 1,421 $ 7,661 $ 24,586 $ 168,279 Goodwill acquired during the period 5,588 0 0 0 5,588 Effect of exchange rate changes (6,791 ) (51 ) (401 ) (7,293 ) (14,536 ) Balance as of January 2, 2016 $ 133,408 $ 1,370 $ 7,260 $ 17,293 $ 159,331 |
Schedule of Finite-Lived Intangible Assets by Major Class | The carrying values of finite-lived intangible assets as of January 2, 2016 and January 3, 2015 were as follows: January 2, 2016 January 3, 2015 Gross Accumulated Gross Accumulated Capitalized software costs $ 119,658 86,134 $ 107,581 $ 72,590 Website development costs 100,105 68,673 95,717 63,405 Trademarks 10,960 10,435 10,836 10,213 Other 7,976 7,118 7,014 6,825 Trademarks and other intangible assets $ 238,699 $ 172,360 $ 221,148 $ 153,033 Franchise rights acquired 4,182 4,059 4,735 3,690 Total finite-lived intangible assets $ 242,881 $ 176,419 $ 225,883 $ 156,723 |
Schedule of Expected Amortization Expense | Estimated amortization expense of existing finite-lived intangible assets for the next five fiscal years and thereafter is as follows: 2016 $ 32,094 2017 $ 24,726 2018 $ 8,451 2019 $ 1,125 2020 and thereafter $ 66 |
Property and Equipment (Tables)
Property and Equipment (Tables) | 12 Months Ended |
Jan. 02, 2016 | |
Property, Plant and Equipment | The components of property and equipment were: January 2, January 3, Equipment $ 122,789 $ 124,788 Leasehold improvements 79,115 79,496 201,904 204,284 Less: Accumulated depreciation and amortization (143,718 ) (129,634 ) $ 58,186 $ 74,650 |
Long-Term Debt (Tables)
Long-Term Debt (Tables) | 12 Months Ended |
Jan. 02, 2016 | |
Schedule of Long-term Debt Instruments | The components of the Company’s long-term debt were as follows: January 2, 2016 January 3, 2015 Balance Effective Balance Effective Revolving Facility due April 2, 2018 $ 48,000 2.75 % $ 0 0.00 % Tranche B-1 Term Facility due April 2, 2016 144,323 3.19 % 294,750 3.12 % Tranche B-2 Term Facility due April 2, 2020 2,042,250 4.00 % 2,063,250 3.96 % Total Debt 2,234,573 3.98 % 2,358,000 3.86 % Less Current Portion 213,323 80,728 Total Long-Term Debt $ 2,021,250 $ 2,277,272 |
Schedule of Maturities of Long-term Debt | At January 2, 2016, the aggregate amounts of the Company’s existing long-term debt maturing in each of the next five fiscal years were as follows: 2016 $ 213,323 2017 21,000 2018 21,000 2019 21,000 2020 1,958,250 $ 2,234,573 |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 12 Months Ended |
Jan. 02, 2016 | |
Schedule of EPS, Basic and Diluted | The following table sets forth the computation of basic and diluted EPS for the fiscal years ended: January 2, January 3, December 28, Numerator: Net income attributable to Weight Watchers International, Inc. $ 32,945 $ 117,787 $ 202,742 Denominator: Weighted average shares of common stock outstanding 58,369 56,607 56,144 Effect of dilutive common stock equivalents 597 98 250 Weighted average diluted common shares outstanding 58,966 56,705 56,394 Earnings Per Share attributable to Weight Watchers International, Inc. Basic $ 0.56 $ 2.08 $ 3.61 Diluted $ 0.56 $ 2.08 $ 3.60 |
Stock Plans (Tables)
Stock Plans (Tables) | 12 Months Ended |
Jan. 02, 2016 | |
Schedule of Share-based Payment Award, Stock Options, Valuation Assumptions | The fair value of each of these option awards is estimated on the date of grant using the Black-Scholes option pricing model with the weighted average assumptions noted in the following table. Expected volatility is based on the historical volatility of the Company’s stock. Since the Company’s option exercise history is limited, it has estimated the expected term of these option grants to be the midpoint between the vesting period and the contractual term of each award. The risk free interest rate is based on the U.S. Treasury yield curve in effect on the date of grant which most closely corresponds to the expected term of the Time Vesting Options. The dividend yield is based on our historic average dividend yield. The Company did not grant any Time Vesting Options in fiscal 2014. January 2, 2016 January 3, December 28, Dividend yield 0.0% 0.0% 0.8% Volatility 41.0% 0.0% 36.5% Risk-free interest rate 1.84% - 1.89% 0% - 0% 1.3% - 2.2% Expected term (years) 6.0 0.0 6.5 |
Schedule of Share-based Compensation, Stock Options, Activity | A summary of all option activity under the Stock Plans and the Winfrey Option (see Note 3 for additional disclosure regarding the Winfrey Option) for the year ended January 2, 2016 is presented below: Shares Weighted- Weighted- Aggregate Outstanding at January 3, 2015 3,250 $ 30.72 Granted 4,572 6.61 Exercised (4 ) 22.67 Exchanged (1,700 ) 24.68 Cancelled (788 ) 31.94 Outstanding at January 2, 2016 5,330 $ 11.79 9.2 $ 73,260 Exercisable at January 2, 2016 3,916 $ 10.62 9.3 $ 55,772 |
Schedule of Share-based Compensation, Restricted Stock Units Award Activity | A summary of RSU activity under the Stock Plans for the year ended January 2, 2016 is presented below: Shares Weighted-Average Fair Value Outstanding at January 3, 2015 838 $ 27.71 Granted 780 $ 5.55 Vested (35 ) $ 51.18 Forfeited (217 ) $ 26.25 Outstanding at January 2, 2016 1,366 $ 27.71 |
Special Performance Based Options Awards | |
Schedule of Share-based Payment Award, Stock Options, Valuation Assumptions | The expected term represents the period from the grant date to the end of the five year performance period. Compensation expense on T&P Vesting Options is recognized ratably over the three year required service period as this period is longer than the derived service period calculated by the Monte Carlo simulation. January 2, January 3, December 28, Dividend yield 0.0% 0.0% 0.0% Volatility 40.5% 37.8% 36.5% Risk-free interest rate 1.6% 1.4% - 1.8% 2% Expected term (years) 5.0 5.0 5.0 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Jan. 02, 2016 | |
Schedule of Components of Income Tax Expense (Benefit) | The following tables summarize the Company’s consolidated provision for US federal, state and foreign taxes on income: January 2, January 3, December 28, Current: US federal $ (6,862 ) $ 12,904 $ 60,030 State 1,859 (131 ) 9,583 Foreign 15,740 24,059 25,647 $ 10,737 $ 36,832 $ 95,260 Deferred: US federal $ 10,756 $ 25,162 $ 30,513 State 1,890 2,876 3,487 Foreign (548 ) 1,061 358 $ 12,098 $ 29,099 $ 34,358 Total tax provision $ 22,835 $ 65,931 $ 129,618 |
Schedule of Income before Income Tax, Domestic and Foreign | The components of the Company’s consolidated income before income taxes consist of the following: January 2, January 3, December 28, Domestic $ 6,299 $ 88,024 $ 248,637 Foreign 49,315 95,640 83,723 $ 55,614 $ 183,664 $ 332,360 |
Schedule of Effective Income Tax Rate Reconciliation | The difference between the US federal statutory tax rate and the Company’s consolidated effective tax rate is as follows: January 2, January 3, December 28, US federal statutory rate 35.0 % 35.0 % 35.0 % States income taxes (net of federal benefit) 3.8 1.3 2.7 Reserves for uncertain tax positions 3.5 0.4 (0.1 ) Foreign taxes (0.4 ) (0.6 ) 0.4 (Decrease) increase in valuation allowance (2.2 ) 1.7 0.9 Loss on closure of China 0.0 (2.1 ) 0.0 Other 1.4 0.2 0.1 Effective tax rate 41.1 % 35.9 % 39.0 % |
Schedule of Deferred Tax Assets and Liabilities | The deferred tax assets and liabilities recorded on the Company’s consolidated balance sheets are as follows: January 2, January 3, Provision for estimated expenses $ 4,638 $ 7,863 Depreciation 4,164 0 Operating loss carryforwards 34,285 37,746 Salaries and wages 641 9,567 Share-based compensation 14,330 6,653 Other 8,024 6,922 Other comprehensive income 24,778 13,060 Less: valuation allowance (28,279 ) (34,640 ) Total deferred tax assets $ 62,581 $ 47,171 Depreciation $ 0 $ (6,482 ) Other (1,823 ) (3,123 ) Amortization (210,901 ) (188,745 ) Total deferred tax liabilities $ (212,724 ) $ (198,350 ) Net deferred tax liabilities $ (150,143 ) $ (151,179 ) |
Reconciliation of Unrecognized Tax Benefits | A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows: January 2, January 3, December 28, Balance at beginning of year $ 6,268 $ 5,784 $ 5,319 Additions based on tax positions related to the current year 2,106 1,304 1,428 Reductions for tax positions of prior years (676 ) (820 ) (963 ) Balance at end of year $ 7,698 $ 6,268 $ 5,784 |
Cash Flow Information (Tables)
Cash Flow Information (Tables) | 12 Months Ended |
Jan. 02, 2016 | |
Schedule of Cash Flow, Supplemental Disclosures | January 2, January 3, December 28, Net cash paid during the year for: Interest expense $ 117,602 $ 123,100 $ 99,687 Income taxes $ 25,566 $ 35,232 $ 87,071 Noncash investing and financing activities were as follows: Fair value of net assets/(liabilities) acquired in connection with acquisitions $ 1,439 $ 359 $ (175 ) Change in Capital expenditures and Capitalized software included in accounts payable and accrued expenses $ (1,969 ) $ 3,347 $ (5,432 ) Dividends declared but not yet paid at year-end $ 0 $ 0 $ 177 |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 12 Months Ended |
Jan. 02, 2016 | |
Minimum Commitments Under Non-Cancelable Obligations | Minimum commitments under non-cancelable obligations, primarily for office and rental facilities operating leases at January 2, 2016, consist of the following: 2016 $ 46,086 2017 30,650 2018 20,214 2019 15,098 2020 12,093 2021 and thereafter 95,437 Total $ 219,578 |
Segment and Geographic Data (Ta
Segment and Geographic Data (Tables) | 12 Months Ended |
Jan. 02, 2016 | |
Information About Reportable Segments | Total Revenue for the Year Ended January 2, January 3, December 28, North America $ 755,396 $ 947,716 $ 1,163,002 United Kingdom 124,773 156,843 172,783 Continental Europe 229,147 298,878 299,403 Other 55,103 76,479 88,935 Total revenue $ 1,164,419 $ 1,479,916 $ 1,724,123 Net Income for the Year Ended January 2, January 3, December 28, Segment operating income: North America $ 140,579 $ 250,282 $ 403,104 United Kingdom 24,310 29,187 34,429 Continental Europe 62,364 79,282 66,273 Other 8,007 13,676 13,774 Total segment operating income 235,260 372,427 517,580 General corporate expenses (67,202 ) (73,113 ) (59,828 ) Interest expense 121,843 122,984 103,108 Other expense, net 2,027 3,206 599 Gain on Brazil acquisition 0 (10,540 ) 0 (Gain) loss on early extinguishment of debt (11,426 ) 0 21,685 Provision for taxes 22,835 65,931 129,618 Net income 32,779 117,733 202,742 Net income attributable to noncontrolling interest 166 54 — Net income attributable to Weight Watchers International, Inc. $ 32,945 $ 117,787 $ 202,742 Depreciation and Amortization for the Year Ended January 2, January 3, December 28, North America $ 47,128 $ 34,654 $ 35,928 United Kingdom 766 1,158 1,269 Continental Europe 1,861 2,356 2,222 Other 1,473 2,144 1,965 Total segment depreciation and amortization 51,228 40,312 41,384 General corporate depreciation and amortization 8,829 18,227 14,197 Depreciation and amortization $ 60,057 $ 58,539 $ 55,581 |
Schedule of Revenue from External Customers and Long-Lived Assets, by Geographical Areas | The following tables present information about the Company’s sources of revenue and other information by geographic area. There were no material amounts of sales or transfers among geographic areas and no material amounts of US export sales. Revenues for the Year Ended January 2, January 3, December 28, Meeting Fees $ 587,801 $ 744,560 $ 851,626 Online Subscription Revenues 349,567 437,385 509,135 In-meeting product sales 127,291 169,101 211,963 Licensing, franchise royalties and other 99,760 128,870 151,399 $ 1,164,419 $ 1,479,916 $ 1,724,123 Revenues for the Year Ended January 2, January 3, December 28, United States $ 700,972 $ 869,541 $ 1,067,200 Canada 54,277 78,175 95,802 United Kingdom 124,773 156,843 172,783 Continental Europe 229,147 298,878 299,403 Other 55,250 76,479 88,935 $ 1,164,419 $ 1,479,916 $ 1,724,123 Long-Lived Assets January 2, January 3, December 28, United States $ 51,103 $ 67,903 $ 79,448 Canada 2,757 3,149 3,070 United Kingdom 2,938 724 1,192 Continental Europe 614 1,454 2,083 Other 774 1,420 1,259 $ 58,186 $ 74,650 $ 87,052 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 12 Months Ended |
Jan. 02, 2016 | |
Fair Value, Assets Measured on Recurring Basis | The following table presents the aggregate fair value of the Company’s derivative financial instruments: Fair Value Measurements Using: Total Quoted Prices in Significant Other Significant Interest rate swap liability at January 2, 2016 $ 44,170 $ 0 $ 44,170 $ 0 Interest rate swap liability at January 3, 2015 $ 42,423 $ 0 $ 42,423 $ 0 |
Accumulated Other Comprehensi43
Accumulated Other Comprehensive Loss (Tables) | 12 Months Ended |
Jan. 02, 2016 | |
Changes in Accumulated Other Comprehensive Income (Loss) by Component | Changes in Accumulated Other Comprehensive Income (Loss) by Component (a) Fiscal Year Ended January 2, 2016 Loss on Foreign Total Beginning Balance at January 3, 2015 $ (21,856 ) 1,906 $ (19,950 ) Other comprehensive loss before reclassifications, net of tax (16,371 ) (16,973 ) (33,344 ) Amounts reclassified from accumulated other comprehensive loss, net of tax (b) 15,092 0 15,092 Net current period other comprehensive loss including noncontrolling interest (1,279 ) (16,973 ) (18,252 ) Less: net current period other comprehensive loss attributable to the noncontrolling interest 0 937 937 Ending Balance at January 2, 2016 $ (23,135 ) $ (14,130 ) $ (37,265 ) (a) Amounts in parentheses indicate debits (b) See separate table below for details about these reclassifications Fiscal Year Ended January 3, 2015 Loss on Foreign Total Beginning Balance at December 28, 2013 $ (4,603 ) $ 13,120 $ 8,517 Other comprehensive loss before reclassifications, net of tax (29,340 ) (11,692 ) (41,032 ) Amounts reclassified from accumulated other comprehensive income, net of tax (b) 12,087 0 12,087 Net current period other comprehensive loss including noncontrolling interest (17,253 ) (11,692 ) (28,945 ) Less: net current period other comprehensive loss attributable to the noncontrolling interest 0 478 478 Ending Balance at January 3, 2015 $ (21,856 ) $ 1,906 $ (19,950 ) (a) Amounts in parentheses indicate debits (b) See separate table below for details about these reclassifications Fiscal Year Ended December 28, 2013 Loss on Foreign Total Beginning Balance at December 29, 2012 $ (6,602 ) $ 19,461 $ 12,859 Other comprehensive loss before reclassifications, net of tax (4,124 ) (6,341 ) (10,465 ) Amounts reclassified from accumulated other comprehensive income, net of tax (b) 6,123 0 6,123 Net current period other comprehensive loss including noncontrolling interest 1,999 (6,341 ) (4,342 ) Ending Balance at December 28, 2013 $ (4,603 ) $ 13,120 $ 8,517 (a) Amounts in parentheses indicate debits (b) See separate table below for details about these reclassifications |
Reclassifications out of Accumulated Other Comprehensive Income (Loss) | Reclassifications out of Accumulated Other Comprehensive Income (Loss) (a) Fiscal Year Ended January 2, January 3, December 28, Details about Other Comprehensive Income Components Amounts Reclassified from Comprehensive Loss Affected Line Item in the Loss on Qualifying Hedges Interest rate contracts $ (24,741 ) $ (19,815 ) $ (10,037 ) Interest expense (24,741 ) (19,815 ) (10,037 ) Income before income taxes 9,649 7,728 3,914 Provision for income taxes $ (15,092 ) $ (12,087 ) $ (6,123 ) Net income (a) Amounts in parentheses indicate debits to profit / loss |
Restructuring Charges (Tables)
Restructuring Charges (Tables) | 12 Months Ended |
Jan. 02, 2016 | |
Reconciliation of Liability Balance for Restructuring Charges | For the fiscal year ended January 2, 2016, the reconciliation of the liability balance for these restructuring charges was as follows: Balance as of January 3, 2015 $ 2,570 Provision 8,412 Payments (9,173 ) Balance as of January 2, 2016 $ 1,809 |
Quarterly Financial Informati45
Quarterly Financial Information (Unaudited) (Tables) | 12 Months Ended |
Jan. 02, 2016 | |
Schedule of Quarterly Financial Information | The following is a summary of the unaudited quarterly consolidated results of operations for the fiscal years ended January 2, 2016 and January 3, 2015. For the Fiscal Quarters Ended April 4, July 4, October 3, January 2, Fiscal year ended January 2, 2016 Revenues, net $ 322,103 $ 309,754 $ 273,324 $ 259,238 Gross profit 157,303 159,364 136,622 120,798 Operating income 18,044 70,580 63,108 16,326 Net (loss) income attributable to the Company (5,433 ) 27,877 21,790 (11,309 ) Basic earnings per share $ (0.10 ) $ 0.49 $ 0.38 $ (0.18 ) Diluted earnings per share $ (0.10 ) $ 0.49 $ 0.38 $ (0.18 ) For the Fiscal Quarters Ended March 29, June 28, September January 3, Fiscal year ended January 3, 2015 Revenues, net Gross profit $ 409,358 222,900 $ 397,547 225,814 $ 345,184 187,567 $ 327,827 166,270 Operating income 51,053 114,564 91,394 42,303 Net income attributable to the Company 21,531 54,002 37,892 4,362 Basic earnings per share $ 0.38 $ 0.95 $ 0.67 $ 0.08 Diluted earnings per share $ 0.38 $ 0.95 $ 0.67 $ 0.08 |
Basis of Presentation - Additio
Basis of Presentation - Additional Information (Detail) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||
Jan. 02, 2016 | Jul. 04, 2015 | Jan. 02, 2016 | Jan. 03, 2015 | Dec. 28, 2013 | |
Disclosure Basis Of Presentation Details [Line Items] | |||||
Income before income taxes | $ 55,614 | $ 183,664 | $ 332,360 | ||
Net income attributable to Weight Watchers International, Inc. | 32,945 | 117,787 | 202,742 | ||
Provision for income taxes | 22,835 | $ 65,931 | $ 129,618 | ||
Adjustments | |||||
Disclosure Basis Of Presentation Details [Line Items] | |||||
Income before income taxes | 1,650 | ||||
Net income attributable to Weight Watchers International, Inc. | $ 410 | $ 420 | 320 | ||
Provision for income taxes | $ 1,970 |
Summary of Significant Accoun47
Summary of Significant Accounting Policies - Additional Information (Detail) - USD ($) | 3 Months Ended | 12 Months Ended | |||||||
Jul. 04, 2015 | Apr. 04, 2015 | Sep. 27, 2014 | Jul. 28, 2014 | Mar. 29, 2014 | Jun. 29, 2013 | Jan. 02, 2016 | Jan. 03, 2015 | Dec. 28, 2013 | |
Organization and Summary of Significant Accounting Policies Disclosure [Line Items] | |||||||||
Property, plant and equipment, impairment charges | $ 427,000 | $ 652,000 | |||||||
Asset impairment charges | 2,455,000 | 652,000 | $ 5,426,000 | ||||||
Franchise rights acquired, carrying value | $ 747,326,000 | 760,883,000 | |||||||
Franchise right maturity period | 7 years | ||||||||
Total advertising expenses | $ 191,060,000 | 251,954,000 | 285,298,000 | ||||||
Deferred financing costs | 0 | 0 | 44,817,000 | ||||||
Gain (loss) on early debt extinguishment | $ 6,727,000 | $ 4,749,000 | $ 2,350,000 | $ 10,540,000 | $ 21,685,000 | 11,426,000 | 0 | (21,685,000) | |
Deferred financing costs, amortization expense | 6,886,000 | 9,305,000 | 7,672,000 | ||||||
The cumulative balance of changes in fair value of derivative instruments, net of taxes | (23,135,000) | (21,856,000) | (4,603,000) | ||||||
The cumulative balance of the effects of foreign currency translations, net of taxes | (14,130,000) | 1,906,000 | 13,120,000 | ||||||
Revolving Facility due April 2, 2018 | |||||||||
Organization and Summary of Significant Accounting Policies Disclosure [Line Items] | |||||||||
Write-off of deferred financing fees related to amendment of new credit agreement | $ 1,583,000 | 647,000 | 1,583,000 | ||||||
Restructuring Costs | |||||||||
Organization and Summary of Significant Accounting Policies Disclosure [Line Items] | |||||||||
Deferred financing costs | 1,241,000 | 44,817,000 | |||||||
Internal-use Computer Software | |||||||||
Organization and Summary of Significant Accounting Policies Disclosure [Line Items] | |||||||||
Intangible assets, impairment charges | 2,653,000 | ||||||||
Capitalized software costs | |||||||||
Organization and Summary of Significant Accounting Policies Disclosure [Line Items] | |||||||||
Property, plant and equipment, impairment charges | 2,028,000 | ||||||||
Franchise Rights | |||||||||
Organization and Summary of Significant Accounting Policies Disclosure [Line Items] | |||||||||
Indefinite-lived intangible assets, impairment charges | $ 0 | 0 | |||||||
Website development costs | |||||||||
Organization and Summary of Significant Accounting Policies Disclosure [Line Items] | |||||||||
Finite-lived intangible assets, estimated useful life (in years) | 3 years | ||||||||
CHINA | |||||||||
Organization and Summary of Significant Accounting Policies Disclosure [Line Items] | |||||||||
Property, plant and equipment, impairment charges | 372,000 | ||||||||
Asset impairment charges | 1,607,000 | ||||||||
Intangible assets, impairment charges | 1,235,000 | ||||||||
MEXICO | Franchise Rights | |||||||||
Organization and Summary of Significant Accounting Policies Disclosure [Line Items] | |||||||||
Indefinite-lived intangible assets, impairment charges | 935,000 | ||||||||
HONG KONG | Franchise Rights | |||||||||
Organization and Summary of Significant Accounting Policies Disclosure [Line Items] | |||||||||
Indefinite-lived intangible assets, impairment charges | $ 231,000 | ||||||||
United States | |||||||||
Organization and Summary of Significant Accounting Policies Disclosure [Line Items] | |||||||||
Franchise rights acquired, carrying value | $ 675,515,000 | 675,515,000 | |||||||
Canada | |||||||||
Organization and Summary of Significant Accounting Policies Disclosure [Line Items] | |||||||||
Franchise rights acquired, carrying value | 48,435,000 | 57,579,000 | |||||||
United Kingdom | |||||||||
Organization and Summary of Significant Accounting Policies Disclosure [Line Items] | |||||||||
Franchise rights acquired, carrying value | 11,858,000 | 13,138,000 | |||||||
AUSTRALIA | |||||||||
Organization and Summary of Significant Accounting Policies Disclosure [Line Items] | |||||||||
Franchise rights acquired, carrying value | 6,563,000 | 7,272,000 | |||||||
NEW ZEALAND | |||||||||
Organization and Summary of Significant Accounting Policies Disclosure [Line Items] | |||||||||
Franchise rights acquired, carrying value | 4,833,000 | 5,449,000 | |||||||
Other International | |||||||||
Organization and Summary of Significant Accounting Policies Disclosure [Line Items] | |||||||||
Franchise rights acquired, carrying value | $ 122,000 | $ 1,930,000 | |||||||
Minimum | |||||||||
Organization and Summary of Significant Accounting Policies Disclosure [Line Items] | |||||||||
Equipment,estimated useful life (in years) | 3 years | ||||||||
Finite-lived intangible assets, estimated useful life (in years) | 3 years | ||||||||
Minimum | Capitalized software costs | |||||||||
Organization and Summary of Significant Accounting Policies Disclosure [Line Items] | |||||||||
Finite-lived intangible assets, estimated useful life (in years) | 3 years | ||||||||
Maximum | |||||||||
Organization and Summary of Significant Accounting Policies Disclosure [Line Items] | |||||||||
Equipment,estimated useful life (in years) | 10 years | ||||||||
Finite-lived intangible assets, estimated useful life (in years) | 20 years | ||||||||
Maximum | Franchise Rights | |||||||||
Organization and Summary of Significant Accounting Policies Disclosure [Line Items] | |||||||||
Finite-lived intangible assets, estimated useful life (in years) | 1 year | ||||||||
Maximum | Capitalized software costs | |||||||||
Organization and Summary of Significant Accounting Policies Disclosure [Line Items] | |||||||||
Finite-lived intangible assets, estimated useful life (in years) | 5 years |
Winfrey Transaction - Additiona
Winfrey Transaction - Additional Information (Detail) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | Oct. 19, 2015 | Oct. 18, 2015 | Jan. 02, 2016 | Jan. 02, 2016 | Jan. 03, 2015 | Dec. 28, 2013 |
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | ||||||
Aggregate purchase price | $ 41,475 | |||||
Options exercisable price per share | $ 10.62 | $ 10.62 | ||||
Stock option expense | $ 12,759 | |||||
Share based compensation ,dividend yield | 0.00% | 0.00% | 0.00% | 0.80% | ||
Share based compensation ,volatility | 63.88% | 41.00% | 0.00% | 36.50% | ||
Share based compensation ,risk free rate | 1.36% | |||||
Prior To Third Anniversary | ||||||
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | ||||||
Percentage of options shares to be transferred | 40.00% | |||||
Prior To Fourth Anniversary | ||||||
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | ||||||
Percentage of options shares to be transferred | 60.00% | |||||
Prior To Fifth Anniversary | ||||||
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | ||||||
Percentage of options shares to be transferred | 80.00% | |||||
Prior To Second Anniversary | ||||||
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | ||||||
Percentage of options shares to be transferred | 20.00% | |||||
Option | ||||||
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | ||||||
Common stocks to be purchased through options | 3,513 | 3,513 | 3,513 | |||
Options exercisable price per share | $ 6.97 | |||||
Strategic Collaboration Agreement | ||||||
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | ||||||
Initial term of agreement | 5 years | |||||
Additional renewal terms | 1 year | |||||
Share Purchase Agreement | ||||||
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | ||||||
Purchased shares | 6,362 | |||||
Purchased shares, price per share | $ 6.79 | |||||
Aggregate purchase price | $ 43,199 | |||||
Fees related to share issuance | 2,315 | |||||
Fees related to share issuance, reduction of equity | $ 1,700 | |||||
Share transfer restriction period | 2 years | |||||
Minimum percentage of voting power transfer for change of control | 50.00% | |||||
Share Purchase Agreement | Prior To Third Anniversary | Maximum | ||||||
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | ||||||
Percentage of shares transferable | 15.00% | |||||
Share Purchase Agreement | Prior To Fourth Anniversary | Maximum | ||||||
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | ||||||
Percentage of shares transferable | 30.00% | |||||
Share Purchase Agreement | Prior To Fifth Anniversary | Maximum | ||||||
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | ||||||
Percentage of shares transferable | 60.00% | |||||
Share Purchase Agreement | Right of first offer, the "Securities Act" | Minimum | ||||||
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | ||||||
Percentage of Company's issued and outstanding Common Stock proposed for transfer | 1.00% | |||||
Share Purchase Agreement | Right of first refusal, Competitor of the Company | Minimum | ||||||
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | ||||||
Percentage of Company's issued and outstanding Common Stock proposed for transfer | 1.00% | |||||
Share Purchase Agreement | Right of first refusal | Minimum | ||||||
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | ||||||
Percentage of Company's issued and outstanding Common Stock proposed for transfer | 5.00% |
Acquisitions and Shutdown of 49
Acquisitions and Shutdown of China Operations - Additional Information (Detail) - USD ($) $ / shares in Units, $ in Thousands | Mar. 11, 2015 | Apr. 16, 2014 | Mar. 12, 2014 | Dec. 12, 2013 | Oct. 28, 2013 | Jul. 22, 2013 | Jul. 15, 2013 | Mar. 04, 2013 | Jan. 02, 2016 | Oct. 03, 2015 | Jul. 04, 2015 | Apr. 04, 2015 | Jan. 03, 2015 | Sep. 27, 2014 | Jun. 28, 2014 | Mar. 29, 2014 | Jan. 02, 2016 | Jan. 03, 2015 | Dec. 28, 2013 |
Business Acquisition | |||||||||||||||||||
Business acquisition, purchase price allocation, goodwill | $ 159,331 | $ 168,279 | $ 159,331 | $ 168,279 | |||||||||||||||
Acquired intangible assets amortized period | 105 days | ||||||||||||||||||
Gain related to acquisition | $ 0 | $ 10,540 | $ 0 | ||||||||||||||||
Earnings per share, diluted | $ (0.18) | $ 0.38 | $ 0.49 | $ (0.10) | $ 0.08 | $ 0.67 | $ 0.95 | $ 0.38 | $ 0.56 | $ 2.08 | $ 3.60 | ||||||||
CHINA | |||||||||||||||||||
Business Acquisition | |||||||||||||||||||
Business operation closing cost | $ 2,500 | ||||||||||||||||||
Alberta Ltd and Saskatchewan Ltd | |||||||||||||||||||
Business Acquisition | |||||||||||||||||||
Business acquisition, net purchase price | $ 35,000 | ||||||||||||||||||
Business acquisition, purchase price allocation, goodwill | 34,124 | ||||||||||||||||||
Business acquisition, purchase price allocation, inventory | 218 | ||||||||||||||||||
Business acquisition, purchase price allocation, fixed assets | 182 | ||||||||||||||||||
Business acquisition, purchase price allocation, prepaid expenses | 3 | ||||||||||||||||||
Business acquisition, purchase price allocation, deferred revenue | 1,135 | ||||||||||||||||||
Alberta Ltd and Saskatchewan Ltd | Customer Relationships | |||||||||||||||||||
Business Acquisition | |||||||||||||||||||
Business acquisition, purchase price allocation, identifiable intangibles | 473 | ||||||||||||||||||
Alberta Ltd and Saskatchewan Ltd | Franchise Rights | |||||||||||||||||||
Business Acquisition | |||||||||||||||||||
Business acquisition, purchase price allocation, intangible assets, indefinite lived | $ 1,135 | ||||||||||||||||||
Acquired intangible assets amortized period | 10 months | ||||||||||||||||||
West Virginia, Inc. | |||||||||||||||||||
Business Acquisition | |||||||||||||||||||
Business acquisition, net purchase price | $ 16,028 | ||||||||||||||||||
Business acquisition, purchase price allocation, goodwill | 5,212 | ||||||||||||||||||
Business acquisition, purchase price allocation, fixed assets | 209 | ||||||||||||||||||
Business acquisition, assumed liabilities | 28 | ||||||||||||||||||
West Virginia, Inc. | Customer Relationships | |||||||||||||||||||
Business Acquisition | |||||||||||||||||||
Business acquisition, purchase price allocation, identifiable intangibles | 448 | ||||||||||||||||||
West Virginia, Inc. | Franchise Rights | |||||||||||||||||||
Business Acquisition | |||||||||||||||||||
Business acquisition, purchase price allocation, intangible assets, indefinite lived | $ 10,131 | ||||||||||||||||||
Columbus, Inc. | |||||||||||||||||||
Business Acquisition | |||||||||||||||||||
Business acquisition, net purchase price | $ 23,357 | ||||||||||||||||||
Business acquisition, assumed liabilities | $ 143 | ||||||||||||||||||
Columbus, Inc. | Franchise Rights | |||||||||||||||||||
Business Acquisition | |||||||||||||||||||
Acquired intangible assets amortized period | 5 months | ||||||||||||||||||
Northern Nevada, Inc. | |||||||||||||||||||
Business Acquisition | |||||||||||||||||||
Business acquisition, net purchase price | $ 3,969 | ||||||||||||||||||
Business acquisition, assumed liabilities | 31 | ||||||||||||||||||
Columbus, Inc. and Northern Nevada, Inc. | |||||||||||||||||||
Business Acquisition | |||||||||||||||||||
Business acquisition, purchase price allocation, goodwill | 23,549 | ||||||||||||||||||
Business acquisition, purchase price allocation, inventory | 27 | ||||||||||||||||||
Business acquisition, purchase price allocation, fixed assets | 116 | ||||||||||||||||||
Columbus, Inc. and Northern Nevada, Inc. | Customer Relationships | |||||||||||||||||||
Business Acquisition | |||||||||||||||||||
Business acquisition, purchase price allocation, identifiable intangibles | 494 | ||||||||||||||||||
Columbus, Inc. and Northern Nevada, Inc. | Franchise Rights | |||||||||||||||||||
Business Acquisition | |||||||||||||||||||
Business acquisition, purchase price allocation, intangible assets, indefinite lived | $ 3,314 | ||||||||||||||||||
Manitoba Ltd | |||||||||||||||||||
Business Acquisition | |||||||||||||||||||
Business acquisition, net purchase price | $ 5,197 | ||||||||||||||||||
Business acquisition, purchase price allocation, goodwill | 4,946 | ||||||||||||||||||
Business acquisition, purchase price allocation, inventory | 1 | ||||||||||||||||||
Business acquisition, purchase price allocation, prepaid expenses | 1 | ||||||||||||||||||
Business acquisition, assumed liabilities | 28 | ||||||||||||||||||
Manitoba Ltd | Customer Relationships | |||||||||||||||||||
Business Acquisition | |||||||||||||||||||
Business acquisition, purchase price allocation, identifiable intangibles | 249 | ||||||||||||||||||
Manitoba Ltd | Franchise Rights | |||||||||||||||||||
Business Acquisition | |||||||||||||||||||
Business acquisition, purchase price allocation, intangible assets, indefinite lived | $ 28 | ||||||||||||||||||
Acquired intangible assets amortized period | 2 months | ||||||||||||||||||
Franklin and St Lawrence Counties Inc | |||||||||||||||||||
Business Acquisition | |||||||||||||||||||
Business acquisition, net purchase price | $ 274 | ||||||||||||||||||
Business acquisition, purchase price allocation, goodwill | 223 | ||||||||||||||||||
Business acquisition, purchase price allocation, prepaid expenses | 1 | ||||||||||||||||||
Business acquisition, assumed liabilities | 1 | ||||||||||||||||||
Franklin and St Lawrence Counties Inc | Customer Relationships | |||||||||||||||||||
Business Acquisition | |||||||||||||||||||
Business acquisition, purchase price allocation, identifiable intangibles | 13 | ||||||||||||||||||
Franklin and St Lawrence Counties Inc | Franchise Rights | |||||||||||||||||||
Business Acquisition | |||||||||||||||||||
Business acquisition, purchase price allocation, intangible assets, indefinite lived | $ 38 | ||||||||||||||||||
Acquired intangible assets amortized period | 9 months | ||||||||||||||||||
Vigilantes do Peso Marketing Ltda | |||||||||||||||||||
Business Acquisition | |||||||||||||||||||
Business acquisition, net purchase price | $ 14,181 | ||||||||||||||||||
Business acquisition, purchase price allocation, goodwill | 26,257 | ||||||||||||||||||
Business acquisition, purchase price allocation, inventory | 287 | ||||||||||||||||||
Business acquisition, purchase price allocation, fixed assets | 575 | ||||||||||||||||||
Business acquisition, purchase price allocation, prepaid expenses | 421 | ||||||||||||||||||
Business acquisition, purchase price allocation, deferred revenue | $ 445 | ||||||||||||||||||
Percentage of ownership | 35.00% | ||||||||||||||||||
Percentage of ownership acquired | 45.00% | ||||||||||||||||||
Business acquisition, cash acquired | $ 2,262 | ||||||||||||||||||
Business acquisition, equity interest held immediately before acquisition | 12 | ||||||||||||||||||
Business acquisition, fair value of equity interest | 11,029 | ||||||||||||||||||
Remeasurement gain on business acquisition | 11,017 | ||||||||||||||||||
Business acquisition cost associated with settlement of royalty-free arrangement | 477 | ||||||||||||||||||
Gain related to acquisition | 10,540 | $ 10,540 | |||||||||||||||||
Gain related to acquisition, after-tax | $ 6,429 | ||||||||||||||||||
Earnings per share, diluted | $ 0.11 | ||||||||||||||||||
Business acquisition, fair value of noncontrolling interest | 6,157 | ||||||||||||||||||
Business acquisition, purchase price allocation, net purchase price | 28,616 | ||||||||||||||||||
Business acquisition, purchase price allocation, deferred tax liabilities | $ 680 | ||||||||||||||||||
Vigilantes do Peso Marketing Ltda | Call and Put Option | |||||||||||||||||||
Business Acquisition | |||||||||||||||||||
Percentage of ownership | 20.00% | ||||||||||||||||||
Vigilantes do Peso Marketing Ltda | Customer Relationships | |||||||||||||||||||
Business Acquisition | |||||||||||||||||||
Business acquisition, purchase price allocation, identifiable intangibles | $ 275 | ||||||||||||||||||
Knowplicity, Inc. | |||||||||||||||||||
Business Acquisition | |||||||||||||||||||
Business acquisition, net purchase price | $ 4,770 | ||||||||||||||||||
Business acquisition, purchase price allocation, goodwill | 6,204 | ||||||||||||||||||
Business acquisition, purchase price allocation, fixed assets | 1 | ||||||||||||||||||
Business acquisition, purchase price allocation, prepaid expenses | 4 | ||||||||||||||||||
Business acquisition, cash acquired | 11 | ||||||||||||||||||
Business acquisition, purchase price allocation, net purchase price | 8,977 | ||||||||||||||||||
Business acquisition, purchase price allocation, common stock issued | 4,207 | ||||||||||||||||||
Business acquisition, purchase price allocation, website development | 4,516 | ||||||||||||||||||
Business acquisition, purchase price allocation, deferred tax liabilities | $ 1,759 | ||||||||||||||||||
Weilos | |||||||||||||||||||
Business Acquisition | |||||||||||||||||||
Business acquisition, net purchase price | $ 2,775 | ||||||||||||||||||
Business acquisition, purchase price allocation, goodwill | 5,588 | ||||||||||||||||||
Business acquisition, purchase price allocation, identifiable intangibles | 1,741 | ||||||||||||||||||
Business acquisition, purchase price allocation, fixed assets | 24 | ||||||||||||||||||
Business acquisition, assumed liabilities | 975 | ||||||||||||||||||
Business acquisition, purchase price allocation, net purchase price | 6,674 | ||||||||||||||||||
Business acquisition, purchase price allocation, common stock issued | 2,810 | ||||||||||||||||||
Business acquisition, purchase price allocation, deferred tax liabilities | 679 | ||||||||||||||||||
Business acquisition, purchase price allocation, restricted stock issued | 114 | ||||||||||||||||||
Restricted shares issued to key employees | $ 908 |
Schedule of Net Purchase Price
Schedule of Net Purchase Price of the Acquisition (Detail) - USD ($) $ in Thousands | Mar. 12, 2014 | Mar. 29, 2014 | Jan. 02, 2016 | Jan. 03, 2015 | Dec. 28, 2013 |
Fair value of consideration transferred: | |||||
Total | $ 3,112 | $ 16,678 | $ 83,825 | ||
Gain on acquisition | 0 | 10,540 | $ 0 | ||
Identifiable assets acquired and liabilities assumed: | |||||
Goodwill | $ 159,331 | $ 168,279 | |||
Vigilantes do Peso Marketing Ltda | |||||
Fair value of consideration transferred: | |||||
Net purchase price | $ 14,181 | ||||
Less cash acquired | 2,262 | ||||
Total | 11,919 | ||||
Gain on acquisition | 10,540 | $ 10,540 | |||
Redeemable noncontrolling interest | 6,157 | ||||
Business acquisition, purchase price allocation, net purchase price | 28,616 | ||||
Identifiable assets acquired and liabilities assumed: | |||||
Receivables | 1,139 | ||||
Fixed assets | 575 | ||||
Prepaid expenses | 421 | ||||
Inventory | 287 | ||||
Other assets | 199 | ||||
Accrued liabilities | (1,063) | ||||
Deferred tax on acquired intangibles | (680) | ||||
Deferred revenue | (445) | ||||
Income taxes payable | (258) | ||||
Accounts payable | (91) | ||||
Total identifiable net assets | 2,359 | ||||
Goodwill | 26,257 | ||||
Vigilantes do Peso Marketing Ltda | Franchise Rights | |||||
Identifiable assets acquired and liabilities assumed: | |||||
Intangible assets | 2,000 | ||||
Vigilantes do Peso Marketing Ltda | Customer Relationships | |||||
Identifiable assets acquired and liabilities assumed: | |||||
Intangible assets | $ 275 |
Franchise Rights Acquired, Go51
Franchise Rights Acquired, Goodwill and Other Intangible Assets - Additional Information (Detail) - USD ($) | 12 Months Ended | ||
Jan. 02, 2016 | Jan. 03, 2015 | Dec. 28, 2013 | |
Goodwill and Intangible Assets Disclosure | |||
Finite-lived intangible assets, aggregate amortization expense | $ 34,719,000 | $ 29,372,000 | $ 27,567,000 |
Franchise Rights | |||
Goodwill and Intangible Assets Disclosure | |||
Indefinite-lived intangible assets, impairment charges | $ 0 | $ 0 |
Changes in Carrying Values of G
Changes in Carrying Values of Goodwill (Detail) $ in Thousands | 12 Months Ended |
Jan. 02, 2016USD ($) | |
Goodwill [Line Items] | |
Beginning balance | $ 168,279 |
Goodwill acquired during the period | 5,588 |
Effect of exchange rate changes | (14,536) |
Ending balance | 159,331 |
Other | |
Goodwill [Line Items] | |
Beginning balance | 24,586 |
Goodwill acquired during the period | 0 |
Effect of exchange rate changes | (7,293) |
Ending balance | 17,293 |
North America | |
Goodwill [Line Items] | |
Beginning balance | 134,611 |
Goodwill acquired during the period | 5,588 |
Effect of exchange rate changes | (6,791) |
Ending balance | 133,408 |
United Kingdom | |
Goodwill [Line Items] | |
Beginning balance | 1,421 |
Goodwill acquired during the period | 0 |
Effect of exchange rate changes | (51) |
Ending balance | 1,370 |
Continental Europe | |
Goodwill [Line Items] | |
Beginning balance | 7,661 |
Goodwill acquired during the period | 0 |
Effect of exchange rate changes | (401) |
Ending balance | $ 7,260 |
Carrying Amount of Finite-Lived
Carrying Amount of Finite-Lived Intangible Assets (Detail) - USD ($) $ in Thousands | Jan. 02, 2016 | Jan. 03, 2015 |
Finite-Lived Intangible Assets | ||
Gross Carrying Amount | $ 242,881 | $ 225,883 |
Accumulated Amortization | 176,419 | 156,723 |
Capitalized software costs | ||
Finite-Lived Intangible Assets | ||
Gross Carrying Amount | 119,658 | 107,581 |
Accumulated Amortization | 86,134 | 72,590 |
Trademarks | ||
Finite-Lived Intangible Assets | ||
Gross Carrying Amount | 10,960 | 10,836 |
Accumulated Amortization | 10,435 | 10,213 |
Website development costs | ||
Finite-Lived Intangible Assets | ||
Gross Carrying Amount | 100,105 | 95,717 |
Accumulated Amortization | 68,673 | 63,405 |
Other | ||
Finite-Lived Intangible Assets | ||
Gross Carrying Amount | 7,976 | 7,014 |
Accumulated Amortization | 7,118 | 6,825 |
Trademarks and Other Intangible Assets | ||
Finite-Lived Intangible Assets | ||
Gross Carrying Amount | 238,699 | 221,148 |
Accumulated Amortization | 172,360 | 153,033 |
Franchise Rights | ||
Finite-Lived Intangible Assets | ||
Gross Carrying Amount | 4,182 | 4,735 |
Accumulated Amortization | $ 4,059 | $ 3,690 |
Estimated Amortization Expense
Estimated Amortization Expense of Existing Finite-Lived Intangible Assets (Detail) $ in Thousands | Jan. 02, 2016USD ($) |
Expected Amortization Expense | |
2,016 | $ 32,094 |
2,017 | 24,726 |
2,018 | 8,451 |
2,019 | 1,125 |
2020 and thereafter | $ 66 |
Property and Equipment (Detail)
Property and Equipment (Detail) - USD ($) $ in Thousands | Jan. 02, 2016 | Jan. 03, 2015 |
Property, Plant and Equipment [Line Items] | ||
Equipment | $ 122,789 | $ 124,788 |
Leasehold improvements | 79,115 | 79,496 |
Property, Plant and Equipment, Gross, Total | 201,904 | 204,284 |
Less: Accumulated depreciation and amortization | (143,718) | (129,634) |
Property and equipment, net | $ 58,186 | $ 74,650 |
Property and Equipment - Additi
Property and Equipment - Additional Information (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Jan. 02, 2016 | Jan. 03, 2015 | Dec. 28, 2013 | |
Property, Plant and Equipment [Line Items] | |||
Depreciation and amortization expense, property and equipment | $ 18,452 | $ 20,635 | $ 20,342 |
Components of Current and Long-
Components of Current and Long-Term Debt (Detail) - USD ($) $ in Thousands | Jan. 02, 2016 | Jan. 03, 2015 |
Debt Instrument | ||
Total Debt | $ 2,234,573 | $ 2,358,000 |
Less Current Portion | $ 213,323 | $ 80,728 |
Effective Interest Rate | 3.98% | 3.86% |
Total Long-Term Debt | $ 2,021,250 | $ 2,277,272 |
Tranche B-1 Term Facility due April 2, 2016 | ||
Debt Instrument | ||
Total Debt | $ 144,323 | $ 294,750 |
Effective Interest Rate | 3.19% | 3.12% |
Tranche B-2 Term Facility due April 2, 2020 | ||
Debt Instrument | ||
Total Debt | $ 2,042,250 | $ 2,063,250 |
Effective Interest Rate | 4.00% | 3.96% |
Revolving Facility due April 2, 2018 | ||
Debt Instrument | ||
Total Debt | $ 48,000 | $ 0 |
Effective Interest Rate | 2.75% | 0.00% |
Long-Term Debt - Additional Inf
Long-Term Debt - Additional Information (Detail) - USD ($) | Jul. 14, 2015 | Jun. 26, 2015 | Jun. 17, 2015 | Mar. 25, 2015 | Mar. 13, 2015 | Feb. 21, 2014 | Apr. 30, 2013 | Jul. 04, 2015 | Apr. 04, 2015 | Sep. 27, 2014 | Jul. 28, 2014 | Mar. 29, 2014 | Jun. 29, 2013 | Jan. 02, 2016 | Jan. 03, 2015 | Dec. 28, 2013 | Jun. 22, 2015 | Mar. 20, 2015 | Sep. 26, 2014 | Apr. 02, 2013 |
Debt Instrument | ||||||||||||||||||||
Fees incurred in connection with debt refinancing | $ 44,817,000 | |||||||||||||||||||
Payments of term loan | $ 2,399,904,000 | $ 158,113,000 | $ 30,000,000 | $ 2,488,364,000 | ||||||||||||||||
Gain (loss) on early debt extinguishment | $ 6,727,000 | $ 4,749,000 | $ 2,350,000 | $ 10,540,000 | $ 21,685,000 | 11,426,000 | 0 | $ (21,685,000) | ||||||||||||
Debt outstanding amount | 2,186,573,000 | 2,358,000,000 | ||||||||||||||||||
Credit facility drew down amount | $ 48,000,000 | |||||||||||||||||||
Credit Facility, aggregate principal amount outstanding | $ 2,234,573,000 | $ 2,358,000,000 | ||||||||||||||||||
Additional applicable margin in the event the Company receives a corporate rating of BB- from S&P (or lower) and a corporate rating of Ba3 from Moody's (or lower) | 0.25% | |||||||||||||||||||
Average interest rate on debt, exclusive the impact of swaps | 3.93% | 3.90% | ||||||||||||||||||
Average interest rate on debt, including the impact of swaps | 5.03% | 4.93% | ||||||||||||||||||
Tranche B-1 Term Facility due April 2, 2016 | ||||||||||||||||||||
Debt Instrument | ||||||||||||||||||||
WWI Credit Facility, maximum borrowing capacity | $ 300,000,000 | |||||||||||||||||||
Fees incurred in connection with debt refinancing | $ 641,000 | $ 601,000 | ||||||||||||||||||
Gain (loss) on early debt extinguishment | 6,677,000 | 4,749,000 | ||||||||||||||||||
Prepayment of accepted offers | 77,225,000 | 57,389,000 | ||||||||||||||||||
Accrued and unpaid interest on the amount to be prepaid | 84,862,000 | 63,065,000 | ||||||||||||||||||
Reduction in obligation | 59,728,000 | |||||||||||||||||||
Debt instrument, voluntary prepayment | 2,500,000 | |||||||||||||||||||
Write-off of deferred financing fees | $ 321,000 | $ 326,000 | ||||||||||||||||||
Credit Facility, aggregate principal amount outstanding | $ 144,323,000 | $ 294,750,000 | ||||||||||||||||||
Tranche B-1 Term Facility due April 2, 2016 | London Interbank Offered Rate (LIBOR) | ||||||||||||||||||||
Debt Instrument | ||||||||||||||||||||
WWI Credit Facility, additional interest rate | 2.75% | 3.00% | ||||||||||||||||||
Tranche B-1 Term Facility due April 2, 2016 | Maximum | ||||||||||||||||||||
Debt Instrument | ||||||||||||||||||||
Aggregate principal amount, discount par value | $ 229,000,000 | $ 75,000,000 | ||||||||||||||||||
Tranche B-1 Term Facility due April 2, 2016 | Minimum | ||||||||||||||||||||
Debt Instrument | ||||||||||||||||||||
Debt instrument, interest rate, effective percentage | 9.00% | 9.00% | ||||||||||||||||||
Tranche B-2 Term Facility due April 2, 2020 | ||||||||||||||||||||
Debt Instrument | ||||||||||||||||||||
WWI Credit Facility, maximum borrowing capacity | 2,100,000,000 | |||||||||||||||||||
Credit Facility, aggregate principal amount outstanding | $ 2,042,250,000 | 2,063,250,000 | ||||||||||||||||||
Tranche B-2 Term Facility due April 2, 2020 | London Interbank Offered Rate (LIBOR) | ||||||||||||||||||||
Debt Instrument | ||||||||||||||||||||
WWI Credit Facility, minimum interest rate | 0.75% | |||||||||||||||||||
WWI Credit Facility, additional interest rate | 3.00% | 3.25% | ||||||||||||||||||
Tranche B-2 Term Facility due April 2, 2020 | Base Rate Plus | ||||||||||||||||||||
Debt Instrument | ||||||||||||||||||||
WWI Credit Facility, minimum interest rate | 1.75% | |||||||||||||||||||
Term B Loan due January 26, 2014 | ||||||||||||||||||||
Debt Instrument | ||||||||||||||||||||
Payments of term loan | 128,759,000 | |||||||||||||||||||
Term C Loan due June 30, 2015 | ||||||||||||||||||||
Debt Instrument | ||||||||||||||||||||
Payments of term loan | 110,602,000 | |||||||||||||||||||
Term D Loan due June 30, 2016 | ||||||||||||||||||||
Debt Instrument | ||||||||||||||||||||
Payments of term loan | 117,612,000 | |||||||||||||||||||
Term E Loan due March 15, 2017 | ||||||||||||||||||||
Debt Instrument | ||||||||||||||||||||
Payments of term loan | 1,125,044,000 | |||||||||||||||||||
Term F Loan due March 15, 2019 | ||||||||||||||||||||
Debt Instrument | ||||||||||||||||||||
Payments of term loan | 817,887,000 | |||||||||||||||||||
Revolver A-1 Loan due June 30, 2014 | ||||||||||||||||||||
Debt Instrument | ||||||||||||||||||||
Payments of term loan | 21,247,000 | |||||||||||||||||||
Revolver A-2 Loan due March 15, 2017 | ||||||||||||||||||||
Debt Instrument | ||||||||||||||||||||
Payments of term loan | $ 78,753,000 | |||||||||||||||||||
Term Loan Facility | ||||||||||||||||||||
Debt Instrument | ||||||||||||||||||||
Debt outstanding amount | 2,400,000,000 | |||||||||||||||||||
WWI Credit Facility | ||||||||||||||||||||
Debt Instrument | ||||||||||||||||||||
Credit Facility, aggregate principal amount outstanding | $ 2,186,573,000 | |||||||||||||||||||
Revolving Facility due April 2, 2018 | ||||||||||||||||||||
Debt Instrument | ||||||||||||||||||||
WWI Credit Facility, maximum borrowing capacity | $ 50,000,000 | 250,000,000 | ||||||||||||||||||
Credit facility available amount | 181,000 | $ 248,848,000 | ||||||||||||||||||
Write-off of deferred financing fees related to amendment | $ 1,583,000 | 647,000 | 1,583,000 | |||||||||||||||||
Credit Facility, aggregate principal amount outstanding | 48,000,000 | $ 0 | ||||||||||||||||||
Loan outstanding under the revolving facility | 48,000,000 | |||||||||||||||||||
Line of credit facility, issued but undrawn letters of credit | $ 1,819,000 | |||||||||||||||||||
Revolving credit facility, commitment fee on unused commitments | 0.50% | |||||||||||||||||||
Revolving credit facility, commitment fee amount | $ 186,000 | |||||||||||||||||||
Customary letter of credit fees and fronting fees | $ 48,000 | |||||||||||||||||||
Revolving Facility due April 2, 2018 | London Interbank Offered Rate (LIBOR) | ||||||||||||||||||||
Debt Instrument | ||||||||||||||||||||
WWI Credit Facility, additional interest rate | 2.50% |
Long-Term Debt Maturities (Deta
Long-Term Debt Maturities (Detail) - USD ($) $ in Thousands | Jan. 02, 2016 | Jan. 03, 2015 |
Debt Instrument | ||
2,016 | $ 213,323 | |
2,017 | 21,000 | |
2,018 | 21,000 | |
2,019 | 21,000 | |
2,020 | 1,958,250 | |
Total Debt | $ 2,234,573 | $ 2,358,000 |
Treasury Stock - Additional Inf
Treasury Stock - Additional Information (Detail) - USD ($) | 12 Months Ended | ||||||
Jan. 02, 2016 | Jan. 03, 2015 | Dec. 28, 2013 | Oct. 21, 2010 | May. 25, 2006 | Jun. 13, 2005 | Oct. 09, 2003 | |
Equity, Class of Treasury Stock | |||||||
Treasury Stock, value of common stock shares authorized for repurchase | $ 250,000,000 | $ 250,000,000 | $ 250,000,000 | $ 250,000,000 | |||
Treasury Stock, common stock shares repurchased | 0 | 0 | 0 | ||||
Amount remained available to purchase shares under repurchase program | $ 208,933,000 |
Computation of Basic and Dilute
Computation of Basic and Diluted EPS (Detail) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Jan. 02, 2016 | Oct. 03, 2015 | Jul. 04, 2015 | Apr. 04, 2015 | Jan. 03, 2015 | Sep. 27, 2014 | Jun. 28, 2014 | Mar. 29, 2014 | Jan. 02, 2016 | Jan. 03, 2015 | Dec. 28, 2013 | |
Numerator: | |||||||||||
Net income attributable to Weight Watchers International, Inc. | $ 32,945 | $ 117,787 | $ 202,742 | ||||||||
Denominator: | |||||||||||
Weighted average shares of common stock outstanding | 58,369 | 56,607 | 56,144 | ||||||||
Effect of dilutive common stock equivalents | 597 | 98 | 250 | ||||||||
Weighted average diluted common shares outstanding | 58,966 | 56,705 | 56,394 | ||||||||
Earnings Per Share attributable to Weight Watchers International, Inc. | |||||||||||
Basic | $ (0.18) | $ 0.38 | $ 0.49 | $ (0.10) | $ 0.08 | $ 0.67 | $ 0.95 | $ 0.38 | $ 0.56 | $ 2.08 | $ 3.61 |
Diluted | $ (0.18) | $ 0.38 | $ 0.49 | $ (0.10) | $ 0.08 | $ 0.67 | $ 0.95 | $ 0.38 | $ 0.56 | $ 2.08 | $ 3.60 |
Earnings Per Share - Additional
Earnings Per Share - Additional Information (Detail) - shares shares in Thousands | 12 Months Ended | ||
Jan. 02, 2016 | Jan. 03, 2015 | Dec. 28, 2013 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share | |||
Anti-dilutive common stock equivalents excluded from the calculation of diluted EPS | 1,699 | 3,073 | 1,285 |
Stock Plans - Additional Inform
Stock Plans - Additional Information (Detail) | Jun. 22, 2015USD ($)$ / sharesshares | May. 22, 2015$ / sharesshares | May. 07, 2015 | Jan. 03, 2015$ / sharesshares | Jan. 02, 2016USD ($)$ / sharesshares | Jan. 02, 2016USD ($)$ / sharesshares | Jan. 03, 2015USD ($)$ / sharesshares | Dec. 28, 2013USD ($)$ / sharesshares | Oct. 19, 2015shares |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||
Share based compensation, fully-vested shares granted | shares | 105,000 | ||||||||
Total share-based compensation expense | $ 24,771,000 | $ 10,533,000 | $ 4,255,000 | ||||||
Total income tax benefit recognized for all share-based compensation arrangements | 8,170,000 | 3,285,000 | 1,174,000 | ||||||
Tax benefits realized from options exercised and RSUs vested | 274,000 | $ 301,000 | $ 4,217,000 | ||||||
Compensation costs capitalized | 0 | ||||||||
Total unrecognized compensation cost related to stock options and RSUs granted | $ 19,600,000 | $ 19,600,000 | |||||||
Compensation expense recognition period | 1 year 6 months | ||||||||
Options outstanding, exercise price, lower range | $ / shares | $ 3.97 | ||||||||
Options outstanding, exercise price, upper range | $ / shares | $ 63.59 | ||||||||
Options outstanding | shares | 3,250,000 | 5,330,000 | 5,330,000 | 3,250,000 | |||||
weighted-average exercise price | $ / shares | $ 30.72 | $ 11.79 | $ 11.79 | $ 30.72 | |||||
Stock option expense | $ 12,759,000 | ||||||||
Weighted-average grant-date fair value of options granted | $ / shares | $ 4.86 | $ 6.51 | $ 11.37 | ||||||
Total intrinsic value of options exercised | $ 17,000 | $ 62,000 | $ 9,858,000 | ||||||
Cash received from options exercised | $ 95,000 | $ 658,000 | $ 16,187,000 | ||||||
Weighted-average grant-date fair value of RSUs granted | $ / shares | $ 5.55 | ||||||||
Stock Option | |||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||
Stock option awards, expiration period | 10 years | ||||||||
Option awards granted during period | shares | 0 | ||||||||
Stock Option | Minimum | |||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||
Restricted stock units, vesting period | 3 years | ||||||||
Stock Option | Maximum | |||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||
Restricted stock units, vesting period | 5 years | ||||||||
Special Performance Based Options Awards | |||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||
Compensation expense recognition period | 3 years | ||||||||
Option awards granted during period | shares | 37,000 | 1,601,000 | 687,000 | ||||||
Percentage of time-vesting criteria satisfied on third anniversary of date of grant | 100.00% | ||||||||
Vesting of stock options increments | 20.00% | ||||||||
Performance period (years) | 5 years | ||||||||
Restricted Stock Units | |||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||
Weighted-average grant-date fair value of RSUs granted | $ / shares | $ 5.55 | $ 24.37 | $ 38.40 | ||||||
Total fair value of RSUs vested | $ 1,804,000 | $ 3,042,000 | $ 1,705,000 | ||||||
Restricted Stock Units | Minimum | |||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||
Restricted stock units, vesting period | 3 years | ||||||||
Restricted Stock Units | Maximum | |||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||
Restricted stock units, vesting period | 5 years | ||||||||
Options To Purchase Common Stock | |||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||
Restricted stock units, vesting period | 3 years | ||||||||
Options outstanding | shares | 734,000 | 1,700,000 | |||||||
Percentage of options eligible for exchange | 99.60% | ||||||||
weighted-average exercise price | $ / shares | $ 5.25 | $ 24.68 | |||||||
Stock option expense | $ 1,599,000 | ||||||||
Options To Purchase Common Stock | Vesting on the first anniversary | |||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||
Vesting percentage | 25.00% | ||||||||
Options To Purchase Common Stock | Vesting on the second anniversary | |||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||
Vesting percentage | 25.00% | ||||||||
Options To Purchase Common Stock | Vesting on the third anniversary | |||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||
Vesting percentage | 50.00% | ||||||||
Option | |||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||
Common stocks to be purchased through options | shares | 3,513,000 | 3,513,000 | 3,513,000 | ||||||
Stock Incentive Plan 2014 | |||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||
Common stocks to be purchased through options | shares | 3,500,000 | 3,500,000 | |||||||
Stock Incentive Plan 2004 | |||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||
Share based compensation, fully-vested shares granted | shares | 50,000 | 20,000 | 14,000 | ||||||
Share based compensation, value of fully-vested shares granted | $ 507,000 | $ 497,000 | $ 524,000 | ||||||
Employees | Stock Incentive Plan 2014 | |||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||
Stock conversion ratio | 2 | ||||||||
Chief Executive Officer | Stock Incentive Plan 2014 | |||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||
Stock conversion ratio | 3.5 |
Weighted Average Assumptions Us
Weighted Average Assumptions Used to Estimate Fair Value of Option Award on Grand Date (Detail) | Oct. 19, 2015 | Jan. 02, 2016 | Jan. 03, 2015 | Dec. 28, 2013 |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Dividend yield | 0.00% | 0.00% | 0.00% | 0.80% |
Volatility | 63.88% | 41.00% | 0.00% | 36.50% |
Risk-free interest rate, minimum | 1.84% | 0.00% | 1.30% | |
Risk-free interest rate, maximum | 1.89% | 0.00% | 2.20% | |
Expected term (years) | 6 years | 0 years | 6 years 6 months | |
Special Performance Based Options Awards | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Dividend yield | 0.00% | 0.00% | 0.00% | |
Volatility | 40.50% | 37.80% | 36.50% | |
Risk-free interest rate, minimum | 1.60% | 1.40% | 2.00% | |
Risk-free interest rate, maximum | 1.80% | |||
Expected term (years) | 5 years | 5 years | 5 years |
Summary of Option Activity Unde
Summary of Option Activity Under Stock Plans (Detail) $ / shares in Units, shares in Thousands, $ in Thousands | 12 Months Ended |
Jan. 02, 2016USD ($)$ / sharesshares | |
Shares | |
Beginning Balance | shares | 3,250 |
Granted | shares | 4,572 |
Exercised | shares | (4) |
Exchanged | shares | (1,700) |
Cancelled | shares | (788) |
Ending Balance | shares | 5,330 |
Exercisable at January 2, 2016 | shares | 3,916 |
Weighted-Average Exercise Price | |
Beginning Balance | $ / shares | $ 30.72 |
Granted | $ / shares | 6.61 |
Exercised | $ / shares | 22.67 |
Exchanged | $ / shares | 24.68 |
Cancelled | $ / shares | 31.94 |
Ending Balance | $ / shares | 11.79 |
Exercisable at January 2, 2016 | $ / shares | $ 10.62 |
Outstanding at January 2, 2016 | 9 years 2 months 12 days |
Exercisable at January 2, 2016 | 9 years 3 months 18 days |
Outstanding at January 2, 2016 | $ | $ 73,260 |
Exercisable at January 2, 2016 | $ | $ 55,772 |
Summary of RSU Activity Under S
Summary of RSU Activity Under Stock Plans (Detail) shares in Thousands | 12 Months Ended |
Jan. 02, 2016$ / sharesshares | |
Shares | |
Beginning Balance | shares | 838 |
Granted | shares | 780 |
Vested | shares | (35) |
Forfeited | shares | (217) |
Ending Balance | shares | 1,366 |
Weighted-Average Grant-Date Fair Value | |
Beginning Balance | $ / shares | $ 27.71 |
Granted | $ / shares | 5.55 |
Vested | $ / shares | 51.18 |
Forfeited | $ / shares | 26.25 |
Ending Balance | $ / shares | $ 27.71 |
Summary of Consolidated Provisi
Summary of Consolidated Provision for US Federal State and Foreign Taxes on Income (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Jan. 02, 2016 | Jan. 03, 2015 | Dec. 28, 2013 | |
Current: | |||
US federal | $ (6,862) | $ 12,904 | $ 60,030 |
State | 1,859 | (131) | 9,583 |
Foreign | 15,740 | 24,059 | 25,647 |
Current Income Tax Expense (Benefit), Total | 10,737 | 36,832 | 95,260 |
Deferred: | |||
US federal | 10,756 | 25,162 | 30,513 |
State | 1,890 | 2,876 | 3,487 |
Foreign | (548) | 1,061 | 358 |
Deferred tax provision | 12,098 | 29,099 | 34,358 |
Total tax provision | $ 22,835 | $ 65,931 | $ 129,618 |
Components of Consolidated Inco
Components of Consolidated Income Before Income Taxes (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Jan. 02, 2016 | Jan. 03, 2015 | Dec. 28, 2013 | |
Income Taxes [Line Items] | |||
Domestic | $ 6,299 | $ 88,024 | $ 248,637 |
Foreign | 49,315 | 95,640 | 83,723 |
Income before income taxes | $ 55,614 | $ 183,664 | $ 332,360 |
Difference Between US Federal S
Difference Between US Federal Statutory Tax Rate and consolidated Effective Tax Rate (Detail) | 12 Months Ended | ||
Jan. 02, 2016 | Jan. 03, 2015 | Dec. 28, 2013 | |
Reconciliation of Statutory Federal Tax Rate [Line Items] | |||
US federal statutory rate | 35.00% | 35.00% | 35.00% |
States income taxes (net of federal benefit) | 3.80% | 1.30% | 2.70% |
Reserves for uncertain tax positions | 3.50% | 0.40% | (0.10%) |
Foreign taxes | (0.40%) | (0.60%) | 0.40% |
(Decrease) increase in valuation allowance | (2.20%) | 1.70% | 0.90% |
Loss on closure of China | 0.00% | (2.10%) | 0.00% |
Other | 1.40% | 0.20% | 0.10% |
Effective tax rate | 41.10% | 35.90% | 39.00% |
Deferred Tax Assets and Liabili
Deferred Tax Assets and Liabilities (Detail) - USD ($) $ in Thousands | Jan. 02, 2016 | Jan. 03, 2015 |
Schedule of Deferred Income Tax Assets and Liabilities [Line Items] | ||
Provision for estimated expenses | $ 4,638 | $ 7,863 |
Depreciation | 4,164 | 0 |
Operating loss carryforwards | 34,285 | 37,746 |
Salaries and wages | 641 | 9,567 |
Share-based compensation | 14,330 | 6,653 |
Other | 8,024 | 6,922 |
Other comprehensive income | 24,778 | 13,060 |
Less: valuation allowance | (28,279) | (34,640) |
Total deferred tax assets | 62,581 | 47,171 |
Depreciation | 0 | (6,482) |
Other | (1,823) | (3,123) |
Amortization | (210,901) | (188,745) |
Total deferred tax liabilities | (212,724) | (198,350) |
Net deferred tax liabilities | $ (150,143) | $ (151,179) |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Jan. 02, 2016 | Jan. 03, 2015 | Dec. 28, 2013 | |
Income Tax Contingency [Line Items] | |||
Net operating loss carry forwards | $ 138,562 | $ 142,433 | |
Deferred tax liability, foreign subsidiaries | 10,000 | ||
Total amount of unrecognized tax benefits, if recognized, would affect effective tax rate | 6,948 | ||
Unrecognized tax benefits, accrued interest and penalties | 1,229 | 2,300 | |
Unrecognized tax benefits, interest and penalties recognized | $ (266) | $ 83 | $ (1,188) |
Reconciliation of Beginning and
Reconciliation of Beginning and Ending Amount of Unrecognized Tax Benefits (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Jan. 02, 2016 | Jan. 03, 2015 | Dec. 28, 2013 | |
Income Tax Contingency [Line Items] | |||
Balance at beginning of year | $ 6,268 | $ 5,784 | $ 5,319 |
Additions based on tax positions related to the current year | 2,106 | 1,304 | 1,428 |
Reductions for tax positions of prior years | (676) | (820) | (963) |
Balance at end of year | $ 7,698 | $ 6,268 | $ 5,784 |
Employee Benefit Plans - Additi
Employee Benefit Plans - Additional Information (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Jan. 02, 2016 | Jan. 03, 2015 | Dec. 28, 2013 | |
Profit Sharing Plan | |||
Defined Contribution Plan Disclosure [Line Items] | |||
Employee benefit plans, contribution cost | $ 733 | $ 266 | $ 1,658 |
Profit Sharing Plan | Management | |||
Defined Contribution Plan Disclosure [Line Items] | |||
Employee benefit plans, contribution cost | $ 1,950 | $ 1,090 | $ 2,651 |
EPSP annualized interest rate, added percentage above prime rate | 2.00% | ||
Maximum | Profit Sharing Plan | Management | |||
Defined Contribution Plan Disclosure [Line Items] | |||
EPSP annualized interest rate cap | 15.00% | ||
Savings Plan | |||
Defined Contribution Plan Disclosure [Line Items] | |||
Employee benefit plans, employer contribution percentage | 3.00% | 3.00% | 3.00% |
Employee benefit plans, contribution cost | $ 2,454 | $ 2,525 | $ 2,888 |
Savings Plan | Maximum | |||
Defined Contribution Plan Disclosure [Line Items] | |||
Employee benefit plans, employer matching contribution percentage | 100.00% | 100.00% | 100.00% |
Cash Flow Information (Detail)
Cash Flow Information (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Jan. 02, 2016 | Jan. 03, 2015 | Dec. 28, 2013 | |
Net cash paid during the year for: | |||
Interest expense | $ 117,602 | $ 123,100 | $ 99,687 |
Income taxes | 25,566 | 35,232 | 87,071 |
Noncash investing and financing activities were as follows: | |||
Fair value of net assets/(liabilities) acquired in connection with acquisitions | 1,439 | 359 | (175) |
Change in Capital expenditures and Capitalized software included in accounts payable and accrued expenses | (1,969) | 3,347 | (5,432) |
Dividends declared but not yet paid at year-end | $ 0 | $ 0 | $ 177 |
Commitment and Contingencies -
Commitment and Contingencies - Additional Information (Detail) $ in Thousands | 1 Months Ended | 12 Months Ended | ||
Mar. 29, 2014LegalMatter | Jan. 02, 2016USD ($) | Jan. 03, 2015USD ($) | Dec. 28, 2013USD ($) | |
Loss Contingencies | ||||
Securities class action filed | LegalMatter | 2 | |||
Rent expense charged to operations under operating leases | $ | $ 42,133 | $ 44,228 | $ 46,300 |
Minimum Commitments Under Non-C
Minimum Commitments Under Non-Cancelable Obligations (Detail) $ in Thousands | Jan. 02, 2016USD ($) |
Operating Leased Assets [Line Items] | |
2,016 | $ 46,086 |
2,017 | 30,650 |
2,018 | 20,214 |
2,019 | 15,098 |
2,020 | 12,093 |
2021 and thereafter | 95,437 |
Total | $ 219,578 |
Segment and Geographic Data - A
Segment and Geographic Data - Additional Information (Detail) | 12 Months Ended |
Jan. 02, 2016Segment | |
Segment Reporting Information [Line Items] | |
Number of reportable segments | 4 |
Information About Reportable Se
Information About Reportable Segments (Detail) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||||
Jan. 02, 2016 | Oct. 03, 2015 | Jul. 04, 2015 | Apr. 04, 2015 | Jan. 03, 2015 | Sep. 27, 2014 | Jul. 28, 2014 | Jun. 28, 2014 | Mar. 29, 2014 | Jun. 29, 2013 | Jan. 02, 2016 | Jan. 03, 2015 | Dec. 28, 2013 | |
Segment Reporting Information [Line Items] | |||||||||||||
Net revenue | $ 259,238 | $ 273,324 | $ 309,754 | $ 322,103 | $ 327,827 | $ 345,184 | $ 397,547 | $ 409,358 | $ 1,164,419 | $ 1,479,916 | $ 1,724,123 | ||
Segment operating income | 16,326 | 63,108 | 70,580 | 18,044 | 42,303 | 91,394 | 114,564 | 51,053 | 168,058 | 299,314 | 457,752 | ||
Interest expense | 121,843 | 122,984 | 103,108 | ||||||||||
Other expense, net | 2,027 | 3,206 | 599 | ||||||||||
Gain on Brazil acquisition | 0 | (10,540) | 0 | ||||||||||
(Gain) loss on early extinguishment of debt | (6,727) | (4,749) | $ (2,350) | (10,540) | $ (21,685) | (11,426) | 0 | 21,685 | |||||
Provision for taxes | 22,835 | 65,931 | 129,618 | ||||||||||
Net income | $ (11,309) | $ 21,790 | $ 27,877 | $ (5,433) | $ 4,362 | $ 37,892 | $ 54,002 | $ 21,531 | 32,779 | 117,733 | 202,742 | ||
Less: Net loss attributable to the noncontrolling interest | 166 | 54 | 0 | ||||||||||
Net income attributable to Weight Watchers International, Inc. | 32,945 | 117,787 | 202,742 | ||||||||||
Depreciation and amortization | 60,057 | 58,539 | 55,581 | ||||||||||
Operating Segments | |||||||||||||
Segment Reporting Information [Line Items] | |||||||||||||
Segment operating income | 235,260 | 372,427 | 517,580 | ||||||||||
Depreciation and amortization | 51,228 | 40,312 | 41,384 | ||||||||||
General corporate expenses | |||||||||||||
Segment Reporting Information [Line Items] | |||||||||||||
General corporate expenses | (67,202) | (73,113) | (59,828) | ||||||||||
Depreciation and amortization | 8,829 | 18,227 | 14,197 | ||||||||||
North America | |||||||||||||
Segment Reporting Information [Line Items] | |||||||||||||
Net revenue | 755,396 | 947,716 | 1,163,002 | ||||||||||
North America | Operating Segments | |||||||||||||
Segment Reporting Information [Line Items] | |||||||||||||
Segment operating income | 140,579 | 250,282 | 403,104 | ||||||||||
Depreciation and amortization | 47,128 | 34,654 | 35,928 | ||||||||||
United Kingdom | |||||||||||||
Segment Reporting Information [Line Items] | |||||||||||||
Net revenue | 124,773 | 156,843 | 172,783 | ||||||||||
United Kingdom | Operating Segments | |||||||||||||
Segment Reporting Information [Line Items] | |||||||||||||
Segment operating income | 24,310 | 29,187 | 34,429 | ||||||||||
Depreciation and amortization | 766 | 1,158 | 1,269 | ||||||||||
Continental Europe | |||||||||||||
Segment Reporting Information [Line Items] | |||||||||||||
Net revenue | 229,147 | 298,878 | 299,403 | ||||||||||
Continental Europe | Operating Segments | |||||||||||||
Segment Reporting Information [Line Items] | |||||||||||||
Segment operating income | 62,364 | 79,282 | 66,273 | ||||||||||
Depreciation and amortization | 1,861 | 2,356 | 2,222 | ||||||||||
Other | |||||||||||||
Segment Reporting Information [Line Items] | |||||||||||||
Net revenue | 55,103 | 76,479 | 88,935 | ||||||||||
Other | Operating Segments | |||||||||||||
Segment Reporting Information [Line Items] | |||||||||||||
Segment operating income | 8,007 | 13,676 | 13,774 | ||||||||||
Depreciation and amortization | $ 1,473 | $ 2,144 | $ 1,965 |
Sources of Revenue and Other In
Sources of Revenue and Other Information by Geographic Area (Detail) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Jan. 02, 2016 | Oct. 03, 2015 | Jul. 04, 2015 | Apr. 04, 2015 | Jan. 03, 2015 | Sep. 27, 2014 | Jun. 28, 2014 | Mar. 29, 2014 | Jan. 02, 2016 | Jan. 03, 2015 | Dec. 28, 2013 | |
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||||||||
Meeting Fees | $ 937,368 | $ 1,181,945 | $ 1,360,761 | ||||||||
Online Subscription Revenues | 349,567 | 437,385 | 509,135 | ||||||||
In-meeting product sales | 127,291 | 169,101 | 211,963 | ||||||||
Licensing, franchise royalties and other | 99,760 | 128,870 | 151,399 | ||||||||
Net revenue | $ 259,238 | $ 273,324 | $ 309,754 | $ 322,103 | $ 327,827 | $ 345,184 | $ 397,547 | $ 409,358 | 1,164,419 | 1,479,916 | 1,724,123 |
Long-lived assets | 58,186 | 74,650 | 58,186 | 74,650 | 87,052 | ||||||
United States | |||||||||||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||||||||
Net revenue | 700,972 | 869,541 | 1,067,200 | ||||||||
Long-lived assets | 51,103 | 67,903 | 51,103 | 67,903 | 79,448 | ||||||
Canada | |||||||||||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||||||||
Net revenue | 54,277 | 78,175 | 95,802 | ||||||||
Long-lived assets | 2,757 | 3,149 | 2,757 | 3,149 | 3,070 | ||||||
United Kingdom | |||||||||||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||||||||
Net revenue | 124,773 | 156,843 | 172,783 | ||||||||
Long-lived assets | 2,938 | 724 | 2,938 | 724 | 1,192 | ||||||
Continental Europe | |||||||||||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||||||||
Net revenue | 229,147 | 298,878 | 299,403 | ||||||||
Long-lived assets | 614 | 1,454 | 614 | 1,454 | 2,083 | ||||||
Other | |||||||||||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||||||||
Net revenue | 55,250 | 76,479 | 88,935 | ||||||||
Long-lived assets | $ 774 | $ 1,420 | 774 | 1,420 | 1,259 | ||||||
meeting fees | |||||||||||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||||||||
Meeting Fees | $ 587,801 | $ 744,560 | $ 851,626 |
Fair Value Measurements - Addit
Fair Value Measurements - Additional Information (Detail) - USD ($) $ in Thousands | Jan. 02, 2016 | Jan. 03, 2015 |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Fair value of long-term debt | $ 1,682,778 | $ 1,888,051 |
Debt instrument carrying amount | 2,186,573 | $ 2,358,000 |
Revolving Facility due April 2, 2018 | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Carrying value of long-term debt | $ 48,000 |
Aggregate Fair Value of Derivat
Aggregate Fair Value of Derivative Financial Instruments (Detail) - Fair Value, Measurements, Recurring - Interest Rate Swap - USD ($) $ in Thousands | Jan. 02, 2016 | Jan. 03, 2015 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | ||
Interest rate swap liability | $ 44,170 | $ 42,423 |
Fair Value Measurements Using Quoted Prices in Active Markets for Identical Assets (Level 1) | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | ||
Interest rate swap liability | 0 | 0 |
Fair Value Measurements Using Significant Other Observable Inputs (Level 2) | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | ||
Interest rate swap liability | 44,170 | 42,423 |
Fair Value Measurements Using Significant Unobservable Inputs (Level 3) | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | ||
Interest rate swap liability | $ 0 | $ 0 |
Derivative Instruments and He82
Derivative Instruments and Hedging - Additional Information (Detail) - USD ($) | Jul. 26, 2013 | Jan. 31, 2009 | Jan. 02, 2016 | Jan. 03, 2015 | Dec. 28, 2013 |
Derivative | |||||
Cumulative losses for qualifying hedges reported as a component of accumulated other comprehensive loss, net of tax | $ (23,135,000) | $ (21,856,000) | $ (4,603,000) | ||
Maximum length of time hedging forecasted | 6 years | ||||
Derivative losses included in accumulated other comprehensive loss that are expected to be reclassified into earnings within the next 12 months, net of tax | $ (10,796,000) | ||||
Derivative losses included in accumulated other comprehensive loss that are expected to be reclassified into earnings within the next 12 months, before tax | $ (17,698,000) | ||||
Interest Rate Swap | |||||
Derivative | |||||
Forward-starting interest rate swap, effective date | Mar. 31, 2014 | Jan. 4, 2014 | |||
Forward starting interest rate swap, termination date | Apr. 2, 2020 | Jan. 27, 2014 | |||
Derivative interest rate swap percentage | 2.38% | ||||
Cumulative losses for qualifying hedges reported as a component of accumulated other comprehensive loss, net of tax | $ (23,135,000) | (21,856,000) | |||
Cumulative losses for qualifying hedges reported as a component of accumulated other comprehensive loss, before tax | (38,053,000) | (35,830,000) | |||
Interest Rate Swap | Cash Flow Hedging | |||||
Derivative | |||||
Notional amount | $ 1,500,000,000 | 1,500,000,000 | $ 1,500,000,000 | ||
Interest Rate Swap | Cash Flow Hedging | March 31, 2014 | |||||
Derivative | |||||
Notional amount | $ 1,500,000,000 | ||||
Forward-starting interest rate swap, effective date | Mar. 31, 2014 | ||||
Interest Rate Swap | Cash Flow Hedging | April 3, 2017 | |||||
Derivative | |||||
Notional amount | $ 1,250,000,000 | ||||
Forward-starting interest rate swap, effective date | Apr. 3, 2017 | ||||
Interest Rate Swap | Cash Flow Hedging | April 1, 2019 | |||||
Derivative | |||||
Notional amount | $ 1,000,000,000 | ||||
Forward-starting interest rate swap, effective date | Apr. 1, 2019 |
Accumulated Other Comprehensi83
Accumulated Other Comprehensive Loss - Additional Information (Detail) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | ||||||||||
Jan. 02, 2016 | Oct. 03, 2015 | Jul. 04, 2015 | Apr. 04, 2015 | Jan. 03, 2015 | Sep. 27, 2014 | Jun. 28, 2014 | Mar. 29, 2014 | Jan. 02, 2016 | Jan. 03, 2015 | Dec. 28, 2013 | ||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||||||||||
Income before income taxes | $ 55,614 | $ 183,664 | $ 332,360 | |||||||||
Net income | $ (11,309) | $ 21,790 | $ 27,877 | $ (5,433) | $ 4,362 | $ 37,892 | $ 54,002 | $ 21,531 | 32,779 | 117,733 | 202,742 | |
Reclassification out of Accumulated Other Comprehensive Income | Loss on Qualifying Hedges | Interest Rate Contract | ||||||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||||||||||
Income before income taxes | [1] | 24,741 | 19,815 | 10,037 | ||||||||
Net income | [1] | $ 15,092 | 12,087 | $ 6,123 | ||||||||
Reclassification out of Accumulated Other Comprehensive Income | Loss on Qualifying Hedges | Interest Rate Contract | As Reported | ||||||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||||||||||
Income before income taxes | (7,413) | |||||||||||
Net income | (4,522) | |||||||||||
Reclassification out of Accumulated Other Comprehensive Income | Loss on Qualifying Hedges | Interest Rate Contract | Scenario, Adjustment | ||||||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||||||||||
Income before income taxes | (19,815) | |||||||||||
Net income | $ (12,087) | |||||||||||
[1] | Amounts in parentheses indicate debits to profit / loss |
Changes in Accumulated Other Co
Changes in Accumulated Other Comprehensive Income (Loss) by Component (Detail) - USD ($) $ in Thousands | 12 Months Ended | |||
Jan. 02, 2016 | Jan. 03, 2015 | Dec. 28, 2013 | ||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||
Beginning Balance | [1] | $ (19,950) | $ 8,517 | $ 12,859 |
Other comprehensive loss before reclassifications, net of tax | [1] | (33,344) | (41,032) | (10,465) |
Amounts reclassified from accumulated other comprehensive income (loss), net of tax | [1],[2] | 15,092 | 12,087 | 6,123 |
Total other comprehensive loss | [1] | (18,252) | (28,945) | (4,342) |
Less: net current period other comprehensive loss attributable to the noncontrolling interest | [1] | 937 | 478 | |
Ending Balance | [1] | (37,265) | (19,950) | 8,517 |
Loss on Qualifying Hedges | ||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||
Beginning Balance | [1] | (21,856) | (4,603) | (6,602) |
Other comprehensive loss before reclassifications, net of tax | [1] | (16,371) | (29,340) | (4,124) |
Amounts reclassified from accumulated other comprehensive income (loss), net of tax | [1],[2] | 15,092 | 12,087 | 6,123 |
Total other comprehensive loss | [1] | (1,279) | (17,253) | 1,999 |
Less: net current period other comprehensive loss attributable to the noncontrolling interest | [1] | 0 | 0 | |
Ending Balance | [1] | (23,135) | (21,856) | (4,603) |
Foreign Currency Translation Adjustments | ||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||
Beginning Balance | [1] | 1,906 | 13,120 | 19,461 |
Other comprehensive loss before reclassifications, net of tax | [1] | (16,973) | (11,692) | (6,341) |
Amounts reclassified from accumulated other comprehensive income (loss), net of tax | [1],[2] | 0 | 0 | 0 |
Total other comprehensive loss | [1] | (16,973) | (11,692) | (6,341) |
Less: net current period other comprehensive loss attributable to the noncontrolling interest | [1] | 937 | 478 | |
Ending Balance | [1] | $ (14,130) | $ 1,906 | $ 13,120 |
[1] | Amounts in parentheses indicate debits | |||
[2] | See separate table below for details about these reclassifications |
Reclassifications out of Accumu
Reclassifications out of Accumulated Other Comprehensive Income (Loss) (Detail) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | ||||||||||
Jan. 02, 2016 | Oct. 03, 2015 | Jul. 04, 2015 | Apr. 04, 2015 | Jan. 03, 2015 | Sep. 27, 2014 | Jun. 28, 2014 | Mar. 29, 2014 | Jan. 02, 2016 | Jan. 03, 2015 | Dec. 28, 2013 | ||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | ||||||||||||
Interest expense | $ (121,843) | $ (122,984) | $ (103,108) | |||||||||
Income before income taxes | (55,614) | (183,664) | (332,360) | |||||||||
Provision for income taxes | 22,835 | 65,931 | 129,618 | |||||||||
Net income | $ 11,309 | $ (21,790) | $ (27,877) | $ 5,433 | $ (4,362) | $ (37,892) | $ (54,002) | $ (21,531) | (32,779) | (117,733) | (202,742) | |
Reclassification out of Accumulated Other Comprehensive Income | Loss on Qualifying Hedges | Interest Rate Contract | ||||||||||||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | ||||||||||||
Interest expense | [1] | (24,741) | (19,815) | (10,037) | ||||||||
Income before income taxes | [1] | (24,741) | (19,815) | (10,037) | ||||||||
Provision for income taxes | [1] | 9,649 | 7,728 | 3,914 | ||||||||
Net income | [1] | $ (15,092) | $ (12,087) | $ (6,123) | ||||||||
[1] | Amounts in parentheses indicate debits to profit / loss |
Restructuring Charges - Additio
Restructuring Charges - Additional Information (Detail) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | ||||||||
Jan. 02, 2016 | Oct. 03, 2015 | Jul. 04, 2015 | Apr. 04, 2015 | Jan. 03, 2015 | Sep. 27, 2014 | Jun. 28, 2014 | Mar. 29, 2014 | Jan. 02, 2016 | Jan. 03, 2015 | |
Restructuring Cost and Reserve [Line Items] | ||||||||||
Employee termination benefit costs, pretax | $ 1,338 | $ 1,081 | $ 232 | $ 5,761 | $ 973 | $ 713 | $ 6,498 | $ 3,656 | $ 8,412 | $ 11,840 |
Employee termination benefit costs, after tax | 815 | $ 660 | $ 142 | $ 3,514 | $ 593 | $ 430 | $ 3,964 | $ 2,235 | 5,131 | 7,222 |
Expected restructuring liability to be paid in current fiscal year | $ 1,809 | 1,809 | ||||||||
Cost of Revenues | ||||||||||
Restructuring Cost and Reserve [Line Items] | ||||||||||
Employee termination benefit costs, pretax | 1,505 | 4,642 | ||||||||
Selling, General and Administrative Expenses | ||||||||||
Restructuring Cost and Reserve [Line Items] | ||||||||||
Employee termination benefit costs, pretax | $ 6,907 | $ 7,198 |
Reconciliation of Liability Bal
Reconciliation of Liability Balance for Restructuring Charges (Detail) $ in Thousands | 12 Months Ended |
Jan. 02, 2016USD ($) | |
Restructuring Cost and Reserve [Line Items] | |
Beginning balance | $ 2,570 |
Provision | 8,412 |
Payments | (9,173) |
Ending balance | $ 1,809 |
Related Party Transactions - Ad
Related Party Transactions - Additional Information (Detail) $ in Thousands | 12 Months Ended |
Jan. 02, 2016USD ($) | |
Ms. Winfrey and her related entities | |
Related Party Transaction [Line Items] | |
Related Party Transaction, service provided by related party | $ 647 |
Ms. Winfrey | |
Related Party Transaction [Line Items] | |
Accounts payable to related parties | $ 574 |
Quarterly Financial Informati89
Quarterly Financial Information (Unaudited) (Detail) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Jan. 02, 2016 | Oct. 03, 2015 | Jul. 04, 2015 | Apr. 04, 2015 | Jan. 03, 2015 | Sep. 27, 2014 | Jun. 28, 2014 | Mar. 29, 2014 | Jan. 02, 2016 | Jan. 03, 2015 | Dec. 28, 2013 | |
Quarterly Financial Information [Line Items] | |||||||||||
Revenues, net | $ 259,238 | $ 273,324 | $ 309,754 | $ 322,103 | $ 327,827 | $ 345,184 | $ 397,547 | $ 409,358 | $ 1,164,419 | $ 1,479,916 | $ 1,724,123 |
Gross profit | 120,798 | 136,622 | 159,364 | 157,303 | 166,270 | 187,567 | 225,814 | 222,900 | 574,087 | 802,551 | 1,001,112 |
Operating income | 16,326 | 63,108 | 70,580 | 18,044 | 42,303 | 91,394 | 114,564 | 51,053 | 168,058 | 299,314 | 457,752 |
Net (loss) income | $ (11,309) | $ 21,790 | $ 27,877 | $ (5,433) | $ 4,362 | $ 37,892 | $ 54,002 | $ 21,531 | $ 32,779 | $ 117,733 | $ 202,742 |
Basic earnings per share | $ (0.18) | $ 0.38 | $ 0.49 | $ (0.10) | $ 0.08 | $ 0.67 | $ 0.95 | $ 0.38 | $ 0.56 | $ 2.08 | $ 3.61 |
Diluted earnings per share | $ (0.18) | $ 0.38 | $ 0.49 | $ (0.10) | $ 0.08 | $ 0.67 | $ 0.95 | $ 0.38 | $ 0.56 | $ 2.08 | $ 3.60 |
Quarterly Financial Informati90
Quarterly Financial Information - Additional Information (Detail) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||||
Jan. 02, 2016 | Oct. 03, 2015 | Jul. 04, 2015 | Apr. 04, 2015 | Jan. 03, 2015 | Sep. 27, 2014 | Jul. 28, 2014 | Jun. 28, 2014 | Mar. 29, 2014 | Jun. 29, 2013 | Jan. 02, 2016 | Jan. 03, 2015 | Dec. 28, 2013 | |
Quarterly Financial Information [Line Items] | |||||||||||||
Employee termination benefit costs, pretax | $ 1,338 | $ 1,081 | $ 232 | $ 5,761 | $ 973 | $ 713 | $ 6,498 | $ 3,656 | $ 8,412 | $ 11,840 | |||
Employee termination benefit costs, after tax | 815 | $ 660 | 142 | 3,514 | $ 593 | $ 430 | $ 3,964 | 2,235 | 5,131 | 7,222 | |||
Impact of early extinguishment of debt on net income before of tax | 6,727 | 4,749 | $ 2,350 | 10,540 | $ 21,685 | 11,426 | 0 | $ (21,685) | |||||
Impact of early extinguishment of debt on net income net of tax | $ 4,103 | $ 2,897 | $ 6,396 | ||||||||||
Impact of early extinguishment of debt per fully diluted share | $ 0.07 | $ 0.05 | $ 0.04 | $ 0.11 | |||||||||
Net income attributable to Weight Watchers International, Inc. | 32,945 | $ 117,787 | $ 202,742 | ||||||||||
Ms. Winfrey | |||||||||||||
Quarterly Financial Information [Line Items] | |||||||||||||
Impact of related party transaction expense on net income before of tax | 13,593 | ||||||||||||
Impact of related party transaction expense on net income net of tax | $ 8,292 | ||||||||||||
Impact of related party transaction expense per fully diluted share | $ 0.13 | ||||||||||||
Adjustments | |||||||||||||
Quarterly Financial Information [Line Items] | |||||||||||||
Net income attributable to Weight Watchers International, Inc. | $ 410 | $ 420 | $ 320 |
Valuation and Qualifying Acco91
Valuation and Qualifying Accounts and Reserves (Detail) - USD ($) $ in Thousands | 12 Months Ended | |||
Jan. 02, 2016 | Jan. 03, 2015 | Dec. 28, 2013 | ||
Allowance for doubtful accounts | ||||
Valuation and Qualifying Accounts Disclosure [Line Items] | ||||
Balance at Beginning of Period | $ 3,287 | $ 3,477 | $ 3,447 | |
Additions charged to Costs and Expenses | (446) | 99 | 596 | |
Additions charged to Other Accounts | 0 | 0 | 0 | |
Deductions | [1] | (615) | (289) | (566) |
Balance at End of Period | 2,226 | 3,287 | 3,477 | |
Inventory and other reserves | ||||
Valuation and Qualifying Accounts Disclosure [Line Items] | ||||
Balance at Beginning of Period | 7,107 | 5,859 | 6,942 | |
Additions charged to Costs and Expenses | 7,593 | 11,822 | 9,580 | |
Additions charged to Other Accounts | 0 | 0 | 0 | |
Deductions | [1] | (10,635) | (10,574) | (10,663) |
Balance at End of Period | 4,065 | 7,107 | 5,859 | |
Tax valuation allowance | ||||
Valuation and Qualifying Accounts Disclosure [Line Items] | ||||
Balance at Beginning of Period | 34,640 | 36,372 | 31,015 | |
Additions charged to Costs and Expenses | 1,056 | 3,183 | 3,821 | |
Additions charged to Other Accounts | (2,631) | 0 | 2,429 | |
Deductions | [1] | (4,785) | (4,915) | (893) |
Balance at End of Period | $ 28,280 | $ 34,640 | $ 36,372 | |
[1] | Primarily represents the utilization of established reserves, net of recoveries, where applicable. |