Medifast said its net income more than doubled and sales grew 4%. Revenue from its Take Shape for Life MLM coaching unit rose 10%, which made up for lower sales from the company’s web site and phone orders and from company owned stores and wholesale physicians. The company has 86 corporate-owned locations and said Tuesday that it will sell them, transitioning to a franchise model.
It expects to complete the sales over the next year to 18 months.
Medifast net income grew to $7.1 million, or 51 cents per share, from $2.8 million, or 20 cents per share. Revenue rose to $97.1 million from $93.6 million. Analysts were expecting net income of 51 cents per share and $101.3 million in revenue.
The company said it still expects to earn between $1.70 and $1.80 per share in 2013, but it now forecasts $375 million to $385 million in revenue. Medifast’s last guidance called for $385 million to $400 million in revenue.
Considering the market condition and competitors’ results, Medifast did not do badly. However, for a company used to reporting 20% top line sale gains, this definitely shows a slowdown, to an expected 6-7% for 2013.