Numico board member potential GNC buyer

Related tags Gnc Board of directors Corporate governance Corporation

Numico said last week that board member Bill Watts is stepping down
from the board as he had expressed a potential interest in buying
its US chain GNC in partnership with a US venture capital firm. The
company says no decision has yet been taken.

Dutch infant nutrition maker Numico said on Friday that supervisory board member Bill Watts would step down from this position as he had expressed a potential interest in buying its US chain GNC in partnership with a US venture capital firm.

The company said however that no decision on a possible future divestment of GNC has yet been taken, although other media reports suggested that there have been several interested buyers.

Numico​, which announced the sale of another US unit Unicity in March, has previously hinted at the divestment of GNC, the largest US food supplement chain, which has failed to show growth over the last year. The company did however claim there were signs of recovery at GNC in its first quarter results, reported last week, with sales, excluding ephedra products and substitutes, at the same level as a year ago.

Both Baby Food and Clinical Nutrition had a good first quarter, with combined sales and EBITA growth of 6.7 per cent and 11.1 per cent respectively. But at other US units, the supplement manufacturer Rexall Sundown and Unicity, weak performance continued, not helped by losses from ephedra-related sales. Total net sales for the quarter declined 5.6 per cent to €863 million and total normalised EBITA was down by 23.7 per cent to €90 million.

CEO Jan Bennink said Numico would end the sale of all ephedra-containing products by the end of June 2003, and retained a positive outlook for the year.

"At the start of 2003, we see evidence of renewed momentum in our cores businesses, with solid sales of our continued operations and clear organisational responsiveness,"​ said Bennink, referring to healthy sales growth at the Baby Food and Clinical Nutrition divisions and "the first signs of recovery" at GNC.

He continued that progress was being made in its financial and strategic initiatives and divestment of non-core activities is on track.

"With this solid performance in the first quarter, we are confident that the combined sales and EBITA performance of Baby Food and Clinical Nutrition will - on a comparable basis - exceed the results of last year by 3-5 per cent. We also expect the full year EBITA of GNC (including the ephedra delisting) to remain positive,"​ added Bennink.

The world's biggest vitamin and food supplement maker also plans to appoint Hessel Lindenbergh (currently executive board member of the ING Group) to its supervisory board, it announced last week.

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