June 23, 2020
WHAT DID GNC ANNOUNCE?
Our business has been under financial pressure for the past several years as we have worked to pay down debt and reposition GNC to be more competitive in a challenging operating environment. We were making significant progress and were focused on refinancing the business to allow us to position ourselves for long-term growth. However, the COVID-19 pandemic created a situation where we were unable to accomplish our refinancing and the abrupt change in the operating environment had a dramatic negative impact on our business.
As a result, we felt the best opportunity for us to continue to improve our capital structure and address certain operational issues was to restructure through a Chapter 11 reorganization. This gives us the opportunity to improve our balance sheet while continuing to advance our business strategy, right-size our corporate store portfolio, and strengthen our brands to protect the long-term sustainability of our company.
Over the past year, GNC has been executing a store portfolio optimization strategy to close underperforming stores, while doubling down on our omni-channel and brand strategies to better meet consumer demand. We believe that our strategy is sound, and the success we’ve seen thus far makes us confident we’re moving our business in the right direction. The Chapter 11 process will allow us to accelerate these strategies and invest in the appropriate areas to evolve in the future, while improving our capital structure and balance sheet.
1. How does this announcement impact customers?
GNC remains open for business and we fully expect to continue bringing our consumers the highest-quality, most-trusted health, wellness and performance products to help them live well, longer. GNC continues to serve consumers through our retail stores in many areas and we are offering safe and convenient curbside pick-up at shopping plaza locations. We are always available to provide you with solutions for our customers at GNC.com
2. Will my local GNC store remain open?
GNC continues to serve consumers through our retail stores in many areas and we are offering safe and convenient curbside pick-up at shopping plaza locations. Stores that are closed as a result of COVID-19 will reopen in accordance with government guidelines as quickly and safely as possible.
As part of our restructuring, we expect to accelerate the closure of at least 800 to 1,200 stores in our portfolio, many of which were previously announced with the process underway. By doing so, we will be exiting unfavorable lease terms burdening our business more quickly and shifting resources to our standalone store locations where we are seeing significantly more consumer foot traffic. We will communicate specific updates around potential closures as we progress in the Chapter 11 process. While select corporate stores will eventually close, we encourage you to seek out one of our other store locations in your area. Please note that even closing stores may remain open for a period of time.
3. Will I still be able to use my loyalty reward points?
We fully intend to uphold benefits for our loyalty and Pro Membership customers. We have filed a customary motion that, pending court approval, will ensure your loyalty points are still valid and will continue to accrue towards cash back rewards that can be redeemed in store or online at gnc.com.
4. Will by Pro Membership benefits be impacted?
We fully intend to uphold benefits for our loyalty and Pro Membership customers, and expect to continue to enhance them over the coming months. Additionally, we intend to resume normally scheduled Pro Box subscription deliveries in August.
5. Will my gift card retain its full value?
6. Should I expect changes in pricing or promotions?
7. Can I still return/exchange my items?
Our regular return policy is in effect. All products are refundable/exchangeable within 30 days from the date of your order from GNC.com or payment made in a GNC store with a valid sales receipt or GNC.com packing slip.