HEALTH

GNC reports 2008 financial results

BY Michael Johnsen

PITTSBURGH General Nutrition Centers on Thursday reported revenue of $1.7 billion for the year ended Dec. 31, an increase of 6.7%. Same-store sales improved 2.7% in domestic company-owned stores, the specialty retailer reported.

EBITDA totaled $212.2 million for 2008, up 69.1%.

Revenue across GNC’s manufacturing and wholesale increased 10.8% for the year to $179.4 million.

“The growth in this segment was the result of increased third party sales and additional license fee revenue for Rite Aid’s store-within-a-store openings,” said GNC CFO Michael Nuzzo.

Rite Aid continued to expand its GNC store-within-a-store concept, adding a net 30 stores this quarter, Nuzzo said, bringing the total number of GNC/Rite Aid locations to 1,712, up from 1,358 stores last year.

Rite Aid is planning to open another 200 GNC storefronts this year. “We’ve been in constant touch with them on things as we work through the year, and we’re trying to partner with them, to help them in any way we can,” Joseph Fortunato, GNC CEO, told analysts Thursday. “We’re in discussions on some things right now, and I’m not free to really disclose them. But I think they are fairly firm in that they’re going to try to hold their commitments with us,” he said, responding to an analyst’s question on whether or not Rite Aid had shut down its GNC expansion plans.

At year end, operated 2,774 company-owned stores in the United States and Canada and had 954 domestic franchise locations, in addition to 1,712 Rite-Aid locations and 1,190 international franchise locations for a total of 6,630 locations globally.

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Abbott launches campaign with VH1’s Save The Music Foundation

BY Michael Johnsen

COLUMBUS, Ohio Abbott on Thursday launched the “live.create.” campaign around its ZonePerfect Nutrition Bars, partnering with the VH1 Save The Music Foundation in support of instrumental music programs in public schools.

“The VH1 Save The Music Foundation applauds the ZonePerfect team for choosing music education as the core of its efforts to support the arts, as we work toward our goal of bringing music and creativity into the curriculum of every public school in our nation,” stated Paul Cothran, executive director of the VH1 Save The Music Foundation.

The year-long partnership will help raise awareness for the Foundation with donations coming from ZonePerfect Nutrition Bar consumers. With every UPC code entered from a single bar, the makers of ZonePerfect will donate $0.05 and for every multi-pack carton UCP code, $0.50 will be donated to the VH1 Save The Music Foundation, for a total donation of $120,000. Each code serves as an automatic sweepstakes entry to ZonePerfect’s Win a Trip for Two to the 2009 VH1 Save The Music Foundation Gala in New York City. The donation will assist in the Foundation’s efforts to purchase instruments for schools in need of music education programs.

As part of the campaign, beginning in March, during Music in Our Schools Month, the ZonePerfect brand will make stops in 12 cities and hold special music and arts events at the “live.create.” lounge from March 14 – 21 at the 2009 South by Southwest Festivals and Conferences in Austin, Texas, and another at Film Independent’s 2009 Los Angeles Film Festival from June 19 – 27. The “live.create.” lounge in Austin and Los Angeles will each showcase a signature VH1 Save The Music Foundation music event, featuring emerging artists and local student musicians who’ve benefited from Foundation-funded programs.

Ten additional tour stops are scheduled for spring and summer 2009, including events at the Seattle International Film Festival, the Chicago Blues Festival in Grant Park and Denver’s Cherry Creek Arts Festival, and will feature performances with local musicians.

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NAD to Novartis: Modify or discontinue advertising claims for Extra-Strength Excedrin

BY Michael Johnsen

NEW YORK The National Advertising Division of the Council of Better Business Bureaus on Wednesday recommended that Novartis modify or discontinue certain advertising claims for Extra-Strength Excedrin.

NAD examined claims that Novartis’ Extra-Strength Excedrin provided pain relief in as quickly as 15 minutes, based on a challenge from Wyeth. NAD examined evidence that included a study provided by Novartis on subjects who took either Extra Strength Excedrin or a placebo. NAD determined that the evidence demonstrated that while some consumers may feel some relief in fifteen minutes, most consumers will not experience perceptible relief in that short of a time period.

NAD recommended that the advertiser either discontinue the claim or substantially modify it to reflect the results of its study — that some people, not most, will experience some relief in as little as 15 minutes.

“Novartis respectfully disagrees with the NAD’s decision as to how consumers interpret its express claim ‘Start[s] relieving your headache in just fifteen minutes,’” the company stated in its response to NAD.

Novartis has reported it will appeal certain NAD findings to the National Advertising Review Board.

NAD, the advertising industry’s self-regulatory forum, examined broadcast advertising for the product following a challenge by Wyeth, a manufacturer of competing pain relief products.

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