Apr 21 2011
Life Time Fitness, Inc. (NYSE:LTM), The Healthy Way of Life Company, today reported its financial results for the first quarter ended March 31, 2011.
“I am pleased with our first quarter operating results, which included strong top-line and in-center revenue expansion, and net income growth”
First quarter 2011 revenue grew 9.5% to $240.6 million from $219.8 million during the same period last year.
Net income for the quarter was $20.8 million, or $0.51 per diluted share, compared to net income of $17.8 million, or $0.44 per diluted share, for 1Q 2010. Non-GAAP net income for the quarter was $21.4 million, or $0.52 per diluted share. This non-GAAP net income excluded $1.0 million (pretax) of non-cash performance share-based compensation expense relating to a June 2009 grant of performance share-based restricted stock. This expense was recognized as a result of the Company's determination in 4Q 2010 that achieving certain 2011 diluted earnings per share performance criteria was probable and, if met, would result in the vesting of 50% of the stock.
"I am pleased with our first quarter operating results, which included strong top-line and in-center revenue expansion, and net income growth," said Bahram Akradi, chairman, president and chief executive officer. "Our results also reflect the ongoing progress we've made in driving our member experience and connectivity objectives. Our focus remains on growing our Healthy Way of Life Company by providing our members and customers with programs and services that are important to them both inside and outside of our health and fitness centers, all while delivering positive free cash flow and strengthening our balance sheet. Our business model is strong and the investments we currently are making further position us for long-term growth and success."
During the quarter, Life Time opened a large-format center in Syosset, New York, the first Life Time location in New York. In May, the Company plans to open its second and third large-format centers planned for 2011 in Colorado Springs, Colorado, and Summerlin, Nevada. These new centers will represent the fourth Life Time location in Colorado and first in the Las Vegas market.
Three Months Ended March 31, 2011, Financial Highlights:
Total revenue for the first quarter grew 9.5% to $240.6 million from $219.8 million.
Memberships grew 6.0% to 650,784 at March 31, 2011, from 613,882 at March 31, 2010.
- Quarterly attrition in 1Q 2011 was 8.4%, down from 8.5% in the prior-year period.
- Attrition for the trailing 12-month period ended March 31, 2011, was 36.1% compared to trailing 12-month attrition of 39.3% at March 31, 2010.
Total operating expenses during 1Q 2011 totaled $200.4 million compared to $182.1 million for 1Q 2010. Excluding the $1.0 million (pretax) of performance share-based compensation expense, 1Q 2011 operating expenses were $199.4 million.
- Operating margin was 16.7% for 1Q 2011 compared to 17.1% in the prior-year period.
- Excluding the performance share-based compensation expense, 1Q 2011 operating margin was 17.1%.
Net income for 1Q 2011 was $20.8 million, or $0.51 per diluted share, compared to net income of $17.8 million, or $0.44 per diluted share, for 1Q 2010.
Non-GAAP net income for the quarter, excluding the performance share-based compensation expense, was $21.4 million, or $0.52 per diluted share.
EBITDA for 1Q 2011 was $64.2 million compared with $60.7 million in 1Q 2010. As a percentage of total revenue, EBITDA in 1Q 2011 was 26.7% compared to 27.6% in 1Q 2010.
Adjusted EBITDA for the quarter, excluding performance share-based compensation expense, was $65.1 million. As a percentage of total revenue, adjusted EBITDA in 1Q 2011 was 27.1%.
Cash flows from operations for 1Q 2011 totaled $60.1 million compared to $53.9 million in 1Q 2010.
Weighted average fully diluted shares for 1Q 2011 totaled 40.9 million compared to 40.8 million in 1Q 2010.
Updated 2011 Business Outlook:
The following statements are based on the Company's current expectations for fiscal year 2011, which incorporate 2010 and early 2011 operating trends and are subject to the risks and uncertainties described below:
- Revenue is expected to increase 7-9%, or $980-995 million (up from 6-8%, or $970-990 million), driven primarily by growth in in-center revenue and corporate businesses, as well as membership growth in new and ramping centers.
- Net income is expected to increase 14-18%, or $92.0-95.0 million (updated from 13-18%, or $91.0-95.0 million), driven by revenue growth and cost efficiencies.
- Non-GAAP net income (excluding the impact of performance share-based compensation expense) is expected to be $94.5-97.5 million (updated from $93.5-97.5 million).
- Diluted earnings per common share is expected to be $2.21-2.29 (updated from $2.19-2.29).
- Non-GAAP diluted earnings per common share (excluding the impact of performance share-based compensation expense) is expected to be $2.27-2.35 (updated from $2.25-2.35).
SOURCE Life Time Fitness, Inc.