Life Time Sees Double-Digit Growth in Profits, Revenue
Life Time Fitness, Inc., saw double-digit growth in both its fourth-quarter and full-year 2012 profits, the company announced Thursday.
The Chanhassen-based company said those increases were driven by a boost in club membership; strong same-store sales, or sales at clubs open for at least 13 months; and a boost in revenue per member—meaning in addition to paying their monthly dues, members are increasingly buying the company’s ancillary services, such as personal training and weight-loss programs.
For the quarter that ended December 31, net income totaled $23.4 million, or 56 cents per share, up 18.1 percent from $19.8 million, or 48 cents per share, for the same quarter a year earlier. Revenue for the quarter increased nearly 10 percent to $275.3 million.
Fourth-quarter earnings came in just above expectations; analysts polled by Thomson Reuters expected the company to earn 55 cents per share.
For all of 2012, net income totaled $111.5 million, or $2.66 per share, up 20.4 percent from $92.6 million, or $2.26 per share, in 2011. Revenue for the year grew 11.2 percent to $1.1 billion.
“Looking ahead, we are positioning our company for top-line growth through center expansion, new membership and programming initiatives, and expanded products and services,” Life Time CEO Bahram Akradi said in a statement.
Life Time, which in recent years has opened three new clubs per year, plans to accelerate that pace in 2014 with at least six club openings that year. It has three club openings planned for 2013, including its first location in Alabama. The company now has about 105 clubs across the United States and in Canada.
The company said its revenue per member grew 4.7 percent in 2012. Life Time’s total number of members grew 1 percent year-over-year to 682,621 at the end of 2012. But excluding memberships acquired in connection with its 2011 acquisition of Florida-based Lifestyle Family Fitness, memberships grew 2.4 percent, it said. Meanwhile, same-store sales grew 4.3 percent during 2012.
The company last year opened its first Canada fitness center in Mississauga, Ontario, in addition to opening its first Oklahoma location in Tulsa and its fifth Atlanta location.
In 2011, Life Time hit $1 billion in annual revenue for the first time in its history. Sales increased 11 percent that year, and profits rose 14.8 percent to $92.6 million.
The company also made at least two acquisitions last year: Atlanta-based Racquet Club of the South, a deal that made it the largest operator of indoor tennis courts in the country, and the assets of MGC Diagnostics Corporation’s New Leaf business unit, which provides metabolic assessment data.
Life Time is one of Minnesota’s 30 largest public companies based on revenue. Its founder, Akradi, was inducted into Twin Cities Business’ Minnesota Business Hall of Fame last year. To read his profile in the July issue, click here.