附录99.1
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生活时报报告2024年第三季度财务结果
•总营业收入为69320万美元，较上一年同期增加18.5%。
•净利润为4140万美元，较上年同季增加422.5%。
•调整后的净利润为5630万美元，较前一年同期增加110.9%。
•调整后的EBITDA为18,030万美元，较上一年同期增加26.1%。
•摊薄后每股收益从去年同期的0.04美元增加至0.19美元
•将净债务杠杆比降至2.4倍
•提供正面净现金流，并在售后租赁回买交易之前提供自由现金流
明尼苏达州CHANHASSEN（2024年10月24日） Life Time Group Holdings，Inc.（“Life Time”，“我们”，“我们的”，“我们”或“公司”）（纽交所：LTH）今天宣布截至2024年9月30日的第三财季财务业绩。
巴哈拉姆·阿克拉迪，创始人、董事长兼首席执行官，表示： “在取得另一个季度强劲的财务表现后，我们对我们业务的实力和发展轨迹保持自信。在第三季度，我们继续降低杠杆至2.5倍以下，再次从营运活动中获得大量现金，实现了在售后租回收益之前的正面自由现金流。随著我们的股权发行完成并完成债务再融资，我们现在更有利位置，可以继续利用眼前的重大机遇来发展业务。我要感谢所有我们的团队成员，感谢他们对打造一家更强大、更庞大且更出色的公司所展现的热情和奉献精神。”
财务摘要
| 结束于三个月的期间 | 九个月结束了 | ||||||||||||||||||||||||||||||||||
| （单位：百万美元，除会员数和每位会员数据外） | 九月三十日， | 九月三十日， | |||||||||||||||||||||||||||||||||
| 2024 | 2023 | 百分比变动量 | 2024 | 2023 | 百分比变动量 | ||||||||||||||||||||||||||||||
| 营业总收入 | $693.2 | $585.2 | 18.5% | $1,957.7 | $1,657.8 | 18.1% | |||||||||||||||||||||||||||||
| 中心运营费用 | $371.1 | $319.4 | 16.2% | $1,048.5 | $896.1 | 17.0% | |||||||||||||||||||||||||||||
| 租金 | $78.6 | $69.2 | 13.5% | $225.8 | $203.2 | 11.1% | |||||||||||||||||||||||||||||
总部、行政和市场营销费用 (1) | $57.7 | $51.7 | 11.7% | $159.8 | $147.0 | 8.7% | |||||||||||||||||||||||||||||
| 净利润 | $41.4 | $7.9 | 422.5% | $119.1 | $52.4 | 127.3% | |||||||||||||||||||||||||||||
| 净利润调整后 | $56.3 | $26.7 | 110.9% | $140.2 | $91.1 | 53.9% | |||||||||||||||||||||||||||||
| 调整后的税前利润减除折旧及摊销后的费用 | $180.3 | $143.0 | 26.1% | $499.8 | $399.1 | 25.2% | |||||||||||||||||||||||||||||
可比中心营业收入 (2) | 12.1% | 11.4% | 11.8% | 16.6% | |||||||||||||||||||||||||||||||
| 中心会员数，期末 | 826,502 | 784,331 | 5.4% | 826,502 | 784,331 | 5.4% | |||||||||||||||||||||||||||||
| 每个中心会员的中心平均营业收入 | $815 | $722 | 12.9% | $2,361 | $2,095 | 12.7% | |||||||||||||||||||||||||||||
(1) 截至2024年和2023年9月30日的三个月，分别包括1030万美元和1340万美元的非现金股份报酬费用。截至2024年和2023年9月30日的九个月，分别包括2710万美元和3290万美元的非现金股份报酬费用。
(2) 公司在中心运营的第13个完整日历月的第一天开始，将一个中心纳入，以便评估中心在运营一年后的增长率。
2024年第三季度资讯
•营业收入增加了18.5% 至6.932亿美元，原因是由于持续强劲的会费和中心收入增长，平均会费的增加，我们新建的中心和投入使用中心提供的服务的会员增长。
•与2023年9月30日相比，中心的会员数增加了42,171人，增长了5.4％，并且2024年第二季度与季节性预期一致下降了约6,100人，降至826,502人。
•总订阅数，其中包括中心会员数和我们的数位留存会员数，比较2023年9月30日增加了5.6％至876,509。
•中心运营费用增加了16.2%达37110万美元，主要是由于我们新建和扩张中心相关的运营成本增加，以及支持会员数增长和中心业务收入增长的成本。
•总务、行政和营销费用增加了11.7％，达到$ 5770万，主要是由于现金奖励酬金和相关福利支出增加、信息科技成本以及中心支持总部开支的提升，旨在增强和扩大我们的会员服务和体验，部分抵消了较低的股份报酬支出。
•净利润由于业务表现提升，以及本期税后一次性净损由售后租回交易减少$300万到$3.14亿，再加上本年度税后一次性$0.5亿的土地出售盈利，较去年同期税后一次性损失$3.3亿有所增加，增加了$3350万。.8 本期税后一次性净损由售后租回交易减少$300万，并且本年度税后一次性盈利$50万来自售卖土地，相比于去年同期的税后一次性损失$330万。
•调整后的净利润增加了2960万至5630万。
•经调整的净利润和经调整的EBITDA显著改善，因为我们经历了营业收入增加的较大流量，并受益于改善我们业务结构的结构性改进，进而改善了我们的利润率。
2024年九个月资讯
•营业收入增加了18.1%。 达1,957.7百万美元，因持续强劲的会费和中心营收增长，平均会费增加，我们新中心和渐增中心的会员增长，以及会员更多地利用我们中心提供的服务。
•中心运营支出增加了17.0%，达到10.48亿美元，主要是由于与我们的新中心和扩张中心相关的运营成本增加，以及支持会员数增长和中心业务营业收入的成本。
•总部、行政和市场营销费用增加了8.7%，达1.598亿美元，主要是因为现金激励薪酬和福利相关费用增加、资讯科技成本增加、中心支援总部开支增加，以增强和扩展我们的会员服务和体验，以及与我们新俱乐部开幕相关的市场营销费用的时间，部分抵销了较低的股份报酬费用。
•净利润增加了$6670万至$11910万，主要是由于业务表现的改善，以及较小程度地因本年度土地销售产生的$370万税后一次性净收益和卖回租赁交易中$200万的税后一次性净收益，相较于前一年期间卖回租赁交易产生的$1000万税后一次性净亏损和土地出售中的$420万税后一次性净亏损。前一年期间的净利润还包括对两次铁人三项活动出售所得的$350万税后一次性利润。
•调整后的净利润增加了4910万美元，至14020万美元。
•经调整的净利润和经调整的EBITDA显著改善，因为我们经历了营业收入增加的较大流量，并受益于改善我们业务结构的结构性改进，进而改善了我们的利润率。
新中心开幕
•第三季我们开设了两家新中心。
•截至2024年9月30日，我们共经营了177个中心。
现金流亮点
•营运活动提供的净现金增加了31.8％，达到$15110万。
•我们实现了自由现金流13830万美元，其中约6500万美元来自出售及租回交易的净收益。
•我们的资本支出按支出类型如下：
| Three Months Ended | Nine Months Ended | ||||||||||||||||||||||||||||||||||
| ($ in millions) | September 30, | September 30, | |||||||||||||||||||||||||||||||||
| 2024 | 2023 | Percent Change | 2024 | 2023 | Percent Change | ||||||||||||||||||||||||||||||
Growth capital expenditures (1) | $46.4 | $131.9 | (64.8)% | $259.9 | $368.8 | (29.5)% | |||||||||||||||||||||||||||||
Maintenance capital expenditures (2) | $21.6 | $29.7 | (27.3)% | $70.0 | $81.8 | (14.4)% | |||||||||||||||||||||||||||||
Modernization and technology capital expenditures (3) | $19.1 | $31.3 | (39.0)% | $58.3 | $79.3 | (26.5)% | |||||||||||||||||||||||||||||
| Total capital expenditures | $87.1 | $192.9 | (54.8)% | $388.2 | $529.9 | (26.7)% | |||||||||||||||||||||||||||||
(1) Consist of new center land and construction, initial major remodels of acquired centers, major remodels of existing centers that expand existing square footage, asset acquisitions including the purchase of previously leased centers and other growth initiatives.
(2) Consist of general maintenance of existing centers.
(3) Consist of modernization of existing centers and technology.
Liquidity and Capital Resources
•As of September 30, 2024, our total available liquidity was $529.7 million, which included availability on our $650.0 million revolving credit facility and cash and cash equivalents.
•Our net debt leverage ratio improved to 2.4x as of September 30, 2024, from 3.7x as of September 30, 2023.
•We completed sale-leaseback transactions on two properties for net proceeds of approximately $65.0 million.
•We completed an equity offering of 6.0 million primary shares resulting in net proceeds of $124.4 million. We used a portion of these net proceeds to pay down an aggregate principal amount of $110.0 million of our former term loan facility. We also upsized and extended our revolving credit facility and paid the remaining aggregate principal amount of $200.0 million of our former term loan facility and no borrowings remained outstanding thereunder.
2024 Outlook
Full-Year 2024 Guidance
| Percent | Year Ended | ||||||||||||||||||||||
| Year Ended | Year Ended | Change | December 31, 2024 | ||||||||||||||||||||
| December 31, 2024 | December 31, 2023 | (Using | (Guidance as of | ||||||||||||||||||||
| ($ in millions) | (Guidance) | (Actual) | Midpoints) | August 1, 2024) | |||||||||||||||||||
| Revenue | $2,595 – $2,605 | $2,216.6 | 17.3% | $2,560 – $2,590 | |||||||||||||||||||
Net Income (1) | $138 – $140 | $76.1 | 82.7% | $142 – $148 | |||||||||||||||||||
| Adjusted EBITDA | $658 – $662 | $536.8 | 23.0% | $642 – $652 | |||||||||||||||||||
| Rent | $305 – $310 | $275.1 | 11.8% | $300 – $312 | |||||||||||||||||||
(1) Includes approximately $15 million of estimated one-time interest expense related to the refinancing of our senior secured and unsecured notes.
Conference Call Details
A conference call to discuss our third quarter financial results is scheduled for today:
•Date: Thursday, October 24, 2024
•Time: 10:00 a.m. ET (9:00 a.m. CT)
•U.S. dial-in number: 1-877-451-6152
•International dial-in number: 1-201-389-0879
•Webcast: LTH 3Q 2024 Earnings Call
A link to the live audio webcast of the conference call will be available at https://ir.lifetime.life.
Replay Information
Webcast – A recorded replay of the webcast will be available within approximately three hours of the call’s conclusion and may be accessed at: https://ir.lifetime.life.
Conference Call – A replay of the conference call will be available after 1:00 p.m. ET the same day through November 7, 2024:
•U.S. replay number: 1-844-512-2921
•International replay number: 1-412-317-6671
•Replay ID: 1374 9346
# # #
About Life Time
Life Time (NYSE: LTH) empowers people to live healthy, happy lives through its portfolio of more than 175 athletic country clubs across the United States and Canada. The health and wellness pioneer also delivers a range of healthy way of life programs and information via its complimentary Life Time Digital app. The Company’s healthy living, healthy aging, healthy entertainment communities and ecosystem serve people 90 days to 90+ years old and is supported by a team of more than 41,000 dedicated professionals. In addition to delivering the best programs and experiences through its clubs, Life Time owns and produces nearly 30 of the most iconic athletic events in the country.
Use of Non-GAAP Financial Measures and Key Performance Indicators
This press release includes certain financial measures that are not presented in accordance with generally accepted accounting principles in the United States (“GAAP”), including Adjusted net income, Adjusted net income per common share, Adjusted EBITDA, free cash flow and net debt and ratios and calculations with respect thereto. These non-GAAP financial measures are not based on any comprehensive set of accounting rules or principles and should be considered in addition to, and not as a substitute for or superior to, net income, net income per common share, net cash provided by operating activities or total debt (defined as long-term debt, net of current portion, plus current maturities of debt) as a measure of financial performance or liquidity or any other performance measure derived in accordance with GAAP, and should not be construed as an inference that the Company’s future results will be unaffected by unusual or non-recurring items. In addition, these non-GAAP financial
measures should be read in conjunction with the Company’s financial statements prepared in accordance with GAAP. The reconciliations of the Company’s non-GAAP financial measures to the corresponding GAAP measures should be carefully evaluated.
Adjusted net income is defined as net income excluding the impact of share-based compensation expense as well as (gain) loss on sale-leaseback transactions, capital transaction costs, legal settlements, asset impairment, severance and other items that are not indicative of our ongoing operations, less the tax effect of these adjustments. Adjusted EBITDA is defined as net income before interest expense, net, provision for income taxes and depreciation and amortization, excluding the impact of share-based compensation expense as well as (gain) loss on sale-leaseback transactions, capital transaction costs, legal settlements, asset impairment, severance and other items that are not indicative of the Company’s ongoing operations. Free cash flow is defined as net cash provided by operating activities less capital expenditures, net of construction reimbursements, plus net proceeds from sale-leaseback transactions and land sales. Net debt is defined as long-term debt, net of current portion, plus current maturities of debt, excluding fair value adjustments, unamortized debt discounts and issuance costs, minus cash and cash equivalents. Net debt is as of the last day of the respective quarter or year. Our net debt leverage ratio is calculated as our net debt divided by our trailing twelve months of Adjusted EBITDA.
The Company presents these non-GAAP financial measures because management believes that these measures assist investors and analysts in comparing the Company’s operating performance across reporting periods on a consistent basis by excluding items that management does not believe are indicative of the Company’s ongoing operating performance, and management believes that free cash flow assists investors and analysts in evaluating our liquidity and cash flows, including our ability to make principal payments on our indebtedness and to fund our capital expenditures and working capital requirements. Investors are encouraged to evaluate these adjustments and the reasons the Company considers them appropriate for supplemental analysis. In evaluating the non-GAAP financial measures, investors should be aware that, in the future, the Company may incur expenses that are the same as or similar to some of the adjustments in the Company’s presentation of its non-GAAP financial measures. There can be no assurance that the Company will not modify the presentation of non-GAAP financial measures in future periods, and any such modification may be material. In addition, the Company’s non-GAAP financial measures may not be comparable to similarly titled measures used by other companies in the Company’s industry or across different industries.
The non-GAAP financial measures have limitations as analytical tools, and investors should not consider these measures in isolation or as substitutes for analysis of the Company’s results as reported under GAAP.
Forward-Looking Statements
This press release includes “forward-looking statements” within the meaning of federal securities regulations. Forward-looking statements in this press release include, but are not limited to, the Company’s plans, strategies and prospects, both business and financial, including its financial outlook for full year 2024, growth, cost efficiencies and margin expansion, improvements to its balance sheet, net debt and leverage ratio, capital expenditures and free cash flow, consumer demand, industry and economic trends, taxes, and rent expense. These statements are based on the beliefs and assumptions of the Company’s management. Forward-looking statements are inherently subject to risks, uncertainties and assumptions. Generally, statements that are not historical facts, including statements concerning the Company’s possible or assumed future actions, business strategies, events or results of operations, are forward-looking statements. These statements may be preceded by, followed by or include the words “believe,” “expect,” “anticipate,” “intend,” “plan,” “estimate” or similar expressions. In addition, any statements or information that refer to expectations, beliefs, plans, projections, objectives, performance or other characterizations of future events or circumstances, including any underlying assumptions, are forward-looking.
Factors that could cause actual results to differ materially from those forward-looking statements included in this press release include, but are not limited to, risks relating to our business operations and competitive and economic environment, risks relating to our brand, risks relating to the growth of our business, risks relating to our technological operations, risks relating to our capital structure and lease obligations, risks relating to our human capital, risks relating to legal compliance and risk management and risks relating to ownership of our common stock and the other important factors discussed under the caption “Risk Factors” in the Company’s Annual Report on Form 10-K for the year ended December 31, 2023, filed with the Securities and Exchange Commission (the “SEC”) on February 28, 2024, (File No. 001-40887), as such factors may be updated from time to time in the Company’s other filings with the SEC, which are accessible on the SEC’s website at www.sec.gov. These and other important factors could cause actual results to differ materially from those indicated by the forward-looking statements made in this press release. Any forward-looking statement that the Company makes in this press release speaks only as of the date of such statement. Except as required by law, the Company does not have any obligation to update or revise, or to publicly announce any update or revision to, any of the forward-looking statements, whether as a result of new information, future events or otherwise.
Contacts:
Investors
Ken Cooper, Investor Relations // kcooper2@lt.life or 952-406-2322
Media
Jason Thunstrom, Corporate Communications // jthunstrom@lt.life or 952-229-7435
LIFE TIME GROUP HOLDINGS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share data)
(Unaudited)
| Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
| 2024 | 2023 | 2024 | 2023 | ||||||||||||||||||||
| Revenue: | |||||||||||||||||||||||
| Center revenue | $ | 674,775 | $ | 568,402 | $ | 1,900,267 | $ | 1,608,279 | |||||||||||||||
| Other revenue | 18,459 | 16,775 | 57,445 | 49,480 | |||||||||||||||||||
| Total revenue | 693,234 | 585,177 | 1,957,712 | 1,657,759 | |||||||||||||||||||
| Operating expenses: | |||||||||||||||||||||||
| Center operations | 371,134 | 319,401 | 1,048,544 | 896,113 | |||||||||||||||||||
| Rent | 78,575 | 69,225 | 225,804 | 203,196 | |||||||||||||||||||
| General, administrative and marketing | 57,737 | 51,668 | 159,836 | 147,005 | |||||||||||||||||||
| Depreciation and amortization | 69,451 | 63,618 | 205,068 | 180,067 | |||||||||||||||||||
| Other operating expense | 22,642 | 34,516 | 47,952 | 64,837 | |||||||||||||||||||
| Total operating expenses | 599,539 | 538,428 | 1,687,204 | 1,491,218 | |||||||||||||||||||
| Income from operations | 93,695 | 46,749 | 270,508 | 166,541 | |||||||||||||||||||
| Other (expense) income: | |||||||||||||||||||||||
| Interest expense, net of interest income | (36,011) | (33,075) | (111,083) | (96,249) | |||||||||||||||||||
| Equity in (loss) earnings of affiliates | (116) | 56 | (403) | 287 | |||||||||||||||||||
| Total other expense | (36,127) | (33,019) | (111,486) | (95,962) | |||||||||||||||||||
| Income before income taxes | 57,568 | 13,730 | 159,022 | 70,579 | |||||||||||||||||||
| Provision for income taxes | 16,213 | 5,815 | 39,945 | 18,200 | |||||||||||||||||||
| Net income | $ | 41,355 | $ | 7,915 | $ | 119,077 | $ | 52,379 | |||||||||||||||
| Income per common share: | |||||||||||||||||||||||
| Basic | $ | 0.20 | $ | 0.04 | $ | 0.60 | $ | 0.27 | |||||||||||||||
| Diluted | $ | 0.19 | $ | 0.04 | $ | 0.57 | $ | 0.26 | |||||||||||||||
| Weighted-average common shares outstanding: | |||||||||||||||||||||||
| Basic | 202,945 | 196,146 | 199,793 | 195,404 | |||||||||||||||||||
| Diluted | 214,633 | 204,298 | 207,841 | 203,954 | |||||||||||||||||||
LIFE TIME GROUP HOLDINGS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands, except per share data)
(Unaudited)
| September 30, 2024 | December 31, 2023 | ||||||||||
| ASSETS | |||||||||||
| Current assets: | |||||||||||
| Cash and cash equivalents | $ | 120,947 | $ | 11,161 | |||||||
| Restricted cash and cash equivalents | 16,106 | 18,805 | |||||||||
| Accounts receivable, net | 26,230 | 23,903 | |||||||||
| Center operating supplies and inventories | 59,237 | 52,803 | |||||||||
| Prepaid expenses and other current assets | 41,374 | 57,751 | |||||||||
| Income tax receivable | 5,298 | 10,101 | |||||||||
| Total current assets | 269,192 | 174,524 | |||||||||
| Property and equipment, net | 3,095,145 | 3,171,616 | |||||||||
| Goodwill | 1,235,359 | 1,235,359 | |||||||||
| Operating lease right-of-use assets | 2,335,206 | 2,202,601 | |||||||||
| Intangible assets, net | 171,917 | 172,127 | |||||||||
| Other assets | 72,840 | 75,914 | |||||||||
| Total assets | $ | 7,179,659 | $ | 7,032,141 | |||||||
| LIABILITIES AND STOCKHOLDERS’ EQUITY | |||||||||||
| Current liabilities: | |||||||||||
| Accounts payable | $ | 70,592 | $ | 81,252 | |||||||
| Construction accounts payable | 61,562 | 108,730 | |||||||||
| Deferred revenue | 48,836 | 49,299 | |||||||||
| Accrued expenses and other current liabilities | 196,290 | 185,305 | |||||||||
| Current maturities of debt | 12,439 | 73,848 | |||||||||
| Current maturities of operating lease liabilities | 67,016 | 58,764 | |||||||||
| Total current liabilities | 456,735 | 557,198 | |||||||||
| Long-term debt, net of current portion | 1,639,752 | 1,859,027 | |||||||||
| Operating lease liabilities, net of current portion | 2,401,711 | 2,268,863 | |||||||||
| Deferred income taxes, net | 77,657 | 56,066 | |||||||||
| Other liabilities | 42,004 | 36,875 | |||||||||
| Total liabilities | 4,617,859 | 4,778,029 | |||||||||
| Stockholders’ equity: | |||||||||||
Common stock, $0.01 par value per share; 500,000 shares authorized; 206,613 and 196,671 shares issued and outstanding, respectively. | 2,066 | 1,967 | |||||||||
| Additional paid-in capital | 3,025,445 | 2,835,883 | |||||||||
| Accumulated deficit | (457,736) | (576,813) | |||||||||
| Accumulated other comprehensive loss | (7,975) | (6,925) | |||||||||
| Total stockholders’ equity | 2,561,800 | 2,254,112 | |||||||||
| Total liabilities and stockholders’ equity | $ | 7,179,659 | $ | 7,032,141 | |||||||
LIFE TIME GROUP HOLDINGS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)
(Unaudited)
| Nine Months Ended September 30, | |||||||||||
| 2024 | 2023 | ||||||||||
| Cash flows from operating activities: | |||||||||||
| Net income | $ | 119,077 | $ | 52,379 | |||||||
| Adjustments to reconcile net income to net cash provided by operating activities: | |||||||||||
| Depreciation and amortization | 205,068 | 180,067 | |||||||||
| Deferred income taxes | 21,693 | 15,994 | |||||||||
| Share-based compensation | 30,450 | 37,029 | |||||||||
| Non-cash rent expense | 25,181 | 26,900 | |||||||||
| Impairment charges associated with long-lived assets | 2,941 | 6,620 | |||||||||
| (Gain) loss on disposal of property and equipment, net | (6,548) | 13,742 | |||||||||
| Write-off of debt discounts and issuance costs | 3,510 | — | |||||||||
| Amortization of debt discounts and issuance costs | 5,891 | 5,862 | |||||||||
| Changes in operating assets and liabilities | 1,794 | (4,407) | |||||||||
| Other | 2,919 | (3,240) | |||||||||
| Net cash provided by operating activities | 411,976 | 330,946 | |||||||||
| Cash flows from investing activities: | |||||||||||
| Capital expenditures | (388,213) | (529,965) | |||||||||
| Proceeds from sale-leaseback transactions | 207,714 | 121,831 | |||||||||
| Proceeds from the sale of land | 15,577 | 4,169 | |||||||||
| Other | 2,819 | 416 | |||||||||
| Net cash used in investing activities | (162,103) | (403,549) | |||||||||
| Cash flows from financing activities: | |||||||||||
| Proceeds from borrowings | — | 44,291 | |||||||||
| Repayments of debt | (408,612) | (11,202) | |||||||||
| Proceeds from revolving credit facility | 1,045,000 | 986,000 | |||||||||
| Repayments of revolving credit facility | (925,000) | (961,000) | |||||||||
| Repayments of finance lease liabilities | (626) | (771) | |||||||||
| Proceeds from financing obligations | 4,300 | 1,500 | |||||||||
| Payments of debt discounts and issuance costs | (1,873) | (2,550) | |||||||||
| Proceeds from the issuance of common stock, net of issuance costs | 124,357 | — | |||||||||
| Proceeds from stock option exercises | 19,548 | 14,897 | |||||||||
| Proceeds from issuances of common stock in connection with the employee stock purchase plan | 1,462 | 1,450 | |||||||||
| Other | (1,304) | (110) | |||||||||
| Net cash (used in) provided by financing activities | (142,748) | 72,505 | |||||||||
| Effect of exchange rates on cash and cash equivalents and restricted cash and cash equivalents | (38) | 30 | |||||||||
| Increase (decrease) in cash and cash equivalents and restricted cash and cash equivalents | 107,087 | (68) | |||||||||
| Cash and cash equivalents and restricted cash and cash equivalents—beginning of period | 29,966 | 25,509 | |||||||||
| Cash and cash equivalents and restricted cash and cash equivalents—end of period | $ | 137,053 | $ | 25,441 | |||||||
Non-GAAP Measurements and Key Performance Indicators
See “Use of Non-GAAP Financial Measures and Key Performance Indicators” for a discussion of the Non-GAAP financial measures reconciled below.
Key Performance Indicators
($ in thousands, except for Average Center revenue per center membership)
(Unaudited)
| Three Months Ended | Nine Months Ended | ||||||||||||||||||||||
| September 30, | September 30, | ||||||||||||||||||||||
| 2024 | 2023 | 2024 | 2023 | ||||||||||||||||||||
| Membership Data | |||||||||||||||||||||||
| Center memberships | 826,502 | 784,331 | 826,502 | 784,331 | |||||||||||||||||||
| Digital on-hold memberships | 50,007 | 45,708 | 50,007 | 45,708 | |||||||||||||||||||
| Total memberships | 876,509 | 830,039 | 876,509 | 830,039 | |||||||||||||||||||
| Revenue Data | |||||||||||||||||||||||
| Membership dues and enrollment fees | 72.3 | % | 71.8 | % | 72.4 | % | 71.7 | % | |||||||||||||||
| In-center revenue | 27.7 | % | 28.2 | % | 27.6 | % | 28.3 | % | |||||||||||||||
| Total Center revenue | 100.0 | % | 100.0 | % | 100.0 | % | 100.0 | % | |||||||||||||||
| Membership dues and enrollment fees | $ | 488,105 | $ | 407,903 | $ | 1,376,212 | $ | 1,152,506 | |||||||||||||||
| In-center revenue | 186,670 | 160,499 | 524,055 | 455,773 | |||||||||||||||||||
| Total Center revenue | $ | 674,775 | $ | 568,402 | $ | 1,900,267 | $ | 1,608,279 | |||||||||||||||
Average Center revenue per center membership (1) | $ | 815 | $ | 722 | $ | 2,361 | $ | 2,095 | |||||||||||||||
Comparable center revenue (2) | 12.1 | % | 11.4 | % | 11.8 | % | 16.6 | % | |||||||||||||||
| Center Data | |||||||||||||||||||||||
Net new center openings (3) | 2 | 6 | 6 | 9 | |||||||||||||||||||
Total centers (end of period) (3) | 177 | 170 | 177 | 170 | |||||||||||||||||||
Total center square footage (end of period) (4) | 17,400,000 | 16,700,000 | 17,400,000 | 16,700,000 | |||||||||||||||||||
| GAAP and Non-GAAP Financial Measures | |||||||||||||||||||||||
| Net income | $ | 41,355 | $ | 7,915 | $ | 119,077 | $ | 52,379 | |||||||||||||||
Net income margin (5) | 6.0 | % | 1.4 | % | 6.1 | % | 3.2 | % | |||||||||||||||
Adjusted net income (6) | $ | 56,278 | $ | 26,684 | $ | 140,158 | $ | 91,139 | |||||||||||||||
Adjusted net income margin (6) | 8.1 | % | 4.6 | % | 7.2 | % | 5.5 | % | |||||||||||||||
Adjusted EBITDA (7) | $ | 180,293 | $ | 142,981 | $ | 499,816 | $ | 399,123 | |||||||||||||||
Adjusted EBITDA margin (7) | 26.0 | % | 24.4 | % | 25.5 | % | 24.1 | % | |||||||||||||||
| Center operations expense | $ | 371,134 | $ | 319,401 | $ | 1,048,544 | $ | 896,113 | |||||||||||||||
Pre-opening expenses (8) | $ | 1,164 | $ | 1,477 | $ | 4,819 | $ | 6,146 | |||||||||||||||
| Rent | $ | 78,575 | $ | 69,225 | $ | 225,804 | $ | 203,196 | |||||||||||||||
Non-cash rent expense (open properties) (9) | $ | 9,684 | $ | 8,409 | $ | 20,734 | $ | 25,662 | |||||||||||||||
Non-cash rent expense (properties under development) (9) | $ | 1,847 | $ | 861 | $ | 4,447 | $ | 1,238 | |||||||||||||||
| Net cash provided by operating activities | $ | 151,146 | $ | 114,655 | $ | 411,976 | $ | 330,946 | |||||||||||||||
Free cash flow (10) | $ | 138,332 | $ | (30,274) | $ | 247,054 | $ | (73,019) | |||||||||||||||
(1) We define Average Center revenue per center membership as Center revenue less Digital on-hold revenue, divided by the average number of Center memberships for the period, where the average number of Center memberships for the period is an average derived
from dividing the sum of the total Center memberships outstanding at the beginning of the period and at the end of each month during the period by one plus the number of months in each period.
(2) We measure the results of our centers based on how long each center has been open as of the most recent measurement period. We include a center, for comparable center revenue purposes, beginning on the first day of the 13th full calendar month of the center’s operation, in order to assess the center’s growth rate after one year of operation.
(3) Net new center openings is calculated as the number of centers that opened for the first time to members during the period, less any centers that closed during the period. Total centers (end of period) is the number of centers operational as of the last day of the period. During the three months ended September 30, 2024, we opened two centers.
(4) Total center square footage (end of period) reflects the aggregate square footage, excluding the areas used for tennis courts, outdoor swimming pools, outdoor play areas and stand-alone Work, Sport and Swim locations. We use this metric for evaluating the efficiencies of a center as of the end of the period. These figures are approximations.
(5) Net income margin is calculated as net income divided by total revenue.
(6) We present Adjusted net income as a supplemental measure of our performance. We define Adjusted net income as net income excluding the impact of share-based compensation expense as well as (gain) loss on sale-leaseback transactions, capital transaction costs, legal settlements, asset impairment, severance and other items that are not indicative of our ongoing operations, less the tax effect of these adjustments.
Adjusted net income margin is calculated as Adjusted net income divided by total revenue.
The following table provides a reconciliation of net income and income per common share, the most directly comparable GAAP measures, to Adjusted net income and Adjusted net income per common share:
| Three Months Ended | Nine Months Ended | ||||||||||||||||||||||
| September 30, | September 30, | ||||||||||||||||||||||
| ($ in thousands) | 2024 | 2023 | 2024 | 2023 | |||||||||||||||||||
| Net income | $ | 41,355 | $ | 7,915 | $ | 119,077 | $ | 52,379 | |||||||||||||||
Share-based compensation expense (a) | 11,752 | 14,858 | 30,450 | 37,029 | |||||||||||||||||||
Loss (gain) on sale-leaseback transactions (b) | 4,902 | 12,672 | (2,620) | 13,431 | |||||||||||||||||||
Legal settlements (c) | 1,250 | — | 1,250 | — | |||||||||||||||||||
Asset impairments (d) | — | 5,340 | — | 6,620 | |||||||||||||||||||
Other (e) | 2,869 | (312) | (927) | (4,852) | |||||||||||||||||||
Taxes (f) | (5,850) | (13,789) | (7,072) | (13,468) | |||||||||||||||||||
| Adjusted net income | $ | 56,278 | $ | 26,684 | $ | 140,158 | $ | 91,139 | |||||||||||||||
| Income per common share: | |||||||||||||||||||||||
| Basic | $ | 0.20 | $ | 0.04 | $ | 0.60 | $ | 0.27 | |||||||||||||||
| Diluted | $ | 0.19 | $ | 0.04 | $ | 0.57 | $ | 0.26 | |||||||||||||||
| Adjusted income per common share: | |||||||||||||||||||||||
| Basic | $ | 0.28 | $ | 0.14 | $ | 0.70 | $ | 0.47 | |||||||||||||||
| Diluted | $ | 0.26 | $ | 0.13 | $ | 0.67 | $ | 0.45 | |||||||||||||||
| Weighted-average common shares outstanding: | |||||||||||||||||||||||
| Basic | 202,945 | 196,146 | 199,793 | 195,404 | |||||||||||||||||||
| Diluted | 214,633 | 204,298 | 207,841 | 203,954 | |||||||||||||||||||
(a) Share-based compensation expense recognized during the three and nine months ended September 30, 2024, was associated with stock options, restricted stock units, performance stock units, our employee stock purchase plan (“ESPP”) that launched on December 1, 2022, and liability-classified awards related to our 2024 short-term incentive plan. Share-based compensation expense recognized during the three and nine months ended September 30, 2023, was associated with stock options, restricted stock units, our ESPP and liability-classified awards related to our 2023 short-term incentive plan.
(b) We adjust for the impact of gains and losses on the sale-leaseback of our properties as they do not reflect costs associated with our ongoing operations.
(c) We adjust for the impact of unusual legal settlements. These costs are non-recurring in nature and do not reflect costs associated with our normal ongoing operations.
(d) Represents non-cash asset impairments of our long-lived assets.
(e) Includes (i) a $3.5 million write-off of the unamortized debt discounts and issuance costs associated with the extinguishment of our former term loan facility and construction loan for the three and nine months ended September 30, 2024, (ii) (gain) loss on sales of land of $(0.6) million and $0.4 million for the three months ended September 30, 2024 and 2023, respectively, and $(5.0) million and $0.4 million for the nine months ended September 30, 2024 and 2023, respectively, and (iii) legal-related
expenses in pursuit of our claim against Zurich of $0.1 million for the three months ended September 30, 2023, and $0.6 million and $0.7 million for the nine months ended September 30, 2024 and 2023, respectively. For 2023, also includes a subsidy (credit) for our Canadian operations in connection with COVID-19 of $(0.3) million for the nine months ended September 30, 2023 and gain on sales of the Company’s triathlons and certain other assets of $(0.8) million and $(5.7) million for the three and nine months ended September 30, 2023, respectively.
(f) Represents the estimated tax effect of the total adjustments made to arrive at Adjusted net income using the effective income tax rates for the respective periods.
(7) We present Adjusted EBITDA as a supplemental measure of our performance. We define Adjusted EBITDA as net income before interest expense, net, provision for income taxes and depreciation and amortization, excluding the impact of share-based compensation expense as well as (gain) loss on sale-leaseback transactions, capital transaction costs, legal settlements, asset impairment, severance and other items that are not indicative of our ongoing operations.
Adjusted EBITDA margin is calculated as Adjusted EBITDA divided by total revenue.
The following table provides a reconciliation of net income, the most directly comparable GAAP measure, to Adjusted EBITDA:
| Three Months Ended | Nine Months Ended | ||||||||||||||||||||||
| September 30, | September 30, | ||||||||||||||||||||||
| ($ in thousands) | 2024 | 2023 | 2024 | 2023 | |||||||||||||||||||
| Net income | $ | 41,355 | $ | 7,915 | $ | 119,077 | $ | 52,379 | |||||||||||||||
| Interest expense, net of interest income | 36,011 | 33,075 | 111,083 | 96,249 | |||||||||||||||||||
| Provision for income taxes | 16,213 | 5,815 | 39,945 | 18,200 | |||||||||||||||||||
| Depreciation and amortization | 69,451 | 63,618 | 205,068 | 180,067 | |||||||||||||||||||
Share-based compensation expense (a) | 11,752 | 14,858 | 30,450 | 37,029 | |||||||||||||||||||
Loss (gain) on sale-leaseback transactions (b) | 4,902 | 12,672 | (2,620) | 13,431 | |||||||||||||||||||
Legal settlements (c) | 1,250 | — | 1,250 | — | |||||||||||||||||||
Asset impairments (d) | — | 5,340 | — | 6,620 | |||||||||||||||||||
Other (e) | (641) | (312) | (4,437) | (4,852) | |||||||||||||||||||
| Adjusted EBITDA | $ | 180,293 | $ | 142,981 | $ | 499,816 | $ | 399,123 | |||||||||||||||
(a) – (d) See the corresponding footnotes to the table in footnote 6 immediately above.
(e) Includes (i) (gain) loss on sales of land of $(0.6) million and $0.4 million for the three months ended September 30, 2024 and 2023, respectively, and $(5.0) million and $0.4 million for the nine months ended September 30, 2024 and 2023, respectively, and (ii) legal-related expenses in pursuit of our claim against Zurich of $0.1 million for the three months ended September 30, 2023, and $0.6 million and $0.7 million for the nine months ended September 30, 2024 and 2023, respectively. For 2023, also includes a subsidy (credit) for our Canadian operations in connection with COVID-19 of $(0.3) million for the nine months ended September 30, 2023 and gain on sales of the Company’s triathlons and certain other assets of $(0.8) million and $(5.7) million for the three and nine months ended September 30, 2023, respectively.
(8) Represents non-capital expenditures associated with opening new centers that are incurred prior to the commencement of a new center opening. The number of centers under construction or development, the types of centers and our costs associated with any particular center opening can vary significantly from period to period.
(9) Reflects the non-cash portion of our annual GAAP operating lease expense that is greater or less than the cash operating lease payments. Non-cash rent expense for our open properties represents non-cash expense associated with properties that were operating at the end of each period presented. Non-cash rent expense for our properties under development represents non-cash expense associated with properties that are still under development at the end of each period presented.
(10) Free cash flow, a non-GAAP financial measure, is calculated as net cash provided by operating activities less capital expenditures, net of construction reimbursements, plus net proceeds from sale-leaseback transactions and land sales.
The following table provides a reconciliation from net cash provided by operating activities to free cash flow:
| Three Months Ended | Nine Months Ended | ||||||||||||||||||||||
| September 30, | September 30, | ||||||||||||||||||||||
| ($ in thousands) | 2024 | 2023 | 2024 | 2023 | |||||||||||||||||||
| Net cash provided by operating activities | $ | 151,146 | $ | 114,655 | $ | 411,976 | $ | 330,946 | |||||||||||||||
| Capital expenditures, net of construction reimbursements | (87,106) | (192,889) | (388,213) | (529,965) | |||||||||||||||||||
| Proceeds from sale-leaseback transactions | 65,043 | 43,791 | 207,714 | 121,831 | |||||||||||||||||||
| Proceeds from land sales | 9,249 | 4,169 | 15,577 | 4,169 | |||||||||||||||||||
| Free cash flow | $ | 138,332 | $ | (30,274) | $ | 247,054 | $ | (73,019) | |||||||||||||||
Reconciliation of Net Income to Adjusted EBITDA Trailing Twelve Months
($ in thousands)
(Unaudited)
| Twelve | Twelve | ||||||||||
| Months Ended | Months Ended | ||||||||||
| September 30, 2024 | September 30, 2023 | ||||||||||
| Net income | $ | 142,761 | $ | 66,105 | |||||||
| Interest expense, net of interest income | 145,631 | 125,054 | |||||||||
| Provision for income taxes | 40,472 | 20,831 | |||||||||
| Depreciation and amortization | 269,398 | 237,270 | |||||||||
| Share-based compensation expense | 43,564 | 41,106 | |||||||||
| (Gain) loss on sale-leaseback transactions | (2,463) | 13,966 | |||||||||
| Legal settlements | 1,250 | — | |||||||||
| Asset impairments | — | 5,340 | |||||||||
| Other | (3,090) | (3,523) | |||||||||
| Adjusted EBITDA | $ | 637,523 | $ | 506,149 | |||||||
Reconciliation of Net Debt and Leverage Calculation
($ in thousands)
(Unaudited)
| Twelve | Twelve | ||||||||||
| Months Ended | Months Ended | ||||||||||
| September 30, 2024 | September 30, 2023 | ||||||||||
| Current maturities of debt | $ | 12,439 | $ | 64,033 | |||||||
| Long-term debt, net of current portion | 1,639,752 | 1,815,965 | |||||||||
| Total Debt | $ | 1,652,191 | $ | 1,879,998 | |||||||
| Less: Fair value adjustment | 323 | 682 | |||||||||
| Less: Unamortized debt discounts and issuance costs | (6,462) | (16,531) | |||||||||
| Less: Cash and cash equivalents | 120,947 | 9,199 | |||||||||
| Net Debt | $ | 1,537,383 | $ | 1,886,648 | |||||||
| Trailing twelve-month Adjusted EBITDA | 637,523 | 506,149 | |||||||||
| Net Debt Leverage Ratio | 2.4x | 3.7x | |||||||||
Reconciliation of Net Income to Adjusted EBITDA Guidance for 2024
($ in millions)
(Unaudited)
| Year Ended | |||||
| December 31, 2024 | |||||
| Net income | $138 – $140 | ||||
Interest expense, net of interest income (1) | 155 – 151 | ||||
| Provision for income taxes | 51 – 52 | ||||
| Depreciation and amortization | 272 – 275 | ||||
| Share-based compensation expense | 48 – 50 | ||||
| (Gain) on sale-leaseback transactions | (3) – (3) | ||||
| Other | (3) – (3) | ||||
| Adjusted EBITDA | $658 – $662 | ||||
(1) Includes approximately $15 million of estimated one-time interest expense related to the refinancing of our senior secured and unsecured notes.