Lifetime Fitness 2010 Annual Report Download - page 80

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74
Quarterly Results (Unaudited)
Our quarterly operating results may fluctuate significantly because of several factors, including the timing of new
center openings and related expenses, timing of price increases for enrollment fees and membership dues and
general economic conditions.
In the past, our pre-opening costs, which primarily consist of compensation and related expenses, as well as
marketing, have varied significantly from quarter to quarter, primarily due to the timing of center openings. In
addition, our compensation and related expenses as well as our operating costs in the beginning of a center’s
operations are greater than what can be expected in the future, both in aggregate dollars and as a percentage of
membership revenue. Accordingly, the volume and timing of new center openings in any quarter have had, and are
expected to continue to have, an impact on quarterly pre-opening costs, compensation and related expenses and
occupancy and real estate costs. Due to these factors, results for a quarter may not indicate results to be expected for
any other quarter or for a full fiscal year.
2010 2009
1st
Quarter
2nd
Quarter
3rd
Quarter
4th
Quarter
1st
Quarter
2nd
Quarter
3rd
Quarter
4th
Quarter
(In thousands, except for number of centers and per share data)
Total revenue ......... $219,771 $231,088 $238,312 $223,673 $206,434 $212,549 $214,320 $203,698
Income from
operations ............. 37,642 42,924 45,588 34,605 32,503 38,270 39,982 38,106
Net income............. 17,836 21,884 23,378 17,594 15,114 18,260 20,633 18,377
Earnings per share
Basic (1) ............. $ 0.45 $ 0.55 $ 0.59 $ 0.44 $ 0.39 $ 0.46 $ 0.52 $ 0.47
Diluted (1) .......... $ 0.44 $ 0.53 $ 0.57 $ 0.43 $ 0.38 $ 0.46 $ 0.51 $ 0.46
Net cash provided
by (used in):
Operating
activities ......... $ 53,875 $ 46,833 $ 45,439 $ 46,118 $ 49,660 $ 48,624 $ 40,267 $ 47,652
Investing
activities ......... (22,749) (34,571) (41,139) (50,575) (50,386) (40,428) (24,766) (27,705)
Financing
activities ......... (24,453) (1,207) 5,192 (16,818) 473 (7,967) (18,169) (21,802)
EBITDA (2) ........... $ 60,708 $ 66,445 $ 69,292 $ 63,414 $ 54,904 $ 61,237 $ 63,726 $ 61,066
Free cash flow (3) .. $ 30,836 $ 21,708 $ 7,471 $ 579 $ 760 $ 5,799 $ 15,139 $ 17,873
Annual attrition
rate (4).................. 39.3% 38.2% 37.1% 36.3% 42.7% 41.5% 40.6% 40.6%
Centers open at
end of quarter (5) . 87 88 89 89 83 84 84 84
(1) The basic and diluted earnings per share by quarter include the impact of rounding within each quarter.
(2) EBITDA is a non-GAAP measure which consists of net income plus interest expense, net, provision for
income taxes and depreciation and amortization. EBITDAR adds rent expense to EBITDA. These terms, as we
define them, may not be comparable to a similarly titled measures used by other companies and are not
measures of performance presented in accordance with GAAP. We use EBITDA and EBITDAR as measures
of operating performance. EBITDA or EBITDAR should not be considered as a substitute for net income, cash
flows provided by operating activities or other income or cash flow data prepared in accordance with GAAP.
The funds depicted by EBITDA and EBITDAR are not necessarily available for discretionary use if they are
reserved for particular capital purposes, to maintain debt covenants, to service debt or to pay taxes. Additional
details related to EBITDA and EBITDAR are provided in “Management’s Discussion and Analysis of
Financial Condition and Results of Operations — Non-GAAP Financial Measures.”