Bally grows '02 revenues 14 percent, tightens belt for '03 - SNEWS

Bally grows '02 revenues 14 percent, tightens belt for '03

In 2002, Bally Total Fitness Holding Corp. (NYSE: BFT) increased net revenues by 14 percent to $968.1 million from $852.0 million in the prior year, but the club says growth and expansion will be tempered in 2003.
Author:
Updated:
Original:

In 2002, Bally Total Fitness Holding Corp. (NYSE: BFT) increased net revenues by 14 percent to $968.1 million from $852.0 million in the prior year, including 9 percent attributable to the Crunch Fitness acquisition completed at the end of 2001.

Same club net revenues grew 3 percent, driven by increases in monthly membership dues and products and services, offset by a decline in new member initiation fees. Earnings before interest, taxes, depreciation and amortization, including finance charges earned ("EBITDA") before special charges were $201.7 million for 2002, a decline of 2 percent from the prior year.

Net income before special charges was $58.4 million or $1.77 per diluted share, versus net income before the net benefit of unusual items of $72.4 million in 2001, or $2.43 per diluted share.

"The past year produced strong growth in our personal training business and our membership dues, which were offset by a disappointing decrease in new member sign-ups at our same clubs," said Paul Toback, president and CEO, in a statement. "We believe the softness in membership originations was due, in large part, to the challenging economy and increased competition. We have already aggressively begun to address these issues for 2003 through enhanced marketing and advertising strategies. These strategies are designed to make Bally more competitive and highlight our key service strengths, such as providing personal training with more memberships, while focusing on our new Weight Management Program and the expanded offering of more flexible membership options. We intend to leverage these new ideas to grow our core business with improved new membership sales."

In a statement, Bally said it has no commitments to acquire clubs or real estate during 2003, and spending on club remodels and expansions is expected to significantly decline. New club spending is not expected to exceed $25 million for 2003, and club improvements should be less than or equal to the 2002 level. Administrative and systems spending will also decline significantly resulting from the completion of the new club management system.

"We have a tough job ahead of us," Toback said, "but much of the groundwork has already been laid and we are confident that the results of this plan will be strong."

SNEWS View: Not that the outlook is dim. It isn't. But things aren't as rosy either as belt-tightening hits the expanding Bally empire. Perhaps there was too much expansion, too quickly.

Related

Bally Total Fitness reports revenues up 16 percent, EBITDA down 4 percent

Bally Total Fitness Holding Corporation (NYSE: BFT) has reported net revenues up 16 percent over last year for the 3rd quarter of 2002. Revenues reached $243.1 million for the quarter. During the quarter, comparable club revenue grew 4 percent, driven primarily by increases in ...read more

Reebok reports 200-percent improved income 4th Q '02

For the fourth quarter of 2002, Reebok International Ltd. (NYSE: RBK) reported net income of $16 million, or 27 cents per diluted share, up 200 percent when compared to net income of $5.1 million, or 9 cents per diluted share for the same period last year. Net sales for the ...read more

Bally faces shareholder class-action suit after revenue restatement

Bally Total Fitness Holding Corp. is facing an investigation by the U.S. Securities and Exchange Commission and a shareholder class-action lawsuit after issuing a restatement of its revenues since 1997 when it released its 2003 results on March 11, 2004. As of June 3, 10 law ...read more

GSI Commerce's Q3 net revenue up 79 percent

Formerly known as Global Sports, GSI Commerce (Nasdaq: GSIC), an outsource provider for e-commerce and the company that runs etail for the likes of Sports Chalet and Bally Total Fitness, reported that its third quarter net revenue for 2002 was $32.3 million, representing a 79 ...read more

TSI increases revenues 3rd Q by 13 percent

Town Sports International (TSI) has announced revenues for the quarter ended Sept. 30, 2002, of $81.8 million, an increase of $9.4 million, or 13 percent over the same quarter of 2001. During the quarter, TSI's mature clubs (those in operation for 24 months or longer) experienced ...read more

Fitness financial: Bally looking to sell or merge amid flurry of restatement disclosures

Deluging inboxes everywhere with notices of SEC filings (20 last week alone), Bally Total Fitness (NYSE: BFT) finally released all of its back financial statements for fiscal 2004 and 2005 and restated earnings going back to 2000, as well as held its first earnings call in nearly ...read more

Rumors fly about whether a Bally sale is pending

Sometimes the only place to go when you've reached the top is down. That could be the case for Bally Total Fitness Holdings Corp. (NYSE: BFT) as reports continue to swirl around the company and its stock-piling troubles. Last week, financial news service The Daily Deal reported ...read more

Cybex shows higher 4th Q sales, lower total '02 sales

Only two weeks before its much bally-hoed splash at the IHRSA show (where we hear its booth may take up a city block. Or two.), Cybex has announced fourth quarter sales for 2002 were up by $2.33 million -- from $22,381,000 in the prior year to $24,711,000 for the year ended Dec. ...read more

Fitness financials: Bally seeks another extension on financial statements

The dark cloud hanging over Bally Total Fitness (NYSE: BFT) is still looking like a slow-moving storm front. While its memberships rose slightly, according to operating highlights of its first quarter 2005 and five months ended May 31, 2005, the company is also seeking a 90-day ...read more