Life Time Fitness sells properties to pay down debt; downgraded by analyst
According to a filing with the SEC, Life Time Fitness' (NYSE: LTM) real estate business has sold properties in Arizona and Maryland for $60.5 million and will use the proceeds to pay down debt.
It will continue to lease the properties it sold to the buyer, a limited liability company affiliated with W.P. Carey & Co.
Additionally, Rochdale Research said it cut Life Time Fitness to "sell" from "hold," based on its leveraged balance sheet, high capital requirements and fixed costs.
"With the recent turmoil of the global credit markets, we think the odds are increasingly likely that the U.S. is in the early stages of a consumer downturn," analyst Jaison Blair wrote in a client note.
The company, which went public in 2004, is yet untested as a public entity and has shown early signs of weakness due to slowing consumer spending on discretionary purchases such as health club memberships, massages and personal training sessions, Blair continued.
Life Time Fitness will be further hurt by worsening housing fundamentals in its core cities and the increasing tightening of credit, he added. Blair has a price target of $22.50 on the company's stock.
CEO of Foot Locker's US division resigns
Richard T. Mina, who had been president and CEO of Foot Locker's U.S. division (NYSE: FL) since 2003, has resigned, according to a company filing with the SEC.
As a result of the management changes, the role of president and CEO will be effectively eliminated, it said.
Ron Halls, president and CEO of Foot Locker Inc.'s international division, has assumed added responsibilities for Champs Sports, Global Sourcing and Team Edition.
John Shanley, an analyst at Susquehanna Financial Group, wrote in a report that Mina's departure was likely the result of "difficulties that the executive has had over the past year with both managing the line executives that reported to him as well as persistent problems he had working with the key vendors of the company's U.S. operations."
"We believe the company has a significant depth of management talent that should more than offset any issues that arise due to Mr. Mina's departure," Shanley wrote.
Finish Line names new CEO
The Finish Line (Nasdaq: FINL) reported that Glenn S. Lyon will serve as CEO and replace Alan H. Cohen, who retires on Dec. 1.
Lyon, who currently serves as president, will also join the company's board. Lyon joined the company in 2001 as executive vice president and chief merchandising officer.
Steven Schneider, who has served as chief operating officer since 2003, will assume the role of president. Schneider joined Finish Line in 1989 as the company's chief financial officer.
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