Life Time, Chanhassen, Minnesota, reported third quarter 2022 revenue of $496.4 million, a 28.9 percent increase compared to third quarter 2021, the company announced on Nov. 9. It projects that its full-year 2022 revenue will total between $1.81 billion and $1.84 billion compared to full-year 2021 revenue of $1.318 billion. Despite that projected increase in 2022 revenue, Life Time will still fall short of its 2019 revenue, which was $1.9 billion.
"While the macro-economic background remains a headwind, our strategy of playing offense to enhance the member experience and drive our revenue recovery and growth is working, and we are swiftly turning our focus to margin expansion,” Life Time Founder, Chairman and CEO Bahram Akradi said in the announcement. “We see significant opportunities to continue improving our margins by capturing operating leverage as we continue to grow revenue, optimizing the execution of our key strategic initiatives, continuing our price optimization and driving efficiencies across our club and corporate structure.”
For the fourth quarter, Life Time expects revenue between $460 million and $490 million, up from $360.5 million in fourth quarter 2021. Fourth quarter EBITDA is anticipated to be $80 million to $90 million. Full-year EBITDA is anticipated between $255 million and $265 million.
Life Time continued its sale-leaseback deals, completing five of those in the quarter for gross proceeds of $200 million. For the nine-month period ending Sept. 30, aggregate proceeds from sale-leaseback transactions were approximately $375 million.
The company is exploring alternative sale-leaseback structures to optimize its financing cost and preserve the utilization of its net operating losses to offset its growing future taxable income.
Life Time opened three new centers in the quarter, totaling 156 open facilities at the end of the quarter. For the year, Life Time projects it will have opened 12 new athletic resorts, and it plans to open 11 more in 2023, Akradi said.
For the quarter, Life Time reported memberships at 728,729, a 9 percent increase from the same period last year and an increase of 4,000 compared to June 30.
Comparable center sales increased 25.6 percent in the third quarter.
Net income was $24.7 million and included a tax-effected gain of $42.7 million from sale-leasebacks, and $5.1 million in tax-effected non-cash share-based compensation expense.
Adjusted EBITDA increased 50.9 percent to $71 million from $47 million.
Life Time’s total cash and cash equivalents at the end of the quarter totaled $107.1 million with no outstanding borrowings under its $475 million revolving credit facility.