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Dec 31, 2022
Life Time Q4 2022 Earnings Report
Reported strong revenue growth driven by membership dues and in-center revenues, along with margin expansion efforts.
Key Takeaways
Life Time Group Holdings reported a strong fourth quarter and full-year fiscal 2022, with revenue increasing by 31.1% to $472.7 million compared to the previous year. The company's strategies, including strategic investments and pricing optimization, drove increased club usage and memberships. Net income was $13.7 million, a significant improvement compared to the net loss of $304.8 million in the same period last year.
Revenue increased due to strong growth in membership dues and in-center revenues.
Average monthly dues per center membership increased approximately 20% to $162.
Net center memberships declined approximately 3,500, consistent with typical seasonality.
Net income and Adjusted EBITDA improved significantly due to increased revenue and margin expansion efforts.
Life Time
Life Time
Life Time Revenue by Segment
Revenue by Segment
Membership Dues & Enrollment Fees Revenue
CapyFin.comIn-Center Revenue
CapyFin.com Forward Guidance
Life Time provided guidance for the first quarter and full-year 2023, including revenue, net income, and Adjusted EBITDA estimates. The company plans to open 10 new athletic country clubs in 2023 and expects full-year rent expense to include non-cash rent expense of $35 million to $40 million.
Positive Outlook
- Revenue for Q1 2023 is projected to be between $505 million and $510 million, representing a 29% increase compared to Q1 2022.
- Net income for Q1 2023 is expected to be between $10 million and $11 million, a significant improvement from the $(38) million loss in Q1 2022.
- Adjusted EBITDA for Q1 2023 is forecasted to be between $108 million and $110 million, a 166% increase compared to Q1 2022.
- Full-year 2023 revenue is projected to be between $2.2 billion and $2.3 billion, a 23% increase compared to 2022.
- Full-year 2023 Adjusted EBITDA is expected to be between $440 million and $460 million, a 60% increase compared to 2022.
Challenges Ahead
- Full-year 2023 rent expense is expected to be between $270 million and $280 million, including non-cash rent expense of $35 million to $40 million.
- The company is planning to execute sale-leaseback transactions to generate gross proceeds of $300 million.
- Targeting capital expenditures of $260 million to $280 million, net of the planned $300 million in sale-leaseback gross proceeds.
- Expect to achieve leverage of approximately four times net debt to adjusted EBITDA by year-end.
- Plan to open 10 athletic country clubs in 2023.
Revenue & Expenses
Visualization of income flow from segment revenue to net income