Life Time (US:LTH)2025-11-04 12:08Membership Growth - Total memberships reached over 891,000 as of September 30, 2025, with more than 1.6 million individual members[84] - Total memberships increased to 891,225 in Q3 2025, up from 876,509 in Q3 2024, representing a growth of 1.8%[104] Revenue Performance - Total center revenue rose to $2,182.4 million for the nine months ended September 30, 2025, up from $1,900.3 million in the same period of 2024[88] - Membership dues and enrollment fees for Q3 2025 reached $547,306, a 12.1% increase from $488,105 in Q3 2024[104] - In-center revenue for Q3 2025 was $213,591, up 14.4% from $186,670 in Q3 2024[104] - Total revenue for the three months ended September 30, 2025, increased by $89.4 million to $782.6 million compared to $693.2 million for the same period in 2024, driven by strong growth in membership dues and in-center revenue[118] - Center revenue rose by $86.1 million to $760.9 million for the three months ended September 30, 2025, compared to $674.8 million in 2024, with 68.7% from membership dues and enrollment fees[119][120] Profitability - Net income for Q3 2025 was $102,427, compared to $41,355 in Q3 2024, reflecting a significant increase of 147.5%[105] - Adjusted EBITDA for Q3 2025 was $220,046, a 22.0% increase from $180,293 in Q3 2024[109] - Net income for the three months ended September 30, 2025, was $102.4 million, significantly up from $41.4 million in 2024, reflecting a net income margin of 13.1%[129] - Net income for the nine months ended September 30, 2025, was $250.7 million, up from $119.1 million in the same period in 2024[142] Cash Flow and Liquidity - Free cash flow for the nine months ended September 30, 2025, was $216,369, compared to $247,054 for the same period in 2024[104] - Free cash flow for the three months ended September 30, 2025, was $62.5 million, down from $138.3 million in 2024, with net cash provided by operating activities at $251.1 million[112] - Net cash provided by operating activities for Q3 2025 was $251,112, an increase from $151,146 in Q3 2024[104] - Net cash provided by operating activities increased by $218.7 million, totaling $630.7 million for the nine months ended September 30, 2025[148] Operational Expansion - The company plans to open 12 to 14 new locations annually starting in 2026, with a focus on affluent markets[89] - The company opened 1 new center in Q3 2025, bringing the total to 185 centers, up from 177 centers at the end of Q3 2024[104] - New centers typically take three to four years to reach expected performance, with 30 centers open for less than three years and 17 under construction[88] - Life Time Work and Life Time Living concepts are expanding, with 15 and 4 locations open respectively as of September 30, 2025[93] Expenses and Costs - Operating expenses for the three months ended September 30, 2025, totaled $647.0 million, representing 82.6% of total revenue, compared to 86.4% in 2024[118] - General, administrative, and marketing expenses rose by $2.1 million to $59.8 million for the three months ended September 30, 2025, reflecting increased support for member services[123] - Rent expense increased by $8.9 million to $87.5 million for the three months ended September 30, 2025, primarily due to sale-leaseback transactions and higher contingent rent[122] - Rent expense increased by $26.1 million, primarily due to sale-leaseback transactions and higher contingent rent expenses[135] - Center operations expenses rose by $140.7 million due to costs associated with new and ramping centers and increased club utilization[134] Economic Factors - The company continues to monitor macroeconomic factors, including inflation and interest rates, but has not seen a material impact on its business[94] - Interest expense, net of interest income, decreased by $17.6 million to $18.4 million for the three months ended September 30, 2025, due to lower borrowings and interest rates[126] - Interest expense decreased by $45.8 million due to lower average borrowings and interest rates from swaps entered into in April 2025[139] Taxation - The effective tax rate for the three months ended September 30, 2025, was 26.5%, compared to 28.2% in 2024, influenced by state income tax provisions and share-based compensation deductions[128] Digital and Technology - The digital platform offers an integrated experience, including live streaming fitness classes and personalized AI-driven health recommendations[91]