Life Time earnings growth beats expectations

Article by: MARISSA EVANS , Star Tribune
Updated: July 21, 2011 - 7:56 PM

The fitness chain benefited by adding services. Shares rose 8 percent.

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Life Time Fitness executives say they have focused on building up services to increase member retention.

Photo: David Joles, Star Tribune

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Life Time Fitness Inc. reported second-quarter earnings Thursday that beat analysts' expectations, as customers spent more on an increased variety of programs.

The Chanhassen-based fitness company said net income grew 14 percent to $24.9 million, or 61 cents a share. That was ahead of the consensus analyst expectation of 58 cents, according to Bloomberg News.

Revenue grew 11 percent to $256.7 million, as the company brought in 9 percent more in membership dues than a year earlier.

Executives say they have focused on building up services to increase member retention and satisfaction. "In-center" revenue beyond membership fees has grown from $102 per member in 2009 to $124 in the second quarter.

Revenue per membership was up 4.7 percent from a year earlier at $389.

Life Time Fitness shares rose $3.10, or 8 percent, to $43.29.

Life Time Chief Executive Bahram Akradi said the company plans to continue to beef up its programs.

"That strategy is to offer the absolute best programs for every group, every interest group whether just they are interested in basketball, yoga, running cycling, etc.," Akradi said in a conference call.

Marissa Evans • 612-673-4211