Life Time Fitness 8-K Entry into a Material Definitive Agreement

Exhibit 99.1

Investor Contact: Michael Robinson – 952-229-7427 orir@lifetimefitness.com
Media Contact: Jason Thunstrom – 952-229-7435 orjthunstrom@lifetimefitness.com

FOR IMMEDIATE RELEASE

LIFE TIME FITNESS ANNOUNCES FOURTH QUARTER AND FULL-YEAR 2004 FINANCIAL RESULTS
Company Reports Revenue Growth of 22% and Net Income Growth of 54% for the Quarter;
Full-Year Revenue Grew 21% and Net Income Grew 40%

EDEN PRAIRIE, Minn. (February 17, 2005)– Life Time Fitness, Inc. (NYSE: LTM), a national operator of large and distinctive health and fitness centers, today reported its operating results for the fourth quarter and full year ended December 31, 2004.

     Fourth quarter 2004 revenue grew 22.4% to $82.1 million from $67.1 million during the same period last year. Revenue for the year totaled $312.0 million, up 21.4% from $256.9 million in 2003.

     Net income during the quarter grew 54.1% to $8.1 million, or $0.23 per diluted share on 35.9 million shares. This compares to net income of $5.3 million, or $0.18 per diluted share on 28.7 million shares, for 4Q 2003. For the year, net income grew 40.3% to $28.9 million, or $0.87 per diluted share on 33.1 million shares. This compares to net income of $20.6 million, or $0.72 per diluted share on 28.6 million shares, for 2003.

     “The Company’s fourth quarter and full-year results are indicative of the continued focus and execution on our fundamental growth strategies, including new center growth, membership ramp, and increasing in-center revenue,” said Bahram Akradi, Life Time Fitness chairman and chief executive officer. “In 2004, we opened a total of six new centers and we have acquired the land and commenced construction on the six new centers we plan to open in 2005. The fourth quarter included new openings in Sugar Land, our second Houston, Texas, location, and in Flower Mound, Colleyville and North Dallas, each of which is located in the Dallas, Texas market. We closed the year with a total of 39 open centers in eight states. Total memberships grew 20% year over year, ending with 299,538 memberships, driven primarily by the ramp at centers opened in 2003 and 2004. We also are pleased with the year-over-year in-center revenue growth of 30% to $18.2 million during Q4 2004, which was driven primarily by membership ramp, targeted marketing programs, and new products and services. We remain highly focused on delivering results and enhancing shareholder value.”

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Life Time Fitness Fourth Quarter and Full-Year 2004 Results – Page 2

Three and Twelve Months Ended December 31, 2004, Financial Highlights:
Total revenuefor the fourth quarter grew 22.4% to $82.1 million and for the full year total revenue grew 21.4% to $312.0 million, driven primarily by growth in membership dues and in-center revenue.

•   Membership dues revenue for the fourth quarter grew 21.5% to $56.2 million from $46.3 million in 4Q 2003. Membership dues revenue in 2004 grew 21.7% to $208.9 million from $171.6 million in 2003.

•   Enrollment fee revenue for the fourth quarter was $4.8 million, compared to $4.7 million in 4Q 2003. Full-year enrollment fee revenue totaled $19.6 million, compared to $19.2 million in 2003.

•   In-center revenue for the fourth quarter grew 30.2% to $18.2 million. In-center revenue in 2004 grew 28.7% to $71.6 million compared to $55.6 million in 2003.

•   Same-center revenue increased 7.9% during the fourth quarter compared to the prior-year period and increased 9.7% for the total year.

•   Total revenue per membership averaged $281 in the fourth quarter, up 2% from the prior-year period. Total in-center revenue per membership averaged $64 in the fourth quarter, up 8% from the prior-year period.

•   Other revenue for the fourth quarter, including media division advertising and nutritional products sales, totaled $2.8 million compared to $2.1 million in the prior-year period. Total year other revenue in 2004 was $11.9 million compared to $10.5 million in 2003.

Total operating expensesduring 4Q 2004 totaled $64.3 million compared to $53.4 million for 4Q 2003 and full year operating expenses were $246.5 million, compared to $203.0 million in 2003, driven primarily by increased expenses to support new centers, membership growth and presales activities. Total operating margins were 21.7% for the 4Q 2004, up from 20.4% in the prior-year period. Full year operating margins remained consistent at 21.0% compared to 2003.

•   Center operating expenses totaled $42.7 million for the 4Q 2004, compared to $35.2 million in 4Q 2003. Center operating expenses in 2004 totaled $164.8 million, compared to $131.8 million in 2003.

•   Advertising and marketing expenses totaled $2.9 million for 4Q 2004, compared to $3.1 million for the same period last year. 2004 advertising and marketing expenses totaled $12.2 million, compared to $11.0 million last year.

•   General and administrative expenses totaled $5.7 million for the fourth quarter, compared to $4.4 million in the prior-year period. For the total year, general and administrative expenses totaled $21.6 million, compared to $18.6 million in 2003.

•   Other operating expenses and depreciation and amortization expenses totaled $12.9 million during 4Q 2004, compared to $10.6 million in 4Q 2003. Total year expenses in the same areas were $47.9 million, compared to $41.5 million in 2003.

Net incomeduring 4Q 2004 grew 54.1% to $8.1 million from $5.3 million in 4Q 2003, driven by continued top-line growth, efficient use of capital and operating cost leverage.

•   For the total year, net income grew 40.3% to $28.9 million from $20.6 million in 2003.

•   Net income margin for 4Q 2004 was 9.9%, up from 7.9% in 4Q 2003. The net income margin in 2004 was 9.3%, up from 8.0% in 2003.

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Life Time Fitness Fourth Quarter and Full-Year 2004 Results – Page 3

EBITDAfor 4Q 2004 grew 26.3% to $26.3 million from $20.8 million in 4Q 2003.

•   2004 EBITDA grew 20.3% to $96.3 million from $80.0 million in 2003.

•   As a percentage of total revenue, EBITDA was 32.1% in 4Q 2004, up from 31.1% in 4Q 2003. EBITDA margin in 2004 was 30.8% compared to 31.1% in 2003.

Cash flows from operationsfor the full year grew 54.2% to $81.1 million from $52.6 million in 2003.

     Weighted average fully diluted shares for the fourth quarter totaled 35.9 million, which recognizes the full impact of our initial public offering, which closed on July 6, 2004. For the full year, weighted average fully diluted shares totaled 33.1 million.

2005 Business Outlook:
The following statements are based on the Company’s expectations for fiscal year 2005, subject to the risks and uncertainties described below.

•   2005 full-year total revenue is expected to grow 20-22%, driven by new center growth, membership ramp at new and existing centers, and in-center revenue growth.

•   2005 full-year net income is expected to grow 28-30%, driven by our growth strategies, combined with operating efficiencies and general and administrative expense leverage.

•   2005 diluted earnings per share are expected to grow 18-21%, driven by net income growth and offset by the increase in annual weighted average diluted shares resulting from the initial public offering in 2004.

     The 2005 guidance excludes any impact of stock option expense. The Company will begin expensing stock options as compensation costs in the second half of 2005. Currently, the Company discloses the effect on net income and earnings per share related to expensing of options as a note to its consolidated financial statements. The Company will provide an estimated impact of this change in accounting principle in guidance later in the year.

     As announced on January 26, 2005, the Company will hold a conference call today at 10:00 a.m. Eastern time to discuss fourth quarter and full-year 2004 results. Bahram Akradi, chairman and chief executive officer, and Michael Robinson, executive vice president and chief financial officer, will host the conference call. The conference call will be Web cast and may be accessed via the Company’s Investor Relations section of its Website atwww.lifetimefitness.com. A replay of the call will be available via the Company’s Website beginning at 1:00 p.m. Eastern time on February 17, 2005.

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Life Time Fitness Fourth Quarter and Full-Year 2004 Results – Page 4

About Life Time Fitness, Inc.
     Life Time Fitness, Inc. (NYSE: LTM) operates distinctive and large sports and athletic, professional fitness, family recreation and resort/spa centers. As of February 17, 2005, the Company operated 39 centers in eight states, including Arizona, Illinois, Indiana, Michigan, Minnesota, Ohio, Texas and Virginia. The Company also provides consumers with nutritional products and supplements, the award-winning healthy lifestyle magazine, Experience Life, world-class athletic events, full-service spas, cafés, personal training consultation, health and nutrition education, and corporate wellness programs. Life Time Fitness is headquartered in Eden Prairie, Minnesota (www.lifetimefitness.com).

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     LIFE TIME FITNESS and EXPERIENCE LIFE are registered trademarks of Life Time Fitness, Inc. All other trademarks or registered trademarks are the property of their respective owners.

Risk & Uncertainties
     Certain information contained in this press release, which does not relate to historical financial information, including the business outlook, may be deemed to constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements are subject to certain risks and uncertainties that could cause the Company’s actual results in the future to differ materially from its historical results and those presently anticipated or projected. The Company wishes to caution investors not to place undue reliance on any such forward-looking statements. Any forward-looking statement speaks only as of the date on which such statement is made, and the Company undertakes no obligation to update such statement to reflect events or circumstances arising after such date. Among these factors are identifying and acquiring suitable sites for new sports and athletic, professional fitness, family recreation and resort/spa centers, opening new centers, attracting and retaining members and other factors set forth in the Company’s filings with the Securities and Exchange Commission. Net earnings per share could also be affected by the number of shares outstanding, which depends on factors such as the number of shares issued upon exercise of stock options and future grants of awards pursuant to equity-based incentive plans.

     All remarks made during the Company’s financial results conference call will be current at the time of the call and the Company undertakes no obligation to update the replay.

LIFE TIME FITNESS, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands)

	December 31,
	2004			2003
ASSETS:
Current assets:
Cash and cash equivalents	$	10,211		$	18,446
Accounts receivable, net		1,187			1,217
Inventories		4,971			4,654
Prepaid expenses and other current assets		7,275			6,977
Deferred membership origination costs		8,271			7,363
Deferred tax asset		2,577			5,368
Income tax receivable		4,579			2,547
Total current assets		39,071			46,572
Property and equipment, net		503,690			379,193
Restricted cash		12,092			10,972
Deferred membership origination costs		7,061			5,942
Other assets		11,153			10,667
Total assets	$	573,067		$	453,346
LIABILITIES AND SHAREHOLDERS’ EQUITY:
Current liabilities:
Current maturities of long-term debt	$	47,477		$	18,278
Accounts payable		5,762			6,171
Construction accounts payable		17,633			6,522
Accrued expenses		20,132			13,105
Deferred revenue		20,019			17,836
Total current liabilities		111,023			61,912
Long-term debt, net of current portion		161,767			214,954
Deferred rent liability		3,678			2,660
Deferred income taxes		33,701			23,196
Deferred revenue		12,264			11,667
Total liabilities		322,433			314,389
Redeemable preferred stock		—			106,165
Shareholders’ equity:
Undesignated preferred stock		—			—
Common stock		676			323
Additional paid-in capital		209,931			17,714
Deferred compensation		(66	)		—
Retained earnings		40,093			14,755
Total shareholders equity		250,634			32,792
Total liabilities and shareholders’ equity	$	573,067		$	453,346

LIFE TIME FITNESS, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands except per share data)

	For the						For the
	Three Months Ended						Year Ended
	December 31,						December 31,
	2004			2003			2004			2003
	(Unaudited)
REVENUE:
Membership dues	$	56,232		$	46,289		$	208,893		$	171,596
Enrollment fees		4,843			4,712			19,608			19,198
In-center revenue		18,179			13,959			71,583			55,633
Total center revenue		79,254			64,960			300,084			246,427
Other revenue		2,835			2,100			11,949			10,515
Total revenue		82,089			67,060			312,033			256,942
OPERATING EXPENSES:
Sports, fitness and family recreation center operations		42,716			35,244			164,764			131,825
Advertising and marketing		2,904			3,117			12,196			11,045
General and administrative		5,745			4,409			21,596			18,554
Other operating		4,669			3,699			18,256			16,273
Depreciation and amortization		8,248			6,890			29,655			25,264
Total operating expenses		64,282			53,359			246,467			202,961
Income from operations		17,807			13,701			65,566			53,981
OTHER INCOME (EXPENSE):
Interest expense, net		(4,227	)		(4,812	)		(17,573	)		(19,132	)
Equity in earnings of affiliate		257			245			1,034			762
Total other income (expense)		(3,970	)		(4,567	)		(16,539	)		(18,370	)
INCOME BEFORE INCOME TAXES		13,837			9,134			49,027			35,611
Provision for income taxes		5,691			3,849			20,119			15,006
NET INCOME		8,146			5,285			28,908			20,605
Accretion on redeemable preferred stock		—			1,761			3,570			6,987
NET INCOME APPLICABLE TO COMMON SHAREHOLDERS	$	8,146		$	3,524		$	25,338		$	13,618
BASIC EARNINGS PER SHARE	$	0.24		$	0.22		$	1.02		$	0.85
DILUTED EARNINGS PER SHARE	$	0.23		$	0.18		$	0.87		$	0.72
WEIGHTED AVERAGE NUMBER OF COMMON SHARES OUTSTANDING — BASIC		33,771			16,111			24,727			16,072
WEIGHTED AVERAGE NUMBER OF COMMON SHARES OUTSTANDING — DILUTED		35,909			28,711			33,125			28,612

LIFE TIME FITNESS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)

	For the
	Year ended December 31,
	2004			2003
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income	$	28,908		$	20,605
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization		29,655			25,264
Deferred income taxes		13,296			9,722
Loss on disposal of property, net		711			745
Amortization of deferred financing costs		1,599			1,053
Tax benefit from exercise of stock options		870			216
Compensation cost related to stock options and restricted stock		268			—
Changes in operating assets and liabilities		5,746			(5,029	)
Net cash provided by operating activities		81,053			52,576
CASH FLOWS FROM INVESTING ACTIVITIES
Purchases of property and equipment (excluding non-cash purchases supplementally noted below)		(156,674	)		(41,315	)
Increase (decrease) in construction accounts payable		11,112			(2,834	)
Proceeds from sale of property		2,139			23,740
Increase in other assets		(2,416	)		(2,495	)
Increase in restricted cash		(1,120	)		(1,572	)
Net cash used in investing activities		(146,959	)		(24,476	)
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from long-term borrowings		44,852			1,925
Repayments on long-term borrowings		(68,986	)		(18,119	)
Proceeds from initial public offering, net		80,498			—
Increase in deferred financing costs		315			(2,731	)
Proceeds from exercise of stock options		992			411
Net cash provided by (used in) financing activities		57,671			(18,514	)
INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS		(8,235	)		9,586
CASH AND CASH EQUIVALENTS — Beginning of period		18,446			8,860
CASH AND CASH EQUIVALENTS — End of period	$	10,211		$	18,446
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION:
Cash payments for interest, net of capitalized interest	$	17,105		$	17,821
Cash payments for income taxes	$	8,986		$	7,107
SUPPLEMENTAL SCHEDULE OF NON-CASH INVESTING AND FINANCING ACTIVITIES:
Property and equipment purchases financed through notes payable	$	—		$	28,668
Property and equipment purchases financed through capital leases	$	145		$	11,863
Property and equipment debt paid directly from sale proceeds	$	—		$	22,309

Non-GAAP Financial Measures

     This release contains a non-GAAP disclosure, EBITDA, which consists of net income plus interest expense, net, provision for income taxes and depreciation and amortization. This term, as the Company defines it, may not be comparable to a similarly titled measure used by other companies and is not a measure of performance presented in accordance with GAAP. The Company uses EBITDA as a measure of operating performance. The funds depicted by EBITDA are not necessarily available for discretionary use if they are reserved for particular capital purposes, to maintain compliance with debt covenants, to service debt or to pay taxes. EBITDA should not be considered as a substitute for net income, cash flows provided by operating activities or other income or cash flow data prepared in accordance with GAAP. Additional details related to EBITDA are provided in the Form 8-K that the Company filed with the Securities and Exchange Commission on the date of this press release.

     The following table provides a reconciliation of net income, the most directly comparable GAAP measure, to EBITDA:

LIFE TIME FITNESS, INC.
RECONCILIATION OF NET INCOME TO EARNINGS BEFORE INTEREST,
INCOME TAXES AND DEPRECIATION AND AMORTIZATION
(In thousands)
(Unaudited)

	For the				For the
	Three Months Ended				Year Ended
	December 31,				December 31,
	2004		2003		2004		2003
Net Income	$	8,146	$	5,285	$	28,908	$	20,605
Interest expense, net		4,227		4,812		17,573		19,132
Provision for income taxes		5,691		3,849		20,119		15,006
Depreciation and amortization		8,248		6,890		29,655		25,264
EBITDA	$	26,312	$	20,836	$	96,255	$	80,007