Document and Entity Information
Document and Entity Information - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2015 | Feb. 26, 2016 | |
Document Information [Line Items] | ||
Document Type | 10-K | |
Amendment Flag | false | |
Document Period End Date | Dec. 31, 2015 | |
Document Fiscal Year Focus | 2,015 | |
Document Fiscal Period Focus | FY | |
Trading Symbol | PLNT | |
Entity Registrant Name | PLANET FITNESS, INC. | |
Entity Central Index Key | 1,637,207 | |
Current Fiscal Year End Date | --12-31 | |
Entity Well-known Seasoned Issuer | No | |
Entity Current Reporting Status | Yes | |
Entity Voluntary Filers | No | |
Entity Filer Category | Non-accelerated Filer | |
Entity Public Float | $ 242.7 | |
Class A Common Stock [Member] | ||
Document Information [Line Items] | ||
Entity Common Stock, Shares Outstanding | 36,597,985 | |
Class B Common Stock [Member] | ||
Document Information [Line Items] | ||
Entity Common Stock, Shares Outstanding | 62,111,755 |
Consolidated balance sheets
Consolidated balance sheets - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 |
Current assets: | ||
Cash and cash equivalents | $ 31,430 | $ 43,291 |
Accounts receivable, net of allowance for bad debts of $629 and $399 at December 31, 2015 and December 31, 2014, respectively | 19,079 | 19,275 |
Due from related parties | 4,940 | 1,141 |
Inventory | 4,557 | 3,012 |
Restricted assets – NAF (note 5) | 1,962 | |
Notes Receivable, current | 1,290 | |
Prepaid expenses | 5,152 | 4,355 |
Other current assets | 5,825 | 2,954 |
Total current assets | 72,945 | 75,318 |
Property and equipment, net | 56,139 | 49,579 |
Intangible assets, net | 273,619 | 295,162 |
Goodwill | 176,981 | 176,981 |
Deferred income taxes | 117,358 | 260 |
Notes receivable, net of current portion | 2,007 | |
Other assets, net | 2,135 | 2,675 |
Total assets | 699,177 | 601,982 |
Current liabilities: | ||
Current maturities of long-term debt | 5,100 | 3,900 |
Accounts payable | 23,950 | 26,738 |
Accrued expenses | 13,667 | 8,494 |
Equipment deposits | 5,587 | 6,675 |
Deferred revenue, current | 14,717 | 14,549 |
Payable to related parties pursuant to tax benefit arrangements, current | 3,019 | |
Other current liabilities | 212 | 529 |
Total current liabilities | 66,252 | 60,885 |
Long-term debt, net of current maturities | 479,779 | 375,881 |
Deferred rent, net of current portion | 4,554 | 3,012 |
Deferred revenue, net of current portion | 12,016 | 9,330 |
Deferred tax liabilities | 606 | |
Payable to related parties pursuant to tax benefit arrangements, net of current portion | 137,172 | |
Other liabilities | 484 | 519 |
Total noncurrent liabilities | $ 634,005 | $ 389,348 |
Commitments and contingencies (note 17) | ||
Stockholders'/members' equity: | ||
Members’ equity | $ 146,156 | |
Accumulated other comprehensive income (loss) | $ (1,710) | (636) |
Additional paid in capital | 352 | |
Accumulated deficit | (14,032) | |
Total stockholders' deficit attributable to Planet Fitness, Inc./members' equity | (15,380) | 145,520 |
Non-controlling interests | 14,300 | 6,229 |
Total stockholders' deficit/members' equity | (1,080) | 151,749 |
Total liabilities and stockholders' deficit/members' equity | 699,177 | $ 601,982 |
Class A Common Stock [Member] | ||
Stockholders'/members' equity: | ||
Common stock, value | 4 | |
Class B Common Stock [Member] | ||
Stockholders'/members' equity: | ||
Common stock, value | $ 6 |
Consolidated balance sheets (Pa
Consolidated balance sheets (Parenthetical) - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 |
Accounts receivable, allowance for bad debts | $ 629 | $ 399 |
Class A Common Stock [Member] | ||
Common stock, par value | $ 0.0001 | |
Common stock, shares authorized | 300,000,000 | |
Common stock, shares issued | 36,598,000 | |
Common stock, shares outstanding | 36,597,985 | |
Class B Common Stock [Member] | ||
Common stock, par value | $ 0.0001 | |
Common stock, shares authorized | 100,000,000 | |
Common stock, shares issued | 62,112,000 | |
Common stock, shares outstanding | 62,112,000 |
Consolidated statements of oper
Consolidated statements of operations - USD ($) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | ||
Revenue: | ||||
Franchise | $ 71,762 | $ 58,001 | $ 33,684 | |
Commission income | 16,323 | 13,805 | 10,473 | |
Corporate-owned stores | 98,390 | 85,041 | 67,364 | |
Equipment | 144,062 | 122,930 | 99,488 | |
Total revenue | 330,537 | 279,777 | 211,009 | |
Operating costs and expenses: | ||||
Cost of revenue | 113,492 | 100,306 | 81,353 | |
Store operations | 57,485 | 49,476 | 41,692 | |
Selling, general and administrative | 55,573 | 35,121 | 23,118 | |
Depreciation and amortization | 32,158 | 32,341 | 28,808 | |
Other (gain) loss | (273) | 994 | ||
Total operating costs and expenses | 258,435 | 218,238 | 174,971 | |
Income from operations | 72,102 | 61,539 | 36,038 | |
Other expense, net: | ||||
Interest expense, net | (24,549) | (21,800) | (8,912) | |
Other expense | (275) | (1,261) | (694) | |
Total other expense, net | (24,824) | (23,061) | (9,606) | |
Income before income taxes | 47,278 | 38,478 | 26,432 | |
Provision for income taxes | 9,148 | 1,183 | 633 | |
Net income | 38,130 | 37,295 | 25,799 | |
Less net income attributable to non-controlling interests | 19,612 | 487 | 361 | |
Net income attributable to Planet Fitness, Inc. | $ 18,518 | $ 36,808 | $ 25,438 | |
Class A Common Stock [Member] | ||||
Net income per share of Class A common stock: | ||||
Basic & diluted | [1] | $ 0.11 | ||
Weighted-average shares of Class A common stock outstanding(1): | ||||
Basic & diluted | [1] | 36,244 | ||
[1] | Represents earnings per share of Class A common stock and weighted-average shares of Class A common stock outstanding for the period from August 6, 2015 through December 31, 2015, the period following the recapitalization transactions and IPO (see Note 15). |
Consolidated statements of comp
Consolidated statements of comprehensive income - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Statement Of Income And Comprehensive Income [Abstract] | |||
Net income including non-controlling interests | $ 38,130 | $ 37,295 | $ 25,799 |
Other comprehensive (loss) income, net: | |||
Gains (losses) on interest rate swaps, net of tax | (92) | 92 | |
Unrealized loss on interest rate caps, net of tax | (1,388) | (662) | |
Foreign currency translation adjustments | 314 | 26 | |
Total other comprehensive (loss) income, net | (1,074) | (728) | 92 |
Total comprehensive income including non-controlling interests | 37,056 | 36,567 | 25,891 |
Less: total comprehensive income attributable to non-controlling interests | 19,557 | 487 | 361 |
Total comprehensive income attributable to Planet Fitness, Inc. | $ 17,499 | $ 36,080 | $ 25,530 |
Consolidated statements of cash
Consolidated statements of cash flows - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Cash flows from operating activities: | |||
Net income | $ 38,130 | $ 37,295 | $ 25,799 |
Adjustments to reconcile net income to net cash provided by operating activities: | |||
Depreciation and amortization | 32,158 | 32,341 | 28,808 |
Amortization of deferred financing costs | 1,596 | 1,315 | 1,582 |
Amortization of favorable leases and asset retirement obligations | 478 | 501 | 246 |
Amortization of interest rate caps | 28 | ||
Deferred tax (benefit) expense | 6,135 | (63) | (1,430) |
Gain on decrease in tax benefit arrangement | (2,549) | ||
Provision for bad debts | 667 | 139 | 57 |
Gain on disposal of property and equipment | (273) | (545) | (52) |
Loss on extinguishment of debt | 4,697 | ||
Equity-based compensation | 4,877 | ||
Changes in operating assets and liabilities, excluding effects of acquisitions: | |||
Accounts receivable | (414) | (3,632) | (3,101) |
Notes receivable and due from related parties | 4,210 | 177 | 1,281 |
Inventory | (1,545) | (769) | (1,750) |
Other assets and other current assets | (5,720) | (1,818) | (776) |
Accounts payable and accrued expenses | 263 | 5,042 | 13,456 |
Other liabilities and other current liabilities | 99 | (2) | 421 |
Income taxes | 115 | (1,670) | (364) |
Equipment deposits | (1,088) | 4,028 | (1,803) |
Deferred revenue | 2,994 | 842 | 3,398 |
Deferred rent | 1,502 | 1,527 | 1,171 |
Net cash provided by operating activities | 81,663 | 79,405 | 66,943 |
Cash flows from investing activities: | |||
Additions to property and equipment | (19,488) | (16,650) | (7,287) |
Acquisition of franchises | (38,638) | ||
Proceeds from sale of property and equipment | 327 | 926 | 150 |
Net cash used in investing activities | (19,161) | (54,362) | (7,137) |
Cash flows from financing activities: | |||
Proceeds from issuance of Class A common stock sold in initial public offering, net of underwriting discounts and commissions | 156,946 | ||
Use of proceeds from issuance of Class A common stock to purchase Holdings Units | (156,946) | ||
Proceeds from issuance of long-term debt | 120,000 | 390,000 | |
Principal payments on capital lease obligations | (376) | (1,162) | (3,291) |
Repayment of long-term debt | (14,800) | (185,800) | (10,544) |
Net repayments on line of credit | (3,525) | ||
Payment of deferred financing and other debt-related costs | (1,698) | (7,785) | (19) |
Premiums paid for interest rate caps | (880) | (2,373) | |
Contributions from variable interest entities | 3,402 | ||
Distributions to variable interest entities | (458) | (960) | |
Distributions to members of Pla-Fit Holdings | (176,486) | (205,374) | (23,057) |
Net cash used in financing activities | (74,240) | (12,952) | (37,994) |
Effects of exchange rate changes on cash and cash equivalents | (123) | (67) | |
Net (decrease) increase in cash and cash equivalents | (11,861) | 12,024 | 21,812 |
Cash and cash equivalents, beginning of period | 43,291 | 31,267 | 9,455 |
Cash and cash equivalents, end of period | 31,430 | 43,291 | 31,267 |
Supplemental cash flow information: | |||
Net cash paid for income taxes | 2,834 | 1,604 | 1,826 |
Cash paid for interest | 23,220 | 20,756 | $ 7,638 |
Non-cash investing activities: | |||
Non-cash consideration for acquisition of franchises | 3,000 | ||
Non-cash additions to property and equipment | $ 207 | 1,049 | |
Non-cash financing activities: | |||
Non-cash distributions to members | $ 901 |
Consolidated Statement of Chang
Consolidated Statement of Changes in Equity - USD ($) $ in Thousands | Total | Members' Equity [Member] | Accumulated Other Comprehensive Loss [Member] | Additional Paid-in capital [Member] | Accumulated Deficit [Member] | Non-Controlling Interests [Member] | Class A Common Stock [Member] | Class A Common Stock [Member]Common Stock [Member] | Class B Common Stock [Member] | Class B Common Stock [Member]Common Stock [Member] |
Beginning balance at Dec. 31, 2012 | $ 316,639 | $ 313,242 | $ 3,397 | |||||||
Net income | 25,799 | 25,438 | 361 | |||||||
Other comprehensive income (loss) | 92 | $ 92 | ||||||||
Contributions from members | 3,402 | 3,402 | ||||||||
Distributions to members | (24,017) | (23,057) | (960) | |||||||
Ending balance at Dec. 31, 2013 | 321,915 | 315,623 | 92 | 6,200 | ||||||
Net income | 37,295 | 36,808 | 487 | |||||||
Other comprehensive income (loss) | (728) | (728) | ||||||||
Distributions to members | (206,733) | (206,275) | (458) | |||||||
Ending balance at Dec. 31, 2014 | 151,749 | 146,156 | (636) | 6,229 | ||||||
Net income | 38,130 | |||||||||
Other comprehensive income (loss) | (1,074) | |||||||||
Distributions to members prior to the recapitalization transactions | (164,693) | (164,693) | ||||||||
Net income prior to the recapitalization transactions | 14,676 | 14,412 | 264 | |||||||
Other comprehensive loss prior to the recapitalization transactions | (1,054) | (1,054) | ||||||||
Equity-based compensation expense recorded in connection with recapitalization transactions | 4,525 | 4,525 | ||||||||
Effect of the recapitalization transactions | $ (400) | $ 138 | 252 | $ 3 | $ 7 | |||||
Effect of the recapitalization transactions, shares | 26,107,000 | 72,603,000 | ||||||||
Issuance of Class A common stock in IPO, net of commissions | 1 | (1) | ||||||||
Issuance of Class A common stock in IPO, net of commissions, shares | 10,491,000 | (10,491,000) | ||||||||
Tax benefit arrangement liability and deferred taxes arising from the recapitalization transactions and IPO | (18,276) | (18,276) | ||||||||
Net income subsequent to the recapitalization transactions | 23,454 | 4,106 | 19,348 | |||||||
Equity-based compensation expense subsequent to the recapitalization transactions | 352 | $ 352 | ||||||||
Distributions to members of Pla-Fit Holdings subsequent to the recapitalization transactions | (11,793) | (11,793) | ||||||||
Other comprehensive loss subsequent to the recapitalization transactions | (20) | (20) | ||||||||
Ending balance at Dec. 31, 2015 | $ (1,080) | $ (1,710) | $ 352 | $ (14,032) | $ 14,300 | $ 4 | $ 6 | |||
Ending balance (shares) at Dec. 31, 2015 | 36,597,985 | 62,112,000 |
Business organization
Business organization | 12 Months Ended |
Dec. 31, 2015 | |
Organization Consolidation And Presentation Of Financial Statements [Abstract] | |
Business organization | (1) Business organization Planet Fitness, Inc. (the “Company”), through its subsidiaries, is a franchisor and operator of fitness centers, with approximately 7.3 million members and 1,124 owned and franchised locations (referred to as stores) in 47 states, the District of Columbia, Puerto Rico, Dominican Republic and Canada as of December 31, 2015. The Company serves as the reporting entity for its various subsidiaries that operate three distinct lines of business: · Licensing and selling franchises under the Planet Fitness trade name; · Owning and operating fitness centers under the Planet Fitness trade name; and · Selling fitness-related equipment to franchisee-owned stores. In 2012 investment funds affiliated with TSG Consumer Partners, LLC (“TSG”), purchased interests in Pla-Fit Holdings. The Company was formed as a Delaware corporation on March 16, 2015 for the purpose of facilitating an initial public offering (the “IPO”) and related transactions in order to carry on the business of Pla-Fit Holdings, LLC and its subsidiaries (“Pla-Fit Holdings”). As of August 5, 2015, in connection with the recapitalization transactions discussed below, the Company became the sole managing member and holder of 100% of the voting power and 37.1% of the economic interest of Pla-Fit Holdings. Pla-Fit Holdings owns 100% of Planet Intermediate, LLC which has no operations but is the 100% owner of Planet Fitness Holdings, LLC, a franchisor and operator of fitness centers. With respect to the Company, Pla-Fit Holdings and Planet Intermediate, LLC, each entity owns nothing other than the respective entity below it in the corporate structure and each entity has no other material operations. Initial Public Offering On August 11, 2015, the Company completed an IPO pursuant to which the Company and selling stockholders sold an aggregate of 15,525,000 shares of Class A common stock at a public offering price of $16.00 per share. The Company received $156,946 in proceeds from its sale of 10,491,055 shares of Class A common stock, net of underwriting discounts and commissions, which were used to purchase an equal number of limited liability company units (“Holdings Units”) from existing holders (“Continuing LLC Owners”) of interests in Pla-Fit Holdings, at a purchase price per unit equal to the IPO price per share of Class A common stock, net of underwriting discounts and commissions. Recapitalization Transactions In connection with the IPO, the Company and Pla-Fit Holdings completed a series of recapitalization transactions on August 5, 2015 which are described below (also see Note 12): · Pla-Fit Holdings amended and restated the limited liability company agreement to, among other things, (i) provide for a new single class of limited liability company units, Holdings Units, (ii) exchange all membership interests of the then-existing holders of Pla-Fit Holdings membership interests for Holdings Units and (iii) appoint the Company as the sole managing member of Pla-Fit Holdings. · The Company issued 72,602,810 shares of Class B common stock with voting rights but no economic rights to Pla-Fit Holdings’ existing owners on a one-to-one basis for each Holdings Unit owned. · The Company merged with Planet Fitness Holdings L.P., a predecessor entity to the Company that held indirect interests in Pla-Fit Holdings, for which the Company issued 26,106,930 shares of Class A common stock to the holders of interests in Planet Fitness Holdings L.P. (the “Direct TSG Investors”). Subsequent to the IPO and the related recapitalization transactions, the Company is a holding company whose principal asset is a controlling equity interest in Pla-Fit Holdings. As the sole managing member of Pla-Fit Holdings, the Company operates and controls all of the business and affairs of Pla-Fit Holdings, and through Pla-Fit Holdings, conducts its business. As a result, the Company consolidates Pla-Fit Holdings’ financial results and reports a non-controlling interest related to the portion of Holdings Units not owned by the Company. As of December 31, 2015, the Company held 100% of the voting interest, and approximately 37.1% of the economic interest in Pla-Fit Holdings. As future exchanges of Holdings Units occur, the economic interest in Pla-Fit Holdings held by Planet Fitness, Inc. will increase. The recapitalization transactions are considered transactions between entities under common control. As a result, the financial statements for periods prior to the IPO and the recapitalization transactions are the financial statements of Pla-Fit Holdings as the predecessor to the Company for accounting and reporting purposes. Unless otherwise specified, “the Company” refers to both Planet Fitness, Inc. and Pla-Fit Holdings throughout the remainder of these notes. |
Summary of significant accounti
Summary of significant accounting policies | 12 Months Ended |
Dec. 31, 2015 | |
Accounting Policies [Abstract] | |
Summary of significant accounting policies | (2) Summary of significant accounting policies (a) Basis of presentation and consolidation The accompanying consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (U.S. GAAP) and pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”). All significant intercompany balances and transactions have been eliminated in consolidation. As discussed in Note 1, as a result of the recapitalization transactions, Planet Fitness, Inc. consolidates Pla-Fit Holdings and Pla-Fit Holdings is considered to be the predecessor to Planet Fitness, Inc. for accounting and reporting purposes. The Company also consolidates entities in which it has a controlling financial interest, the usual condition of which is ownership of a majority voting interest. The Company also considers for consolidation certain interests where the controlling financial interest may be achieved through arrangements that do not involve voting interests. Such an entity, known as a variable interest entity (“VIE”), is required to be consolidated by its primary beneficiary. The primary beneficiary of a VIE is considered to possess the power to direct the activities of the VIE that most significantly impact its economic performance and has the obligation to absorb losses or the rights to receive benefits from the VIE that are significant to it. The principal entities in which the Company possesses a variable interest include franchise entities and certain other entities. The Company is not deemed to be the primary beneficiary for Planet Fitness franchise entities. Therefore, these entities are not consolidated. The results of the Company have been consolidated with Matthew Michael Realty LLC (“MMR”) and PF Melville LLC (“PF Melville”) based on the determination that the Company is the primary beneficiary with respect to these VIEs. These entities are real estate holding companies that derive a majority of their financial support from the Company through lease agreements for corporate stores. See Note 3 for further information related to the Company’s VIEs. (b) Use of estimates The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes. Although these estimates are based on management’s knowledge of current events and actions it may undertake in the future, they may ultimately differ from actual results. Significant areas where estimates and judgments are relied upon by management in the preparation of the consolidated financial statements include revenue recognition, valuation of assets and liabilities in connection with acquisitions, valuation of equity-based compensation awards, the evaluation of the recoverability of goodwill and long-lived assets, including intangible assets, income taxes, including deferred tax assets and liabilities and reserves for unrecognized tax benefits, and the liability for the Company’s tax benefit arrangements. (c) Concentrations Cash and cash equivalents are financial instruments, which potentially subject the Company to a concentration of credit risk. The Company invests its excess cash in several major financial institutions, which are insured by the Federal Deposit Insurance Corporation (FDIC) up to $250,000. The Company maintains balances in excess of these limits, but does not believe that such deposits with its banks are subject to any unusual risk. The credit risk associated with trade receivables is mitigated due to the large number of customers, generally our franchisees, and their broad dispersion over many different geographic areas. We do not have any concentrations with respect to our revenues. The Company purchases equipment, both for corporate-owned stores and for sales to franchisee-owned stores, from two primary vendors. For the year ended December 31, 2015 purchases from these two vendors comprised 79% and 18%, respectively, for the year ended December 31, 2014 purchases from these two vendors comprised 66% and 25%, respectively, and for the year ended December 31, 2013 purchases from these two vendors comprised 66% and 27%, respectively, of total equipment purchases. The Company, including Planet Fitness NAF, LLC (“NAF”) uses one primary vendor for advertising services. Purchases from this vendor totaled 49%, 61%, and 68% of total advertising purchases for the years ended December 31, 2015, 2014 and 2013, respectively (see Note 5 for further discussion of NAF). (d) Cash and cash equivalents The Company considers all highly liquid investments purchased with an original maturity of 90 days or less to be cash equivalents. Cash held within the NAF is recorded as a restricted asset (see Note 5). (e) Revenue recognition Franchise revenue The following revenues are generated as a result of transactions with or related to the Company’s franchisees. Area development fees Franchisees contractually enter into area development agreements (ADAs) to secure the exclusive right to open franchise stores within a defined geographical area. ADAs establish the timing and number of stores to be developed within the defined geographical area. Pursuant to an ADA, a franchisee is generally required to pay an initial nonrefundable development fee for a minimum number of stores to be developed, as outlined in the respective ADA. ADA fees collected in advance are deferred until the Company provides substantially all required obligations pursuant to the ADA. As the efforts and total cost relating to initial services are affected significantly by the number of stores opened in an area, the respective ADA is treated as a divisible contract. As each new site is accepted under an ADA, a franchisee signs a franchise operating agreement for the respective franchise location. As each store opened under an ADA typically has performance obligations associated with it, the Company recognizes ADA revenue as each individual franchise location is developed in proportion to the total number of stores to be developed under the ADA. These obligations are typically completed once the store is opened or the franchisee executes the individual property lease. As of December 31, 2015 and 2014, the deferred revenue for ADAs was $10,471 and $8,215, respectively. ADAs generally have an initial term equal to the number of years over which the franchisee is required to open franchise stores, which is typically 5 to 10 years. There is no right of refund for an executed ADA. Upon default, as defined in the agreement, the Company may reacquire the rights pursuant to an ADA, and all remaining deferred revenue is recognized at that time. Franchise fees and performance fees For stores opened without an ADA, the Company generally charges an initial upfront nonrefundable franchise fee. Nonrefundable franchise fees are typically deferred until the franchisee executes a lease and receives initial training for the location, which is the point at which the Company has determined it has provided all of its material obligations required to recognize revenue. As of December 31, 2015 and 2014, the Company has recorded deferred franchise fees of $473 and $205, respectively, relating to stores to be opened in future years. These amounts are included in deferred revenue as of December 31, 2015 and 2014. The individual franchise agreements typically have a 10-year initial term, but provide the franchisee with an opportunity to enter into successive renewals subject to certain conditions. Franchise agreements entered into prior to 2010 may include performance fees, which are fees earned by the Company upon each franchise store reaching a predetermined amount of total monthly membership billings. Performance fees are recognized when the related performance thresholds have been met. Royalties Royalties, which represent recurring fees paid by franchisees based on the franchisee-owned stores’ monthly membership billings, are recognized on a monthly basis over the term of the franchise agreement. As specified under certain franchise agreements, the Company recognizes additional royalty fees as the franchisee-owned stores attain contractual monthly membership billing threshold amounts. Beginning in 2010, for all new franchise agreements entered into, the Company began charging a fixed royalty percentage based upon gross membership billings. Other fees Online member join fees are paid to the Company by franchisees for processing new membership transactions when a new member signs up for a membership to a franchisee-owned store through the Company’s website. Billing transaction fees are paid to the Company for the processing of franchisee membership dues and annual fees through the Company’s third-party hosted point-of-sale system. Placement The Company is generally responsible for assembly and placement of equipment it sells to franchisee-owned stores. Placements revenue is recognized upon completion and acceptance of the services at the franchise location. Commission income The Company recognizes commission income from its franchisees’ use of preferred vendor arrangements. Commissions are recognized when amounts have been earned and collectability from the vendor is reasonably assured. Corporate-owned stores revenue The following revenues are generated from stores owned and operated by the Company. Membership dues revenue Customers are offered multiple membership choices varying in length. Membership dues are earned and recognized over the membership term on a straight-line basis. Enrollment fee revenue Enrollment fees are charged to new members at the commencement of their membership. The Company recognizes enrollment fees ratably over the estimated duration of the membership life, which is generally two years. Annual membership fee revenue Annual membership fees are annual fees charged to members in addition to and in order to maintain low monthly membership dues. The Company recognizes annual membership fees ratably over the 12-month membership period. Retail sales The Company sells Planet Fitness branded apparel, food, beverages, and other accessories. The revenue for these items is recognized at the point of sale. Equipment revenue The Company sells and delivers equipment purchased from third-party equipment manufacturers to U.S. based franchisee-owned stores. Equipment revenue is recognized upon the equipment being delivered to and assembled at each store and accepted by the franchisee. Franchisees are charged for all freight costs incurred for the delivery of equipment. Freight revenue is recorded within equipment revenue and freight costs are recorded within cost of revenue. The Company recognizes revenue on a gross basis in these transactions as management has determined the Company to be the principal in these transactions. Management determined the Company to be the principal because the Company is the primary obligor in these transactions, the Company has latitude in establishing prices for the equipment sales to franchisees, the Company has supplier selection discretion and is involved in determination of product specifications, and the Company bears all credit risk associated with obligations to the equipment manufacturers. Equipment deposits are recognized as a liability on the accompanying consolidated balance sheets until delivery, assembly (if required), and acceptance by the franchisee. As of December 31, 2015 and 2014, equipment deposits were $5,587 and $6,675, respectively. Sales tax All revenue amounts are recorded net of applicable sales tax. (f) Deferred revenue Deferred revenue represents cash received from franchisees for ADAs and franchise fees for which revenue recognition criteria has not yet been met and cash received from members for enrollment fees, membership dues and annual fees for the portion not yet earned based on the membership period. (g) Cost of revenue Cost of revenue consists of direct costs associated with equipment sales, including freight costs, direct costs related to the maintenance and support of the Company’s proprietary system-wide point-of-sale system, and the cost of retail merchandise sold in corporate-owned stores. Costs related to the point-of-sale system were $1,236, $3,385, and $1,107 for the years ended December 31, 2015, 2014 and 2013 respectively. Costs related to retail merchandise were immaterial in all periods presented. Rebates from equipment vendors where the Company has recognized the related equipment revenue and costs are recorded as a reduction to the cost of revenue. (h) Store operations Store operations consists of the direct costs related to operating corporate-owned stores, including our store management and staff, rent expense, utilities, supplies, maintenance, and local advertising. (i) Selling, general and administrative Selling, general and administrative expenses consist of costs associated with administrative and franchisee support functions related to our existing business as well as growth and development activities. These costs primarily consist of payroll, IT related, marketing, legal and accounting expenses. These expenses include costs related to placement services of $3,452, $2,743, and $2,245, for the years ended December 31, 2015, 2014 and 2013, respectively. (j) Accounts and notes receivable Accounts receivable is primarily comprised of amounts owed to the Company resulting from equipment, placement, and commission revenue. Notes receivable arise primarily from financing activities with franchisees. The Company evaluates its accounts and notes receivable on an ongoing basis and may establish an allowance for doubtful accounts based on collections and current credit conditions. Accounts are written off as uncollectible when it is determined that further collection efforts will be unsuccessful. Notes receivable are generally secured by all property, assets, and rights owned by the franchisee. Historically, the Company has not had a significant amount of write-offs. (k) Leases and asset retirement obligations The Company recognizes rent expense related to leased office and operating space on a straight-line basis over the term of the lease. The difference between rent expense and rent paid, if any, as a result of escalation provisions and lease incentives, such as tenant improvements provided by lessors, and is recorded as deferred rent in the Company’s consolidated balance sheets. In accordance with ASC Topic 410, Asset Retirement and Environmental Obligations (l) Property and equipment Property and equipment is recorded at cost and depreciated using the straight-line method over its related estimated useful life. Leasehold improvements are amortized over the shorter of the lease term or the estimated useful life of the related asset, whichever is shorter. Upon sale or retirement, the asset cost and related accumulated depreciation are removed from the respective accounts, and any related gain or loss is reflected in the consolidated statements of operations. Ordinary maintenance and repair costs are expensed as incurred. The estimated useful lives of the Company’s fixed assets by class of asset are as follows: Years Buildings and building improvements 20–40 Computers and equipment 3 Furniture and fixtures 5 Leasehold improvements Useful life or term of lease whichever is shorter Fitness equipment 5–7 Vehicles 5 (m) Advertising expenses The Company expenses advertising costs as incurred. Advertising expenses, net of amounts reimbursed by franchisees, are included within selling, general and administrative expenses and totaled $9,349, $7,272, and $5,731 for the years ended December 31, 2015, 2014 and 2013, respectively. See Note 5 for discussion of the national advertising fund. (n) Goodwill, long-lived assets, and other intangible assets Goodwill and other intangible assets that arise from acquisitions are recorded in accordance with ASC Topic 350, Intangibles—Goodwill and Other Goodwill and indefinite-lived intangible assets are not amortized, but are reviewed annually for impairment or more frequently if impairment indicators arise. Separable intangible assets that are not deemed to have an indefinite life are amortized over their estimated useful lives on either a straight-line or accelerated basis as deemed appropriate, and are reviewed for impairment when events or circumstances suggest that the assets may not be recoverable. The Company performs its annual test for impairment of goodwill and indefinite lived intangible assets on December 31 of each year. For goodwill, the first step of the impairment test is to determine whether the carrying amount of a reporting unit exceeds the fair value of the reporting unit. If the carrying amount of the reporting unit exceeds the reporting unit’s fair value, the Company would be required to perform a second step of the impairment test as this is an indication that the reporting unit’s goodwill may be impaired. The second step compares the implied fair value of the reporting unit’s goodwill with the carrying amount of that goodwill. Any impairment loss would be recognized in an amount equal to the excess of the carrying value of the goodwill over the implied fair value of the goodwill. The Company is also permitted to make a qualitative assessment of whether it is more likely than not that a reporting unit’s fair value is less than its carrying amount before applying the two-step goodwill impairment test. If the Company concludes it is not more likely than not that the fair value of a reporting unit is less than its carrying amount, it need not perform the two-step impairment test. For indefinite lived intangible assets, the impairment assessment consists of comparing the carrying value of the asset to its estimated fair value. To the extent that the carrying value exceeds the fair value of the asset, an impairment is recorded to reduce the carrying value to its fair value. The Company is also permitted to make a qualitative assessment of whether it is more likely than not an indefinite lived intangible asset’s fair value is less than its carrying value prior to applying the quantitative assessment. If based on the Company’s qualitative assessment it is not more likely than not that the carrying value of the asset is less than its fair value, then a quantitative assessment is not required. The Company determined that no impairment charges were required during any periods presented. The Company applies the provisions of ASC Topic 360, Property, Plant and Equipment (o) Income taxes The Company accounts for income taxes using the asset and liability method. Deferred income taxes are recognized for the expected future tax consequences attributable to temporary differences between the carrying amount of the existing tax assets and liabilities and their respective tax basis. Deferred tax assets and liabilities are measured using enacted tax rates expected to be applied in the years in which temporary differences are expected to be recovered or settled. The principal items giving rise to temporary differences are the use of accelerated depreciation and certain basis differences resulting from acquisitions and the recapitalization transactions. Valuation allowances are established when necessary to reduce deferred tax assets to the amount expected to be realized. As a result of the recapitalization transactions, Planet Fitness, Inc. became the sole managing member of Pla-Fit Holdings, which is treated as a partnership for U.S. federal and most applicable state and local income tax purposes. As a partnership, Pla-Fit Holdings is not subject to U.S. federal and certain state and local income taxes. Any taxable income or loss generated by Pla-Fit Holdings is passed through to and included in the taxable income or loss of its members, including Planet Fitness, Inc. following the recapitalization transactions, on a pro rata basis. Planet Fitness, Inc. is subject to U.S. federal income taxes, in addition to state and local income taxes with respect to our allocable share of any taxable income of Pla-Fit Holdings following the recapitalization transactions. The Company is also subject to taxes in foreign jurisdictions. The Company recognizes the effect of income tax positions only if those positions are more likely than not to be sustained. Recognized income tax positions are measured at the largest amount that is greater than 50% likely of being realized. Changes in recognition or measurement are reflected in the period in which the change in judgment occurs (see Note 16). During 2013 the Company changed its position with respect to taxes due on interest and dividends to the state of New Hampshire that had previously been paid by the members. This resulted in the Company making tax payments in 2013 totaling $4,392 for periods prior to November 7, 2012. This amount is included within other income (expense) for the year ended December 31, 2013 and is fully offset by amounts received from the members as reimbursement for the taxes paid, also recorded within other income (expense) for the year ended December 31, 2013. This position is not available for periods subsequent to November 7, 2012 and therefore taxes on interest and dividends due and payable in the periods after 2012 are paid by the members of Pla-Fit Holdings. (p) Tax benefit arrangements The Company’s acquisition of Holdings Units in connection with the IPO and future and certain past exchanges of Holdings Units for shares of the Company’s Class A common stock (or cash at the option of the Company) are expected to produce and have produced favorable tax attributes. In connection with the IPO, the Company entered into two tax receivable agreements. Under the first of those agreements, the Company generally is required to pay to the Continuing LLC Owners 85% of the applicable tax savings, if any, in U.S. federal and state income tax that the Company is deemed to realize as a result of certain tax attributes of their Holdings Units sold to the Company (or exchanged in a taxable sale) and that are created as a result of (i) the sales of their Holdings Units for shares of Class A common stock and (ii) tax benefits attributable to payments made under the tax receivable agreement (including imputed interest). Under the second tax receivable agreement, the Company generally is required to pay to the Direct TSG Investors 85% of the amount of tax savings, if any, that the Company is deemed to realize as a result of the tax attributes of the Holdings Units held in respect of the Direct TSG Investors’ interest in the Company, which resulted from the Direct TSG Investors’ purchase of interests in Pla-Fit Holdings in 2012, and certain other tax benefits. Under both agreements, the Company generally retains the benefit of the remaining 15% of the applicable tax savings. Also, pursuant to the exchange agreement, to the extent an exchange results in Pla-Fit Holdings, LLC incurring a current tax liability relating to the New Hampshire business profits tax, the Continuing LLC Owners have agreed that they will contribute to Pla-Fit Holdings, LLC an amount sufficient to pay such tax liability (up to 3.5% of the value received upon exchange). If and when the Company subsequently realizes a related tax benefit, Pla-Fit Holdings, LLC will distribute the amount of any such tax benefit to the relevant Continuing LLC Owner in respect of its contribution. Based on current projections, the Company anticipates having sufficient taxable income to utilize these tax attributes and receive corresponding tax deductions in future periods. Accordingly, at the completion of the Reorganization Transactions and the IPO, the Company has recorded an initial liability of $142.0 million payable to the Direct TSG Investors and the Continuing LLC Owners under the tax benefit obligations, representing approximately 85% of the calculated tax savings based on the original basis adjustments the Company anticipates being able to utilize in future years. Changes in the projected liability resulting from these tax benefit arrangements may occur based on changes in anticipated future taxable income, changes in applicable tax rates or other changes in tax attributes that may occur and impact the expected future tax benefits to be received by the Company. Changes in the projected liability under these tax benefit arrangements will be recorded as a component of other income (expense) each period. The projection of future taxable income involves significant judgment. Actual taxable income may differ from estimates, which could significantly impact the liability under the tax benefit arrangements and the Company’s consolidated results of operations. (q) Fair value ASC 820, Fair Value Measurements and Disclosures Level 1—Inputs to the valuation methodology are quoted prices (unadjusted) for identical assets or liabilities in active markets. Level 2—Inputs to the valuation methodology include quoted prices for similar assets and liabilities in active markets, and inputs that are observable for the asset or liability, either directly or indirectly, for substantially the full term of the financial instrument. Level 3—Inputs to the valuation methodology are unobservable and significant to the fair value measurement. The table below presents information about the Company’s assets and liabilities that are measured at fair value on a recurring basis as of December 31, 2015 and December 31, 2014: Quoted Significant Total fair prices other Significant value at in active observable unobservable December 31, markets inputs inputs 2015 (Level 1) (Level 2) (Level 3) Interest rate caps $ 1,147 $ — $ 1,147 $ — Quoted Significant Total fair prices other Significant value at in active observable unobservable December 31, markets inputs inputs 2014 (Level 1) (Level 2) (Level 3) Interest rate caps $ 1,711 $ — $ 1,711 $ — (r) Financial instruments The carrying values of cash and cash equivalents, accounts receivable and accounts payable approximate fair value because of the short-term nature of these instruments. The carrying value of debt also approximates fair value as it is variable rate debt. The Company has determined that the determination of fair value of amounts due from related parties under long-term arrangements is impracticable given the related-party nature of these agreements. (s) Derivative instruments and hedging activities The Company recognizes all derivative instruments as either assets or liabilities in the balance sheet at their respective fair values. For derivatives designated in hedging relationships, changes in the fair value are either offset through earnings against the change in fair value of the hedged item attributable to the risk being hedged or recognized in accumulated other comprehensive income, to the extent the derivative is effective at offsetting the changes in cash flows being hedged until the hedged item affects earnings. The Company only enters into derivative contracts that it intends to designate as a hedge of a forecasted transaction or the variability of cash flows to be received or paid related to a recognized asset or liability (cash flow hedge). For all hedging relationships, the Company formally documents the hedging relationship and its risk-management objective and strategy for undertaking the hedge, the hedging instrument, the hedged transaction, the nature of the risk being hedged, how the hedging instrument’s effectiveness in offsetting the hedged risk will be assessed prospectively and retrospectively, and a description of the method used to measure ineffectiveness. The Company also formally assesses, both at the inception of the hedging relationship and on an ongoing basis, whether the derivatives that are used in hedging relationships are highly effective in offsetting changes in cash flows of hedged transactions. For derivative instruments that are designated and qualify as part of a cash flow hedging relationship, the effective portion of the gain or loss on the derivative is reported as a component of other comprehensive income and reclassified into earnings in the same period or periods during which the hedged transaction affects earnings. Gains and losses on the derivative representing either hedge ineffectiveness or hedge components excluded from the assessment of effectiveness are recognized in current earnings. The Company discontinues hedge accounting prospectively when it determines that the derivative is no longer effective in offsetting cash flows attributable to the hedged risk, the derivative expires or is sold, terminated, or exercised, the cash flow hedge is de-designated because a forecasted transaction is not probable of occurring, or management determines to remove the designation of the cash flow hedge. In all situations in which hedge accounting is discontinued and the derivative remains outstanding, the Company continues to carry the derivative at its fair value on the balance sheet and recognizes any subsequent changes in its fair value in earnings. When it is probable that a forecasted transaction will not occur, the Company discontinues hedge accounting and recognizes immediately in earnings gains and losses that were accumulated in other comprehensive income related to the hedging relationship. See Note 10 for further information. (t) Equity-based compensation The Company has an equity-based compensation plan under which it receives services from employees as consideration for equity instruments of the Company. The compensation expense is determined based on the fair value of the award as of the grant date. Compensation expense is recognized over the vesting period, which is the period over which all of the specified vesting conditions are satisfied. For awards with graded vesting, the fair value of each tranche is recognized over its respective vesting period. See Note 14 for further information. (u) Guarantees The Company, as a guarantor, is required to recognize, at inception of the guaranty, a liability for the fair value of the obligation undertaken in issuing the guarantee. See Notes 3 and 17 for further discussion of such obligations guaranteed. (v) Contingencies The Company records estimated future losses related to contingencies when such amounts are probable and estimable. The Company includes estimated legal fees related to such contingencies as part of the accrual for estimated future losses. (w) Reclassifications Certain amounts have been reclassified to conform to current year presentation, including deferred financing costs, which were previously classified in other assets, net and are now classified as a direct reduction of long-term debt, see Note 2(w). (x) Recent accounting pronouncements The FASB issued ASU No. 2015-03, Simplifying the Presentation of Debt Issuance Costs, The FASB issued ASU No. 2015-02, Income Statement—Consolidation, The FASB issued ASU No. 2014-09, Revenue from Contracts with Customers, In September 2015, the FASB issued Accounting Standards Update No. 2015-16, Business Combinations (Topic 805): Simplifying the Accounting for Measurement-Period Adjustments In November 2015, the FASB issued Accounting Standards Update No. 2015-17, Income Taxes (Topic 740): Balance Sheet Classification of Deferred Taxes |
Variable interest entities
Variable interest entities | 12 Months Ended |
Dec. 31, 2015 | |
Organization Consolidation And Presentation Of Financial Statements [Abstract] | |
Variable interest entities | (3) Variable interest entities The carrying values of VIEs included in the consolidated financial statements as of December 31, 2015 and December 31, 2014 are as follows: December 31, 2015 December 31, 2014 Assets Liabilities Assets Liabilities PF Melville $ 3,728 $ — $ 3,479 $ — MMR $ 2,953 — 2,750 — Total $ 6,681 $ — $ 6,229 $ — The Company also has variable interests in certain franchisees mainly through the guarantee of certain debt and lease agreements as well as financing provided by the Company and by certain related parties to franchisees. The Company’s maximum obligation, as a result of its guarantees of leases and debt, is approximately $1,871 and $2,896 as of December 31, 2015 and 2014, respectively. The amount of the Company’s maximum obligation represents a loss that the Company could incur from the variability in credit exposure without consideration of possible recoveries through insurance or other means. In addition, the amount bears no relation to the ultimate settlement anticipated to be incurred from the Company’s involvement with these entities, which is estimated at $0. |
Acquisition
Acquisition | 12 Months Ended |
Dec. 31, 2015 | |
Business Combinations [Abstract] | |
Acquisition | (4) Acquisition On March 31, 2014, the Company purchased certain assets from one of its franchisees, including eight franchisee-owned stores in New York, for consideration of $42,931, including a cash payment of $39,931 and a $3,000 discount to be applied to future equipment purchases. The $3,000 equipment discount was initially recorded as deferred revenue by the Company and is being recognized as equipment sales are made by the Company to the franchisee. In addition, as a result of the transaction, the Company incurred a loss on unfavorable reacquired franchise rights of $1,293, which has been reflected in other operating costs in the statement of operations. The loss incurred reduced the net purchase price to $41,638. The Company financed the purchase through borrowings under its credit facility. The purchase consideration was allocated as follows: Amount Fixed assets $ 7,634 Reacquired franchise rights 8,950 Membership relationships 5,882 Favorable leases, net 700 Other assets 35 Goodwill 19,771 Liabilities assumed, including deferred revenues (1,334 ) $ 41,638 |
National advertising fund
National advertising fund | 12 Months Ended |
Dec. 31, 2015 | |
Related Party Transactions [Abstract] | |
National advertising fund | (5) National advertising fund On July 26, 2011, the Company established Planet Fitness NAF, LLC (“NAF”) for the creation and development of marketing, advertising, and related programs and materials for all Planet Fitness stores located in the United States and Puerto Rico. On behalf of the NAF, the Company collects 2% of gross monthly membership billings from franchisees, in accordance with the provisions of the franchise agreements. The Company also contributes 2% of monthly membership billings from stores owned by the Company to the NAF. The use of amounts received by NAF is restricted to advertising, product development, public relations, merchandising, and administrative expenses and programs to increase sales and further enhance the public reputation of the Planet Fitness brand. The Company consolidates and reports all assets and liabilities held by the NAF within the consolidated financial statements. Amounts received or receivable by NAF are reported as restricted assets and restricted liabilities within current assets and current liabilities on the consolidated balance sheets. The Company provides administrative services to NAF and charges NAF a fee for providing those services. These services include accounting services, information technology, data processing, product development, legal and administrative support, and other operating expenses, which amounted $1,340, $1,010 and $865 for the years ended December 31, 2015, 2014 and 2013, respectively. The fees paid to the Company by NAF are included in the consolidated statements of operations as a reduction in general and administrative expense, where the expense incurred by the Company was initially recorded. |
Notes Receivable
Notes Receivable | 12 Months Ended |
Dec. 31, 2015 | |
Receivables [Abstract] | |
Notes Receivable | (6) Notes Receivable Prior to December 31, 2015, the Company had various notes receivable from franchisees to facilitate ongoing business. Notes receivable consisted of unpaid principal and accrued interest. There were two notes receivable as of December 31, 2014, with maturity dates ranging from July 1, 2015 to February 1, 2018, however, all notes receivable were settled in cash during 2015; as such, no amounts are outstanding as of December 31, 2015. |
Property and equipment
Property and equipment | 12 Months Ended |
Dec. 31, 2015 | |
Property Plant And Equipment [Abstract] | |
Property and equipment | (7) Property and equipment Property and equipment as of December 31, 2015 and 2014 consists of the following: December 31, 2015 December 31, 2014 Land $ 910 $ 910 Equipment 27,391 22,137 Leasehold improvements 38,288 27,361 Buildings and improvements 5,107 5,119 Furniture & fixtures 3,030 2,309 Other 2,947 2,096 Construction in progress 1,991 5,375 79,664 65,307 Accumulated Depreciation (23,525 ) (15,728 ) Total $ 56,139 $ 49,579 The Company recorded depreciation expense of $11,088, $9,138, and $6,171 for the years ended December 31, 2015, 2014 and 2013, respectively. |
Goodwill and intangible assets
Goodwill and intangible assets | 12 Months Ended |
Dec. 31, 2015 | |
Goodwill And Intangible Assets Disclosure [Abstract] | |
Goodwill and intangible assets | (8) Goodwill and intangible assets A summary of goodwill and intangible assets at December 31, 2015 and 2014 is as follows: Weighted average Gross amortization carrying Accumulated Net carrying December 31, 2015 period (years) amount amortization Amount Customer relationships 11.1 $ 171,782 (57,741 ) $ 114,041 Noncompete agreements 5.0 14,500 (9,127 ) 5,373 Favorable leases 7.5 2,935 (1,256 ) 1,679 Order backlog 0.4 3,400 (3,400 ) — Reacquired franchise rights 5.8 8,950 (2,724 ) 6,226 201,567 (74,248 ) 127,319 Indefinite-lived intangible: Trade and brand names N/A 146,300 — 146,300 Total intangible assets $ 347,867 $ (74,248 ) $ 273,619 Goodwill $ 176,981 $ — $ 176,981 Weighted average Gross amortization carrying Accumulated Net carrying December 31, 2014 period (years) amount amortization Amount Customer relationships 11.1 $ 171,782 $ (41,130 ) $ 130,652 Noncompete agreements 5.0 14,500 (6,229 ) 8,271 Favorable leases 7.5 2,935 (779 ) 2,156 Order backlog 0.4 3,400 (3,400 ) — Reacquired franchise rights 5.8 8,950 (1,167 ) 7,783 201,567 (52,705 ) 148,862 Indefinite-lived intangible: Trade and brand names N/A 146,300 — 146,300 Total intangible assets $ 347,867 $ (52,705 ) $ 295,162 Goodwill $ 176,981 $ — $ 176,981 The changes in the carrying amount of goodwill are as follows: Franchise Corporate-owned stores Equipment Total As of December 31, 2013 $ 16,938 $ 47,606 $ 92,666 $ 157,210 Acquisition of franchises — 19,771 — 19,771 As of December 31, 2014 16,938 67,377 92,666 176,981 Additions — — — — As of December 31, 2015 $ 16,938 $ 67,377 $ 92,666 $ 176,981 The Company determined that no impairment charges were required during any periods presented. Amortization expense related to the intangible assets totaled $21,543, $23,698, and $22,883 for the years ended December 31, 2015, 2014, and 2013, respectively. Included within these total amortization expense amounts are $473, $495, and $246 related to amortization of favorable and unfavorable leases for the years ended December 31, 2015, 2014, and 2013, respectively. Amortization of favorable and unfavorable leases is recorded within store operations as a component of rent expense in the consolidated statements of operations. The anticipated annual amortization expense to be recognized in future years as of December 31, 2015 is as follows: Amount 2016 $ 19,756 2017 18,215 2018 14,583 2019 14,215 2020 12,517 Thereafter 48,033 Total $ 127,319 |
Long-term debt
Long-term debt | 12 Months Ended |
Dec. 31, 2015 | |
Debt Disclosure [Abstract] | |
Long-term debt | (9) Long-term debt Long-term debt as of December 31, 2015 and 2014 consists of the following: December 31, 2015 December 31, 2014 Term loan B requires quarterly installments plus interest through the term of the loan, maturing March 31, 2021. Outstanding borrowings bear interest at LIBOR or base rate (as defined) plus a margin at the election of the borrower (4.75% at December 31, 2015 and 2014) $ 492,275 $ 387,075 Revolving credit line, requires interest only payments through the term of the loan, maturing March 31, 2019. Outstanding borrowings bear interest at LIBOR or base rate (as defined) plus a margin at the election of the borrower (4.25% at December 31, 2015 and 2014) — — Total debt, excluding deferred financing costs 492,275 387,075 Deferred financing costs, net of accumulated amortization (7,396 ) (7,294 ) Total debt 484,879 379,781 Current portion of long-term debt and line of credit 5,100 3,900 Long-term debt, net of current portion $ 479,779 $ 375,881 On March 31, 2014, the Company entered into a five-year $430,000 credit facility with a consortium of banks and lenders to refinance its existing indebtedness, as well as to provide funds for working capital, capital expenditures, acquisitions, a $173,900 dividend and general corporate purposes. The facility consisted of a $390,000 Term Loan and a $40,000 Revolving Credit Facility. On March 31, 2015, the Company amended this credit facility to increase the Term Loan to $510,000 to fund a cash dividend of $140,000. The unused portion of the Revolving Credit Facility as of December 31, 2015 was $40,000. The Term Loan calls for quarterly principal installment payments of $1,275 through March 2021. The credit facility requires the Company to meet certain financial covenants, which the Company was in compliance with as of December 31, 2015. The facility is secured by all of the Company’s assets, excluding the assets attributable to the consolidated VIEs (see Note 3). Future annual principal payments of long-term debt as of December 31, 2015 are as follows: Amount 2016 $ 5,100 2017 5,100 2018 5,100 2019 5,100 2020 5,100 Thereafter 466,775 Total $ 492,275 |
Derivative instruments and hedg
Derivative instruments and hedging activities | 12 Months Ended |
Dec. 31, 2015 | |
Derivative Instruments And Hedging Activities Disclosure [Abstract] | |
Derivative instruments and hedging activities | (10) Derivative instruments and hedging activities The Company utilizes interest-rate-related derivative instruments to manage its exposure related to changes in interest rates on its variable-rate debt instruments. The Company does not enter into derivative instruments for any purpose other than cash flow hedging. The Company does not speculate using derivative instruments. By using derivative financial instruments to hedge exposures to changes in interest rates, the Company exposes itself to credit risk and market risk. Credit risk is the failure of the counterparty to perform under the terms of the derivative contract. When the fair value of a derivative contract is an asset, the counterparty owes the Company, which creates credit risk for the Company. When the fair value of a derivative contract is a liability, the Company owes the counterparty and, therefore, the Company is not exposed to the counterparty’s credit risk in those circumstances. The Company minimizes counterparty credit risk in derivative instruments by entering into transactions with high-quality counterparties whose credit rating is higher than A1/A+ at the inception of the derivative transaction. The derivative instruments entered into by the Company do not contain credit-risk-related contingent features. Market risk is the adverse effect on the value of a derivative instrument that results from a change in interest rates. The market risk associated with interest-rate contracts is managed by establishing and monitoring parameters that limit the types and degree of market risk that may be undertaken. The Company assesses interest rate risk by continually identifying and monitoring changes in interest rate exposures that may adversely impact expected future cash flows and by evaluating hedging opportunities. The Company monitors interest rate risk attributable to both the Company’s outstanding or forecasted debt obligations as well as the Company’s offsetting hedge positions. During 2014, the Company utilized LIBOR-based interest rate swap agreements that were entered into to manage fluctuations in cash flows resulting from changes in the benchmark interest rate of LIBOR. It was determined on March 31, 2014 that the hedge was ineffective and expense of $92 was reclassified from other comprehensive income to interest expense. The interest rate swaps were all terminated by September 2014. The Company recorded a loss of $248 within interest expense in the consolidated statement of operations for the year ending December 31, 2014 related to these terminated swap agreements. In September 2014, the Company entered into a series of LIBOR based interest rate cap agreements in exchange for premium payments of $2,373 to effectively manage interest rate risk above a certain threshold and mitigate exposure to changes in interest rates under the term loan. The interest rate caps entered into in September 2014 were for a total notional amount of $194,000. The term of the interest rate caps began on September 30, 2014 and ends on September 29, 2017. In September 2015, the Company entered into two additional caps for premium payments of $880, which were effective September 30, 2015 and end on September 30, 2018. The interest rate cap agreements are designed to cap the LIBOR interest rate into a fixed interest rate if the LIBOR goes above the set cap amounts of 1.5%. As of December 31, 2015, the Company had interest rate cap agreements with notional amounts of $238,000 outstanding. Changes in the fair value of interest rate swaps and caps designated as hedging instruments that effectively offset the variability of cash flows associated with variable-rate, long-term debt obligations are reported in accumulated other comprehensive income. These amounts subsequently are reclassified into interest expense as a yield adjustment of the hedged interest payments in the same period in which the related interest affects earnings. The interest rate cap balances of $1,147 and $1,711 were recorded within other assets in the consolidated balance sheets as of December 31, 2015 and 2014, respectively. These amounts have been measured at fair value and are considered to be a Level 2 fair value measurement. The Company recorded a reduction to the value of its interest rate caps of $1,388, net of tax of $28, within other comprehensive loss during the year ended December 31, 2015. The Company recorded a reduction to the interest rate cap of $662 within other comprehensive loss as of December 31, 2014. As of December 31, 2015, the Company does not expect to reclassify any amounts included in accumulated other comprehensive income (loss) into earnings during the next 12 months. Transactions and events expected to occur over the next twelve months that will necessitate reclassifying these derivatives’ loss to earnings include the re-pricing of variable-rate debt. |
Deferred revenue
Deferred revenue | 12 Months Ended |
Dec. 31, 2015 | |
Deferred Revenue Disclosure [Abstract] | |
Deferred revenue | (11) Deferred revenue The summary set forth below represents the balances in deferred revenue as of December 31, 2015 and 2014: December 31, 2015 December 31, 2014 Prepaid membership fees $ 5,134 $ 5,382 Enrollment fees 1,555 1,692 Equipment discount 2,968 2,689 Annual membership fees 6,132 5,696 Area development and franchise fees 10,944 8,420 Total deferred revenue 26,733 23,879 Long-term portion of deferred revenue 12,016 9,330 Current portion of deferred revenue $ 14,717 $ 14,549 Equipment deposits received in advance of delivery, placement and customer acceptance as of December 31, 2015 and 2014 were $5,587 and $6,675, respectively and are expected to be recognized as revenue in the next twelve months. |
Related party transactions
Related party transactions | 12 Months Ended |
Dec. 31, 2015 | |
Related Party Transactions [Abstract] | |
Related party transactions | (12) Related party transactions Amounts due from stockholders/members as of December 31, 2015 and 2014 relate to reimbursements for certain taxes owed or paid by the Company. December 31, 2015 December 31, 2014 Accounts receivable – related entities $ 39 $ 11 Accounts receivable – stockholders/members 4,901 1,130 4,940 1,141 Due from related parties, current portion 4,940 1,141 Due from related parties, net of current portion $ — $ — Activity with entities considered to be related parties is summarized below. For the Year Ended December 31, 2015 2014 2013 Franchise revenue $ 1,232 $ 733 $ 1,620 Equipment revenue 1,686 3,711 855 Total revenue from related parties $ 2,918 $ 4,444 $ 2,475 The Company paid management fees to TSG totaling $1,899, $1,211, and $1,136 during the years ended December 31, 2015, 2014 and 2013 |
Stockholder's equity
Stockholder's equity | 12 Months Ended |
Dec. 31, 2015 | |
Equity [Abstract] | |
Stockholder's equity | (13) Stockholder’s equity The recapitalization transactions The Company refers to the Merger, Reclassification and entry into the Exchange agreement, each as described below, as the “recapitalization transactions.” The Merger was effected pursuant to a merger agreement by and among the Company and Planet Fitness Holdings, L.P. (a predecessor entity to the Company) and the recapitalization transactions were effected pursuant to a recapitalization agreement by and among the Company, Pla-Fit Holdings, the Continuing LLC Owners and Direct TSG Investors. Merger Prior to the Merger, the Direct TSG Investors held interests in Planet Fitness Holdings, L.P., a predecessor entity to the Company that held indirect interests in Pla-Fit Holdings. Planet Fitness Holdings, L.P. was formed in October 2014 and had no material assets, liabilities or operations, other than as a holding company owning indirect interests in Pla-Fit Holdings. The Direct TSG Investors consist of investment funds affiliated with TSG. Pursuant to a merger agreement dated June 22, 2015, upon the pricing of the IPO, Planet Fitness Holdings, L.P. merged with and into the Company, and the interests in Planet Fitness Holdings, L.P. held by the Direct TSG Investors were converted into 26,106,930 shares of Class A common stock of the Company. The Company refers to this as the “Merger.” All shares of Class A common stock have both voting and economic rights in Planet Fitness, Inc. The Merger was effected on August 5, 2015, prior to the time our Class A common stock was registered under the Exchange Act and prior to the completion of the IPO. Reclassification The equity interests of Pla-Fit Holdings previously consisted of three different classes of limited liability company units (Class M, Class T and Class O). Prior to the completion of the IPO, the limited liability company agreement of Pla-Fit Holdings was amended and restated to, among other things, modify its capital structure to create a single new class of units, the Holdings Units. The Company refers to this capital structure modification as the “Reclassification.” The Direct TSG Investors’ indirect interest in Pla-Fit Holdings was held through Planet Fitness Holdings, L.P. As a result, following the Merger, in which Planet Fitness Holdings, L.P. merged with and into the Company, the Direct TSG Investors’ indirect interests in Pla-Fit Holdings are held through the Company. Therefore, the Holdings Units received in the Reclassification were allocated to: (1) the Continuing LLC Owners based on their existing interests in Pla-Fit Holdings; and (2) the Company to the extent of the Direct TSG Investors’ indirect interest in Pla-Fit Holdings. The number of Holdings Units allocated to the Company in the Reclassification was equal to the number of shares of Class A common stock that the Direct TSG Investors received in the Merger (on a one-for-one basis). The Reclassification was effected on August 5, 2015, prior to the time our Class A common stock was registered under the Exchange Act and prior to the completion of the IPO. Following the Merger and the Reclassification, the Company issued to Continuing LLC Owners 72,602,810 shares of Class B common stock, one share of Class B common stock for each Holdings Unit they held. The shares of Class B common stock have no rights to dividends or distributions, whether in cash or stock, but entitle the holder to one vote per share on matters presented to stockholders of the Company. The Continuing LLC Owners consist of investment funds affiliated with TSG and certain employees and directors. Pursuant to the LLC agreement that went into effect at the time of the Reclassification (“New LLC Agreement”), the Company was designated as the sole managing member of Pla-Fit Holdings. Accordingly, the Company has the right to determine when distributions will be made by Pla-Fit Holdings to its members and the amount of any such distributions (subject to the requirements with respect to the tax distributions described below). If the Company authorizes a distribution by Pla-Fit Holdings, the distribution will be made to the members of Pla-Fit Holdings, including the Company, pro rata in accordance with the percentages of their respective Holdings Units. The holders of Holdings Units will incur U.S. federal, state and local income taxes on their allocable share of any taxable income of Pla-Fit Holdings (as calculated pursuant to the New LLC Agreement). Net profits and net losses of Pla-Fit Holdings will generally be allocated to its members pursuant to the New LLC Agreement pro rata in accordance with the percentages of their respective Holdings Units. The New LLC Agreement provides for cash distributions to the holders of Holdings Units for purposes of funding their tax obligations in respect of the income of Pla-Fit Holdings that is allocated to them, to the extent other distributions from Pla-Fit Holdings for the relevant year have been insufficient to cover such liability. Generally, these tax distributions are computed based on the estimated taxable income of Pla-Fit Holdings allocable to the holders of Holdings Units multiplied by an assumed, combined tax rate equal to the maximum rate applicable to an individual or corporation resident in San Francisco, California (taking into account the non-deductibility of certain expenses and the character of the Company’s income). Exchange agreement Following the Merger and the Reclassification, the Company and the Continuing LLC Owners entered into an exchange agreement under which the Continuing LLC Owners (or certain permitted transferees thereof) have the right, from time to time and subject to the terms of the exchange agreement, to exchange their Holdings Units, along with a corresponding number of shares of Class B common stock, for shares of Class A common stock (or cash at the option of the Company) on a one-for-one basis, subject to customary conversion rate adjustments for stock splits, stock dividends, reclassifications and similar transactions. As a Continuing LLC Owner exchanges Holdings Units, along with a corresponding number of shares of Class B common stock, for shares of Class A common stock, the number of Holdings Units held by the Company will increase by a corresponding amount as it acquires the exchanged Holdings Units and cancels a corresponding number of shares of Class B common stock. Offering transactions In connection with the completion of the IPO on August 11, 2015, in order to facilitate the disposition of equity interests in Pla-Fit Holdings held by Continuing LLC Owners affiliated with TSG, the Company used the net proceeds received to purchase issued and outstanding Holdings Units from these Continuing LLC Owners that they received in the Reclassification. In connection with the IPO, the Company purchased 10,491,055 issued and outstanding Holdings Units from these Continuing LLC Owners for an aggregate of $156,946. This is in addition to the 26,106,930 Holdings Units that the Company acquired in the Reclassification on a one-for-one basis in relation to the number of shares of Class A common stock issued to the Direct TSG Investors in the Merger. Accordingly, following the IPO, the Company holds 36,597,985 Holdings Units, which is equal to the number of shares of Class A common stock that were issued to the Direct TSG Investors and investors in the IPO. The Direct TSG Investors, who did not receive Holdings Units in the Reclassification but received shares of Class A common stock in the Merger, sold 5,033,945 shares of Class A common stock in the IPO as selling stockholders. All expenses of the IPO, other than underwriter discounts and commissions, were borne by Pla-Fit Holdings or reimbursed by Pla-Fit Holdings to the Company and amounted to $7,697 for the year ended December 31, 2015. These amounts were recorded in selling, general, and administrative expense in the accompanying statements of operations and could not be capitalized and offset against the proceeds from the offering because the Company did not retain any of the proceeds from the IPO. As a result of the recapitalization transactions and the offering transactions, upon completion of the IPO: · the investors in the IPO collectively owned 15,525,000 shares of our Class A common, representing 15.7% of the voting power in the Company and, through the Company, 15.7% of the economic interest in Pla-Fit Holdings; · the Direct TSG Investors own 21,072,985 shares of our Class A common stock, representing 21.4% of the voting power in the Company and, through the Company, 21.4% of the economic interest in Pla-Fit Holdings; and · the Continuing LLC Owners collectively hold 62,111,755 Holdings Units, representing 62.9% of the economic interest in Pla-Fit Holdings and 62,111,755 shares of our Class B common stock, representing 62.9% of the voting power in the Company. |
Equity-based Compensation
Equity-based Compensation | 12 Months Ended |
Dec. 31, 2015 | |
Share Based Compensation [Abstract] | |
Equity-based Compensation | (14) Equity-based compensation 2013 Equity Incentive Plan In 2013, the Company’s Board of Directors adopted the 2013 Equity Incentive Plan (the “2013 Plan”). Under the 2013 Plan, the Company has granted awards in the form of Class M Units to employees and directors of the Company and its subsidiaries. The Class M Units receive distributions (other than tax distributions) only upon a liquidity event, as defined, that exceeds a threshold equivalent to the fair value of the Company, as determined by the Company’s Board of Directors, at the grant date. Eighty percent of the awards vest over five years of continuous employment or service while the other twenty percent only vest in the event of an initial public offering of the Company’s common stock or that of its parent or one of its subsidiaries, subject to the holder of the Class M Units remaining employed or providing services on the date of such initial public offering. All awards include a repurchase option at the election of the Company for the vested portion upon termination of employment or service, and have a ten year contractual term. These awards are accounted for as equity at their fair value as of the grant date. The fair value of each award was estimated on the date of grant using a Monte Carlo simulation model. The weighted average assumptions for the grants are provided in the following table. Since the Company’s shares were not publicly traded, expected volatility was estimated based on the average historical volatility of similar entities with publicly traded shares. The term was based on the estimated time to a liquidity event. The risk-free rate for the expected term of the M Unit was is based on the U.S. Treasury yield curve at the date of grant. Valuation assumptions: Year ended December 31, 2014 2013 Expected term (years) 1.70 3.70 Expected volatility 36.8 % 39.4 % Risk-free interest rate 0.4 % 0.8 % Dividend yield — — During the year ended December 31, 2015, the Company modified the vesting terms of 10.737 outstanding Class M Units such that those units are fully vested and eligible to receive distributions following a liquidity event. In connection with the IPO and related recapitalization transactions as described in Note 1, all of the outstanding Class M Units were converted into Holdings Units and Class B common shares of Planet Fitness, Inc. in accordance with the terms of the awards. The Company’s IPO constituted a qualifying event under the terms of the awards and as a result 4,238,338 Holdings Units and corresponding Class B Common shares were issued to the existing Class M Unit holders with a weighted-average grant date fair value of $1.52 per share. The Company recorded $4,731 of compensation expense in the year ended December 31, 2015 related to these awards. The amount of total unrecognized compensation cost related to all awards under this plan was $729 as of December 31, 2015, which is expected to be recognized over a weighted-average period of 2.4 years. A summary of Class M Unit activity is presented below: Class M Units Holdings Units Weighted average grant date fair value Outstanding at January 1, 2013 — $ — Units granted 431.577 — Outstanding at December 31, 2013 431.577 — Units granted 121.051 — Units forfeited (47.368 ) — Outstanding at December 31, 2014 505.260 — Units granted — — Units forfeited (21.053 ) — Units converted upon IPO (484.207 ) 4,238,338 1.52 Outstanding at December 31, 2015 — 4,238,338 1.52 Vested or expected to vest at December 31, 2015 — 4,238,338 1.52 The weighted average grant-date fair value of the Class M Units vested during the years ended December 31, 2014 and 2013 was $10,047 and $10,656 per unit, respectively. During the years ended December 31, 2014 and 2013, 69.052 and 24.421 units vested, respectively, but were not yet exercisable due to the fact that exercisability was contingent on a liquidity event. No distributions were paid under these awards in 2013 or 2014 and no awards were forfeited in 2013. 2015 Omnibus Incentive Plan Stock Options In August 2015, the Company adopted the 2015 Omnibus Incentive Plan (the "2015 Plan") under which the Company may grant options and other equity-based awards to purchase up to 7,896,800 shares to employees, directors and officers. In connection with the IPO, the Company granted options to purchase up to 106,030 shares to certain employees with an exercise price of $16.00 per share. Options to purchase an additional 10,660 shares were granted during the year ended December 31, 2015, with an exercise price of $17.50 per share. All stock options awarded vest annually, on a tranche by tranche basis, over a period of four years. The fair value of stock option awards granted during the year ended December 31, 2015 was determined on the grant date using the Black-Scholes valuation model based on the following weighted-average assumptions: Expected term (years) (1) 6.25 Expected volatility (2) 35.4 % Risk-free interest rate (3) 1.82 % Dividend yield (4) — (1) Expected term represents the estimated period of time until an award is exercised and was determined using the simplified method. (2) Expected volatility is based on the historical volatility of a selected peer group over a period equivalent to the expected term. (3) The risk-free rate is an interpolation of yields on U.S. Treasury securities with maturities equivalent to the expected term. (4) We have assumed a dividend yield of zero as we have no plans to declare dividends in the foreseeable future. A summary of stock option activity for the year ended December 31, 2015: Stock Options Weighted exercise price Weighted average remaining contractual term (years) Outstanding at beginning of period — $ — Granted 116,690 16.14 Exercised — — Forfeited (8,420 ) 16.00 Outstanding at December 31, 2015 108,270 $ 16.15 9.6 Vested or expected to vest at December 31, 2015 104,769 $ 16.15 9.6 The weighted-average grant date fair value of stock options granted during the year ended December 31, 2015 was $6.14. During the year ended December 31, 2015, $131 was recorded to selling, general and administrative expense related to these stock options. As of December 31, 2015, there were 108,270 stock options outstanding none of which were exercisable. The aggregate intrinsic value of stock options outstanding as of December 31, 2015 was $0. As of December 31, 2015, total unrecognized compensation expense related to unvested stock options, including an estimate for pre-vesting forfeitures, was $514, which is expected to be recognized over a weighted-average period of 3.6 years. Restricted stock units During the year ended December 31, 2015, the Company granted 8,160 restricted Class A stock units (“RSUs”) to one member of its Board of Directors under the 2015 Plan. The RSUs granted vest in three equal annual installments beginning on first anniversary of the grant date, provided that the recipient continues to serve on the Board of Directors through the vesting dates. The weighted-average grant date fair value of RSUs granted during the year ended December 31, 2015 was $18.38. During the year ended December 31, 2015, $26 was recorded to selling, general and administrative expense related to these RSUs. As of December 31, 2015, there were 8,160 RSUs outstanding none of which were exercisable. As of December 31, 2015, total unrecognized compensation expense related to unvested RSUs, including an estimate for pre-vesting forfeitures was $124, which is expected to be recognized over a weighted-average period of 2.7 years. |
Earnings per share
Earnings per share | 12 Months Ended |
Dec. 31, 2015 | |
Earnings Per Share [Abstract] | |
Earnings per share | (15) Earnings per share Basic earnings per share of Class A common stock is computed by dividing net income attributable to Planet Fitness, Inc. for the period from August 6, 2015 through December 31, 2015, the period following the recapitalization transactions and IPO, by the weighted-average number of shares of Class A common stock outstanding during the same period. Diluted earnings per share of Class A common stock is computed by dividing net income attributable to Planet Fitness, Inc. by the weighted-average number of shares of Class A common stock outstanding adjusted to give effect to potentially dilutive securities. There were no shares of Class A or Class B common stock outstanding prior to August 6, 2015, therefore no earnings per share information has been presented for any period prior to that date. Shares of the Company’s Class B common stock do not share in the earnings or losses attributable to Planet Fitness, Inc. and are therefore not participating securities. As such, separate presentation of basic and diluted earnings per share of Class B common stock under the two-class method has not been presented. Shares of the Company’s Class B common stock are, however, considered potentially dilutive shares of Class A common stock because shares of Class B common stock, together with the related Holdings Units, are exchangeable into shares of Class A common stock on a one-for-one basis. The following table sets forth reconciliations of the numerators and denominators used to compute basic and diluted earnings per share of Class A common stock: Basic net income per share: August 6, 2015 through December 31, 2015 Numerator Net income $ 23,454 Less: net income attributable to non-controlling interests 19,348 Net income attributable to Planet Fitness, Inc. $ 4,106 Denominator Weighted-average shares of Class A common stock outstanding - basic 36,243,557 Earnings per share of Class A common stock - basic $ 0.11 Class B common stock was evaluated under the if-converted method for potential dilutive effects and were determined to be anti-dilutive. Stock options in the amount of 108,270 and restricted stock units in the amount of 8,160 were evaluated under the treasury stock method for potential dilutive effects and were determined to be anti-dilutive. |
Income taxes
Income taxes | 12 Months Ended |
Dec. 31, 2015 | |
Income Tax Disclosure [Abstract] | |
Income taxes | (16) Income taxes Income before the provision for income taxes as shown in the accompanying consolidated statements of operations is as follows: Year Ended December 31, 2015 2014 2013 Domestic $ 48,716 $ 39,534 $ 26,432 Foreign (1,438 ) (1,056 ) — Total current tax expense 47,278 38,478 26,432 The provision (benefit) for income taxes consists of the following: Year Ended December 31, 2015 2014 2013 Current: Federal $ 686 $ — $ — State 2,188 1,078 2,063 Foreign 139 168 — Total current tax expense 3,013 1,246 2,063 Deferred: Federal 5,636 — — State 935 217 (1,430 ) Foreign (436 ) (280 ) — Total deferred tax (benefit) expense 6,135 (63 ) (1,430 ) Provision for income taxes $ 9,148 $ 1,183 $ 633 As a result of the recapitalization transactions, the Company became the sole managing member of Pla-Fit Holdings, which is treated as a partnership for U.S. federal and most applicable state and local income tax purposes. As a partnership, Pla-Fit Holdings is not subject to U.S. federal and certain state and local income taxes. Any taxable income or loss generated by Pla-Fit Holdings is passed through to and included in the taxable income or loss of its members, including the Company following the recapitalization transactions, on a pro rata basis. Planet Fitness, Inc. is subject to U.S. federal income taxes, in addition to state and local income taxes with respect to our allocable share of any taxable income of Pla-Fit Holdings following the recapitalization transactions. The Company is also subject to taxes in foreign jurisdictions. A reconciliation of the U.S. statutory income tax rate to the Company’s effective tax rate is as follows: Year Ended December 31, 2015 U.S. statutory tax rate 35.0 % State and local taxes, net of federal benefit 6.2 % Rate change on deferred tax asset from recapitalization 6.9 % Tax benefit arrangement liability adjustment (2.1 )% Foreign tax rate differential 0.3 % Withholding taxes and other 0.2 % Income attributable to non-controlling interests (27.1 )% Effective tax rate 19.4 % The Company incurs U.S. federal and state income taxes on its 37.1% share of income flowed through from Pla-Fit Holdings. Our effective tax rate on such income was approximately 39.4%. The provision for income taxes also reflects an effective state tax rate of 2.5% applied to non-controlling interests, representing the remaining 62.9% of income before taxes, excluding income from variable interest entities, related to Pla-Fit Holdings. Deferred income taxes are provided for the effects of temporary differences between the tax basis of an asset or liability and its reported amount in the accompanying consolidated balance sheets. These temporary differences result in taxable or deductible amounts in future years. Details of the Company’s deferred tax assets and liabilities are summarized as follows: Year Ended December 31, 2015 2014 Deferred tax assets: Accrued expense and reserves $ 353 $ 75 Deferred revenue 1,276 182 Goodwill and intangible assets 113,460 - Net operating loss 716 280 Other 2,841 85 Deferred tax assets $ 118,646 $ 622 Deferred tax liabilities: Prepaid expenses (674 ) (94 ) Goodwill and intangible assets - (717 ) Property and equipment (614 ) (154 ) Total deferred tax liabilities $ (1,288 ) $ (965 ) Total deferred tax assets and liabilities $ 117,358 $ (343 ) The Company has net operating loss carryforwards related to its Canada operations of approximately $716, which begin to expire in 2034. It is more likely than not that the results of future operations will generate sufficient taxable income to realize the deferred tax assets. As of December 31, 2015 and 2014, the total liability related to uncertain tax positions is $300. The amount of unrecognized tax benefit, if recognized, would reduce income tax expense by $300. The Company does not expect the amount of unrecognized tax benefits to change materially in the next twelve months. The Company recognizes interest accrued and penalties, if applicable, related to unrecognized tax benefits in income tax expense. Interest and penalties for the year ended December 31, 2015 were not material. Tax benefit arrangements The Company’s acquisition of Holdings Units in connection with the IPO and future and certain past exchanges of Holdings Units for shares of the Company’s Class A common stock (or cash at the option of the Company) are expected to produce and have produced favorable tax attributes. In connection with the IPO, the Company entered into two tax receivable agreements. Under the first of those agreements, the Company generally is required to pay to the Continuing LLC Owners 85% of the applicable tax savings, if any, in U.S. federal and state income tax that the Company is deemed to realize as a result of certain tax attributes of their Holdings Units sold to the Company (or exchanged in a taxable sale) and that are created as a result of (i) the sales of their Holdings Units for shares of Class A common stock and (ii) tax benefits attributable to payments made under the tax receivable agreement (including imputed interest). Under the second tax receivable agreement, the Company generally is required to pay to the Direct TSG Investors 85% of the amount of tax savings, if any, that the Company is deemed to realize as a result of the tax attributes of the Holdings Units held in respect of the Direct TSG Investors’ interest in the Company, which resulted from the Direct TSG Investors’ purchase of interests in Pla-Fit Holdings in 2012, and certain other tax benefits. Under both agreements, the Company generally retains the benefit of the remaining 15% of the applicable tax savings. Also, pursuant to the exchange agreement (see Note 13), to the extent an exchange results in Pla-Fit Holdings, LLC incurring a current tax liability relating to the New Hampshire business profits tax, the Continuing LLC Owners have agreed that they will contribute to Pla-Fit Holdings, LLC an amount sufficient to pay such tax liability (up to 3.5% of the value received upon exchange). If and when the Company subsequently realizes a related tax benefit, Pla-Fit Holdings, LLC will distribute the amount of any such tax benefit to the relevant Continuing LLC Owner in respect of its contribution. The Company recorded other income of $2,549 in the year ended December 31, 2015 reflecting a reduction in the tax benefit obligation attributable to a reduction in the expected related tax benefits. The tax benefit obligation was $140,191 as of December 31, 2015. Projected future payments under the tax benefit arrangements are as follows: Amount 2016 $ 3,019 2017 7,125 2018 7,072 2019 7,125 2020 7,321 Thereafter 108,529 Total $ 140,191 |
Commitments and contingencies
Commitments and contingencies | 12 Months Ended |
Dec. 31, 2015 | |
Commitments And Contingencies Disclosure [Abstract] | |
Commitments and contingencies | (17) Commitments and contingencies (a) Operating lease commitments The Company rents equipment, office, and warehouse space at various locations in the United States and Canada under noncancelable operating leases. Rental expense was $18,186, $16,980, and $13,830 for the years ended December 31, 2015, 2014 and 2013, respectively. Approximate annual future commitments under noncancelable operating leases as of December 31, 2015 are as follows: Amount 2016 $ 13,272 2017 12,700 2018 11,738 2019 10,325 2020 9,245 Thereafter 44,802 Total $ 102,082 (b) Legal matters From time to time, and in the ordinary course of business, the Company is subject to various claims, charges, and litigation, such as employment-related claims and slip and fall cases. The Company is not currently aware of any legal proceedings or claims that the Company believes will have, individually or in the aggregate, a material adverse effect on the Company’s financial position or result of operations. (c) Purchase commitments As of December 31, 2015, the Company had advertising purchase commitments of approximately $15,530, including commitments made by the NAF. In addition, the Company had open purchase orders of approximately $14,361 primarily related to equipment to be sold to franchisees. (d) Guarantees The Company has guaranteed certain leases and debt agreements of entities that were previously related through common ownership. These guarantees relate to leases for operating space, equipment, and other operating costs of franchises operated by the related entities. The Company’s maximum obligation, as a result of its guarantees of leases and debt, is approximately $1,871 and $2,896 as of December 31, 2015 and 2014, respectively, and would only require payment upon default by the primary obligor. The Company has determined the fair value of these guarantees at inception is not material, and as of December 31, 2015 and 2014, no accrual has been recorded for the Company’s potential obligation under its guaranty arrangement. (e) Performance incentive plan During 2013, the Company adopted the 2013 Performance Incentive Plan, which called for pre-determined bonuses to be paid to employees of the Company upon a future liquidity event of the Company, including an initial public offering that exceeds a predetermined threshold. In connection with the IPO, the Company paid bonuses and recorded expense of $1,688 related to this plan, which are included in selling, general and administrative expense in the accompanying statement of operations. |
Retirement Plan
Retirement Plan | 12 Months Ended |
Dec. 31, 2015 | |
Compensation And Retirement Disclosure [Abstract] | |
Retirement Plan | (18) Retirement Plan The Company maintains a 401(k) deferred tax savings plan (the Plan) for eligible employees. The Plan provides for the Company to make an employer matching contribution currently equal to 100% of employee deferrals up to a maximum of 4% of each eligible participating employees’ wages. Total employer matching contributions expensed in the consolidated statements of operations were approximately $384, $211, and $214 for the years ended December 31, 2015, 2014, and 2013, respectively. |
Segments
Segments | 12 Months Ended |
Dec. 31, 2015 | |
Segment Reporting [Abstract] | |
Segments | (19) Segments The Company has three reportable segments: (i) Franchise; (ii) Corporate-owned stores; and (iii) Equipment. The Company’s operations are organized and managed by type of products and services and segment information is reported accordingly. The Company’s chief operating decision maker (the “CODM”) is its Chief Executive Officer. The CODM reviews financial performance and allocates resources by reportable segment. There have been no operating segments aggregated to arrive at the Company’s reportable segments. The Franchise segment includes operations related to the Company’s franchising business in the United States, Puerto Rico, Canada, and Dominican Republic. The Corporate-owned stores segment includes operations with respect to all Corporate-owned stores throughout the United States and Canada. The Equipment segment includes the sale of equipment to franchisee-owned stores. The accounting policies of the reportable segments are the same as those described in Note 2. The Company evaluates the performance of its segments and allocates resources to them based on revenue and earnings before interest, taxes, depreciation, and amortization, referred to as Segment EBITDA. Revenues for all operating segments include only transactions with unaffiliated customers and include no intersegment revenues. The tables below summarize the financial information for the Company’s reportable segments for the years ended December 31, 2015, 2014 and 2013. The “Corporate and other” column, as it relates to Segment EBITDA, primarily includes corporate overhead costs, such as payroll and related benefit costs and professional services which are not directly attributable to any individual segment. Year Ended December 31, 2015 2014 2013 Revenue Franchise segment revenue – U.S. $ 87,299 $ 71,806 $ 44,157 Franchise segment revenue – International 786 — — Franchise segment total 88,085 71,806 44,157 Corporate-owned stores segment – U.S. 95,459 85,022 67,364 Corporate-owned stores segment – International 2,931 19 — Corporate-owned stores segment total 98,390 85,041 67,364 Equipment segment – U.S. 144,062 122,930 99,488 Equipment segment total 144,062 122,930 99,488 Total revenue $ 330,537 $ 279,777 $ 211,009 Franchise segment revenue includes franchise revenue and commission income. Franchise revenue includes revenue generated from placement services of $9,806, $8,450, and $6,315 for the years ended December 31, 2015, 2014 and 2013, respectively. Year Ended December 31, 2015 2014 2013 Segment EBITDA Franchise $ 66,030 $ 53,109 $ 30,123 Corporate-owned stores 36,070 31,705 21,742 Equipment 31,936 26,447 19,791 Corporate and other (30,051 ) (18,642 ) (7,504 ) Total Segment EBITDA $ 103,985 $ 92,619 $ 64,152 The following table reconciles total Segment EBITDA to income before taxes: Year Ended December 31, 2015 2014 2013 Total Segment EBITDA $ 103,985 $ 92,619 $ 64,152 Less: Depreciation and amortization 32,158 32,341 28,808 Other expense (275 ) (1,261 ) (694 ) Income from operations 72,102 61,539 36,038 Interest expense, net (24,549 ) (21,800 ) (8,912 ) Other expense (275 ) (1,261 ) (694 ) Income before income taxes $ 47,278 $ 38,478 $ 26,432 The following table summarizes the Company’s assets by reportable segment: December 31, 2015 December 31, 2014 Franchise $ 206,997 $ 216,985 Corporate-owned stores 151,620 157,868 Equipment 208,168 220,367 Unallocated 132,392 6,762 Total consolidated assets $ 699,177 $ 601,982 The table above includes $3,149 and $2,011 of long-lived assets located in the Company’s international corporate-owned stores as of December 31, 2015 and 2014 The following table summarizes the Company’s goodwill by reportable segment: December 31, 2015 December 31, 2014 Franchise $ 16,938 $ 16,938 Corporate-owned stores 67,377 67,377 Equipment 92,666 92,666 Total consolidated goodwill $ 176,981 $ 176,981 |
Corporate-owned and franchisee-
Corporate-owned and franchisee-owned stores | 12 Months Ended |
Dec. 31, 2015 | |
Other Industries [Abstract] | |
Corporate-owned and franchisee-owned stores | (20) Corporate-owned and franchisee-owned stores The following table shows changes in our corporate-owned and franchisee-owned stores for the years ended December 31, 2015, 2014 and 2013: Year Ended December 31, 2015 2014 2013 Franchisee-owned stores: Stores operated at beginning of period 863 704 562 New stores opened 206 169 148 Stores debranded, sold or consolidated (1) (3 ) (10 ) (6 ) Stores operated at end of period 1,066 863 704 Corporate-owned stores: Stores operated at beginning of period 55 45 44 New stores opened 3 2 1 Stores acquired from franchisees — 8 - Stores operated at end of period 58 55 45 Total stores: Stores operated at beginning of period 918 749 606 New stores opened 209 171 149 Stores debranded, sold or consolidated (1) (3 ) (2 ) (6 ) Stores operated at end of period 1,124 918 749 (1) The term “debrand” refers to a franchisee-owned store whose right to use the Planet Fitness brand and marks has been terminated due to non-compliance with brand standards in accordance with the franchise agreement. We retain the right to prevent debranded stores from continuing to operate as fitness centers. The term “consolidated” refers to the combination of a franchisee’s store with another store located in close proximity with our prior approval. This often coincides with an enlargement, re-equipment and/or refurbishment of the remaining store. |
Quarterly financial data (unaud
Quarterly financial data (unaudited) | 12 Months Ended |
Dec. 31, 2015 | |
Quarterly Financial Information Disclosure [Abstract] | |
Quarterly financial data (unaudited) | (21) Quarterly financial data (unaudited) For the quarter ended March 31, 2015 June 30, 2015 September 30, 2015 December 31, 2015 Total revenue $ 76,923 $ 78,952 $ 68,817 $ 105,845 Income from operations 14,304 18,667 10,338 28,793 Net income 8,541 11,612 737 17,240 Earnings per share (1) August 6 through September 30, 2015 For the quarter ended December 31, 2015 Class A - Basic $ 0.05 $ 0.06 Class A - Diluted $ 0.04 $ 0.06 For the quarter ended March 31, 2014 June 30, 2014 September 30, 2014 December 31, 2014 Total revenue $ 57,594 $ 62,697 $ 63,467 $ 96,019 Income from operations 13,539 14,706 13,956 19,338 Net income 6,259 8,950 8,303 13,783 (1) Represents earnings per share of Class A common stock and weighted-average shares of Class A common stock outstanding for the periods from August 6, 2015 through September 30, 2015 and the quarter ended December 31, 2015, the periods following the recapitalization transactions and IPO (see Note 15). |
Summary of significant accoun29
Summary of significant accounting policies (Policies) | 12 Months Ended |
Dec. 31, 2015 | |
Accounting Policies [Abstract] | |
Basis of presentation and consolidation | (a) Basis of presentation and consolidation The accompanying consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (U.S. GAAP) and pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”). All significant intercompany balances and transactions have been eliminated in consolidation. As discussed in Note 1, as a result of the recapitalization transactions, Planet Fitness, Inc. consolidates Pla-Fit Holdings and Pla-Fit Holdings is considered to be the predecessor to Planet Fitness, Inc. for accounting and reporting purposes. The Company also consolidates entities in which it has a controlling financial interest, the usual condition of which is ownership of a majority voting interest. The Company also considers for consolidation certain interests where the controlling financial interest may be achieved through arrangements that do not involve voting interests. Such an entity, known as a variable interest entity (“VIE”), is required to be consolidated by its primary beneficiary. The primary beneficiary of a VIE is considered to possess the power to direct the activities of the VIE that most significantly impact its economic performance and has the obligation to absorb losses or the rights to receive benefits from the VIE that are significant to it. The principal entities in which the Company possesses a variable interest include franchise entities and certain other entities. The Company is not deemed to be the primary beneficiary for Planet Fitness franchise entities. Therefore, these entities are not consolidated. The results of the Company have been consolidated with Matthew Michael Realty LLC (“MMR”) and PF Melville LLC (“PF Melville”) based on the determination that the Company is the primary beneficiary with respect to these VIEs. These entities are real estate holding companies that derive a majority of their financial support from the Company through lease agreements for corporate stores. See Note 3 for further information related to the Company’s VIEs. |
Use of estimates | (b) Use of estimates The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes. Although these estimates are based on management’s knowledge of current events and actions it may undertake in the future, they may ultimately differ from actual results. Significant areas where estimates and judgments are relied upon by management in the preparation of the consolidated financial statements include revenue recognition, valuation of assets and liabilities in connection with acquisitions, valuation of equity-based compensation awards, the evaluation of the recoverability of goodwill and long-lived assets, including intangible assets, income taxes, including deferred tax assets and liabilities and reserves for unrecognized tax benefits, and the liability for the Company’s tax benefit arrangements. |
Concentrations | (c) Concentrations Cash and cash equivalents are financial instruments, which potentially subject the Company to a concentration of credit risk. The Company invests its excess cash in several major financial institutions, which are insured by the Federal Deposit Insurance Corporation (FDIC) up to $250,000. The Company maintains balances in excess of these limits, but does not believe that such deposits with its banks are subject to any unusual risk. The credit risk associated with trade receivables is mitigated due to the large number of customers, generally our franchisees, and their broad dispersion over many different geographic areas. We do not have any concentrations with respect to our revenues. The Company purchases equipment, both for corporate-owned stores and for sales to franchisee-owned stores, from two primary vendors. For the year ended December 31, 2015 purchases from these two vendors comprised 79% and 18%, respectively, for the year ended December 31, 2014 purchases from these two vendors comprised 66% and 25%, respectively, and for the year ended December 31, 2013 purchases from these two vendors comprised 66% and 27%, respectively, of total equipment purchases. The Company, including Planet Fitness NAF, LLC (“NAF”) uses one primary vendor for advertising services. Purchases from this vendor totaled 49%, 61%, and 68% of total advertising purchases for the years ended December 31, 2015, 2014 and 2013, respectively (see Note 5 for further discussion of NAF). |
Cash and cash equivalents | (d) Cash and cash equivalents The Company considers all highly liquid investments purchased with an original maturity of 90 days or less to be cash equivalents. Cash held within the NAF is recorded as a restricted asset (see Note 5). |
Revenue recognition | (e) Revenue recognition Franchise revenue The following revenues are generated as a result of transactions with or related to the Company’s franchisees. Area development fees Franchisees contractually enter into area development agreements (ADAs) to secure the exclusive right to open franchise stores within a defined geographical area. ADAs establish the timing and number of stores to be developed within the defined geographical area. Pursuant to an ADA, a franchisee is generally required to pay an initial nonrefundable development fee for a minimum number of stores to be developed, as outlined in the respective ADA. ADA fees collected in advance are deferred until the Company provides substantially all required obligations pursuant to the ADA. As the efforts and total cost relating to initial services are affected significantly by the number of stores opened in an area, the respective ADA is treated as a divisible contract. As each new site is accepted under an ADA, a franchisee signs a franchise operating agreement for the respective franchise location. As each store opened under an ADA typically has performance obligations associated with it, the Company recognizes ADA revenue as each individual franchise location is developed in proportion to the total number of stores to be developed under the ADA. These obligations are typically completed once the store is opened or the franchisee executes the individual property lease. As of December 31, 2015 and 2014, the deferred revenue for ADAs was $10,471 and $8,215, respectively. ADAs generally have an initial term equal to the number of years over which the franchisee is required to open franchise stores, which is typically 5 to 10 years. There is no right of refund for an executed ADA. Upon default, as defined in the agreement, the Company may reacquire the rights pursuant to an ADA, and all remaining deferred revenue is recognized at that time. Franchise fees and performance fees For stores opened without an ADA, the Company generally charges an initial upfront nonrefundable franchise fee. Nonrefundable franchise fees are typically deferred until the franchisee executes a lease and receives initial training for the location, which is the point at which the Company has determined it has provided all of its material obligations required to recognize revenue. As of December 31, 2015 and 2014, the Company has recorded deferred franchise fees of $473 and $205, respectively, relating to stores to be opened in future years. These amounts are included in deferred revenue as of December 31, 2015 and 2014. The individual franchise agreements typically have a 10-year initial term, but provide the franchisee with an opportunity to enter into successive renewals subject to certain conditions. Franchise agreements entered into prior to 2010 may include performance fees, which are fees earned by the Company upon each franchise store reaching a predetermined amount of total monthly membership billings. Performance fees are recognized when the related performance thresholds have been met. Royalties Royalties, which represent recurring fees paid by franchisees based on the franchisee-owned stores’ monthly membership billings, are recognized on a monthly basis over the term of the franchise agreement. As specified under certain franchise agreements, the Company recognizes additional royalty fees as the franchisee-owned stores attain contractual monthly membership billing threshold amounts. Beginning in 2010, for all new franchise agreements entered into, the Company began charging a fixed royalty percentage based upon gross membership billings. Other fees Online member join fees are paid to the Company by franchisees for processing new membership transactions when a new member signs up for a membership to a franchisee-owned store through the Company’s website. Billing transaction fees are paid to the Company for the processing of franchisee membership dues and annual fees through the Company’s third-party hosted point-of-sale system. Placement The Company is generally responsible for assembly and placement of equipment it sells to franchisee-owned stores. Placements revenue is recognized upon completion and acceptance of the services at the franchise location. Commission income The Company recognizes commission income from its franchisees’ use of preferred vendor arrangements. Commissions are recognized when amounts have been earned and collectability from the vendor is reasonably assured. Corporate-owned stores revenue The following revenues are generated from stores owned and operated by the Company. Membership dues revenue Customers are offered multiple membership choices varying in length. Membership dues are earned and recognized over the membership term on a straight-line basis. Enrollment fee revenue Enrollment fees are charged to new members at the commencement of their membership. The Company recognizes enrollment fees ratably over the estimated duration of the membership life, which is generally two years. Annual membership fee revenue Annual membership fees are annual fees charged to members in addition to and in order to maintain low monthly membership dues. The Company recognizes annual membership fees ratably over the 12-month membership period. Retail sales The Company sells Planet Fitness branded apparel, food, beverages, and other accessories. The revenue for these items is recognized at the point of sale. Equipment revenue The Company sells and delivers equipment purchased from third-party equipment manufacturers to U.S. based franchisee-owned stores. Equipment revenue is recognized upon the equipment being delivered to and assembled at each store and accepted by the franchisee. Franchisees are charged for all freight costs incurred for the delivery of equipment. Freight revenue is recorded within equipment revenue and freight costs are recorded within cost of revenue. The Company recognizes revenue on a gross basis in these transactions as management has determined the Company to be the principal in these transactions. Management determined the Company to be the principal because the Company is the primary obligor in these transactions, the Company has latitude in establishing prices for the equipment sales to franchisees, the Company has supplier selection discretion and is involved in determination of product specifications, and the Company bears all credit risk associated with obligations to the equipment manufacturers. Equipment deposits are recognized as a liability on the accompanying consolidated balance sheets until delivery, assembly (if required), and acceptance by the franchisee. As of December 31, 2015 and 2014, equipment deposits were $5,587 and $6,675, respectively. Sales tax All revenue amounts are recorded net of applicable sales tax. |
Deferred revenue | (f) Deferred revenue Deferred revenue represents cash received from franchisees for ADAs and franchise fees for which revenue recognition criteria has not yet been met and cash received from members for enrollment fees, membership dues and annual fees for the portion not yet earned based on the membership period. |
Cost of revenue | (g) Cost of revenue Cost of revenue consists of direct costs associated with equipment sales, including freight costs, direct costs related to the maintenance and support of the Company’s proprietary system-wide point-of-sale system, and the cost of retail merchandise sold in corporate-owned stores. Costs related to the point-of-sale system were $1,236, $3,385, and $1,107 for the years ended December 31, 2015, 2014 and 2013 respectively. Costs related to retail merchandise were immaterial in all periods presented. Rebates from equipment vendors where the Company has recognized the related equipment revenue and costs are recorded as a reduction to the cost of revenue. |
Store operations | (h) Store operations Store operations consists of the direct costs related to operating corporate-owned stores, including our store management and staff, rent expense, utilities, supplies, maintenance, and local advertising. |
Selling, general and administrative | (i) Selling, general and administrative Selling, general and administrative expenses consist of costs associated with administrative and franchisee support functions related to our existing business as well as growth and development activities. These costs primarily consist of payroll, IT related, marketing, legal and accounting expenses. These expenses include costs related to placement services of $3,452, $2,743, and $2,245, for the years ended December 31, 2015, 2014 and 2013, respectively. |
Accounts and notes receivable | (j) Accounts and notes receivable Accounts receivable is primarily comprised of amounts owed to the Company resulting from equipment, placement, and commission revenue. Notes receivable arise primarily from financing activities with franchisees. The Company evaluates its accounts and notes receivable on an ongoing basis and may establish an allowance for doubtful accounts based on collections and current credit conditions. Accounts are written off as uncollectible when it is determined that further collection efforts will be unsuccessful. Notes receivable are generally secured by all property, assets, and rights owned by the franchisee. Historically, the Company has not had a significant amount of write-offs. |
Leases and asset retirement obligations | (k) Leases and asset retirement obligations The Company recognizes rent expense related to leased office and operating space on a straight-line basis over the term of the lease. The difference between rent expense and rent paid, if any, as a result of escalation provisions and lease incentives, such as tenant improvements provided by lessors, and is recorded as deferred rent in the Company’s consolidated balance sheets. In accordance with ASC Topic 410, Asset Retirement and Environmental Obligations |
Property and equipment | (l) Property and equipment Property and equipment is recorded at cost and depreciated using the straight-line method over its related estimated useful life. Leasehold improvements are amortized over the shorter of the lease term or the estimated useful life of the related asset, whichever is shorter. Upon sale or retirement, the asset cost and related accumulated depreciation are removed from the respective accounts, and any related gain or loss is reflected in the consolidated statements of operations. Ordinary maintenance and repair costs are expensed as incurred. The estimated useful lives of the Company’s fixed assets by class of asset are as follows: Years Buildings and building improvements 20–40 Computers and equipment 3 Furniture and fixtures 5 Leasehold improvements Useful life or term of lease whichever is shorter Fitness equipment 5–7 Vehicles 5 |
Advertising expenses | (m) Advertising expenses The Company expenses advertising costs as incurred. Advertising expenses, net of amounts reimbursed by franchisees, are included within selling, general and administrative expenses and totaled $9,349, $7,272, and $5,731 for the years ended December 31, 2015, 2014 and 2013, respectively. See Note 5 for discussion of the national advertising fund. |
Goodwill, long-lived assets, and other intangible assets | (n) Goodwill, long-lived assets, and other intangible assets Goodwill and other intangible assets that arise from acquisitions are recorded in accordance with ASC Topic 350, Intangibles—Goodwill and Other Goodwill and indefinite-lived intangible assets are not amortized, but are reviewed annually for impairment or more frequently if impairment indicators arise. Separable intangible assets that are not deemed to have an indefinite life are amortized over their estimated useful lives on either a straight-line or accelerated basis as deemed appropriate, and are reviewed for impairment when events or circumstances suggest that the assets may not be recoverable. The Company performs its annual test for impairment of goodwill and indefinite lived intangible assets on December 31 of each year. For goodwill, the first step of the impairment test is to determine whether the carrying amount of a reporting unit exceeds the fair value of the reporting unit. If the carrying amount of the reporting unit exceeds the reporting unit’s fair value, the Company would be required to perform a second step of the impairment test as this is an indication that the reporting unit’s goodwill may be impaired. The second step compares the implied fair value of the reporting unit’s goodwill with the carrying amount of that goodwill. Any impairment loss would be recognized in an amount equal to the excess of the carrying value of the goodwill over the implied fair value of the goodwill. The Company is also permitted to make a qualitative assessment of whether it is more likely than not that a reporting unit’s fair value is less than its carrying amount before applying the two-step goodwill impairment test. If the Company concludes it is not more likely than not that the fair value of a reporting unit is less than its carrying amount, it need not perform the two-step impairment test. For indefinite lived intangible assets, the impairment assessment consists of comparing the carrying value of the asset to its estimated fair value. To the extent that the carrying value exceeds the fair value of the asset, an impairment is recorded to reduce the carrying value to its fair value. The Company is also permitted to make a qualitative assessment of whether it is more likely than not an indefinite lived intangible asset’s fair value is less than its carrying value prior to applying the quantitative assessment. If based on the Company’s qualitative assessment it is not more likely than not that the carrying value of the asset is less than its fair value, then a quantitative assessment is not required. The Company determined that no impairment charges were required during any periods presented. The Company applies the provisions of ASC Topic 360, Property, Plant and Equipment |
Income taxes | (o) Income taxes The Company accounts for income taxes using the asset and liability method. Deferred income taxes are recognized for the expected future tax consequences attributable to temporary differences between the carrying amount of the existing tax assets and liabilities and their respective tax basis. Deferred tax assets and liabilities are measured using enacted tax rates expected to be applied in the years in which temporary differences are expected to be recovered or settled. The principal items giving rise to temporary differences are the use of accelerated depreciation and certain basis differences resulting from acquisitions and the recapitalization transactions. Valuation allowances are established when necessary to reduce deferred tax assets to the amount expected to be realized. As a result of the recapitalization transactions, Planet Fitness, Inc. became the sole managing member of Pla-Fit Holdings, which is treated as a partnership for U.S. federal and most applicable state and local income tax purposes. As a partnership, Pla-Fit Holdings is not subject to U.S. federal and certain state and local income taxes. Any taxable income or loss generated by Pla-Fit Holdings is passed through to and included in the taxable income or loss of its members, including Planet Fitness, Inc. following the recapitalization transactions, on a pro rata basis. Planet Fitness, Inc. is subject to U.S. federal income taxes, in addition to state and local income taxes with respect to our allocable share of any taxable income of Pla-Fit Holdings following the recapitalization transactions. The Company is also subject to taxes in foreign jurisdictions. The Company recognizes the effect of income tax positions only if those positions are more likely than not to be sustained. Recognized income tax positions are measured at the largest amount that is greater than 50% likely of being realized. Changes in recognition or measurement are reflected in the period in which the change in judgment occurs (see Note 16). During 2013 the Company changed its position with respect to taxes due on interest and dividends to the state of New Hampshire that had previously been paid by the members. This resulted in the Company making tax payments in 2013 totaling $4,392 for periods prior to November 7, 2012. This amount is included within other income (expense) for the year ended December 31, 2013 and is fully offset by amounts received from the members as reimbursement for the taxes paid, also recorded within other income (expense) for the year ended December 31, 2013. This position is not available for periods subsequent to November 7, 2012 and therefore taxes on interest and dividends due and payable in the periods after 2012 are paid by the members of Pla-Fit Holdings. |
Tax benefit arrangements | (p) Tax benefit arrangements The Company’s acquisition of Holdings Units in connection with the IPO and future and certain past exchanges of Holdings Units for shares of the Company’s Class A common stock (or cash at the option of the Company) are expected to produce and have produced favorable tax attributes. In connection with the IPO, the Company entered into two tax receivable agreements. Under the first of those agreements, the Company generally is required to pay to the Continuing LLC Owners 85% of the applicable tax savings, if any, in U.S. federal and state income tax that the Company is deemed to realize as a result of certain tax attributes of their Holdings Units sold to the Company (or exchanged in a taxable sale) and that are created as a result of (i) the sales of their Holdings Units for shares of Class A common stock and (ii) tax benefits attributable to payments made under the tax receivable agreement (including imputed interest). Under the second tax receivable agreement, the Company generally is required to pay to the Direct TSG Investors 85% of the amount of tax savings, if any, that the Company is deemed to realize as a result of the tax attributes of the Holdings Units held in respect of the Direct TSG Investors’ interest in the Company, which resulted from the Direct TSG Investors’ purchase of interests in Pla-Fit Holdings in 2012, and certain other tax benefits. Under both agreements, the Company generally retains the benefit of the remaining 15% of the applicable tax savings. Also, pursuant to the exchange agreement, to the extent an exchange results in Pla-Fit Holdings, LLC incurring a current tax liability relating to the New Hampshire business profits tax, the Continuing LLC Owners have agreed that they will contribute to Pla-Fit Holdings, LLC an amount sufficient to pay such tax liability (up to 3.5% of the value received upon exchange). If and when the Company subsequently realizes a related tax benefit, Pla-Fit Holdings, LLC will distribute the amount of any such tax benefit to the relevant Continuing LLC Owner in respect of its contribution. Based on current projections, the Company anticipates having sufficient taxable income to utilize these tax attributes and receive corresponding tax deductions in future periods. Accordingly, at the completion of the Reorganization Transactions and the IPO, the Company has recorded an initial liability of $142.0 million payable to the Direct TSG Investors and the Continuing LLC Owners under the tax benefit obligations, representing approximately 85% of the calculated tax savings based on the original basis adjustments the Company anticipates being able to utilize in future years. Changes in the projected liability resulting from these tax benefit arrangements may occur based on changes in anticipated future taxable income, changes in applicable tax rates or other changes in tax attributes that may occur and impact the expected future tax benefits to be received by the Company. Changes in the projected liability under these tax benefit arrangements will be recorded as a component of other income (expense) each period. The projection of future taxable income involves significant judgment. Actual taxable income may differ from estimates, which could significantly impact the liability under the tax benefit arrangements and the Company’s consolidated results of operations. |
Fair Value | (q) Fair value ASC 820, Fair Value Measurements and Disclosures Level 1—Inputs to the valuation methodology are quoted prices (unadjusted) for identical assets or liabilities in active markets. Level 2—Inputs to the valuation methodology include quoted prices for similar assets and liabilities in active markets, and inputs that are observable for the asset or liability, either directly or indirectly, for substantially the full term of the financial instrument. Level 3—Inputs to the valuation methodology are unobservable and significant to the fair value measurement. The table below presents information about the Company’s assets and liabilities that are measured at fair value on a recurring basis as of December 31, 2015 and December 31, 2014: Quoted Significant Total fair prices other Significant value at in active observable unobservable December 31, markets inputs inputs 2015 (Level 1) (Level 2) (Level 3) Interest rate caps $ 1,147 $ — $ 1,147 $ — Quoted Significant Total fair prices other Significant value at in active observable unobservable December 31, markets inputs inputs 2014 (Level 1) (Level 2) (Level 3) Interest rate caps $ 1,711 $ — $ 1,711 $ — |
Financial instruments | (r) Financial instruments The carrying values of cash and cash equivalents, accounts receivable and accounts payable approximate fair value because of the short-term nature of these instruments. The carrying value of debt also approximates fair value as it is variable rate debt. The Company has determined that the determination of fair value of amounts due from related parties under long-term arrangements is impracticable given the related-party nature of these agreements. |
Derivative instruments and hedging activities | (s) Derivative instruments and hedging activities The Company recognizes all derivative instruments as either assets or liabilities in the balance sheet at their respective fair values. For derivatives designated in hedging relationships, changes in the fair value are either offset through earnings against the change in fair value of the hedged item attributable to the risk being hedged or recognized in accumulated other comprehensive income, to the extent the derivative is effective at offsetting the changes in cash flows being hedged until the hedged item affects earnings. The Company only enters into derivative contracts that it intends to designate as a hedge of a forecasted transaction or the variability of cash flows to be received or paid related to a recognized asset or liability (cash flow hedge). For all hedging relationships, the Company formally documents the hedging relationship and its risk-management objective and strategy for undertaking the hedge, the hedging instrument, the hedged transaction, the nature of the risk being hedged, how the hedging instrument’s effectiveness in offsetting the hedged risk will be assessed prospectively and retrospectively, and a description of the method used to measure ineffectiveness. The Company also formally assesses, both at the inception of the hedging relationship and on an ongoing basis, whether the derivatives that are used in hedging relationships are highly effective in offsetting changes in cash flows of hedged transactions. For derivative instruments that are designated and qualify as part of a cash flow hedging relationship, the effective portion of the gain or loss on the derivative is reported as a component of other comprehensive income and reclassified into earnings in the same period or periods during which the hedged transaction affects earnings. Gains and losses on the derivative representing either hedge ineffectiveness or hedge components excluded from the assessment of effectiveness are recognized in current earnings. The Company discontinues hedge accounting prospectively when it determines that the derivative is no longer effective in offsetting cash flows attributable to the hedged risk, the derivative expires or is sold, terminated, or exercised, the cash flow hedge is de-designated because a forecasted transaction is not probable of occurring, or management determines to remove the designation of the cash flow hedge. In all situations in which hedge accounting is discontinued and the derivative remains outstanding, the Company continues to carry the derivative at its fair value on the balance sheet and recognizes any subsequent changes in its fair value in earnings. When it is probable that a forecasted transaction will not occur, the Company discontinues hedge accounting and recognizes immediately in earnings gains and losses that were accumulated in other comprehensive income related to the hedging relationship. See Note 10 for further information. |
Equity-based compensation | (t) Equity-based compensation The Company has an equity-based compensation plan under which it receives services from employees as consideration for equity instruments of the Company. The compensation expense is determined based on the fair value of the award as of the grant date. Compensation expense is recognized over the vesting period, which is the period over which all of the specified vesting conditions are satisfied. For awards with graded vesting, the fair value of each tranche is recognized over its respective vesting period. See Note 14 for further information. |
Guarantees | (u) Guarantees The Company, as a guarantor, is required to recognize, at inception of the guaranty, a liability for the fair value of the obligation undertaken in issuing the guarantee. See Notes 3 and 17 for further discussion of such obligations guaranteed. |
Contingencies | (v) Contingencies The Company records estimated future losses related to contingencies when such amounts are probable and estimable. The Company includes estimated legal fees related to such contingencies as part of the accrual for estimated future losses. |
Reclassifications | (w) Reclassifications Certain amounts have been reclassified to conform to current year presentation, including deferred financing costs, which were previously classified in other assets, net and are now classified as a direct reduction of long-term debt, see Note 2(w). |
Recent accounting pronouncements | (x) Recent accounting pronouncements The FASB issued ASU No. 2015-03, Simplifying the Presentation of Debt Issuance Costs, The FASB issued ASU No. 2015-02, Income Statement—Consolidation, The FASB issued ASU No. 2014-09, Revenue from Contracts with Customers, In September 2015, the FASB issued Accounting Standards Update No. 2015-16, Business Combinations (Topic 805): Simplifying the Accounting for Measurement-Period Adjustments In November 2015, the FASB issued Accounting Standards Update No. 2015-17, Income Taxes (Topic 740): Balance Sheet Classification of Deferred Taxes |
Summary of significant accoun30
Summary of significant accounting policies (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Accounting Policies [Abstract] | |
Schedule of Estimated Useful Lives of Fixed Assets | The estimated useful lives of the Company’s fixed assets by class of asset are as follows: Years Buildings and building improvements 20–40 Computers and equipment 3 Furniture and fixtures 5 Leasehold improvements Useful life or term of lease whichever is shorter Fitness equipment 5–7 Vehicles 5 |
Summary of Company's Assets and Liabilities Measured at Fair Value on Recurring Basis | The table below presents information about the Company’s assets and liabilities that are measured at fair value on a recurring basis as of December 31, 2015 and December 31, 2014: Quoted Significant Total fair prices other Significant value at in active observable unobservable December 31, markets inputs inputs 2015 (Level 1) (Level 2) (Level 3) Interest rate caps $ 1,147 $ — $ 1,147 $ — Quoted Significant Total fair prices other Significant value at in active observable unobservable December 31, markets inputs inputs 2014 (Level 1) (Level 2) (Level 3) Interest rate caps $ 1,711 $ — $ 1,711 $ — |
Variable interest entities (Tab
Variable interest entities (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Organization Consolidation And Presentation Of Financial Statements [Abstract] | |
Carrying Value of Variable Interest Entities of Consolidated Financial Statements | The carrying values of VIEs included in the consolidated financial statements as of December 31, 2015 and December 31, 2014 are as follows: December 31, 2015 December 31, 2014 Assets Liabilities Assets Liabilities PF Melville $ 3,728 $ — $ 3,479 $ — MMR $ 2,953 — 2,750 — Total $ 6,681 $ — $ 6,229 $ — |
Acquisition (Tables)
Acquisition (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Business Combinations [Abstract] | |
Schedule of Allocated Purchase Consideration | The purchase consideration was allocated as follows: Amount Fixed assets $ 7,634 Reacquired franchise rights 8,950 Membership relationships 5,882 Favorable leases, net 700 Other assets 35 Goodwill 19,771 Liabilities assumed, including deferred revenues (1,334 ) $ 41,638 |
Property and equipment (Tables)
Property and equipment (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Property Plant And Equipment [Abstract] | |
Schedule of Property and Equipment | Property and equipment as of December 31, 2015 and 2014 consists of the following: December 31, 2015 December 31, 2014 Land $ 910 $ 910 Equipment 27,391 22,137 Leasehold improvements 38,288 27,361 Buildings and improvements 5,107 5,119 Furniture & fixtures 3,030 2,309 Other 2,947 2,096 Construction in progress 1,991 5,375 79,664 65,307 Accumulated Depreciation (23,525 ) (15,728 ) Total $ 56,139 $ 49,579 |
Goodwill and intangible assets
Goodwill and intangible assets (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Goodwill And Intangible Assets Disclosure [Abstract] | |
Summary of Goodwill and Intangible Assets | A summary of goodwill and intangible assets at December 31, 2015 and 2014 is as follows: Weighted average Gross amortization carrying Accumulated Net carrying December 31, 2015 period (years) amount amortization Amount Customer relationships 11.1 $ 171,782 (57,741 ) $ 114,041 Noncompete agreements 5.0 14,500 (9,127 ) 5,373 Favorable leases 7.5 2,935 (1,256 ) 1,679 Order backlog 0.4 3,400 (3,400 ) — Reacquired franchise rights 5.8 8,950 (2,724 ) 6,226 201,567 (74,248 ) 127,319 Indefinite-lived intangible: Trade and brand names N/A 146,300 — 146,300 Total intangible assets $ 347,867 $ (74,248 ) $ 273,619 Goodwill $ 176,981 $ — $ 176,981 Weighted average Gross amortization carrying Accumulated Net carrying December 31, 2014 period (years) amount amortization Amount Customer relationships 11.1 $ 171,782 $ (41,130 ) $ 130,652 Noncompete agreements 5.0 14,500 (6,229 ) 8,271 Favorable leases 7.5 2,935 (779 ) 2,156 Order backlog 0.4 3,400 (3,400 ) — Reacquired franchise rights 5.8 8,950 (1,167 ) 7,783 201,567 (52,705 ) 148,862 Indefinite-lived intangible: Trade and brand names N/A 146,300 — 146,300 Total intangible assets $ 347,867 $ (52,705 ) $ 295,162 Goodwill $ 176,981 $ — $ 176,981 |
Summary of Changes in Carrying Amount of Goodwill | The changes in the carrying amount of goodwill are as follows: Franchise Corporate-owned stores Equipment Total As of December 31, 2013 $ 16,938 $ 47,606 $ 92,666 $ 157,210 Acquisition of franchises — 19,771 — 19,771 As of December 31, 2014 16,938 67,377 92,666 176,981 Additions — — — — As of December 31, 2015 $ 16,938 $ 67,377 $ 92,666 $ 176,981 |
Summary of Amortization expenses | The anticipated annual amortization expense to be recognized in future years as of December 31, 2015 is as follows: Amount 2016 $ 19,756 2017 18,215 2018 14,583 2019 14,215 2020 12,517 Thereafter 48,033 Total $ 127,319 |
Long-term debt (Tables)
Long-term debt (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Debt Disclosure [Abstract] | |
Schedule of Long-term Debt | Long-term debt as of December 31, 2015 and 2014 consists of the following: December 31, 2015 December 31, 2014 Term loan B requires quarterly installments plus interest through the term of the loan, maturing March 31, 2021. Outstanding borrowings bear interest at LIBOR or base rate (as defined) plus a margin at the election of the borrower (4.75% at December 31, 2015 and 2014) $ 492,275 $ 387,075 Revolving credit line, requires interest only payments through the term of the loan, maturing March 31, 2019. Outstanding borrowings bear interest at LIBOR or base rate (as defined) plus a margin at the election of the borrower (4.25% at December 31, 2015 and 2014) — — Total debt, excluding deferred financing costs 492,275 387,075 Deferred financing costs, net of accumulated amortization (7,396 ) (7,294 ) Total debt 484,879 379,781 Current portion of long-term debt and line of credit 5,100 3,900 Long-term debt, net of current portion $ 479,779 $ 375,881 |
Schedule of Future Annual Payments of Long-term Debt | Future annual principal payments of long-term debt as of December 31, 2015 are as follows: Amount 2016 $ 5,100 2017 5,100 2018 5,100 2019 5,100 2020 5,100 Thereafter 466,775 Total $ 492,275 |
Deferred revenue (Tables)
Deferred revenue (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Deferred Revenue Disclosure [Abstract] | |
Schedule of Deferred Revenue | The summary set forth below represents the balances in deferred revenue as of December 31, 2015 and 2014: December 31, 2015 December 31, 2014 Prepaid membership fees $ 5,134 $ 5,382 Enrollment fees 1,555 1,692 Equipment discount 2,968 2,689 Annual membership fees 6,132 5,696 Area development and franchise fees 10,944 8,420 Total deferred revenue 26,733 23,879 Long-term portion of deferred revenue 12,016 9,330 Current portion of deferred revenue $ 14,717 $ 14,549 |
Related party transactions (Tab
Related party transactions (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Related Party Transactions [Abstract] | |
Summary of Amounts Due From Stockholders/Members | Amounts due from stockholders/members as of December 31, 2015 and 2014 relate to reimbursements for certain taxes owed or paid by the Company. December 31, 2015 December 31, 2014 Accounts receivable – related entities $ 39 $ 11 Accounts receivable – stockholders/members 4,901 1,130 4,940 1,141 Due from related parties, current portion 4,940 1,141 Due from related parties, net of current portion $ — $ — |
Schedule of Related Party Transactions | Activity with entities considered to be related parties is summarized below. For the Year Ended December 31, 2015 2014 2013 Franchise revenue $ 1,232 $ 733 $ 1,620 Equipment revenue 1,686 3,711 855 Total revenue from related parties $ 2,918 $ 4,444 $ 2,475 |
Equity-based Compensation (Tabl
Equity-based Compensation (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Share Based Compensation [Abstract] | |
Summary of Class M Unit Activity | A summary of Class M Unit activity is presented below: Class M Units Holdings Units Weighted average grant date fair value Outstanding at January 1, 2013 — $ — Units granted 431.577 — Outstanding at December 31, 2013 431.577 — Units granted 121.051 — Units forfeited (47.368 ) — Outstanding at December 31, 2014 505.260 — Units granted — — Units forfeited (21.053 ) — Units converted upon IPO (484.207 ) 4,238,338 1.52 Outstanding at December 31, 2015 — 4,238,338 1.52 Vested or expected to vest at December 31, 2015 — 4,238,338 1.52 |
Fair Value of Stock Option Awards Determined on Grant Date Using Black-Scholes Valuation Model | The fair value of stock option awards granted during the year ended December 31, 2015 was determined on the grant date using the Black-Scholes valuation model based on the following weighted-average assumptions: Expected term (years) (1) 6.25 Expected volatility (2) 35.4 % Risk-free interest rate (3) 1.82 % Dividend yield (4) — (1) Expected term represents the estimated period of time until an award is exercised and was determined using the simplified method. (2) Expected volatility is based on the historical volatility of a selected peer group over a period equivalent to the expected term. (3) The risk-free rate is an interpolation of yields on U.S. Treasury securities with maturities equivalent to the expected term. (4) We have assumed a dividend yield of zero as we have no plans to declare dividends in the foreseeable future. |
Summary of Stock Option Activity | A summary of stock option activity for the year ended December 31, 2015: Stock Options Weighted exercise price Weighted average remaining contractual term (years) Outstanding at beginning of period — $ — Granted 116,690 16.14 Exercised — — Forfeited (8,420 ) 16.00 Outstanding at December 31, 2015 108,270 $ 16.15 9.6 Vested or expected to vest at December 31, 2015 104,769 $ 16.15 9.6 |
Earnings per share (Tables)
Earnings per share (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Class A Common Stock [Member] | |
Earnings Per Share Basic [Line Items] | |
Reconciliation of Numerators and Denominators Used to Compute Basic and Diluted Earnings per Share | The following table sets forth reconciliations of the numerators and denominators used to compute basic and diluted earnings per share of Class A common stock: Basic net income per share: August 6, 2015 through December 31, 2015 Numerator Net income $ 23,454 Less: net income attributable to non-controlling interests 19,348 Net income attributable to Planet Fitness, Inc. $ 4,106 Denominator Weighted-average shares of Class A common stock outstanding - basic 36,243,557 Earnings per share of Class A common stock - basic $ 0.11 |
Income taxes (Tables)
Income taxes (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Income Tax Disclosure [Abstract] | |
Schedule of Income Before Provision for Income Taxes | Income before the provision for income taxes as shown in the accompanying consolidated statements of operations is as follows: Year Ended December 31, 2015 2014 2013 Domestic $ 48,716 $ 39,534 $ 26,432 Foreign (1,438 ) (1,056 ) — Total current tax expense 47,278 38,478 26,432 |
Schedule of Provision (Benefit) for Income Taxes | The provision (benefit) for income taxes consists of the following: Year Ended December 31, 2015 2014 2013 Current: Federal $ 686 $ — $ — State 2,188 1,078 2,063 Foreign 139 168 — Total current tax expense 3,013 1,246 2,063 Deferred: Federal 5,636 — — State 935 217 (1,430 ) Foreign (436 ) (280 ) — Total deferred tax (benefit) expense 6,135 (63 ) (1,430 ) Provision for income taxes $ 9,148 $ 1,183 $ 633 |
Schedule of Reconciliation of U.S. Statutory Income Tax Rate to Company's Effective Tax Rate | A reconciliation of the U.S. statutory income tax rate to the Company’s effective tax rate is as follows: Year Ended December 31, 2015 U.S. statutory tax rate 35.0 % State and local taxes, net of federal benefit 6.2 % Rate change on deferred tax asset from recapitalization 6.9 % Tax benefit arrangement liability adjustment (2.1 )% Foreign tax rate differential 0.3 % Withholding taxes and other 0.2 % Income attributable to non-controlling interests (27.1 )% Effective tax rate 19.4 % |
Schedule of Deferred Tax Assets and Liabilities | Details of the Company’s deferred tax assets and liabilities are summarized as follows: Year Ended December 31, 2015 2014 Deferred tax assets: Accrued expense and reserves $ 353 $ 75 Deferred revenue 1,276 182 Goodwill and intangible assets 113,460 - Net operating loss 716 280 Other 2,841 85 Deferred tax assets $ 118,646 $ 622 Deferred tax liabilities: Prepaid expenses (674 ) (94 ) Goodwill and intangible assets - (717 ) Property and equipment (614 ) (154 ) Total deferred tax liabilities $ (1,288 ) $ (965 ) Total deferred tax assets and liabilities $ 117,358 $ (343 ) |
Schedule of Future Payments Under Tax Benefit Arrangements | Projected future payments under the tax benefit arrangements are as follows: Amount 2016 $ 3,019 2017 7,125 2018 7,072 2019 7,125 2020 7,321 Thereafter 108,529 Total $ 140,191 |
Commitments and contingencies (
Commitments and contingencies (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Commitments And Contingencies Disclosure [Abstract] | |
Schedule of Future Commitments Under Noncancelable Operating Leases | Approximate annual future commitments under noncancelable operating leases as of December 31, 2015 are as follows Amount 2016 $ 13,272 2017 12,700 2018 11,738 2019 10,325 2020 9,245 Thereafter 44,802 Total $ 102,082 |
Segments (Tables)
Segments (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Segment Reporting [Abstract] | |
Summary of Financial Information for the Company's Reportable Segments | The tables below summarize the financial information for the Company’s reportable segments for the years ended December 31, 2015, 2014 and 2013. The “Corporate and other” column, as it relates to Segment EBITDA, primarily includes corporate overhead costs, such as payroll and related benefit costs and professional services which are not directly attributable to any individual segment. Year Ended December 31, 2015 2014 2013 Revenue Franchise segment revenue – U.S. $ 87,299 $ 71,806 $ 44,157 Franchise segment revenue – International 786 — — Franchise segment total 88,085 71,806 44,157 Corporate-owned stores segment – U.S. 95,459 85,022 67,364 Corporate-owned stores segment – International 2,931 19 — Corporate-owned stores segment total 98,390 85,041 67,364 Equipment segment – U.S. 144,062 122,930 99,488 Equipment segment total 144,062 122,930 99,488 Total revenue $ 330,537 $ 279,777 $ 211,009 Year Ended December 31, 2015 2014 2013 Segment EBITDA Franchise $ 66,030 $ 53,109 $ 30,123 Corporate-owned stores 36,070 31,705 21,742 Equipment 31,936 26,447 19,791 Corporate and other (30,051 ) (18,642 ) (7,504 ) Total Segment EBITDA $ 103,985 $ 92,619 $ 64,152 |
Reconciliation of Total Segment EBITDA to Income Before Taxes | The following table reconciles total Segment EBITDA to income before taxes: Year Ended December 31, 2015 2014 2013 Total Segment EBITDA $ 103,985 $ 92,619 $ 64,152 Less: Depreciation and amortization 32,158 32,341 28,808 Other expense (275 ) (1,261 ) (694 ) Income from operations 72,102 61,539 36,038 Interest expense, net (24,549 ) (21,800 ) (8,912 ) Other expense (275 ) (1,261 ) (694 ) Income before income taxes $ 47,278 $ 38,478 $ 26,432 |
Summary of Company's Assets by Reportable Segment | The following table summarizes the Company’s assets by reportable segment: December 31, 2015 December 31, 2014 Franchise $ 206,997 $ 216,985 Corporate-owned stores 151,620 157,868 Equipment 208,168 220,367 Unallocated 132,392 6,762 Total consolidated assets $ 699,177 $ 601,982 |
Summary of Company's Goodwill by Reportable Segment | The following table summarizes the Company’s goodwill by reportable segment: December 31, 2015 December 31, 2014 Franchise $ 16,938 $ 16,938 Corporate-owned stores 67,377 67,377 Equipment 92,666 92,666 Total consolidated goodwill $ 176,981 $ 176,981 |
Corporate-owned and franchise43
Corporate-owned and franchisee-owned stores (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Other Industries [Abstract] | |
Schedule of Changes in Corporate-owned and Franchisee-owned Stores | The following table shows changes in our corporate-owned and franchisee-owned stores for the years ended December 31, 2015, 2014 and 2013: Year Ended December 31, 2015 2014 2013 Franchisee-owned stores: Stores operated at beginning of period 863 704 562 New stores opened 206 169 148 Stores debranded, sold or consolidated (1) (3 ) (10 ) (6 ) Stores operated at end of period 1,066 863 704 Corporate-owned stores: Stores operated at beginning of period 55 45 44 New stores opened 3 2 1 Stores acquired from franchisees — 8 - Stores operated at end of period 58 55 45 Total stores: Stores operated at beginning of period 918 749 606 New stores opened 209 171 149 Stores debranded, sold or consolidated (1) (3 ) (2 ) (6 ) Stores operated at end of period 1,124 918 749 (1) The term “debrand” refers to a franchisee-owned store whose right to use the Planet Fitness brand and marks has been terminated due to non-compliance with brand standards in accordance with the franchise agreement. We retain the right to prevent debranded stores from continuing to operate as fitness centers. The term “consolidated” refers to the combination of a franchisee’s store with another store located in close proximity with our prior approval. This often coincides with an enlargement, re-equipment and/or refurbishment of the remaining store. |
Quarterly financial data (una44
Quarterly financial data (unaudited) (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Quarterly Financial Information Disclosure [Abstract] | |
Schedule of Quarterly Financial Data | For the quarter ended March 31, 2015 June 30, 2015 September 30, 2015 December 31, 2015 Total revenue $ 76,923 $ 78,952 $ 68,817 $ 105,845 Income from operations 14,304 18,667 10,338 28,793 Net income 8,541 11,612 737 17,240 Earnings per share (1) August 6 through September 30, 2015 For the quarter ended December 31, 2015 Class A - Basic $ 0.05 $ 0.06 Class A - Diluted $ 0.04 $ 0.06 For the quarter ended March 31, 2014 June 30, 2014 September 30, 2014 December 31, 2014 Total revenue $ 57,594 $ 62,697 $ 63,467 $ 96,019 Income from operations 13,539 14,706 13,956 19,338 Net income 6,259 8,950 8,303 13,783 (1) Represents earnings per share of Class A common stock and weighted-average shares of Class A common stock outstanding for the periods from August 6, 2015 through September 30, 2015 and the quarter ended December 31, 2015, the periods following the recapitalization transactions and IPO (see Note 15). |
Business Organization - Additio
Business Organization - Additional Information (Detail) $ / shares in Units, $ in Thousands, Member in Millions | Aug. 11, 2015USD ($)$ / sharesshares | Aug. 05, 2015shares | Jun. 22, 2015shares | Dec. 31, 2015USD ($)MemberStoreStateshares | Dec. 31, 2014Store | Dec. 31, 2013Store | Dec. 31, 2012Store |
Organization Consolidation And Presentation Of Financial Statements Disclosure [Line Items] | |||||||
Number of members | Member | 7.3 | ||||||
Number of owned and franchised locations | Store | 1,124 | 918 | 749 | 606 | |||
Number of states in which entity operates | State | 47 | ||||||
Date of formation | Mar. 16, 2015 | ||||||
Proceeds from issuance of Class A common stock sold in initial public offering, net of underwriting discounts and commissions | $ | $ 156,946 | ||||||
Class A Common Stock [Member] | |||||||
Organization Consolidation And Presentation Of Financial Statements Disclosure [Line Items] | |||||||
Number of stock issued during period | 10,491,000 | ||||||
Class A Common Stock [Member] | Direct TSG Investors [Member] | |||||||
Organization Consolidation And Presentation Of Financial Statements Disclosure [Line Items] | |||||||
Number of stock issued during period | 5,033,945 | ||||||
Number of shares converted | 26,106,930 | ||||||
Class A Common Stock [Member] | IPO [Member] | Direct TSG Investors [Member] | |||||||
Organization Consolidation And Presentation Of Financial Statements Disclosure [Line Items] | |||||||
Number of stock issued during period | 21,072,985 | ||||||
Class B Common Stock [Member] | |||||||
Organization Consolidation And Presentation Of Financial Statements Disclosure [Line Items] | |||||||
Number of stock issued during period | (10,491,000) | ||||||
Class B Common Stock [Member] | Continuing LLC Owners [Member] | |||||||
Organization Consolidation And Presentation Of Financial Statements Disclosure [Line Items] | |||||||
Number of stock issued during period | 72,602,810 | ||||||
Pla-Fit Holdings, LLC [Member] | |||||||
Organization Consolidation And Presentation Of Financial Statements Disclosure [Line Items] | |||||||
Percentage of ownership | 100.00% | 100.00% | |||||
Percentage of economic interest | 37.10% | 37.10% | |||||
Pla-Fit Holdings, LLC [Member] | Class A Common Stock [Member] | IPO [Member] | |||||||
Organization Consolidation And Presentation Of Financial Statements Disclosure [Line Items] | |||||||
Number of stock issued during period | 15,525,000 | ||||||
Initial public offering price per share | $ / shares | $ 16 | ||||||
Pla-Fit Holdings, LLC [Member] | Class A Common Stock [Member] | IPO [Member] | Continuing LLC Owners [Member] | |||||||
Organization Consolidation And Presentation Of Financial Statements Disclosure [Line Items] | |||||||
Number of stock issued during period | 10,491,055 | ||||||
Proceeds from issuance of Class A common stock sold in initial public offering, net of underwriting discounts and commissions | $ | $ 156,946 | ||||||
Pla-Fit Holdings, LLC [Member] | Class B Common Stock [Member] | Continuing LLC Owners [Member] | |||||||
Organization Consolidation And Presentation Of Financial Statements Disclosure [Line Items] | |||||||
Number of stock issued during period | 72,602,810 | ||||||
Planet Intermediate, LLC [Member] | |||||||
Organization Consolidation And Presentation Of Financial Statements Disclosure [Line Items] | |||||||
Percentage of ownership | 100.00% | ||||||
Planet Fitness Holdings, LLC [Member] | |||||||
Organization Consolidation And Presentation Of Financial Statements Disclosure [Line Items] | |||||||
Percentage of ownership | 100.00% |
Summary of Significant Accoun46
Summary of Significant Accounting Policies - Additional Information (Detail) | 12 Months Ended | ||
Dec. 31, 2015USD ($)VendorAgreement | Dec. 31, 2014USD ($)Vendor | Dec. 31, 2013USD ($)Vendor | |
Significant Accounting Policies [Line Items] | |||
Number of vendors | Vendor | 2 | 2 | 2 |
Advertising purchases from vendor | 49.00% | 61.00% | 68.00% |
Deferred revenue | $ 26,733,000 | $ 23,879,000 | |
Membership enrollment fees recognition period | 2 years | ||
Membership fees recognition period | 12 months | ||
Equipment deposits | $ 5,587,000 | 6,675,000 | |
Cost of revenue | 113,492,000 | 100,306,000 | $ 81,353,000 |
Selling, general and administrative | 55,573,000 | 35,121,000 | 23,118,000 |
Advertising expenses | 9,349,000 | 7,272,000 | 5,731,000 |
Impairment charges | $ 0 | ||
Income tax positions | Recognized income tax positions are measured at the largest amount that is greater than 50% likely of being realized. | ||
Net cash paid for income taxes | $ 2,834,000 | 1,604,000 | 1,826,000 |
Number of tax receivable agreements | Agreement | 2 | ||
Applicable tax savings | 85.00% | ||
Percentage of remaining tax savings | 15.00% | ||
Income tax rate maximum tax liability | 3.50% | ||
Restatement Adjustment | Adjustments For New Accounting Principle Early Adoption | |||
Significant Accounting Policies [Line Items] | |||
Reclassification of deferred financing cost from other assets to long-term debt | 7,294,000 | ||
Direct TSG Investors and the Continuing LLC Owners [Member] | |||
Significant Accounting Policies [Line Items] | |||
Liability payable under tax benefit obligations | $ 142,000,000 | ||
Prior to November 7, 2012 | |||
Significant Accounting Policies [Line Items] | |||
Net cash paid for income taxes | 4,392,000 | ||
Point of Sale System [Member] | |||
Significant Accounting Policies [Line Items] | |||
Cost of revenue | 1,236,000 | 3,385,000 | 1,107,000 |
Placement Services [Member] | |||
Significant Accounting Policies [Line Items] | |||
Selling, general and administrative | 3,452,000 | 2,743,000 | $ 2,245,000 |
Area Development Agreements [Member] | |||
Significant Accounting Policies [Line Items] | |||
Deferred revenue | 10,471,000 | 8,215,000 | |
Area Development and Franchise Fees [Member] | |||
Significant Accounting Policies [Line Items] | |||
Deferred revenue | 10,944,000 | 8,420,000 | |
Franchise Fees [Member] | |||
Significant Accounting Policies [Line Items] | |||
Deferred revenue | $ 473,000 | $ 205,000 | |
Individual Franchise Agreements [Member] | |||
Significant Accounting Policies [Line Items] | |||
Franchisee initial term | 10 years | ||
Primary vendor for advertising services | |||
Significant Accounting Policies [Line Items] | |||
Number of vendors | Vendor | 1 | 1 | 1 |
Supplier Concentration Risk [Member] | Cost of Goods, Product Line [Member] | Vendor One [Member] | |||
Significant Accounting Policies [Line Items] | |||
Purchases from vendor | 79.00% | 66.00% | 66.00% |
Supplier Concentration Risk [Member] | Cost of Goods, Product Line [Member] | Vendor Two [Member] | |||
Significant Accounting Policies [Line Items] | |||
Purchases from vendor | 18.00% | 25.00% | 27.00% |
Supplier Concentration Risk [Member] | Cost of Goods, Product Line [Member] | Primary vendor for advertising services | |||
Significant Accounting Policies [Line Items] | |||
Purchases from vendor | 49.00% | 61.00% | 68.00% |
Maximum [Member] | |||
Significant Accounting Policies [Line Items] | |||
Insured amount | $ 250,000,000 | ||
Maximum [Member] | Area Development and Franchise Fees [Member] | |||
Significant Accounting Policies [Line Items] | |||
Franchisee initial term | 10 years | ||
Minimum [Member] | Area Development and Franchise Fees [Member] | |||
Significant Accounting Policies [Line Items] | |||
Franchisee initial term | 5 years |
Summary of Significant Accoun47
Summary of Significant Accounting Policies - Summary of Estimated Useful Lives of Company's Fixed assets (Detail) | 12 Months Ended |
Dec. 31, 2015 | |
Building and Building Improvements [Member] | Minimum [Member] | |
Significant Accounting Policies [Line Items] | |
Property, plant and equipment, estimated useful lives | 20 years |
Building and Building Improvements [Member] | Maximum [Member] | |
Significant Accounting Policies [Line Items] | |
Property, plant and equipment, estimated useful lives | 40 years |
Computer and Equipment [Member] | |
Significant Accounting Policies [Line Items] | |
Property, plant and equipment, estimated useful lives | 3 years |
Furniture and Fixtures [Member] | |
Significant Accounting Policies [Line Items] | |
Property, plant and equipment, estimated useful lives | 5 years |
Leasehold Improvements [Member] | |
Significant Accounting Policies [Line Items] | |
Property, plant and equipment, estimated useful lives | Useful life or term of lease whichever is shorter |
Fitness Equipment [Member] | Minimum [Member] | |
Significant Accounting Policies [Line Items] | |
Property, plant and equipment, estimated useful lives | 5 years |
Fitness Equipment [Member] | Maximum [Member] | |
Significant Accounting Policies [Line Items] | |
Property, plant and equipment, estimated useful lives | 7 years |
Vehicles [Member] | |
Significant Accounting Policies [Line Items] | |
Property, plant and equipment, estimated useful lives | 5 years |
Summary of Significant Accoun48
Summary of Significant Accounting Policies - Summary of Company's Assets and Liabilities Measured at Fair Value on Recurring Basis (Detail) - Interest Rate Cap [Member] - Fair Value Measurements Recurring - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 |
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items] | ||
Interest rate caps | $ 1,147 | $ 1,711 |
Significant Other Observable Inputs (Level 2) [Member] | ||
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items] | ||
Interest rate caps | $ 1,147 | $ 1,711 |
Variable Interest Entities - Ca
Variable Interest Entities - Carrying Value of Variable Interest Entities of Consolidated Financial Statements (Detail) - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 |
Variable Interest Entity [Line Items] | ||
Assets | $ 6,681 | $ 6,229 |
PF Melville [Member] | ||
Variable Interest Entity [Line Items] | ||
Assets | 3,728 | 3,479 |
MMR [Member] | ||
Variable Interest Entity [Line Items] | ||
Assets | $ 2,953 | $ 2,750 |
Variable Interest Entities - Ad
Variable Interest Entities - Additional Information (Detail) - USD ($) | Dec. 31, 2015 | Dec. 31, 2014 |
Variable Interest Entity Consolidated Carrying Amount Assets And Liabilities [Abstract] | ||
Maximum obligation of guarantees of leases and debt | $ 1,871,000 | $ 2,896,000 |
Maximum loss exposure Involvement of estimated value | $ 0 |
Acquisition - Additional Inform
Acquisition - Additional Information (Detail) $ in Thousands | Mar. 31, 2014USD ($)Store | Dec. 31, 2015USD ($)Store | Dec. 31, 2014USD ($)Store | Dec. 31, 2013Store | Dec. 31, 2012Store |
Business Acquisition [Line Items] | |||||
Number of franchise owned stores | Store | 1,124 | 918 | 749 | 606 | |
Purchase price consideration before loss incurred | $ 42,931 | ||||
Business combination, cash payment | 39,931 | ||||
Deferred revenue | $ 26,733 | $ 23,879 | |||
Business combination, purchase price | $ 41,638 | ||||
New York [Member] | |||||
Business Acquisition [Line Items] | |||||
Number of franchise owned stores | Store | 8 | ||||
Equipment Discount [Member] | |||||
Business Acquisition [Line Items] | |||||
Deferred revenue | $ 3,000 | $ 2,968 | $ 2,689 | ||
Reacquired Franchise Rights [Member] | |||||
Business Acquisition [Line Items] | |||||
Loss on unfavorable reacquisition of franchise rights | $ 1,293 |
Acquisition - Schedule of Alloc
Acquisition - Schedule of Allocated Purchase Consideration (Detail) - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 | Mar. 31, 2014 | Dec. 31, 2013 |
Business Acquisition [Line Items] | ||||
Goodwill | $ 176,981 | $ 176,981 | $ 157,210 | |
Franchisee Acquisition [Member] | ||||
Business Acquisition [Line Items] | ||||
Fixed assets | $ 7,634 | |||
Favorable leases, net | 700 | |||
Other assets | 35 | |||
Goodwill | 19,771 | |||
Liabilities assumed, including deferred revenues | (1,334) | |||
Total | 41,638 | |||
Franchisee Acquisition [Member] | Reacquired Franchise Rights [Member] | ||||
Business Acquisition [Line Items] | ||||
Intangible assets | 8,950 | |||
Franchisee Acquisition [Member] | Membership Relationships [Member] | ||||
Business Acquisition [Line Items] | ||||
Intangible assets | $ 5,882 |
National Advertising Fund - Add
National Advertising Fund - Additional Information (Detail) - Planet Fitness NAF, LLC [Member] - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Related Party Transaction [Line Items] | |||
Percentage of franchise membership billing revenue | 2.00% | ||
Initial administrative fees charged | $ 1,340 | $ 1,010 | $ 865 |
Notes Receivable - Additional I
Notes Receivable - Additional Information (Detail) | 12 Months Ended | |
Dec. 31, 2015USD ($) | Dec. 31, 2014Receivable | |
Receivables [Abstract] | ||
Number of notes receivable | Receivable | 2 | |
Notes receivable maturity date, Start | Jul. 1, 2015 | |
Notes receivable maturity date, End | Feb. 1, 2018 | |
Notes Receivable, Net | $ | $ 0 |
Property and Equipment - Schedu
Property and Equipment - Schedule of Property and Equipments (Detail) - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 |
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | $ 79,664 | $ 65,307 |
Accumulated Depreciation | (23,525) | (15,728) |
Total | 56,139 | 49,579 |
Land [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 910 | 910 |
Equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 27,391 | 22,137 |
Leasehold Improvements [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 38,288 | 27,361 |
Buildings and Improvements [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 5,107 | 5,119 |
Furniture and Fixtures [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 3,030 | 2,309 |
Other [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 2,947 | 2,096 |
Construction in Progress [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | $ 1,991 | $ 5,375 |
Property and Equipment - Additi
Property and Equipment - Additional Information (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Property Plant And Equipment [Abstract] | |||
Depreciation expense | $ 11,088 | $ 9,138 | $ 6,171 |
Goodwill and Intangible Asset57
Goodwill and Intangible Assets - Summary of Goodwill and Intangible Assets (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Goodwill And Intangible Assets [Line Items] | |||
Total intangible assets, Gross carrying amount | $ 347,867 | $ 347,867 | |
Gross carrying amount | 201,567 | 201,567 | |
Accumulated amortization | (74,248) | (52,705) | |
Net carrying Amount | 127,319 | 148,862 | |
Total intangible assets, Net carrying Amount | 273,619 | 295,162 | |
Goodwill, Gross carrying amount | 176,981 | 176,981 | |
Goodwill, Net carrying Amount | 176,981 | 176,981 | $ 157,210 |
Trade and Brand Names [Member] | |||
Goodwill And Intangible Assets [Line Items] | |||
Indefinite-lived intangible, Net carrying Amount | $ 146,300 | $ 146,300 | |
Customer Relationships [Member] | |||
Goodwill And Intangible Assets [Line Items] | |||
Weighted average amortization period (years) | 11 years 1 month 6 days | 11 years 1 month 6 days | |
Gross carrying amount | $ 171,782 | $ 171,782 | |
Accumulated amortization | (57,741) | (41,130) | |
Net carrying Amount | $ 114,041 | $ 130,652 | |
Noncompete Agreements [Member] | |||
Goodwill And Intangible Assets [Line Items] | |||
Weighted average amortization period (years) | 5 years | 5 years | |
Gross carrying amount | $ 14,500 | $ 14,500 | |
Accumulated amortization | (9,127) | (6,229) | |
Net carrying Amount | $ 5,373 | $ 8,271 | |
Favorable Leases [Member] | |||
Goodwill And Intangible Assets [Line Items] | |||
Weighted average amortization period (years) | 7 years 6 months | 7 years 6 months | |
Gross carrying amount | $ 2,935 | $ 2,935 | |
Accumulated amortization | (1,256) | (779) | |
Net carrying Amount | $ 1,679 | $ 2,156 | |
Order Backlog [Member] | |||
Goodwill And Intangible Assets [Line Items] | |||
Weighted average amortization period (years) | 4 months 24 days | 4 months 24 days | |
Gross carrying amount | $ 3,400 | $ 3,400 | |
Accumulated amortization | $ (3,400) | $ (3,400) | |
Reacquired Franchise Rights [Member] | |||
Goodwill And Intangible Assets [Line Items] | |||
Weighted average amortization period (years) | 5 years 9 months 18 days | 5 years 9 months 18 days | |
Gross carrying amount | $ 8,950 | $ 8,950 | |
Accumulated amortization | (2,724) | (1,167) | |
Net carrying Amount | $ 6,226 | $ 7,783 |
Goodwill and Intangible Asset58
Goodwill and Intangible Assets - Summary of Changes in Carrying Amount of Goodwill (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2014 | Dec. 31, 2015 | Dec. 31, 2013 | |
Goodwill [Line Items] | |||
Goodwill | $ 176,981 | $ 176,981 | $ 157,210 |
Acquisition of franchises | 19,771 | ||
Franchise [Member] | |||
Goodwill [Line Items] | |||
Goodwill | 16,938 | 16,938 | 16,938 |
Corporate-owned Stores [Member] | |||
Goodwill [Line Items] | |||
Goodwill | 67,377 | 67,377 | 47,606 |
Acquisition of franchises | 19,771 | ||
Equipment [Member] | |||
Goodwill [Line Items] | |||
Goodwill | $ 92,666 | $ 92,666 | $ 92,666 |
Goodwill and Intangible Asset59
Goodwill and Intangible Assets - Additional Information (Detail) - USD ($) | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Goodwill And Intangible Assets [Line Items] | |||
Impairment charges | $ 0 | $ 0 | |
Amortization of intangible assets | 21,543,000 | 23,698,000 | $ 22,883,000 |
Favorable And Unfavorable Leases [Member] | |||
Goodwill And Intangible Assets [Line Items] | |||
Amortization of intangible assets | $ 473,000 | $ 495,000 | $ 246,000 |
Goodwill and Intangible Asset60
Goodwill and Intangible Assets - Summary of Amortization expenses (Detail) - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 |
Goodwill And Intangible Assets Disclosure [Abstract] | ||
2,016 | $ 19,756 | |
2,017 | 18,215 | |
2,018 | 14,583 | |
2,019 | 14,215 | |
2,020 | 12,517 | |
Thereafter | 48,033 | |
Net carrying Amount | $ 127,319 | $ 148,862 |
Long-term Debt - Schedule of Lo
Long-term Debt - Schedule of Long-term Debt (Detail) - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 |
Debt Instrument [Line Items] | ||
Total debt, excluding deferred financing costs | $ 492,275 | $ 387,075 |
Deferred financing costs, net of accumulated amortization | (7,396) | (7,294) |
Total debt | 484,879 | 379,781 |
Current portion of long-term debt and line of credit | 5,100 | 3,900 |
Long-term debt, net of current portion | 479,779 | 375,881 |
Term Loan B [Member] | ||
Debt Instrument [Line Items] | ||
Total debt, excluding deferred financing costs | $ 492,275 | $ 387,075 |
Long-term Debt - Schedule of 62
Long-term Debt - Schedule of Long-term Debt (Parenthetical) (Detail) | 12 Months Ended | |
Dec. 31, 2015 | Dec. 31, 2014 | |
Revolving Credit Facility [Member] | ||
Debt Instrument [Line Items] | ||
Debt instrument maturity date | Mar. 31, 2019 | Mar. 31, 2019 |
Total rate - base plus spread | 4.25% | 4.25% |
Term Loan B [Member] | ||
Debt Instrument [Line Items] | ||
Debt instrument maturity date | Mar. 31, 2021 | Mar. 31, 2021 |
Total rate - base plus spread | 4.75% | 4.75% |
Long-term Debt - Additional Inf
Long-term Debt - Additional Information (Detail) - USD ($) | 3 Months Ended | 12 Months Ended | ||
Mar. 31, 2015 | Mar. 31, 2014 | Dec. 31, 2015 | Dec. 31, 2014 | |
Debt Instrument [Line Items] | ||||
Credit facility expiration period | 5 years | |||
Credit facility maximum borrowing capacity | $ 430,000,000 | |||
Funds used to pay dividend | $ 140,000,000 | 173,900,000 | ||
Term Loan B [Member] | ||||
Debt Instrument [Line Items] | ||||
Credit facility maximum borrowing capacity | $ 510,000,000 | 390,000,000 | ||
Credit facility quarterly principal installment payment | $ 1,275,000 | |||
Debt instrument maturity date | Mar. 31, 2021 | Mar. 31, 2021 | ||
Revolving Credit Facility [Member] | ||||
Debt Instrument [Line Items] | ||||
Credit facility maximum borrowing capacity | $ 40,000,000 | |||
Unused portion of credit facility | $ 40,000,000 | |||
Debt instrument maturity date | Mar. 31, 2019 | Mar. 31, 2019 |
Long-term Debt - Schedule of Fu
Long-term Debt - Schedule of Future Annual Payments of Long-term Debt (Detail) - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 |
Debt Disclosure [Abstract] | ||
2,016 | $ 5,100 | |
2,017 | 5,100 | |
2,018 | 5,100 | |
2,019 | 5,100 | |
2,020 | 5,100 | |
Thereafter | 466,775 | |
Total | $ 492,275 | $ 387,075 |
Derivative Instruments and He65
Derivative Instruments and Hedging Activities - Additional Information (Detail) | 1 Months Ended | 3 Months Ended | 12 Months Ended | ||
Sep. 30, 2015USD ($)Cap | Sep. 30, 2014USD ($) | Mar. 31, 2014USD ($) | Dec. 31, 2015USD ($) | Dec. 31, 2014USD ($) | |
Derivative Instruments And Hedging Activities Disclosures [Line Items] | |||||
Derivative, interest rate cap floor | 1.50% | ||||
Unrealized loss on interest rate caps, net of tax | $ (1,388,000) | $ (662,000) | |||
Interest Rate Swap Agreements [Member] | Interest Expense [Member] | |||||
Derivative Instruments And Hedging Activities Disclosures [Line Items] | |||||
Loss related to terminated swap agreements | 248,000 | ||||
Interest Rate Swap Agreements [Member] | Accumulated Net Gain (Loss) from Cash Flow Hedges Including Portion Attributable to Noncontrolling Interest [Member] | Reclassification out of Accumulated Other Comprehensive Income [Member] | |||||
Derivative Instruments And Hedging Activities Disclosures [Line Items] | |||||
Interest expense | $ 92,000 | ||||
Interest Rate Cap [Member] | |||||
Derivative Instruments And Hedging Activities Disclosures [Line Items] | |||||
Derivative, premium payments | $ 880,000 | $ 2,373,000 | |||
Derivative, notional amount | $ 194,000,000 | 238,000,000 | |||
Derivative, inception date | Sep. 30, 2015 | Sep. 30, 2014 | |||
Number of additional caps | Cap | 2 | ||||
Derivative, maturity date | Sep. 30, 2018 | Sep. 29, 2017 | |||
Interest rate caps | 1,147,000 | 1,711,000 | |||
Unrealized loss on interest rate caps, net of tax | (1,388,000) | $ (662,000) | |||
Unrealized loss on interest rate caps, tax | $ (28,000) |
Deferred Revenue - Schedule of
Deferred Revenue - Schedule of Deferred Revenue (Detail) - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 | Mar. 31, 2014 |
Deferred Revenue Arrangement [Line Items] | |||
Deferred revenue | $ 26,733 | $ 23,879 | |
Deferred revenue, long-term portion | 12,016 | 9,330 | |
Deferred revenue, current portion | 14,717 | 14,549 | |
Prepaid Membership Fees [Member] | |||
Deferred Revenue Arrangement [Line Items] | |||
Deferred revenue | 5,134 | 5,382 | |
Enrollment Fees [Member] | |||
Deferred Revenue Arrangement [Line Items] | |||
Deferred revenue | 1,555 | 1,692 | |
Equipment Discount [Member] | |||
Deferred Revenue Arrangement [Line Items] | |||
Deferred revenue | 2,968 | 2,689 | $ 3,000 |
Annual Membership Fees [Member] | |||
Deferred Revenue Arrangement [Line Items] | |||
Deferred revenue | 6,132 | 5,696 | |
Area Development and Franchise Fees [Member] | |||
Deferred Revenue Arrangement [Line Items] | |||
Deferred revenue | $ 10,944 | $ 8,420 |
Deferred Revenue - Additional I
Deferred Revenue - Additional Information (Detail) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2015 | Dec. 31, 2014 | |
Deferred Revenue Disclosure [Abstract] | ||
Equipment deposits | $ 5,587 | $ 6,675 |
Deferred revenue expected recognition period | 12 months |
Related Party Transactions - Su
Related Party Transactions - Summary of Amounts Due From Stockholders/Members (Detail) - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 |
Related Party Transactions [Abstract] | ||
Accounts receivable – related entities | $ 39 | $ 11 |
Accounts receivable – stockholders/members | 4,901 | 1,130 |
Due from related parties | 4,940 | 1,141 |
Due from related parties, current portion | $ 4,940 | $ 1,141 |
Related Party Transactions - Sc
Related Party Transactions - Schedule of Related Party Transactions (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Related Party Transaction [Line Items] | |||
Total revenue from related parties | $ 2,918 | $ 4,444 | $ 2,475 |
Franchise [Member] | |||
Related Party Transaction [Line Items] | |||
Total revenue from related parties | 1,232 | 733 | 1,620 |
Equipment [Member] | |||
Related Party Transaction [Line Items] | |||
Total revenue from related parties | $ 1,686 | $ 3,711 | $ 855 |
Related Party Transactions - Ad
Related Party Transactions - Additional Information (Detail) - Direct TSG Investors [Member] - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Related Party Transaction [Line Items] | |||
Payment for management fee | $ 1,899 | $ 1,211 | $ 1,136 |
Liability payable under tax benefit obligations | 140,191 | ||
Management Agreement Termination | |||
Related Party Transaction [Line Items] | |||
Management agreement termination fee | $ 1,000 |
Stockholder's Equity - Addition
Stockholder's Equity - Additional Information (Detail) - USD ($) $ in Thousands | Aug. 11, 2015 | Aug. 05, 2015 | Jun. 22, 2015 | Dec. 31, 2015 | Aug. 06, 2015 |
Class Of Stock [Line Items] | |||||
Convertible stock, conversion description | Following the Merger and the Reclassification, the Company and the Continuing LLC Owners entered into an exchange agreement under which the Continuing LLC Owners (or certain permitted transferees thereof) have the right, from time to time and subject to the terms of the exchange agreement, to exchange their Holdings Units, along with a corresponding number of shares of Class B common stock, for shares of Class A common stock (or cash at the option of the Company) on a one-for-one basis, subject to customary conversion rate adjustments for stock splits, stock dividends, reclassifications and similar transactions. | ||||
Continuing LLC Owners [Member] | IPO [Member] | |||||
Class Of Stock [Line Items] | |||||
Percentage of economic interest | 62.90% | ||||
Number of units held by owners | 62,111,755 | ||||
Class A Common Stock [Member] | |||||
Class Of Stock [Line Items] | |||||
Number of stock issued during period | 10,491,000 | ||||
Common stock, shares outstanding | 36,597,985 | 0 | |||
Class A Common Stock [Member] | Pla-Fit Holdings, LLC [Member] | |||||
Class Of Stock [Line Items] | |||||
Reimbursement of IPO expenses | $ 7,697 | ||||
Class A Common Stock [Member] | Pla-Fit Holdings, LLC [Member] | IPO [Member] | |||||
Class Of Stock [Line Items] | |||||
Number of stock issued during period | 15,525,000 | ||||
Class A Common Stock [Member] | Direct TSG Investors [Member] | |||||
Class Of Stock [Line Items] | |||||
Number of shares converted | 26,106,930 | ||||
Number of stock issued during period | 5,033,945 | ||||
Class A Common Stock [Member] | Direct TSG Investors [Member] | IPO [Member] | |||||
Class Of Stock [Line Items] | |||||
Number of stock issued during period | 21,072,985 | ||||
Percentage of voting power | 21.40% | ||||
Percentage of economic interest | 21.40% | ||||
Class A Common Stock [Member] | Continuing LLC Owners [Member] | Pla-Fit Holdings, LLC [Member] | IPO [Member] | |||||
Class Of Stock [Line Items] | |||||
Number of stock issued during period | 10,491,055 | ||||
Aggregate amount of units issued | $ 156,946 | ||||
Class A Common Stock [Member] | Investor | IPO [Member] | |||||
Class Of Stock [Line Items] | |||||
Number of stock issued during period | 15,525,000 | ||||
Percentage of voting power | 15.70% | ||||
Percentage of economic interest | 15.70% | ||||
Class B Common Stock [Member] | |||||
Class Of Stock [Line Items] | |||||
Number of stock issued during period | (10,491,000) | ||||
Common stock, shares outstanding | 62,112,000 | 0 | |||
Class B Common Stock [Member] | Continuing LLC Owners [Member] | |||||
Class Of Stock [Line Items] | |||||
Number of stock issued during period | 72,602,810 | ||||
Common stock dividend and voting rights description | The shares of Class B common stock have no rights to dividends or distributions, whether in cash or stock, but entitle the holder to one vote per share on matters presented to stockholders of the Company. | ||||
Class B Common Stock [Member] | Continuing LLC Owners [Member] | IPO [Member] | |||||
Class Of Stock [Line Items] | |||||
Percentage of voting power | 62.90% | ||||
Number of units held by owners | 62,111,755 | ||||
Class B Common Stock [Member] | Continuing LLC Owners [Member] | Pla-Fit Holdings, LLC [Member] | |||||
Class Of Stock [Line Items] | |||||
Number of stock issued during period | 72,602,810 | ||||
Merger Agreement [Member] | Class A Common Stock [Member] | Direct TSG Investors [Member] | |||||
Class Of Stock [Line Items] | |||||
Number of shares converted | 26,106,930 |
Equity-Based Compensation - Add
Equity-Based Compensation - Additional Information (Detail) - USD ($) | 1 Months Ended | 12 Months Ended | ||
Aug. 31, 2015 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Share based compensation, compensation expense | $ 4,731,000 | |||
Share based compensation, total unrecognized compensation | $ 729,000 | |||
Share based compensation, shares granted to purchase up to | 116,690 | |||
Weighted-average grant date fair value of stock options granted | $ 6.14 | |||
Selling, general and administrative | $ 55,573,000 | $ 35,121,000 | $ 23,118,000 | |
Stock options outstanding | 108,270 | |||
Stock options, exercisable, number | 0 | |||
Aggregate intrinsic value of stock options outstanding | $ 0 | |||
Unrecognized compensation expense related to unvested stock options, including an estimate for pre-vesting forfeitures | $ 514,000 | |||
Restricted Stock Units [Member] | ||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Stock options, expected recognition, weighted-average period | 2 years 8 months 12 days | |||
Selling, general and administrative | $ 26,000 | |||
Weighted-average grant date fair value of restricted stock granted | $ 18.38 | |||
RSUs outstanding | 8,160 | |||
RSUs, exercisable, number | 0 | |||
Unrecognized compensation expense related to unvested RSUs, including an estimate for pre-vesting forfeitures | $ 124,000 | |||
Stock Options [Member] | ||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Stock options, expected recognition, weighted-average period | 3 years 7 months 6 days | |||
Selling, general and administrative | $ 131,000 | |||
Class M Units [Member] | ||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Share based compensation, shares vested | 10.737 | |||
Share based compensation, weighted-average grant date fair value | $ 1.52 | |||
Stock options, expected recognition, weighted-average period | 2 years 4 months 24 days | |||
Share based compensation, shares granted | 121.051 | 431.577 | ||
Share based compensation, shares forfeited | 21.053 | 47.368 | ||
RSUs outstanding | 505.260 | 431.577 | ||
Class B Common Stock [Member] | ||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Share based compensation, shares issued | 4,238,338 | |||
Share based compensation, weighted-average grant date fair value | $ 1.52 | |||
Class A Common Stock [Member] | Restricted Stock Units [Member] | ||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Share based compensation, shares granted | 8,160 | |||
2013 Equity Incentive Plan [Member] | Class M Units [Member] | ||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Share based compensation, vest equally over a period | 5 years | |||
Contractual term in years of stock option awards | 10 years | |||
Weighted average grant-date fair value | $ 10,047,000 | $ 10,656,000 | ||
Weighted average grant-date fair value of units vested | $ 69.052 | $ 24.421 | ||
Share based compensation, shares granted | 0 | 0 | ||
Share based compensation, shares forfeited | 0 | |||
2013 Equity Incentive Plan [Member] | Class M Units [Member] | Tranche One [Member] | ||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Award vesting rights, percentage | 80.00% | |||
2013 Equity Incentive Plan [Member] | Class M Units [Member] | IPO [Member] | Tranche One [Member] | ||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Award vesting rights, percentage | 20.00% | |||
2015 Omnibus Incentive Plan [Member] | Maximum [Member] | ||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Share based compensation, options granted to purchase up to | 7,896,800 | |||
2015 Omnibus Incentive Plan [Member] | IPO [Member] | ||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Share based compensation, vest equally over a period | 4 years | |||
Share based compensation, exercise price | $ 16 | |||
Share based compensation, options to purchase additional shares | 10,660 | |||
Share based compensation, exercise price | $ 17.50 | |||
2015 Omnibus Incentive Plan [Member] | IPO [Member] | Maximum [Member] | ||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Share based compensation, shares granted to purchase up to | 106,030 |
Equity-Based Compensation - Fai
Equity-Based Compensation - Fair Value of Stock Option Awards Determined on Grant Date Using Monte Carlo Valuation Model (Detail) | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Expected term (years) | 6 years 3 months | ||
Expected volatility | 35.40% | ||
Risk-free interest rate | 1.82% | ||
Class M Units [Member] | |||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Expected term (years) | 1 year 8 months 12 days | 3 years 8 months 12 days | |
Expected volatility | 36.80% | 39.40% | |
Risk-free interest rate | 0.40% | 0.80% |
Equity-Based Compensation - Sum
Equity-Based Compensation - Summary of Class M Unit Activity (Detail) - $ / shares | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Class M Units [Member] | |||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Units Outstanding at beginning of period | 505.260 | 431.577 | |
Units granted | 121.051 | 431.577 | |
Units Outstanding at end of period | 505.260 | 431.577 | |
Units forfeited | (21.053) | (47.368) | |
Units converted upon IPO | (484.207) | ||
Weighted average grant date fair value, Units converted upon IPO | $ 1.52 | ||
Weighted average grant date fair value, Outstanding at end of period | 1.52 | ||
Weighted average grant date fair value, Vested or expected to vest | $ 1.52 | ||
Holdings Units [Member] | |||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Units Outstanding at end of period | 4,238,338 | ||
Units converted upon IPO | 4,238,338 | ||
Units Vested or expected to vest | 4,238,338 |
Equity-Based Compensation - F75
Equity-Based Compensation - Fair Value of Stock Option Awards Determined on Grant Date Using Black-Scholes Valuation Model (Detail) | 12 Months Ended |
Dec. 31, 2015 | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | |
Expected term (years) | 6 years 3 months |
Expected volatility | 35.40% |
Risk-free interest rate | 1.82% |
Equity-Based Compensation - S76
Equity-Based Compensation - Summary of Stock Option Activity (Detail) | 12 Months Ended |
Dec. 31, 2015$ / sharesshares | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | |
Stock Options, Granted | shares | 116,690 |
Stock Options, Forfeited | shares | (8,420) |
Stock Options, Outstanding at end of period | shares | 108,270 |
Stock Options, Vested or expected to vest | shares | 104,769 |
Weighted average exercise price, Granted | $ / shares | $ 16.14 |
Weighted average exercise price, Forfeited | $ / shares | 16 |
Weighted average exercise price, Outstanding at end of period | $ / shares | 16.15 |
Weighted average exercise price, Vested or expected to vest | $ / shares | $ 16.15 |
Weighted average remaining contractual term (years), Outstanding at end of period | 9 years 7 months 6 days |
Weighted average remaining contractual term (years), Vested or expected to vest | 9 years 7 months 6 days |
Earnings per Share - Additional
Earnings per Share - Additional Information (Detail) - shares | 12 Months Ended | |
Dec. 31, 2015 | Aug. 06, 2015 | |
Stock Options [Member] | ||
Earnings Per Share Diluted [Line Items] | ||
Anti-dilutive securities excluded from the calculation of earnings per share | 108,270 | |
Restricted Stock Units [Member] | ||
Earnings Per Share Diluted [Line Items] | ||
Anti-dilutive securities excluded from the calculation of earnings per share | 8,160 | |
Class A Common Stock [Member] | ||
Earnings Per Share Diluted [Line Items] | ||
Common stock, shares outstanding | 36,597,985 | 0 |
Class B Common Stock [Member] | ||
Earnings Per Share Diluted [Line Items] | ||
Common stock, shares outstanding | 62,112,000 | 0 |
Earnings per Share - Reconcilia
Earnings per Share - Reconciliation of Numerators and Denominators Used to Compute Basic and Diluted Earnings per Share (Details) - USD ($) $ / shares in Units, $ in Thousands | 2 Months Ended | 3 Months Ended | 5 Months Ended | 12 Months Ended | |||||||||
Sep. 30, 2015 | Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2015 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Numerator | |||||||||||||
Net income | $ 23,454 | $ 38,130 | $ 37,295 | $ 25,799 | |||||||||
Less net income attributable to non-controlling interests | 19,348 | 19,612 | 487 | 361 | |||||||||
Net income attributable to Planet Fitness, Inc. | $ 17,240 | $ 737 | $ 11,612 | $ 8,541 | $ 13,783 | $ 8,303 | $ 8,950 | $ 6,259 | $ 4,106 | $ 18,518 | $ 36,808 | $ 25,438 | |
Class A Common Stock [Member] | |||||||||||||
Denominator | |||||||||||||
Weighted-average shares of Class A common stock outstanding - basic | 36,243,557 | ||||||||||||
Earnings per share of Class A common stock - basic | $ 0.05 | $ 0.06 | $ 0.11 |
Income Taxes - Schedule of Inco
Income Taxes - Schedule of Income Before Provision for Income Taxes (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Income Tax Disclosure [Abstract] | |||
Domestic | $ 48,716 | $ 39,534 | $ 26,432 |
Foreign | (1,438) | (1,056) | |
Total current tax expense | $ 47,278 | $ 38,478 | $ 26,432 |
Income Taxes - Schedule of Prov
Income Taxes - Schedule of Provision (Benefit) for Income Taxes Expenses (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Current: | |||
Federal | $ 686 | ||
State | 2,188 | $ 1,078 | $ 2,063 |
Foreign | 139 | 168 | |
Total current tax expense | 3,013 | 1,246 | 2,063 |
Deferred: | |||
Federal | 5,636 | ||
State | 935 | 217 | (1,430) |
Foreign | (436) | (280) | |
Total deferred tax (benefit) expense | 6,135 | (63) | (1,430) |
Provision for income taxes | $ 9,148 | $ 1,183 | $ 633 |
Income Taxes - Schedule of Reco
Income Taxes - Schedule of Reconciliation of U.S. Statutory Income Tax Rate to Company's Effective Tax Rate (Detail) | 12 Months Ended |
Dec. 31, 2015 | |
Income Tax Disclosure [Abstract] | |
U.S. statutory tax rate | 35.00% |
State and local taxes, net of federal benefit | 6.20% |
Rate change on deferred tax asset from recapitalization | 6.90% |
Tax benefit arrangement liability adjustment | (2.10%) |
Foreign tax rate differential | 0.30% |
Withholding taxes and other | 0.20% |
Income attributable to non-controlling interests | (27.10%) |
Effective tax rate | 19.40% |
Income Taxes - Additional infor
Income Taxes - Additional information (Detail) $ in Thousands | 12 Months Ended | |
Dec. 31, 2015USD ($)Agreement | Dec. 31, 2014USD ($) | |
Tax Credit Carryforward [Line Items] | ||
Effective income tax rate | 39.40% | |
Effective income tax rate reconciliation at U.S. federal and state income tax | 37.10% | |
Effective income tax rate reconciliation noncontrolling interest | 2.50% | |
Effective income tax rate income before taxes excluding variable interest | 62.90% | |
Total liability related to uncertain tax positions | $ 300 | $ 300 |
Portion of unrecognized tax benefit, if recognized would reduce income tax expense | $ 300 | |
Number of tax receivable agreements | Agreement | 2 | |
Applicable percentage of cash savings | 85.00% | |
Percentage of remaining tax savings | 15.00% | |
Income tax rate maximum tax liability | 3.50% | |
Other income reflecting reduction in tax benefit obligation | $ 2,549 | |
Tax benefit obligation | 140,191 | |
Canada [Member] | ||
Tax Credit Carryforward [Line Items] | ||
Net operating loss carryforwards | $ 716 | |
Operating loss carryforwards, expiration date | 2,034 |
Income Taxes - Schedule of Defe
Income Taxes - Schedule of Deferred Tax Assets and Liabilities (Detail) - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 |
Deferred tax assets: | ||
Accrued expense and reserves | $ 353 | $ 75 |
Deferred revenue | 1,276 | 182 |
Goodwill and intangible assets | 113,460 | |
Net operating loss | 716 | 280 |
Other | 2,841 | 85 |
Deferred tax assets | 118,646 | 622 |
Deferred tax liabilities: | ||
Prepaid expenses | (674) | (94) |
Goodwill and intangible assets | (717) | |
Property and equipment | (614) | (154) |
Total deferred tax liabilities | (1,288) | (965) |
Total deferred tax assets | $ 117,358 | |
Total deferred tax (liabilities) | $ (343) |
Income Taxes - Schedule of Futu
Income Taxes - Schedule of Future Payments Under Tax Benefit Arrangements (Detail) $ in Thousands | Dec. 31, 2015USD ($) |
Income Tax Contingency [Line Items] | |
Total | $ 140,191 |
IPO [Member] | |
Income Tax Contingency [Line Items] | |
2,016 | 3,019 |
2,017 | 7,125 |
2,018 | 7,072 |
2,019 | 7,125 |
2,020 | 7,321 |
Thereafter | 108,529 |
Total | $ 140,191 |
Commitments and Contingencies -
Commitments and Contingencies - Additional Information (Detail) - USD ($) | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Commitment And Contingencies [Line Items] | |||
Rental expense | $ 18,186,000 | $ 16,980,000 | $ 13,830,000 |
Maximum obligation of guarantees of leases and debt | 1,871,000 | 2,896,000 | |
Accrued potential obligation recorded under guaranty arrangement | 0 | $ 0 | |
2013 Performance Incentive Plan [Member] | |||
Commitment And Contingencies [Line Items] | |||
Bonuses and recorded expense | $ 1,688,000 | ||
Advertising Purchase Commitment [Member] | |||
Commitment And Contingencies [Line Items] | |||
Purchase commitments | 15,530,000 | ||
Equipment Purchase Commitment [Member] | |||
Commitment And Contingencies [Line Items] | |||
Purchase commitments | $ 14,361,000 |
Commitments and Contingencies86
Commitments and Contingencies - Schedule of Future Commitments Under Noncancelable Operating Leases (Detail) $ in Thousands | Dec. 31, 2015USD ($) |
Commitments And Contingencies Disclosure [Abstract] | |
2,016 | $ 13,272 |
2,017 | 12,700 |
2,018 | 11,738 |
2,019 | 10,325 |
2,020 | 9,245 |
Thereafter | 44,802 |
Total | $ 102,082 |
Retirement Plan - Additional In
Retirement Plan - Additional Information (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Compensation And Retirement Disclosure [Abstract] | |||
Percentage of employer matching contribution | 100.00% | ||
Maximum percentage of employee contribution | 4.00% | ||
Total employer matching contributions expense | $ 384 | $ 211 | $ 214 |
Segments - Additional Informati
Segments - Additional Information (Detail) | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2015USD ($) | Sep. 30, 2015USD ($) | Jun. 30, 2015USD ($) | Mar. 31, 2015USD ($) | Dec. 31, 2014USD ($) | Sep. 30, 2014USD ($) | Jun. 30, 2014USD ($) | Mar. 31, 2014USD ($) | Dec. 31, 2015USD ($)Segment | Dec. 31, 2014USD ($) | Dec. 31, 2013USD ($) | |
Segment Reporting Information [Line Items] | |||||||||||
Number of reportable segments | Segment | 3 | ||||||||||
Number of operating segments | Segment | 0 | ||||||||||
Description of factors used to identify entity's reportable segments | No operating segments aggregated to arrive at the Company’s reportable segments | ||||||||||
Revenue | $ 105,845,000 | $ 68,817,000 | $ 78,952,000 | $ 76,923,000 | $ 96,019,000 | $ 63,467,000 | $ 62,697,000 | $ 57,594,000 | $ 330,537,000 | $ 279,777,000 | $ 211,009,000 |
Franchise [Member] | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Revenue | 88,085,000 | 71,806,000 | 44,157,000 | ||||||||
Franchise [Member] | Placement Services [Member] | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Revenue | 9,806,000 | 8,450,000 | 6,315,000 | ||||||||
Corporate-owned Stores [Member] | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Revenue | 98,390,000 | 85,041,000 | $ 67,364,000 | ||||||||
Corporate-owned Stores [Member] | Canada [Member] | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Long-lived assets | $ 3,149,000 | $ 2,011,000 | 3,149,000 | $ 2,011,000 | |||||||
Intersegment Eliminations [Member] | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Revenue | $ 0 |
Segments - Summary of Financial
Segments - Summary of Financial Information for the Company's Reportable Segments (Detail) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Segment Reporting Information [Line Items] | |||||||||||
Revenue | $ 105,845 | $ 68,817 | $ 78,952 | $ 76,923 | $ 96,019 | $ 63,467 | $ 62,697 | $ 57,594 | $ 330,537 | $ 279,777 | $ 211,009 |
Total Segment EBITDA | 103,985 | 92,619 | 64,152 | ||||||||
Corporate And Other Non Segment [Member] | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Total Segment EBITDA | (30,051) | (18,642) | (7,504) | ||||||||
Franchise [Member] | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Revenue | 88,085 | 71,806 | 44,157 | ||||||||
Franchise [Member] | Operating Segments [Member] | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Total Segment EBITDA | 66,030 | 53,109 | 30,123 | ||||||||
Franchise [Member] | US [Member] | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Revenue | 87,299 | 71,806 | 44,157 | ||||||||
Franchise [Member] | International [Member] | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Revenue | 786 | ||||||||||
Corporate-owned Stores [Member] | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Revenue | 98,390 | 85,041 | 67,364 | ||||||||
Corporate-owned Stores [Member] | Operating Segments [Member] | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Total Segment EBITDA | 36,070 | 31,705 | 21,742 | ||||||||
Corporate-owned Stores [Member] | US [Member] | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Revenue | 95,459 | 85,022 | 67,364 | ||||||||
Corporate-owned Stores [Member] | International [Member] | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Revenue | 2,931 | 19 | |||||||||
Equipment [Member] | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Revenue | 330,537 | 279,777 | 211,009 | ||||||||
Equipment [Member] | Operating Segments [Member] | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Total Segment EBITDA | 31,936 | 26,447 | 19,791 | ||||||||
Equipment [Member] | US [Member] | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Revenue | 144,062 | 122,930 | 99,488 | ||||||||
Equipment [Member] | International [Member] | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Revenue | $ 144,062 | $ 122,930 | $ 99,488 |
Segments - Reconciliation of To
Segments - Reconciliation of Total Segment EBITDA to Income Before Taxes (Detail) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Segment Reporting [Abstract] | |||||||||||
Total Segment EBITDA | $ 103,985 | $ 92,619 | $ 64,152 | ||||||||
Depreciation and amortization | 32,158 | 32,341 | 28,808 | ||||||||
Other expense | (275) | (1,261) | (694) | ||||||||
Income from operations | $ 28,793 | $ 10,338 | $ 18,667 | $ 14,304 | $ 19,338 | $ 13,956 | $ 14,706 | $ 13,539 | 72,102 | 61,539 | 36,038 |
Interest expense, net | (24,549) | (21,800) | (8,912) | ||||||||
Other expense | (275) | (1,261) | (694) | ||||||||
Income before income taxes | $ 47,278 | $ 38,478 | $ 26,432 |
Segments - Summary of Company's
Segments - Summary of Company's Assets by Reportable Segment (Detail) - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 |
Segment Reporting, Asset Reconciling Item [Line Items] | ||
Total consolidated assets | $ 699,177 | $ 601,982 |
Operating Segments [Member] | Franchise [Member] | ||
Segment Reporting, Asset Reconciling Item [Line Items] | ||
Total consolidated assets | 206,997 | 216,985 |
Operating Segments [Member] | Corporate-owned Stores [Member] | ||
Segment Reporting, Asset Reconciling Item [Line Items] | ||
Total consolidated assets | 151,620 | 157,868 |
Operating Segments [Member] | Equipment [Member] | ||
Segment Reporting, Asset Reconciling Item [Line Items] | ||
Total consolidated assets | 208,168 | 220,367 |
Unallocated [Member] | ||
Segment Reporting, Asset Reconciling Item [Line Items] | ||
Total consolidated assets | $ 132,392 | $ 6,762 |
Segments - Summary of Company92
Segments - Summary of Company's Goodwill by Reportable Segment (Detail) - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 |
Segment Reporting Other Significant Reconciling Item [Line Items] | |||
Goodwill, Net carrying Amount | $ 176,981 | $ 176,981 | $ 157,210 |
Franchise [Member] | |||
Segment Reporting Other Significant Reconciling Item [Line Items] | |||
Goodwill, Net carrying Amount | 16,938 | 16,938 | 16,938 |
Corporate-owned Stores [Member] | |||
Segment Reporting Other Significant Reconciling Item [Line Items] | |||
Goodwill, Net carrying Amount | 67,377 | 67,377 | 47,606 |
Equipment [Member] | |||
Segment Reporting Other Significant Reconciling Item [Line Items] | |||
Goodwill, Net carrying Amount | $ 92,666 | $ 92,666 | $ 92,666 |
Corporate-owned and Franchise93
Corporate-owned and Franchisee-owned Stores - Schedule of Changes in Corporate-owned and Franchisee-owned Stores (Detail) - Store | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Franchisor Disclosure [Line Items] | |||
Stores operated at beginning of period | 918 | 749 | 606 |
New stores opened | 209 | 171 | 149 |
Stores debranded, sold or consolidated | (3) | (2) | (6) |
Stores operated at end of period | 1,124 | 918 | 749 |
Franchisee-Owned Stores [Member] | |||
Franchisor Disclosure [Line Items] | |||
Stores operated at beginning of period | 863 | 704 | 562 |
New stores opened | 206 | 169 | 148 |
Stores debranded, sold or consolidated | (3) | (10) | (6) |
Stores operated at end of period | 1,066 | 863 | 704 |
Corporate-Owned Stores [Member] | |||
Franchisor Disclosure [Line Items] | |||
Stores operated at beginning of period | 55 | 45 | 44 |
New stores opened | 3 | 2 | 1 |
Stores acquired from franchisees | 8 | ||
Stores operated at end of period | 58 | 55 | 45 |
Quarterly Financial Data (Una94
Quarterly Financial Data (Unaudited) - Schedule of Quarterly Financial Data (Detail) - USD ($) $ / shares in Units, $ in Thousands | 2 Months Ended | 3 Months Ended | 5 Months Ended | 12 Months Ended | |||||||||
Sep. 30, 2015 | Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2015 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Quarterly Financial Information [Line Items] | |||||||||||||
Total revenue | $ 105,845 | $ 68,817 | $ 78,952 | $ 76,923 | $ 96,019 | $ 63,467 | $ 62,697 | $ 57,594 | $ 330,537 | $ 279,777 | $ 211,009 | ||
Income from operations | 28,793 | 10,338 | 18,667 | 14,304 | 19,338 | 13,956 | 14,706 | 13,539 | 72,102 | 61,539 | 36,038 | ||
Net income | $ 17,240 | $ 737 | $ 11,612 | $ 8,541 | $ 13,783 | $ 8,303 | $ 8,950 | $ 6,259 | $ 4,106 | $ 18,518 | $ 36,808 | $ 25,438 | |
Class A Common Stock [Member] | |||||||||||||
Net income per share of Class A common stock: | |||||||||||||
Class A - Basic | $ 0.05 | $ 0.06 | $ 0.11 | ||||||||||
Class A - Diluted | $ 0.04 | $ 0.06 |