LTH - Earnings call 3 2021 | Life Time Group Holdings, Inc.

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Operator

Good afternoon, and welcome to Life Time Group Holdings conference call to discuss financial results for the third quarter fiscal 2021. [Operator Instructions] Please be advised that reproduction of this call in whole or in part is not permitted without written authorization from the company.

As a reminder, this call is being recorded.

During this call, the company will make forward-looking statements, which involve a number of risks and uncertainties that may cause actual results to differ materially from our forward-looking statements. There is a comprehensive list of risk factors in the company's SEC filings, which you are encouraged to review. discuss cash financial expenditures. flow will EBITDA including company free and before the certain measures, non-GAAP adjusted Also, growth capital information, the the to measures, reconciliations X-K website. filed afternoon, along directly SEC company's section This GAAP and of the comparable Time on in the the are Relations release earnings most in with issued Investor this included with Life

I management and Bergmann, Please call from to today now Officer. Chief Chief Officer; the Akradi, Akradi Chairman are call On Founder, go the Tom Executive and Financial Mr. over will turn Bahram ahead, to sir. started. get

Bahram Akradi

to Thank our with as you public and first team afternoon, of congratulate all thank company on following a I achieving especially Time a Life once call and joining members great second the incredible thank close us for early you, want this speak Jessie. time. earnings for all in to our of you Good IPO again. for It's milestone October.

to turning them defines Tom address our share highlights third First, I hopefully, I that significant in future. to so provide have on before to Then from take the results. reinforce want details few the don't quarter our will we and business, it distinction again again over a to opportunity to the the additional

Life a lifestyle healthy is Time comprehensive, highly aspirational, differentiated, brand. high-end,

places, performers now and digital best as experiences, delivering programs, have the well. consistently We been the best platform

XX physically XX studios. way our when sports gyms not and weight to possible. to fitness of ages athletic nutrition, and we members. healthier, are We entertainment, a all all including happier loss, aim destinations resort for create old Ultimately, or years athletic for and comprehensive communities a from life, aspects provide both Our of digitally lifestyle healthy old, days training

brand, difficult-to-replicate with life through culture, our athletic in in customers, we trusted an position value opportunities team country, very a also opportunities and healthy to of of continue months. unique by last way of significant shareholder particularly growth the to resorts that long-term delivering emerged an Life growth, presented amazing ecosystem. the which Time of all leveraging millions all with We're the aspects the XX across incredibly are our have committed is

our in XX.X% in We EBITDA the Total $XXX in to XXX,XXX large this the $XXX related membership the quarter. our second restriction third million second quarter. to grew fantastic million during Adjusted $X.X (sic) in quarter COVID-XX being from XXX,XXX the over now revenue second quarter. quarter achieved million $XXX Center additional XX.X% $XXX had XXXX of quarter a despite in financial masking the from quarter. and we And second The revenue Turning the nearly ] of results. year. the in third from million XX% also just grew this the XXXX still XXXX from third impacted quarter quarter total $XX [ third quarter in by third grew to the third to clubs million grew in million quarter. other to

share. its capturing and a are COVID variation, continue any great from of Regardless we position turbulence to market additional in

end catching monthly We adjusted summer in in the the and adjusted EBITDA in expect memberships, 'XX to very our of ] first half exceeding robust of XXXX. adjusted have of XXXX, center membership dues EBITDA the monthly a recovery by EBITDA then [ and XXXX to resulting the up

continues development robust opportunities to Our pipeline with expand. new center significant very to be

and at During Florida. Northshore centers in quarter, Coral Mall Peabody, we Massachusetts X the opened new Gables, third

in of growth new omnichannel remain As an enhancement community the and best our also continued Digital very most XXXX, or of our Life digital with of platform. rapid is and position strategic wellness physical in focused comprehensive growing XX of We foreseeable the centers market. XX platform. new have we affluent planned great core and providing health for a members centers future for via beyond, September on under increasingly we Time XX, and resulting have the and construction, annually in more our experiences goal this from programming spaces our XXXX and

emphasize I now Tom? Life as Tom, the I want turn over to And it been about future I of more have never to Time. that excited

Thomas Bergmann

of I'll Great. detail Thanks, and additional third well for Bahram, and results the some provide our year-to-date as quarter our remainder hello, on the outlook year. as everybody.

the nicely affluent to of our in third our spending $XXX increased XX% comparable was increased basis, dues same more center $XXX increased with rebounded strategy membership in in of XX%. year XX% center On same-store increased revenue reflecting and continued markets. from revenue. and in-center both execution opening center to by driven prior membership new in quarter, increases to sales million businesses, period, pricing by the total $XXX increases centers in-center a million, revenue the per Average $XXX also Total other In revenue both the and center driven revenue. and center

just memberships September increased XXX,XXX XXXX, to XX, to of XX% Center approximately approximately compared XXX,XXX XXXX. XX, September as of as over

also Our sequential quarter quarter compared XXXX. the over reflects memberships of third the to ending of of just XX,XXX second center a increase end membership balance

some business of on and had including the quarterly North in the as pleased such across stated, memberships. various our sequential clubs during other quarter, we During country, Carolina, markets as in and imposed our restrictions typical quarter, XX% mandates third particularly the the our in COVID-XX-related are of Bahram and large the mask quarter. In light growth with restrictions during Chicago nearly these seasonality this them of jurisdictions

have continued Bahram we best members. As our very to our premium the experiences delivering on relentless focus shared,

our delivered continually our these maximizing and join we among most for new member centers believe and return prices per have the premium early center. optimal exceptional we we balance of increased our each membership memberships the have across experiences, deliver We the of refine we as strategically pricing As XXXX. in our find number experiences experience center, can

is XX% monthly $XXX the dues average rates per join is increase to membership dues quarter also XX% membership the we monthly was the this over average of higher opening per to more per the of new strategy able average increase Important opportunity and of $XXX third to membership dues than shows member in approximately Third charge monthly We membership our higher by XXXX of quarter the quarter of legacy average working highlight believe third new dues per that monthly in $XXX markets. XXXX. being in pricing. centers affluent in higher approximately membership and have time than

expect raise analytically prices clubs, member to are any while We member and thoughtfully continue at look data attrition. portfolio and across pricing to minimizing our to and we using analytics the data and of experience our

acquire new We membership to member members, and average legacy expect monthly open per increase more average and pricing revenue new dues continue in as per we increasingly centers markets. increase to affluent membership

were of iconic able centers, to business includes businesses quarter compared Other of than outside events of the the of several most produce our million forced revenue during as COVID-XX driven increased cancellation fourfold more we primarily generated events. from XXXX quarter quarter third to in of athletic XXXX restrictions the $XX our was our events and revenue, our of which to by when the third

occurring Center expense XX.X% operating to most nonrecurring rent by and XX% efficiency period increased at to million expenses to of reopening $XX.X possession and is $X.X X centers, $X.X which other operations primarily expenses. GAAP of increased and prior items. of $XXX.X expense year million our QX centers. since expense, the to on driven and versus partially share-based offset of and our In XX.X% Rent X included sale started million XXXX future third cost the existing centers addition we new centers million Moving $XXX X our initiatives sites total by for of primarily by was of the staffing quarter, where of increased productivity compensation and million, incurring taking the operating leaseback of centers driven noncash. the

compared administrative third increased is nonrecurring who the XXXX and share-based X.X% during expenses. decreased X.X% $X.X operating team increase marketing $XX.X XX.X% General, to expense and corporate million of to other and in furloughed million, the million Depreciation to compensation with and during remained XXXX. increase million, quarter an of third of clubs the decreased quarter This of million. spend $XX due to included primarily amortization $XX.X to quarter more of which opened expenses of members and $X.X XXXX return expenses marketing the third

As $XX.X from a operating of our result million in loss period. million our year recovery, to continuing improved $XX.X prior the XX%

last year's third to quarter expense in quarter. from during balance third is average due net this a $XX.X $XX year. debt the increased Net This interest to million million higher

operating loss a prior allowances quarter result in Our year tax third valuation XX.X% with was of is tax state period. XX.X% compared our net against rate rate primarily the This lower effective carryforwards. effective

was which compared net and of million to of primarily loss of year, tax-effected on included $X loss a compensation properties. one loss related a $XX.X our share-based this of million Net million nonrecurring quarter $X.X $XX.X expenses sale-leaseback million last a related to with

of Finally, as the third million improved million significantly loss mentioned, $XX.X year. Bahram to of a adjusted from in $XX quarter EBITDA last

the Cash of million as equivalents million sheet. XXXX. on September December of balance Moving as XX, $XX.X $XX.X to to cash compared XX, and was XXXX,

million loan know, We of related secured to penalty and prepayment approximately of $XXX included the all million million added which used to purposes. completed discounts cost. a $XXX proceeds our corporate this we which and the facility, for As senior offering balance $X.X earlier proceeds other generated general IPO you term after underwriting cash repay month, sheet our

purposes. additional the $XX in option the the X.X million to company stock for yesterday exercising net shares commissions. purchase net to share IPO $XX.X Additionally, were they price, notified of of the common nearly deducting the their million and We at additional corporate proceeds which IPO per underwriters underwriting company that will the after general use result intend in to approximately proceeds discounts

million is quarter. in club due year. $XX.X number clubs capital to prior the higher totaled just Net were of new The year's quarter active $XX.X our projects third when during third and of maintenance increase increase a million capital an many compared last opened partially reopened to during construction the expenditures in compared with quarter expenditures or primarily the

outlook. to now our Turning

to is nonpremium, for leases the where mask expire. currently the allow For are closure to this and the expected to related QX restrictions to COVID-XX be centers in guidance are million EBITDA $XX is that elected do in affected remain smaller is in expected Included clubs to has clubs the million mandates more guidance of to and Also right in range this other $XXX and assumption underlying under the impact million. $XX today. XXXX, X million, restrictions company the that than adjusted not current place is range nonbrand of the $XXX of be revenue

other and With adjusted continue lower quarter staffing compared to as to the team and cost we EBITDA benefit the insurance initiatives, improve this costs guidance, to real efficiency we margin expect member and expense. XXXX estate fourth quarter benefits see third our lower of of tax

I continue before want and the Bahram positioned well how to closing, is healthy to market for gain I So to share how join as am experiences grow. continues sharing pleased demand living company with to in

development Life are living, to healthy Time our opportunity asset-light serve the attractive real and rapid brand, for to aging and North America. for future and our demographics more across consumers member expansion With and healthy the believe poised I the we estate foreseeable more model, bring

deliver Life and up, our healthy wrap continue life strategic on comments the for of members way we extraordinary to who unparalleled reiterate it advance team priorities. I Bahram's members Time our are how want To to experience of proud an

to turn I'll for that, Jessie, call open And it back questions. the to you, with up

Operator

Our the from [Operator with Brian Instructions] Stanley. Harbour Morgan question of line first comes

Brian Harbour

the IPO. completing on Congrats

you place? So Did for if some differences that some fourth. on happened significant of the were of perhaps maybe the What trended quarter? and restrictions kind comments on October, had clubs the the at just all see you lifted during of sign-up any trends. maybe how of curious a sort first Have in throughout just question that been restrictions quarter those -- membership into

Bahram Akradi

Brian, great that's a Yes. question.

grow of the stopped basically but membership clubs, really back moment up, didn't didn't mask the down, They recovery. of sort membership. clubs sort continue So their those they go the the to mandate showed

sort it. an like and if new coming saw mask But surge on mask the now of coming mandates signing So when positive it's that, when that lifted, memberships is we of mandate the a clubs get gets had hold the mask lifted, the people about prior that mandate immediate back up. from we you news think is to break

So Tom?

Thomas Bergmann

mandates versus see difference add, mandates I a the performance that Yes. I mean, play. just come definitely imposed performance It's would we we quarter once into with those in third yes, the in X% with about clubs dues during Brian, that saw to difference those mask X% didn't.

So change. substantial pretty

as a fluid know. It's you very environment,

as mandates here X. positive And expect that different jurisdictions, it's be or being signs mask quarter the it Just lifted, yesterday, some still for we found know, in to there. clubs that's we too But the so early. our out of why X next you fluid

Bahram Akradi

But as I continuing our is turbulence these I've is advantage. insight, we're is monthly the this coming as in picking all looking important, work where our we're really of to looking that basis, additional see these, mentioned our where of all everything a up people mentioned -- where before, to earlier the my We're member all on to in regardless, situation at coming back. of remarks, from, a are

right last the And dividends years obviously the are many way some just team we've paying them So of is but and other from huge now. coming for places. handled members members, X.X members are

Brian Harbour

pricing Maybe just some that, certainly. detail provided which good second Great. strategy, the on you Okay. one on a

up the started still In fast members, picking think of the actually yet, observations guess, I or you legacy about of yet to if the what How kind that of that? of are that? you? you would kind magnitude And pricing terms ahead some is happen your do on do And of of have any can has be? early of that done you that some what

Bahram Akradi

Yes.

and try. can can will best color you give numbers. Tom you we you I so us work Let the your give

at tough a year, and it. But sort per million, very at from we one of somewhere are the to it's $XXX huge that who in So We when $XXX standpoint. out attainable plan all intelligently annual our versus rough That's selling gross are customer-friendly about the roughly, million laid take you time. look never prices and of not would dues a amount, current paying we do that about and the is revenue. not price, very, of that and number, X/X have members

increases you XX passed haven't for on said look any Having increases to across price that, the months now. when price at we else, everything anyone

So kind price will the biggest analytics on another then little very, plan of January. and then December, at people let bit. some get AI as for own is me mentioned just a before, and to our our very is The group regroup we opportunity and deploying pricing, first getting sophisticated of early increase it Life in Time And batch elaborate that.

pools more clubs different our of are beginning the the of the price today you or our this fitness, the over and the increases XXX below yoga, whole significantly for types, fitness put than clubs we per studios place the that everything, single of the modality of other for facility, whole XX% today, thing different When per still right now, spinning, XXX, month. And and types offering even look after sports. at would yoga, in all for what classes for cycling, offer last year, types of week group prices

what still had low few on mentioned as have significantly been all I when priced too we sort happened years past the But of had very, raised you're at as price. of to we the -- company we guys, behind. the very considering the prices And the you had with significantly calls all So to all last has we and businesses, other cautious we're methodical get-go.

rack we to confident now, to continue where adjust rate just little legacy one So we tiny the still be the also feel net those are offering and we pricing rates to not rack below incredibly only thing. can substantially room have that studios add again

helps hopefully, So that you.

opportunity future. the of the we foreseeable kind to Tom? numbers We there have significant deliver need to in

Thomas Bergmann

Yes.

covered most doing we in company a Bahram the this. have it. Well, experience obviously, of I of of think lot

and company. artificial it member then And thoughtfully better later do getting keep to way. the friendly within analytics, they intelligence in better on, and continue we'll the data a So

pricing our note But of for join average point, than to new still I legacy to rates our we have XX% think members, well are price. Bahram's significant power member ahead over our us. important And higher legacy that it's

our for move members and very room And increase had lot of legacy years. a So over not we X these a also have members have up, again, to analytically. legacy thoughtfully price

a lot that gives us been time. of it's yes, -- So

XX acquisition portfolio. yes. see now across -- months we prices, overall performance higher these the we're And still So strong very into and X,

a So confident of of got us that I think we've Bahram pricing and I fair ahead really still. feel power amount

Operator

is with question next Robby of Bank America from coming Our Ohmes Securities.

Robert Ohmes

I expectations? recent Bahram that how location, And that you was, New to Coral opening questions. it's had wondering you I residential applies us? on that future vertical the can One again, gone Gables, speak and X very anything -- to those was early. there versus I Tom, are learned know developments to is I the performing But how maybe could and But Gables has know if York you've maybe early. highlight Coral other it's

my providing efficiencies on as And maybe efficiencies, contrast as cost other are speak you great et to staffing, staffing gaining you're can experiences the with how commenting cetera? guys then question, -- just of sort you with that member

Bahram Akradi

It's it great I'll it Tom. to then questions. give and take

take it it in let relates as So me reverse way. --

spending less X. role money clubs corporate, of X are the relates efficiencies we we clubs, it because layers. those member concierge we had in substantial, you Ritz-Carlton. Where services what are highest about finally, corporate level, the experience we driving department Four That at desk, call one, needs the we The the like between member the to member things or we it was the are program. middle Then As which used -- to is the number field, more sales took of either the for promotional substantially making department department because a sure the it between we to the roles running not services it positions and a took we in what services the We less mentioned then We're eliminated staffing, not that. consolidate and in heads total our superior guys, into was as these front to into are be head all. have sales member concierge money took consolidation and is the pristine, to at into head on system, there. XXX sales Seasons,

you other are the memberships And the working. question to that asked,

because mean, internal every with now, hitting no going we We're -- to that and beat some month, trying through expectation. pushed our promising club internal this sales no beat get promotion, all not actually it It's those for have I promotion It's we is organically. this are going right not our We're numbers goal forced. is to salespeople. really that happening to So month, of every in.

it's But the working. So there. savings are

The other all it's charge. place of to same member amount the card the from on credit those of couple card will a was savings the worked will which when into almost charges, credit be out, the -- X.X% percent, X. positions consolidation X about that's on X% of It

intelligently very So a really want Ritz-Carlton done more this sort Four we with a the being clubs that of in delivery. mindset actually have to more we more invest Seasons,

So they're cleaner.

We're frontline staff. care our paying to so comfortable they're very better employees more that have taken of. We

Thomas Bergmann

on And add Coral Robby, well. extremely question, it's going your just Gables would I

premium is some a ramping So that's up there at has units market. faster they really Gable new good landlord ever learnings. Coral Time have That the been rents Life to is than what The in branded village with Living.

So ramping as the pleased extremely the is club ramp landlord extremely well. The well is there. with also

not there I said they're project, mid-August, Life We early. Time even lot think on the another real a the it confidence. of doing developer, landlord involved it's it. but in shows again, and signs, early So estate it opened being without And

good So learnings. really, really yes,

residential talk I developments, long about projects active that I of opportunities reinforces can under think vertical growth are those discussion. and number time in and a Bahram the our it

really are positive. signs early So

Operator

with line Our is the Guggenheim. next coming question Heinbockel of John from

John Heinbockel

out upper going me -- your more, your XX with, curious are share and are to I'm you let income a where of to that, of there. years or maybe guys, right, I'm do you And So ultimately, XX share where cohort? think think coming could as little million that over from where from? be thinking out part are there's going households start gains come

Bahram Akradi

Yes.

the look members. Time people we joining basis, as are on these Life about -- at a past regular the X/X So of

really coming X/X full-service of Life larger isn't emphasize fitness other a athletic there coming like that's resorts just Life other So About Time. Time. back Again, lot to are from providers. we

bit that are from a bit, from quite coming is they're and fitness. type back quite lot coming coming interestingly stuff, home a And from of So studios. enough, a

is from the see omnichannel, that we hear omnichannel, we about what and is omnichannel now What -- talked is omnichannel. we hear well-being really anecdotally in an right -- constant and the a health What using on what customer this we basis. basis, analytically

morning employees early some doing on of own our are come club, work. in our they the the classes of they're to workouts Some before and doing the stream in some

the answer -- XXX% several that able it's think actually I last So digital the an level on our that is And interesting been physical, watch we're have we or not observation confidence it's is what omni months. basically to visibility. for that

Thomas Bergmann

been of members. well to reimagine that, give in XXX, that's to locations grow ever is we Yes. Coral would going Today, suburban now digital urban million real the we've look we years, sit I to Time about as more of ability locations, your the our helping is the as space X, locations. XXX, this of that XX malls as in he's that I vertical traditional pipeline households. Bahram when XX white estate why seeing just than success at opportunity we're our model, that next the side-by-side And between us and it. got Life on transform he's we all and think XXX excited top then high-income those potential experience John, to we said And Gables the physically with add residential, on and And over comment the only reach as can XXX with get well

dislocation from term a in Life the is think yes, close the half because proximity who part to it gain of Time. short continue to So Time the long leave moving of with away I think, term, leave But industry. Life people over know we'll exciting the they're we I in that the

Life that's to a member. going we to people the more give opportunity locations, become more As Time grow

John Heinbockel

And been then with signature maybe do I -- you about signature, it's secondly, the just think would what's tiering the have other what's But experience which how And early, even know. and amenities? something beyond membership? generally,

Bahram Akradi

question, question. Yes. interesting great Again, It's John. an

literally is will standpoint Signature. basis resistance in -- expectation product and mentioned on is year, virtually what We difficulty our or a get Do I try into tier modeling services and of create dues working my year. an another a achieving that $XXX-plus. by of But of go are now. services the What to we a end daily of sort then what that assortment is basic? and can have to average you from that next tell I on by right of a about was goal it that to has roughly see bucket embedded next no this Tom maybe second end our $XXX-some

we're $XXX, but for rate single those $XXX maybe that to $XXX then club So person. membership the -- than -- a sometimes the than opening for $XXX it higher single -- $XXX single family are a that. coming not some memberships and less really number. -- to of is any in for or a The $XXX could a on be allows clubs much us up it rack $XXX, The

or low. an $XX too literally been a these opportunity, we It's for have that mistake these so the charging But of past we to can't this created little And million sort out. replace too earlier $XX made way mistakes. million, sort today, have pricing significant you We of just honestly, in for from them. and have we just assets opportunity the

we those rate consistent keep delivering the the for consciousness we with with fashion. about huge to customers, continue our a in and opportunity methodically keep So and and have that going experience adjusting to talk

Thomas Bergmann

well I Buckhead our Atlanta, just almost next openings except at markets the X can every and at we're are Jay, XX for the going when pipeline opening I affluent you when look $XXX look where dues into some in of If John, Street, Wall XXXX, for average you one. for year, at year, like next our look over add, new club

premium, into of So existing continue affluent lots this we in have is where the drive clubs, opportunity dues existing our to to pricing -- price here move plus as we more our up. power average these core continue to markets,

Operator

with question coming from Nagel Our next Oppenheimer. is Brian

Brian Nagel

Welcome public back to markets. the

Bahram Akradi

excited. am I

Brian Nagel

in question impressive I talked year-on-year and But just average want your prepared in the questions to to there looking anything the about now first center back The I of know gain abating? can in members center membership, the I Is response have, us... question per are at now COVID you is comments some pricing. seeing really the revenue ask, tell as come you you

Bahram Akradi

netting actually there's We able significantly So memberships have typically XQ, year. last we've flat. it let's no in be XQ. down in sort membership the we to seen but And typically year, this same in less thing. than is slightly, this go net July, We our September, walk will every gain through years. lose membership this year, membership memberships down lose of XX, were Where typically. ambiguity. may every so XX other drop gain June. typically the membership in through we year, XQ which And we August then And years, significant XQ, basically --

a lifted happen mandates mask you. we I as next those were if not possibility Now all because week, have to tomorrow get would actually or that a we there's mentioned will surge,

every Now membership year, significantly of absolute which X year, all count. will And our gain the year quarter, we for robust second memberships we the to and throughout an is be months. when it expect we in gain the normally first

per on plan beats EBITDA. of plan on very good XXXX how to plan, mentioned, run month we And we rate by Tom's -- we I As projection that you we is matches want give there. get guys good very all or my have EBITDA have can a summer per month how

monthly end that XXXX the to then expect EBITDA we And the the by XXXX, EBITDA. be exceeding of have

sort that's That's expect what So working of what we to what that's we we're happen, deliver. and see. to

Brian Nagel

kind you into digital offering. could been How, integrating you Bahram, of standpoint, the the from just about also just the you a consumer the experience -- centers? bit what offering are a the of physical mentioned talk digital has

Bahram Akradi

Right.

-- of X.X-plus them every we our of that So million app. our X.X regularly customers, right are million now, using have customer

We that more what see like, are studying what every day robust. they're to using, they make

just of are that we stream classes in everybody be and we're clear I or X,XXX our we of want we to clubs, a members about going. open those. our it's of if XXX those X,XXX to It will a schedule -- week matter of that to out decide We about streaming just XX,XXX-plus clubs, streaming them teach want take to them get to decision. week, our a

we've -- been working. are we So

have that X it X much, on to need on sort -- platform next decide get of $X? us how great, so transfer need much we without a power glitch the in any the we things: basically be does need so X, determination Once We we months, will XXx then a robust or we it programs more Does it promoting make XX more Does as much is working we you're b, a, individually; will put will behind something. be sort that using allowing XXx, that be marketing $XX? brand-new it those to expect there. happens, to of have which platform, already experiencing, engineers a into to people we what

app that our to that see club we be not come able use when happy really meanwhile, able to to whatever. is they're customer But or to

They one-on-one can can do do They nutrition. do they the can weight training. They meditation. content. loss. can get Now get They

the to very few to. it, we And new next launch really very Source, that delivering next Health add weeks, help very, continuing of a content Talks in robust. launch that it's need version Brian? features. version you, people listen with Health we're the comprehensive, Does is And month, version. which This every So then -- to our podcast we

Brian Nagel

the helpful. No, that's great. congratulations That's and here. of Well, luck best very

Operator

is question line next Markets. Our Instructions] the Simeon with [Operator Siegel coming BMO from of Capital

Simeon Siegel

congrats quarter markets, also, to And exciting Great. on the first back stuff. public

XXX,XXX So the Bahram, just know know, it. I But let total the just were within so members you can quarter memberships? said the what in us don't you if

recapture then the going then are And decline thinking back And the much digital from on Tom, forward? about of conversions center to maybe memberships? hold that rate how how came you of

Thomas Bergmann

you X.X XX between September June over of couples mix you from just the as and million members memberships families, September as XXX,XXX Yes. single, as to XX to The get quarter change transition the XX. come a out

exact over it's I million So XX% come full versus moved the hold, on numbers don't what X.X center of came Typically, back back. out. to of plus just have members. what -- we're

So now... right

Simeon Siegel

Yes.

opportunity we to back. look at convert for fine that, As that's you guys

Bahram Akradi

Yes. Go ahead again.

Thomas Bergmann

It's Yes. because We one with hold. with on we keep opportunities our in digital them is stay engaging those members them. keep they're We -- touch on hold inviting while best or those favorite obviously It personalized no basis back and of to their members and acquisition virtually a activities back. to club come cost has a instructors. bring favorite their enjoy on of

memberships it's to So -- levers it's really access our full use or that we short-term pull one really back center to can of full memberships.

Bahram Akradi

you X-month is To clear for there a window guys, be Yes. with also this.

on go hold, you if So you you are back. when coming decide

us give Or on be you for maximum, You hold months. X that date. can at the

on roughly it's at to these the So XX,XXX, are right people up of go they don't But rotate they hold memberships Time These really membership. -- are ones these this intention they their can members XX,XXX who that period And the sort are or of have Life gone give the hold have back who now, pros. hold then if automatically coming to the to. moment, back. those on they And really need in. want

arm back. a lot twisting of come require them don't for to they So

Simeon Siegel

dues I if going the more. then forward? just How And one are revenues about you have in-center thinking Perfect. versus breakdown of guys can membership

Thomas Bergmann

center to taken we've of in-center dues rebound we've revenue XX% a to call range, slower Yes. price the the XX% and that it increases the XX% pace dues than future, think the of Well, XXs, so at In that upper historically, business into slightly it's going given the dues to to still run XX% revenue. run I our about recovery. total

I as a percentage So we're at center think dues the still upper of total revenue. XXs looking for

Operator

Our next Fargo. Dan from is Wells Politzer coming question with

Daniel Politzer

fourth mask an the Congratulations quarter, seasonality quarter quarter offering. the backdrop the have on membership. the and of typical terms mandates of and it out. versus place to It I getting Bahram, right of bunch just of and dynamics a wanted improving sure kind on back I seems the make you're in there's on in and recovery taking you fourth then the against third back so the your like I circle commentary different understood

how quarters trajectory your -- just the recovery in should I of next So memberships? terms couple we frame over of the

Bahram Akradi

Yes.

massively, important XQ and a this that's goes XX,XXX sort typical September of gain not think October, year, I more month, or season don't membership lose membership. with year. typically quarter. a It's a back the most some robustly, of December, in whole drop a flat, And probably really we the equation. That's It's sort memberships come is and it it then is pool second a of So quarter just on mean I every and to drop People of the And piece XQ, XX,XXX, normal Time. first then -- Life for normal net out a a we or year. through seasonality. November.

all of still sidelines This the COVID people are year, sitting closures. massive on there amount from the club and

are there and the be I what to an grabbed. to say, So interest. across abundance their going best They on for -- of, is would programs services customers look

So get the but and on mid-summer, XXXX of we expect dues, the -- -- by expect we additional basis. beat a early early by point rate to can the to dues membership get the basically numbers count EBITDA enough And to monthly numbers mix summer. EBITDA run where we access

because than waiting the -- will And there that's are past just So June, typically December than This May, year into this start after years. who to all coming will May, was sign-up. massive the it's be other more happen, years June to -- on way really, when maybe a membership like is July right more our we is just more people April, going robust as June the robust seeing robust Christmas sideline. more from be demand

those We're tired will they of And community some clubs. home that up. of give guys, definitely athletic get and everybody don't of to will are workout, some and every up of their the confident to only people, we can they they get People it back home, give clubs some but this. We at will their go do Not see day. in some alone. the differentiation large they home that stuff think doing

a have, X, So to ahead we of really, X that's robust us. really months expect what

Thomas Bergmann

Yes.

would saying memberships. and off-brand with fourth the in to be the We're by X mask closing I mandates same I going. restrictions and choppy thing Dan, summarize small away quarter, COVID it's take So clubs X,XXX all will coming those going the mentioned. That

So the when we'll those look on adjust quarter to make sure for basis. we're apples-to-apples at an we

we the business think well. So think term, I important But I understand so is choppy. what's short it's

aggressively year marketing the now marketing position the and consumers focused running then in and ourselves the really the fronts we first wellness. season really into year on all campaigns fitness so working We have sure holiday are next teams really engines we hit December and on can that Black Friday going well are making their on of as the when really

done a being work now, of So really now. lot really right

Daniel Politzer

developments? sale just for And I real for it. I mean, conversations some terms your and of cap real estate appetite rates dynamic, supply-demand of your Got follow-up, for then in with of in the partners are leasebacks terms what my like estate guess

Bahram Akradi

this of sale-leaseback we in to cap that's But are shortage X.XX%, record get as definitely rate want we X.X%. robust get standpoint. is there to range, much ability really Well, X% I rate. that done of from low cap for as that mean, looking no X%,

can to get less, methodical. more look the done. we we at maybe slow work at or as is we and It's to X% plan we've get as high. much is a to to more with it. got continue demand that touch want But get are think done attractive, If Rates to market. kind want little a I of it

we I've more mentioned front, we On the you, -- as new to robust. are have

resi high-end are that with or need, Time what whether experience a delivers. company the landlords really Life We customer deliver capable mall, to the only today if they're

than So any company. the in discussion of we remember in period history I the more are

Thomas Bergmann

Yes.

I we think committed Bahram and owned company, it's billion a are and to Dan. I of in $X.X reducing real good over this leverage reminder, have estate.

opportunity. sale-leaseback at continue more as the to rates attractive, look that we'll So become

Bahram Akradi

about those books, estate real worth that would Tom gross Since -- at like I construction what excess have numbers well value. market billion. book is the that talking we in number more am, -- is in the is he's of the $X.X say Today, not looking I

You it. can't replace

Operator

from Carril Our RBC Chris Capital with next question coming Markets. is

Christopher Carril

So just on up about following question in-center revenue. maybe earlier Simeon's

how the about and here. just services October the and you're going you're curious those during revenue Just demand growth opportunities seeing trended in those how in-center thinking XQ near-term for and perhaps what for sales forward about

Bahram Akradi

Yes.

of items working much are with than in training, systematically transformations We're activities of to So back moving are the great memberships going higher now. Cafe. is the our those growing level the opportunity lots -- -- The grow the the menu we in right all on personal on. expectation are fine-tuning they to

the traffic, closer As get clubs those their revenue full to grows.

guys what used are we one is drags and where have up what to little others. So traffic, emphasize count that they to to pretty these PT I want to bit to. back is you markets up right things -- compared a of utilization, that all membership the much

the We get Therefore, margins think that point X.X the We to in to ways, -- expected have other and PT it that we programs PT, to up in that past. do in-person consolidation that from going of to we would implemented, other call, with EBITDA make revenues not PT that used as of up is the the kind some ago. mentioned that for other generate that years come as the have I -- be of of that to the from have the has the to the earlier similar some roles, reinvented, have savings. we the it

So the we EBITDAs from clubs. expect to similar achieve those

XX% did XX%, maybe revenue than lower point, we PT there. a it was about this At lower,

have Spa, up, beyond of Cafe, to the a where reverse incremental and and in marginal And lot out Now and to implemented that the if all we margin, figure terms we those. margin really, then really all PT But back revenue of and both to programs. get for Kids, is path be was else interesting that a it would go can everything back revenue going of have company.

seeing have We kids have traction for twin XX-year of X-year-old which programs those between old, sort We're to before. a classes. we the for great didn't

the been have get as robustly. And some the those been -- the we we sort that And just things really we've XX have have we're more of findings chance nonstop months working. good so reopened. new are reinventing last to out in And really, rolling

Operator

JPMorgan. of Montour from Our Brandt with next question line coming is the

Brandt Montour

Can you hear guys me?

Bahram Akradi

Yes.

Brandt Montour

of want lists And the one situations answered. -- I I know of of have terms congratulations your I the I lists is -- up But brand repositioning a is questions wait yes, major is brand? talked are question. have the sort to not most of the to we at where the Is prevalent something And past. for thing. offering. the at really spirit that talk clubs. clubs? it I levers the big know your in know of about there and it's of higher echo a it's of about Most growing? this be exclusivity that pricing, in also lot of on of, the in the there, been my Is and end, wait you that a lot of will repositioning you one sort but a pricing the didn't lever are come that brand

Bahram Akradi

Yes.

will that of a clubs. we we figure get significant them having perform and clubs how then those manage go And of going So have list that same clubs The this to The have are people XXX, have they wait is we we new to have to strategy, going club. doing can we're how going top-tier to approach, to new to And you've very of up. how club. them would so how to to go certain out is -- XXX, wait for buy out We're are to the more a to had list high-end got of not where with when XXX they're any to sort a you -- visibility open program membership method. what let kind still robustly point to membership going launched a they get that them. exactly to have figure for again, opening the the where to you have clubs these challenge to that create with -- same

always been challenge. that's So a

to manage way the the we that adjust price. So try is

$XXX Arizona. we month. example, opened like it at is an went as $XXX. $XXX up to We This a Biltmore to to went just So in and then moving $XXX. We

you? keep can we the rate in So precisely where that want rack membership can basically help up club the balance we Does the till to. adjusting we

Brandt Montour

exactly looking it I was me. And that's for. for And again. what congrats That's

Operator

Thank of our reached you. have we Ladies the end and question-and-answer session. gentlemen,

additional I'd or like pass over So to any to for the floor comments. closing management back

Bahram Akradi

in thank to thank have been guys quite all Jessie. I the and want and to I and stepped want bought have confidence So some They more. helped you, thank want all new you thank of to time, the this I shareholders again. that us once great transaction. with for partners and company. existing shareholders who they us even in our stepped achieve up

team We to are have sure to we make committed shareholders as to And to fantastic deliver customers, you guys do will a our can all our we we always members. to and us. investment our been with have

you So guys. Tom? with to thank that, want I

Thomas Bergmann

today. you Thank to appreciate soon. everybody. us you Talk for joining Really

Bahram Akradi

Bye. Thank Jessie. you,

Operator

and My and webcast. conclude may lines again, pleasure. we and this you gentlemen, disconnect this your Ladies thank teleconference today's at you for participation, Once time. does your

Life Time (LTH) 28 Oct 212021 Q3 Earnings call transcript