Life Time (LTH) 25 Jul 232023 Q2 Earnings call transcript

Company Profile

Participants

Ken Cooper	executive
Robert Houghton	executive
Bahram Akradi	executive
Christopher Carril	analyst
John Heinbockel	analyst
Brian Nagel	analyst
Brian Harbour	analyst
Robert Ohmes	analyst
Chris Woronka	analyst
Daniel Politzer	analyst
Simeon Siegel	analyst
John Baumgartner	analyst

Call transcript

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Operator

Good morning and welcome to Life Time Group Holdings Second Quarter of 2023 Earnings Conference Call. 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 conference call is being recorded. I will now turn the call over to Ken Cooper with Investor Relations for Life Time.

Ken Cooper

Good morning, and thank you for joining us for the Life Time Second Quarter of 2023 Earnings Conference Call. Bahram Chairman are Bob CEO; today CFO. Houghton, me Akradi, and Founder, and With

or the make this may what company involve leverage call, is comparable those and before this our During directly we will today. free the Houghton. made of morning, of with to reconciliations materially There turn measures, the pleased refer and growth to to and comprehensive section forward-looking Relations results flow most statements Also, Bob issued discuss as will the GAAP our a measures on Investor website. the forward-looking risks with in filings, call including EBITDA, you debt filed SEC company's I'm financial our uncertainties net adjusted now net actual of cash that along cause EBITDA Bob? discussion a factors differ to are ratio the to which debt from adjusted X-K earnings company's company are to certain SEC number capital included which information, expenditures. This statements, risk the the encouraged over release review. non-GAAP the to in

Robert Houghton

our morning. then business provide good results, his and thoughts reduce review will and initiatives, you Ken, our the for continued cash are appreciate strategic strong and business, our which to flow include profitability, which leverage. grow you, increase Thank second quarter us EBITDA improve adjusted update. Bahram growth. joining briefly will all financial I We our XXXX revenue working quarter and on

Total enrollment in-center from we including now Center first digital XXX,XXX. increase hold a are at $XXX to XX% memberships increased memberships. approximately with increase Our on and subscriptions, in in increased million, revenue. second XX% a revenue membership quarter, June XXX,XXX and dues and by approximately memberships XX% fees ended the XX,XXX driven quarter

loss generated quarter. the $XXX XXX% Adjusted prior center quarter. $XXX, Second in net compared second quarter up to and of from net year quarter revenue average the prior XX% $XXX income of the million We $X increased to per in million. for a million EBITDA $XX increased membership year with

operating Our quarter in as in of We by quarter in XX% million XXXX. Rent cash we increased quarter. delivered million flow the $XX percentage improved quarter. a versus year prior by second versus activities net prior revenue the in margin adjusted of net $XXX points over XXXX XX.X% of with quarter have million of was provided million XX.X% Year-to-date, year cash percentage to $XX the in EBITDA period. XX% $XXX operating activities the XX another second of provided prior by the generated of and cash versus year-to-date

our in We the are incredibly performance pleased of first year. this with half

sustainably EBITDA in are Our at strategic growth adjusted and successfully initiatives profit revenue margins. driving higher

in significant We deleveraging of rapidly the opportunities are number we our are a to our sheet. seeing asset-light and grow increase business balance

turn revenue experience confident we forward, the Looking unique club to now call I Time. that our in unrivaled remain Life the is country to to athletic continue earnings growth and while delivering member will over Bahram. ability providing in

Bahram Akradi

very everyone. objectives. progress Thanks, pleased quarter good in our main second I morning, am Bob, the and with towards our

team all are and our initiatives strategic and is focused off, excited. Our paying

see experiences of at the at opportunities. Net decreased end are to EBITDA these and the operating great second to dropping it the debt fast to year. same is and adjusted very Xx grow and at We're to last compared quarter same X.Xx pace period end company, delivering asset-light delivering best programming margins. to securing has of a quality the and more time, the are we're We to we our at opportunities members continuing

this rapid quarter. to third the expect deleveraging We in continue

recessionary some potential guidance. included headwinds our have in We

are we seeing not yet. impact that However,

below was the was June attrition rate XXXX. before, mentioned have we month our As first that

our are now through Life our financial strong brand. perspective. Based these sentiment will We member on and which July maintain half trends Nevertheless, conservative reflects we the and Time first August, to results to despite $XXX our adjusted reflects conservatism, adjusted we're million. still $XXX million to $XXX $XXX XX.X% EBITDA EBITDA This XX.X%. to million from million full our raising an to year margin guidance of seeing

are our $X.XXX club the in full guidance midpoint We also billion $X.XXX year billion year. to later for same despite and maintaining shifts in revenue the year narrowing some to the openings

$XXX million million For $XXX the million. to be to EBITDA revenue adjusted quarter, we to and to $XXX third expect million $XXX be

to Time annually, an bigger would impressions our opportunities the providing through remarks value growth. Life my increasing become by in like is number emphasizing of stronger the asset-light brand than With finish billion to I brand. XXX equity more and

this We continue well expect the future. that will into

take start Q&A, a more to strong healthier, enthusiastic lives. team like a members I the of we and passionate our to in your incredible the our team Each live would to than This has power of plays moment vital XX,XXX to thank and results people. role happier members forward looking We're seeing. questions. helping we're brand our now fuel allowed of our us extend Before

Operator

RBC Chris first Instructions] Carril is [Operator question Capital Our Markets. with from

Christopher Carril

counts expand the and more the saw going embedded that's XQ then that maybe you're forward XQ, expectations? membership in So own how and here XQ bit the the a guidance? came how your on can to And relative how in you you into thinking about in growth your that membership

Bahram Akradi

growth. our any coming they're to with happy not in. exactly trends, We're memberships expectation, weakness the Chris. of growing the that We're any very seeing the been in It's

zero guys effort have marketing, and we understand sell. zero zero you to As there is you told promotions,

has mean that much at. memberships drop, rates focus our And rates net Our with happy dropping. it's we're continuing where to attrition as the We're increase very work I attain. to in attrition makes on in easier desirability are been clubs. And our working.

Christopher Carril

what's morning. -- driving guidance driving then And the previously that and for development the from just it. I the there? Got confidence think, about ask did the want XX to increase I XX what's year specifically, in driving openings to here, update And full openings just this

Bahram Akradi

question, Yes. Chris. a great It's

is of We not our opportunities big opportunities. are the to there for systematically what are out available asset-light locations. which And our are of we asset-light almost another But nearly done those. couple about discussions. then is possible that already XX% another the asset-light XX deals. of us. XX building in about number have looking And that hundred done ones, to there's surprise, This number see We've already on XXX battleships, is

allows having able add delever they the significant should think continue to So a this years, years company we harvest to or I amounts in X and next without nice at to grow of leverage. come the continue very, company. legit are revenue the to to basically and which can be EBITDA to pace in we opportunity the X Actually, very

Operator

question John Our Securities. Guggenheim next Heinbockel is from with

John Heinbockel

piece bring So XX month, So those would you guys, I of right, the a think you then if of the handle, is last the about X about a way -- without year. is And battleships, it one, XX that's about a the being the kind let X there experience? I guess that expansion ends suburban think you me more follow on that up down harming do think that of X and cost we piece, nature, or capital-light openings the can do in last settle right? cadence right? capital-light or of than think one, to organization the the maybe that? And So Bahram, sort

Bahram Akradi

cost we're with the to starting start with of the cost get see down will of sky. instead construction starting -- the leveled the on being the some in next Actually, sort up the ground coming of feet already Yes. to off contractors in

choose giving this are what and business. what we -- to is way which to is John, do, -- pick going -- so and grow us of we we're ability to And the the sort

the then the big those we and they boxes, construction maintain we purchase launch we in a the the when growing EBITDA we sure with we easily of get permits, huge we'll just go on systematically the ready. decide focus up. the sure designs the can are deploy levels forward, right delever With EBITDA asset-light are company the revenue, it approval, are grow continuing opportunities, that levels debt at many making land, without the on to double-digit that the the if levels making as have get now didn't the the continuing we going to And to

the continue strategically, feel business. where is and And amazing start like so we bigger that delever construction on then the we we'll the have to ones. just We'll pick locations market So will demand. pent-up

John Heinbockel

that personal will you macro Okay. what about My trying where right? today, think be then if -- that? some in-center of do of will we curious in the stand And we their the assessment you know obviously, it to personal the -- think that it businesses Great. headwinds. with fine, up? COVID, anywhere? some see that build And big on your in-center I businesses we show retooled, talked And is -- where but in-center see dues from training but softness, you recovery maybe some you engagement Is of the

Bahram Akradi

I it anything with the with our Everything of don't that. in-center execution. has No, to programming. with have actually our do to control think opportunity And do execution tremendous within we has our

certain so-so the similar similar performance demographics, size similar and performance significant We some of conditions and offering. in clubs, have in we clubs, others similar have with

about the take we get creating to launching now. to to what executing places will basis. which to a on more I'm where our execute. The XXX this innovation, It within time. right before stretch, itself have going those positive dynamic really opportunity opportunity another we least locations continue training news just for significant months and is on to are -- business we this at ways gradually double-digit robustly excited there's be of couple is have growth an take So a per take personal month really another grow opportunity yet It's work to new will

each that, revenue beyond we the on that going basically X that the -- anything So volume increase we own then and will been other working that to walls the forward. asset of and have of or launch things profitability already we we've in

creating get has stood if Life you, standing tapped out if you're still. and and you're look, for that's But you're to at well going business do expecting to some So same nothing to the continue still Time never point.

to to extraordinary are quality, more looked invent gives the other and new opportunities constantly that programming us a the opportunity. elevate experience have and more higher see We to what introduce

are the had super all now all a our record on I beyond. level EBITDA where couple to different work different think margin out really last point, we years, new of the roll at And we this continue to producing from of 'XX get excited we're to the So for these transformations business. to our and levels to opportunities company just innovations, growth

Operator

from Our Nagel Brian with Company. Oppenheimer question & is next

Brian Nagel

Nice quarter. Congratulations.

-- I ratios Bahram, but X.Xx. and EBITDA Bob I for prepared parts, question, in if you questions. a of couple QX I'm down both about guidance a lot laid the and So ratio leverage couple of leverage the in your a But you talked I But first mean mentioned ask a we've the maybe ratios first the question -- have leverage given comments. correctly, implies X.Xx, the that to the doing guidance, I'll guess math for out QX, so

correctly bigger question I the you did to So to But is, sure close getting be that, how just I guess you how now to my there. are want want that make with I target at? math --

Bahram Akradi

tough, mean, the -- It's and EBITDA. for just the we at the and Yes. rough last delivered is what million look year, the first a tough, have guidance of end thumbnail, right trailing to XQ at first I months. the came XX the is the great last and trailing looking question. when $XXX plus just EBITDA Brian, XQ couple then about months XX you in of quarter you rough

goal very, this So company. doing have always And the of We had we for year. have That of goal million proud EBITDA team. very executed. was of a $XXX internal the our I'm steadily the

to on raise team steadily and the quarter. has able guidance beat been every and Our the raise we've -- executed goal,

again the EBITDA Our that, quarter, a in XX-month basis on every trailing to we're the foreseeable expectation grow obviously, is going revenue future. and

company. quickly, to or Life And really debt emphasize assets that going fee-owned what's other, EBITDA. billion rapidly in And Time under the to $X very debt so of but considered to one I is number, not at is sheet balance way want to of -- with excess of get the we're strength Xx being nice continues to the to least a this owns the that well company of EBITDA support it today the

feel about we good on for and to get getting company Thanks question, Xx, clearly we're very, the And way there. our under Brian. the so very

Brian Nagel

second the ask, center club with And question just very to That's want to the openings. the helpful. or I regard

So talked the we here. about some delays

performance I been model. causing I But as your are then of through delayed, performing very more think like has well. been? maybe, particularly I Because I'm but guess, So question These would importantly, how think the my first they've looking be the what has more new these delays? is clubs

well I specific should that So 'XX. given then for actually you for mean right? guidance haven't I bode recognize 'XX,

Bahram Akradi

Absolutely.

health have get time inspection we So initial group I we you building inspectors and launched, once can and of control. mean, health occupancy to other it's to of I we just have the of electrical the are come is give then to outside outside permit. our we want -- you we Being so able and our the get then the everything clear. their is get the start, that. be to permits within it's to and our in or there completely professional once permits, building can't end, take permits that started. the control, plumbing go. And will something get the our sometimes, have to the a control we get permit, we work, But municipalities to things through then the team

And are construction, your completely here. a situation it's some outside of really of on in nonevent and delay little those, of there's control the a just bit frankly, a

a the clubs positive. is revenue few X, months after positive X, revenue either or in X months slightly months, EBITDA first margin negative Our the contribution in X

X So or get opened after to but all the and needle back, our in nice open in the it's going If that's it on to really just but up negative, a the XX doesn't other look a X into days. fourth numbers. But we're that going hand, literally of revenue in it's bit little that. going the baked years the really you move And will in on start we're of already EBITDA. all then those to generating like -- next X, here quarter, XXXX EBITDA and generate the clubs anything,

growth that a very concern in continue deliver So increase we're have us to us, to not the and here satisfactory moving -- seeing in would we group the is anything to and we everything been that delivering forward management as looking EBITDA. that

Operator

Brian with is Harbour Morgan Our next from Stanley. question

Brian Harbour

wanted question revenue to I Yes. follow just that in-center well. on about up as

it it's on specifically? you more is kind like what time Do is just some Is takes mentioned just execute. it guys of you that of just But to or You to you these training programs? required that launch think of initiatives required? that's there Is to more some to out What specifically harvest roll it that capital of revenue? of actually drive cost have be that going is some to better those revenue? hire any that to sort will

Bahram Akradi

we It Brian. okay. performing before And personal as -- we equivalent through in well the when in but spa, question, great a actually in and It's clubs we went we had through then COVID, that well, really training, went they clubs doing cafe. have performed -- were weren't who they

category stuff, of as much we During business, everything shutdown reintroduction and personal each have COVID, isn't able and with getting not it's basically then trainers the the been just just backwards real -- is we're to with almost the to hiring, running the in those more came work. the had go casting back leaders way hiring we focused and we going on going. Where

trainers. the quality You highest have cast to absolute professional

to That's then have So innovation and It when able from next time we a and roll money significant the at to more like just therapist community growing. from massage It's are, Time good our benefits, with to to the those Life continually grab support to is for slowed opportunity going take with Life to of each placed I we more on. living stopped. told is thing. stretch. those is and like money, progress. you, to we're a going just that has the better we're we in then and It's a nice as that. all impact once. progress. to dynamic members of at good best make has work team get going -- really not happen each trainer down seeing all it have create office, make There opportunity the continuing all on It's the in. And piece income secured initiatives the It's a in to talents continued to work a from Nothing come -- a Time. That nothing is the them

seeing steadily we're to in our the in-center. growth with is going It's So but growing. -- I'm overall not a just take unsatisfied it again, not time,

Brian Harbour

Okay. makes That sense.

same you're you faster, I Some -- of thinking is of the all called the but or lean quo. this of about asset-light of think like out, opportunities it's just if shift you've largely differently if in know think that in fact, status going Or this kind the kind at grow could do sense CapEx a you these. if to may, more CapEx? you restrained quantum do this is even into if forward don't be you're going with

Bahram Akradi

growth again, with a are upfront question next as timing. able with basically, and give we it's get my I've finance in are to I million level our do it great company able goal basically you of to different just in internally that $XX EBITDA generated $X to million is locations want to to to just EBITDA form. This to the -- is personal X a a the of XXX% in to to we this is that stated repeatedly, years, where cash. And horizon there X can being grow And significantly. the continue My

sort lean sort just of to to heavy. then the can able to go million. we we're of them, on kind to leaseback the big you of once to these the million also now, $XXX a as battleships. Again, fantastic look through those get they're be build $XXX of EBITDA, the with going sale million, front to we $XXX right And get to million EBITDA heavier For then $XXX

great reduce then we'll excess that opportunity control this. the our have of the grow We news the grown are the absolutely flow EBITDA, more, we and when cash and under And narrative. balancing has take completely to grow we big can just so leverage, and all is we as significantly grow this well. The do more can battleships EBITDA revenue, of revenue we

also be going are to do We to sale just to are want clear. continue I leasebacks.

We that the asset-light company more company it's well. opportunity advantage however, we're of -- changing as strategy. the take then ones macroeconomics, bigger on, now have much And early strategy to so intention, right the later But of the chosen we from layering boxes the the based has asset-light on have just of no on.

Operator

Our next is Robbie of from Bank question Ohmes with America.

Robert Ohmes

to tailwind think could year. see you on dues you think is I are Where wanted next that think Can the half about back now, year of about the Bahram, you continued how it long year? this up to growing? is you're was can getting, the if I sort and for to the be to you average monthly of last continue how around And you're update we're membership -- how -- us going up? running keep do give of going a I much end or an versus pricing thinking benefit $XXX XX%

Bahram Akradi

have the want. As prices the that, the I've manage adjusted for covered entirely we coming we new to experience customers in

they're clubs currently, list. had So a many wait X we X clubs that have doing about that we actually so or have well on so

continue in with we're and able the in forms clubs using Now these, the we has completely taking we experiential entirely to want basically call experience price these take same will again, the the we that time, as as changes are ways the people of in experience an deliver and them we in has that through allowed to company. go still are or wait this the -- controlling a the list, but function people delivering help want. At to been the memberships the

was no new million when lower with a people month there rate, is rack rack a $XX you will difference a at So way $XX the at call look went -- rack is there everybody any thing million time changes for I'm million, on joined ever do would is price what to the rate like $XX the And because be about month. at have that who versus be If the if between suicide. that benefit member because this cover to on everybody such earlier dues, it who $XX we right? given rate, brand that would glad million, that this a

we what where of the slight a we use sophisticated increase with amount have very rate. we have systematically dues a massive complete the continually opportunity up is However, AI, supply, it doesn't of very very, or pass a big bump to know do that attrition satisfaction on

And coming of and dropping as increase see that below we with rates they so XXXX some continually though customers as we even -- seeing on going that in the dues the attrition And to numbers, also new drop the we're revenue. that, the clubs. get top of can out dues keep bumps revenue people in

We doing have dues of we now than more went $X had clubs, clubs a before COVID. we over month million through significantly more the

-- really I I things balance extremely mean, out out. wish it's like everything I right But something report working So way is with could to and try the to now. happy bad here we sit are

Robert Ohmes

That's That's then was were for center helpful. follow-up, just a really The Bob. than expense expecting quarter. maybe lower And this ops we great.

are And double -- that then something think, conversely, would on a the like Was Is think it that? stay doing going year-over-year. I Or also CapEx, thing? $XX like that lower? we How I -- seems is Does the guys was center there have thought. lower you timing than that was that maintenance million. there?

Robert Houghton

remember, part to that's To we mean, member that's just answer experience, always do will in Robby, second year out. Yes. we'll and that timing. something I and protect year the invest

that's So timing. just

a X function the about our operate. sustainable As we've relates that rewiring sustainable. made in That's of That's done. and that's a ops, it quarter, it's how company change the and I of and center that a Bahram that's previously, not talked clubs to

that going see should forward. expect you benefit So to

Operator

from Our Woronka Chris is Bank. Deutsche next with question

Chris Woronka

of it to in -- the But rank of obviously, from you markets There's you like lot evaluating existing number mean pricing get, what's you when want I can a be the to that a guess, don't margin. and -- these clubs. a maybe asset-light way, do back cannibalize sites? most I you're a I wouldn't is different get, where come of you a want to an you don't what's terms the, how question your memberships issue. order, one important can prioritize go at which more slightly time

like trying decision that understand department the here? drives not to here, to pick what Just but old store over

Bahram Akradi

it's Yes, question. great a

we want community. demographics, First, deliver locations type want Then on what be exactly and those to the the products we we in and what's of best markets, we that to deliver product studied is to the what in. decide services the best way -- strategy

And situation build the big based XX But the everything when your with or so things you of on markets, in allow XX clubs big and not acres more we -- geographical do or you XX to urban buy acres fantastic. one, with acres go all that's does roof. one boxes the land sometimes under

the or may we mean, So those locations, services of or some feet, square in some the some but it of that best-in-class total then be we product I XX,XXX our delivered we form we product, deliver with XX,XXX offer. of deliver assortment. in do in XX,XXX -- and the components

We have margin. XX% clubs Austin, Downtown a contribution like it's

square So it's -- feet. only and XX,XXX

have -- our and brands, we as as the Strike, Fit, clubs, part on go we So Alpha, we have on. just a have of it's have we Life I can and network Ultra of Time

model market. opportunity ahead go and And those feel the a represented of all be to we've of properly provide of can brands community, service in brands then business deliver will brands we -- from amazing and all the assemble these what enough we and profitable -- if have which deliver a can -- -- that of We that. just we'll that we the each like choose in got the

sometimes put and smaller big, big and opportunity that couple together. the -- the a in have between of the thing you of have maybe one then and a sews you they whole XX miles sort opportunity to So become where apart, clubs

this we've XX Time, and to Prior XX doing years. here I we So did another that been Life years we've for -- been my that, I time. about it to prior at -- for team

delivering we've So similar strategy situation depending boxes, sale can been different But lease. go and XXs change. into they're sites We're high of or IRR that and targeting with just leaseback after all always low profitability. we selecting all the and a on if sizes XXs, the types development

Chris Woronka

I Okay. that. appreciate

and about I roughly depth. a sense. trying you're positive want economists question, which reason revenue we I check. flow that to in-center know not just year XXXX in of talking So a mean know variables any wouldn't to those we have not expansion? growth. directional add however there we're think through pricing yet, bit in to a is if we're know significant, going sanity to year? mean, there still layer little up might you forecasting is Just But I any units margin reason to think I define we and of and I wanted number not add but get to all if we're next to just that we not next a that, -- ask is growth And you

Bahram Akradi

Yes.

we piece about So on look, let's question, the margin. your -- as last of talk

see. XX% to of is ahead right I XX%, level the the and yes. low But out put really what now that end get margin we the The as -- you EBITDA can Can that could is answer or I XX.X% So just you on go grow? to bit on lower the that XX.X%. pressure little or a on clubs it how that depends can the the will end same put of put and quarter a all of a time negative and months, of X that -- in XX%, end at that, many high open,

contribution contribution margin negative positive, And it margin and go so to as you. then ramp can clubs from those push

we believe I -- we we're top don't into the I to company going double of I at forward. And far commitment and and of don't -- as has number delivering we our the a confident a ahead making guidance range. to company that's we bottom been But then committed double-digit that have want line, will get growing with pretty lot So digits And margins tough, my are just in us, opportunities point, as rough grow of concern the deliver I of can just sort this expectation any goal. growth, and those for XXXX. a

Operator

is Our Politzer Dan with next from Fargo. Wells question

Daniel Politzer

year. color you wanted this get I point. the leasebacks of wanted $XXX of sale terms the to thus million in that any sure I terms on follow -- higher proceeds the ago? are and you timing, X all -- for the in Thanks year tone far make on you up done update terms this conversations? how of to is of year. this at And or total that guys in receive months just obviously, And now that million the And these the about I lot far. maybe progressed would the we're extent conversations wanted in -- even that yes, half you back versus the of reiterated rates how you'll if X have along to How risk-rewards a the think to $XXX are? of there's

Bahram Akradi

Great set a question, forward goal. to what still as have we with expecting Dan. I am go forward fully

market. then methodically. $XXX My to working been range trailing million of goal XX this EBITDA company has of get attack We the kind that been have and very to months

days They for I those. years to done. us have years. to and It's getting you calls the to I've concerns in we're getting on through working no about but that I guys just I've done, terms As of will been that get of update still with XX give an leasebacks mentioned get and how next you sale market years repeatedly, were inbound go guys that going done. getting to them planning those we're a rate. matter in And

Daniel Politzer

my Got follow-up. it. And for just then

as bit, to little in-center think take a the quarter guidance, of these higher any as Or just just little new center there of you're to in In you be is conservatism other open that's guess, a terms it variables was on? fourth of but sure I extent is it these pressured sounds the a going the you've the new were ramp-up or bunch I centers touched recessionary It that think reflecting revenues to centers that come on like fourth make going you onset? open new as quarter, to in that want contribution that third clear. the implied like bit a margin But I I the I at right? have centers you in OpEx, just quarter,

Bahram Akradi

everything is -- Dan. Everything that you mentioned you're correct, -- you exactly

a delayed openings, as the little been club new a have mentioned, here. few, quite some So bit I there's

opening open on contribution they're month of with now. got month They're a And a going take, And going or margin margin to then next month, are opening flip a openings. positive. to X We after. So again, all a early they X clubs or depending the on. those negative it's lot before location, contribution

have we consideration. So that taken into

our to have, on in-centers We XX%, macroeconomics, locations, baked are going the to those continue executing than we conservatism to in-center, standards of they at have strategy cafe, the mentioned, finally, come XX%. -- some a in our to for spa, get more the our right? And as -- we as execute all lower many margin

customer, providing but So services grow they those margin. want that's and more a those for to Athletic come. the more generate Life They Time. we country come they lower revenue at but do still of because EBITDA, differentiation club the

taken what are covered, are all you those for we're that of So giving of just consideration into all you. guidance those exactly

Operator

is question next Siegel with BMO Our Capital Markets. from Simeon

Simeon Siegel

different. centers Recognize so these recognizing little a --

you're how that you higher Bahram, to traffic Bob, any you revenue members the full average, the have update third per growing number I quarter you And could other the speak the about of new talking been learnings embedded then, memberships price year right to presence the areas, cities. center? Manhattan, and you the about just Just of within thinking And have and versus from guidance? the like and speak maybe could then some

Bahram Akradi

Okay.

go through at questions a time. those Let's one

again. First question

Robert Houghton

Yes.

center. per memberships Just

Bahram Akradi

Okay.

now ones of feet we square XX,XXX some feet. literally XX,XXX, from square XXX,XXX urban the clubs So Simeon, we with -- to have

to variety of maturity, we So guys I a in number based need membership of for sort you a on I get of think membership think don't number perspective that opening market. you we with know a with of average. of of of just But number can is I that different looking right we help per don't memberships the I up that divide an just what can we're center is number offer help maybe clubs are what pricing And center. going take basically, can offer we the that a the anybody anything. a as membership a to I it's clubs, and giving you in try it not by have, to memberships the know per

we how So the mean to know the I variety because frankly, offer. I don't answer creating of the that of more confusion, out. without to products there's nothing vastness that average

question? second The

Robert Houghton

Learning in like Manhattan. clubs high-traffic opening areas from

Bahram Akradi

Yes.

getting teams list we in Life [indiscernible] clubs up the is get to are our and lift will are what getting So of allowing brand a we're before we processing our pretty the about are is group, exceed right opening because more We're approaches seeing that dues that things. now, have it. for wait short -- wait -- Time we established are of open much bigger XX And days we how list terms then to it's steadily the pool much, a have so we a able desired Simeon, presales club and hit goal They're only efficient. there. right now,

are margin contribution margin So ever faster more than ever positive than clubs reaching -- contribution before. faster

So the services the is places Time keep we're continue to looking for and doing, people. to grow and do on products brand opportunistic to Life learning deliver what keep to and the pressing

Robert Houghton

membership I'll And the then Simeon, growth. versus last on one take price

'XX, we If pandemic. membership XXXX at that year. saw XXXX this clubs and clubs from we to saw opening the opened look membership We or the were in you quarter, growth in growth clubs prior to saw second open

pricing that take, that additional taken, mentioned our already member So is we've clubs already when we've of regardless sort that they we first to all very opened. we complete. price see, broad-based pricing Any across earlier, that due to would protect pricing Bahram what got it's membership really The were action done benefit is only growth of experience.

Operator

Our next question with from Mizuho is John Securities. Baumgartner

John Baumgartner

wanted addressing whether When facilities just new it's When you the these services gaining think couples, sensitivity, experience you applying AI. Bahram, to sort these learnings question. willingness the at families, about new and demographics, up you're singles, rack look Simeon's overcrowded the and to of with up, pricing pay follow rates on you're picking or terms of getting sign what's you're don't months, new this up. as over deal guess the data? you seals offering dig been XX most new that that I the and the or you to you've that know, into member, the XX in learnings amenities of that past, I sort you new surprising get

Bahram Akradi

interested any $XXX. Well, what we is zero just doesn't membership just experience, that's -- cannot insensitive being or pretty growth. that customer or to the impact are $XXX -- seeing is learning. -- It's we that $XXX the in there are They effect, the see they the the price the it units,

done. XXX% to the have either be deliver what XXX% Life you committed brand that's And want. You committed to be has experience you to or to that metrics need Time

to refuses what's basically last Time And this our are and state just is member they're see customer Life that moved go from up. Time." live appreciative back, is the when I learning Time. was Life the I house to is talking daughter brand-new my to a to close that Life is not and hi, about another one, buying "Hey, to somewhere people they close so working opening So night, X one a passionate

the all us all leverage, on just than to narrative we worked, And ever we brand had. the the need giving our the more experience. around to it's muscle has opportunities what more we've So We're focus now. control right that's locations, customer getting power, for our continue are all going amazing

to The you continue the to is execute And so that's can't going be learning learning. on we're that. But wishy-washy.

been -- a control experience efficiencies, cost coming efficiencies, try cost record. I like amount People emphasize, can't about there's a the at time. And back. and of go the lot to broken of conscious narrative read that same of cost cost the just a stuff conscious I cost You tremendous efficiencies, I have

the decisions. And make more decisions to We responsive be can focused faster, we our serve our like coming for cost more business lead there We literally from so the have structural ease they focus more on robustly if and cost better can on rewired not rewired so to customers company that zero with generals control. is term, make long zero. efficiency that control, is

And the the delivering to customer. for instruction expectation -- that. how you're succinct what and more the the company see is brand inspections never results every well experience inspections, the every That's of the club, aligned delivering the XXX% homogeneously all focus are working Our right and maximum on has we on lead been general. we That's quality for the want. and of

John Baumgartner

big are drugs want picture I these to weight just ask new about then loss market. And the that hitting

are your individuals active market about complementing it, the for you opportunities a some some who for them can target different be new thought But integrate basis about time? towards unlock extent the first outreach there. do folks You Does the the older skews and that for doing like base than pharma think it pharma. may you of membership more you're for with to of folks these active how membership for business? Your with out ARORA

curious morning, macro I the the the think personal pharma of you you that impact apply. I'm this could mentioned about from how programs, side? the the some think business training, potential stretch on

Bahram Akradi

think a names, that -- I if and pills reality will -- mean are were don't particular would lose I people The it take question. density. is lose you I weight. that your -- to us any of appetite eventual maybe and impact great bone a That's lose because eventual is suppresses we taking fitness it purely a that then of that won't and of mention pill muscle whenever eat, company, you

people, actually people together. -- up It's For reasons. clubs lesson it's business. I have of it's people in health. -- is I them are very, not they take really the detriment the social of to is are very learn sign group not have else classes community everything they social someone to social come those and the aspect, -- aspect, mean, their This us there country focused -- are it again, weight start a but then impact all case. off a stuff. become, large -- a weight seeing because doing the that emphasize been is someone is get network broad our difference for The gathering is absolutely long-term people to or with And our club, it's weight and a these of for go, our will that, just It's very, joining and beach to on we will an like club lose jump to joining fewer factor. them will things. their people loss, But bunch always other small we're get for to amazing stay give okay these it, on

lose this definitely hopefully, So it. I drug case. not they're taking this because but person didn't not you, to Life are about answered god, No, we're correctly concerned the not my that to join weight, we us That's oh, particular seeing, for they're Time. coming

Operator

over the like have I would of back for We session. the conference end closing comments. turn Bahram to to question-and-answer reached our

Bahram Akradi

And No, great we're you all see forward guys, between quarter. appreciative the or questions, everybody to continue. in looking and just hopefully, next

Operator

Thank you. This will conclude today's conference.

and You you for this may participation. your thank time, at your disconnect lines

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