CHANHASSEN, Minn. - Life Time Group Holdings, Inc. (NYSE: LTH), a prominent operator of athletic country clubs, announced preliminary financial results for the third quarter ending September 30, 2024, revealing significant growth. The company reported an 18.5% increase in total revenue to $693.2 million compared to the same period last year. Net income saw an extraordinary rise of 422.5% to $41.4 million, and adjusted net income also surged by 110.9% to $56.3 million.
The company's adjusted EBITDA climbed by 26.1% to $180.3 million. These robust financial metrics come alongside a reduced net debt leverage ratio, now at an estimated 2.4 times, down from 3.7x the previous year. Life Time also expects to report positive free cash flow for the second consecutive quarter before accounting for sale-leaseback transactions.
Erik Weaver, Executive Vice President and Chief Financial Officer of Life Time, expressed satisfaction with the company's performance, highlighting strong revenue growth and a fortified balance sheet. The full financial results are scheduled to be released on October 24, 2024.
Life Time's cash flow highlights include a 31.8% increase in net cash provided by operating activities, reaching $151.1 million. The company's free cash flow is estimated at $138.3 million, which includes $65 million from sale-leaseback transactions on two properties.
The company's liquidity and capital resources were also solid, with total available liquidity standing at $529.8 million, including its $650 million revolving credit facility and cash on hand.
Life Time operates more than 175 athletic country clubs across the United States and Canada and offers a variety of healthy lifestyle programs. The company's growth is further supported by a workforce of over 41,000 professionals.
The preliminary financial results are based on current information and are subject to change following a final review by management and independent auditors. The company cautions that the figures should not be considered a substitute for full financial statements prepared in accordance with U.S. GAAP.
Investors are advised that this financial summary is based on a press release statement and that the preliminary estimated financial results do not guarantee final figures for the period.
In other recent news, Life Time Group Holdings Inc (NYSE:LTH). has experienced a series of significant developments. BofA Securities has raised its price target for the company to $30.00, citing the successful expansion of Life Time's pickleball offerings as a key driver of increased membership demand. The firm's analysis projects an adjusted EBITDA of $705 million for Life Time by 2025.
In the second quarter of 2024, Life Time reported a 19% increase in total revenue, reaching $668 million. Active memberships also grew by 5%, and the company's net income for the quarter was reported at $53 million. Based on these strong results, Life Time has revised its full-year revenue guidance to between $2.56 billion and $2.59 billion, and adjusted EBITDA guidance for the year is now set in the range of $642 million to $652 million.
The company also announced plans to launch a public offering of 12 million shares of common stock, with the aim of using the net proceeds for general corporate purposes, potentially including debt repayment. Morgan Stanley and BofA Securities are the lead active book-running managers for this offering. These are among the recent developments for Life Time Group Holdings.
InvestingPro Insights
Life Time Group Holdings' impressive preliminary Q3 2024 results are further supported by key metrics and insights from InvestingPro. The company's revenue growth of 18.5% aligns closely with InvestingPro data showing a 17.97% revenue growth over the last twelve months as of Q2 2024. This consistent growth trajectory underscores Life Time's strong market position in the athletic country club sector.
InvestingPro Tips highlight that Life Time is trading near its 52-week high, with a significant 77.89% price return over the past six months. This surge in stock price reflects investor confidence in the company's growth strategy and improved financial performance.
The company's profitability is also noteworthy. An InvestingPro Tip indicates that analysts predict Life Time will be profitable this year, which is consistent with the reported 422.5% increase in net income for Q3. Additionally, the company's P/E ratio of 44.83 suggests that investors are willing to pay a premium for Life Time's growth potential.
It's worth noting that InvestingPro offers 13 additional tips for Life Time Group Holdings, providing investors with a more comprehensive analysis of the company's financial health and market position. These insights can be particularly valuable for those looking to make informed investment decisions in the dynamic fitness industry.
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