Fitness financials: Town Sports 4Q profit up, revenue flat; plus Wal-Mart earnings

Town Sports 4Q profit up, revenue flat

Town Sports International Holdings Inc. (NASDAQ: CLUB) swung to a profit for the fourth quarter 2010 on lower operating costs, but slightly lower revenue.

The New York-based owner and operator of health clubs in the Northeast and Mid-Atlantic reported a net income of $1.3 million, or $0.06 per share, for the fourth quarter, ending Dec. 31, 2010, compared to a net loss of $7.3 million, or $(0.33) per share during the same period a year ago.

A 14-percent drop in operating costs helped Town Sports reverse last year’s fourth-quarter loss, which included $12.3 million in impairment charges a year ago.

Fourth-quarter 2010 revenue at Town Sports was essentially flat – falling less than a percentage point to $114 million, compared to $114.3 million during the fourth quarter 2009. Comparable club revenue in the fourth quarter decreased 1.7 percent from a year ago.

“We ended the year with some positive momentum in the business for the first time in more than two years, including improvements in our comparable club revenue comparison, as well as our personal training and membership trends,” Town Sports CEO Robert Giardina said in a statement. “Our balance sheet has also improved from a year ago, and we believe our approach to the business is on track. We have a great team in place to execute our strategies.”

Full-year 2010 revenue at Town Sports came in at $462.4 million – down 4.7 percent from 2009, while comparable club revenue 4.3 percent during for the year. The company reported a net loss of $259,000, or $(0.01) per share in 2010, compared to net loss of nearly $5.7 million, or $(0.25) per share in 2009.

Total member count at Town Sports increased 1.4 percent to 493,000 at December 31, 2010, compared to December 31, 2009.

Looking ahead to the first quarter 2011, company officials project slightly lower revenue between $115.5 million and $116.5 million versus $117.8 million for the first quarter 2010. They expect net income between breakeven and $500,000, and earnings per share to be in the range of $0.00 per share to $0.02 per share.

The company expects to spend up to $10 million more in capital expenditures in early 2011, mostly related to two planned club openings in the second half of 2011.

Town Sports operates under the brand names of New York Sports Clubs, Boston Sports Clubs, Washington Sports Clubs and Philadelphia Sports Clubs.

Wal-Mart 4Q revenue, profit up

Wal-Mart Stores Inc. (NYSE: WMT) reported higher revenue and profit for its fiscal 2011 fourth quarter, ending Jan. 31, 2011.

The company reported quarterly revenue of $115.6 billion – up 2.5 percent from the same period a year ago. Wal-Mart’s quarterly income from continuing operations rose to $5 billion, compared to $4.8 billion a year ago.

For its full fiscal 2011 year, Wal-Mart reported revenue of $419 billion – up 3.4 percent from a year ago. Income from continuing operations rose to $15.4 billion, up from $14.4 billion last year.

Walmart’s revenue included a $664 million and a $4.5 billion currency exchange rate benefit for the quarter and fiscal year ended Jan. 31, 2011, respectively. The highest increases in revenue came from Brazil, Mexico, and China, the company said.

Revenue for Sam’s Club, excluding fuel, increased to $11.9 billion, an increase of 2.5 percent from last year’s fourth-quarter results. On the full year, net sales, excluding fuel, grew by 1.4 percent at Sam’s Club.

— Compiled by David Clucas

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