The International Health, Racquet and Sportsclub Association (IHRSA) announced today the release of the IHRSA 2009 Second Quarter Index results, which demonstrates the financial performance of a sample of the commercial health club industry. The survey of 18 leading U.S. health and sports club companies, representing a total of 632 facilities, determined that a majority of participating clubs reported improved performance over the first six months of 2009. However, performance faltered in the quarter ending June 30, 2009 compared to the quarter ending June 30, 2008.
For the quarter ending June 30, 2009, participating clubs in IHRSAâ€™s Index reported increases in three key performance metrics when compared to the quarter ending March 30, 2009. Total revenue increased by 0.2 percent, non-dues revenues improved by 2.8 percent, and EBITDAR soared by 7.0 percent. Total membership/dues revenue dropped slightly by 1.7 percent. Additionally, EBITDAR as a percent of total revenue improved. In the second quarter of 2009, EBITDAR was 30.7 percent of total revenue, while first-quarter 2009 EBITDAR was 26.0 percent of total revenue. â€œImprovements in these metrics signify that club operators are marketing and profiting from non-dues services as well as employing cost management strategies in the short term,â€ reported Katie Rollauer, IHRSAâ€™s Senior Manager of Research.
However, when results from quarter end June 30, 2009, are compared to quarter end June 30, 2008, the IHRSA Index indicated decreases in total revenue, membership dues/revenue, and non-dues revenue. Declines have been under double-digits with total revenue having dropped by 5.2 percent, total membership/dues revenue down by 5.3 percent, and non-dues revenue decreasing by 3.5 percent. These decreases in club profit centers could reflect the national drop in GDP by 1.0 percent in the second quarter, as consumers have limited their discretionary spending over the past year.
IHRSAâ€™s Quarterly Index also reported a drop of 8.1 percent in EBITDAR for the quarter ending June 30, 2009 compared to same quarter ending June 30, 2008. â€œIt is evident that further cost cutting may be necessary for clubs to improve EBITDAR relative to 2008,â€ said Rollauer.
Survey Results for the quarter ending June 30, 2009 compared to results from the quarter ending June 30, 2008:
|Mean||Median||Percent Change (Mean)||Company Percent Change (Median)|
|Total Revenue||$29 million||$7.2 million||4.1%||-5.2%|
|Total Membership/Dues Revenue||$21 million||$4.6 million||5.1%||-5.3%|
|Total Non-dues Revenue||$7.8 million||$2.3 million||2.2%||-3.5%|
|EBITDAR||$8.7 million||$2.1 million||0.6%||-8.1%|
Note: Data reflects information for 18 leading U.S. health and sport club companies representing 632 facilities. Same-store revenue data reflects clubs that have been in operation for at least two years. Participating companies reported owning/managing an average of 35 facilities (same-store count average of 12 facilities). Data is intended to provide a snapshot of U.S. health club industry performance, however the results are based on a small sample of companies and care should be taken when making comparisons of these findings to the overall industry-at-large. Industry Insights, Inc conducted the survey for IHRSA.
EBITDAR: Earnings before interest, taxes, depreciation, amortization and rent.
The "% Change" reflects the percentage change from one quarter to the next in the groupâ€™s overall mean/average for each variable, and is essentially weighted by the size of companies responding to the survey. As such, the â€œ% Changeâ€ presents an indication of the broader groupâ€™s performance. The "Co. % Change" reflects the median/midpoint percentage change reported by the 18 individual companies. As such, the â€œCo. % Changeâ€ represents the â€œtypicalâ€ companyâ€™s performance where all the participants are weighted equally, regardless of size.
For more information on IHRSA research, please visit www.ihrsa.org/research.
The International Health, Racquet & Sportsclub Association (IHRSA) is a not-for-profit trade association representing health and fitness facilities, gyms, spas, sports clubs, and suppliers worldwide. The associationâ€™s membership includes over 9,750 clubs in 78 countries, along with over 740 industry suppliers.