Planet Fitness, Newington, New Hampshire, filed an initial public offering on Monday.
The company, which was founded in 1992, will sell its Class A common stock to be traded on the New York Stock Exchange under the symbol PLNT, according to its Form S-1 filed with the Securities and Exchange Commission (SEC). (For highlighted data from the filing, check out this gallery.) The company estimates the shares will generate $100 million in revenue for the company.
The company called itself an "emerging growth company" because it has under $1 billion in annual revenue. As such, management has "elected to comply with certain reduced public company reporting requirement for this prospectus and future filings," the form noted.
An emerging growth company is a new category that was created as part of the Jumpstart Our Business Startups (JOBS) Act of 2012. Companies qualify for this status if they have less than $1 billion in annual gross revenues during its most recent fiscal year. According to Practical Law, the company can continue to call itself an emerging growth company until the earliest of one of the following:
- "The end of the fiscal year in which its annual revenues exceed $1 billion.
- The end of the fiscal year in which the fifth anniversary of its IPO occurred. For example, if a company with a December 31 fiscal year-end completed its IPO on May 2, 2012, it would cease to be an emerging growth company by December 31, 2017.
- The date on which the company has, during the previous three-year period, issued more than $1 billion in non-convertible debt.
- The date on which the company qualifies as a large accelerated filer."
The JOBS Act permits an emerging growth company to take an extended transition period to comply with new or revised accounting standards applicable to public companies, but Planet Fitness said in its filing that they are opting out of this provision.
The filing states: "As a result, we will comply with new or revised accounting standards as required for public companies that are not emerging growth companies. This decision to opt out of the extended transition period under the JOBS Act is irrevocable."
However, the company did note in the filing that it may take advantage of other reduced disclosure and requirements for emerging companies, including reduced disclosure of executive compensation arrangements, no non-binding shareholder advisory votes on executive compensation or golden parachute arrangements and exemption from the auditor attestation requirement of the company's internal control over financial reporting.
The company reported that it had $76.9 million in first quarter 2015 revenue. That revenue was from three segments: franchise at $21.8 million, equipment at $31.6 million and company-owned clubs at $23.5 million. It also report that it had 7.1 million members at the end of the first quarter.
Same-store sales growth in the first quarter was 10.9 percent overall. For franchisee-owned clubs, same-store sales was 11.7 percent while corporate-owned stores came in at 4.6 percent.
Planet Fitness ranked No. 7 on Club Industry's Top 100 Clubs list in 2014 with a reported $211 million in 2013 revenue, a 32 percent increase from 2012. That revenue included company-owned stores and franchisee fees only.
At the end of first quarter 2015, the SEC filing shows that the company had 919 franchisee-owned clubs and 57 corporate-owned clubs. Earlier this month, Planet Fitness opened its 1,000th club.
Planet Fitness is awaiting a decision from the New Hampshire legislature on a request to change the a provision in the state's business profits tax. The bill appears headed for a House and Senate votes. If passed, would need to be signed by Governor Maggie Hassan to become law July 1.
Planet Fitness has threatened to move its Newington-based headquarters out of state if the provision is not changed.
In 2011, the company's owners initially considered going public but chose not to at that time. Rumors that the owners were again considering filing an IPO surfaced in February with a Reuters report. Then, in late May, the company filed a draft registration statement with the SEC.
Planet Fitness' move to go public comes in the same month as Life Time Fitness completed its sale and once again went private.