IHRSA Index Shows Steady Performance in Second Quarter


BOSTON -- Commercial health club financial performance improved for second quarter 2008, relative to the same period last year, according to the International Health, Racquet and Sportsclub Association (IHRSA) Q2 Index, which was released last week. Results for the third and fourth quarters won’t be available for several months. The survey of U.S. health club companies, conducted by Industry Insights Inc., demonstrates the financial performance of health clubs during the second quarter, according to IHRSA. The survey was of 17 small- to mid-size clubs, representing 194 facilities, or an average of 11 clubs per company.

The IHRSA index shows that a health club company grew its total revenue by an average of 14 percent from $16.8 million in the second quarter of 2007 to $19.1 million in the second quarter of 2008. Average membership dues also increased for a company by an average of 12.6 percent from $11.6 million to $13.1 million.

"The steady performance demonstrated by leading health clubs reflects the industry’s potential to maintain growth during challenging economic times,” says Katie Rollauer, IHRSA’s senior manager of research.

Index companies have also demonstrated the capacity to tap into alternate offerings to membership as clubs reported a median increase of 13.3 percent in non-dues revenue over the same period in 2007. Club companies who continue to improve on non-dues revenue are better positioned to withstand the current economic climate.

On a per club basis, index companies have remained steady in financial performance, with individual clubs reporting revenue numbers similar to the second quarter of 2007. Total median revenue for the period increased by a statistically insignificant 1 percent from $1.67 million to $1.69 million. Clubs reported total membership revenue of $1.07 million, a figure comparable to earnings in the second quarter of 2007 at $1.06 million.

IHRSA notes that the 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.

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