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Life Fitness Sales Down, Earnings Up

LAKE FOREST, IL -- The fitness segment of Brunswick Corp., which consists of the Life Fitness Division, had a decline in sales but an increase in earnings in third quarter 2009.

According to financial results released Thursday, the Life Fitness Division, which manufactures and sells Life Fitness and Hammer Strength fitness equipment, had sales that totaled $126.8 million in the third quarter, down 22 percent from $161.6 million during third quarter 2008. International sales, which represented 55 percent of total segment sales in the quarter, declined by 15 percent.

Commercial equipment sales, which account for the largest percentage of the fitness segment sales, declined as club operators remained cautious about ordering equipment, the company said. Sales of consumer exercise equipment also were down, though at lower rates than sales of commercial equipment, the company added.

Brunswick’s fitness segment also reported operating earnings of $12.5 million, including $0.4 million of restructuring charges. In third quarter 2008, the fitness segment had operating earnings of $10.3 million, including restructuring charges of $0.8 million. The higher operating earnings in third quarter 2009 compared to the previous period of a year ago, the company said, reflect actions taken by Life Fitness to reduce expenses, which were partially offset by the effect of lower sales.

As a company, Brunswick Corp. reported total sales of $665.8 million in third quarter 2009, down 36 percent from the $1.04 billion it reported in third quarter 2008. The primary reason for that decline, the company said, was its marine sales dropped by 40 percent from year-ago levels. The company also had a net loss of $114.3 million in the quarter compared to the net loss of $729.1 million in third quarter 2008. Cash totaled $624.1 million, up from the 2008 year-end balance of $317.5 million.

“We continue to make great strides in improving our overall liquidity position, reducing our marine dealer pipeline and executing our cost reduction program,” Brunswick Chairman and CEO Dustan E. McCoy said in a statement. “These significant accomplishments have been achieved against a global marine market that has experienced its lowest level of demand in more than 45 years.”

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