Life Fitness Revenue Improves

SCHILLER PARK, IL -- The Life Fitness Division of Brunswick Corp. had a slight increase in first quarter 2010 revenue, according to financials released today by Brunswick, Lake Forest, IL. The Life Fitness Division manufactures and sells Life Fitness and Hammer Strength fitness equipment.

Fitness segment sales in the first quarter of 2010 totaled $119.0 million, up slightly from $118.6 million in the year-ago quarter. International sales, which represented 52 percent of total segment sales in the quarter, increased by 15 percent. For the quarter, the fitness segment reported operating earnings of $9.5 million. This compares with operating earnings of $0.3 million in the first quarter of 2009, which included restructuring charges of $1 million.

Commercial and consumer equipment sales were flat during the quarter. Higher operating earnings in the first quarter of 2010, when compared with 2009, reflect the favorable effect of lower material and freight costs and other cost efficiencies, according to the company. In particular, steel costs were lower in first quarter 2010 compared to first quarter 2009, Dustan McCoy, CEO of Brunswick, said in a conference call with analysts today.

Overall, Brunswick experienced an increase in its net sales. The company, whose largest division is its Marine Division, had net sales of $844.4 million, up 15 percent from the same period in 2009. Brunswick had a first quarter net loss of $13 million, which included restructuring and impairment charges and special tax items. Operating earnings for Brunswick was $10.1 million, a $137.6 million improvement from the previous year.

Also on the call was Peter Hamilton, Brunswick senior vice president and chief financial officer. Hamilton temporarily is taking on the role of Life Fitness president until a replacement for John Stransky, the company’s former president, is found. Stransky left the company earlier this month. Brunswick has said it is looking for a replacement internally and externally. Hamilton had been Life Fitness’ president from 2005 to 2006.

During the call, McCoy thanked Hamilton for taking on the added responsibility and work.

“I want to thank Peter for working two full-time jobs,” McCoy said. “Up until about a month ago, he was only the CFO, which, the best I can tell, was a 60-hour week. Now, he’s taking care of Life Fitness for us on an interim basis, which is another 60-hour week. He seems to holding up well.”

As of 4:30 p.m. ET today, the company’s stock had risen to $22.69. It had started the day at $18.27. The 52-week high was $19.70.

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