Town Sports International Holdings Inc. (TSI), Jupiter, Florida, reported second quarter 2019 revenue of $118.70 million, according to financials released by the company on July 25. This marks a 5.6 percent increase over last year's second quarter earnings of $112.33 million.
These results represent two years—or eight consecutive quarters—of positive growth for a company that had previously experienced five straight years of revenue decline.
TSI also reported another quarter of growing operating expenses and declining adjusted EBITDA. Respectively, these categories grew by 8 percent ($117.32 million) and decreased by 13 percent ($11.98 million), respectively.
These figures, when juxtaposed, may be harbingers of long-term struggle for TSI, one anonymous industry insider told Club Industry in April. The average health club company should see EBITDA margins grow by at least 15 percent every year, the insider said.
In April, TSI CEO Patrick Walsh addressed the company’s stock prices and its recent acquisitions in a letter to shareholders.
“Town’s stock has been volatile over the past year, and it is important to remember that good companies are not always good stocks and good stocks are not always good companies,” Walsh said in his letter. “[T]he benefit of hindsight will be required to truly judge the performance and merits of these deals,” Walsh said. “We look forward to reporting our progress in the years ahead.”
TSI operates health clubs under the names New York Sports Clubs, Philadelphia Sports Clubs, Boston Sports Clubs and Washington Sports Clubs.
In July 2017, TSI announced the company will no longer host conference calls to discuss quarterly results.
TSI ranked No. 7 on Club Industry’s Top 100 Health Clubs of 2018 list, reporting $403 million in 2017 revenue.