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TSI Reports Growth in 2007

NEW YORK -- Town Sports International (TSI) reported a 7.9 percent increase in revenue in the fourth quarter of last year and a 9.2 percent revenue growth for the year, according to a statement the company released Thursday. Fourth quarter 2007 revenue was $118.9 million, up from $110.2 million during the same period in 2006. Revenue for the year was $472.9 million, up from $433.1 million in 2006.

Although net income declined from $6.6 million in the fourth quarter of 2006 to $6 million in the fourth quarter of last year, overall net income increased from $4.6 million in 2006 to $13.6 million last year.

“We are very pleased to report positive results for the fourth quarter and full year and that our strong position in the market and our current business trends are providing us with a favorable outlook despite the current economic conditions,” TSI CEO Alex Alimanestianu said in the statement. “Our team executed nine new club openings in the fourth quarter, and our new clubs continue to perform well. In 2008, we will look to capitalize on strengths such as our corporate and group sales programs, which leverage our clustering strategy, and will continue to look for ways to improve our execution at the club level.”

Membership revenue increased from $91.765 million in the fourth quarter of 2006 to $99.228 million in the fourth quarter of last year. Overall, membership revenue increased 8.8 percent, from $355.764 million in 2006 to $386.946 million last year.

TSI estimates that revenue in 2008 will be in the range of $510 million to $520 million, representing a growth of 8 percent to 10 percent, the company said in the statement. The growth will be driven primarily by club membership and ancillary revenue growth, and the maturation of recently opened clubs as well as new clubs expected to be opened in 2008, according to the statement.

TSI is a publicly traded health club company doing business under the brand names New York Sports Clubs, Boston Sports Clubs, Washington Sports Clubs and Philadelphia Sports Clubs.

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