Life Time Group Holdings, Inc.

Greetings. Welcome to the Lifetime Group Holdings third quarter 2023 earnings conference call. At this time, all participants are in a listen-only mode. A question and answer session will follow the formal presentation. If anyone should require operator assistance during the call, please press star zero on your telephone keypad. As a reminder, this conference is being recorded. At this time, I would like to hand the call over to Ken Cooper of Investor Relations. Thank you. You may begin.

Good morning and thank you for joining us for the Lifetime Third Quarter of 2023 Earnings Conference Call. With me today are Bram Akrati, Founder, Chairman, and CEO, and Bob Houghton, CFO. During this call, the company will make forward-looking statements which involve a number of risks and uncertainties that may cause actual results to differ materially from those forward-looking statements made today. There is a comprehensive discussion of risk factors in the company's SEC filings which you are encouraged to review. The company will discuss certain non-GAAP financial measures, including adjusted net income, adjusted EBITDA, adjusted diluted EPS, net debt to adjusted EBITDA, or what we refer to as our net debt leverage ratio, and free cash flow. This information, along with reconciliations to the most directly comparable GAAP measures, are included in the company's earnings release issued this morning, are 8K filed with the SEC, and on the investor relations section of our website. I'm now pleased to turn the call over to Bob Houghton. Bob?

Thank you, Ken, and good morning, everyone. I'll walk you through some of our third quarter key highlights and metrics. Our revenue increased 18% to $585 million. The revenue in the quarter would have been approximately $2 million higher if not for the delay in opening our Tampa Harbor Island takeover location. Also, our third quarter results last year included approximately $3 million in revenue related to two non-profitable triathlons that we sold earlier this year. The combined impact of these two items is about $5 million of revenue. Our adjusted EBITDA increased 101% to $143 million in the quarter, compared to $71 million in the prior year quarter. Adjusted EBITDA margin increased by 10.1 percentage points to 24.4% versus 14.3% in the third quarter of 2022. Year-to-date revenue increased 23% to $1.66 billion. Year-to-date adjusted EBITDA increased 128% to $399 million compared to $175 million in the prior year-to-date period. Center memberships ended the quarter at approximately $784,000, an increase of roughly $56,000, or 8%, compared to the prior year quarter. Total subscriptions ended the quarter at approximately $830,000. Average center revenue per membership increased to $722, an increase of 9% from $660 in the prior year quarter. Adjusted net income was $26.7 million, compared to an $11.5 million adjusted net loss in the prior year quarter. Year-to-date adjusted net income was $91 million compared to an adjusted net loss of $67 million in the prior year period. Adjusted diluted EPS was 13 cents compared to a loss of 6 cents per share in the prior year quarter. Year-to-date adjusted diluted EPS was 45 cents versus a loss of 35 cents per share in the prior year period. Importantly, our net cash provided by operating activities was $115 million compared to $45 million in the prior year quarter, and year-to-date net cash provided by operating activities was $331 million compared to $125 million in the prior year-to-date period. We are very proud that we have been able to reduce our net debt to adjusted EBITDA to 3.7 times by the end of the quarter, compared to 4.2 times at the end of Q2 2023 and 7.6 times at the end of Q3 2022. I will now turn the call over to Buram.