Town Sports International Holdings, Inc. (CLUB) saw its loss narrow to $5.51 million, or $0.21 a share for the quarter ended Sep. 30, 2016. In the previous year period, the company reported a loss of $22.01 million, or $0.89 a share.
Revenue during the quarter dropped 5.04 percent to $98.53 million from $103.76 million in the previous year period. Operating margin for the quarter stood at negative 2.66 percent as compared to a negative 19 percent for the previous year period.
Operating loss for the quarter was $2.62 million, compared with an operating loss of $19.71 million in the previous year period.
However, the adjusted EBITDA for the quarter stood at $11.04 million compared with $6.55 million in the prior year period. At the same time, adjusted EBITDA margin improved 489 basis points in the quarter to 11.20 percent from 6.31 percent in the last year period.
Patrick Walsh, Chairman and Chief Executive Officer of TSI, commented: "The turnaround in Town Sports’ operations has led to a material improvement in the Company's profitability. During the third quarter, Adjusted EBITDA increased 68.5% from the prior year to $11 million. We continue to focus on improving the member experience through club remodels which include new, state of the art equipment, specialized programming and an updated visual aesthetic. In addition, we recently launched new digital tools which include an enhanced and more user-friendly web site and TSI’s first ever mobile member app, which will allow members to personalize their club experience."
Working capital turns negative
Working capital of Town Sports International Holdings, Inc. has turned negative to $10.75 million on Sep. 30, 2016 from positive $35.70 million on Sep. 30, 2015. Current ratio was at 0.85 as on Sep. 30, 2016, down from 1.44 on Sep. 30, 2015.
Days sales outstanding were almost stable at 2 days for the quarter, when compared with the last year period.
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