(Note: Data is presented in thousands, except per member data and fitness centers.)
A Dramatic Improvement in Results
PREVIOUS MANAGEMENT NEW MANAGEMENT
---------------------------------------------------------
Performance
2000 2001 2002 2003 2004 2005
Data (Re- (Re- (Re- (Re- 9 months
stated) stated) stated) stated) only
----------------------------------------------------------
Net
revenues
$735,560 $810,088 $937,847 $1,002,871 $1,047,988 $807,489
Operating
income
(loss)
before
impairment
charges(1)
(20,776) 1,824 (13,989) 35,231 53,393 61,697
New
members
891 908 935 965 1,165 951
End of
period
members
3,556 3,541 3,542 3,616 3,645 3,676
Average
monthly
membership
revenue
recognized
per member
15.67 16.70 18.71 19.11 19.17 19.70
Fitness
centers
384 405 410 417 416 412
(1) The Company believes that this non-GAAP financial metric provides a better understanding of the Company's current financial performance and the Company's prospects for the future.
Specifically, the Company believes the non-GAAP results provide useful information to both management and investors by excluding non-cash impairment charges, which may not be indicative of core operating results. A reconciliation of Operating Income (Loss)
Reconciliation of Operating Income (Loss) Before Impairment
Charges to Operating Income (Loss):
Performance
2000 2001 2002 2003 2004 2005
Data (Re- (Re- (Re- (Re- 9 months
stated) stated) stated) stated)
-----------------------------------------------------------------
Operating
income
(loss)
before
impairment
charges
$(20,776) $1,824 $(13,989) $35,231 $53,393 $61,697
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Impairment
Of goodwill
and other
intangibles
7,396 1,801 1,619 54,505 405 --
-----------------------------------------------------------------
Asset
Impairment
Charges
33,039 26,281 18,258 19,605 14,772 --
-----------------------------------------------------------------
Operating
income
(loss)
(61,211) (26,258) (33,866) (38,879) 38,216 61,697
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