SELECTED OPERATING DATA
The following operating data reflect membership sales and cash flow data. Since this data is not affected by the Company's revenue recognition policy, the Company does not expect these items to change as a result of the recently announced restatements. In addition, the following operating data has not been reviewed by KPMG LLP and therefore is subject to change, which changes may be material individually or in the aggregate.
The following table shows new membership originations and other key data for the three and nine months ended September 30, 2004 and 2003:
Three months ended Nine months ended
Operating Data September 30 September 30
------------------------ ------------------------
(in thousands
except % %
monthly data) 2004 2003 Chg 2004 2003 Chg
--------- --------- ---- --------- --------- ----
New joining
members 260 229 14% 873 710 23%
Average committed
monthly fee
(dollars) $37.99 $37.98 0% $38.27 $39.72 -4%
Average
committed
duration
(in months) 29.7 30.8 -4% 29.6 30.6 -3%
Gross committed
membership fees:
Total Company $293,430 $264,586 11% $989,620 $852,620 16%
Same club $272,130 $260,854 4% $917,970 $836,016 10%
Members (end of
period) 4,040 3,975 2% 4,040 3,975 2%
Gross committed membership fees is a measure which includes the total potential future value of all initial membership fee revenue, dues revenue, earned finance charges and membership-related products and services revenue from new membership sales originations in a period. It is measured on a gross basis before consideration of any uncollectible amounts. We track gross committed membership revenue as an indicator of the success of our current sales activities and believe it to be a useful measure to allow investors to understand current trends in membership sales.
The following table shows selected cash flow and balance sheet data:
(in thousands) 2004
--------------------------------------
Cash flow Nine months Three months ended ended
----------------------------- --------
March 31 June 30 Sept. 30 Sept. 30
--------- --------- --------- --------
Cash provided by operating
activities $9,373 $16,674 $808 $26,855
Cash used in investing
activities (10,081) (11,351) (8,087) (29,519)
--------- --------- --------- --------
Free cash flow (deficit) $(708) $5,323 $(7,279) $(2,664)
========= ========= ========= ========
Selected balance sheet data As of
-----------------------------
March 31 June 30 Sept. 30
--------- --------- ---------
Cash & equivalents $13,113 $12,520 $25,331
Total debt 731,751 723,363 747,734
--------- --------- ---------
Net debt $718,638 $710,843 $722,403
========= ========= =========
The variance in cash provided by operating activities between the second and third quarters of 2004 is largely due to the fluctuation in accounts payable and accrued liabilities.