Apr 19, 2005 2:12 PM
Summer Sale Possible for Bally Assets
CHICAGO—Bally Total Fitness will decide this summer which of its assets to sell, Paul Toback, chairman and CEO of Bally, said in a conference call last week with investors and analysts. Toback stated that any of the company’s assets could be put up for sale. “There may be brands that perform better in other people’s hands,” he said. The company is also on track to meet its audit deadline of July 31, he said. The company announced last year that accounting errors required a restatement of financials from 2000 through first quarter 2004, and that it would release those restated financials by July 31, 2005.
Prior to the conference call, the company released unaudited membership and cash flow information. The data showed that while the company had a 20 percent increase in the number of new joining members in 2004 compared to 2003, it only had a net increase of 1 percent in members.
However, Bally’s free cash flow improved to more than $13 million in January and February 2005 from a $7.5 million deficit during those months last year, the company reported. Toback contributed the improvement to the company keeping its costs down while increasing its revenue.
The company, which has $741 million in outstanding debt, is under investigation by the Securities and Exchange Commission and the U.S. Attorney General’s office for accounting issues.
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