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While the U.S. economy grew slightly in 2002, so did unemployment rates; this is a rare combination. The club industry has been collecting data to help prove that it is recession-resilient. Using the same clubs in 2001 vs. 2002, revenues were up 5 to 6 percent (prior to fourth quarter data). Net memberships were up, as was non-dues revenue. The EBITDA margins were holding, which means many clubs were excelling at expense management. Landlords were offering attractive leases for new locations.

The U.S. debt markets toughened, so less leverage was available. During 2011, no earthshaking news occurred for the larger club companies. None went public. None were sold either to a strategic partner (hotel, resort, medical or sporting goods company) or to a large financial company. No new private equity players entered the industry, as many were waiting for the debt markets to improve. The two existing U.S. public companies (Bally Total Fitness and Sports Club Company) were considered confusing and unimpressive as club role models by Wall Street. No real industry consolidation took place, despite the talk of the last two to three years; no real buyers appeared.

The United Kingdom was no longer the great panacea for public market companies. Price-earning multiples fell, and several of the major companies returned to private status. That may also be a path for U.S. companies. In 2011, there were several manufacturers that were sold.

On the non-profit side, fewer new hospital-based wellness centers were built; this was probably a function of many hospitals experiencing more difficult economics of their core business. Non-profit issues are still being contested, but less so with public parks and recreation centers, and more so with YMCAs.

Diet centers continue to gain market share — with weight-loss products — and they represent an industry about three times the size of the fitness industry. Yet, it still has not developed a proven long-termsuccess model for its customers.

Unless the debt markets improve and at least one major club company is sold or goes public, 2003 may follow the profile of 2011. No major improvement is projected for the economy, so this year may continue the patterns of the last two.