New York Sports Club owner files for bankruptcy

The 47-year-old company owns several gym chains, including the New York Sports Club, Boston Sports Club and Lucille Roberts. A sharp drop in revenue during the pandemic forced it to temporarily close its facilities for several months. The Chapter 11 filing aims to “substantially” reduce its leverage and “strengthen the company’s capital structure to support its ongoing operations,” according to a statement he posted for his members.
City sports (CLUB) listed liabilities of $500 million to $1 billion in its filing. The company warned in June of potential bankruptcy because “the extent and duration of the disruption to our operations has significantly reduced our cash flow.” To preserve cash, it laid off many of its 7,000 employees and stopped paying rent.

Last week, it said in its latest earnings report that the majority of its sites remained closed.

“We expect the Covid-19 pandemic to continue to negatively impact our results of operations in the periods ahead,” Town Sports said.

For now, Town Sports has said it will not permanently close any of its nearly 200 gyms, which have around 605,000 members.

Several gym chains have filed for bankruptcy in recent months, including Gold’s Gym and 24 hour fitness. Venues have started to reopen gradually with capacity restrictions and safety measures. However, some people might be too nervous to join, which benefited Platoon (PTON). The home fitness company reported successful income last week and several new products.

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