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Steiner Leisure Ltd. Reports Operating Results (10-Q)

November 08, 2010 | About:
10qk

10qk

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Steiner Leisure Ltd. (STNR) filed Quarterly Report for the period ended 2010-09-30.

Steiner Leisure Ltd. has a market cap of $628.39 million; its shares were traded at around $42.33 with a P/E ratio of 15.06 and P/S ratio of 1.28. Steiner Leisure Ltd. had an annual average earning growth of 11.7% over the past 10 years. GuruFocus rated Steiner Leisure Ltd. the business predictability rank of 4-star.STNR is in the portfolios of Diamond Hill Capital of Diamond Hill Capital Management Inc.

Highlight of Business Operations:

Goodwill and intangibles is subject to at least an annual assessment for impairment by applying a fair value-based test. The impairment loss is the amount, if any, by which the implied fair value of goodwill is less than the carrying value. As of September 30, 2010 and December 31, 2009, we had goodwill of $117.3 million and $121.6 million, respectively, and unamortized intangibles of $26.9 million and $27.2 million, respectively.

Total revenues increased approximately 23.1%, or $30.2 million, to $161.1 million in the third quarter of 2010 from $130.9 million in the third quarter of 2009. Of this increase, $17.7 million was attributable to a increase in services revenues and $12.5 million was attributable to a increase in products revenues.

Spa Operations Segment Revenues. Spa Operations segment revenues increased approximately 20.7%, or $20.2 million, to $118.2 million in the third quarter of 2010 from $98.0 million in the third quarter of 2009. In addition, average weekly revenues for our land-based spas increased 34.9% to $26,274 in the third quarter of 2010 from $19,473 in the third quarter of 2009. These increases were primarily attributable to the acquisition of Bliss Inc. in December 2009. We had an average of 2,309 shipboard staff members in service in the third quarter of 2010, compared to an average of 2,092 shipboard staff members in service in the third quarter of 2009. Revenues per shipboard staff per day increased by 0.1% to $442 in the third quarter of 2010 from $440 in the third quarter of 2009. Average weekly revenues for our shipboard spas increased by 6.0% to $54,357 in the third quarter of 2010 from $51,302 in the third quarter of 2009. Excluding the acquisition of Bliss Inc., the increase in revenues and the key performance indicators referenced above were primarily attributable to some strengthening of the economy worldwide, resulting in increased spending by consumers at our spas.

Products Segment Revenues. Products segment revenues increased approximately 40.1%, or $9.2 million to $32.3 million in the third quarter of 2010 from $23.1 million in the third quarter of 2009. This increase is primarily attributable to the acquisition of Bliss Inc. in December of 2009 and to a strengthening of the economy worldwide, resulting in increased spending by consumers on our products.

Cost of services increased $15.6 million to $88.2 million in the third quarter of 2010 from $72.6 million in the third quarter of 2009. Cost of services as a percentage of services revenues was 81.6% in the third quarter of 2010 and 80.4% in the third quarter of 2009. This increase was primarily due to the weak performance of our land-based spas, which was partially offset by the improved performance of our Products segment.

Cost of products increased $9.4 million to $36.9 million in the third quarter of 2010 from $27.5 million i

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