Bally Total Fitness Holding (Bally Total Fitness Holding) Operating Income : $96.08 Mil (TTM As of Jun. 2007)

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What is Bally Total Fitness Holding Operating Income?

Bally Total Fitness Holding's Operating Income for the three months ended in Jun. 2007 was $14.03 Mil. Its Operating Income for the trailing twelve months (TTM) ended in Jun. 2007 was $96.08 Mil.

Operating Margin % is calculated as Operating Income divided by its Revenue. Bally Total Fitness Holding's Operating Income for the three months ended in Jun. 2007 was $14.03 Mil. Bally Total Fitness Holding's Revenue for the three months ended in Jun. 2007 was $235.46 Mil. Therefore, Bally Total Fitness Holding's Operating Margin % for the quarter that ended in Jun. 2007 was 5.96%.

Bally Total Fitness Holding's 5-Year average Growth Rate for Operating Margin % was 0.00% per year.

Operating Income or EBIT is linked to Return on Capital for both regular definition and Joel Greenblatt's definition. Bally Total Fitness Holding's annualized ROC % for the quarter that ended in Jun. 2007 was 4.20%. Bally Total Fitness Holding's annualized ROC (Joel Greenblatt) % for the quarter that ended in Jun. 2007 was 23.52%.

Bally Total Fitness Holding Operating Income Historical Data

The historical data trend for Bally Total Fitness Holding's Operating Income can be seen below:

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.

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Bally Total Fitness Holding Operating Income Chart

Bally Total Fitness Holding Annual Data

Trend

Dec97

Dec98

Dec99

Dec00

Dec01

Dec02

Dec03

Dec04

Dec05

Dec06

Operating Income

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868.85

931.91

38.12

79.64

114.11

Bally Total Fitness Holding Quarterly Data
	Sep02	Dec02	Mar03	Jun03	Sep03	Dec03	Mar04	Jun04	Sep04	Dec04	Mar05	Jun05	Sep05	Dec05	Mar06	Jun06	Sep06	Dec06	Mar07	Jun07
Operating Income	Get a 7-Day Free Trial															24.23	19.89	51.97	10.20	14.03

Bally Total Fitness Holding Operating Income Calculation

Operating Income, is the profit a company earned through operations. All expenses, including cash expenses such as cost of goods sold (COGS), research & development, wages, and non-cash expenses, such as depreciation, depletion and amortization, have been deducted from the sales.

Operating Income for the trailing twelve months (TTM) ended in Jun. 2007 adds up the quarterly data reported by the company within the most recent 12 months, which was $96.08 Mil.

Bally Total Fitness Holding (GREY:BLLYW) Operating Income Explanation

1. Operating Income or EBIT is linked to Return on Capital for both regular definition and Joel Greenblatt's definition.

Bally Total Fitness Holding's annualized ROC % for the quarter that ended in Jun. 2007 is calculated as:

	ROC % (Q: Jun. 2007 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (Q: Mar. 2007 )	+	Invested Capital (Q: Jun. 2007 ))	/ count )
=	56.112 * ( 1 - -3.37% )	/	( (1397.82	+	1364.737)	/ 2 )
=	58.0029744	/	1381.2785
=	4.20 %

where

	Invested Capital		(Q: Mar. 2007 )
=	Total Assets	-	Accounts Payable & Accrued Expense	-	Excess Cash
=	Total Assets	-	Accounts Payable & Accrued Expense	-	( Cash, Cash Equivalents, Marketable Securities	-	max(0, Total Current Liabilities	-	Total Current Assets	+	Cash, Cash Equivalents, Marketable Securities	))
=	431.866	-	162.027	-	( 71.873	-	max(0, 1242.825	-	114.844	+	71.873	))
=	1397.82

	Invested Capital		(Q: Jun. 2007 )
=	Total Assets	-	Accounts Payable & Accrued Expense	-	Excess Cash
=	Total Assets	-	Accounts Payable & Accrued Expense	-	( Cash, Cash Equivalents, Marketable Securities	-	max(0, Total Current Liabilities	-	Total Current Assets	+	Cash, Cash Equivalents, Marketable Securities	))
=	411.379	-	169.623	-	( 70.761	-	max(0, 1231.991	-	109.01	+	70.761	))
=	1364.737

Note: The Operating Income data used here is four times the quarterly (Jun. 2007) data.

2. Joel Greenblatt's definition of Return on Capital:

Bally Total Fitness Holding's annualized ROC (Joel Greenblatt) % for the quarter that ended in Jun. 2007 is calculated as:

	ROC (Joel Greenblatt) %		(Q: Jun. 2007 )
=	EBIT	/	Average of (Net fixed Assets	+	Net Working Capital)
=	EBIT	/	Average of (Property, Plant and Equipment	+	Net Working Capital)
			Q: Mar. 2007		Q: Jun. 2007
=	EBIT	/	( ( (Property, Plant and Equipment + Net Working Capital)	+	(Property, Plant and Equipment + Net Working Capital) )	/	count )
=	56.112	/	( ( (242.85 + max(-398.365, 0))	+	(234.392 + max(-392.96, 0)) )	/	2 )
=	56.112	/	( ( 242.85	+	234.392 )	/	2 )
=	56.112	/	238.621
=	23.52 %

where Working Capital is:

	Working Capital		(Q: Mar. 2007 )
=	(Accounts Receivable	+	Total Inventories	+	Other Current Assets)	-	(Accounts Payable & Accrued Expense	+	Defer. Rev.	+	Other Current Liabilities)
=	(0	+	0	+	42.971)	-	(162.027	+	0	+	279.309)
=	-398.365

	Working Capital		(Q: Jun. 2007 )
=	(Accounts Receivable	+	Total Inventories	+	Other Current Assets)	-	(Accounts Payable & Accrued Expense	+	Defer. Rev.	+	Other Current Liabilities)
=	(0	+	0	+	38.249)	-	(169.623	+	0	+	261.586)
=	-392.96

When net working capital is negative, 0 is used.

Note: The EBIT data used here is four times the quarterly (Jun. 2007) EBIT data.

3. Operating Income is also linked to Operating Margin %:

Bally Total Fitness Holding's Operating Margin % for the quarter that ended in Jun. 2007 is calculated as:

Operating Margin %	=	Operating Income (Q: Jun. 2007 )	/	Revenue (Q: Jun. 2007 )
	=	14.028	/	235.46
	=	5.96 %

4. Please click Growth Rate Calculation Example (GuruFocus) to see how GuruFocus calculates Wal-Mart Stores Inc (WMT)'s revenue growth rate. You can apply the same method to get the Operating Income growth rate using Operating Income per share data.

Be Aware

Compared with a company's EBITDA margin, Operating Margin can be manipulated by adjusting the rate of depreciation, depletion and amortization (DDA).

If a company is facing competition, its Operating Margin may decline. Often the Operating Margin declines well before the company's revenue or even profit decline. Therefore, Operating Margin is a very important indicator of whether the company is facing problems.

For instance, by 2012, Nokia (NOK)'s problems were well known and its stock had lost more than 90% of its market value since 2007. But Nokia's Operating Margin had already been in decline since 2002, although its earnings per share were still rising. Investors who paid attention to Operating Margin would have avoided this huge loss. The same can be said for Research-in-Motion (RIMM).

Therefore, Operating Margin is a very important screening filter for GuruFocus. GuruFocus's Buffett-Munger screener requires that the profit margin is either consistent or expanding. The Model Portfolio of the Buffett-Munger screener has outperformed the market every year since inception in 2009.

Bally Total Fitness Holding Operating Income Related Terms

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Bally Total Fitness Holding (Bally Total Fitness Holding) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Consumer Cyclical » Travel & Leisure » Bally Total Fitness Holding Corp (GREY:BLLYW) » Definitions » Operating Income

Comparable Companies

Traded in Other Exchanges

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Address

8700 West Bryn Mawr Avenue, Chicago, IL, USA, 60631

Website

http://www.ballyfitness.com

Bally Total Fitness Holding is the largest commercial operator of fitness centers in the United States in terms of revenue, number of members, and square footage of facilities. The company operates more than 400 fitness centers with approximately 4 million members. Its fitness centers are generally 30,000 square feet in size and include such amenities as a workout area, sauna and steam facilities, a lap pool, free-weight rooms, aerobic-exercise rooms, an indoor jogging track, and racquetball courts.

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