Fitness Holdings International Inc., the parent of Busy Body Home Fitness, OMNI Fitness Equipment and LA Gym Equipment, filed for Chapter 11 bankruptcy protection. The fitness retailer blamed economic weakness and a lender that called in a loan. The Long Beach, CA-based company said it plans to hold store closing sales for 19 locations to conclude by the end of November, subject to bankruptcy court approval.
The retailer operates 67 Busy Body Home Equipment stores and 44 Omni Fitness Equipment stores. In 2005, it acquired LA Gym Equipment.
The petition for Chapter 11 protection filed in Los Angeles listed as much as $50 million in assets and $50 million to $100 million in liabilities. FHI said it owes $18.7 million in secured debt under a term loan from Pacific Western Bank. It also has a subordinated, unsecured loan of $27.5 million.
Lifetime Fitness is listed as the company’s largest creditor at $1.3 million, which is designated as a disputed claim. Aerobics, Inc., with $1.0 million, Precor ($749k), Lemond Fitness ($703k), and Hoist Fitness Systems ($638k) round out the top five trade creditors.
“The impact of weakness in the economy and declines in the performance of the retail sector, in general, has negatively impacted sales at the debtor’s stores,” said CEO Kenton Van Harten in court papers obtained by SportsOneSource.
The company generated total revenue of about $115 million for its fiscal year ended June 30. For the same period, it had a loss of about $4.4 million before interest, taxes, depreciation and amortization.
