For the first time in company history, Life Time Fitness, Chanhassen, MN, hit the $1 billion mark in total revenue.

Life Time announced the milestone Thursday when it released its fourth quarter 2011 and year-end financials. The company generated $1.014 billion in 2011 revenue, an 11 percent increase from the $912.8 million Life Time produced in 2010.

Also, Life Time had $250.9 million in revenue in fourth quarter 2011, a 12 percent increase from the $223.7 million in the same period last year.

“2011 marked another strong year of operating results for Life Time,” CEO Bahram Akradi said in a statement. “We achieved our stretch revenue goal of $1 billion, marking a key milestone for our company. We also re-established a faster growth rate via increased square footage, membership price and mix optimization, and sustained improvement in our in-center and ancillary business revenue.”

Life Time enjoyed double-digit growth in net income, too. In fourth quarter 2011, the company had $19.8 million in net income compared to $17.6 million in fourth quarter 2010. For the year, Life Time increased net income 14.8 percent from $80.7 million in 2010 to $92.6 million in 2011.

On Dec. 31, 2011, Life Time had 676,054 memberships, a 10.4 percent increase from 612,556 memberships at the end of 2010. Excluding memberships that Life Time gained in last year’s Lifestyle Family Fitness acquisition, in which Life Time added nine former Lifestyle clubs in Ohio, Indiana and North Carolina, memberships grew 5.5 percent for the year.

Attrition in fourth quarter 2011 was down slightly from the same period last year (9.6 percent compared to 9.9 percent). Overall attrition was 35 percent in 2011 compared to 36.3 percent in 2010, beating Akradi’s stated goal of 36 percent attrition.

Total operating expenses for fourth quarter 2011 were $214 million compared to $189.1 million in the same period last year. Operating expenses for 2011 were $840.4 million compared to $752.1 million in 2010.

“There is no free lunch,” Akradi told analysts during a conference call Thursday. “If we want to remain the best destination for people, the best programs, we will continually have to invest. So we’re targeting that customer base now that appreciates the best product, and they’re not going to be mercenaries about the price. They’re looking for getting what they want. To get that customer in, we actually do have to deliver the best product, and that’s what we’re driving here every day.”

For 2012, Life Time expects its revenue to increase 10 percent to 12 percent, or $1.110 billion to $1.135 billion, and net income to increase 18 percent to 24 percent, or $110 million to $115 million.

As of Thursday, not counting the nine former Lifestyle clubs, Life Time operated 93 clubs in 21 states and 26 major markets.

CONTINUED ON NEXT PAGE

In 2011, Life Time opened a large-format club in Syosset, NY, the first Life Time location in the state of New York, and later added clubs in Colorado Springs, CO, and Summerlin, NV, the company’s first club in the Las Vegas market.

In late December, Life Time acquired from a landlord six facilities that the company already operated in the Minneapolis and Boca Raton, FL, markets. The company said it assumed a $72 million mortgage and paid the remainder in cash.

At the end of 2011, Life Time operated 9.5 million square feet of fitness facilities, including approximately 300,000 square feet for the nine acquired Lifestyle clubs.

Life Time got a jump on 2012 expansion last month when it acquired Atlanta-based Racquet Club of the South, which will be rebranded as Life Time Tennis Atlanta. Next month, Life Time will open its first Canadian club in the Toronto suburb of Mississauga, Ontario. In April, Life Time plans to open its first Oklahoma club in Tulsa, OK, and in May, it will open its fifth club in Atlanta.

CFO Michael Robinson told analysts that Life Time sold more than 40,000 memberships in January. The net increase on a year-over-year basis was around 20,000 memberships, Robinson said.

“We feel that in order for us to get the memberships we’re getting, we have to fight for every single one,” Akradi said. “So every day, there is a fight to get the memberships we are bringing in and keep the ones we’re keeping.”

“We’re working hard,” Robinson added, “but we’re also winning in this environment.”

On Thursday, Life Time, which is traded on the New York Stock Exchange, saw a 1.55 percent increase in its stock price to $51.07 for a market cap of $2.16 billion, John Udovich of SmallCapNetwork.com reported. Also, Life Time’s stock is up over 9 percent since the start of the year, 15.5 percent over the past year and 2.3 percent over the past five years, Udovich reported.