The Gym Group reports strong post-lockdown rebound

It said group adjusted EBITDA rocketed 110.7% year-on-year for the 12 months ended 31 December to £35.4m, and excluding normalised rent, it swung to adjusted EBITDA of £5.7m from a loss of £10.2m in 2020.

The London-listed budget gym operator said its adjusted loss for the year narrowed to £28.5m from £35.4m, while its statutory loss improved 2.7% to £35.4m.

Basic and diluted adjusted losses per share came in at 16.7p, compared to 22.5p in 2020, and the company’s basic and diluted statutory losses slimmed to 20.7p from 23.1p per share.

Non-property net debt, meanwhile, shrunk to £44.1m at year-end, from £47.3m a year earlier.

Operationally, the Gym Group reported a “significant increase” in membership numbers after its locations emerged from lockdown in April, with total members at 31 December totalling 718,000 - up from 547,000 at the end of February 2021 and 578,000 at the end of 2020.

It reported a strengthening in its yields, with the average price of a standard ‘DO IT’ membership tier rising to £19.27 per month by December from £18.81 at the end of the prior year, and the penetration of the premium ‘LIVE IT’ tier improving to 27.1% from 22.5%.

The firm said it was cash flow positive in all months when gyms were open, adding that an “accelerated” rollout was underway as it opened 19 sites in the year - 15 of which were in the second half.

Looking ahead, the Gym Group recorded an “encouraging start” to 2022, with membership growing 14.9% in the first two months despite the impact of Omicron on early January trading.

The company reported 825,000 members as at 28 February - up 50% since the same period in 2021.

It said it was planning to open 28 sites in 2022 with 20 leases already exchanged, while its rollout target was increased to between 25 and 30 openings for 2023 and 2024.

“The Gym Group has had an encouraging start to the year, building on the momentum of our excellent recovery in 2021,” said chief executive officer Richard Darwin.

“We are confident that our high margin, low-cost business model and our yield optimisation strategy will help to mitigate the impacts of the current inflationary environment.

“Our pace of change is accelerating through the launch of a new technology platform and a brand transformation in 2022 as we position our business to take advantage of the many growth opportunities within the low cost gym market.”

At 0921 GMT, shares in the Gym Group were down 3.69% at 198.4p.