New members at budget gym operator The Gym Group (GYM) have helped earnings before interest, tax, depreciation and amortisation (EBITDA) accelerate 23.2% to £28m in 2017.
The company is taking advantage of more people pursuing a healthier lifestyle at a low cost with average member numbers jumping 23.4% to 528,000.
Between the New Year and end of February, The Gym Group has attracted even more members, with sign-ups rising 9.4% to 664,000.
Sales in 2017 have climbed 24.3% to £91.4m, while the Gym Group’s market share has increased from 17.7% to 22.4%.
‘Our model continues to attract new members, including first gym-goers who are new to the market, as well as taking share from other operators,’ says the company.
ACCELERATED OPENINGS
It has been a busy year for the gym operator, which accelerated its number of sites from 89 to 128 thanks to 21 new openings and the acquisition of 18 gyms from Lifestyle Fitness.
This strategy is set to continue with between 15 and 20 organic openings planned every year.
Liberum analyst Anna Barnfather says the company’s plan to open new gyms outside London and the South East means it can move into areas with less rivals and no affordable alternatives.
‘These clubs may be smaller in nature, so optically will reduce EBITDA per site, but importantly will maintain the 32% return on capital employed track record,’ comments Barnfather.
