After strong 2023 Gym Group plans further growth as low-cost fitness market booms
The low-cost gym operator The Gym Group today announced a jump in revenue for last year amid higher prices and customer numbers.
The company said revenue for the year grew 18 per cent, with the average number of members using its facilities rising eight per cent. The average revenue per member per month grew nine per cent.
However, despite higher sales the company was hit by higher costs as well. The Gym Group reported earnings before interest, taxes, depreciation, and amortisation (EBITDA) for the year of £75.5m, up just six per cent year-on-year.
Overall, the group reported a statutory loss before tax of £8.4m, an improvement from the £19.3m loss reported last year.
During the year, The Gym Group pushed through price hikes to offset its higher cost base. The firm said the average headline price of a Standard membership increased to £23.16 in December 2023, compared with £21.49 in December 2022. Higher joining prices for new members and a higher number of users signing up to the group’s premium membership offering contributed to the higher overall figure.
Management said the company will open 50 new sites over the next three years, with a targeted return on invested capital per site of 30 per cent. The Gym Group believes that, based on analysis by PwC, there’s scope for 600 to 850 additional low-cost gym sites throughout the UK.
Will Orr, chief of The Gym Group, said: “We have maintained positive momentum in revenue through the second half to deliver results that have offset cost inflation, in line with our guidance. With a strong start to 2024, and clear signs that demand for health and fitness has never been stronger, these are solid foundations on which to build our Next Chapter growth plan.
“Over the next three years, we aim to strengthen the performance of our core business and accelerate The Gym Group site rollout. There continues to be substantial headroom for low cost gyms in the UK and we are fully focused on our aim of making high value, low cost fitness even more accessible for all.”