Interim Results for the six month period ended 30 June 2018 29 August 2018
2018 Interim Results
Strong first half with substantial growth across all key metrics
The Gym Group plc, the fast growing, nationwide operator of 147 low cost 24/7 no contract gyms1, announces its interim results for the six month period ended 30 June 2018.
- Revenue of £58.3 million, an increase of 36.1% (H1 2017: £42.8 million)
- Group Adjusted EBITDA2 of £17.5 million, an increase of 28.0% (H1 2017: £13.7 million); EBITDA margin in line with expectations at 30.1% (H1 2017: 32.0%), reflecting immature estate profile and Lifestyle conversions
- Adjusted profit before tax3 of £7.0 million, up 8.4% (H1 2017: £6.5 million)
- Statutory profit before tax decreased by 14.4% to £5.1 million (H1 2017: £5.9 million), due to increase in exceptional costs to £1.0 million (H1 2017: £0.1 million) primarily relating to acquisition of easyGym
- Adjusted EPS4 of 4.2p, an increase of 7.8% (H1 2017: 3.9p)
- Net debt decreased to £21.6 million (December 2017: £37.5 million) due to cash of £24.0 million received from equity placing for the easyGym acquisition
- Interim dividend of 0.35 pence per share declared, up 16.7% (H1 2017: 0.30 pence)
Strategic and Operational Progress
- Six new gyms opened in H1 2018 along with acquisition of 13 easyGym sites on 4 July 2018, bringing proforma site number to 1471
- Proforma members5 (including easyGym sites) of 720,000 (June 2017: 508,000)
- 18 Lifestyle sites converted by August 2018; majority of easyGym estate to be converted by the end of 2018
- LIVE IT. take-up grows to 55,000 representing 7.6% of proforma members6 at 30 June 2018; increase in the average revenue per member per month to £14.65 (H1 2017: £14.42)
- ERP system successfully launched; will enable start of rollout of Personal Trainer model in Quarter 4
- CEO succession completed with Richard Darwin to take over as CEO in September 2018; John Treharne to remain in the business and on the Board as founder director; CFO search making good progress, expect to make an appointment by end of September
John Treharne, CEO of The Gym Group, commented:
“This has been another excellent period for The Gym Group with the hard work of 2017 beginning to come to fruition. We now have systems and technology in place to support a business of considerable size and scale with our ERP system safely landed. These investments will allow us to start the roll out of the new Personal Trainer model and further capitalise on LIVE IT., our premium pricing offer, which is proving popular with our members and experiencing strong levels of take up.
Since the end of the half year we have expanded again with the acquisition of 13 easyGyms taking us close to 150 sites. In addition, we remain well set to achieve our target range of 15 to 20 organic openings for 2018.
In my last set of results as CEO, I am confident that the business is in as strong a position as ever to execute its strategy and deliver further accelerated profitable growth. After a strong first half we are on track to meet market expectations for the full year and look forward to further progress in the second half of the year.”
An audio webcast of the analyst presentation will be available from 13:00 hours today via our website www.tggplc.com
For further information, please contact
The Gym Group
John Treharne, CEO
Richard Darwin, CFO
via Instinctif Partners
020 7260 1000
0207 457 2020
1 134 sites branded The Gym and 13 sites currently branded easyGym. By 29 August 2018 increased to 148. All gyms branded The Gym open 24/7
excluding six gyms as at 30 June 2018 due to licensing restrictions.
2 Group Adjusted EBITDA is calculated as operating profit before depreciation, amortisation, long term employee incentive costs and exceptional items.
3 Adjusted profit before tax is calculated as profit before tax before amortisation and exceptional items.
4 Adjusted EPS is calculated as the Group's profit for the period before amortisation, exceptional items and the related tax effect, divided by the diluted
weighted average number of shares.
5 Average number of members grew 34.1% to 664,000 (H1 2017: 495,000). Average members excludes sites not open at the period end.
6 55,000 LIVE IT. members at 30 June 2018 representing 7.6% of Proforma members of 720,000 (including easyGym members acquired on 4 July 2018).