AI Terminal
Basic-Fit N.V.
Earnings Release • Oct 18, 2024
3818_iss_2024-10-18_7e9a2046-ecd8-44b3-b033-b6be86d8ce51.pdf
Earnings Release
Open in ViewerOpens in native device viewer
BASIC-FIT PRESS RELEASE Q3 2024 TRADING UPDATE
Hoofddorp, 18 October 2024
BASIC-FIT REPORTS STRONG GROWTH OVER FIRST NINE MONTHS Well on track to reach the 2024 targets
FIRST NINE MONTHS HIGHLIGHTS
- Revenue increased by 17% to €892 million in first nine months (9M 2023: €765 million)
- Number of clubs increased by 14% (up 194) to 1,570 versus a year ago (up 168 year to date)
- Number of memberships increased by 13% year on year to 4.20 million (9M 2023: 3.71 million)
- Average revenue per member per month increased to €23.86 (9M 2023: €23.28)
OUTLOOK 2024
- Club network to increase to around 1,575 clubs per year-end 2024
- Revenue of between €1.20 billion to €1.25 billion
- Underlying EBITDA less rent1 of between €305 million and €330 million (+17% to +26% vs €261 million in 2023)
- Free cash flow before new club expansion per share of between €2.60 and €2.95 (+24% to +41% vs €2.09 in 2023)
- ROIC of mature clubs of well over 30%
RENE MOOS, CEO BASIC-FIT
"The first nine months of the year developed according to plan with continued strong growth in revenue and memberships. We are well on track to reach our year-end targets and empower an ever-growing number of individuals to embrace a healthier lifestyle. In France, membership growth trends have been improving on the back of the continued investments in the quality of our clubs and longer opening hours. We will continue to improve our offering in France, offering massage chairs in all clubs and further increasing opening hours.
The strong back-to-school campaign resulted in a further growth of our membership base by 112 thousand in the quarter, which we see continuing in the first weeks of October 2024.
I am also pleased that the performance of the mature clubs continued to improve. The average revenue and the average underlying club EBITDA less rent over the first nine months of our 993 mature clubs, including the 2021 cohort, improved compared to the averages of the 882 mature clubs in the same period in 2023."
1 Definitions of all alternative performance measures (APM's) used in this press release can be found in the APM section in this report.
KPIs
| 9M 2024 | 9M 2023 | change | |
|---|---|---|---|
| Revenue (€ millions)* | 892 | 765 | 17% |
| Clubs | 1,570 | 1,376 | 14% |
| Memberships (millions) | 4.20 | 3.71 | 13% |
| Avg. revenue per membership (€)* | 23.86 | 23.28 | 3% |
CLUB NETWORK & MEMBERSHIP DEVELOPMENT
| Sep 2024 | Dec 2023 | Sep 2023 | |
|---|---|---|---|
| Netherlands | 242 | 237 | 238 |
| Belgium | 229 | 223 | 222 |
| Luxembourg | 10 | 10 | 10 |
| France | 852 | 781 | 763 |
| Spain | 209 | 139 | 135 |
| Germany | 28 | 12 | 8 |
| Total | 1,570 | 1,402 | 1,376 |
Geographic club split
In the first nine months, we increased our club network by 168 clubs to 1,570. We opened 173 clubs and closed 5 clubs. Most of the club openings were in France, where we operated 852 clubs (YTD +71) at the end of the period. In Spain we increased our club network by 70, including the 42 acquired clubs, to 209 clubs. Nearly all acquired clubs were converted to the Basic-Fit brand at the end of the quarter. In the Benelux we increased the number of clubs year to date by 11 to 481. In Germany we increased the number of clubs by 16 to 28 clubs.
REVENUE DEVELOPMENT
Basic-Fit reported a 17% increase in revenue to €892 million over the first nine months of 2024 (9M 2023: €765 million). The increase is the result of a strong club openings programme and the growth in memberships, combined with the higher average revenue per member.
ADJUSTMENTS TO MEMBERSHIP STRUCTURE IN 2025
From 2025 onwards, we will implement some changes to our membership structure. Ahead of this, we already introduced weekly prices in France as of 1 October, emphasising the affordability of a membership. This also allows for slight price increases of the Comfort and Premium membership. A Basic membership now costs €4.99 a week (from €19.99 per four weeks), a Comfort membership €6.99 and a Premium membership €7.99 a week (from €24.99 and €29.99 per four weeks respectively).
LAUNCH OF FRANCHISE PLATFORM IN 2025
After having announced our plans to explore a franchise model during the capital markets day in November 2023, we see great opportunities and are now ready to take the next steps and start our own franchise business. Basic-Fit expects to launch a franchise platform during 2025 in which it can leverage its scale advantages, technologies and knowledge. The franchise business will require limited capex and opens up possibilities to expand to new countries. We are currently in discussion with strong potential franchisee partners with ample franchise experience in their respective countries. We expect that the first franchise clubs will be opened in the course of 2025, at which time we will communicate more details.
2024 OUTLOOK & CLUB OPENINGS PIPELINE
We confirm the outlook of our main key performance indicators for 2024 as communicated at the time of our Q1 2024 trading update in April. We expect the club network to increase to around 1,575 clubs. Revenue is expected to increase to between €1.20 billion to €1.25 billion, mainly as a result of the continued growth of our membership base and average revenue per member. The reintroduction of the Basic membership in France this year and the continued offering of the lower priced membership in the past quarters leads to an expected average revenue per member per month of around €24.25 for the year (was €24.50). The underlying EBITDA less rent is expected to increase to between €305 million and €330 million. The free cash flow before new club expansion per share is expected to amount to between €2.60 and €2.95. The ROIC of mature clubs is expected to be well over 30%.
Club openings pipeline (# clubs)
- END -
FOR MORE INFORMATION
Basic-Fit Investor Relations +31 (0)23 302 23 85 [email protected]
Basic-Fit is listed on Euronext Amsterdam in the Netherlands ISIN: NL0011872650 Symbol: BFIT
AUDIO WEBCAST Q3 TRADING UPDATE
Date and time: 18 October 2024 at 10.00 CET Link to webcast (corporate.basic-fit.com/investors/financial-results)
FINANCIAL CALENDAR
Full-year 2024 results 12 March 2025
ABOUT BASIC-FIT
With 1,570 clubs, Basic-Fit is the largest and fastest growing fitness operator in Europe. The company operates in six countries and has more than 4.2 million memberships. Basic-Fit operates a straightforward membership model and offers a high-quality, value-for-money fitness experience that appeals to the fitness needs of all people who care about their personal health and fitness.
NOTES TO THE PRESS RELEASE
The financials are presented in millions of euros and all values are rounded to the nearest million unless otherwise stated. Change percentages and totals are calculated before rounding. As a consequence, rounded amounts may not add up to the rounded total in all cases.
This press release contains inside information within the meaning of Article 7(1) of the EU Market Abuse Regulation.
ALTERNATIVE PERFORMANCE MEASURES
The financial information in this report includes non-IFRS financial measures and ratios (e.g. underlying club EBITDA less rent, underlying EBITDA less rent, exceptional items, underlying net result and net debt) that are not recognised as measures of financial performance or liquidity under IFRS. In addition, Basic-Fit discloses certain other operational data, such as the number of clubs, number of members and number of countries in which Basic-Fit is present. The non-IFRS financial measures presented are measures used by management to monitor the underlying performance of the business and operations and, have therefore not been audited or reviewed. Furthermore, they may not be indicative of historical operating results, nor are they meant to be predictive of future results. These non-IFRS measures are presented because they are considered important supplementary measurements of Basic-Fit's performance, and we believe that these and similar measures are widely used in the industry in which Basic-Fit operates as a way to evaluate a company's operating performance and liquidity. Not all companies calculate non-IFRS financial measures in the same manner or on a consistent basis. As a result, these measures and ratios may not be comparable to measures used by other companies under the same or similar names.
| Term | Definition |
|---|---|
| Fitness revenue | Revenue from memberships, as well as from add-ons like sports water and personal online coach |
| Club revenue | Total of fitness revenue and other club revenue |
| Yield (ARPU) per month | Fitness revenue divided by average members of the period (divided by number of months in the period) |
| Club EBITDA | EBITDA before overhead costs and net result from non-club revenue (webshop and NXT Level) |
| Underlying club EBITDA less rent | Club EBITDA adjusted for exceptional items and minus invoiced rent costs of opened clubs |
| Underlying club EBITDA less rent margin | Underlying club EBITDA less rent as a percentage of club revenue |
| Overhead | Total costs related to (local) headquarters, including all IT development, customer care and marketing. The gross result (gain or loss) on non-club revenue is also included |
| EBITDA | Profit (loss) before interest, taxes, depreciation, amortisation and COVID-19 rent credit |
| Underlying EBITDA less rent | EBITDA adjusted for exceptional items and minus invoiced rent costs |
| Underlying EBITDA less rent margin | Underlying EBITDA less rent as a percentage of total revenue |
| EBIT (operating profit) | Profit (loss) before interest and taxes |
| Exceptional items | Exceptional items include start-up costs for new countries, costs related to club closures and other costs or profits that are of a one-off nature or do not reflect the normal operations of the business |
| Underlying net result | Net result adjusted for IFRS16, PPA amortisation, IRS valuation differences, non-cash convertible bond accruals, exceptional items, one-offs and the related tax effects |
| Basic underlying EPS | Underlying net result divided by the weighted average number of shares |
| Diluted underlying EPS | Underlying net result divided by the weighted average number of diluted shares |
| Net debt | Total of long-term and short-term borrowings and IFRS16 lease liabilities, less cash and cash equivalents |
| Net debt (excl. lease liabilities) | Total of long-term and short-term borrowings, less cash and cash equivalents |
| Working capital | Total of inventories plus trade and other receivables, minus trade and other payables |
| Mature club ROIC | Underlying mature club EBITDA less rent as a percentage of the initial investment to build a club |
| Mature club | Club that has been open for 24 months or more at the start of the year |
| Mature club revenue | Revenue of mature clubs |
| Mature club underlying EBITDA less rent | Underlying EBITDA less rent of mature clubs |
| Mature club underlying EBITDA less rent margin | Underlying EBITDA less rent of mature clubs as a percentage of mature club revenue |
| Free cash flow before new club capex | Underlying EBITDA less rent, maintenance capex, other capex, cash interest and cash taxes |
| Initial capex newly built club | Total expenses newly built clubs divided by the number of newly built clubs |
| Expansion capex | Total expenses of newly built clubs, acquisitions, existing club enlargements and expenses for clubs that are not yet open |
| Maintenance capex | Capex to maintain the club and replace or refurbish the fitness equipment |
| Average maintenance capex per club | Total maintenance capex divided by the average number of clubs |
FORWARD-LOOKING STATEMENTS / IMPORTANT NOTICE
Some statements in this press release may be considered 'forward-looking statements'. By their nature, forward-looking statements involve risk and uncertainty because they relate to events and depend on circumstances that may occur in the future. These forward-looking statements involve known and unknown risks, uncertainties and other factors that are outside of our control and impossible to predict and may cause actual results to differ materially from any future results expressed or implied. These forward-looking statements are based on current expectations, estimates, forecasts, analyses and projections about the industry in which we operate and management's beliefs and assumptions about possible future events. You are cautioned not to put undue reliance on these forward-looking statements, which only express views as at the date of this press release and are neither predictions nor guarantees of possible future events or circumstances. We do not undertake any obligation to release publicly any revisions to these forward-looking statements to reflect events or circumstances after the date of this press release or to reflect the occurrence of unanticipated events, except as may be required under applicable securities law.
