The Gym Group reports 'good levels of membership demand' as it plans to open site in York
The Gym Group today said there were encouraging signs that it should be able re-open its English gyms quickly when the latest lockdown ends.
The Gym Group confirmed that it closed its 167 gyms in England on November 4 2020, following the introduction of the four-week lockdown announced by the UK Government.
The company’s three gyms in Wales closed on October 26 as part of a two-week lockdown announced by the Welsh Assembly; its 13 gyms in Scotland remain open.
During this closure period, the company said it will manage its cash outflow by minimising operating costs and using the Government furlough scheme. It expects its monthly cash burn during closure to be around £6.0 million.
The Gym Group recently announced that it had signed a 15-year lease for a new gym in York which will open in the first half of 2021.
Located on Foss Island Road and next to Halfords, the site was previously a retail warehouse and has been vacant since 2018. It will create 12 jobs following the investment of around £1.4m.
In a trading statement issued today, the company added: "Since re-opening on July 25 2020, the company has had over 10 million visits with very positive feedback from colleagues and members about the many measures taken to ensure gyms are Covid-secure.
"Across the UK Health and Fitness sector, adherence to Covid-secure procedures has been strong and in the week ending October 11 industry data shows cases of Covid-19 were only 2.88 per 100,000 visits. This sector-wide data convinced government to keep gyms open in all areas of the UK, including Tier 3 regions, until the most recent announcement of a national lockdown.
"In recent weeks the company successfully re-started 24-hour operations in a number of sites and expects to roll this out more widely upon re-opening."
"Membership grew from reopening until the second half of September, when the emergence of a second wave of Covid-19 meant member levels started to decline with total membership on October 31 2020 of 639,000. Despite this, over the three-month period ongoing paying members were up 2.4% at 588,000 ."
Since re-opening, the company has traded profitably and cash generatively.
Richard Darwin, CEO of The Gym Group, commented: “In the three months since reopening The Gym Group has seen good levels of membership demand reinforcing the beneficial role that affordable fitness makes to physical and mental well-being.
"Covid-secure measures are working very well across the sector enabling gyms to remain open even with regional Tier 3 restrictions, encouraging us that we should be able reopen quickly once the national lockdown is over.
"The business has traded profitably during the period and we are confident that our strong financial position, with very low levels of net debt and close to £70 million of unused facilities, will provide the platform to resume our growth path once we reopen.”