The Gym Group (LON:GYM – Get Free Report) issued its quarterly earnings data on Wednesday. The company reported GBX 3.10 EPS for the quarter, Digital Look Earnings reports. The Gym Group had a net margin of 3.02% and a return on equity of 5.35%.
Here are the key takeaways from The Gym Group’s conference call:
- Strong first-half performance: Revenue increased 10% to £133.1 million, EBITDA less normalized rent rose 12% to £30.8 million, and adjusted profit before tax increased 31% to £6.4 million. Average membership exceeded 1 million, while like-for-like revenue grew 3%.
- Management expects full-year EBITDA less normalized rent to be at the top end of the £60.5 million–£62 million analyst forecast range, with like-for-like site-cost inflation now expected at the lower end of the 3%–4% guidance range. The company also expects no cash tax until 2030.
- The Gym Group is accelerating investment while maintaining leverage at 1x, targeting at least 20 new gyms in 2026 and approximately 75 over three years, funded from free cash flow. Recent new-site cohorts and major refurbishments are tracking toward roughly 30% ROIC, and the £10 million share buyback is expected to be completed by year-end.
- The company highlighted substantial long-term market potential, including rising U.K. gym penetration, demand from younger consumers and possible benefits from GLP-1 usage. It is also exploring smaller and larger gym formats, member referrals and partnerships in the broader health and fitness ecosystem.
- New gym openings remain back-weighted in 2026, creating execution pressure for delivery teams, although management still expects to meet the target of at least 20 openings. Like-for-like membership volumes are expected to remain broadly flat as continued competitor expansion creates an estimated 1%–2% drag.
The Gym Group Trading Down 0.8%
LON:GYM opened at GBX 204.30 on Thursday. The Gym Group has a 12-month low of GBX 131.20 and a 12-month high of GBX 220. The company has a current ratio of 0.15, a quick ratio of 0.27 and a debt-to-equity ratio of 289.13. The stock’s 50 day simple moving average is GBX 204.82 and its 200-day simple moving average is GBX 192.25. The firm has a market cap of £353.98 million, a P/E ratio of 51.08, a PEG ratio of -12.95 and a beta of 0.83.
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Key Headlines Impacting The Gym Group
Here are the key news stories impacting The Gym Group this week:
- Positive Sentiment: Trading momentum improved: Sales rose by roughly a tenth after membership price increases, indicating that customers have so far accepted higher fees. The company also said Gen Z is prioritising fitness, supporting demand despite seasonal distractions such as the heatwave and the World Cup. The Gym Group feeling fit as sales jump
- Positive Sentiment: Outlook upgraded: Management raised its outlook and is considering further membership price increases, suggesting confidence in customer retention and the group’s pricing power. Gym Group upgrades outlook as Gen-Z shuns heatwave and World Cup
- Positive Sentiment: Profitability strengthened: The Gym Group reported quarterly EPS of GBX 3.10, a 3.02% net margin and 5.35% return on equity. Separate coverage highlighted a rise in first-half bottom-line profit. The Gym Group Plc Reveals Climb In H1 Bottom Line
- Positive Sentiment: Analyst support increased: Shore Capital upgraded the shares to “buy” with a GBX 280 target, while Jefferies reaffirmed its “buy” rating and GBX 250 target. Based on a share price around GBX 204, those targets imply approximately 23% to 37% potential upside.
- Neutral Sentiment: The positive operational update is partly balanced by the stock’s relatively demanding valuation and high leverage, which may limit investor enthusiasm even as earnings and guidance improve.
About The Gym Group
The Gym Group plc, together with its subsidiaries, operates a network of gym facilities under the Gym Group brand name in the United Kingdom. The company was founded in 2007 and is based in Croydon, the United Kingdom.
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