The number of Gym (GYM) sites continues to accelerate, with the group adding another 21 of its own-brand outlets to the estate last year, as well as a further 18 acquired from rival Lifestyle Fitness. The conversion of these acquired sites to Gym branding continues, and analysts have been cheered to see return on capital employed (ROCE) across the group’s existing 'mature' sites stay flat at 32 per cent. Mature sites are defined as having been open for business for 24 months or longer.
But those same analysts are a little more circumspect where the cash margin is concerned, down 30 basis points to 30.6 per cent, with the resultant profit of £28m slightly short of broker Numis’s projections. The reason seems to lie in the mature sites, where average cash profit slipped from £476,000 to £461,000 year on year. But the group is confident this margin pain will be short term as more new sites come on stream and the launch of a new premium membership – which carries a higher price – gains better traction.
Numis still forecasts pre-tax profit of £15.6m for 2018, giving EPS of 9.4p, compared with £12m and 7.4p in 2017.
| GYM GROUP (GYM) | ||||
| ORD PRICE: | 253p | MARKET VALUE: | £325m | |
| TOUCH: | 252-253p | 12-MONTH HIGH: | 265p | LOW: 170p |
| DIVIDEND YIELD: | 0.5% | PE RATIO: | 45 | |
| NET ASSET VALUE: | 94p* | NET DEBT: | 31% | |
| Year to 31 Dec | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
| 2013 | 35.7 | -9.0 | -16.6 | nil |
| 2014 | 45.5 | -9.4 | -18.0 | nil |
| 2015 | 60.0 | -12.4 | -19.0 | nil |
| 2016 | 73.5 | 6.9 | 4.5 | 1.0 |
| 2017 | 91.4 | 9.2 | 5.6 | 1.2 |
| % change | +24 | +32 | +24 | +20 |
| Ex-div: | 24 May | |||
| Payment: | 14 Jun | |||
| *Includes intangible assets of £62m, or 48p a share | ||||
