The Gym Group (LON:GYM) Posts Earnings Results

Key Points

• Strong first-half results: Revenue rose 10% to £133.1 million, while EBITDA less normalized rent increased 12% to £30.8 million and adjusted profit before tax climbed 31% to £6.4 million. Average membership surpassed 1 million.
• Positive full-year outlook: Management expects EBITDA less normalized rent at the top end of its £60.5 million–£62 million forecast range, with site-cost inflation toward the lower end of guidance and no cash tax expected until 2030.
• Expansion and execution focus: The company plans at least 20 new gyms in 2026 and about 75 over three years, funded by free cash flow, while completing a £10 million share buyback. However, back-loaded openings and competitor expansion may keep like-for-like membership broadly flat.

The Gym Group (LON:GYM - Get Free Report) issued its quarterly earnings results on Wednesday. The company reported GBX 3.10 earnings per share for the quarter, Digital Look Earnings reports. The Gym Group had a return on equity of 5.35% and a net margin of 3.02%.

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 Price Performance

Shares of GYM opened at GBX 205.65 on Wednesday. The Gym Group has a one year low of GBX 131.20 and a one year high of GBX 220. The stock's fifty day moving average is GBX 204.92 and its 200-day moving average is GBX 192.04. The company has a debt-to-equity ratio of 289.13, a quick ratio of 0.27 and a current ratio of 0.15. The firm has a market capitalization of £356.32 million, a price-to-earnings ratio of 51.41, a price-to-earnings-growth ratio of -12.95 and a beta of 0.83.

Analyst Upgrades and Downgrades

Several analysts have weighed in on the stock. Jefferies Financial Group reiterated a "buy" rating and set a GBX 250 target price on shares of The Gym Group in a research note on Wednesday. Deutsche Bank Aktiengesellschaft reiterated a "buy" rating and set a GBX 230 price objective on shares of The Gym Group in a research note on Friday, September 4th. Berenberg Bank upped their target price on The Gym Group from GBX 255 to GBX 295 and gave the company a "buy" rating in a report on Friday, August 14th. Finally, Shore Capital Group restated a "buy" rating and set a GBX 280 price objective on shares of The Gym Group in a research report on Friday, September 4th. Five investment analysts have rated the stock with a Buy rating, According to data from MarketBeat.com, The Gym Group presently has an average rating of "Buy" and an average price target of GBX 251.

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.