The Gym Share Discussion Threads

[rathean] 18/7/2019 16:45

Good to see a close above 260. Fwiw the last up trend lasted the better part of 18 months here imo dyor ofc.

[turbocharge] 18/7/2019 12:13

Two large buys of 200,000 @ 258p this morning

[masurenguy] 17/7/2019 14:26

Shareprice at a 6 month high today.

[rathean] 17/7/2019 13:41

100000 shares purchased in one transaction, impressive faith in the business at 255p after a strong trading update, looking at circa 300 before top-slicing again imo dyor ofc.

[thomshrike] 16/7/2019 12:12

My point was not about CFO but rather FCF, but I think you stripped out M&A capex from FCF anyway. Thanks.

[manuelbeanster] 15/7/2019 17:41

Thank you very much for you answer Thomshrike. Very enlightening. Could you please explain what you meant by taking into consideration the past acquisitions and the generation of CF? As far as I can see, those acquisitions can impact the CFO's in one of two ways. Higher interest expense and maybe some negative changes in inventory. Were you referring to these? Thank you for your help.

[thomshrike] 15/7/2019 16:52

Manuel, thank you for your write-up. A few snippets from me:
- don't forget that GYM did a couple of acquisitions in recent years (and raised some money to finance one of them), so that you have to take that into consideration when looking into past CF generation (and number of shares).
- BFIT's ownership is a double-edged sword. René Moos is always very adamant he won't sell anytime soon, but 3i's stake is seen as an overhang. Conversely, GYM's shareholding structure, where John Treharne holds only c. 3%, could turn it into a takeover target.
- BFIT does have plenty of growth potential in France and Spain but they do not have the financial flexibility to think about other countries any time soon (such as Italy).
- keep in mind that both companies will have seen their BS ratios change in 2019 thanks to IFRS 16.
- I am curious about how different strategies executed by these companies will play out. eg: GYM's units have different prices depending on location and utilization, whereas BFIT has a flat price regardless.

Overall I would see both companies as attractive. Their business model continues to take market share and scale helps to increase the competitive moat and ultimately market share. BFIT will grow more but with much more risk (difficult to believe that you can build 125+ gyms per year with no hiccups...) and is also much more expensive, so I also prefer GYM.

[manuelbeanster] 15/7/2019 15:57

Hi guys, I'm new to this discussion so I wanted to share with you my latest write-up where I compare Basic-Fit to The Gym Group. I hope you guys like it. Any feedback is welcome. Thanks guys. hxxps://allinstocks.com/basic-fit-vs-the-gym-group/

[turbocharge] 15/7/2019 12:54

Conference call after the update:

[turbocharge] 12/7/2019 11:57

The Gym Group expects revenue to jump 27% amid rise in membership numbers
12 July 2019 | 08:46am

Low-cost gyms operator The Gym Group said it expected revenue to increase by more than quarter in the first half of the year on the back of rise in membership numbers. For the half-year ended 30 June 2019, revenues grew 26.9 % up to £74.0m from a year earlier as membership numbers increased by 10.6% to 796,000. The average Members for the first half of 797,000, were up 20% from 664,000 a year earlier. The company grew its gym estate grew to 165 in the half, up from 147 last year, with eight new site openings during the period. 'The platform we have created means we can continue to expand rapidly and we expect to meet our rollout target of 15-20 gyms for 2019 with one small box gym to open later in the year. I am excited about the potential of the Company and look forward to delivering another year of strong profitable growth for shareholders,' the company said.

[dtaliadoros] 12/7/2019 10:00

Another brilliant set of results. I've said it before and will say it again. This stock is a no brainer on the research side. Just walk into anyone of their gyms to see how busy they are. One of my favourite stocks in my portfolio.

[shauney2] 12/7/2019 08:17

Peel Hunt reiterated a 'buy' rating and target price of 350p, saying gym membership numbers were ahead of its forecast. The broker also held its pre-tax profit estimate for the 2019 financial year at £20.1mln but expects pre-tax profit to nearly double over the next three year.

"For clarity, the company expects all forecasts to switch to an IFRS16 basis in the autumn, but that should not disguise the pace of the company’s outperformance.

[turbocharge] 12/7/2019 08:17

Masurenguy, 26 Jun 2019:

"Recent broker share price targets:
19 Jun Barclays Capital: 300.00 - Upgrades
06 Jun Peel Hunt: 350.00 - Reiterates
30 May Numis: 313.00 - Reiterates
01 May RBC Capital Markets: 320.00 - Outperform"

These targets do seem pretty accurate. Here we come 300+....

[masurenguy] 12/7/2019 08:16

Solid update with average members for H1 2019 of 797,000, up 20%, and total revenue up 26.9 % to £74.0m. Premium membership Live It increased to 16.9% of total membership compared to 11.7% in December 2018 with a 5.6% growth in average revenue per member per month. Peel Hunt have reiterated their price target of 350p once again this morning.

[turbocharge] 12/7/2019 08:12

Great update. Happy to continue holding for the longer term.

#337, 26 Apr 2019: "Turbocharge Reiterates GYM as a long term solid hold."

#308, 19 Mar 2019: "One to hold for the longer term :)"

[thomshrike] 12/7/2019 08:12

Average revenue per member per month up 5.6% YOY in H1... To think that the stock plummeted in January due to pricing concerns...

[rathean] 12/7/2019 07:59

Happy with that, solid growth improving margins and a cash rich business. Looking forward to seeing the impact the smaller box gyms have reaching new urban markets. Market consolidation should not be ruled out, will Gym continue to be the aggressor or the subject of bigger fish? All imo dyor ofc.

[mount teide] 12/7/2019 07:14

Highly encouraging Trading Update - new memberships and average revenue per member continues to grow strongly. Average membership fees are still materially below their major competitors and the market leader.

Holding 24% of the low cost market and by far the largest market share in London - GYM Group has positioned itself as a major player in a maturing low cost market in the early stages of consolidation.

[masurenguy] 05/7/2019 13:04

Liberum has issued a Buy recommendation on GYM today with a price target of 330p.

[masurenguy] 26/6/2019 08:22

The shareprice rise continues - up by 25% over the past 15 weeks.
Recent broker shareprice targets:

19 Jun Barclays Capital: 300.00 - Upgrades
06 Jun Peel Hunt: 350.00 - Reiterates
30 May Numis: 313.00 - Reiterates
01 May RBC Capital Markets: 320.00 - Outperform
These are now begining to look much more realistic !

NB: Shauney - just ignore the troll ONJohn who has absolutely no idea what he is talking about. !

[shauney2] 24/6/2019 16:46

For what reason?

[onjohn] 24/6/2019 16:22

Placing imminent imho

[thomshrike] 19/6/2019 13:42

Trading update should come only in mid-July. Last year it came out in mid-June because it coincided with the EasyGym acquisition.