PRODUCT NEWS
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| Gym Group brings in Wais Shaifta and Rio Ferdinand as non-execs and eyes expansion |
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| 15 Jan 2021 . BY Tom Walker |
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| Rio Ferdinand has become a non-executive director for The Gym Group / Shutterstock/Stefan Constantin 22 |
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I've been impressed at how The Gym Group is breaking down barriers to fitness and I look forward to contributing as a director to the next stage of growth
– Rio Ferdinand |
The Gym Group has brought in Rio Ferdinand and Wais Shaifta as non-executive directors, signalling a broadening of its remit, new horizons and an intention to continue to refine and expand its member offering.
Shaifta is currently CEO at Europe-wide digital healthcare company, Push Doctor, which works in partnership with the NHS to connect patients with clinicians. He was previously director of global operations at online beauty marketplace, Treatwell (formerly Wahanda), and prior to that spent six years at Just Eat, where he was responsible for group operations strategy.
His appointment will strengthen the board in developing its health- and wellness-related services, as well as its secondary spend operations, while his global experience would help the company in delivering international expansion – an option which is thought to be on the cards.
Footballing legend, Rio Ferdinand, has built a business career in broadcasting, charity and champions areas such as social housing and youth development.
Through the Rio Ferdinand Foundation, he works collaboratively with young people and communities to deliver 'progression pathways' aimed at ensuring young people are socially mobile and empowered to be independent.
An author and filmmaker, Ferdinand is a passionate advocate for fitness, mental health and wellbeing and diversity.
The Gym Group announced the appointments alongside the release of its pre-close trading update for the year to 31 December today. The company said it cut its monthly cash burn to around £5m during the January lockdown – down from £6m during the November shutdown – thanks partly to it utilising grant support recently announced by the government.
The budget chain says it lost 45 per cent of its trading days during 2020, which resulted in total revenue falling by nearly half to £80.5m, down from £153.1m in 2019.
During 2020, the group lost more than 200,000 members, with total year-end membership across its 184 sites standing at 578,000 – down from 794,000 in December 2019, with 20 per cent of those being students, due to disruptions in the academic year.
The take-up of LIVE IT – its premium pricing product – has grown strongly and now has a penetration of 22.5 per cent of total membership (up from 18.9 per cent in December 2019).
The group is also looking for further expansion opportunities, after opening eight new sites during 2020. It is already on-site for three new openings – in York, Sydenham and Cambridge – and is planning more.
"We continue to see an opportunity to access excellent new sites at attractive rents," said Richard Darwin, The Gym Group CEO.
"We are building a strong pipeline for 2021 and beyond and we will continue to progress new leases during this current period of lockdown. We will determine the timing of the rollout programme once there is greater visibility about a reopening date for gyms."
Commenting on the overall picture and the state of the industry, Darwin added: “2020 has been a challenging year for our business, our members and our colleagues.
"Through the outstanding work of our team we provided a COVID-secure exercise environment for our members and demonstrated the resilience of our business model by trading profitably when gyms have been open.
"Our cash management during the pandemic has ensured we ended 2020 with manageable levels of debt and significant liquidity,” he said.
The group has now begun talks with lenders over reviewing covenant tests, relating to its £100m bank facility.
"At a time when health and fitness has never been more important to the nation, we are ready to emerge from the pandemic and take advantage of the many opportunities available us,” said Darwin.
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