The Gym Group (LON:GYM) Issues Earnings Results

The Gym Group (LON:GYM) issued its quarterly earnings results on Wednesday. The company reported GBX 5.60 EPS for the quarter, Digital Look Earnings reports. The Gym Group had a net margin of 3.19% and a return on equity of 5.63%.

Here are the key takeaways from The Gym Group’s conference call:

• Strong financials: Revenue rose 8% to £244.9m and EBITDA less normalized rent increased 19% to £56.7m, with free cash flow up 10% to £38.3m and net debt reduced to £59.3m (1x leverage).
• Self‑funded rollout and returns: The group opened 16 sites in 2025, plans at least 20 (20–22) in 2026 and is targeting ~75 new sites over three years, all funded from free cash flow while mature site ROIC rose to 27% and new cohorts are tracking toward 30% ROIC.
• Confident 2026 outlook and trading: January–February revenue was +9% year‑on‑year and management expects like‑for‑like sales ~3%, central costs <11% of revenue and 2026 EBITDA (less normalized rent) to be at the top end of analysts' forecasts.
• Investment and one‑off costs increased: total cash CapEx rose to £51.2m (expansionary £33.9m), implementation costs for new member/payment systems increased non‑underlying charges (~£3.2m) and share‑based payments rose to £5.5m, which pressure near‑term reported profit.
• Cost and cash‑flow timing risks: management warns of higher like‑for‑like site cost inflation (3–4%, H1 weighted) driven by a non‑commodity electricity increase and expects no further net‑debt reduction this year due to accelerated, FCF‑funded openings.

The Gym Group Price Performance

The Gym Group stock opened at GBX 175.45 on Wednesday. The company has a current ratio of 0.19, a quick ratio of 0.27 and a debt-to-equity ratio of 295.70. The company has a fifty day simple moving average of GBX 169.41 and a 200-day simple moving average of GBX 152.30. The stock has a market cap of £307.41 million, a P/E ratio of 42.79, a price-to-earnings-growth ratio of -12.95 and a beta of 0.96. The Gym Group has a 12-month low of GBX 119 and a 12-month high of GBX 186.80.

The Gym Group announced that its board has initiated a stock buyback program on Thursday, January 15th that permits the company to buyback 0 shares. This buyback authorization permits the company to repurchase shares of its stock through open market purchases. Shares buyback programs are generally an indication that the company’s management believes its shares are undervalued.

Wall Street Analysts Forecast Growth

A number of analysts have recently weighed in on GYM shares. Royal Bank Of Canada raised The Gym Group to an “outperform” rating and upped their price objective for the stock from GBX 155 to GBX 200 in a research report on Friday, January 16th. Berenberg Bank lifted their target price on The Gym Group from GBX 200 to GBX 230 and gave the company a “buy” rating in a report on Monday, January 19th. Five equities research analysts have rated the stock with a Buy rating, Based on data from MarketBeat.com, the stock presently has an average rating of “Buy” and a consensus price target of GBX 202.

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.