Planet Fitness has posted strong results for Q2 2023, with revenues up US$62.5m on 2022 (27.6 per cent) to US$286.5m.
Adjusted EBITDA increased US$29.8m to US$118.9m from US$89.1m in Q2 2022.
The company opened 26 new Planet Fitness locations in the three months to June, including three corporate-owned and 23 franchisee-owned, bringing the total to 2,472 (at 30 June 2023). It expects to open a further 160 locations by the end of 2023.
Looking at the year to date, revenues increased to US$379,532 for the first six months of this year, versus US$307,369 during the same period in 2022.
Planet Fitness ended its second quarter with a total of 18.4m members – CEO, Chris Rondeau, said “All generational groups have surpassed their pre-pandemic penetration levels and more of our members are working out more frequently. In addition, previous members are rejoining at a faster rate than they did pre-pandemic,and they’re staying longer.
“Q2 was our eighth straight quarter with lower year-on-year cancellation rates,” he explained.
Earnings per share are on track for the year and expected to increase by around 34 per cent – the company had previously said they would be between 33 and 36 per cent and most brokers flagged Planet Fitness as a ‘buy’ on this news.
Rondeau said the company repurchased US$100 million in shares during the second quarter of 2023, as a result of the strong balance sheet and “confidence in the future.”
The company expects 2023 net interest expenses to be in the low US$70m range this year, against its previous forecast of US$75m.
Rondeau said Planet Fitness will be responding to the global economic situation by making adjustments to its forecasts, although these are expected to be very slight.
The company has met or exceeded its revenue estimates three times over the last four quarters (see below), so the move is to keep in line with this objective.
Revenue is expected to increase by 12 per cent against a forecast of 13 per cent and EBITDA to increase by 17 per cent against forecasts of 17-18 per cent. Net income is expected to increase by around 30 per cent against the 30-33 per cent forecast.
“While we’re bringing down our near-term growth forecast due to external headwinds, the fundamentals of the business remain strong, as evidenced by our Q2 results,” he said.
QUARTER ENDING ESTIMATES
Actual and met/beat/missed
At 31 March 2023 Estimate: 0.46, actual: 0.41
At 31 December 2022Estimate: 0.47, actual: 0.53
At 30 September 2022 Estimate: 0.38. actual 0.42
At 30 June 2022 Estimate 0.38 actual 0.38