The Gym Group to open new branches in 2021 despite pandemic hit

The Gym Group has said it plans to expand with new branches in 2021, despite predicting it will burn through around £6 million each month amid the second English lockdown.

Shares in the company jumped after it said the pandemic is helping to create an “opportunity to access attractive potential new sites” as rivals feel the impact of the enforced lockdown.

Gyms and leisure centres are among sites which were forced to temporarily close from Thursday until at least December 2.

The group, which has shut the doors to its 167 sites in England, told investors it opened four new gyms in August and expects to open three new branches – in Chichester, York and Sydenham – in the first quarter of 2021.

It is “building a pipeline” of potential new opening for the rest of the year, with leases agreed for four sites and negotiations still taking place for several more, it said.

The Gym Group said its gyms have been visited more than 10 million times since reopening on July 25 following the first lockdown.

It said membership numbers also bounced back after re-opening, although they remain below pre-pandemic levels.

Richard Darwin, chief executive officer of the group, said: “In the three months since reopening, the Gym Group has seen good levels of membership demand reinforcing the beneficial role that affordable fitness makes to physical and mental well-being.

“Covid-secure measures are working very well across the sector enabling gyms to remain open even with regional Tier 3 restrictions, encouraging us that we should be able reopen quickly once the national lockdown is over.

“The business has traded profitably during the period and we are confident that our strong financial position, with very low levels of net debt and close to £70 million of unused facilities, will provide the platform to resume our growth path once we reopen.”

Shares were 18.3% higher at 162.4p after early trading on Monday.