Budget fitness chain Pure Gym, which is gearing up for a potential flotation later this year, said earnings leapt 46 per cent in 2015 following the acquisition of southern rival LA Fitness.
Leeds-based Pure Gym, which has more than 780,000 members following the acquisition, made earnings of £28m in the year to December 31, up from £19m the previous year.
The group also got a boost from the recruitment of six-time Olympic track cycling champion Sir Chris Hoy who came on board in June as a brand ambassador. Sir Chris also took a stake in the firm which runs 150 gyms throughout the country.
Pure Gym, the UK’s largest gym operator, bought LA Fitness for an undisclosed sum, believed to be between £60m and £80. The deal last May gave Pure Gym an extra 43 outlets.
A further 20 LA Fitness outlets will be converted to Pure Gyms by the summer as part of a £30m investment programme.
Pure Gym said the acquisition boosted its presence in central London and the south east of England and it has hired new senior management as the business grows.
The group said that four of the sites it bought from LA Fitness will either be sold off or closed.
Pure Gym is expected to float on the London Stock Exchange later this year, one of few companies prepared to brave the market volatility that is expected to be produced by the June referendum on Britain’s position in the European Union. A listing could come as early as June and would value the firm at around £500m.
Chief executive Humphrey Cobbold said: “Pure Gym has had an exceptional year in which we have seen a significant increase in membership of all ages, reinforcing the demand for access to affordable, flexible and high-quality gyms across the country.
“The acquisition of LA Fitness, the strengthening of our management team, the investment in rebranding and launching new initiatives has put us on the front foot for another successful year ahead.”
The group said revenues leapt 82 per cent to £125.2m, driven by the acquisition of LA Fitness and organic growth.
Pure Gym is classed as a budget fitness business, with most of its sites open 24 hours a day. Members pay monthly fees rather than signing long contract commitments.
The firm was founded by health club veteran and executive chairman Peter Roberts, who launched the first two gyms in Leeds and Manchester in November 2009.
The company strengthened its management team last year with the appointment of Dan Glyde as chief technology officer, Stephen Rowe as chief marketing officer, Eve Sukhnandan as HR director and
Francine Davis as director of strategic and commercial development.
“Our strong financial results are built on the drive, commitment and hard work of an extraordinary team of colleagues who I am extremely proud to lead. We have added leadership capacity and new skills right across the organisation and we have done so without compromising the values and entrepreneurial character that have been the foundation of Pure Gym’s rise from start-up to market leader in just 6 years,” said Mr Cobbold.
Pure Gym has signed a three-year partnership with The Great Run Company, the UK’s biggest mass participation running series, which will see Pure Gym as a lead sponsor and provider of ‘pop-up gyms’ at running events across the UK including the Great North Run, Great South Run and the Great Manchester Run.
Since the beginning of 2016, Pure Gym has opened 18 more sites across the UK, including nine LA Fitness conversions, and now has more than 780,000 members. Pure Gym opened its 150th gym, in Oxford, at the beginning of April.