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LA Fitness issues results early and defies market downturn
Following a profits warning issued by health club operator Fitness First, LA Fitness has issued its preliminary results early, reporting continued growth and increased turnover.
Results for the year ended 31 July 2002, announced today (7 October) have shown turnover up 67 per cent to £47.6m, operating profit up 55 per cent to £9.3m and pre-tax profits up 40 per cent to £7.8m.
The company opened 16 clubs over the year, including its first outside the UK, in Barcelona, Spain. Two more UK clubs have also opened since the year end.
LA Fitness now has 55 clubs, with 12 more in the construction stage, including a second Spanish site, in Madrid and seven further sites have been secured. 'The board looks forward to the future with confidence,' said chair, Peter Jacobs. 'We believe we can comfortably grow to in excess of 100 clubs.'
Joining fees still account for 4 per cent of turnover, but like for like sales at the 24 clubs open throughout the last two years have increased by 9 per cent, with the company saying it is continuing to develop opportunities for additional revenue, including private training, merchandising and advertising. Income from sources other than subscriptions and joining fees has grown by 54 per cent and now represents 12 per cent of income.
Retention rates rose from 68 per cent to 70 per cent, with the operator now boasting 129,510 members at 31 July 2002 compared to 88,630 the previous year.
The proposed final dividend was 0.8p, giving total dividends for the year of 1.2p per share, a 20 per cent increase on the previous year.
Chief executive, Fred Turok, said: 'We consider that our segment of the health and fitness industry is a long way from saturation. Our business model continues to perform robustly, new site availability is strong and the demand for conveniently located and affordably priced clubs demonstrates that we remain less exposed to the current economic environment.' Details: www.lafitness.co.uk