GET HCM
magazine
Sign up for the FREE digital edition of HCM magazine and also get the HCM ezine and breaking news email alerts.
Not right now, thanksclose this window
Les Mills International
Les Mills International
Les Mills International
Follow Health Club Management on Twitter Like Health Club Management on Facebook Join the discussion with Health Club Management on LinkedIn Follow Health Club Management on Instagram
UNITING THE WORLD OF FITNESS
Health Club Management

Health Club Management

News

Virgin Active seeking cash injection to ride out the pandemic

Virgin Active has become the latest big-box operator to signal its intention to raise cash to buffer it from the impact of the pandemic.

The operator, which has 42 clubs in the UK, is 80 per cent owned by Brait – the investment group of former billionaire, Christo Wiese.

Brait bought its stake from Richard Branson's Virgin Group and investor CVC in April 2015, leaving Branson with 20 per cent and valuing the business at £1.3bn.

Virgin Active filed its 2019 accounts on 24 December 2020, revealing how it has been coping with the pandemic so far.

In spite of mitigating actions taken to reduce the impact of the pandemic on the business – which included senior staff taking a 20 per cent pay cut during closures – the company was forced to take an additional loan of £25m in June 2020, which was matched by a £20m capital contribution from shareholders and a £5m deferral of licence fees.

The directors reported that all interest covenants up to 2021 were waived by lenders and that the company arranged a new liquidity covenant for the period from June 2020 to December 2021.

The accounts show the Virgin Active’s balance sheet is under pressure. Borrowings leapt between 2018 and 2019, increasing interest payments from £1.18m in 2018 to £13.61m in 2019 and driving the business from a £4.67m profit in 2018 to a loss of £1.18m in 2019.

The company is now understood to be looking to raise around £50m in cash, according to industry insiders, but it’s thought this will be done through the sale of equity, rather than from loan notes, to avoid gearing the business any further.

In the financial statement accompanying its 2019 accounts, Virgin Active said it aims to be able to continue to trade with the support of its ultimate backer – Virgin Active Investment Holdings – which has indicated it will stand behind the business, however, the directors say they accept that although this is the current position, this reliance on the financial support of the holding company must be seen as representing a “material uncertainty that may cast significant doubt on the company’s ability to continue as a going concern.”

In spite of this warning note, it’s thought unlikely Wiese, Branson or the company’s banks would see any harm come to the business and that the current owners are likely to hold their nerve unless challenges escalate and lead to a fire sale.

If Brait ultimately has to sell its stake, then Virgin Active could be snapped up by one of the many private equity houses eyeing the sector for a deal.

Brait was thought to have been considering selling a slice of Virgin Active in 2019, with Morgan Stanley rumoured to be casting around for buyers, however, the pandemic has put a halt to these plans.

Virgin Active had 243 health clubs globally at the end of 2019, with more than half in southern Africa and others in Italy, Australia, UK, Singapore and Thailand.

The company has one of the most colourful backgrounds of any fitness operator, having – over the years – bought Holmes Place (2006) and Esporta (2011) as well as the bankrupt Health and Racquet Club chain (2003) and also having sold clubs to both Nuffield Health (2016) and David Lloyd Leisure (2017).

Sign up here to get HCM's weekly ezine and every issue of HCM magazine free on digital.
Virgin Active has become the latest big-box operator to signal its intention to raise cash to buffer it from the impact of the pandemic.
PTS,HAF,FIT,IND
2020/THUMB346900_205783_581089.jpg
Latest News
Industry body ukactive has joined the chorus of organisations across a number of sectors calling ...
Latest News
German fitness operator BestFit Group has acquired regional gym chain EuroFit for an undisclosed sum. ...
Latest News
The US fitness industry lost around 58 per cent of its revenues during 2020, due ...
Latest News
Speaking exclusive to HCM, Ralph Scholz and Nathalie Smeeman have confirmed that B2B trade show ...
Latest News
The Pingdemic of people receiving notifications on their phones, telling them to self-isolate because of ...
Latest News
Xponential Fitness has completed its initial public offering (IPO), becoming the second major franchised operator ...
Latest News
The Gym Group has extended its partnership with digital fitness platform Fiit, becoming the first ...
Latest News
The world's largest fitness trade fair, FIBO, has been rescheduled again and will now take ...
HCM Magazine
Product innovation
“A great atmosphere is just as important to the fitness journey as the right workout routine, says LEDSnaps’ CEO, Ian Kirby
HCM Magazine
Sponsored
With gyms reopening as the fitness industry recovers from the impact of lockdowns, members are seeking social interaction and engaging training experiences in a small group setting
HCM Magazine
Sponsored
Every gym design project should be designed from the floor up, says Physical Company’s James Anderson. He tells HCM why
HCM Magazine
Sponsored
Jo Farrier, head of commercial and resources at Active Northumberland, talks about how a strategic partnership with Technogym is changing public perceptions of council leisure facilities
HCM Magazine
Interview
‘After the rain comes the sunshine,’ says the founder and CEO of the RSG Group. He talks to Kate Cracknell about acquiring Gold’s Gym, continuing the global expansion of John Reed, and learning to live with COVID-19
HCM Magazine
Specifier
Rigs have been central to gyms for years. Now suppliers tell us how they’re evolving to meet the changing needs of clubs and clients
HCM Magazine
Research
The results from the first Moving Communities Customer Experience survey present a positive picture of overall satisfaction with local authority facilities, explains Mike Hill
HCM Magazine
HCM magazine
Premier Global NASM is setting personal trainers up for sustainable success with the launch of its online training bundle and app
HCM magazine
Fuel the debate about issues and opportunities across the industry. We’d love to hear from you – [email protected]
HCM magazine
A new study claims being physically active for 30 minutes a day, five days a week, is not enough for those who spend the rest of their time being sedentary
Featured supplier news
Featured supplier news: A new world for memberships
During lockdown clients have had more time to self-reflect than ever before. As a result, many are prioritising mental health and incorporating activity into their day to improve overall wellbeing.
Featured supplier news
Featured supplier news: How are hundreds of gym operators suddenly saving a lot of money for doing a lot less work?
Let’s talk about Orbit4 – the secret behind successful gyms.
Featured operator news
Featured operator news: Being active helps Parkwood Leisure customers save the NHS £16m
Parkwood Leisure, one of the UK’s leading public leisure facilities operators, helped prevent more than 7,000 cases of stroke, dementia, depression and type 2 diabetes in 2019, saving the NHS £16 million, a new social value report has shown.
Featured operator news
Featured operator news: Everyone Active bolsters Everyone on Demand and enters second year with five new partnerships
Everyone Active has signed a number of new deals which will see the operator strengthen its digital product offering, Everyone on Demand.
Company profiles
Company profile: Freemotion Fitness
With science and innovation at its core, Freemotion questions how we work out and then ...
Company profiles
Company profile: IONTO Health & Beauty GmbH
IONTO-COMED offers a wide range of treatment beds offering maximum flexibility and the symbiosis of ...
Supplier Showcases
Supplier showcase - Precor: The power of networking
Catalogue Gallery
Click on a catalogue to view it online
Directory
Whole body cryotherapy
Art of Cryo: Whole body cryotherapy
Hydrotherapy / spa fragrances
Kemitron GmbH: Hydrotherapy / spa fragrances
Salt therapy products
Saltability: Salt therapy products
Uniforms
Service Sport: Uniforms
Independent service & maintenance
Servicesport UK Limited: Independent service & maintenance
Architects/designers
Zynk Design Consultants: Architects/designers
Fitness equipment
Precor: Fitness equipment
Management software
fibodo Limited: Management software
Skincare
Sothys: Skincare
Lockers/interior design
Crown Sports Lockers: Lockers/interior design
Property & Tenders
Newport, Shropshire
Lilleshall Sports Academy
Property & Tenders
Pendine Sands, Carmarthenshire
Carmarthenshire County Council
Property & Tenders
Diary dates
18-19 Sep 2021
Locations worldwide,
Diary dates
21-24 Sep 2021
Messe Stuttgart, Germany
Diary dates
13-14 Oct 2021
Online,
Diary dates
01-03 Feb 2022
Coventry Building Society Arena, Coventry, United Kingdom
Diary dates
07-10 Apr 2022
Exhibition Centre , Cologne, Germany
Diary dates
15-16 Jun 2022
ExCeL London, London, United Kingdom
Diary dates
01-07 Dec 2022
tbc, Dunedin, New Zealand
Diary dates

News

Virgin Active seeking cash injection to ride out the pandemic

Virgin Active has become the latest big-box operator to signal its intention to raise cash to buffer it from the impact of the pandemic.

The operator, which has 42 clubs in the UK, is 80 per cent owned by Brait – the investment group of former billionaire, Christo Wiese.

Brait bought its stake from Richard Branson's Virgin Group and investor CVC in April 2015, leaving Branson with 20 per cent and valuing the business at £1.3bn.

Virgin Active filed its 2019 accounts on 24 December 2020, revealing how it has been coping with the pandemic so far.

In spite of mitigating actions taken to reduce the impact of the pandemic on the business – which included senior staff taking a 20 per cent pay cut during closures – the company was forced to take an additional loan of £25m in June 2020, which was matched by a £20m capital contribution from shareholders and a £5m deferral of licence fees.

The directors reported that all interest covenants up to 2021 were waived by lenders and that the company arranged a new liquidity covenant for the period from June 2020 to December 2021.

The accounts show the Virgin Active’s balance sheet is under pressure. Borrowings leapt between 2018 and 2019, increasing interest payments from £1.18m in 2018 to £13.61m in 2019 and driving the business from a £4.67m profit in 2018 to a loss of £1.18m in 2019.

The company is now understood to be looking to raise around £50m in cash, according to industry insiders, but it’s thought this will be done through the sale of equity, rather than from loan notes, to avoid gearing the business any further.

In the financial statement accompanying its 2019 accounts, Virgin Active said it aims to be able to continue to trade with the support of its ultimate backer – Virgin Active Investment Holdings – which has indicated it will stand behind the business, however, the directors say they accept that although this is the current position, this reliance on the financial support of the holding company must be seen as representing a “material uncertainty that may cast significant doubt on the company’s ability to continue as a going concern.”

In spite of this warning note, it’s thought unlikely Wiese, Branson or the company’s banks would see any harm come to the business and that the current owners are likely to hold their nerve unless challenges escalate and lead to a fire sale.

If Brait ultimately has to sell its stake, then Virgin Active could be snapped up by one of the many private equity houses eyeing the sector for a deal.

Brait was thought to have been considering selling a slice of Virgin Active in 2019, with Morgan Stanley rumoured to be casting around for buyers, however, the pandemic has put a halt to these plans.

Virgin Active had 243 health clubs globally at the end of 2019, with more than half in southern Africa and others in Italy, Australia, UK, Singapore and Thailand.

The company has one of the most colourful backgrounds of any fitness operator, having – over the years – bought Holmes Place (2006) and Esporta (2011) as well as the bankrupt Health and Racquet Club chain (2003) and also having sold clubs to both Nuffield Health (2016) and David Lloyd Leisure (2017).

Sign up here to get HCM's weekly ezine and every issue of HCM magazine free on digital.
Virgin Active has become the latest big-box operator to signal its intention to raise cash to buffer it from the impact of the pandemic.
PTS,HAF,FIT,IND
2020/THUMB346900_205783_581089.jpg

News

Industry body ukactive has joined the chorus of organisations across a number of sectors calling
German fitness operator BestFit Group has acquired regional gym chain EuroFit for an undisclosed sum.
The US fitness industry lost around 58 per cent of its revenues during 2020, due
Speaking exclusive to HCM, Ralph Scholz and Nathalie Smeeman have confirmed that B2B trade show
The Pingdemic of people receiving notifications on their phones, telling them to self-isolate because of
Xponential Fitness has completed its initial public offering (IPO), becoming the second major franchised operator
Les Mills
Les Mills
Digital meets personal with the new Virtual Player from FunXtion, experts in interactive fitness, which
The Gym Group has extended its partnership with digital fitness platform Fiit, becoming the first
The world's largest fitness trade fair, FIBO, has been rescheduled again and will now take
Rainer Schaller, founder of budget gym megabrand McFIT, says that the global fitness industry will
The most high-risk and controversial Olympics of modern times begin today (23 July) in Tokyo,
Further research into the levels of positive COVID-19 cases among those to have visited fitness
Planning approval has been granted to what is set to become one of the first
Crown Sport Lockers (UK) Ltd
Crown Sport Lockers (UK) Ltd
Let’s talk about Orbit4 – the secret behind successful gyms. Gym operators have described Orbit4
Digital fitness content provider, Wexer, is launching a new wellness resource on its connected Web
Leisure-net has revealed plans to transform its active-net business event from an annual face-to-face gathering
F45's IPO on the New York Stock Exchange (NYSE) has revealed a strong appetite from
A large health club plays a major role in tech giant Microsoft’s recently opened R&D
KA Leisure has appointed industry veteran Malcolm McPhail as its interim chief executive. McPhail, who
Aspria Holdings, owner of eight premium wellbeing clubs in Germany, Belgium and Italy, has entered
Miha Bodytec GmbH
Miha Bodytec GmbH
With gyms reopening as the fitness industry recovers from the impact of the pandemic, members
Vulnerable young people will be given opportunities to take part in sport and physical activity
Organisers of the Elevate event – scheduled to be held at London’s ExCeL on 28
Innovatise UK Ltd
Innovatise UK Ltd
1 - 20 of 11,976
HCM Magazine
Product innovation
“A great atmosphere is just as important to the fitness journey as the right workout routine, says LEDSnaps’ CEO, Ian Kirby
HCM Magazine
Sponsored
With gyms reopening as the fitness industry recovers from the impact of lockdowns, members are seeking social interaction and engaging training experiences in a small group setting
HCM Magazine
Sponsored
Every gym design project should be designed from the floor up, says Physical Company’s James Anderson. He tells HCM why
HCM Magazine
Sponsored
Jo Farrier, head of commercial and resources at Active Northumberland, talks about how a strategic partnership with Technogym is changing public perceptions of council leisure facilities
HCM Magazine
Interview
‘After the rain comes the sunshine,’ says the founder and CEO of the RSG Group. He talks to Kate Cracknell about acquiring Gold’s Gym, continuing the global expansion of John Reed, and learning to live with COVID-19
HCM Magazine
Specifier
Rigs have been central to gyms for years. Now suppliers tell us how they’re evolving to meet the changing needs of clubs and clients
HCM Magazine
Research
The results from the first Moving Communities Customer Experience survey present a positive picture of overall satisfaction with local authority facilities, explains Mike Hill
HCM Magazine
HCM magazine
Premier Global NASM is setting personal trainers up for sustainable success with the launch of its online training bundle and app
HCM magazine
Fuel the debate about issues and opportunities across the industry. We’d love to hear from you – [email protected]
HCM magazine
A new study claims being physically active for 30 minutes a day, five days a week, is not enough for those who spend the rest of their time being sedentary
HCM magazine
GM Active has launched a training programme to create a new generation of transformational leaders, as Liz Terry reports
HCM magazine
HCM People

Preston Lewis

Co-founder, Black Box VR
Game designers have figured out how to keep people unhealthily addicted to games. If only you could be the hero in a game that levelled up your life
HCM magazine
Six months on from the launch of its Kickstart programme, The Gym Group is hiring the majority of trainees, as Liz Terry reports
HCM magazine
With local authority facility management companies and councils under financial pressure due to the pandemic and issues emerging around health inequalities, will we see a trend towards councils insourcing the management of facilities? Kath Hudson rounds up views
HCM magazine
We offer medical checks which provide a precise overview of a member’s risk factors and tailor-make solutions for physical and mental health, based on actual data
HCM magazine
HCM People

Stelian Iacob

Stelian Iacob, CEO and senior VP, Therme Group
We’re seeing a much greater focus on the need to integrate healthy living into daily life and reconnect with nature and each other
HCM magazine
Featured supplier news
Featured supplier news: A new world for memberships
During lockdown clients have had more time to self-reflect than ever before. As a result, many are prioritising mental health and incorporating activity into their day to improve overall wellbeing.
Featured supplier news
Featured supplier news: How are hundreds of gym operators suddenly saving a lot of money for doing a lot less work?
Let’s talk about Orbit4 – the secret behind successful gyms.
Featured operator news
Featured operator news: Being active helps Parkwood Leisure customers save the NHS £16m
Parkwood Leisure, one of the UK’s leading public leisure facilities operators, helped prevent more than 7,000 cases of stroke, dementia, depression and type 2 diabetes in 2019, saving the NHS £16 million, a new social value report has shown.
Featured operator news
Featured operator news: Everyone Active bolsters Everyone on Demand and enters second year with five new partnerships
Everyone Active has signed a number of new deals which will see the operator strengthen its digital product offering, Everyone on Demand.
Company profiles
Company profile: Freemotion Fitness
With science and innovation at its core, Freemotion questions how we work out and then ...
Company profiles
Company profile: IONTO Health & Beauty GmbH
IONTO-COMED offers a wide range of treatment beds offering maximum flexibility and the symbiosis of ...
Supplier Showcases
Supplier showcase - Precor: The power of networking
Catalogue Gallery
Click on a catalogue to view it online
Directory
Whole body cryotherapy
Art of Cryo: Whole body cryotherapy
Hydrotherapy / spa fragrances
Kemitron GmbH: Hydrotherapy / spa fragrances
Salt therapy products
Saltability: Salt therapy products
Uniforms
Service Sport: Uniforms
Independent service & maintenance
Servicesport UK Limited: Independent service & maintenance
Architects/designers
Zynk Design Consultants: Architects/designers
Fitness equipment
Precor: Fitness equipment
Management software
fibodo Limited: Management software
Skincare
Sothys: Skincare
Lockers/interior design
Crown Sports Lockers: Lockers/interior design
Property & Tenders
Newport, Shropshire
Lilleshall Sports Academy
Property & Tenders
Pendine Sands, Carmarthenshire
Carmarthenshire County Council
Property & Tenders
Diary dates
18-19 Sep 2021
Locations worldwide,
Diary dates
21-24 Sep 2021
Messe Stuttgart, Germany
Diary dates
13-14 Oct 2021
Online,
Diary dates
01-03 Feb 2022
Coventry Building Society Arena, Coventry, United Kingdom
Diary dates
07-10 Apr 2022
Exhibition Centre , Cologne, Germany
Diary dates
15-16 Jun 2022
ExCeL London, London, United Kingdom
Diary dates
01-07 Dec 2022
tbc, Dunedin, New Zealand
Diary dates
Search news, features & products:
Find a supplier:
Les Mills International
Les Mills International