The Gym Group reported strong financial performance in the first half of 2026, with revenue rising 10% year-on-year to £133.1 million and adjusted profit before tax climbing 31% to £6.4 million. EBITDA less normalized rent (EBITDA LNR) increased by 12% to £30.8 million, while EBITDA margins expanded to 23.1%, up 50 basis points. Statutory profit before tax grew 48% to £4.9 million, and profit after tax reached £4.3 million. Free cash flow improved 10% to £27.7 million, supporting ongoing expansion and share buyback initiatives.
The company’s membership base grew by 5% to just over 1 million, with average revenue per member per month rising 5% to £22.14. Average member tenure increased to 18.5 months, while market penetration in the U.K. reached 17.6% of the population—up from 16.6% the prior year. High-value, low-cost gyms now account for 29% of U.K. gym memberships, with two brands holding roughly 80% of the market share. Total U.K. gym membership stands at 12.1 million, with annual spending at approximately £7.3 billion.
The company’s capital expenditure strategy remains robust, with £25.6 million spent in H1 2026, split between maintenance (£7.1 million) and expansion (£18.5 million). For 2026, The Gym Group expects to open at least 20 new gyms and undertake 21 major refurbishments, with total capital expenditure projected between £60 million and £65 million. Full-year EBITDA LNR is forecast to reach the upper end of analyst estimates, at £60.5 million to £62 million.
Non-property net debt rose to £58 million, though leverage remained stable at 1.0x, with fixed charge cover improving to 2.2 times. Committed facilities increased by £15 million to £117 million, comprising a £60 million term loan and a £57 million revolving credit facility maturing in June 2028. Share buybacks totaled £6 million, with £3.1 million acquired for under £1.81 per share, including £4.1 million for employee benefit trusts.
The company’s stock surged 7.77% in H1 2026, reaching $208 from $193, placing it near its 52-week high of $220. Market capitalization stood at $494 million, with a trailing P/E ratio of 51 and a PEG ratio of 0.69. Analysts rate The Gym Group’s financial health as ‘good,’ with a score of 2.72. CEO Will Shu highlighted revenue growth and cost discipline as key drivers, while CFO Luke Tait emphasized free cash flow support for expansion and buybacks.
The company’s growth strategy hinges on strategic site expansions and refurbishments, with a focus on high-margin cohorts. The 2023 cohort (six sites) is tracking toward ~25% return on invested capital (ROIC), while the 2024 cohort (12 sites) aims for over 30% ROIC. Refurbishments are expected to deliver a 30% return on capital, accompanied by an average 10% membership growth.
Analysts note potential synergies with emerging trends, such as the rise of GLP-1 medications, which could further expand the high-value, low-cost gym market. The company’s valuation metrics reflect strong operational momentum, with analysts citing robust free cash flow yields and pricing discipline.
The Gym Group’s financial resilience and growth trajectory continue to underpin investor confidence, with share price gains reflecting expectations of sustained expansion and profitability improvements.
