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Hi guys - this is from UK active they represent 3500 fitness entities, hope you guys get more out of it than I did! Clearly they are working very hard with government in the least..............
https://www.ukactive.com/news/ukactive-sets-out-four-stage-strategy-to-support-reopening-of-physical-activity-sector/
Article in Health Club Management Magazine (20/05/20):
‘A survey by Savanta ComRes, in partnership with Sport England, has studied the impact of the coronavirus pandemic on attitudes and behaviours towards physical activity.
Findings included that 87 per cent of current gym members said they are likely to resume their membership when facilities reopen.
Encouragingly for the fitness sector, 27 per cent of people who are not currently members at a health club said they are also likely to join.‘
Full article here: https://www.healthclubmanagement.co.uk/health-club-management-news/COVID-19-Savanta-ComRes-Sport-England-coronavirus-physical-activity-gym-health-club-ukactive-Huw-Edwards/345528
It's not hard to understand. Prior to this crisis The Gym Group was in a great financial position with a share price of £3 and likely to grow well beyond that. It's hardly held up as strong as you're saying, it's currently well over 50% lower. Looking at the fundamentals and the strength in comparison to the other big gym chain in the UK (debt riddled Pure Gym) I expect it to be back where it was in 12-18 months.
That's a 100% return... not bad eh?
https://www.hl.co.uk/shares/shares-search-results/g/gym-group-plc-ordinary-1p/broker-forecasts
‘Gym bunnies could be back on the treadmill as soon as July‘ according to The Times (21/05/20).
No resolution to confirm 2019 Dividend payment. Resolution to allow sale/purchase of Director Shares by the Company at max 105% market. Not much else on the agenda. I expect Bojo’s update (expected this Sunday?) will be far more impactful. Gyms were trading with social distancing measures pre-lockdown e.g. capped and actively managed occupancy, closure of shower facilities, every other machine closed, nighttime closures with deep cleaning etc. Whether these are sufficient in light of improved understanding of transmitting of the disease I’m not sure. I have seen gyms offering/developing online content, which is a plus both during and post lockdown surely - the more strings to your bow the better your chances of successful recovery? The government smartphone app may provide an opportunity to screen entrants on arrival?
The end of the market this gym caters to will not find paying a gym membership as a necessity.
It's like taking membership out in January with all good intentions, miss a few sessions then not return for another 11.5 months. Breeding ground for virus, not possible to clean equipement continously at peak hours or any.
"Put the weights back" - still seems a hard concept to grasp.
Not sure why this price has held so strong makes no sense.
Not this year.Breeding ground for bugs.Need to employ an army of cleaners.Just not going to happen.
I assume Gym’s will be last to re open . Hopefully by Aug ??
https://www.google.co.uk/amp/s/www.telegraph.co.uk/health-fitness/body/will-gyms-re-open-britain-will-safe-visit/amp/
BBC news says, Gym and leisure centre bosses say they face being evicted during the coronavirus crisis over non-payment of rent.
Not sure how this can affect the position of Gym Group. It is definitely tough times ahead
I’ve reduced my holding. I’m concerned about the level of debt here and auditors going concern note in the accounts last year.
We can suppress the disease but only when have a vaccine or herd immunity is sufficient can life go back to normal . 2021 start of I would guess . Otherwise we could end up back at square one .
Wonder if gyms will be allowed to re open but with restrictions in place ? Same for restaurants perhaps ?
I am quite heavily invested in the gym group makes up a large portion of my portfolio. However I am concerned about when gyms may re open .
I cannot see life going back to normal for a while . Social distancing is here to stay until a vaccine found or herd immunity is built up in the population.
Anyone got any views as to when gym’s May re open ? Can gyms re open but follow social distancing guidelines is that even possible ?
Now then london.
Tbh I dunno when it’ll be gone for good. But diseases don’t tend to go away, once a ?vaccination has been developed then I guess lots of people will be safe.
And yes I think it will very much be a phased approach. A slow progression from the current situation to a new kind of normal.
I’m in GYM for the long term. Very hopeful that over time we’ll see good growth or even a private equity buyout.
But that’s IMO
Echo1 all good and valid points.
I agree, two questions;
- when will COVID ‘go away’ for good?
- will it be a phased approach. We no longer have to self isolate but keep an eye on hygiene etc.. as warnings it can come back
I reckon we are looking at around September before it’s gone for good, which will rule out the ‘summer beach body’ trade but will be a lot of people unfit due to covid.
I like the Gym, I sold at 275 a few months back - the small profit I make pays for my yearly membership cost. But I will be buying here again - the brand is solid and this dip will rise once the Covid19 is sorted. Strong buy imho
I think you’re right when you talk about news lows. I’m not going to average down at the current price. I think we’ll be back below £1 at some point.
I don’t think however it’ll be a case of ‘covid is over’. I think we’ll see a slow transition back towards normality.
For example - gyms may reopen but facilities will be restricted and the emphasis on hygiene will be very high. And the gyms will need to police this very strongly.
Any thoughts?
I like this company, and I like the gyms.
Once we come out of this mess, this will be a ‘post-Christmas’ affect I think, as so many people will be looking to get back into shape.
BUT the question is, how low will it go until then? Customers will only come back when there’s confidence that COVID is over.
So, it’s probably got some more lows coming but will bounce back hard when COVID is no more.
Exactly, Massiha1372. I think there's a fantastic management team in place here who knows what they are doing.
There should be significant up-side here in the long term. Short term - it's dependent on how this virus develops.
I don't buy that the company will collapse - it isn't over-leveraged - the Board has been good in how they target expansion and have taken on sensitive debt.
This, Alliance Pharma and Breedon Aggregates - I rate the Board highly. There's other companies I haven't considered with solid Board though.
I wish we could top up ISAs now, lol.
@Farhantahir, I was thinking along the same lines.
Im actually a member myself and in the email that they announced the gym closures, they said any outstanding balance from March would be carried over to whichever month the gyms reopen which I think is a neat trick to ensure people get into the habit of going back to the gym (almost would feel free) and hopefully it will help the company in retaining customers who got too comfortable while at home.
I for one cant wait for the gyms to re-open, and the same applies to almost all my gym buddies. Need to work double to get in shape for summer (if Corona gets sorted by then).
The fundamentals of the company don't change. I actually think membership numbers will rise, post Covid-19. Lots of us, including me, will have put on a ton of weight due to lockdown. I've heard in various whatsapp groups from people that don't go to the gym now wanting to join.
Main thing however is that it's dependent on how quickly things are brought under control.
Short term gain, long term money should be made here. But I agree, its a steal at current levels. ISA topups are possible in 2 weeks - that's when i'll buy my first shares here :).
Good reading this board some days
I’d say at current levels this is an absolute steal.
But it’s going to take considerable time to get back to 300p.
And i invested at 286p
How will it collapse today?
Let's say they generate 16m in revenue a month (it's probably less though). If it's shut for 3 months, its 48 million. Some government funding will cover losses. Also insurance might cover loss of income through pandemics.
Otherwise, yes it's a big hit - but once they're open again, they will be mobbed - lots of people will get fat sitting at home all day.
I'm not invested here. I was interested at 2.50 a share. Definitely interested here now. :)
No visibility now on re-opens will seriously depress the price. Dreadful situation for employees , the biz and the country as a whole
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