An individual works out at Planet Fitness as they re-open at 25 % capability in Boston’s Dorchester on Feb. 1, 2021.
Jessica Rinaldi | Boston Globe | Getty Images
Planet Fitness shares surged double digits after beating expectations on each strains for the third quarter and elevating its outlook for the yr.
Here’s how the company did in contrast with Wall Street analysts’ expectations, in keeping with LSEG, previously identified as Refinitiv.
- Earnings per share: 59 cents, adjusted, vs. 55 cents anticipated
- Revenue: $277.6 million vs. $268.2 million anticipated
For the quarter ended Sept. 30, Planet Fitness posted a revenue of $39.1 million, or 46 cents a share, up from $26.9 million, or 32 cents a share, a yr earlier. Adjusting for one-time objects, the company reported per-share earnings of 59 cents.
Revenue jumped practically 14% to $277.6 million.
The company stated it now expects to submit 14% revenue progress for the yr, up from its earlier steering of 12% and better than analysts’ expectations of 11.6%.
Interim CEO Craig Benson led the company’s quarterly earnings name with analysts and traders following the abrupt departure of former Chief Executive Chris Rondeau.
The health club chain’s board ousted Rondeau in mid-September, beautiful each traders and workers. The company did not share extra particulars on his departure throughout the earnings name, however Benson confirmed the seek for his successor is “going effectively.” Planet Fitness shares have recovered since Rondeau’s departure, however stay down greater than 20% yr thus far.
Benson outlined Planet Fitness’ forward-looking progress technique within the company’s press launch.
“We’re adjusting our store-level return mannequin to additional enhance the attractiveness of opening and working Planet Fitness shops in a brand new macro-environment,” Benson stated. “The modifications embrace lowering sure capital investments by extending the timing for changing tools and finishing remodels, to set us and our franchisees up for continued long-term sustainable progress.”
New and current franchise house owners obtained up to date settlement particulars in mid-October that included key modifications to the enterprise construction, together with:
- an elevated franchise settlement from 10 years to 12 years to get rid of the preliminary $20,000 franchise charges.
- shortening grace intervals for franchisees from 12 to 6 months.
- reequip intervals prolonged to unencumber capital and cut back retailer spending.
“We assume finally this was the perfect set of modifications that we might develop to enhance to unencumber some money,” CFO Tom Fitzgerald stated on the decision. “To spend money on new retailer progress, enhance the shop returns of these new shops.”
Fitzgerald additionally confirmed the company is experimenting with value will increase for its “Classic Membership,” from $10 to $15, in additional than 100 take a look at markets.
“At the top of the day, our standards is we do not wish to sacrifice member progress,” he stated.
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