Fitness First Culls More Than a Quarter of Its Australian Gyms

by News.com.au (Online Resource)

THE world's largest gym operator Fitness First has today announced more than a quarter of its Australian gyms will be culled, in a revamp of the health club operator's struggling business.

Fitness First will sell 24 of its 97 clubs after a struggle this year to deal with $890 million of debt from its UK parent company.

Fitness First Australia is a division of the global company Fitness First Group, which has been hit by weak consumer spending and the rise of budget gyms in the UK and Australia.

The group has also been subject to sharp criticisms by members for its inflexible contracts and the difficulty of cancelling memberships.

Pete Manuel, Fitness First Australia's managing director said the company was hopeful the sale of clubs across the country would give it "significant financial firepower".

"With a change in ownership of our company comes the opportunity for a full review of the portfolio of Fitness First clubs in Australia," Mr Manuel said.

"We have identified 24 clubs that do not fit our vision for the brand and these clubs are being put on the market for sale. All operators review their portfolios from time to time and this is overdue for Fitness First here in Australia."

The company said a condition of sale will be that all member and staff rights were preserved.

Fitness First Australia has engaged 333 Capital to help find buyers for the 24 clubs which may be sold altogether or individually. A condition of sale will be that all member and staff rights are preserved.



"Once the restructure is complete Fitness First will have the strongest balance sheet in the industry and our members will quickly start to see improvements in existing clubs and new clubs opening," Mr Manuel said.

The clubs being sold are spread across the country including nine in New South Wales, six in Victoria, five in Queensland, three in South Australia and one in Western Australia.



Fitness First is the largest global health club and gym operator with over a million members in over 400 clubs worldwide. Fitness First was founded in the UK in 1993 and opened its first club in Australia in 2000.

FITNESS FIRST GYMS TO BE SOLD:

NSW:
Five Dock

Granville

Tuggerah

Pennant Hills

Lane Cove

Kotara

Wollongong

Norwest

Campbelltown

VIC:

Epping

Nunawading

Chadstone Platinum

Highpoint

Malvern East

Essendon

QLD:

North Quay

Southport

Springwood

Mt Gravatt

Jindalee

SA:

Holden Hill

Hindmarsh

Marion

WA:

Balga