UK budget gyms have surged in popularity over the past decade, despite COVID-19, as consumers grow health-conscious. The Gym Group is the only listed play in the growing UK fitness sector.

Today, annual revenues for the UK Health & Fitness industry are £5.9bn. PWC estimates the UK could support 600-850 more low-cost gyms. At full potential, these gyms would account for 30-40% of all UK gym members.

The company swung to profit in the first half of 2024 driven by the continued growth in low-cost gym sector the new management team's 'Next Chapter' strategy.

Even though The Gym Group remains the lower priced offering in the market, as all players raise prices it may lead to customers cancelling their membership.

High fixed costs make the Gym Group vulnerable to disruptions like COVID-19, as they can't easily reduce expenses when memberships drop.

The Gym Group faces strong competition from Pure Gym, which plans to open over 70 new sites in 2025. Gym Group, however, is less geared and is entirely focused on the UK market.