South Africa’s largest gym chain Virgin Active says it has recorded a ‘slow but steady member engagement’ with usage up to 57% since lockdown was enforced at the end of March, to combat the spread of Covid-19.
The group re-opened its facilities countrywide on 24 August, although at a 50% capped capacity to start. That has since been updated to a spatial planning model that ensures social distancing, meaning that bigger gyms can facilitate more members.
Virgin gyms boast in excess of one million members and are located in Italy, the UK, Australia, Singapore, and Thailand. The Southern African market accounts for 57% of clubs, and 36% of total revenue.
Brait, an investment holding company, has an effective economic interest in Virgin Active of 79.4%. The group noted in a financial report on Wednesday (18 November), that total revenue of £224.7 million in actual currency declined 50% year-on-year for the nine months to September, driven by the closure of all gyms due to the coronavirus lockdown.
During this closure period, Virgin Active implemented a “free membership freeze”, whereby memberships were retained without members having to make payment during the freeze period, resulting in no revenue generation for most territories.
South Africa revenue of £83.9 million (R1.7 billion), was down 51% on the prior year, Brait said.
The group said that usage levels have risen gradually across all territories as member engagement increases. Total members are down 11% since December 2019 and active members down 33% with 25% of members remaining on freeze.
Despite positive performance indicators, Virgin Active warned it is likely to take at least 18-24 months to revert to 2019 levels. A key concern remains the resurgence of a second Coronavirus wave and the restrictions imposed by governments across Europe, it said.
For Southern Africa, total membership declined to 685,000 in September, from 740,000 members in February, while active membership fell to 482,000, from 734,000 previously. Gym usage has climbed from 7% in August, to 35% in September, climbing even further to 57% in the most recent audit.
Looking ahead, the group said it will focus on further improvement on product and member experience in addition to a digital offering – to be launched soon.
Membership and usage pre-coronavirus to current
Southern Africa YTD operating performance