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Viva Leisure prepares for gym reopenings

Viva Leisure prepares for gym reopenings
May 25, 2020

With its facilities closed since 25th March, Viva Leisure has advised of its plans for reopening its sites upon the easing of Coronavirus restrictions

In a release today, the ACT-based business noted that it has drawn down almost half its cash reserves during the COVID-19 lockdown, putting some of those funds for revamping its gyms for future business.

The company advised that $5 million had been spent on pre-closure creditors, as well as the acceleration of refurbishments, completion of sites under development and business improvements.

After listing on the ASX in mid-2019, the Canberra-based group has expanded from 33 to 83 locations through expansion of its brands including Club Lime, Groundup, Gymmy Pt, Hiit Republic, and Cycle Life and acquisitions, most recently of FitnFast clubs earlier this year.

The release highlighted the following upgrades:

• Five of the 10 Queensland locations will re-open fully refurbished and with upgraded equipment;
• Four locations currently under development/fit-out, two of which will be completed before re-opening, with the remaining two being in the Melbourne suburb of Nunawading (to be completed in July 2020) and the Sydney suburb of Pyrmont, Sydney (to be completed in late August 2020 at this stage)
• Two new locations have been completed during the shutdown and are ready to open (Gungahlin Club Lime in the ACT and Wagga Wagga Hiit Republic in NSW).

With the ACT Government having approved commercial pools to open, the company's Australian National University aquatic facilities already opened on Saturday while its hydrotherapy facilities at the Canberra International Sports & Aquatic Centre are expected to open today.

Scheduled easings of restrictions on gyms in the ACT (30th May), Queensland (12th June) and Victoria (22nd June) mean 70% of Viva Leisure's locations have confirmed opening dates, although the NSW Government has yet to make an announcement on when gyms can again open for business.

It is expected that Stage 2 will continue to have restrictions in place, likely to be 20 members within the gym, or different parts of each gym at one time, the final details are not yet known.

The company notes while any restriction on members is not ideal, it has implemented systems including bookings and automated people counters which restrict entry into the facility to assist with this short-term restriction. Members will be able to determine how busy each location is before attending outside of booked times.

Stage 3 of easing restrictions contemplates allowing 100 people in a gym at the same time, which would mean Viva can operate most facilities at full capacity.

Commenting on the group’s plans, Viva Leisure's Chief Executive and Managing Director Harry Konstantinou, stated "as we commence the tenth week of the mandatory shutdown of our clubs, our team has been working overtime to ensure we are ready to open our doors as soon as permitted to do so.

"It is promising to know that over 70% of our locations could be open within the next three to four weeks, albeit with some initial restrictions.

"The feedback from members we have received during this shutdown is encouraging, with a large percentage of members keen to get back into it."

Noting that data from reopened overseas clubs is encouraging, with the majority seeing higher than expected attendance and new member signups, Konstantinou (pictured above) added “while the mandatory shutdown is not something any business wants, it has allowed our team to reset, recharge and be ready to go.

"As expected, significant opportunities are now in front of us, and with our strong balance sheet, we will capitalise on them."

Viva has also successfully renegotiated deferrals or reduced rental payments for 25 locations, resulting in a saving of $444,000 per month on cashflow for up to six months.

Related Articles

24th May 2020 - Victorian Government announces opening of gyms and ski fields from 22nd June

23rd May 2020 - Fitness Australia says governments should put peoples’ health and wellbeing above a drink at the pub

22nd May 2020 - Canberra gyms prepare for post Coronavirus reopening

21st May 2020 - Genesis’ reopened Western Australian clubs deliver supervised group fitness

21st May 2020 - Fitness Industry launches comprehensive operations framework for safe reopening of gyms

14th May 2020 - Experienced fitness operator addresses clubs’ ongoing hygiene and business challenges

13th May 2020 - Life Fitness helps guide safe reopenings of fitness and wellness centres

11th May 2020 - Fitness Australia launches Service Excellence Program

8th May 2020 - Fitness Australia welcomes Federal Government’s Coronavirus relaxations that focus on importance of exercise

6th May 2020 - Fitness Australia survey finds Australians keen to renew gym memberships

4th May 2020 - Fitness and wellness Industry organisations publish reopening guidance

1st May 2020 - Fitness Australia report shows massive impact of Coronavirus closures on the industry

28th April 2020 - Facing up to the Fitness Industry’s post lockdown challenges

23rd April 2020 - Planning for a post Coronavirus fitness industry that will not be the same

22nd April 2020 - Australasian fitness industry looks to post Coronavirus operations

7th April 2020 - Two-thirds of the world’s fitness clubs are currently closed

26th March 2020 - Viva Leisure sheds more than 1,000 staff in 48 hours

2nd March 2020 - Viva Leisure reports ongoing growth and reveals new boutique brand

14th February 2020 - Viva Leisure opens new sites and completes Fit n Fast Health Clubs acquisition

2nd December 2019 - Viva Leisure looks to raise new capital as it announces acquisition of 13 Fit n Fast clubs

12th November 2019 - Viva Leisure expands Queensland operations with addition of two more Healthworks clubs

28th August 2019 - Viva Leisure 2018/19 financial results exceed prospectus forecasts

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