This Boutique Fitness IPO Just Increased Its Revenue By 63%

F45 Training (NYSE: FXLV) recently released its results for fiscal year 2021 and the numbers were quite impressive. In this clip from “The Health & Fitness Show” on Motley Fool live, recorded on March analyst Sanmeet Deo takes a closer look at the global fitness franchiser’s rising revenue and positive outlook for 2022.

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Sanmeet Deo: F45 Training is essentially a global fitness franchisor offering functional training and a 45-minute high-intensity circuit-style workout class designed for all fitness levels. Imagine if you are going to take boot camp classes. It’s like a boot camp course. You use weights, you use your body, you do high intensity interval training. It’s in a short class format that you finish and then walk out. It is a small box format. I think the square footage of the studios could be less than 2,000. I don’t know exactly.

It started in Australia actually, so most of the sites are in Australia. I remember following this because having been in the fitness industry I hear about a lot of different shops so I’m always curious what they are up to. I don’t know if you’ve ever heard of Fit Body Boot Camp, it’s another boutique franchise that’s a boot camp style training class. But they are private, they never became public.

It was interesting. One thing that caught my eye was that when I heard about them, Mark Wahlberg actually took a very big investment. As I understand they were supposed to go SPAC and then they canceled that and just went with the initial IPO. They went public, I believe it was late 21 or summer 21.

They were in Australia and other countries and now the United States is their big growing market. It’s very interesting. They recently announced their results for fiscal year 2021. Revenue was $134 million up 63%, adjusted EBITDA was $52 million, up 104%. Their same-store sales increased by 12% worldwide, 42% of sales in the United States

System-wide sales, i.e. sales of all units and the entire system. All the sales they generate. Now keep in mind this is a franchisor so it takes a royalty on the sales generated by these franchises so the system wide sales is only the total sales of all these units. Then, the F45 franchisor takes royalty income from this proportion. Usually 7%, 6%, 7%, something like that. These sales also increased sharply by 31% worldwide and 103% in the United States.

They have a very good gross margin, 75%. These have improved since last year. Next, their adjusted EBITDA margin is also quite strong at 39%, which is an increase from last year. Their outlook for 2022, they envision 1,000 net initial studio openings. Revenues of $255-275 million, well above the $134 they reported in 2021.

They’re looking at $90-100 million adjusted EBITDA for 2022. That’s a big increase, around 80%, I think that’s above their $52 million from 2021. They’re looking to really grow next year and they’re coming out of the pandemic, growing really strong and they’re over the pre-pandemic levels they’re at.

Sanmeet Deo has no position in the stocks mentioned. The Motley Fool has no position in the stocks mentioned. The Motley Fool has a disclosure policy.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.