Virgin Active South Africa has seen double-digit growth in fitness class attendance - and is investing heavily in ‘digital coaching’
- Virgin Active saw class attendance jump 13% in South Africa in the past year.
- This as the health brand is transforming to deliver "feel-good" exercise experiences.
- The company said it is investing heavily in digital, with "digital coaching" already launched in Italy.
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Virgin Active South Africa - the country’s largest gym network – saw a 13% increase in occupancy levels of its fitness classes to 65% in the past year.
26% of its members are now attending fitness classes.
Virgin Active is a wholly owned subsidiary of Brait, which also owns Premier Foods with consumer brands such as Blue Ribbon bread and Snowflake flour.
Brait’s financial results, released on Tuesday, revealed that Virgin Active South Africa had revenue growth of 4% in the past year, Virgin Active UK saw revenue growth of 2%, Virgin Active Italy growth of 9%, and Virgin Active Asia growth of 9%.
Brait said Virgin Active is globally undergoing a transformation to deliver "feel-good" exercise experiences at a time and place convenient to consumers.
Investments are therefore being made in group exercises, digital capability, and infrastructure through 2019 and 2020.
In Italy, for example, 3,500 members now participate in "digital coaching", and 89% of the 158,000 members in the country use the Virgin Active application.
The company said to support growth in exercise programmes at its 141 South African clubs, 20 additional and upgraded exercise studios have been introduced.
Globally, Virgin Active has over 1.2 million members, an increase of 2% since 2018.
While South African adult members are 59% of the company’s overall consumer base, they only represent 39% of the company’s income.
Brait said gym penetration is relatively low in South Africa's middle-income group (7%) compared to 14.8% in the UK and 8.8% in Italy.
This suggests possible further growth in the segment.
Brait said a 2% decline in South African memberships in 2018 was reversed by 2% growth, predominantly driven through Discovery Vitality discounts.
A contract was concluded with Discovery Vitality until 2025 which saw the upfront activation fee drop from R1,999 to R799, it said.
Brait sees R11.5 billion overall loss
Overall, the Luxembourg-listed Brait saw an operating loss of €708 million (roughly R11.5 billion) the past financial year, predominantly driven by the challenging consumer environment in South Africa and the United Kingdom.
Virgin Active accounts for about 53% of Brait’s assets.
The company saw its share prices decline from R170 in 2015, to R18.15 on Tuesday partly due to its investment in British high street retailer New Look.
“Weak consumer demand, inflationary cost pressures and increased promotional activity among our competitors, have affected the performance of our portfolio companies and their peers,” Brait chair Jabu Moleketi said.
He said the company is committed to improving profit margins and operations as it doesn’t foresee an immediate improvement in the economic outlook.
“We believe this approach puts us in the best possible position as and when conditions improve.”
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