Basic Fit N : Fit reports half year results 2021

BASIC-FIT REPORTS STRONG MEMBERSHIP DEVELOPMENT AFTER REOPENING

Financial results adversely affected by COVID-19-related government measures

H1 FINANCIAL HIGHLIGHTS1

Clubs closed for 81% of the time, significantly impacting results

Revenue decreased to €53.0 million (H1 2020: €182.5 million)

Underlying EBITDA of minus €12.5 million (H1 2020: €62.2 million)

Successful equity raise in April (€204 million) and convertible bond issue in June (€304 million) €497 million available liquidity at end of period

H1 OPERATIONAL HIGHLIGHTS

Clubs reopened in the Netherlands on 19 May (211 clubs) and in France and Belgium (640 clubs) on 9 June

Record numbers of joiners after reopening with below average number of leavers

Total number of memberships of 2.01 million (FY 2020: 2.00 million) compared to 1.75 million before reopening

Total number of clubs increased by 68 in H1 2021 to 973 clubs (up 142 or 17% year on year)

OUTLOOK

Ample available liquidity allows for recommencement of execution of growth strategy

Net new club openings of approximately 105 to 1,010 in 2021

Acceleration of club rollout in 2022, which will bring us close to our target of 1,250 clubs by the end of 2022

Club opening expectations are based on the assumption that there will be no new significant COVID-19 related government measures

Rene Moos, CEO Basic-Fit:

The first half of the year was defined by COVID-19 related government measures. For 81% of the period we could not welcome our members to our clubs resulting in a significant loss of revenue.

In the weeks after reopening, many members quickly came back to our clubs and we saw our membership base increase by more than 250,000 in this short time period. This shows that fitness fulfils a real need and that people are eager to be active again and work on their health and fitness.

As a result of the successful equity raise in April and convertible bond issue in June, we ended the period with a comfortable available liquidity position of just below €500 million. We also came to an agreement with our banks for an amended covenant testing at both year-end 2021 and June 2022.

1 Full IFRS reporting is provided in the condensed consolidated interim financial statements and notes to these statements

The current comfortable financial position and the positive membership developments after reopening encouraged us to recommence the execution of our growth strategy. Our club openings pipeline remains strong and we expect to open a large number of clubs in the next 18 months, which should bring us close to the targeted 1,250 clubs at the end of 2022.

We continue to keep a close eye on the development of COVID-19 and potential subsequent government measures. Nearly all new property lease contracts include a pandemic clause, providing us with the flexibility to adjust the timing or pace of club openings in case new club closures would occur. It is currently not clear how the latest government measures in France could potentially impact the demand for fitness. We have large clubs and all our clubs are equipped with optimised ventilation systems and we maintain strict hygiene protocols to ensure that our staff and members have a safe place to work and work out in.

FINANCIAL AND BUSINESS REVIEW

COVID-19 related temporary club closures

The year started with all our clubs in the Netherlands, Belgium and France being temporary closed. This was a continuation of COVID-19 related government measures in these countries that were implemented during the last months of 2020. We reopened our Dutch clubs on 19 May and our Belgian and French clubs on 9 June. When our clubs in the Netherlands, Belgium and France reopened, we had to respect restrictions like a maximum number of visitors per square meter and social distancing. Since reopening, restrictions have been relaxed which means our members can do their workouts again during their favourite time of the day, visit their live group lessons and use the showers. In Spain our clubs remained open whilst our clubs in Luxembourg only had to close for a couple of weeks. In these countries we could stay open when abiding to strict government measures.

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KEY FIGURES	H1 2021	H1 2020
(In € millions)	unaudited	unaudited
Total revenue	53.0	182.5
Club revenue	52.1	181.7
Non-club revenue	0.8	0.8
Club operating costs	(52.5)	(85.2)
Personnel costs	(8.4)	(22.1)
Other	(44.1)	(63.2)
Club EBITDA	(0.4)	96.5
Overhead	(19.8)	(26.6)
EBITDA	(20.2)	69.9
D&A	(137.3)	(125.1)
Depreciation and impairment tangibles	(61.0)	(55.2)
Amortisation and impairment intangibles	(4.7)	(7.8)
Depreciation right-of-use assets	(71.6)	(62.1)
COVID-19 rent credits	16.9	8.6
EBIT	(140.5)	(46.6)
Finance costs	(10.6)	(6.8)
Interest lease liabilities	(16.6)	(14.0)
Corporation tax	42.1	15.4
Net result	(125.6)	(51.9)
UNDERLYING KEY FIGURES
Club EBITDA	(0.4)	96.5
Rent costs (opened clubs)	(63.0)	(54.3)
Exceptional items - clubs	72.1	49.4
Underlying Club EBITDA (opened clubs)	8.7	91.5
EBITDA	(20.2)	69.9
Rent costs clubs and overhead, incl. car leases	(64.6)	(57.1)
Exceptional items - total	72.2	49.4
Underlying EBITDA	(12.5)	62.2
Underlying net result*	(65.6)	(2.7)
Basic Underlying result per share (in €)	(1.06)	(0.05)
Diluted Underlying result per share (in €)	(1.06)	(0.05)

• Adjusted for IFRS 16, PPA related amortisation, IRS valuation differences, exceptional items, one-offs and the related tax effects.
  Totals are based on non-rounded figures.

CLUB NETWORK AND MEMBERSHIP DEVELOPMENT

Club development

	H1 2021	FY 2020	H1 2020
Netherlands	216	211	202
Belgium	205	193	188
Luxembourg	10	10	10
France	492	447	393
Spain	50	44	38
Total	973	905	831

In the first half of 2021, we expanded our network by 68 clubs (69 openings and 1 closure) to 973 clubs. Over the past twelve months we have added 142 club to our network (+17% year on year). We expanded our French network to 492 clubs, an increase of 45 clubs since the start of the year and 99

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clubs or 25% over the past twelve months. In the Netherlands, we now operate 216 clubs, an increase of 14 clubs over the past twelve months. In Belgium and Spain, we increased our network by 17 and 12 clubs respectively over the past twelve months.

At the end of the period, we had 2.01 million memberships, which means that in a matter of several weeks we regained the memberships that we lost during the five months that our clubs were closed this year. Before the rebound in memberships started in the second half of May, we reached a low point of

1.75 million members. After the reopening of our clubs in Belgium and France on 9 June, we experienced record joiner growth rates for the group. We also benefitted from lower than usual churn rates since reopening.

A club is considered mature when it is at least 24 months old at the start of the year. Our 617 mature clubs had on average 2,540 members at the end of June. In the three to six weeks our Benelux and French clubs were open again, we recorded a recovery of 250 members per mature club. At the end of 2020 and June 2020 our mature clubs had on average 2,695 and 3,078 members.

REVENUE

In the first half of the year, revenue was €53.0 million compared to €182.5 million in H1 2020. The decline in revenue was entirely due to COVID-19 related government measures in our geographies. On average our clubs were closed for 81% of the time compared to 49% of the time in the first half of 2020.

Other club revenue was €1.6 million compared to €3.3 million in H1 2020 due to a longer period of temporary club closures. Other club revenue includes income from our personal trainer concepts, physiotherapists, day passes, vending and advertising revenue via the screens in our clubs. Non-club revenue of €0.8 million was slightly higher compared to last year.

Revenue split

In € millions	H1 2021	H1 2020	change
	unaudited	unaudited
Total club revenue	52.1	181.7	-71%
o.w. Fitness revenue	50.5	178.4	-72%
o.w. Other club revenue	1.6	3.3	-51%
Non-club revenue	0.8	0.8	5%
Total revenue	53.0	182.5	-71%

Totals are based on non-rounded figures

During periods clubs were closed in the first half, all memberships related to these clubs were frozen. When clubs reopened, members who were entitled for compensation for fees paid while clubs were closed in H2 2020, were not charged for the period that corresponded with the amount of compensation. In essence this meant that existing Dutch members were not charged in May 2021 and Belgian and French members were not charged in June 2021. As from July onwards, all members in all countries will start to pay their usual fees again.

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Geographic revenue split

In € millions	H1 2021	H1 2020	change
	unaudited	unaudited
Benelux	25.1	92.3	-73%
France & Spain	27.9	90.2	-69%
Total revenue	53.0	182.5	-71%

Totals are based on non-rounded figures

In the first half of 2021, the Benelux segment recorded a revenue of €25.1 million (H1 2020: €92.3

million). Revenue in the France & Spain segment amounted to €27.9 million (H1 2020: 90.2 million). The revenue decline in both segments fully reflects the longer period of temporary club closures in our three largest countries in the first half of 2021 compared to the first half of 2020.

CLUB EBITDA AND UNDERLYING CLUB EBITDA

Club EBITDA was minus €0.4 million, compared to €96.5 million in H1 2020. The loss recorded in the first half of 2021 is entirely the result of the long period our clubs were closed in the Benelux and France. The clubs combined in these countries accounted for approximately 95% of our clubs.

While on average we had more clubs in our network, total club operating expenses decreased to €52.5 million from €85.2 million in H1 2020. Personnel costs decreased to €8.4 million from €22.1 million in H1 2020. Other club costs decreased to €44.1 million from €63.2 million in H1 2020.

The reduction in costs was the result of cost-saving measures initiated after the COVID-19 outbreak in 2020 and government support schemes during the periods our clubs were temporarily closed. The government wage support schemes amounted to €30.5 million in the period (H1 2020: €16.2 million). The reduction in other club costs is explained by lower costs for sports water, lower maintenance costs and a one-off benefit of €11.2 million as a result of compensation received for fixed costs from the French and Belgian governments.

Underlying club EBITDA of opened clubs, which is club EBITDA of open clubs excluding exceptional items and adjusted for rent costs, was €8.7 million, compared to €91.5 million in H1 2020. The exceptional costs of €72.1 million include personnel, housing and other costs to the extent that we did not receive government compensation during the time that clubs were closed, as well as an IFRS 16 rent adjustment related to the rent costs of €63 million, which is the H1 2021 amount net of the COVID-19 rent credit of €16.9 million.

EBITDA AND UNDERLYING EBITDA

EBITDA was minus €20.2 million compared to a profit of €69.9 million in H1 2020. Overhead costs decreased to €19.8 million from 26.6 million in H1 2020. The decrease can be attributed to a higher amount of government support schemes for head office personnel costs and lower marketing spend.

Underlying EBITDA, which is EBITDA excluding exceptional items and adjusted for rent costs, came in at a loss of €12.5 million, compared to a profit of €62.2 million in H1 2020.

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