Basic Fit N : Half Year Results Announcement / 200731 HY Results 2020 BFIT

	FIT
-
BASIC		2020
HALF YEAR RESULTS

DE HIER PLAATS

SPEAKERS:		Rene Moos, CEO &
		Hans van der Aar, CFO

DATE:		31 July 2020

HIGHLIGHTS

COVID-19 lockdown related club closures determining factor in H1 results

2

IN MARCH ALL CLUBS CLOSED DUE TO COVID-19 LOCKDOWN

Focus on retention and engagement of members and employees

• Clear communication
• Membership freeze and compensation
• Support for instructors and partners

Focus on cash flow and cost reduction

• Reduction of capex and operating costs
• €100 million additional bank financing and €133 million equity raise

3

ALL CLUBS OPEN ON 1 JULY 2020

New government measures and local closures remain a possibility until a COVID-19 vaccine has been found

Mid -	29	2 June	8	June	14	22	1 July
March	May	June	June

		Reopening	Reopening	Reopening
Basic-Fit	Reopening	clubs in	clubs in	clubs in	Reopening	Reopening
closes al of	clubs in	France (ex.	Belgium and	Paris and	clubs in	clubs in the
its clubs	Luxembourg	Paris/Ile-de-	Spain (ex.	Ile-de-	Madrid	Netherlands
		France)	Madrid)	France

4

HOW WE ASSURE A SAFE AND WELCOMING FITNESS CLUB

Optimised ventilation assures ample inflow of fresh air and no recirculation

5

MEMBERS FINDING THEIR WAY BACK TO THE CLUBS

Our large clubs and reservation system prove effective

Visits at mature French clubs are close to pre-COVID-19 levels 1 month after re-opening

France: Mature club entrances per hour

5	6	7	8	9	10	11	12	13	14	15	16	17	18	19	20	21	22	23
								July 2020		July 2019

French clubs timeslot capacity utilisation (%) 20-24 July - ample capacity

Hour	Mon	Tue	Wed	Thu	Fri
06:00	14	15	14	13	13
07:00	14	14	13	12	13
08:00	19	20	19	18	18
09:00	31	31	29	28	28
10:00	40	37	37	35	35
11:00	34	34	31	31	30
12:00	34	34	32	31	28
13:00	23	22	24	20	19
14:00	33	32	30	29	29
15:00	35	34	32	31	33
16:00	39	38	36	33	34
17:00	56	53	51	47	41
18:00	70	68	64	60	47
19:00	64	61	58	54	42
20:00	51	48	46	43	34
21:00	45	43	40	39	30

6

STRONG MEMBERSHIP DEVELOPMENT PRE AND POST CLOSURES

More joiners in June and July than in same period in 2019

Group: joiners between Jan-Jul in 2019 and 2020

June 2020 recorded more joiners than last year in spite of Dutch closures and other countries not open for the entire month

Jul '20

up 70%

YoY

July 2020 joiners per club shows an increase of 70% compared to July last year

Number of leavers similar in July 2020 vs July 2019

Jan

Mar

May

Jul

2019 2020

7

LONG-TERM GROWTH STRATEGY UNCHANGED

Restart club construction after positive membership development

Increased availability of sites at better terms, pandemic clause in new property lease contracts

Strengthened balance sheet enables reignition of club rollout plan

Around 100 club openings planned for 2020 1,250 clubs target for 2022 maintained

Club openings pipeline (# clubs)

300				> 250
200		145	170
100	52
47
0
Net openings	Under	Contracts signed	Contracts being	Sites being
	construction		negotiated	researched

8

EEN HIER PLAATS

FINANCIAL REVIEW

INCOME STATEMENT

Underlying (club) results

In € millions		H1 2020		H1 2019
Total revenue		182.5		240.0
	Club revenue		181.7		239.1
	Non-club revenue		0.8		0.9
Club operating costs		(85.2)		(86.7)
Total overhead		(26.6)		(32.9)
	International overhead		(12.3)		(14.6)
	Country overhead (incl. marketing)		(14.3)		(18.3)
EBITDA		69.9		119.5
Cash rent costs clubs and overhead, incl. car leases		(49.1)		(52.4)
Exceptional items		41.4		1.2
Underlying EBITDA		62.2		68.3
	In € millions		H1 2020		H1 2019
	Total club revenue		181.7		239.1
	Fitness revenue		178.4		233.5
	Other club revenue		3.3		5.6
	Club operating costs		(85.2)		(86.7)
	Personnel costs		(22.1)		(34.9)
	Other		(63.2)		(51.8)
	Club EBITDA		96.5		152.4
	Open clubs Cash rent costs		(46.4)		(49.2)
	Clubs Exceptional items		41.4		0.7
	Underlying Club EBITDA (open clubs)		91.5		103.9

2.5 to 3.5 months in membership fees lost this year due to COVID-19 lockdown related closures in H1 2020

Lower overhead expenses due to cost savings and lower marketing spend Lower cash rent costs reflect support from our landlords

€41.4 million exceptional costs related to COVID-19

Similar level of club operating costs in spite of more clubs mainly as a result of government compensation schemes

Higher other club costs due to network growth of 149 clubs year on year Lower club EBITDA reflects loss in revenue

Underlying club EBITDA decreases by 12% year on year

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INCOME STATEMENT

Net income impacted by COVID-19

In € millions	H1 2020			H1 2019
EBITDA			69.9			119.5
D&A		(125.1)		(97.9)
Depreciation		(55.2)		(43.0)
Amortisation		(7.8)		(6.2)
Depreciation right-of-use assets			(62.1)		(48.7)
Lease concessions		8.6		0.0
EBIT		(46.6)		21.6
Finance costs		(6.8)		(8.2)
Interest lease liabilities		(14.0)		(12.0)
Corporation tax		15.4		(0.6)
Net result		(51.9)		0.9

Underlying net loss of €2.7 million entirely due to impact COVID-19 lockdown related club closures

Lease concessions relate to the property rent discounts received from landlords which did not entail an amendment of lease contracts

Corporation tax income of €15.4 million; ETR 23%

	In € millions	H1 2020		H1 2019
	Net result		(51.9)		0.9
	Amortisation		5.4		5.6
	Valuation differences IRS		0.6		3.6
	Exceptional items		41.4		1.2
	IFRS 16 adjustments		26.9		8.2
	Lease concessions		(8.6)		-
	Tax effects (25%)		(16.4)		(4.6)
	One-off tax effects		0.0		(1.3)
	Underlying net result		(2.7)		13.5

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MATURE CLUB DEVELOPMENT

Mature clubs account for 62% of total clubs and 75% of total club revenue

513 mature clubs compared to 405 at the end of 2019, with 323 (+16) in Benelux and 190 (+92) in France and Spain

Average number of members per mature club decreased by 9% to 3,078 from 3,329 a year ago

Number of leavers similar compared to last year; no joiners during club closures

12

CAPITAL EXPENDITURE

In € millions	H1 2020	H1 2019
Maintenance capex	(17.8)	(11.9)

Expansion capex

(67.5)

(80.0)

Other capex

(6.9)

(7.0)

Total capex

(92.3)

(98.9)

Maintenance capex

€22 thousand per club

FY20 expected around €50 thousand per club

Expansion capex

H1 2019 included €10 million prepayment for the Fitland acquisition

Includes €9.6 million investments in acquisitions, yet to open clubs and expansion of existing clubs €1.23 million spent on average per newly built club.

Other capex

We acquired full IP rights of our exclusive membership administration software

Around €10 million other capex expected in 2020

13

BALANCE SHEET

Net debt* of €399 million (FY 2019: €451 million)

• Leverage ratio of 2.3 versus 2.5 in 2019 (bank covenants definition)

NWC of - €108 million (FY 2019: - €111 million)

• NWC is - 24% of revenue compared to - 21% in 2019

€189 million cash at hand (FY 2019: €66.5 million)

• €30 million from bank facility still available for draw down

*Note: net debt is calculated on a frozen GAAP basis, i.e. excluding the adoption of IFRS 16

14

LONG-TERM GROWTH STRATEGY UNCHANGED

Restart club construction after positive membership development

Increased availability of sites at better terms, pandemic clause in new property lease contracts

Strengthened balance sheet enables reignition of club rollout plan

Around 100 club openings planned for 2020 1,250 clubs target for 2022 maintained

Club openings pipeline (# clubs)

300				> 250
200		145	170
100	52
47
0
Net openings	Under	Contracts signed	Contracts being	Sites being
	construction		negotiated	researched

15

DISCLAIMER

This presentation contains certain forward-looking statements with respect to the financial condition, results of operations and business of Basic Fit N.V. and its subsidiaries (referred to as 'the company') and certain of the plans and objectives of the company with respect to these items.

The words "believes", "expects", "may", "will", "could", "should", "shall", "risk", "intends", "estimates", "aims", "plans", "predicts", "continues", "assumes", "positioned" or "anticipates" and similar expressions (or their negative) identify certain of these forward-looking statements. These forward-looking statements are statements regarding the company's intentions, beliefs or current expectations concerning, among other things, the company's results of operations, financial condition, liquidity, prospects, growth, strategies and the industry in which the company operates. The forward-looking statements in this presentation are based on numerous assumptions regarding the company's present and future business strategies and the environment in which the company will operate in the future. Forward-looking statements involve inherent known and unknown risks, uncertainties and contingencies because they relate to events and depend on circumstances that may or may not occur in the future and may cause the actual results, performance or achievements of the company to be materially different from those expressed or implied by such forward looking statements. Many of these risks and uncertainties relate to factors that are beyond the company's ability to control or estimate precisely, such as future market conditions, currency fluctuations, the behaviour of other market participants, the actions of regulators and other factors such as the company's ability to continue to obtain financing to meet its liquidity needs, changes in the political, social and regulatory framework in which the company operates or in economic or technological trends or conditions. Past performance should not be taken as an indication or guarantee of future results, and no representation or warranty, express or implied, is made regarding future performance.

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THANK	YOU
FOR YOUR ATTENTION