The changes increased its net loss for the fiscal year to $6.4 million from $1.7 million.
The global franchisor of boutique health and wellness brands reported an operating loss of $51.9 million against a loss of $303,000 for Q4 ended Dec. 31. The net loss was $62.5 million against a loss of $12.3 million as total revenues fell by 6.9 percent to $83.2 million from $89.3 million. Franchise sales rose by 17 percent to $45.3 million but equipment revenues contracted by 22 percent to $12.7 million. Total membership rose 15 percent year-over-year at period end to 813,000. The company sold 400 franchise licenses and opened 464 new studios last year, ending 2024 with 3,233 global studios that includes 225 outside the US.
Xponential Fitness, when reporting the results, announced a restatement of its FY23 results. The changes increased its net loss for the fiscal year to $6.4 million from $1.7 million and lowered its adjusted Ebitda to $100.3 million from $105.3 million. Shares in the group fell by more than 38 percent after the Q4 figures and restated results were disclosed.
The group is continuing to build out its executive suite with new hires for president of North America, Chief Operating Officer, Chief Development Officer, and Chief Technology Officer as it looks to reshape and strengthen its business. Actions include merging its franchise sales team with real estate and construction teams and rethinking the layout of its studios for better customization and to maximize productivity per square foot.
“The goal here is to from the ground up build a culture and infrastructure with corresponding structure and processes that will ensure Xponential scales in a long-term sustainable manner,” CEO Mark King told analysts. “Practically, this means that 2025 will largely be a year of foundation building, allowing for growth to re-accelerate.”
For FY24, the group operating loss was $53.6 million against a profit of $34.9 million. The annual net loss was $98.7 million against a loss of $6.4 million. Total revenues were essentially flat at $320.3 million versus $317.9 million despite a 22 percent increase in FY franchise revenues to $174.5 million. Same store sales rose at Club Pilates (+12%), YogaSix (+6%), and Pure Barre (+3%) but declined at CycleBar (-3%) and StretchLab (-5%).
The company’s current FY25 outlook calls for global closes of 5 to 7 percent with total revenues coming at $315-$325 million. North American systemwide sales will range between $1.935 and $1.955 billion, up 13 percent at the midpoint. Adjusted Ebitda is forecast to increase by 5 percent at the midpoint in a $120-$125 million. Global net new studio openings, net of closures, is pegged at $200-220 million, a 12 percent drop at the midpoint.
