PureGym confirms closure of operations in Poland
by Liz Terry | 17 Nov 2020
Cobbold has confirmed the closure of PureGym's Polish estate / PureGym
Humphrey Cobbold, CEO of PureGym, has confirmed to HCM that the company's operations in Poland have been placed into bankruptcy following a strategic review.
The 19 gyms will not reopen once the current lockdown in Poland is lifted.
PureGym initially supported the clubs as lockdowns in Poland pushed them into a loss-making position, but with no end in sight, the company said it was forced to review ongoing commitment and a decision was taken that capital would be better deployed elsewhere within the business.
A withdrawal from the Polish market followed.
PureGym said it has a market-leading position in all other countries where it trades, except Poland and that the business there has been showing no sign of returning to profit.
The clubs were part of The Fitness World portfolio which was acquired by Pure Gym towards the end of 2019, with Cobbold saying at the time that the Polish market offered an ‘exciting growth position’.
The 19 Polish gyms were a small part of the PureGym universe, contributing only around £1.8m turnover and £500k profit in 2019, in contrast with the scale of the overall business, which had a £500m turnover the same year.
Cobbold is thought to be focusing on Pure’s larger core business and seeing the Polish portfolio as a drag on resources without an upside in the current climate.
The closures will leave PureGym with around 500 clubs across the UK, Denmark and Switzerland.
The clubs will be sold if a buyer can be found by the trustees appointed to deal with the assets. Debts will not be made public, according to a spokesperson.
Cobbold is now focusing efforts on PureGym finances, with parent company, Pinnacle Bidco, announcing a €445m bond issue on 9 November to replace bridging finance which had been organised to fund the Fitness World acquisition on 14 January 2020.
Cobbold told HCM in an exclusive interview recently that PureGym is well capitalised, having raised £200 million (€222.7m) cash to support the business through the pandemic.
FOOTNOTE
Humphrey Cobbold will be appearing before the UK government's BEIS select committee at 11.30am GMT today (Tuesday 17 November), to discuss COVID-19 and its impact on businesses and workers, in a session which begins at 10.30am GMT.
You can watch this live online here.
PureGym confirms closure of operations in Poland06 Nov 2020
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14 Oct 2020
PureGym considers legal action as UK fitness industry fights back against forced closures in Liverpool
11 Sep 2020
Pure Gym negotiates additional £150m liquidity
27 Aug 2020
Pure Gym's overseas clubs were back in profit within a month of reopening
13 Jul 2020
European operations helped PureGym survive losses of £4m a week during lockdown
FEATURE: Interview – Humphrey Cobbold
Humphrey Cobbold, CEO of PureGym, has confirmed to HCM that the company's operations in Poland have been placed into bankruptcy following a strategic review. The 19 gyms will not reopen once the current lockdown in Poland is lifted. PureGym initially supported the clubs as lockdowns in Poland pushed them into a loss-making position, but with no end in sight, the company said it was forced to review ongoing commitment and
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