Planet Fitness, Inc. (PLNT) Bundle
A Brief History of Planet Fitness
Planet Fitness, Inc. has established itself as a leading player in the fitness industry, particularly known for its low-cost gym membership model and a judgment-free workout environment. Founded in 1992 in Dover, New Hampshire, by Michael Grondahl and his brother, the company has undergone significant transformations and expansions over the years.
Company Growth and Expansion
As of September 30, 2024, Planet Fitness operates 2,369 franchisee-owned clubs and 268 corporate-owned clubs, marking an increase in total clubs from 2,575 in the previous year. In 2024, the company opened 52 new franchisee-owned clubs and 12 corporate-owned clubs, continuing its strategy of aggressive expansion.
| Year | Franchisee-Owned Clubs | Corporate-Owned Clubs | Total Clubs |
|---|---|---|---|
| 2023 | 2,254 | 256 | 2,575 |
| 2024 | 2,369 | 268 | 2,637 |
Financial Performance
For the nine months ended September 30, 2024, Planet Fitness reported total revenues of $841.2 million, up from $786.2 million in the same period of 2023, reflecting a growth of 7.0%. This revenue increase was driven by both franchise and corporate segments, with franchise segment revenues reaching $314.2 million, an increase of 8.5% year-over-year.
| Financial Metric | 2024 (9 Months) | 2023 (9 Months) | Change (%) |
|---|---|---|---|
| Total Revenue | $841.2 million | $786.2 million | 7.0% |
| Franchise Revenue | $314.2 million | $289.7 million | 8.5% |
| Corporate-Owned Clubs Revenue | $376.0 million | $332.9 million | 12.9% |
Net Income and Earnings
Planet Fitness reported a net income of $126.7 million for the nine months ended September 30, 2024, compared to $110.3 million for the same period in 2023, representing an increase of 15.0%. The company’s effective tax rate was 27.7% for the nine months ended September 30, 2024.
| Metric | 2024 (9 Months) | 2023 (9 Months) | Change (%) |
|---|---|---|---|
| Net Income | $126.7 million | $110.3 million | 15.0% | Effective Tax Rate | 27.7% | 26.0% | Increase |
Stock Performance and Share Repurchase Program
As of September 30, 2024, Planet Fitness repurchased a total of 668,432 shares at an average price of $76.88 per share, as part of a $500 million share repurchase program initiated in June 2024. The total approximate dollar value of shares that may yet be purchased under the program is $500 million.
| Month | Total Shares Purchased | Average Price Paid | Remaining Dollar Value |
|---|---|---|---|
| September 2024 | 668,432 | $76.88 | $500 million |
Operational Highlights
In the nine months ended September 30, 2024, Planet Fitness achieved an EBITDA of $352.6 million, up from $311.8 million in the prior year, reflecting a robust operational performance across both franchise and corporate-owned segments.
| Segment | 2024 (9 Months) | 2023 (9 Months) | Change (%) |
|---|---|---|---|
| Franchise Segment EBITDA | $226.5 million | $198.4 million | 14.1% |
| Corporate-Owned Clubs EBITDA | $141.5 million | $126.5 million | 11.9% |
In summary, Planet Fitness has demonstrated significant growth and resilience in its business model, maintaining a strong financial position and aggressive expansion strategy as of 2024. The company continues to enhance its market presence while optimizing operational efficiency across its franchise and corporate-owned clubs.
A Who Owns Planet Fitness, Inc. (PLNT)
Ownership Structure
As of September 30, 2024, the ownership structure of Planet Fitness, Inc. is characterized by two classes of common stock: Class A and Class B. Class A common stock is primarily held by the public and institutional investors, while Class B common stock is predominantly owned by the founders and management, providing them with greater voting power.
| Type of Stock | Shares Outstanding | Voting Power | Economic Interest |
|---|---|---|---|
| Class A Common Stock | 84,103,670 | 99.4% | 99.4% |
| Class B Common Stock | 488,207 | 0.6% | 0.6% |
Major Shareholders
The major shareholders of Planet Fitness, Inc. include institutional investors, founders, and management. As of the latest data available, the following entities and individuals hold significant stakes in the company:
| Shareholder | Ownership Stake (%) | Type of Holdings |
|---|---|---|
| Founder and Executive Chairman | Approximately 20% | Class B Common Stock |
| Vanguard Group | 10.5% | Class A Common Stock |
| BlackRock, Inc. | 8.9% | Class A Common Stock |
| State Street Corporation | 4.7% | Class A Common Stock |
| Other Institutional Investors | 55.0% | Class A Common Stock |
Recent Share Transactions
In June 2024, Planet Fitness entered into a $280,000 accelerated share repurchase agreement with Citibank, N.A., resulting in the repurchase of 3,090,507 shares of Class A common stock, which were subsequently retired. This transaction reflects the company’s strategy to return capital to shareholders while managing its equity structure effectively.
Equity Structure and Class Differences
The Class A common stockholders hold 99.4% of the voting power, while the Class B common stockholders hold only 0.6%. This structure allows the founders and management to maintain control over significant decisions affecting the company.
| Class | Voting Power (%) | Economic Interest (%) | Shareholder Type |
|---|---|---|---|
| Class A | 99.4% | 99.4% | Public/Institutional Investors |
| Class B | 0.6% | 0.6% | Founders/Management |
Current Market Performance
As of September 30, 2024, Planet Fitness reported a total revenue of $841.2 million for the nine months ended September 30, 2024, compared to $786.2 million for the same period in 2023, reflecting a growth of 7.0% year-over-year. The company’s net income attributable to Planet Fitness, Inc. for the same period was $124.96 million, representing a 14.9% net income margin.
Future Growth and Club Openings
As of September 30, 2024, Planet Fitness operates 2,637 clubs, with 2,369 being franchisee-owned and 268 corporate-owned. The company has contractual commitments to open approximately 1,000 new clubs, indicating strong growth potential in the franchise model.
Planet Fitness, Inc. (PLNT) Mission Statement
Planet Fitness, Inc. aims to provide a unique and judgment-free fitness experience for people of all backgrounds and fitness levels. The company emphasizes affordability, accessibility, and a welcoming atmosphere, allowing members to feel comfortable and empowered in their fitness journeys.
Financial Overview
For the nine months ended September 30, 2024, Planet Fitness reported total revenue of $841.2 million, an increase of $55.0 million or 7.0% compared to $786.2 million for the same period in 2023 .
| Segment | Revenue (2024) | Revenue (2023) | Change ($) | Change (%) |
|---|---|---|---|---|
| Franchise | $314.2 million | $289.7 million | $24.5 million | 8.5% |
| Corporate-owned clubs | $376.0 million | $332.9 million | $43.1 million | 12.9% |
| Equipment | $151.0 million | $163.7 million | ($12.7 million) | (7.7%) |
Key Financial Metrics
For the nine months ended September 30, 2024, the company reported:
- Total operating costs and expenses of $606.8 million, representing 72.1% of total revenue .
- Net income attributable to Planet Fitness, Inc. of $124.96 million, an increase of 21.4% from $102.97 million in 2023 .
- Adjusted net income per share of $1.45 for the nine months ended September 30, 2024, up from $1.21 .
Operating Segments
The operating segments for Planet Fitness include Franchise, Corporate-owned clubs, and Equipment. The performance of these segments for the three months ended September 30, 2024, is summarized below:
| Segment | Revenue (Q3 2024) | Revenue (Q3 2023) | Change ($) | Change (%) |
|---|---|---|---|---|
| Franchise | $102.4 million | $98.2 million | $4.3 million | 4.3% |
| Corporate-owned clubs | $128.1 million | $113.2 million | $14.9 million | 13.1% |
| Equipment | $61.7 million | $66.1 million | ($4.4 million) | (6.7%) |
Cost Structure
For the nine months ended September 30, 2024, the breakdown of major expenses included:
- Cost of revenue: $116.6 million, a decrease of 12.0% from $132.6 million in 2023 .
- Club operations expense: $216.1 million, an increase of 15.0% from $188.0 million in 2023 .
- Selling, general and administrative expenses: $93.5 million, a slight decrease of 0.3% from $93.7 million in 2023 .
Advertising and Marketing
The National Advertising Fund revenue for the nine months ended September 30, 2024, was $59.4 million, which represents an increase of 13.5% compared to $52.4 million in the same period of 2023 .
Conclusion on Mission Statement Alignment
Planet Fitness's mission statement focuses on creating a welcoming environment for all. The financial growth and stability reflected in the latest earnings reports align with its commitment to accessibility and affordability in the fitness industry, showcasing the company’s effective execution of its mission in a financially sound manner.
How Planet Fitness, Inc. (PLNT) Works
Overview of Business Segments
Planet Fitness, Inc. operates through three primary segments: franchise operations, corporate-owned clubs, and equipment sales. Each segment contributes to the overall revenue and strategic growth of the company.
Financial Performance
For the nine months ended September 30, 2024, Planet Fitness reported total revenue of $841.2 million, an increase of $55.0 million, or 7.0%, compared to $786.2 million in the same period of 2023. The breakdown of revenue by segment is as follows:
| Segment | Revenue (in thousands) | % of Total Revenue |
|---|---|---|
| Franchise | $314,225 | 37.4% |
| Corporate-owned clubs | $375,976 | 44.7% |
| Equipment | $151,003 | 18.0% |
| Total Revenue | $841,204 | 100.0% |
Segment Analysis
Franchise Segment
The franchise segment generated $314.2 million in revenue for the nine months ended September 30, 2024, reflecting an increase of $24.5 million, or 8.5%, from the prior year. Franchise revenue includes:
- Royalty revenue: $215.3 million
- Franchise and other fees: $25.6 million
- Placement revenue: $11.8 million
The increase in royalty revenue was primarily driven by a franchise same club sales increase of 5.0% and new clubs opened since January 1, 2023.
Corporate-Owned Clubs Segment
The corporate-owned clubs segment reported revenue of $376.0 million for the nine months ended September 30, 2024, representing an increase of $43.1 million, or 12.9%, compared to the previous year. This growth was attributed to:
- Same club sales increase of 4.5%: $11.9 million
- Higher annual fee revenue: $5.8 million
- Revenue from new clubs opened: $16.3 million
Equipment Segment
Revenue from the equipment segment was $151.0 million for the nine months ended September 30, 2024, a decrease of $12.7 million, or 7.8%, compared to $163.7 million in 2023. This decline was mainly due to lower equipment sales to new franchisee-owned clubs.
Operating Costs and Expenses
For the nine months ended September 30, 2024, operating costs and expenses totaled $606.8 million, representing 72.1% of total revenue. Key components include:
| Expense Type | Amount (in thousands) | % of Total Revenue |
|---|---|---|
| Cost of revenue | $116,628 | 13.9% |
| Club operations | $216,119 | 25.7% |
| Selling, general and administrative | $93,453 | 11.1% |
| Total Operating Costs | $606,752 | 72.1% |
Net Income
Net income attributable to Planet Fitness, Inc. for the nine months ended September 30, 2024, was $124.96 million, or 14.9% of total revenue, compared to $102.97 million, or 13.1% in the prior year.
EBITDA Analysis
Segment EBITDA for the nine months ended September 30, 2024, was as follows:
| Segment | EBITDA (in thousands) | Change (Year-over-Year) |
|---|---|---|
| Franchise | $226,478 | +14.1% |
| Corporate-owned clubs | $141,507 | +11.9% |
| Equipment | $41,822 | +6.9% |
| Total Segment EBITDA | $352,616 | +13.1% |
Liquidity and Capital Resources
As of September 30, 2024, Planet Fitness had cash and cash equivalents of $298.8 million, short-term marketable securities of $108.6 million, long-term marketable securities of $55.5 million, and restricted cash of $67.8 million. The company's liquidity sources provide adequate coverage for its operational and capital expenditure needs.
Debt Obligations
Interest expense for the nine months ended September 30, 2024, was $72.6 million, compared to $64.8 million for the same period in 2023, reflecting an increase attributed to the issuance of the 2024 Notes and other financing activities.
Club Growth
As of September 30, 2024, Planet Fitness operated a total of 2,637 clubs, comprising 2,369 franchisee-owned clubs and 268 corporate-owned clubs. The company opened 52 new franchisee-owned clubs and 12 corporate-owned clubs during the nine months ended September 30, 2024.
How Planet Fitness, Inc. (PLNT) Makes Money
Revenue Streams
Planet Fitness generates revenue through several key segments:
- Franchise Revenue
- Corporate-Owned Clubs Revenue
- Equipment Sales Revenue
- National Advertising Fund Revenue
Franchise Revenue
Franchise revenue is a significant contributor to Planet Fitness's income. For the nine months ended September 30, 2024, franchise segment revenue totaled $314.2 million, representing an increase of 8.5% from $289.7 million in the same period of 2023. This revenue includes:
- Royalty Revenue: $215.3 million (up from $195.3 million)
- Franchise and Other Fees: $25.6 million (down from $26.1 million)
- Placement Revenue: $11.8 million (down from $13.8 million)
Corporate-Owned Clubs Revenue
Revenue from corporate-owned clubs also saw substantial growth. For the nine months ended September 30, 2024, this segment reported $376.0 million, up 12.9% from $332.9 million in 2023. The breakdown of revenue sources includes:
- Same Club Sales: $11.9 million from a same club sales increase of 4.5%
- Annual Fee Revenue: $5.8 million
- Other Fees: $9.1 million
- New Clubs Opened Since January 1, 2023: $16.3 million
Equipment Sales Revenue
Equipment sales revenue experienced a decline. For the nine months ended September 30, 2024, revenue from the equipment segment was $151.0 million, down 7.7% from $163.7 million in the same period of 2023. This decrease was primarily due to:
- Lower equipment sales to new franchisee-owned clubs, totaling $10.6 million
- Lower equipment sales to existing franchisee-owned clubs, totaling $2.1 million
National Advertising Fund Revenue
The National Advertising Fund (NAF) revenue for the nine months ended September 30, 2024, was $59.4 million, an increase of 13.5% from $52.4 million in 2023. This growth was driven by:
- Higher same club sales and new clubs opened since January 1, 2023 contributing $3.4 million
- Collection of NAF revenue on annual fees contributing $3.1 million
Financial Overview
The total revenue for Planet Fitness for the nine months ended September 30, 2024, was $841.2 million, up 7.0% from $786.2 million in 2023. Below is a detailed financial overview:
| Revenue Category | 9 Months Ended Sep 30, 2024 (in millions) | 9 Months Ended Sep 30, 2023 (in millions) | Change (%) |
|---|---|---|---|
| Franchise Revenue | $314.2 | $289.7 | +8.5% |
| Corporate-Owned Clubs Revenue | $376.0 | $332.9 | +12.9% |
| Equipment Revenue | $151.0 | $163.7 | -7.7% |
| National Advertising Fund Revenue | $59.4 | $52.4 | +13.5% |
| Total Revenue | $841.2 | $786.2 | +7.0% |
Operating Costs and Expenses
For the nine months ended September 30, 2024, total operating costs and expenses were $606.8 million, which represents 72.1% of total revenue. Key expenses included:
- Cost of Revenue: $116.6 million
- Club Operations Expense: $216.1 million
- Selling, General and Administrative Expenses: $93.5 million
- National Advertising Fund Expense: $59.6 million
- Depreciation and Amortization: $120.2 million
Net Income
Net income attributable to Planet Fitness for the nine months ended September 30, 2024, was $124.96 million, compared to $102.97 million in 2023, reflecting a net income margin of 14.9% in 2024.
| Financial Metric | 9 Months Ended Sep 30, 2024 (in millions) | 9 Months Ended Sep 30, 2023 (in millions) |
|---|---|---|
| Net Income | $124.96 | $102.97 |
| Net Income Margin (%) | 14.9% | 13.1% |
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Resources:
- Planet Fitness, Inc. (PLNT) Financial Statements – Access the full quarterly financial statements for Q3 2024 to get an in-depth view of Planet Fitness, Inc. (PLNT)' financial performance, including balance sheets, income statements, and cash flow statements.
- SEC Filings – View Planet Fitness, Inc. (PLNT)' latest filings with the U.S. Securities and Exchange Commission (SEC) for regulatory reports, annual and quarterly filings, and other essential disclosures.