This article first appeared on GuruFocus .
Release Date: August 14, 2026
For the complete transcript of the earnings call, please refer to the full earnings call transcript .
Positive Points
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Revenue growth of 7% currency adjusted, outpacing cost growth of 4%, leading to EBITDA up 18% and EBIT up 23% currency adjusted.
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Strong member engagement with workouts up 3% and group training workouts up 5%, driven by a 7% increase in unique participants.
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Improved profitability with EBITDA margin up 2.3 percentage points and EBIT margin up 2.6 percentage points, with country EBITDA margins up in Norway, Sweden, and Denmark.
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Solid cash generation with free cash flow of NOK602 million over the last 12 months and a high EBITDA-to-cash conversion rate of 82%.
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Strong balance sheet with leverage at 1.1x, below the target range, and ample liquidity of NOK1.3 billion, supporting continued shareholder returns and expansion.
Negative Points
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Net member development was negative at minus 25,000 in the quarter, worse than the prior year's minus 19,000, due to a cohort effect and campaign timing.
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Club portfolio saw a net reduction of three clubs in 2026, with two club closures in the quarter, impacting member base growth.
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Reported revenue growth was held back by weaker Swedish and Danish kroner and a weaker euro, masking underlying performance.
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Cost growth of 4% currency adjusted was partly driven by deliberate investments in group training and higher direct costs from personal training and retail, which could pressure margins if not sustained.
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Maintenance CapEx was temporarily low due to timing, with a target of around 5% of revenues annually, indicating potential future capital expenditure increases.
Q & A Highlights
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Q: What were the key drivers behind the strong financial performance in Q2 2026? A: CEO Sondre Gravir highlighted that the operating model continues to work as intended, with member activity growing and revenues up 3% reported and 7% currency adjusted. The main driver was ARPAM, which increased 6% currency adjusted due to pricing and product mix. Cost growth was held at 4% currency adjusted, leading to EBITDA up 18% and EBIT up 23% currency adjusted, with both margins expanding by more than 2 percentage points.
Q: How is the company's expansion pipeline looking, and what is the outlook for new club openings? A: CEO Sondre Gravir explained that 2026 will show a net reduction of three clubs due to selective exits and pipeline timing, but the ambition to open 8 to 12 new clubs per year remains unchanged. The committed pipeline currently stands at 13 new clubs through 2028, with the majority in Norway. He emphasized that the company will not compromise location quality to hit a number, and several ongoing dialogues could add more clubs once agreements are signed.
Q: Can you elaborate on the member development and retention trends in the quarter? A: CFO Cecilie Elde noted that members ended at 744,000, up 1% year-over-year despite three fewer clubs. Net member development was minus 25,000, compared to minus 19,000 in the same quarter last year, which was expected and flagged in Q1. This was due to a cohort effect from strong intake early last year and campaign structure shifting churn into Q2. Churn outside this group was stable, indicating no broad weakening of retention.
Q: What is driving the growth in group training, and how does it impact the financials? A: CEO Sondre Gravir highlighted that group training workouts are up 5% and unique participants up 7%, with new members driving the growth. CFO Cecilie Elde added that direct costs grew 10% currency adjusted, reflecting higher variable costs from personal training and retail sales. Deliberate investments in group training, including more classes and instructor capacity, add costs but are exactly what drives the 5% growth in workouts and 7% increase in unique participants.
Q: How is the company managing its capital allocation and shareholder returns? A: CEO Sondre Gravir stated that the policy remains unchanged, with leverage guided to the lower end of the 1.5x to 2x range and more than 50% of annual net profit returned through dividends and buybacks. The Board resolved a dividend of NOK0.72 per share for H1 2026, and with gross buybacks of NOK318 million, the total H1 payout ratio is 152%. CFO Cecilie Elde added that net debt was just below NOK1.1 billion with leverage at 1.1x, below the target range, and liquidity remains solid at NOK1.3 billion.
Q: What are the main cost drivers, and how is cost growth being controlled? A: CFO Cecilie Elde explained that total operating costs were flat in reported terms and up 4% currency adjusted. Club OpEx grew only 2% currency adjusted despite extra costs for group training, meaning like-for-like cost growth per club is below wage inflation. Overhead increased slightly due to costs related to the IT security incident last quarter, and direct costs grew 10% currency adjusted, following higher personal training and retail activity. Over the last 12 months, total costs are up 5% currency adjusted, well below revenue growth.
Q: How is the company's cash flow performing, and what are the expectations for the rest of 2026? A: CFO Cecilie Elde reported free cash flow of NOK100 million in the quarter and NOK602 million over the last 12 months. EBITDA converted to operating cash flow at 65% in the quarter and 82% on a 12-month basis. The second quarter is seasonally weakest due to holiday pay settlement in Norway and tax payments, but these are timing effects that reverse. She expects limited cash tax outflow for the remainder of 2026, with the second half being seasonally stronger.
Q: What is the impact of currency fluctuations on the reported results? A: CFO Cecilie Elde noted that reported figures are held back by weaker Swedish and Danish kroner and a weaker euro. Revenue growth was 3% reported but 7% currency adjusted, and EBITDA was up 18% currency adjusted. The Danish VAT change also masks underlying development, but the effect is smaller on profit than revenue, with Danish country EBITDA actually improved by 20% currency adjusted in the quarter.
Q: How is the company progressing towards its mid-term financial ambitions? A: CFO Cecilie Elde highlighted that on a 12-month basis, EBITDA before IFRS 16 is now NOK946 million, moving towards the mid-term ambition of NOK1.1 billion. CEO Sondre Gravir added that earnings per share is up from NOK1.10 to NOK2.62 on a last 12-month basis, representing a CAGR of 42% since 2023. The predictability of the business, with consistent delivery on targets, gives confidence in continued strong operational and financial development.
Q: What is the company's approach to CapEx and investment discipline? A: CFO Cecilie Elde stated that total CapEx in the quarter was NOK59 million, with NOK56 million related to upgrades and maintenance. Maintenance CapEx is temporarily low due to timing, but the target remains around 5% of revenues annually. Upgrades and maintenance CapEx also includes growth investments in the existing club portfolio, which is an important growth lever. On expansion, the company maintains strict investment discipline, prioritizing club quality, competition, and the cluster strategy.
For the complete transcript of the earnings call, please refer to the full earnings call transcript .
