Planet Fitness Inc . (NYSE:PLNT) reported a robust third quarter on Tuesday, with a 13.6% year-on-year revenue increase to $277.6M, and an 8.4% rise in system-wide sales. The company's net income rose significantly to $41.3M from the previous year's $30.7M, while adjusted EBITDA was reported at $51.8M.
The franchise segment of the company showed notable growth, with revenues increasing by 21.6% to $98.2M. This was largely due to an $8.0M increase in franchise royalty revenue, fee increases, National Advertising Fund revenue, equipment placement revenue, and HVAC unit sales to franchisees.
In addition to the franchise segment, corporate-owned stores and equipment segments also posted solid growth with revenue increases of 11.8% and 6.1% respectively.
Interim CEO Craig Benson has announced adjustments to the store-level return model, decreasing capital investments while planning for new equipment placements in 130-140 franchisee-owned locations and 150-160 new store openings.
The company's strong performance has led to a surge in its share price, which jumped 8.75% in premarket trading to reach $60.
Looking ahead, Planet Fitness anticipates around a 14% full-year revenue growth and adjusted EBITDA growth of +18%. The company also plans to continue expanding its global presence, having added 26 new outlets in the third quarter alone, bringing its total to 2,498.
The robust financial health of the company is further underscored by its cash, cash equivalents and marketable securities amounting to $474.1 million.
Membership at Planet Fitness exceeded 18.5 million during the quarter and projections for 2023 include a 14% revenue increase, an 18% Adjusted EBITDA increase, a 33% Adjusted net income increase, and a 35% rise in Adjusted earnings per share.
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