Xponential Fitness, Inc. Announces Exclusive Strategic Development Agreement with the Operator of the LA Fitness and City Sports Club Brands
The agreement expands Xponential's footprint and membership base by bringing its boutique fitness brand studios to over 500 LA Fitness and City Sports Club locations across the country
IRVINE, Calif., Nov. 4, 2021 /PRNewswire/ -- Xponential Fitness, Inc. (NYSE: XPOF) ("Xponential" or "the Company"), a curator of leading boutique fitness brands, and Fitness International, LLC, operator of LA Fitness ("LAF") and City Sports Club ("CSC"), today announced an exclusive development agreement. The agreement lays out a minimum development of over 350 franchised locations over five years to add Xponential brands in more than 500 Fitness International locations.
This development commitment will afford Xponential Fitness the opportunity to invite existing franchisees who own a studio with an LAF or CSC location within their protected territory to open an Xponential brand studio inside of these locations. A membership to an Xponential brand studio within an LAF or CSC facility will be available to existing gym members for an additional cost.
Studio development time and buildout costs of these locations will be less than those of a traditional standalone studio, and existing franchise partners will have an opportunity to drive additional revenues while operating these locations free of initial franchise fees and lower marketing fund fees. AUVs at these locations are expected to be lower than those of traditional studio locations; however, this opportunity provides for reduced operating costs than standalone studios.
"We are pleased to enter into an exclusive development agreement with Fitness International to further our mission of making boutique fitness accessible to everyone, increasing our total addressable market, and providing expansion opportunities to our franchisees," said Anthony Geisler, CEO of Xponential Fitness, Inc. "This provides a unique opportunity for franchisees to increase their reach and overall revenue generation within their protected territories. We look forward to delivering best-in-class boutique fitness to the LA Fitness and City Sports Club communities."
"We are proud to welcome Xponential brand studios to our LA Fitness and City Sports Club locations," said Jill Grueling, President, Club Operations of Fitness International. "Xponential will bring additional high-quality fitness experiences to our members. We are confident their boutique fitness brands will provide an excellent complement to our members' existing workout routines."
Development of Xponential Fitness brand studios within Fitness International locations is expected to begin in the first quarter of 2022 and will not have an immediate impact on Company revenues during the current calendar year. Management looks forward to updating the investment community further on the strategic benefits of this partnership on its upcoming third quarter earnings conference call on November 11, 2021 at 2 PM PT / 5 PM ET. More information on the third quarter earnings call can be found on Xponential's investor relations website.
About Xponential Fitness, Inc.
Founded in 2017 and headquartered in Irvine, California, Xponential Fitness, Inc. (NYSE: XPOF) is a curator of leading boutique fitness brands across multiple verticals. Through its mission to make boutique fitness accessible to everyone, the Company has built and curated a diversified platform of ten boutique fitness brands spanning across verticals including Pilates, indoor cycling, barre, stretching, rowing, dancing, boxing, running, functional training and yoga. In partnership with its franchisees, Xponential Fitness offers energetic, accessible, and personalized workout experiences led by highly-qualified instructors in studio locations across the 48 U.S. states and Canada, and through master franchise or international expansion agreements in 10 additional countries as of October 13, 2021. Xponential Fitness' portfolio of brands includes Club Pilates, the nation's largest Pilates brand; CycleBar, the nation's largest indoor cycling brand; StretchLab, a concept offering one-on-one and group stretching services; Row House, a high-energy, low-impact indoor rowing workout; AKT, a dance-based cardio workout combining toning, interval and circuit training; YogaSix, the largest franchised yoga brand; Pure Barre, a total body workout that uses the ballet barre to perform small isometric movements; STRIDE, a treadmill-based cardio and strength training concept; Rumble, a boxing-inspired full-body workout; and BFT, a functional training and strength-based program. For more information, please visit the Company's website at xponential.com.
About Fitness International
Fitness International, LLC is one of the fastest-growing health club chains in the U.S., with over 700 locations across 27 U.S. states and Canada. Operating the brand names LA Fitness, Esporta Fitness, and City Sports Club, the company's mission is to help as many people as possible achieve the benefits of a healthy lifestyle by creating a nationwide network of health clubs, offering its members the widest range of amenities and the friendliest service at an affordable price. To learn more about Fitness International's growth, visit lafitness.com, esportafitness.com, and citysportsfitness.com. Follow Fitness International on Facebook, Instagram or by downloading its mobile apps.
Forward-Looking Statements
This press release contains forward-looking statements that are based on current expectations, estimates, forecasts and projections of future performance based on management's judgment, beliefs, current trends, and anticipated financial performance. These forward-looking statements include, but are not limited to, statement relating to the execution of the Company's growth strategies. Forward-looking statements involve risks and uncertainties that may cause actual results to differ materially from those contained in the forward-looking statements. These factors include, but are not limited to, the impact of COVID-19 pandemic on our business and franchisees; difficulties and challenges in opening studios by franchisees; the ability of franchisees to generate sufficient revenues; risks relating to expansion into international market; and loss or reputation and brand awareness; and other risks as described in the filings of Xponential with the Securities and Exchange Commission, including the Quarterly Report on Form 10-Q. Other unknown or unpredictable factors or underlying assumptions subsequently proving to be incorrect could cause actual results to differ materially from those in the forward-looking statements. Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, level of activity, performance, or achievements. You should not place undue reliance on these forward-looking statements. All information provided in this press release is as of today's date, unless otherwise stated, and Xponential undertakes no duty to update such information, except as required under applicable law.
SOURCE LA Fitness
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