Planet Fitness falls after reeling in full-year guidance

Planet Fitness (NYSE:PLNT) reported revenue increased 11.6% year-over-year to $248M. System-wide sales were up 6.2% during the quarter. Franchise segment revenue increased 12.2% to $104.0M. Corporate-owned stores segment revenue increased 15.6% to $122.4M. Equipment segment revenue decreased 8.6% to $21.6M. Planet Fitness ended the quarter with approximately 19.6M members.

Adjusted EBITDA increased $16.1M to $106.3M from a year ago. EPS was reported at $0.53 vs. $0.50 consensus and $0.41 a year ago.

During the quarter, the New Hampshire-based company opened 25 new Planet Fitness (PLNT) stores, which included 23 franchisee-owned and 2 corporate-owned stores, bringing system-wide total stores to 2,599 as of March 31.

Interim CEO update: “During the quarter, we faced several headwinds which impacted our results including a shift in consumer focus in the New Year to savings and concern over the increase in COVID infections and other illnesses, as well as a national advertising campaign that we believe may not have resonated as broadly as we had anticipated. As a result of these and other factors, we are lowering our outlook for the full year… Despite these near-term headwinds, we are acting on the things that we can control. We’re focused on advancing our New Franchisee Growth Model and its strategic priorities and supporting our franchisees, while driving enhanced value for shareholders.”

Looking ahead, Planet Fitness (PLNT) continues to expect new equipment placements of approximately 120 to 130 in franchisee-owned locations. The company also continues to expect system-wide new store openings of approximately 140 to 150 locations. PLNT now expects system-wide same store sales in the +3% to +5% year-over-year growth range, down from a prior range of +5% to +6%. Total revenue is expected to increase in the +4% to +6% range, down from a prior range of +6% to +7%.

Shares of Planet Fitness (PLNT) fell 11.08% in light premarket trading. The stock was up 3% in the week ahead of the earnings release.