Planet Fitness (NYSE:PLNT) reported fourth-quarter results on March 1. The company's fitness centers are proving popular with first-time gym users, leading to a sharp rise in same-store sales and overall profits.

Planet Fitness results: The raw numbers


Q4 2016

Q4 2015

Year-Over-Year Change


$116.4 million

$105.8 million


Adjusted EBITDA

$44.1 million

$37.5 million


Adjusted net income

$19.7 million

$17.0 million


Data source: Planet Fitness Q4 2016 earnings press release.

What happened with Planet Fitness this quarter?

Planet Fitness opened 74 new stores in the fourth quarter, bringing its total store count to 1,313 as of Dec. 31, 2016.

Systemwide same-store sales surged 10.6%, accelerating from a 6.2% increase in Q4 2015. That capped an impressive 10-year streak of consecutive quarterly same-store sales growth.

A woman on a treadmill at Planet Fitness

Image source: Planet Fitness.

"The vast majority of this comp performance was driven by membership growth as an increasing number of consumers including a large percentage of first time gym users are joining Planet Fitness," said CEO Christopher Rondeau during a conference call with analysts.

Rondeau went on to state that the approximately 8.9 million members the company had by the end of 2016 was "a milestone that the fitness industry has never come close to seeing."

Combined with the company's store count expansion, this strong membership growth helped to drive revenue in Planet Fitness' franchise segment 30.2% higher year over year to $32.1 million. In turn, franchise EBITDA (earnings before interest, taxes, depreciation, and amortization) jumped 34.8% to $25.9 million.

This highlights the scalability of Planet Fitness' franchise business model, a topic Rondeau touched upon when discussing the company's full-year 2016 results: "Financially, our high-margin recurring revenue stream coming from our fast-growing franchise segment combined with our asset-light model turned 14% revenue growth into adjusted net income growth of 27% and generated $94 million in free cash flow, a portion of which we utilized along with our expanding credit facility to return $271 million to our shareholders through a special cash dividend paid in December."

Investors likely expected more of the same in the year ahead, yet Planet Fitness issued a somewhat conservative outlook for 2017, including:

  • Total revenue between $405 million and $415 million, up 7% to 10% year over year
  • Systemwide same-store sales growth of 6% to 8%
  • Adjusted net income of $71 million to $74 million, up 5% to 10%
  • Adjusted EPS of $0.72 to $0.75, up 4% to 9%

Still, management remains optimistic as to the company's future.

"We ended the year with over 1.6 million additional members in 2016, many of whom had never belonged to a gym before, and the new year is off to a strong start," Rondeau stated in the press release. "We are excited to build on our current momentum in 2017 and over the long-term."

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