- #AUTUMN 8 BILLING FOR MULTIPLE PROVIDERS ON SAME HCFA UPDATE#
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In 2018, our corporate-owned stores had segment EBITDA margin of 40.9% and had average unit volumes (“AUVs”) of approximately $ 2.0 million with four-wall EBITDA margins (an assessment of store-level profitability which includes local and national advertising expense) of approximately 46%, or approximately 39% after applying the current 7% royalty rate, which includes 1.59% royalty as a result of the elimination of certain rebates and commissions that were previously paid by all stores and deducted as an expense in arriving at four wall EBITDA. Under signed area development agreements (“ADAs”) as of December 31, 2018, our franchisees have committed to open more than 1,000 additional stores. According to internal and third-party analysis, we believe we have the opportunity to grow our store count to over 4,000 stores in the U.S. Our stores are successful in a wide range of geographies and demographics.
Of our 1,742 stores, 1,666 are franchised and 76 are corporate-owned. System-wide sales for 2018 include $ 2.6 billion attributable to franchisee-owned stores, from which we generate royalty revenue, and $ 137.9 million attributable to our corporate-owned stores. Our judgement-free approach to fitness and attractive value proposition have enabled us to grow our revenues to $ 572.9 million in 2018 and to become an industry leader with $ 2.8 billion in system-wide sales during 2018 (which we define as monthly dues and annual fees billed by us and our franchisees), and approximately 12.5 million members and 1,742 stores in all 50 states, the District of Columbia, Puerto Rico, Canada, the Dominican Republic, Panama and Mexico as of December 31, 2018. We and our franchisees fiercely protect Planet Fitness’ community atmosphere-a place where you do not need to be fit before joining and where progress toward achieving your fitness goals (big or small) is supported and applauded by our staff and fellow members. and Canadian populations over age 14 who are not gym members, particularly those who find the traditional fitness club setting intimidating and expensive. This attractive value proposition is designed to appeal to a broad population, including occasional gym users and the approximately 80% of the U.S. We offer this differentiated fitness experience at only $10 per month for our standard membership.
#AUTUMN 8 BILLING FOR MULTIPLE PROVIDERS ON SAME HCFA FREE#
Our bright, clean stores are typically 20,000 square feet, with a large selection of high-quality, purple and yellow Planet Fitness-branded cardio, circuit- and weight-training equipment and friendly staff trainers who offer unlimited free fitness instruction to all our members in small groups through our program. Our mission is to enhance people’s lives by providing a high-quality fitness experience in a welcoming, non-intimidating environment, which we call the Judgement Free Zone, where anyone-and we mean anyone-can feel they belong. We are one of the largest and fastest-growing franchisors and operators of fitness centers in the United States by number of members and locations, with a highly recognized national brand.
#AUTUMN 8 BILLING FOR MULTIPLE PROVIDERS ON SAME HCFA UPDATE#
Unless legally required, we assume no obligation to update any such forward-looking information to reflect actual results or changes in the factors affecting such forward-looking information. These forward-looking statements are subject to a number of risks, uncertainties and assumptions, including those described in “Item 1A. Without limiting the foregoing, the words “anticipates,” “believes,” “estimates,” “expects,” “intends,” “may,” “plans,” “projects,” “should,” “targets,” “will” and the negative thereof and similar words and expressions are intended to identify forward-looking statements. Therefore, any statements contained herein that are not statements of historical fact may be forward-looking statements and should be evaluated as such. Such forward-looking statements reflect, among other things, our current expectations and anticipated results of operations, all of which are subject to known and unknown risks, uncertainties and other factors that may cause our actual results, performance or achievements, market trends, or industry results to differ materially from those expressed or implied by such forward-looking statements.
This Annual Report on Form 10-K contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”).