Basic-Fit 3Q24 trading update: sacrificing pricing for growth

This morning Basic-Fit reported its 3Q24 trading update. The quarterly updates provide less information than last year. It has repeated the FY24 guidance given on all its KPI's apart from the average yield per member. Initially it was guided at EUR 24.50 vs EUR 24.25 now. The reason is the lower priced membership and discounts given to attract members. Hence the YTD membership growth is slightly above our expectations. As of FY25 there will again be a new membership structure in line with communications at 1H24. It will increase prices for the comfort (EUR 6.99/week) and premium membership (EUR 7.99/week) and most importantly give weekly quoted prices instead of monthly to underline affordability. In France the changes are already implemented. 168 clubs have been opened YTD (incl RSG) and most RSG clubs have been converted to the BFIT brand. In the short run we believe pressure on BFIT will continue given the difficulty in balancing the trade-off between growth and a healthy balance sheet. The launch of the franchise platform in FY25 could however increase the cashflow generation to deleverage the company. In the long run we repeat our EUR 30.0 TP and accumulate rating. Analyst call at 10.00 CET.