Bannatyne Group reports £14m loss as pandemic closes gyms and other venues


The health club chain run by former Dragons’ Den star Duncan Bannatyne reported a loss in its latest set of accounts.

Darlington-based Bannatyne Group has a chain of 69 gyms, 47 spas and a number of hotels across the UK, having opened the first site in Teesside 25 years ago and growing the number of its members to more than 210,000.

But the pandemic forced the entire network of health clubs and spas to close for several months, pushing the business to an operating loss of £13.9million in 2020.

Read more : go here for more economic news

The accounts also reveal that the company’s workforce has fallen from an average of 3,285 to 2,990, despite having appealed for government support in the form of a £14.24 million grant sterling for the coronavirus retention scheme as more than 90% of the company’s staff have been made redundant.

Since the end of the year, the group said it had drawn a second CLBILS (Coronavirus Large Business Interruption Loan Scheme) loan for £12million.

Manager Ed James said in his report that the Covid-19 pandemic led to the prolonged closure of all his health clubs and hotels after the first lockdown in March 2020, describing how they remained closed until July in England and August in Scotland. They were then closed during a second lockdown and as Tier 4 restrictions continued to keep venues closed in London and the South East.

Mr James said the company had invested heavily in PPE and implemented strict social distancing and cleaning policies, with its Covid-19 emergency response team drawing up detailed plans prepared both to close all its sites but also to ensure that they could open in a safe. and securely.

In his report, he said: “We have furloughed over 90% of our employees across the group (including all health club and hotel employees) to protect the financial situation of the group during our forced closure. .

“Directors considered the impact of severe but plausible downside scenarios, including a further spike in Covid 19 infection rates that halts rebuilding of the revenue base for a three-month period. In this scenario, the group still expects to have sufficient liquidity and to respect its banking covenants. A new nationwide lockdown has not been modeled as this is no longer considered a plausible scenario. »

After the release of the accounts, the company said, “These results are fully expected and reflect the effects of the pandemic.”

Duncan Bannatyne, the group’s chairman, started the Bannatyne group after he had a skiing accident and needed regular exercise to recover. He couldn’t find any facilities there and decided to use some of the proceeds from the sale of his former business, Quality Care Homes plc, to start the fitness chain.

In the financial year, in November 2020, Mr Bannatyne wrote to MPs advocating for the reopening of gyms and health clubs, telling them how exercise improves mental health and the need to fight against obesity was hampered by the closure of health clubs during the winter months.

He asked for a compromise amendment to allow some facilities, including gymnasiums, to reopen – but the tiered system of restrictions that followed led to their continued closure.

The group is set to open a luxury ‘express spa’ at Teesside Airport as its latest venue this year.


Comments are closed.