Slide 1: Q2 2023 Interim Report April-June 2023
Q2 2023 INTERIM REPORT APRIL-JUNE 2023 CEO SONDRE GRAVIR CFO CECILIE ELDE
Slide 2: Revenue growth of 12% in Q2 2023 and 13% in H1 2023
Revenue growth of 12% in Q2 2023 and 13% in H1 2023 (curr. adj.), driven by more members and higher yield Tight cost control has mitigated the inflationary pressure Another quarter with record-high profitability: Q2 EBITDA of NOK 194 million (NOK 83 million) and H1 EBITDA of NOK 332 million (NOK 113
Slide 3: Clubs and members by Nordic market
118 clubs and 319 000 members (6%2) 94 clubs and 245 000 members (7%2) 2 32 clubs and 70 000 members (10%2) 29 clubs and 81 000 members (4%2) 4 3 1 5 11 24 65 Greater Oslo Greater Helsinki 11 3 10 72 11 Greater Stockholm 12 2 1 7 29 Greater Copenhagen 1) Measured by 2022 revenues based on figures fr
Slide 4: Strong member growth over time
• Strong member growth over time, with a 6% increase y/y • The second quarter is typically a period with a decline in members due to lower sales • Both sales and drop-off in the quarter in line with historical comparables, resulting in a net member base decline of 3% Restrictions and imposed club cl
Slide 5: Robust megatrends driving activity levels and higher health awareness
~ ~ Robust megatrends driving SATS helping members activity levels and higher health succeeding with their awareness training Higher fitness membership penetration among younger generations - expected to keep those habits through life 5
Slide 6: No signs of weakened consumer sentiment within gym memberships
No signs of weakened consumer sentiment within gym memberships, which Weakening of additional sales, is the core business, constituting ∼80% of revenues constituting ∼20% of revenues Average membership price Sales of new memberships: Retail and PT sales: for new members (curr. adj.): The list price
Slide 7: Number of visits is the single most important KPI
NUMBER OF VISITS IS THE SINGLE MOST IMPORTANT KPI BOTH FINANCIALLY FOR SATS AND FOR THE PUBLIC HEALTH THE POWER OF DATA AND INDIVIDUAL MOTIVATION TO CREATE HABITS AND STICKINESS ‘Se pa dig selv iy Duer sé it et selv lebebndene fik en ce ‘ONTINUOUS | BRODUG, T INNOVATION alpue. SATS en BY IMPROVING T
Slide 8: Members keep breaking activity records
Δ Δ Δ • Our members keep breaking activity records, visiting us more and more often and improving their health • The increase is driven by both a growing member base and an increase in workouts per member 8 8
Slide 9: High activity levels at our clubs, also during the summer
• High activity levels at our clubs, also during the Summer • The significant increase in group training sessions proves the value of this product to our members 9 9
Slide 10: New club openings
• SATS Karlaplan (Q3 2023) • SATS Triaden (Q3 2023) • SATS Sluseholmen (Q4 2023) • SATS Hyllie Corner • ELIXIA Ratina (Q4 2023) • SATS DN Skrapan • SATS Kungsmässan (Q1 2024) • SATS Mölndal (2024) • SATS Haga Norra (2024) • Fresh Fitness Moss • SATS Spektrum 10 10
Slide 11: Like-for-like profitability regained, untapped earnings potential
Like-for-like profitability regained, but still untapped earnings potential by improving club economics Continue developing maturing clubs and signed greenfields, to reach target profitability Utilize the operational leverage and scale through club optimizations and overhead discipline Continue to e
Slide 12: Financial Review
FINANCIAL REVIEW RYT AY
Slide 13: Member base increase across all four Nordic countries
• Member base increase across all four Nordic countries during the past year, leading to a 4% increase in members per club • The second quarter is typically a period with a decline in members due to lower activity levels and sales • Both sales and drop-off in the quarter in line with historical pre-
Slide 14: ARPM improvement driven by membership yield increase
• ARPM improvement mainly driven by membership yield increase after price adjustments during the winter: • List price adjustment • Inflation adjustment • Minimum price adjustment • 8% curr. adj. membership revenue increase implies a membership yield-driven revenue improvement in the quarter of 76 mi
Slide 15: Revenue progression continues in Q2
• In line with expectations, progression in revenues continues in Q2 (+12% curr. adj.), mainly driven by membership revenue increasing by 16% (curr. adj) year-over-year • Strong revenue development across all four Nordic markets • Other revenues somewhat weakened 15 15
Slide 16: Cost base addressed through profitability improvement program
Total operating costs (MNOK)1 - whereof like-for-like club costs - whereof overhead costs • Cost base addressed through profitability per club (MNOK)1 improvement program, gradually coming into effect • Low overhead cost in Q2 due to normal seasonality effects (vacation), but continues to come down
Slide 17: Strong operational performance and actions to regain profitability
• The strong operational performance over the past year and our actions to regain profitability have yielded results: • Focus on regaining the member base, with significant member growth during over the past year • Successful price adjustments of new and existing members • Group-wide profitability p
Slide 18: Lower upgrades and maintenance capex in the second quarter
• Lower upgrades and maintenance capex in the second quarter, due to a precautionary spending approach • Expect pick-up in investments in H2, returning to 5% of revenues • Moderate club expansion, with further additions still temporarily paused due to the current macroeconomic climate 18
Slide 19: Cash flow and liquidity position
• Negative impact from working capital of NOK 106 million reflects the seasonal • Satisfactory liquidity position to handle current settlement of deferred liabilities, mainly related to holiday pay in Norway operations and communicated expansion strategy • Continue proving the cash generative abilit
Slide 20: Stable net debt, leverage significantly down
• Stable net debt, but leverage significantly down with increasing earnings • Historically, we have shown strong cash generation capabilities and stable cash conversion, resulting in a strong deleveraging profile • Expect to cancel the covenant waiver of the revolving credit facility ahead of expiry
Slide 21: Outlook
OUTLOOK RYT AY
Slide 22: Expecting an active second half of the year
Expecting an active second half of the year, with continued high visit levels Currently no impact of weakened consumer sentiment on the core business Anticipating continued steady member growth going forward, though not in line with the extraordinary covid-recovery years Yield expected to continue o
Slide 23: Appendix
APPENDIX RYT AY
Slide 24: Norway
NORWAY " COUNTRY EBITDA BEFORE IMPACT OUTGOING MEMBER BASE (000) ARPM AND YIELD (NOK/MONTH) TOTAL REVENUES (MNOK) OF IFRS 16 (MNOK) Hl MEMBERSHIP YIELD I MEMBERSHIP REVENUES Il OTHER YIELD Il OTHER REVENUES re 2%) 24 554 539 30% 99 an 41%) 322, 325550, sig 502 2 160 114 Q2 2022 Q3 2022 Q4 2022 Q1202
Slide 25: Sweden
SWEDEN " COUNTRY EBITDA BEFORE IMPACT OUTGOING MEMBER BASE (000) ARPM AND YIELD (NOK/MONTH) TOTAL REVENUES (MNOK) OF IFRS 16 (MNOK) Hl MEMBERSHIP YIELD I MEMBERSHIP REVENUES Il OTHER YIELD Il OTHER REVENUES 49% +17% (2% CURR. ADJ, (+10% CURR. ADJ), 552 20% 1b a 445% (+36% CURR. ADJ) 8s 58 Q2 2022 Q3
Slide 26: Finland
FINLAND " COUNTRY EBITDA BEFORE IMPACT OUTGOING MEMBER BASE (000) ARPM AND YIELD (NOK/MONTH) TOTAL REVENUES (MNOK) OF IFRS 16 (MNOK) Hl MEMBERSHIP YIELD Hl MEMBERSHIP REVENUES Il OTHER YIELD I OTHER REVENUES 72 431% o7 70 +18% (+12% CURR. ADJ.) 63 (2% CURR. ADJ.) +777% (+690% CURR. ADJ). Ng 13% 19 a
Slide 27: Denmark
DENMARK " COUNTRY EBITDA BEFORE IMPACT OUTGOING MEMBER BASE (000) ARPM AND YIELD (NOK/MONTH) TOTAL REVENUES (MNOK) OF IFRS 16 (MNOK) Hl MEMBERSHIP YIELD I MEMBERSHIP REVENUES Il OTHER YIELD Il OTHER REVENUES es er 82 84 al (+10% CURR ADJ.) (+15% CURR. ADJ) 78 537 133 99 o% Zz 9 a 2.2022 Q3 2022 Q4 2
Slide 28: Key figures
Amounts in NOK million Number of clubs, EOP 273 267 Outgoing member base ('000s) 715 671 Average number of members per club 2 618 2 515 ARPM (NOK) 552 502 Yield (NOK) 452 396 Reported EBITDA (MNOK) 491 342 EBITDA before impact of IFRS 16 (MNOK) 194 83 EBITDA before impact of IFRS 16 margin 16% 8% Co
Slide 29: IFRS 16 impact on financial statements
Amounts in NOK million Property, plant and equipment 702 0 702 Right-of use assets 4 452 4 452 0 Deferred tax assets 245 76 170 Prepaid expenses and accrued income 274 -86 360 T otal as s ets 9 009 4 442 4 567 Eq uity 976 -3 4 9 1 325 Non-current lease liability 3 894 3 894 0 Current lease liability
Slide 30: Definitions of alternative performance measures
Adjusted EBITDA before EBITDA adjusted for (i) closed clubs; (ii) certain comparability items; and Group overhead Consists of group services such as commercial functions, IT, finance and impact of IFRS 16 (iii) the impact of implementation of the IFRS 16 lease standard administration Average number
Slide 31: Cash flow items and definitions
EBITDA before impact of IFRS16 Profit before tax Depreciation, amortization and impairment Net financial items Installments on lease liabilities Interests on lease liabilities Maintenance capex Purchase of property, plant and equipment (contains both maintenance capex and expansion capex) Working ca
Slide 32: Calculated health effect of SATS members
• Calculated health effect of all SATS members who meet WHO’s recommendation of minimum 75-100 minutes of vigorous-intensity aerobic physical activity per week at SATS alone (World Health Organization, 2022) • Midpoint of 87.5 minutes applied • Assuming an average of 60 minutes per SATS workout • Me
Slide 33: SATS
SATS