Yahoo Finance UK gym bosses voice concern over '£500,000 a day' lockdown cash burn
Gym chains have voiced their concerns about cash burn under lockdown, as one chain said UK shutdowns were costing them £500,000 a day.
Budget franchise PureGym told the BBC it had calculated the average cost over eight months of closure to tot up to half a million pounds.
Gyms have been among the worst hit businesses during the pandemic, and many have been shut for a large portion of the last year, as fears of spreading the virus led to widespread lockdowns.
CEO Humphrey Cobbold said the business has been hit with around £120m in costs, with no revenue coming in.
The Gym Group (GYM.L) also recently announced that its monthly cash burn during the current COVID-19 lockdown is £5m ($6.8m), while the November closures cost £6m. The group said that 45% of last year’s trading days had been lost due to government restrictions.
The troubling calculations come as prime minister Boris Johnson is set to unveil a path out of lockdown for the UK later on Monday.
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The prime minister is due to set out how restrictions will be gradually eased in a speech in parliament, due at 3.30pm local time.
Schools are set to reopen and outdoor socialising with one other individual will be allowed first from 8 March in the first of four stages of lifting curbs. Two households or six people are likely to be allowed to meet outdoors from 29 March.
Johnson said in advance of the speech his approach would be "cautious," and said each stage would only occur once four key tests had been met.
The tests include the continued success of the vaccine rollout, evidence it is reducing hospitalisations and deaths, infection rates being low enough to prevent surging hospitalisations, and no change to government risk assessments from new "variants of concern."
Cobbold told the BBC's Today programme: "The sooner the better within safe operating procedures for us. We can make a massive contribution to the health of the nation"
READ MORE: Gym group Virgin Atlantic poised to implement restructuring
The news comes following reports at the end of January that a restructuring is on the cards for gym chain Virgin Active, as its owners ponder blueprints to help it weather the coronavirus pandemic.
According to reports by Sky News on Saturday, at the time, the chain had brought in about half a dozen banks and advisers to look at how the company could be restructured, as lockdowns hamper its ability to make money.
Richard Branson’s Virgin Group is a minority shareholder in what has grown to be one of the UK’s largest fitness brands.
A booming home workout industry has emerged while gym-goers wait for the green light to return.
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