Health: Shredded Viva Leisure hits the gym and beats prospectus forecasts

Viva Leisure (ASX:VVA), owner of a range of gyms and leisure centres, had an extraordinary 2019 financial year, with profit more than doubling on the back of tripled revenue.

Shares in the company, which added around $8m to its market cap on Wednesday morning, rose as much as 14 per cent to $1.30. It listed in early June after raising $20m.

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Total revenue hit $31.2m for FY19, up 310 per cent on 2018’s $7.6m. That led to a full-year profit of $2.9m, a 112 per cent improvement on last year’s $1.3m.

Revenue was slightly down on the prospectus forecast of $32.9m, but profit exceeded forecasts of $2.7m.

Harry Konstantinou, Viva’s CEO, said the result was achieved on the back of business expansion.

“Over the past 12 months, my team and I continued Viva Leisure’s growth trajectory by doubling the number of locations, at the same time increasing membership by over 50 per cent,” he said.

“Today we have delivered a solid set of financial results for our shareholders, while continuing to build the business to be fit and strong for the future.”

When factoring in a restructure of the business however, the financial figures look significantly different: revenue of $33.1m, only a 37 per cent improvement on FY18, and profit of $3.2m, up only 47 per cent on the prior year.

In other ASX health news today:

1st Group (ASX:1ST) falls on results. Shares dropped 11 per cent to 6.7c despite what the company described as a “successful year”. Revenue grew slightly to nearly $4m, and the full-year loss narrowed from $4.6m to $4.3m. It expects recurring revenue to grow 27 per cent in the first half of FY20.

Starpharma (ASX:SPL) fluctuates on trial, financial news. The company reported positive safety and efficacy data from its Phase I/II trial testing its drug in patients with cancer. However, its revenue fell 45 per cent and its full-year loss increased. Shares fluctuated between lows of $1.11 and highs of $1.21.