Smartfit (SMFT3) Q2 2025 earnings summary

Executive summary

• Achieved 19% year-over-year growth in club network, reaching 1,818 units across 15 countries, with guidance for 340–360 new openings in 2025 and 80% expected to be owned units.

• Net revenue rose 32% year-over-year to R$1.8 billion in 2Q25, with EBITDA reaching a record R$576 million and recurring net income up 32% to R$189 million.

• Operating revenue for H1 2025 was R$3.47 billion, with net profit rising to R$281.8 million.

• Major acquisitions included full control of FitMaster LLC in the US and Brasfit Academia de Ginástica Ltda in Brazil, strengthening international and domestic presence.

• Bioritmo brand is experiencing renewed growth, with a pipeline of 10 new stores this year, and the first unit in Morocco is expected to open.

Financial highlights

• Cash gross margin reached a record 50.9% in 2Q25, up 0.9 p.p. year-over-year, and EBITDA margin was 32.1%.

• Operating cash flow was R$521 million in 2Q25, with 90% EBITDA conversion.

• Earnings per share (basic) rose to R$0.4726 from R$0.3178 year-over-year.

• Maintenance capex for the last 12 months was R$290 million, 7.1% of net revenue from mature units.

• Maintenance OpEx for mature units averages about 3% of net revenue.

Outlook and guidance

• Guidance for 2025 remains 340–360 new club openings, a 15% increase over 2024, with 80% as owned units.

• CapEx reduction initiatives in Brazil are being extended to Mexico and other countries, aiming for long-term growth in line with inflation.

• Recent borrowings in Peru, Colombia, Panama, and Paraguay will fund further gym expansion projects.

• The Group remains compliant with all financial covenants and expects to maintain strong liquidity.

• No acceleration planned for franchise buybacks; focus remains on opening new stores to increase capillarity.