Smartfit (SMFT3) Q3 2024 earnings summary

Executive summary

• Added 285 clubs in the last 12 months, reaching 1,591 units in 3Q24 across 15 countries, up 22% vs. 3Q23.

• Member base grew 17–18% year-over-year to over 5.2 million in 3Q24.

• Net revenue rose 31% year-over-year to R$1,422 million in 3Q24, driven by a 19% increase in average members and an 11% rise in average ticket.

• Record EBITDA of R$442 million in 3Q24, up 35% year-over-year, with a margin of 31.1%.

• Recurring net income reached R$124 million, a 22% increase year-over-year.

Financial highlights

• Net revenue for 3Q24 was R$1,422 million, up 31% year-over-year and 5% sequentially; 9M24 net revenue was R$4,040 million, up 30% year-over-year.

• EBITDA margin reached 31.1% in 3Q24, up 1.1 p.p. year-over-year.

• Recurring net income margin was 8.7% in 3Q24.

• Operating cash flow was R$379 million (+21% YoY), with EBITDA-to-cash conversion at 86%.

• Capex of R$454 million in 3Q24, mainly for network expansion.

Outlook and guidance

• Raised 2024 guidance to 280–300 net club openings, a 35% increase over 2023, reflecting robust expansion and favorable real estate opportunities.

• Club network expected to grow 20% versus end-2023, supported by strong returns from recent openings and solid mature unit performance.