THE RISE OF THE BOUTIQUES

THETRIB3BUSINESSPLAN

Spain

STUDIOBOOTCAMP

35

Responsible for driving operations, setting

operational strategy and vision and providing

direction by drawing on experience of over 20

years in the health and fitness industry at

senior executive/boardlevel.

With invaluable experience of being on the

founding board of the high-end boutique studio

1Rebel – Kevin brings an eye for detail and an

ability to drive the high standards required to

maintain the drive for World Class status.

1Rebel – Director/Investor – 2 yrs

Leisure Connection – LeisureDirector

–7 yrs

Esporta – National Manager – 2 yrs

Fitness First – National Manager – 11yrs

Multi-award winning Architect and property

developer responsible for driving design and

delivery of all the stores from conception to

completion, setting design strategy across the

brand manual by drawing on experience of

over 15 years in the construction sector.

A keen eye for detail and an ability to drive the

high standards required to maintain the drive

for World Classstatus.

CODA Group – Managing Director – 16 yrs

Crossbow Group – Managing Director

–4 yrs

Responsible for driving sales, setting sales

strategy and providing vision and direction by

drawing on experience of over 15 years in the

health and fitness industry at senior executive/

board level,

Bringing significant experience of design and

implementation of sales and operational

processes within a global fitness brand. A

natural presence and entrepreneurial flair

promoting a strong focused drive for World

Class status.

Be X Fitness Group – Managing Director

–6 yrs

Leisure Connection – National Fitness

Manager – 3yrs

Fitness First – Group GeneralManager

–5 yrs

Rod was a director of Fitness First group and

help grow the business from 1 club in 1992 to

over 400 clubs in 17 countries over 11 years

which was the largest owned chain of clubs in

the world.

A veteran of the fitness industry with 27 years

experience in the sector who has developed

start up businesses in Europe including Spain,

France, Italy and Benelux.

Founded Anytime Fitness in Spain the worlds

number 1 franchise 2015. He grew the chain

to 30 clubs in three years creating the largest

franchised gym chain in Spain

Rod will now be MD of Europe for TRIB3

international.

Fitness First – Director – 11 yrs

Anytime Fitness, Spain – Founder – 3yrs

KEVINYATES

CEO&CO-FOUNDER

DAVIDCROSS

PROPERTYDIRECTOR&CO-FOUNDER

DANIELSUMMERSON

SALESDIRECTOR&CO-FOUNDER

RODHILL

MANAGINGDIRECTOREUROPE

BUSINESS PLAN MANAGEMENT TEAM – TRIB3 INTERNATIONAL

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TO BE THE LARGESTBOUTIQUE OPERATOR IN EUROPE BY2020,

LEADING THE CHANGE IN THE INDUSTRY

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WORLD CLASS IN EVERYTHING WEDO

TO ENRICH THE MOVEMENT AND LEAD THETRIB3

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BUSINESS PLAN BUSINESS OVERVIEW

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COMPANYINFORMATION

TRIB3 is a unique boutique boot camp studio offering High

Intensity Interval Training (HIIT) workouts, in industrial luxe

surroundings.

One studio, HIIT classes with three elements (TRI) Treadmills,

Resistance, Intensity, world-class coaches and a luxury shake

bar and retail experience.

The aim is to create a new movement in fitness based around a

community of likeminded discerning consumers who are looking

for something that fuses fitness and leisure with unparalleled

service.

HISTORY

Established in June 2015, TRIB3 currently has 3 sites in the UK,

Sheffield (Ecclesall Road, Kelham Island and Meadowhall) with

negotiations underway for sites across the UK, Europe and

beyond.

TRIB3 has established 3 core models; suburban, urban and

out-of-town in a range of sizes from 250 m2 to 500 m2. This

allows flexibility in the business model from wholly owned,

franchised, licensed and joint ventures creating the potential for

rapid global expansion.

Within twelve months of operating TRIB3 has over 15 live UK

franchise negotiations underway with advanced talks to take the

brand to both Russia and Spain in established fitness markets.

Operating from small (250 m2 to 500 m2) venues with low start

up costs (approx. €150,000 – €350,000) with an expectation of

being able to achieve EBITDA of between €80-150,000 in the

second year, showing between 40-50%ROI with a payback of

less than 3y.

BUSINESS PLAN BUSINESS OVERVIEW

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WHATMAKESTRIB3DIFFERENT

TOOTHERBOUTIQUES?

TRIB3 venues are designed by awarding winning Architects CODA

Studios ensuring that every site has the same look, feel and

attention to detail whilst playing on the specific Architectural

features of each unique location to create a family of designs.

The journey through the club has been carefully curated from

the first step on the red carpet through the corridors and

changing facilities, the social space and studios to create a user

experience to stir all the senses. Carefully positioned candles,

dimmed lighting, tactile surfaces and a welcoming team all

ensure the consumer returns again and again.

The social space has the specific aim of forging a strong

community feel and by creating a focal point around the luxury

shake bar this encourages members to hangout both before and

after classes. The regular special event nights further enhance

the power of the group through themed workouts all rewarded

by a glass of Prosecco to cool down.

Attention to detail matters at TRIB3, from the professionally

created music playlists and state of the art sound system to the

lighting and candles that create atmosphere and fragrance.

The changing facilities offer luxury surroundings including

complimentary toiletries – from shampoo and conditioner, to

hair bobbles, sanitary products and GHDs. A luxury towel hire

service is further complimented by the chilled lavender scented

face towels for use after each class. A truly unique experience!

TRIB3 operates mainly as ‘pay-as-you-go.’ However membership

options are available in the ‘Elite’ programme offering an

approach to suit most people.

Online bookings through the website or APP make TRIB3 a

virtually cashless environment making the experience seamless

from start to finish catering for the time poor/cash rich

consumer market.

Being ‘Instagrammable’ is what drives the thought behind the

detail at TRIB3 – will someone want to take a picture and share

it? If not, it’s either not good enough or it’s not needed.

The TRIB3 Journey inspires motivation, provides encouragement

and promotes inclusion. The purpose is to create a feeling of

being part of the movement.

The journey includes:

First Visit: #HIT THEWALL

Hit 7 workouts in 7 days: #STEEL

Hit 50 workouts in 5 months: #WARRIOR

Hit 100 Workouts: #IMMORTAL

Monthly Membership Programme: #ELITE

Community Outreach: #TRIBALGAMES

Analysing the reasons behind why people exercise and why a

programme will work is crucial. TRIB3’s resident psychologist Dr.

Helen Quirk evaluates and assesses each programme, ensuring

they are designed specifically with exercise psychology in mind.

TRIB3 is already recognised as one of the best five workouts

(The Telegraph, April 23rd, 2017)

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Staffing requirements per siteinclude:

Store Manager: responsible for the overall management of

the venue including maintenance of standards, sales, social

media, studio and reception.

Controlling budgets and financial planning, teaching approx.

20 classes per week

Reception Manager: responsible for maintaining the high

standards in the reception area, management of bookings,

ensuring meet and greets are professionally carried out

and club tours are delivered according to the process,

completion and management of the club waiver,

reassurance and introductions for first timer users, closing

sales where necessary. Controlling stock and merchandise.

Bar and Events Manager: responsible for maintaining

standards in the bar area, development and promotion

of new/current shakes, development and promotion of

monthly events. Controlling stock.

Bar/Reception/Service Team: a multi tasking role, moving

between reception, bar and service as required. Responsible

for checking in clients, prepping shakes, checking stock and

salescalls.

Coaches: mainly freelance, responsible for delivering

high energy, engaging and tough yet fun TRIB3 classes.

Developing new ideas for keeping the classes fresh and

building strong relationships with customers.

Hygiene Assistant: responsible for maintaining the high

standards of cleanliness in the venue.

Our unique culture and position in the wider community has

already proven that TRIB3 attracts the best applicants, many of

whom have sports and fitness backgrounds often to degree

level. This fused with experienced retailers and other customer

facing applicants further enhances the unique retail/fitness/

leisure offer not yet seen in this industry.

The TRIB3 approach to recruitment and training is second to

none – our coaches are expected to take part in a 12-week

intensive training programme before being selected as a TRIB3

Elite Coach. These positions are coveted and competition is high,

making our coaches some of the best in the business!

PEOPLE

ATTRACTINGTHERIGHTMEMBERS

OF STAFFISKEYTO DELIVERING

THESERVICEREQUIREDATTRIB3.

ACAREFULLYSELECTED TEAM

ENSURESTHEHIGH STANDARDS,

PROFESSIONALISMAND ENERGY

REQUIREDTOCONSISTENTLY DELIVER.

BUSINESS PLAN OPERATIONAL PLAN

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FACILITIES

TRIB3 can operate in spaces of between 250 m2 to 500 m2. in

urban, suburban and out-of-town locations all of which will

require specific features based on the user demographic and

type.

Full demographic analysis is carried out for each proposed site,

allowing TRIB3 to identify locations that will attract the social

economic group that are vital to success of the venue.

Consideration has to be given to size of studio in comparison

to the locker, shower, changing and bar area provision. Our

in-house design team carefully considers all of this on a project-

by-project basis.

BUSINESS PLAN OPERATIONAL PLAN

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STUDIOEQUIPMENT

TRIB3 uses high quality, state of the art equipment that appeals to

the discerning consumer. However in comparison to a traditional

gym environment, the scale of equipment required is relatively

low, providing a low cost to launch and maintain venue.

StarTracTreadmillsmaximum 12 to cater for studio

occupancy of 36.

With quick start and quick incline functions they cater specifically

for the TRIB3 workout, allowing the user to maximize their time

and workout to their full potential.

ESCAPEFITNESS

Free weights a range of dumbbell sizes from5-15kg

Kettlebellsa range of sizes 12kg/16kg

MedicineBalls6kg

Step box used for Resistance basedexercise

BUSINESS PLAN OPERATIONAL PLAN

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SOCIALSPACEREQUIREMENTS

One of the key core components of each of our stores is the

SOCIALspace.

This open and relaxing zone is designed to create a space for the

consumer to mix, mingle and hangout with other TRIB3 users to

create human interaction unheard of in traditional gyms where

people often train alone with earphones connected to their

devices – many of our users have become close friends through

their shared experiences atTRIB3.

This space has the feel of a contemporary urban coffee shop, bar

or retailer with an eclectic materials palette.

Thisincludes:

– Reclaimed parquet flooring for the work tops of the shake bar

– Exposed block work or corrugated cladding

– Galvanized Mesh hanging frames for fresh herbs and produce

– Feature industrial pendant lighting

– Exposed filament bulbs

– Belfast sink full of ice stocked with local beers or prosecco

– Opaque glass walls for our ever changing shake menus, special

offers and motivational quotes – handwritten notes by the team

to create an informal and relaxed artistic approach to signage

– Distressed leather seating with iPhone/USB charging points

– Palette wood coffeetables

– Polished concrete or tiled floors

– Industrial stools

– Projector for black and white movies and imagery

– Scaffold plank and clamp-it shelving with display produce

– Kilner jars with fresh cucumber water

– TRIB3 Milkbottles

– iPads – used to enable customers to sign up for an account,

book sessions; encourage the cashlesssystem,etc.

– Apple Laptops – used to enable management of the Mind

Body system for booking in customers, managing payments

and accounts etc.

– Retail offers for clothing and other apparel

THESOCIAL SPACEISALSOKEYTO

OUR TRIBALGATHERINGAND OTHER

EVENTSCREATINGAFREEFLOWING

ENVIRONMENTTOLINGERANDCHAT.

BUSINESS PLAN OPERATIONAL PLAN

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PROCESSES

Music

The music in the studio is an essential part of the ‘theatre’ of

TRIB3. Unique playlists are created on a monthly basis complete

with the signature TRIB3 boxing bell between rounds.

We choreograph and synchronize warm up music with soft blue

tones in the lighting through to intense reds and explosive drum

beats in the intensity zone – all this culminating in a soft R&B

close out to Stevie Wonder whilst the consumer stretches and

cools down with our chilled, wet face towels!

The lighting, music and workout programming are all

carefully designed to yet again stir the senses beyond that

of a normalworkout.

MindBody

The operating system is provided by Mind Body allowing TRIB3

to link the website, APP and management systems.

Customers benefit from a seamless service with an ability to

book classes, make payments and buy shakes through the APP.

BlackEyeProject

Ensuring uniformity and brand identity is key and with this in mind

all design and marketing is prepared by our trusted partner The

Black Eye Project. Using their award winning creative flair they

have partnered with us on design for everything from the website

and app to the weekly tiles for use on social media platforms.

XeroAccountingSoftware

Xero is a cloud based accounting system, which allows access at

anytime, anywhere. Providing real time accounts information all

from an APP creating fiscal transparency at all times to the senior

management team, franchisees and partners.

BUSINESS PLAN OPERATIONAL PLAN

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BUSINESS PLAN MARKET ANALYSIS

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TARGETSECTOR

Millennials are the target customer sector for TRIB3. With an

age demographic of 20-50s they make up a quarter of the UK

population and are predicted to hit the 17million mark by 2017.

More millenials than other sectors view fitness as an affordable

luxury and they are driving the social media culture and

promoting the sense of sharing, community and movement that

TRIB3embrace.

‘Group exercisers are 26% less likely to cancel than gym-only

members; there’s something unique about group exercise that

leads to better retention that’s not fully explained by gender,

age, membership length, club history or visit frequency.’

Source Dr Melvyn Hillsdon,

Associate Professor of Exercise and Health, University of Exeter.

TRIB3 is almost for everybody …

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BUSINESS PLAN COMPETITION

1Rebel has 2 sites in London offering 2/3 classes in 2/3 studios

(depending upon the location). The club is of exceptional finish

and offers added theatre with live dj’s and pyrotechnics.2

PricingStructure

Number

ofclasses

Price

£s

1 20

3 95

5 180

10 255

20 400

Strengths Weaknesses

High end fit out High cost per site

Large space

requirement

Difficult for

scalability

Three studio offer

(morevariety)

Three studio offer

(not a specialist)

BrandEquity Expensive

to workout

(no room

for

reduction

unless the

brand/fit out

costschanges)

Cash generating

business

Expensiveto

launch

1REBEL– EST.2013

COMPANYVALUATION£14MILLION

TRIB3’s Similar Competition

Barry’s Bootcamp has 28 Studios in total mainly based in the

U.S.A. with 2 London locations. This is a single studio approach

with a low cost, basic fit out. Classes are 60 minutes in duration,

with 30 mins cardio and 30 mins strength training.

PricingStructure– London:

Classes are cheaper the more you buy, totally flexible and

transferable to family or friends, valid for 1 year after purchase.

Number

ofclasses

Price

£s

1 20

3 59

5 95

10 180

15 255

20 340

30 480

50 750

Strengths Weaknesses

Low cost fit out Lack of visibility

outside

of

London

Excellent

Programming

Mainly focused

on U.Smarket

Established

brand

Singularized

product

BARRY’S BOOTCAMP –EST.1998

COMPANYVALUATION:£100MILLION

LN

USA, LN25

BUSINESS PLAN COMPETITION

TRIB3’s Other Competition

Number

ofclasses

Price

£s

4 per month

8 per month

unlimited

Only

monthly

options

Strengths Weaknesses

World wide brand American style

800 locations

And strong

franchise base.

Model not well

designed for

Europe

Leader in market Not known in

Europe

Strong private

equity franchise

Investors Rourke

Capital.

Small group

personal training

Group dynamic

Conventional gym

environment

Month to month

payment options

only and no

session only

payments.

Inexperienced

management team

in Spain

Expensiveto

launch

One of the first gym boutique models and market leader with over

800 franchise locations worldwide. Month to month packages and

no session package options.

PricingStructure

ORANGE THEORY – EST.2007

LOOKING FOR AN IPO

Soul Cycle have 71 Studios in the U.S.A, the classes are indoor

cycling with added hand weights and core work. There is a choice

of 7 different classes ranging between 45 – 90 minutes, with a

teen (ages 12 and above) version also on offer.

PricingStructureNYC

Pricing varies depending upon the location:

Number

ofclasses

Price

$s

1 35

3 75

5 165

10 320

20 600

30 850

Strengths Weaknesses

Establishedbrand Lack of visibility

outside of USA

Celebrity

Association

Specificallyaimed

at USmarket

Singularized

product

SOUL CYCLE–EST.2006

COMPANYVALUATION:£750MILLION

USAUSA …

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BUSINESS PLAN PRODUCTS AND SERVICES

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THECLASS

TRIB3 specialise in ONE class in ONE studio with THREE

variations:

– FullBody

– Upper Body

– Lower Body

This enables the Elite Coaches to totally focus on developing

incomparable sessions that leave customers feeling that they’ve

had an intense, unique world-class workout.

Each class has 3 elements Treadmills, Resistance and Intensity

(T-R-I) – delivered in 45 minutes. Careful consideration has been

given to the structure and design of each session with an aim of

burning up to 1000 calories per class.

The treadmill section is designed to challenge the trainees

aerobically. The aim is to push them hard with every Treadmill

section concluding with trainees hitting near maximum heart

rate in a combination of sprints and hill climbs.

The resistance section is about lifting weights and working

anaerobically. The coaches encourage the trainees to lift

heavier than they would elsewhere while maintaining form and

correcting poor technique.

The intensity zone is about energy. Dynamic plyometric moves

using bodyweight or Kettlebells/Medicine Balls. Stepping away

from the standard burpees and mountain climbers. The best

coaches will deliver new exercises our trainees have never

encountered at other fitness clubs in ways the consumer has

never imagined.

To help customers to track their effort during a class TRIB3 have

partnered with MYZONE.

MYZONE is an innovative heart rate based system that uses

wireless and cloud technology to accurately and conveniently

monitor physical activity. It monitors heart rate, calories and

time exercising that converts into MYZONE Effort Points (MEPs),

with a focus on rewarding effort rather than fitness. Our studios

are fitted with screens that connect to anyone who is wearing

a MYZONE belt and the results are displayed, encouraging

competition and motivation.

TheTRIB3ethosissimple– No workout iseverthesame!

BUSINESS PLAN PRODUCTS AND SERVICES

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SHAKES

On offer is a range of shakes for both pre and post workout,

using fresh fruit, protein and almond milk to aid muscle recovery

and replenish energy.

Customers are encouraged to buy both pre and post workout

from pre-stored payment information removing the need for

cash to change hands.

Each shake is freshly made and presented in our TRIB3

branded takeaway cups or in one of our branded classic glass

milk bottles. The desire to be seen with TRIB3 merchandise is

further enhanced here as all shakes are personalised with the

customer’s name and/or a small drawing for example a heart or

a kiss. Our team are encouraged to be creative as this shows

care and attention todetail.

CLOTHING –RETAIL

TRIB3 offer a fully branded, on-trend range of clothing and

merchandise displayed in the retail/social space. The range is

further enhanced by additional limited edition offerings relating

to event nights/charity initiatives or to promote a customers

dedication, for example when they hit 50 workouts.

Our Elite range provides each user with their own unique TRIB3

number that is theirs for life, further ensuring the consumer buy-

in of the brand and pride to have made it to Elite. Just another

step in their fitness journey with TRIB3.

TOWELS&FACECLOTHS

Luxury 600 gram Egyptian cotton towels are available to hire and

scented/chilled face cloths are provided at the end of each

workout, creating an experience which can be compared to

diving in a pool on a hot day –refreshing, revitalising and unique.

Our towels are oversized to suit the larger user – again showing

that everyone matters at TRIB3.

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SESSION CREDITS

Bulk buy your workouts to get the best possible

price. One credit = one session, and you can even

share your sessions and gift them to a soon-to-be-

sweaty friend.

STEEL WEEK

TRIB3. At special times within the month we offer

you the chance to get onto the converted #wall of

Steel. Starts on a Mondays within a month these

weeks are called STEEL WEEK. This amazing 7-

day STEEL package is from a Monday - Sunday,

once a day for only £40.

WARRIOR

To become a Warrior at TRIB3 you have to

complete 50 sessions . Sound’s easy ? Then make

the commitment and purchase the 50 pack for a

discounted rate - The pack or sessions have to be

completed within 5months OR WILL EXPIRE - Can

you complete the challenge and go onto the

converted #WARRIORWALL

TRIB3 ELITE

20 sessions per month, full dietary support

throughout the program. Weekly check ins with the

ELITE coaches, measurements and food goals at

the start and after every 4 weeks on the program.

SERIOUS RESULTS! Join TEAM ELITE!

Our Prices

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BUSINESS PLAN SALES AND MARKETING

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Sales and Marketing is aimed at the target sector of millennials

and as such is wholly concentrated on social media platforms.

The focus is image lead, with strong branding and design.

Each site manager is responsible for daily posts on Facebook,

Instagram and Twitter with a head office account for posting

group messages.

The marketing focus is driven by the mantra ‘the toughest

workout in the North’ where hard work and determination are

rewarded and shared.

By posting group photos, uploading videos and live streaming

classes the TRIB3 community increase our marketing reach by

onward sharing.

andboutiquestudios.

NETPROMOTERSCORE

In just 12 months TRIB3 have an unprecedented NPS score OF

66 equal to that of Apple and American Airlines and over sixty

5* reviews and more importantly no review lower than a 5*.

This demonstrates the drive and determination to continue to

meet and exceed customer expectations. Normal fitness clubs

languish in the lower 30s in terms of NPS showing TRIB3 is light Analysisof socialmediareviewsfor arangeof gyms

years ahead of thecompetition

Company Noofreviews *Rating

TRIB3 90 5

1Rebel 81 4.9

Barry’s Bootcamp 234 4.7

Virgin 111 4

Core Collective

Psycle

Another

Space Pure

Gym

32 4.9

108 4.8

43 5

Unknown 3.9

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BUSINESS PLAN OUR TEAM – Focus on Retail, Growth and Management

A senior team with a wide knowledge of the International fitness market with also a strong understanding and experience of both the technology and retail sectors. The team also provides strong financial and strategic management skills and experience.

Rod Hill – CEO and Partner at TRIB3 EUROPE

• Founder director of Fitness First, the worlds largest fitness chain that developed over 500 fitness clubs across 22 countries. Joined in the first club in 1992 and oversaw the expansion internationally to 500 clubs in 12 years. Was involved in two IPOs during this time first on the AIM market in 1996 and a full listing on the LSE in 1998. By then, €500M revenues and market cap of €1Billion at its height.

• Founder and CEO of Anytime Fitness Spain. World largest fitness franchise with over 3.500 clubs worldwide. Developed over 30 clubs in four years and created the largest franchised chain in Spain. Brought the brand to Spain and made the changes needed to make the model successful throughout Iberia. This included developing all aspects of the franchise back office and support , real estate and building.

• Founder Viva Gym Spain. Brought the first low cost model gym to Spain with British backed chain Pure Gym and creates a Spanish version to rollout throughout Spain. Backed by Magenta Partners private equity Viva Gym was the first low cost model to appear in the market and now has 22 clubs in Spain and many copies.

Kevin Yates – Founder and CEO of TRIB3 Group.

• Kevin has developed a vast experience in leisure and fitness management and

operations of more than 20 years. 10 years at Fitness First as group fitness director. Leisure connection, as director of 120 club public facilities chain in the UK owned by private equity company Electra Partners. Fitness Director at Esporta, another publicly listed fitness group in UK

• Founder of 1Rebel, the first London based boutique with the founder of Fitness first Mike Balfour. Three years perfecting the boutique model and design concept.

• Co founder of Trib3. After developing 1 rebel Kevin decides that the model had to be more affordable to be able to make it more replicable and an attractive franchise concept. Founded TRIB3 by keeping the best of 1 rebel but reducing fit out costs while still maintaining a cool and unique boutique club experience.

Joaquin Gali – CFO and Partner at TRIB3 EUROPE.

• Joaquin has a large experience of more than 20 years in managing companies as a CEO and MD in Technology and Telecom

industries with an intensive focus in finance and strategy. 34

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BUSINESS PLAN PARTNERS

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OVO

Ovo are our chosen UK partner for delivering a turn-key solution

to each club, from the physical built environment to the ice in the

machine – Ovo have worked closely with our team to deliver an

inventory approach to our fit-outs to allow a seamless and

integrated understanding of our needs.

THEBLACKEYEPROJECT

The Black Eye Project is our chosen partner for delivering design

and branding across the TRIB3 portfolio. Working closely with

the TRIB3 senior team The Black Eye Project have created a

strong brand identity which they continue to promote through

development of regular marketing campaigns and materials.

LIGHTMASTERSUK

Imaginative, flexible lighting is key to the theatre of TRIB3 and

with that in mind Lightmasters UK are our chosen partner.

Working with our in-house design team and senior leaders

Lightmasters UK have created a responsive and spectacular

lighting system that perfectly compliments the TRIB3 workout.

ESCAPEFITNESS

As an industry leader in the design and supply of great looking

equipment, Escape Fitness is the natural choice to partner us in

our expansion of TRIB3.

COREHEALTHANDFITNESS

Core Health and Fitness is our chosen partner for the

provision of studio equipment. The high quality, responsive

Star Trac treadmills are perfect for the high intensity TRIB3

workout sessions and the strong working relationship ensures

consistency in roll out across the TRIB3 portfolio.

MYZONE

Our partner of choice for helping our customers to monitor their

effort levels isMYZONE.

MYZONE is an innovative heart rate based system that uses

wireless and cloud technology to accurately and conveniently

monitor physical activity. It monitors heart rate, calories and

time exercising that converts into MYZONE Effort Points (MEPs),

with a focus on rewarding effort rather than fitness. Our studios

are fitted with screens that connect to anyone who is wearing

a MYZONE belt and the results are displayed, encouraging

competition and motivation.

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BUSINESS PLAN FINANCIAL SUMMARY

41

The financial model is based on a club reaching maturity within

c.18 months of opening and then plateauing out, with costs

arising in a consistent way for different sizes of club.

Due to the way in which memberships and block purchases are

made, a club is expected to become cash-generative on a

monthly basis from the first quarter onwards, assuming that fit-

out costs are all incurred and paid for prior to opening. Although

the initial investment is sizable for each club, it is expected that

the initial investment achieves payback within over Year 2 and

then continues in a cash-generative manner going-forwards,

despite some seasonalmovements

The financial profile of the Joint Ventures is deemed to be

consistent with the wholly owned clubs. The franchise model

offers a lower overall return but instant cash benefit through the

initial franchise fees and subsequent trail. The license fee offers a

recurring income albeit it on much smaller levels compared to

wholly owned clubs.

The model is based on opening a total of 58 clubs, with a mix

of wholly owned (8 Clubs), joint ventured, franchised and

licensedclubs, includes adjustments to reflect the seasonality

of the trade as well as a 10% contingencyon the output.

Despite the fact the cash is normally generated ahead of profit

for an individual club, the level of expansion and investment

required in late 2017/early 2018 leads to a significant cash

requirement of between 700k and 1,000 k euros by 2017 and

2018 but this quickly returns to a cash positive figure within

the following 12 months as the establishedclubsdeliver a

return and the franchises fees generates available cash flow.

The Head Office costs are scaled up to provide a suitable

infrastructure as and when certain levels of clubs come on board.

The timing of certain clubs opening are at the discretion of

management and can therefore, together with the in-built

contingency, provide headroom within the forecasts provided.

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