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Technogym bets on home fitness boom as virus empties gyms

EconomyOct 23, 2020 01:35PM ET
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By Elisa Anzolin

MILAN (Reuters) - Italian fitness-equipment maker Technogym (MI:TGYM) is working to supply more of its exercise machines and virtual trainers to peoples' homes to offset a drop in sales to gyms and studios due to the pandemic.

Restrictions to contain the new coronavirus, or even just fears of contagion, have prompted many people to give up training at their local gym. Italy has not ruled out closing gyms and swimming pools again to fight a COVID-19 resurgence.

"We are seeing a strong acceleration in the home fitness segment," Technogym founder and Chief Executive Nerio Alessandri told Reuters in an interview.

Technogym has been the official supplier of the last seven Olympic games and its client book includes several top soccer clubs. Alessandri said the company had been selling equipment to professional athletes stuck at home.

It also received an order from a big company that bought a "Technogym package" for its staff, offering employees working from home training programmes and equipment.

"We think that the Home & Consumer segment could come to represent around 50% of our total revenues in four years from now. And profit margins match those of the professional segment," added Alessandri, 59.

Companies such as exercise bike business Peloton (O:PTON) have successfully tapped into the home workout market as people try to stay fit during lockdowns.

Technogym, which supplies equipment to gyms, hotels and spas in around 100 countries, can offer home-friendly products. An "entry level" treadmill costs 3,250 euros ($3,850) and an exercise bike 2,950 euros.

In September, Technogym reported that first-half revenue fell to 222 million euros from 295 million a year earlier. By contrast, the group recorded a jump in sales of its home fitness equipment.

Sales of exercise machines and online training programmes directly to customers soared by 50% in the first half. They now account for 30% of group revenues, twice the level of 2019.

Alessandri said Technogym would invest to support growth at its home fitness division, using budget savings linked to the cancellations of trade fairs and business trips due to COVID-19.

He said the pandemic had impressed upon people the importance of keeping fit, and he pointed to a boom in medical fitness centres, which combine healthcare and gym facilities.

"We see new markets opening up," he said. "People are increasingly aware that good health is the true luxury."

Technogym bets on home fitness boom as virus empties gyms
 

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