Leejam to consider all expansion options for sustainable growth, returns: CEO

Abdulelah Al-Nemr, CEO of Leejam Sports Co.

Leejam Sports Co.’s new three-year strategy will consider vertical or horizontal expansion, in addition to all other options to achieve sustainable growth and returns for shareholders, CEO Abdulelah Al-Nemr told Argaam in an interview.

The company has been expanding since the launch of its 2023 strategy and will maintain this direction through 2025, he added.

The current number of Fitness Time branches across all categories reached 205 in Saudi Arabia and the UAE by the end of Q1 2025, Al-Nemr noted.

Nearly 50 more branches were under construction and design by the end of Q1 2025. The new branches will take between 18 to 24 months to break even, the CEO further stated.

Regarding the performance of Like-for-Like (LFL) centers, they achieved a strong and stable gross profit margin for the same quarter, compared to Q1 2024.

Leejam is committed to its expansion strategy, even if it does not pay off in the short term, albeit positive outcomes are anticipated over the medium and long terms, he pointed out.

Based on market nature, demand grows with the expansion of gym supply (supply-driven demand). Market studies also showed that the number of gym-goers is likely to double by the end of 2027, supported by government-backed programs aimed at promoting sports and health awareness while also enhancing physical fitness.

He noted that Leejam remains committed to offering competitive products and subscription plans tailored to customer needs.

Regarding the Q1 2025 performance, the CEO said the company’s profit margins—despite growth in sales and subscriber base—was weighed down mainly by new branch additions, which require a gradual ramp-up period before reaching target revenues.

According to Al-Nemr, this pressure is expected to persist into Q2, with some improvement anticipated later in the year.

Leejam’s first-quarter net profit declined to SAR 71 million, compared to SAR 94 million in Q1 2024, Argaam earlier reported.