Xponential Fitness Signs Multi-Brand Master Franchise Agreement for Mexico

Rhea-AI Summary

Xponential Fitness has announced a groundbreaking Master Franchise Agreement in Mexico, marking its entry into the 14th country. The agreement allows the franchisee to develop at least 60 studios for brands like StretchLab, Rumble, and AKT over the next decade. With over 2,100 studios worldwide, Xponential aims to leverage Mexico's booming fitness market. The franchisee, Grupo ITISA, is recognized for its expertise in franchise development. This move is anticipated to enhance Xponential's international footprint.

Positive

• Signing of Master Franchise Agreement in Mexico for 60+ studios over 10 years.
• Expansion into the third largest fitness market in the Americas.
• Partnership with Grupo ITISA, a prominent local company.
• Continued growth in international markets with successful studio launches in various countries.

Negative

• Risks associated with opening new studios in an international market.
• Dependence on franchisee's ability to generate revenues and manage operations.

New Agreement Will Bring StretchLab, Rumble and AKT Studios to Mexico, the 14th country for Xponential Fitness

IRVINE, Calif.--(BUSINESS WIRE)-- Xponential Fitness, Inc. (NYSE: XPOF), the largest global franchisor of boutique fitness brands, announced today that it has signed a Master Franchise Agreement in Mexico for three of its brands: StretchLab, Rumble and AKT. The agreement provides the Master Franchisee with the opportunity to license at least 60 studios across the three brands to potential franchisees in Mexico over the next 10 years. As of December 31, 2021, Xponential had over 2,100 open studios worldwide, operating in 10 countries and across four continents.

The Mexico Master Franchisee is a division of Grupo ITISA, one of Mexico’s largest companies in the infrastructure sector. Grupo ITISA is also involved in the hospitality sector as franchise development partners for Danish furniture store Bo Concept and American family entertainment brand Chuck E. Cheese.

“Mexico is the third largest country in the Americas in terms of number of fitness facilities and now is an outstanding time for Xponential Fitness to enter that market,” said John Kersh, Chief International Development Officer for Xponential Fitness. “We are excited to partner with Grupo ITISA and are confident that Danny Arditti and his exceptional team are the right people to develop the Xponential brands across the country.”

Danny Arditti, Brand Director of the newly-developed fitness and wellness business for Grupo ITISA, is motivated to expand Xponential Fitness’ reach into Mexico. Arditti is responsible for leading, designing and implementing the business strategy for the growth of both existing and new successful concepts for the company.

“We feel privileged to bring Xponential’s world-class boutique fitness offerings to Mexico and look forward to diversifying our successful platform of high-end brands already present in Mexico,” said Arditti.

Xponential Fitness continues to make significant progress in its international expansion, with successful studio launches in Australia, Dominican Republic, Japan, New Zealand, Saudi Arabia, Singapore, South Korea and Spain, along with future studios planned in Austria, Germany and the UK. This growth was accelerated by Xponential’s recent acquisition of its tenth boutique fitness brand BFT, an Australia-based functional training and strength-based fitness franchisor with over 150 studios currently operating in Australia, New Zealand, Singapore and the United States as of December 31, 2021.

These international deals will keep the momentum going for Xponential Fitness. Further enhancing this accessibility to multiple modalities, in April 2022, Xponential Fitness launched its new digital platform Xponential+ (“XPLUS”), providing live and on-demand access to the same sought-after workouts offered in thousands of studio locations around the globe. Xponential Fitness also just recently announced its collaboration with lifestyle-inspired athletic apparel company lululemon to create original fitness programming for the MIRROR, the retailer’s smart home gym offering that boasts a robust workout library of over 10,000 on-demand classes.

For more information about Xponential Fitness and to learn more about its various franchise opportunities, visit www.xponential.com.

ABOUT XPONENTIAL FITNESS:

Xponential Fitness, Inc. (NYSE: XPOF) is the largest global franchisor of boutique fitness brands. Through its mission to make boutique fitness accessible to everyone, the Company operates a diversified platform of ten brands spanning across verticals including Pilates, indoor cycling, barre, stretching, rowing, dancing, boxing, running, functional training and yoga. In partnership with its franchisees, Xponential Fitness offers energetic, accessible, and personalized workout experiences led by highly qualified instructors in studio locations across 48 U.S. states and Canada, and through master franchise or international expansion agreements in 12 additional countries. Xponential Fitness' portfolio of brands includes Club Pilates, the largest Pilates brand in the United States; CycleBar, the largest indoor cycling brand in the United States; StretchLab, a concept offering one-on-one and group stretching services; Row House, the largest franchised indoor rowing brand in the United States; AKT, a dance-based cardio workout combining toning, interval and circuit training; YogaSix, the largest franchised yoga brand in the United States; Pure Barre, a total body workout that uses the ballet barre to perform small isometric movements, and the largest Barre brand in the United States; STRIDE, a treadmill-based cardio and strength training concept; Rumble, a boxing-inspired full-body workout; and BFT, a functional training and strength-based program. For more information, please visit the Company’s website at xponential.com.

Forward-Looking Statements

This press release contains forward-looking statements that are based on current expectations, estimates, forecasts and projections based on management's judgment, beliefs, current trends, and anticipated performance, including statements regarding the timing of opening and number of additional studios in Mexico. Forward-looking statements involve risks and uncertainties that may cause actual results to differ materially from those contained in the forward-looking statements. These factors include, but are not limited to, the impact of the COVID-19 pandemic on our business and franchisees; our relationships with master franchisees and franchisees; difficulties and challenges in opening studios by franchisees; the ability of franchisees to generate sufficient revenues; risks relating to expansion into international markets; loss of reputation and brand awareness; material weakness in our internal control over financial reporting; and other risks as described in our SEC filings, including our Annual Report on Form 10-K for the full year ended December 31, 2021 filed by Xponential Fitness with the SEC and other periodic reports filed with the SEC. Other unknown or unpredictable factors or underlying assumptions subsequently proving to be incorrect could cause actual results to differ materially from those in the forward-looking statements. Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, level of activity, performance, or achievements. You should not place undue reliance on these forward-looking statements. All information provided in this press release is as of today's date, unless otherwise stated, and Xponential Fitness undertakes no duty to update such information, except as required under applicable law.

View source version on businesswire.com: https://www.businesswire.com/news/home/20220510005374/en/

Media Contact: David Robertson, Fishman Public Relations, drobertson@fishmanpr.com or 847-945-1300

Source: Xponential Fitness, Inc.

FAQ

What is Xponential Fitness's recent expansion in Mexico?

Xponential Fitness has signed a Master Franchise Agreement to open 60+ studios for its brands in Mexico over the next 10 years.

Which brands will be launched in Mexico by Xponential Fitness?

The brands include StretchLab, Rumble, and AKT.

Who is the Master Franchisee for Xponential Fitness in Mexico?

The Master Franchisee is Grupo ITISA, a large company in the infrastructure sector.

How many studios does Xponential Fitness currently have worldwide?

As of December 31, 2021, Xponential operates over 2,100 studios globally.

What market is Xponential Fitness entering with this agreement?

Xponential Fitness is entering the fitness market in Mexico, the third largest country in the Americas in terms of fitness facilities.