Viva Leisure beats guidance on all five metrics and declares maiden dividend
In its FY2026 results presentation, Viva Leisure (ASX: VVA) reported full-year revenue of $237.1m, up 12.2%, marking its seventh consecutive year of year-on-year growth. Underlying net profit after tax (NPAT) reached $18.9m, a rise of 46.4%, while the Board declared a maiden fully franked dividend of 3.0 cents per share.
The company ended the period with 534 operating locations and 694,243 members, and exceeded guidance on all five reported metrics. Management framed FY2026 as a deliberate “network optimisation” year, with the growth lever switched off to demonstrate the model’s underlying economics. Reacceleration has now been flagged for the periods ahead.
Guidance vs delivered
Viva Leisure exceeded every metric it set, including the NPAT guidance it upgraded in May 2026 and subsequently beat.
The May 2026 guidance upgrade lifted Statutory NPAT expectations to above $12m and Underlying NPAT to above $17m, both of which the FY2026 result subsequently cleared, with the final underlying figure landing at $18.9m.
| Metric | FY2025 Actual | Revised Guidance | FY2026 Actual | Growth vs FY2025 |
|---|---|---|---|---|
| Revenue | $211.3m | >$237m | $237.1m | +12.2% |
| Adjusted EBITDA | $99.1m | >$111m | $112.3m | +13.3% |
| Underlying EBITDA | $45.9m | >$53m | $53.7m | +17.0% |
| Statutory NPAT | $5.2m | >$12m | $12.8m | +144.5% |
| Underlying NPAT | $12.9m | >$17m | $18.9m | +46.4% |
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Growth with operating leverage, margins expand as costs grow slower than revenue
The core of the FY2026 result rests on operating leverage. Revenue grew 12.2% while operating costs rose only 10.2%, delivering 50bps of Adjusted EBITDA margin expansion to 47.4%. This marks the second consecutive year in which costs grew slower than revenue.
Management noted that 51 cents of every incremental revenue dollar converted into EBITDA. Adjusted EBITDA reached $112.3m, up 13.3%, while statutory NPAT lifted 144.5% to $12.8m.
Statutory earnings per share (EPS) came in at 13.1 cents, with underlying EPS of 19.43 cents, a rise of 54.2%. The significance for investors is that the same mechanics apply to every new member and site, with growth arriving against a cost base already built to carry it.
Organic growth via network optimisation
The standout of the optimisation year was organic member growth. With only 3 net new corporate locations, Viva added 17,117 corporate members, lifting average members per club to 1,351, a company record. Portfolio utilisation moved above 80%, also a record.
Average revenue per member sits at approximately $750, representing roughly $10m per annum across 204 locations, flowing through at a high marginal rate.
Self-funded growth and a strengthened balance sheet
FY2026 saw the entire growth program funded from operating cash flow while leverage still fell. Adjusted free cash flow of $35.1m, up 7.7%, covered $31.3m of growth reinvestment. Net leverage reduced from 2.04x to 1.77x, well within the covenant of 2.50x.
Maintenance capex of $6.1m remained below the company’s target of 3% of revenue. The FY2026 capital allocation was distributed as follows:
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Growth capex: $21.4m
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Technology investment: $5.5m
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Acquisitions: $4.4m
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Debt reduction: $1.7m
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On-market buy-back: $1.8m
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Maiden dividend: $2.9m
The significance for investors is that shareholder returns were delivered alongside reinvestment, not instead of it.
Harry Konstantinou, CEO & Managing Director
“FY2026 was the year we said we would slow the rollout and prove the model. We did both. Revenue grew 12.2 per cent while costs grew 10.2 per cent, EBITDA margin expanded by 50 basis points, and we exceeded guidance on every metric — including the NPAT guidance we upgraded in May. Underlying NPAT of $18.9 million is up 46 per cent, adjusted free cash flow reached $35.1 million, and leverage fell to 1.77 times without diverting a dollar from growth.
On the back of that, the Board has declared Viva’s first ever dividend.”
Understanding Viva’s four-pillar model
Viva Leisure generates revenue across four distinct streams. Understanding the mix, and how it is shifting, helps explain where operating leverage compounds.
| Pillar | Revenue FY2026 | Growth | What it is |
|---|---|---|---|
| Health Clubs | $208.2m | +11.0% | Club Lime, Plus Fitness, World Gym, boutiques |
| Franchise Network | $9.0m | +13.5% | Franchisor and investment income |
| Payments & Tech | $7.1m | +39.8% | Viva Pay and Viva Labs |
| Supps & Other | $12.8m | +18.5% | PT licensing, Supp Society, vending |
The tilt for investors lies in momentum. The two fastest-growing streams, Payments & Tech at +39.8% and Supps & Other at +18.5%, are capital-light, requiring no new lease or fit-out to grow. That is where operating leverage compounds. Payments & Tech is shown as external revenue after inter-segment eliminations; on a gross basis, the segment earned $20.2m, or 8.5% of group revenue.
Meridium Global, unlocking value in a standalone payments and technology business
Viva Leisure outlined a strategic review of its payments and technology assets. According to the presentation, these assets “will transfer into Meridium Global,” which will “own and operate them as a standalone business,” and a “strategic review is underway to determine the optimal path to realising their value.”
On a standalone basis, Meridium EBITDA grew from $3.7m in FY2025 to $13.4m in FY2026, pre inter-segment eliminations. Total Transaction Volume (TTV) now exceeds $400m.
Management identified two constraints that separation is intended to remove. The first is the peer group, as a standalone business would sit alongside payments and technology comparables rather than fitness peers. The second is customer access, with separation intended to open a larger addressable market beyond Viva’s own network.
Reaccelerating toward one million members by FY2029
With the optimisation year complete, management outlined a strategy to switch the growth lever back on. The company is targeting 1,000,000 members by FY2029, and is currently adding 6,000+ members a month.
Net new corporate locations are set to rise from 3 in FY2026 to 20+ from FY2027 onward, with 170 locations already sold and in the pipeline across corporate and franchise networks. The current trading update noted network membership has now passed 700,000, with corporate membership above 278,000.
Viva 360, turning retention into a predictive discipline
Viva 360 is the company’s member-intelligence platform, drawing on more than 20 years of owned data to predict member churn before it occurs. Key capabilities the presentation detailed include:
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89.1% churn model accuracy, built on 72 engineered features
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7 to 30 days of warning ahead of membership suspensions
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1:1 lookalike targeting on owned data to sharpen acquisition
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Approximately 46,000 cross-sell opportunities identified
FY2026 delivered the prediction capability. The next step, targeted for FY2027, is automated intervention deployed against predicted churn.
Refurbishment upside
The presentation also referenced a refurbishment and re-brand program to Zoo Fit, which is expected to deliver approximately 30 to 40% average upside per location within three months of completion. Twenty locations are planned, with no new lease required. The program is funded from existing cash flows against 1.77x leverage.
The investment picture
FY2026 positioned Viva Leisure as a business demonstrating operating leverage, self-funding its growth, and returning its first dividend to shareholders. With a potential value-unlock under review in Meridium Global and a stated runway toward one million members by FY2029, the year set out both a proven model and a reacceleration plan.
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