SMFT3

Smart Fit Participações S.A., traded on B3 under the ticker SMFT3, is a Brazilian company that operates in the gym and fitness services segment, with a consolidated presence throughout Latin America. Founded in 1996 in São Paulo, with the opening of the first Bio Ritmo unit in the premium/high-end segment, the company has developed over nearly three decades a scalable business model based on multiple brands and channels. In 2009, it introduced in Brazil the concept of high value / low price gyms through the Smart Fit brand, which would become the group’s main growth engine in the region. The company’s growth trajectory includes successive capital-raising cycles with international investment funds, culminating in 2021 with the initial public offering of shares on B3, which marked its transition to a publicly held company with broad access to the capital markets.

Smart Fit’s business model is based on operating and franchising gyms focused on strength training, cardiovascular training and complementary activities, with strong process standardization, intensive use of technology and focus on user experience. The Smart Fit brand operates in the high value / low price segment, offering modern facilities, equipment from global manufacturers and historically affordable monthly fees, while the Bio Ritmo brand is positioned in the premium segment, with high-end design, differentiated training programs and more personalized services. At the end of 2024, the company had 1,743 owned and franchised gyms in 15 Latin American countries, serving 4.8 million gym clients under the Smart Fit, Bio Ritmo and Nation brands, in addition to 135 specialized Studio units and an ecosystem of digital and corporate fitness solutions.

The company’s operations are organized into different product and service fronts. At the core of the business are the Smart Fit gyms, which totaled 1,711 units at the end of 2024, distributed between owned and franchised operations in Brazil, Mexico and other Latin American countries. This portfolio is complemented by Bio Ritmo gyms, focused on the premium segment, the O2 brand and other smaller banners, as well as specialized Studios in modalities such as indoor running (Race Bootcamp), strength-focused training (Tonus Gym), yoga (Vidya Body & Mind), boxing and functional training (Jab House), pilates (One Pilates) and cycling plus strength and endurance training (Velocity and Kore). The company also operates in the digital market with the Queima Diária workout streaming platform, which offers fitness, health and wellness programs in a multi-device format, and with complementary services such as Smart Fit Nutri, focused on nutritional monitoring via app and teleconsultations, and Smart Fit Coach, an individualized online training consulting service.

Geographically, Smart Fit structures its results analysis into three segments: Brazil, Mexico and Other Latin America, reflecting the relative weight of each market in revenue and gym base. As of December 31, 2024, the group had 823 gyms in Brazil, 395 in Mexico and 525 distributed across countries such as Colombia, Chile, Peru, Panama, Costa Rica, Argentina, Paraguay, El Salvador, Ecuador, Guatemala, Dominican Republic, Honduras and Uruguay. International expansion was carried out through a combination of owned units, franchises and joint ventures with local operators, followed in some cases by the acquisition of partners’ stakes and internalization of operations, as occurred in Chile, Mexico, Colombia, Peru, Panama and Costa Rica. Owned operations under the Smart Fit brand in Mexico and other Latin American countries accounted, at the end of 2024, for close to 60% of the total number of gyms and clients in these regions, underscoring the importance of international operations in the consolidated base.

In Brazil, Smart Fit combines organic expansion of owned gyms with a relevant franchise model, especially in smaller cities and regions outside major urban centers. As of December 31, 2024, the company had 569 owned Smart Fit gyms in the country, with 1.6 million clients, and 224 franchised units, with around 579 thousand clients. The Bio Ritmo brand had reached 30 units, including its first operation outside Brazil, in Panama. The Studios, present in 9 of the 10 largest Brazilian capitals and in one unit in Portugal, reinforce the portfolio focused on group training in specialized environments. Operations management is based on strong standardization, the use of proprietary systems developed in-house and constant monitoring of performance indicators, including satisfaction metrics such as Net Promoter Score (NPS), which the company reports at levels considered high for the high value / low price gym segment.

In addition to its own gyms and platforms, Smart Fit has expanded its reach into the B2B2C segment through TotalPass, a corporate benefits platform that connects companies, employees and a wide network of partner gyms and Studios. Positioned as an aggregator of the fitness market in Brazil and Mexico, TotalPass served, at the end of 2024, as a relevant sales channel, with more than 21 thousand partner units registered in Brazil, present in over 1,400 cities, and around 6 thousand in Mexico, including the group’s gyms. TotalPass operates as a corporate wellness solution, allowing employees of client companies to access the accredited gym network, which increases Smart Fit’s capillarity without the need to directly own all the physical assets. The platform’s user base is distributed between subscriptions via companies and individual users in partnership with the gym network.

From a regulatory standpoint, Smart Fit operates in a service sector that does not depend on concessions or specific authorization from federal regulatory agencies for its core activity, but is subject to a set of professional, sanitary and consumer protection rules. Gyms and physical education professionals must be registered with the Federal and Regional Councils of Physical Education, maintain a qualified technical supervisor and comply with limits on students per professional in some jurisdictions. Several states and municipalities require sanitary licensing, operating permits and fire safety certificates to operate gyms, as in São Paulo, Rio de Janeiro, Natal and Rio Grande do Sul, among others. As a service provider, the company is subject to the Consumer Defense Code, which implies responsibility for safety, quality and adequate information regarding the services offered.

In terms of environmental, social and governance practices, the company emphasizes compliance with applicable labor, social security and sanitary regulations, as well as the protection of its brands and intangible assets. The company holds a broad portfolio of trademarks registered or in the process of registration with the Brazilian Patent and Trademark Office (Instituto Nacional da Propriedade Industrial), including “Smart Fit”, “Queima Diária”, “Smart Fit Nutri”, “Smart Fit Supps”, “Smart Fit Energy”, “Bio Ritmo”, “Race Bootcamp”, “Vidya”, “Jab House”, “Tonus Gym”, “Velocity”, “Studio Velocity” and “TotalPass”, among others, reflecting its strategy of consolidating an ecosystem of brands in the fitness segment. The standardization of training “products”, the use of design thinking methodology for developing new experiences and the continuous training of professionals through Universidade Smart Fit are elements that make up the group’s operational governance. Revenue diversification is another relevant aspect: no individual client accounted for more than 10% of net operating revenue in 2024, a typical characteristic of service retail businesses with a large base of recurring users.

Smart Fit’s common shares, under the code SMFT3, are an economic reflection of this set of operations, which combines owned and franchised gyms, digital platforms and corporate benefits solutions in multiple Latin American countries. Revenue generation is mostly based on gym membership fees, corporate contracts linked to TotalPass and subscriptions to digital services, with operating performance measured by indicators such as number of gyms, client base, net operating revenue and gross margin by region. The presence in several Latin American markets, the diversification of brands and the intensive use of technology and data in operations form the basis of the company’s business model, which positions itself as a large-scale fitness and wellness service provider, with shares listed and traded on the Brazilian stock market.