Central Eastern European push for Matrix

Johnson Health Tech (JHT) has made moves to consolidate its investments in Romania with the expansion of the eastern side of the European market. JHT has opened a Romanian subsidiary in the region with potential plans for more subsidiaries to be opened in the coming months.

The new office was formally opened in Bucharest by the owner of Matrix Fitness and other top equipment brands. There are positive expectations from this business under the leadership of Vlad Lonut who has extensive experience in this field. He has spent more than a decade in the industry managing fitness clubs and promoting the sales and marketing of other equipment brands the group has announced its on-going efforts to build a sales and marketing team and to establish standard warehouse management processes. Lonut will officially report to the managing director of the Taiwanese group’s business unit in Italy which is backing the Romanian office's plans. JHT was previously operating in the Romanian market through a distributor.

It can be recalled that the Romanian fitness market could potentially benefit from lower VAT rates on sports and fitness services, ranging from 20% to 9%. This news may not be unconnected with the recent decision made by JHT in this industry. The change in VAT policy is in line with the measures taken to adjust the fiscal code which was previously submitted by two MPs to the Senate; it has however not been fully approved. JHT reported sales of about $624.4 million in 2016 which was an appreciation from the $529 million reported as revenue generated in 2015. The group is yet to provide a report which reflects the regional figures or comparison in the regular currencies.

The increase in revenue has been attributed to the acquisition of three U.S. Specialty retailers in the last two years. JHT currently has 319 stores with 211 of these stores in Asia. JHT remained consistent in its on-going efforts to open subsidiaries in the previous years. The group built its business in Canada in 2015 which started with the acquisition of Stak Fitness, a Canadian distributor. Three more subsidiaries where opened in Mexico, the Philippines and in the United Arab Emirates. Three years ago JHT had established its presence in Eastern Europe with the opening of a subsidiary in Poland.