Youth Group could close gyms in bid to save money

Battered by financial difficulties, the Youth Camp Health Group (佳姿健康集團), one of the nation's biggest fitness center chains, could suspend business at several branches to reduce operation costs.

Currently running 25 outlets nationwide, including the Taipei 101 Oxy Gym, Youth Camp reportedly plans to shut down its Zhongxiao II outlet in Taipei for three to six months, while the headquarters situated in the same building will not be relocated.

Business at the firms Yonghe, Sanchung and Guting gyms will also be "adjusted," according to a Chinese-language newspaper report.

Cautious

When contacted by the Taipei Times yesterday, the company maintained a cautious approach, refusing to give concrete answers about the scope of the company's financial problems or how it will facilitate cash flow.

"We're still adjusting [operation modes] and cannot confirm any speculation," said Lin Chia-jung (林佳蓉), assistant manager of marketing at Youth Camp, which opened its first gym in 1977.

Youth Camp's financial crisis erupted in late February when checks worth tens of millions of NT dollars bounced and employee's salaries were delayed.

According to a former employee speaking on condition of anonymity, the company started to suspend salary payments around Lunar New Year in early February.

"The staff has only collected their February paychecks. They have been told they will receive one-third or half their past-due salaries as the company seeks capital. Many people have left the company for this reason," she said in a telephone interview.

Pure Tsai (蔡純真), president of the Youth Camp, entered the media spotlight when her premium health club in the Taipei 101 Mall was inaugurated in a celebrity-studded opening in July last year.

The NT$350 million Taipei 101 Oxy Gym originally aimed at attaining only 3,000 VIP members, with a premium entrance fee of NT$1.01 million per person.

Delayed leasing

But the mall's delayed leasing process has widened Youth Camp's capital gap, forcing the company to downgrade the Taipei 101 Oxy Gym, which requires a monthly rent of NT$6 million.

"It would be a piece of cake to lure 3,000 members from among the estimated 12,000 employees working in the financial building," Tsai said in August last year.

To lessen the capital pressure, Youth Camp is allowing other members to work out and enjoy the spa facilities in this flagship store by paying a fee of NT$10,000.