Leisure clubs in pounds 20m roll-out

Whitbread, the brewing and leisure giant, is launching five new health and fitness centres at a cost of pounds 20m despite the possible departure of the chain's chairman and namesake, former tennis player and Davis Cup winner David Lloyd, writes Paul Rodgers.

City observers fear the former player's declared intent to resign from David Lloyd Leisure if he is made chief executive of the Lawn Tennis Association in September would hurt the company's growth.

Mr Lloyd cited the need for more capital to fund expansion when David Lloyd Leisure was sold to Whitbread for pounds 200m last year. Apart from the appointment of Steve Philpott as managing director, the subsidiary's board has remained unchanged. Whitbread plans include the opening of Castle Farm in Newcastle next month, followed by clubs in Kent, Hertfordshire,Cheshire and Leeds, bringing its total to 22.

Mr Philpott said the rapid growth will continue in coming years to meet a booming demand. A study by the Henley Centre think-tank recently predicted that the pounds 1bn sports services, health, fitness and leisure club sector will grow by 60 per cent over the next five years.

Although the UK market is already well supplied with small gyms and swimming pools, Whitbread has few competitors in the market for large integrated centres, which draw their clients from catchment areas that stretch for 20 minutes' drive time in any direction.