PETALING JAYA: True Group has said that it will pay the outstanding salaries owed to 70 of its staff in Malaysia affected by the sudden closure of its fitness centres.
A spokesman for the Singapore-based True Group said that its accounts were "held back" due to the announcement of the closure of its fitness centres in Malaysia.
"That has been resolved and the salaries and commissions have been sent to all staff and will be released on June 19," he said on Tuesday.
On Saturday, True Fitness Malaysia announced that it had ceased all operations of its three gym and spa facilities located in Jaya 33, Taipan Subang and Sunway Giza as they were "no longer financially viable" due to evolving market conditions.
True Fitness Malaysia is part of the True Group, which has a number of subsidiaries operating its outlets in Malaysia.
The True Group claims about 10,000 members were affected by its closure, and the spokesman explained that former staff and members were not told in advance of its abrupt closure as its creditors had left them with "no option" to do so.
"We express our sympathies about the matter that has happened, we tried to exhaust all other options but there were no alternates available except to consolidate the business in Malaysia," he said.
He also said that True Fitness Malaysia had been incurring operating losses since the implementation of the Goods and Services Tax (GST) in May 2015.
"The losses for 2015 were RM9.15mil and we lost RM7.26 mil in 2016. Over the past year, the businesses in Singapore, Taiwan and China were assisting to subsidise the losses in Malaysia," he said.
He added that a creditor had filed an application to appoint a provisional liquidator before the company could arrange for the business to be restructured, saying that this forced the closure.
Asked about the denial issued by CHi Fitness over membership transfers, the spokesman said that there is no agreement yet but discussions are ongoing.
However, he said that the True Group would be making batch purchases from CHi Fitness.
"We will purchase 2,000 one-month membership vouchers and 1,667 personal training sessions per batch over the period of 24 months," he said, adding that more batches will be purchased if needed.
He added that True Fitness Malaysia members would be able to claim a one-month membership and a maximum of four personal training sessions each month.
"These monthly passes will be made available for the next two years," he said.