Hollywood Bowl Group Plc · LSE:BOWL
Hollywood Bowl — H1 2017 Earnings Presentation
39 slides from Hollywood Bowl's earnings presentation, May 24, 2017
Slide 1: Interim Results Presentation
INTERIM RESULTS PRESENTATION Half Year Ended 31 March 2017 Stephen Burns – Chief Executive Officer Laurence Keen – Chief Financial Officer 1 CONFIDENTIAL – May 2017
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Slide 3: 2017 H1 Highlights
2017 H1 Highlights Group Revenue LFL Sales Adjusted Profit After New Sites Growth Growth EBITDA Tax For FY 17 +7.9% +1.2%* +8.6% +101.7% 4 £59.3m £18.2m £10.0m (H1 16: £55.0m) (H1 16: +10.4%) (H1 16: £16.8m) (H1 16: £4.9m) * Easter switch worth c. 2.0%pts Operational highlights Successful execution
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Slide 5: Financial Highlights
Financial Highlights Revenue £m Group Adjusted EBITDA £m Total Revenue +7.9% Adjusted EBITDA +8.6% 106.6 29.4 86.0 78.7 70.2 20.6 59.3 18.2 55.0 16.8 14.6 11.0 FY13 FY14 FY15 FY16 H1 16 H1 17 FY13 FY14 FY15 FY16 H1 16 H1 17 Gross Profit % Group Adjusted EBITDA Margin % +1.2%pt FYE of Drink and Amuse
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Slide 7: Adjusted EBITDA Bridge
EBITDA increased 8.6% Part year effect of Bowlplex acquisition Effect of new drink, - £3.4m Revenue food and and £1.0m EBITDA amusement terms in LFL Revenue LFL estate growth of 1.2% 1.0 (0.6) (0.3) 0.2 18.2 0.7 0.6 16.8 PLC costs Same Centre Costs Same Centre GP% Movement Adjusted EBITDA H1FY17 Adj
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Slide 9: Income Statement (i)
Income Statement (i) (£m) 6 months to 6 months to Movement Revenue of £59.3m, growth 31 March 2017 31 March 2016 of 7.9% LFL up 1.2%, with Easter Revenue 59.3 55.0 +7.9% switch into H2 worth 2.0%pts Gross profit 50.3 46.0 +9.3% Gross Profit% increased due Gross profit % 84.9% 83.7% +1.2pts to full y
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Slide 11: Income Statement (ii)
Income Statement (ii) (£m) 6 months to 6 months to Movement 31 March 2017 31 March 2016 Adjusted EBITDA 18.2 16.8 +8.6% EBITDA margin increased EBITDA margin 30.8% 30.6% +0.2%pts due to revenue growth and Depreciation (4.9) (4.7) strong cost controls Amortisation (0.3) (0.2) Exceptional items (0.2)
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Slide 13: Adjusted Operating Cash Flow (£m)
Strong cash generation 80.0% 102.0% Adjusted Operating Cash Flow (£m) Continued investment in maintenance and expansionary projects 3 refurbishments completed in H1 along with £3m gross spend on new centres Net cash flow for H1 of £7.3m H1 FY17 OCF Conversion H1 FY16 Net capital spend forecasted at
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Slide 15: Group Balance Sheet
Group Balance Sheet (£m) 6 months to 6 months to 31 March 2017 31 March 2016 Net cash flow of £7.3m in H1 PPE 38.6 37.0 Intangibles 79.0 79.3 Net debt of £13.5m (0.43 times LTM EBITDA) Stock 1.2 1.2 Trade and other Board will review net debt 6.2 11.8 Receivables position at year end to enhance share
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Slide 17: Refurbishment Programme – Hollywood Bowl
Refurbishment Programme – Hollywood Bowl Return on Investment Average ROI of 46% during H1 70% 6 centres invested in or annualised in 60% 50% 46% H1 Achieved 40% average ROI* Games volumes up 3.8% vs non 30% invested estate 20% 48% of existing estate refurbished 10% 5 centres to be invested in H2 pl
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Slide 19: Refurbishment Programme – Bowlplex
Refurbishment Programme – Bowlplex Return on Investment Rebranded 5 Bowlplex sites at end of H1 140% Average ROI** of 76% during H1 120% 76% 100% Achieved Games volumes up 22.5% vs non 80% average ROI* invested Bowlplex centres 60% 40% Average revenue for 3 centres rebranded in FY16 grown to £2.2m (
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Slide 21: Development of New Centres
Development of New Centres Southampton Watermark centre opened 16 December 2016 18,000sq ft. 16 lanes Cashless amusements offer Pins on strings - positive trial feedback Delivered under capital expenditure budget Trading very well since opening Gross capex £2.4m Landlord contribution (£1.1m) Net cap
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Slide 23: Development of New Centres
Development of New Centres Derby intu centre opened 8 April 2017 22,000sq ft 18 lanes Trials of pins on strings and cashless amusements continue New VIP lane concept Trading in line with management expectations Gross capex £2.3m Landlord contribution Nil Net capex £2.3m * Rent reduction of £100k eve
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Slide 25: Strong Pipeline
Strong Pipeline The O2 London Hollywood Bowl – FY17 Management Agreement to run existing bowl Enhances London presence 30,000 sq ft. 12 lanes including 3 VIP Refurbishment capital expenditure to open Largest ticketing venue in the world, new retail outlet area opening in 2018 Dagenham Hollywood Bowl
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Slide 27: Strong New Centre Pipeline
Strong New Centre Pipeline intu Watford Hollywood Bowl – FY 18/19 intu Lakeside Hollywood Bowl – FY19 Key anchor in the new intu extension Largest bowling centre to open in UK for alongside Cineworld and Debenhams over 10 years Intu extension is 400,000 sq ft, £180m spend Major anchor of new leisure
Slide 28: New Initiatives and Innovation
New Initiatives and Innovation
Slide 29: New Initiatives and Innovation in H1
New Initiatives and Innovation in H1 Back of house excellence 900 853 800 Games Per Stop (GPS) 700 GPS up 15% to 356 in H1 600 Pins on strings trial running in Southampton and 500 Derby - GPS at 853 356 400 Targeted 310 In line for payback in under 2 years 300 marketing Installation planned for exis
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Slide 31: New Initiatives and Innovation in H1
New Initiatives and Innovation in H1 Improving our customer offer New version of our proprietary scoring introduced with improved game experience and highly personalised post bowling Targeted communications marketing Refined Hollywood Diner menu introduced following customer and operational review D
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Slide 33: Summary and Outlook
Summary and Outlook Another strong set of results for the business Solid financial performance of the business across all key metrics Board to consider appropriate use of cash generation at year end Successful execution of growth strategy Re-brand of Bowlplex centres on track Refurbishment programme
Slide 34: Appendix
Appendix
Slide 35: Management
Management Experienced and motivated management team with track record of success Steve Burns Laurence Keen Chief Executive Officer Chief Financial Officer Appointed MD in 2012, having joined the company Joined in 2014 as Finance Director and Company in 2011 and appointed CEO in 2014 Secretary Previ
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Slide 37: Business overview
Business overview Multiple revenue streams(a) National scale – 56 centres Key stats(b) Other Hollywood Bowl has a (c.1%) high net promoter score of 56% Amusement Centre Statistics machines Average lease length 14.4 years (c.23%) % of sites co-located with cinemas c.75% Bowling Number of loss making
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Slide 39: Board of Directors and Senior Management
Board of Directors and Senior Management Board of Directors Peter Boddy – Non-Executive Chairman Nick Backhouse – Senior Independent Non-Executive Director • Chairman of Xercise4Less and the Harley Medical Group • Joined the Group in 2016 • CEO or MD of a number of successful private equity backed c