Hollywood Bowl Group Plc · LSE:BOWL
Hollywood Bowl — H1 2021 Earnings Presentation
26 slides from Hollywood Bowl's earnings presentation, May 17, 2021
Slide 1: Half Year Ended 31 March 2021
HALF YEAR ENDED 31 MARCH 2021 holl d bowl KKK KKK Ka KKK S orOup PIE Keke Ke Kaka KKK
Slide 2: Agenda
AGENDA • H1 FY2021 summary • Financial performance • Operational progress • Ready to reopen • Well positioned for the future
Slide 3: H1 2021 Summary
H1 2021 SUMMARY Strong financial and operational performance when centres were able to open in the period • October half term 86% of prior year revenues with only 67% of lanes available • No structural change to customer engagement, spend per game and dwell time all in line with pre-COVID levels • P
Slide 4: Financial Performance
FINANCIAL PERFORMANCE Hollywood Bowl Group plc 4
Slide 5: Income Statement on Pre IFRS 16 Basis
INCOME STATEMENT ON PRE IFRS 16 BASIS • Total revenue down 82.6% with (£m) H1 FY H1 FY Movement only 6.5 weeks of centres trading 2021 2020 Revenue 12.0 69.2 (82.6%) • Gross profit loss of £48.5m due to lockdown Gross profit 10.8 59.3 (81.7%) • Grants worth £1.6m and furlough credit of £6.4m (with a
Slide 6: Income Statement
INCOME STATEMENT (£m) H1 FY H1 FY Movement 2021 2020 • IFRS 16 now comparable with Group Adjusted EBITDA (7.5) 21.6 prior year Add back Rent FY2020 7.6 7.7 Group Adjusted EBITDA 0.2 29.3 • IFRS 16 PBT impact of £1.1m due to front end loaded leases Depreciation and amortisation (10.2) (9.9) +1.0% • N
Slide 7: Protecting Cash Prior to Reopening
PROTECTING CASH PRIOR TO REOPENING • Employees – 99% of team members furloughed since • Refurbishments and capital investment projects – Jan 2021 Stevenage and Basildon completed / 2 POS installs • Trade creditors reduced by £3.6m compared to year • Operational cash burn of £7.1m during H1 end • Cap
Slide 8: Proactive Liquidity Management
PROACTIVE LIQUIDITY MANAGEMENT Bank Covenants • 31 March 2020 Balance sheet strength, cash at bank £15.6m, gross debt at £30.3m Cash Date Leverage Liquidity flow • April 2020 5% equity placing completed £10m RCF under CLBILS agreed along with amended leverage covenants for following 12 months. March
Slide 9: Clarity on Property Concessions and Deferrals
CLARITY ON PROPERTY CONCESSIONS AND DEFERRALS H2 FY H1 FY 2020 2021 Total Write offs £4.0m £2.1m £6.1m Deferred with agreement £1.0m £1.3m £2.3m Paid £2.1m £3.6m £5.7m Deferred no agreement £1.1m £1.2m £2.3m TOTAL £8.2m £8.2m £16.4m Hollywood Bowl Group plc 9
Slide 10: Cash Management - No Impact on Investment
CASH MANAGEMENT-NO IMPACT ON INVESTMENT Cash benefits in H1FY2021 Cash Costs Cash received waived deferred Government support £7.2m £3.2m - Suppliers - - £1.2m Landlords (rent only) - £2.1m £2.5m TOTAL £7.2m £5.3m £3.7m Cash commitment to H2 H1 FY2023 or repay deferrals FY2021 FY2022 later Governmen
Slide 11: Balance Sheet
BALANCE SHEET (£m) H2 FY H1 FY 2020 2021 Movement Intangible Assets 78.0 78.4 (0.4) • Right-of-use asset of £130.3m Property, plant and equipment 46.4 48.8 (2.4) netted off with lease liabilities of £172.9m Right-of-use assets 130.3 132.8 (2.5) Inventories 1.3 1.5 (0.2) • Reduction in rent pre-payme
Slide 12: Well-Positioned for Growth
WELL-POSITIONED FOR GROWTH Hollywood Bowl Group plc 12
Slide 13: Long Term Strategy Remains Unchanged with Enhanced Opportunities to Accelerate Growth
LONG TERM STRATEGY REMAINS UNCHANGED WITH ENHANCED OPPORTUNITES TO ACCELERATE GROWTH ORGANIC GROWTH INVESTMENT LED GROWTH Enhancing the customer experience Maintaining a high-quality, profitable estate • Increasing dwell time through customer • Rolling refurbishment programme which focused culture a
Slide 14: Positive Trading for Bowling Centres When Open in H1
POSITIVE TRADING FOR BOWLING CENTRES WHEN OPEN IN H1 • By October half term, 28 centres benefitted from lane • Closures limited trading in H1 to 24.6% of available seating dividers, increasing utilisation to 67% weeks • October SPG was impacted by overall capacity and • December easing of restrictio
Slide 15: Puttstars Delivering in Line with Expectations
PUTTSTARS DELIVERING IN LINE WITH EXPECTATIONS • Strong trade levels • Positive customer when open feedback scores • Golf spend per game in • Value price position in line with bowling market • Opportunity to drive • Strong pipeline – 8 new ancillary spend locations in negotiation • ROI of 20% in Yea
Slide 16: Resumption of Capital Investment Programme
RESUMPTION OF CAPITAL INVESTMENT PROGRAMME • Refurbishment of Stevenage and Basildon completed prior to reopening in May 2021 • A further 3 refurbishments (Glasgow Quay, Cheltenham and Glasgow Coatbridge) planned during 2021 • Liverpool full refurbishment of existing centre and release of excess spa
Slide 17: Technical Excellence and Innovation
TECHNICAL EXCELLENCE AND INNOVATION Pins on strings • Continued roll out – a further 6 centres this year • 24 centres complete by end of FY2021 • Average ROI of POS is 30% on capital invested New scoring system • Continued roll out - 60 out of 61 centres completed to date • Integrated into CRM platf
Slide 18: New High-Quality Opportunities
NEW HIGH-QUALITY OPPORTUNITIES • The change in the retail landscape during the pandemic has presented increased opportunities for bowling and mini-golf in prime locations • Landlords want to increase the experiential leisure offering in their schemes post COVID • Continued attraction of the Group as
Slide 19: Strong New Centre Pipeline to 2024
STRONG NEW CENTRE PIPELINE TO 2024 1. BELFAST – FY2022 2. BIRMINGHAM – FY2022 (NEW) 7. HARROW– FY2022 (NEW) • First Hollywood • Part of redevelopment • Redevelopment of leisure Bowl in N. Ireland of Resorts World offer offer • 29,000 sq. ft. / 20 • 20,000 sq. ft. / 17 lanes • Large catchment area >
Slide 20: Ready to Reopen
READY TO REOPEN SALES & SERVICE SAFETY TEAM • Digital marketing • COVID-secure • Re-launch of cultural campaigns – operations are now induction for every team advertising and CRM standard ways of member • Reopening awareness working • New pin badge – local and national • Unique balls per lane progra
Slide 21: Well-Positioned to Recover to Pre-Pandemic Levels
WELL-POSITIONED TO RECOVER TO PRE-PANDEMIC LEVELS • Centres ready to reopen with COVID secure protocols built to maximise capacity and profit • Strong customer demand expected upon reopening • Centre refurbishments, business infrastructure improvements and cost saving initiatives completed during th
Slide 22: Appendices
APPENDICES Hollywood Bowl Group plc
Slide 23: Business Overview and History
BUSINESS OVERVIEW AND HISTORY MULTIPLE REVENUE STREAMS* NATIONAL SCALE CUSTOMER FOCUSED INDUSTRY LEADER • Market leader in size, profitability and margin Other • Customer focused, value for money family (0.7%) experience Amusement machines • High quality property portfolio (23.7%) Bowling • Refurbis
Slide 24: Strong Business Pre COVID: Ready to Return to Growth
STRONG BUSINESS PRE COVID: READY TO RETURN TO GROWTH KEY FINANCIAL METRICS FY2019 LFL REVENUE SPEND PER OPERATING DIVIDENDS GROWTH GAME PROFIT SINCE MARGIN 2 IPO +5.5% £9.64 21.9% £47.7M GROUP ROI ON TOTAL EBITDA REVENUE REFURBS MARGIN 2 GROWTH 29.4% 46.1% +7.8% 1 FY2019 metrics 2 On a pre-IFRS 16 b
Slide 25: H1 COVID-19 Response
H1 COVID-19 RESPONSE 23 OCTOBER 2020 ★Welsh centres close under national lockdown (reopen 9 November, close again 4 December) 2 NOVEMBER 2020 ★Scottish centres close under new levels system 5 NOVEMBER 2020 ★English centres close under national lockdown (reopen 2 December in Tier 2 locations) 1 DECEM
Slide 26: Management
MANAGEMENT Stephen Burns - Chief Executive Officer • Appointment: Stephen joined the Group as Business Development Director in 2011. He was promoted to Managing Director in 2012 and became Chief Executive Officer in 2014. • Skills and experience: Before joining the Group, Stephen worked within the h