Hollywood Bowl investors strike gold as firm pays out after profit rise
Shares in Hollywood Bowl rose almost nine per cent this morning as investors were bowled over by a sharp rise in full-year profit and a special dividend.
Read more: Hollywood Bowl strikes double figure profit growth
The figures
Revenue rose 5.5 per cent on a like-for-like basis to £129.9m in the 12 months to the end of September.
Pre-tax profit jumped more than 15 per cent to £27.6m.
The firm slimmed down its debt pile from £2.5m to £2.1m.
Hollywood Bowl paid a special dividend per share of 4.5p, taking the total payout to 11.93p, up more than 12 per cent.
Why it’s interesting
The results round off a bumper year for Hollywood Bowl, which has delivered striking growth in both revenue and profit.
The firm credited its success to a string of rebrands and refurbishments, which have breathed new life into its bowling alleys.
Hollywood Bowl opened two new sites over the year, including Intu Lakeside, the largest bowling centre to be opened in the UK in the last 10 years. Six further openings are in the pipeline between 2021 and 2023.
The group has also branched out into three Puttstars mini-golf trial centres as it looks to cash in on growing demand for competitive socialising.
In addition, Hollywood Bowl has succeeded in squeezing more revenue from its customers, after investing in new technology, as well as new bar and dining layouts. Average spend per customer was up 4.5 per cent over the year.
“We continue to view Hollywood Bowl as a core holding in the sector. Its 60-strong estate is well located and invested, with an attractive pipeline secured and a well-positioned low ticket offering,” said Greg Johnson, research analyst at Shore Capital.
Hollywood Bowl announced a special dividend as it returns capital to shareholders, and said it was on track for further strong performance in the coming year.
Read more: Hollywood Bowl boosts revenue in strong first half
What Hollywood Bowl said
Chief executive Stephen Burns said: “I am delighted to report another year of strong profitable and cash generative growth, demonstrating the consistent delivery of our proven, customer-led strategy.
“In addition to driving these further strong returns, we also achieved excellent customer feedback following the ongoing investment in our centres, further innovation of our industry-leading customer proposition and the continued development of our team members. We also increased the size of our portfolio to 60 high-quality, all profitable centres.
“As a result of this strong financial and operational performance, we are delighted to announce a special dividend for the third consecutive year, which will result in a total of £47.7m being returned to shareholders since our initial public offering.”
Main image credit: Hollywood Bowl