Ten Entertainment swings to loss as pandemic gutters sales
Bowling alley chain Ten Entertainment swung to a loss in the first half of 2020 after a nationwide lockdown during the coronavirus crisis slashed revenue in half.
The results
Revenue slumped 46 per cent to £22.5m in the six months to 28 June, down from £41.4m in the same period last year.
The group booked a pre-tax loss of £5.1m for the half-year, compared to a profit of £4.7m in 2019.
Group adjusted earnings before tax, amortization and depreciation (Ebitda) sunk to a loss of £1.5m, down from a profit of £11.2m last year.
The bowling chain saw net debt swell to £6.7m, which more than doubled year-on-year.
Ten Entertainment withheld from declaring an interim dividend.
Shares were up 2.4 per cent to 127p in early trading.
Why it’s interesting
The coronavirus crisis wiped out a strong start to the year for Ten Entertainment, when like-for-like sales grew 9.6 per cent prior to the PM’s announcement of a national lockdown.
The group cited “very significant disruption” during the coronavirus crisis after it was forced to shutter all 46 of its sites across the UK.
However, the bowling alley managed to bolster its financial position by rolling out a strict cost-cutting regime which reduced cash burn by 70 per cent over the six-month period.
It also secured £4.9m of equity funding from shareholders within a week of the start of lockdown, providing the group with long-term resilience.
Ten Entertainment said it has “recovered quickly from lockdown as restrictions were eased”, with all 46 of its bowling alleys around the country now open.
The group now has its eyes set further afield, after it last week opened up a new site in Manchester, with further estate expansion under review.
Ten Entertainment has now returned to profit and cash generation despite operating just half of its usual capacity with social distancing measures in place.
What Ten Entertainment said
Graham Blackwell, chief executive of Ten Entertainment, said:
“We are really encouraged by our reopening performance. Our primary focus is to return the business to the trend of the first quarter through our strengths in operational improvements and commercial innovation. Our proven strategy remains relevant, and with a track record of eight consecutive years of like-for-like sales progression, I am confident that we will return the business to growth.”