TIDMXPF
RNS Number : 8524Y
XP Factory PLC
09 September 2022
9 September 2022
XP Factory Plc
("XP Factory", the "Company" or the "Group")
Acquisition of Boom Battle Bar Cardiff Limited
and
Update on site openings and trading
XP Factory (AIM: XPF), a leading UK experiential leisure
business operating the Escape Hunt(TM) and Boom Battle Bar(TM)
brands, announces the acquisition of Boom Battle Bar Cardiff
Limited, which owns and operates the Boom Battle Bar site in
Cardiff, and provides an update on progress since its announcement
on 31 May 2022 of the results for the year to 31 December 2021
("FY21").
Acquisition of Boom Cardiff
XP Factory has acquired 100% of Boom Battle Bar Cardiff Limited
("Boom Cardiff") for an enterprise value of GBP2.15m. Boom Cardiff
was the third Boom Battle Bar site to open and has been operating
as a franchise site since September 2020 prior to the acquisition
last November of Boom Battle Bars by XP Factory. It is a strong
performer in the network and, in the twelve months ended 30 June
2022, delivered unaudited turnover of GBP3.82m, adjusted EBITDA of
GBP438k [1] and profit before tax of GBP201k. As at 30 June 2022,
Boom Cardiff had net debt of approximately GBP620k [2] including
GBP220k of loans due to XP Factory. The estimated net consideration
payable of GBP1.53m will be satisfied by a payment of GBP600k in
cash on completion, a further GBP600k six months after completion,
and the balance, which will be subject to a completion accounts
mechanism, on the first anniversary of the acquisition. The
unaudited net assets of Boom Cardiff as at 30 June 2022 were
GBP240k.
Boom Cardiff, which is located on Caroline Street in the Brewery
Quarter in central Cardiff is a popular destination for consumers.
The site offers a variety of competitive socialising games and
activities, including Bavarian Axe Throwing, Mini Golf,
Shuffle-Board, Electric Darts, American Pool, Ping Pong as well as
other games set in a cocktail bar environment and offering 'street
food' through an on-site kitchen.
Other site progress
Since the announcement on 31 May 2022 of the Company's full year
results for FY21, further progress has been made in our site
roll-out strategy.
Boom Battle Bars
-- In June 2022, a new owner operated Boom site opened in
Manchester, located at The Printworks, 27 Withy Grove;
-- In August 2022, the Company acquired the Boom franchise site
in Norwich ("Boom Norwich") for a consideration of GBP100k in cash.
In the 12 months to 30 June 2022, Boom Norwich delivered unaudited
turnover of GBP1.2m and operated at attractive margins in line with
our expected box economics. The acquisition will be funded from
cashflows from Boom Norwich over 12 months.
-- Two further franchise sites have opened in Ealing in June 2022, and Sheffield in July 2022.
As a result, the Boom Battle Bar network today comprises 18
sites, of which six are owner operated (including Cardiff) and 12
are franchised.
The pipeline remains strong, with a further 5 owner operated
sites currently in build in Edinburgh, London (Oxford Street),
Plymouth, Leeds and Birmingham. Three further franchise sites are
also in build in Bournemouth, Chelmsford and Southampton, with
contracts exchanged on a further site for which building is
expected to commence shortly. There are several other sites in the
final phases of legal documentation and the Board remains confident
that its target of 27 open Boom venues by the end of 2022 will be
met.
Escape Hunt
A new Escape Hunt site opened in a second venue in Norwich in
August 2022, and sites are in build in Bournemouth, London (Oxford
Street) and Edinburgh, the latter two co-located with Boom sites.
These additions will take the Escape Hunt network to 23 owner
operated sites.
Update on trading
The Company's unaudited results for the six months to 30 June
2022 are expected to show Group revenue in excess of GBP8m,
compared to GBP1.2m in the same period in 2021, which was prior to
the acquisition of Boom Battle Bars.
Despite the current macro-economic backdrop, trading in the UK
since 30 June 2022 in both Boom and Escape Hunt sites has been
encouraging. The UK Escape Hunt owner-operated estate generated
unaudited turnover in the eight weeks to 28 August 2022 of
approximately GBP1.4m, an increase of 16% compared to the same
eight-week period in 2021. Adjusting for the VAT benefit received
in 2021, the underlying increase was 33%, reflecting an enlarged
network and 13% like-for-like growth from sites which were open in
the same period in 2021. Escape Hunt site level EBITDA margins
continue to exceed the Board's internal benchmark of 30%.
Performance in the Group's Boom Battle Bar estate has also been
developing positively. The owner operated sites [3] delivered
unaudited turnover in excess of GBP1m for the eight weeks to 28
August 2022 and each of the Group's sites has proved capable of
delivering margins in line with our expected box economics within
the first few months of operating, underpinning c onfidence in the
Group's business model. The Boom franchise estate provides the
Company with an increasingly consistent weekly royalty.
A fuller update on trading and prospects will be given with the
Company's unaudited interim results for the six months to 30 June
2022 which are expected to be published in the week beginning 26
September 2022.
Commenting on the Acquisition and site progress, Richard
Harpham, Chief Executive of XP Factory plc, said "We are delighted
to have been able to add the Boom Cardiff site into our owner
operated estate on attractive terms. It is consistently a strong
performing site. Likewise, the acquisition of the Boom Norwich site
is expected to provide an excellent cash on cash return. We
continue to see growing and attractive operating metrics at our
Boom sites whilst Escape Hunt has become a consistently high margin
business. Most importantly, we are seeing very high consumer
ratings for both our brands. We look forward to providing a more
detailed update with our interim results."
Enquiries:
XP Factory Plc
https://www.xpfactory.com/
Richard Harpham (Chief Executive
Officer)
Graham Bird (Chief Financial
Officer)
Kam Bansil (Investor Relations) +44 (0) 20 7846 3322
Shore Capital, NOMAD and Broker
https://www.shorecap.co.uk/
Tom Griffiths/David Coaten (Corporate
Advisory) +44 (0) 20 7408 4050
IFC Advisory - Financial PR
https://www.investor-focus.co.uk/
Graham Herring
Florence Chandler +44 (0) 20 3934 6630
Notes to Editors:
About XP Factory plc
The XP Factory Group is one of the UK's pre-eminent experiential
leisure businesses which currently operates two fast growing
leisure brands. Escape Hunt is a global leader in providing
escape-the-room experiences delivered through a network of
owner-operated sites in the UK, an international network of
franchised outlets in five continents, and through digitally
delivered games which can be played remotely.
Boom Battle Bar is a fast-growing network of owner-operated and
franchise sites in the UK that combine competitive socialising
activities with themed cocktails, drinks and street food in a high
energy, fun setting. Activities include a range of games such as
augmented reality darts, Bavarian axe throwing, 'crazier golf',
shuffleboard and others. The Group's products enjoy premium
customer ratings and cater for leisure or teambuilding, in small
groups or large, and are suitable for consumers, businesses and
other organisations. The Company has a strategy to expand the
network in the UK and internationally, creating high quality games
and experiences delivered through multiple formats and which can
incorporate branded IP content. ( https://xpfactory.com/ )
Facebook: EscapeHuntUK BoomBattleBar
Twitter: @EscapeHuntUK @boombattlebar
Instagram: @escapehuntuk @boombattlebar
[1] Adjusted EBITDA is calculated as earnings before directors'
remuneration and allocated franchisee head office costs, interest,
tax depreciation, amortisation, after franchise royalties.
[2] Net debt includes elements of working capital as defined for
the purposes of the completion accounts adjustment mechanism
[3] 4 sites for the full 8 week period, including Manchester
which opened to the public on 17 June, and Norwich for the final
two weeks
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END
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September 09, 2022 02:01 ET (06:01 GMT)
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