Hollywood Bowl profits and revenue jump, special divi announced again

Hollywood Bowl posted a jump in full-year profit and revenue on Monday as it announced a special dividend for the second year in a row.

In the year to 30 September, pre-tax profit was up 13.4% to £23.9m on revenue of £120.5m, up 5.8%. Group adjusted earnings before interest, taxes, depreciation and amortisation were 8.3% higher at £36.2m. Like-for-like revenue during the year rose 1.8%, down from 3.5% growth in 2017, while average spend per game was up 6.1% at £9.22.

The company announced a special dividend of 4.33p a share, up 30% on the previous year's, while the final dividend came in at 4.23p a share, up 7.1%. The total dividend for the year grew 16.6% to 10.59p a share.

Meanwhile, net debt fell 69.1% to £2.5m thanks to "strong" cash generation.

Hollywood Bowl opened two new centres during the year and has currently exchanged on eight new centres, securing the pipeline for the next four years.

Chief executive Stephen Burns said: "I am very pleased with the group's full year performance. Operating our business in line with our customer led strategy has delivered another strong revenue performance which, combined with our continued focus on cost management, has resulted in a year of record profits and significant operating cash generation.

"The investment into our high quality portfolio of 58 profitable centres continues to deliver significant, above target, returns. Our new centres are performing very well and we have secured a strong pipeline of new openings that will further enhance the quality of our portfolio."

Shore Capital analyst Greg Johnson said LFL growth of 1.8% was a "highly credible" performance given the weather - snow in the first half and the hot summer - and England's strong showing in the World Cup. In addition, the special dividend was above his forecast of 3.6p a share.

Russ Mould, investment director at AJ Bell, said: "Earnings beat expectations at the profit level, plus shareholders are being given a special dividend for the second year in a row.

"It shows that classic leisure activities still have a life of their own despite being surrounded by a whirlwind of come-and-go trends which compete for the consumer’s wallet.

"Nothing beats some competitive fun time with family and friends and Hollywood Bowl has done its very best to ensure that prices remain affordable while also finding ways to get customers to spend more money once in its centres."

At 1000 GMT, the shares were up 8.2% to 198.50p.