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Wed 25th May 2022 - Update: Hollywood Bowl, slowdown in business activity, Pret sales
Hollywood Bowl takes first international steps as it buys Canadian business for £10.6m: Hollywood Bowl, the UK’s largest ten-pin bowling operator, is to expand internationally with the acquisition of Canadian-based bowling business, Teaquinn Holdings, for a total consideration of CA $17m (£10.6m). The deal will be satisfied by an initial payment of CA $13.6m in cash and a deferred consideration of CA $3.4m. Teaquinn comprises of Splitsville, an operator of ten-pin bowling centres, and Striker Bowling Solutions, a business-to-business supplier and installer of bowling equipment. Pre-covid, Splitsville operated four bowling centres with CA $12.3 million revenue and CA $2.7m Ebitda on a pre-IFRS 16 basis. A fifth centre was acquired in 2021. The acquisition will be funded from Hollywood Bowl Group’s existing cash resources and is expected to be earnings accretive for the year ending FY2023. Teaquinn’s founder and president, Pat Haggerty, will remain with the business and be incentivised by a separate, capped, earn out scheme that crystalises no earlier than the end of FY2025. Hollywood Bowl Group stated: “The group believes there is significant opportunity to add value to the existing Splitsville business and, in a highly fragmented and underinvested market, the group has identified a pipeline of acquisitions as well as new site opportunities – with returns in line with Hollywood Bowl’s financial investment criteria – and the potential to add up to ten sites over the next five years.” Stephen Burns, chief executive of Hollywood Bowl Group, said: “We are delighted to have acquired Splitsville and Striker Bowling Solutions, which marks a key milestone as we take our first step internationally. This is a unique opportunity to acquire a well-run business with an experienced existing management team in a new territory where we see significant potential for sustained profitable growth. Canada shares many similarities with the UK bowling market and we believe there is unmet demand for well-invested, affordable, family-friendly bowling led experiences. We are confident that Splitsville’s operations and brand will provide us with an excellent platform for further growth and that together with Pat and his team we can continue to enhance and evolve Splitsville’s existing customer offer through our extensive indoor leisure experience.” Haggarty added: “We share an ambition and vision for the long-term growth of the business and crucially, we are a great cultural fit. Hollywood Bowl Group has led the ten-pin bowling industry in a number of ways for many years and I am looking forward to working with Stephen and his team and applying their knowledge and experience to our operations in ways that will enhance our customers experience as we grow the business.”

Variety of experiential concepts set to join updated Premium Database of Multi-Site Companies: A variety of experiential concepts are among the 42 new multi-site companies being added to the next edition of the Propel Premium Database of Multi-Site Companies, which will be released on Friday (27 May), at midday. The updated Propel Multi-Site Database, which is produced in association with Virgate, features Louth-based climbing gym concept Ascend Climbing Gym, which is owned by Darren Thompson, and is opening a second site, in Lincoln. Meanwhile, padel tennis concept Padel4all, which was founded three years ago by Christopher Wilkinson, and currently operates two sites, in Swindon and Southend, will be included. Also featured is Level Up Entertainment, the Middlesbrough-based operator of escape room attraction Project Escape, which has sites in the town’s Dundas Centre and Hexham, and a new 18-hole adventure golf course called Putter Chaos, also in the Dundas Centre. Premium subscribers will also receive a 3,212-word report on the new additions to the database. The comprehensive database is updated monthly and provides company names, the people in charge, how many sites each firm operates, its trading name and its registered name at Companies House if different. It features more than 2,000 companies. Premium subscribers will also receive the next edition of the New Openings Database, which is produced in association with StarStock, on Friday, 3 June, at midday. It focuses on newly announced openings and upcoming launches in the sector and is updated every month. The next edition also includes a 12,000-word report on the new additions to the database. Premium subscribers also receive access to the Propel Turnover & Profits Blue Book, which is produced in association with Mapal Group. The Blue Book, which is also updated monthly, provides an insight into UK operator turnover and profitability over five years, profit conversion and directors’ earnings. Premium subscribers also get exclusive access to the UK Food and Beverage Franchisor Database, which is an exhaustive guide to the companies offering a food and beverage franchise in the UK and will be updated every two months. The second edition, which was sent on Friday (20 May), features 120 companies, providing insight on the offer, locations, cost and other key details. The second edition provides almost 47,000 words of content. Companies can now have an unlimited number of people receive access to Propel Premium for a year for £895 plus VAT – whether they are an operator or a supplier. The single subscription rate is £445 plus VAT for operators and £545 plus VAT for suppliers. Email to upgrade your subscription. Subscribers also receive access to Propel’s library of lockdown videos and Friday Wrap interviews and now also have access to a curated video library of the sector’s finest leaders and entrepreneurs, offering their insights on running outstanding businesses in the sector. Premium subscribers also receive their morning newsletter 11 hours early, at 7pm the evening before our 6am send-out; regular video content and regular exclusive columns from Mark Wingett.

Hollywood Bowl reports record first-half performance: Hollywood Bowl, the UK’s largest ten-pin bowling operator has reported a record first-half performance with pre-tax profit increasing 51.5% to £24.8m (2021: £16.4m) for the six months ending 31 March 2022. Group adjusted Ebitda increased 46.8% when compared to the same period in 2019, to £31.0m. The company has reinstated its dividend with an interim dividend of 3p per share. No government support was taken during the period as the business was able to continue to trade with only a limited impact from Omicron in December 2021. Two new centres opened in the first half – Hollywood Bowl Resorts World, Birmingham and Puttstars, Harrow and are “performing well”. Hollywood Bowl Belfast opened in April 2022 and two new centres are planned to open within the next six months, with a “strong” new centre pipeline for Hollywood Bowl and Puttstars brands to meet openings target. Two refurbishments have been completed since year end with three further planned – on track to meet guided refurbishment target of seven-ten centres by year end. Games like-for-like volumes increased 18.1% and average spend per game up 7.5% to £10.52. Amusement revenue was up 43.6% following improvements to games and layouts. Food revenue was up 8.4% as we retained simplified food menu and reduced prices by 10.9% while focusing on quality and speed of service. Drinks like-for-like revenue up 22.9% supported by lane ordering technology. As previously reported, like-for-like sales were up 26.8% and revenue stood at £91.3m, up 659.4% on the previous year (£12m), with a 36.3% rise in total revenue growth compared with the same period in 2019. Chief executive Stephen Burns said: “We saw exceptional pent-up demand in the first half which, in addition to the investments made in our customer experience, led to us achieving a record first half with four of our top performing months ever. I am very proud of the hard work that went into delivering this excellent performance with high customer satisfaction scores and we were delighted to reward our team members as well as now reinstating our dividend. The strength of our balance sheet supports our ability to continue to invest in our growth strategy. While we are aware of the financial challenges many of our customers are facing, we continue to provide a great value for money experience. We are confident that demand will remain resilient as families seek out affordable leisure activities.”

Britain seeing sharp slowdown in business activity as grocery prices rise at fastest rate in 13 years: Britain is seeing a sharp slowdown in business activity while separate figures showed grocery prices are rising at the fastest rate in 13 years. The S&P Purchasing Managers’ Index (PMI) fell sharply in May to 51.8. It was a drop from 57.6 in April and its lowest level since last February and the fourth sharpest slowdown on record. The PMI measures the direction of economic trends in the manufacturing and services sector, with any reading under 50 representing a contraction. The service sector, which includes the travel industry and media and entertainment, suffered the most as customers reined in spending in the face of uncertainty sparked by soaring inflation amid the war in Ukraine. Analysts said the PMI data raised the prospect of stagflation, which is when slow growth is accompanied by rocketing prices. Meanwhile, figures from Kantar showed grocery price inflation hitting 7%, its highest level since May 2009. More than a fifth of households said they are struggling to make ends meet, with almost all of these blaming the cost of a weekly shop. Meanwhile, only one in three shoppers consider themselves to be in a “comfortable” financial situation, Kantar found.

Pret sales in London’s financial districts dipping up to 80% on Fridays as bankers steer clear of the office: London’s financial districts have filled up again, driving weekday business to cafes and sandwich shops – except on Fridays. The number of customers visiting Pret A Manger shops in the city’s banking hubs is almost back to pre-pandemic levels, but it crashes by up to 80% every Friday. Bloomberg’s Pret Index showed the anomaly is holding back an otherwise successful return-to-office push. The figures show the hybrid model of working part of the week from the office and the rest from home is still overwhelmingly popular in industries such as banking, where firms are raising pay and addressing burnout issues amid a war for talent. Sales in London’s entertainment and shopping district are about a fifth above pre-pandemic levels. Pret’s business in London’s airport terminals is now a quarter higher than it was before the pandemic as business and leisure travel roars back. Pret has recently prioritised growth in suburban and regional areas of London, according to chief executive Pano Christou, who anticipates most employers will permanently offer hybrid home-and-office working arrangements. Pret’s transactions in London train stations dipped slightly but are still hovering around pre-crisis levels.

Manchester-based bakery concept Pollen to open second site next week: Manchester-based bakery concept Pollen will open a new pastry kitchen and cafe at the city’s Kampus garden neighbourhood next week. The independent sourdough and viennoiserie bakery is relocating its pastry team to Kampus and launching an expanded brunch menu, as it expands on its original site, which opened in 2016 in a railway arch underneath Piccadilly train station before relocating to Ancoats two years later. The new pastry kitchen and garden will open a 2,600 square foot unit on the ground floor of Kampus on Friday, 3 June. Customers will be able to see the patisserie masters at work within an open kitchen. The new location, which will look out over the Kampus garden, will feature a cafe with indoor and outdoor seating. Chris Kelly, who founded Pollen with Hannah Calvert, said: “Our second location in Kampus forms part of our evolution and growth. After drastically running out of space at our Ancoats bakery, the new location re-homes our pastry team in a dedicated pastry kitchen behind a glass gallery so you can see all the action taking place throughout the day and the masters at work. We will still serve the full range as usual at the Marina, but the new kitchen will allow us so much more creative freedom. With a bigger café space, we’re creating a brand new, modern, refined menu which will change with the seasons and showcasing the best produce available at the time. We’re working with some fantastic suppliers and can’t wait to show you a taste of what we’re working on.”

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