Britain’s biggest ten pin bowing Hollywood Bowl has defied hospitality sector woes with bumper profits on the back of its cheap night out appeal.
The company posted revenues of £185 million for the year to 30 September, up 42% on pre-pandemic levels, with earnings up 40% to £38 million, ahead of analyst expectations.
The firm will open two new sites early next year and has plans for a further 10 before the end of 2025.
Customers were spending more time at bowling venues, the company said, while the average customer spend had increased despite bowling prices staying flat on 2019 levels. Food prices were down on 2019, in part as a result of a reduction in menu options to sidestep inflation pressures.
Hollywood Bowl CFO Laurence Keen told the Standard: “Maintaining good value is important to us. Because of the multiple revenue streams that we have, food accounts for less than 10% of our revenue, so a large food price rise doesn’t massively move the cost structure in our business.” The average spend is less than £42 per family.
The firm has hedged its energy contracts up to September 2024, insulating it from some of the crippling gas and electric bill price hikes other hospitality businesses have wrestled with.
Roberta Ciaccia, leisure analyst at Investec bank, said: “Within the leisure space there is a lot of headwinds at the moment, [but Hollywood Bowl is] way more protected than the others because they’ve kept under control labour costs, they hedged energy and aren’t exposed to food…plus the bowling side of things basically has a 100% margin because it’s all automated once you’ve installed it.
“This is a company which generates cash, and has plenty of cash in a growing interest rates in environment and can distribute dividends that are more generous than analysts expect.”
Hollywood Bowl shares grew 5.3% to 214p in early trading.
