Escape Hunt (LON:ESC) tapped into the strong demand for escape rooms among friends looking for an alternative to a normal night out, and work dos with a twist, posting good progress across its full-year fundamentals.
Across its owner-operated sites, the group’s unaudited revenue bounced from £1.1 million to £3.8 million year-on-year for the full year.
Additionally, the company’s most mature sites delivered like-for-like sales growth of 34% during the final quarter of FY19. During December, like-for-like sales jumped 70% across all eight of the group’s owner-operated sites.
The company added that its EBITDA was ahead of management’s expectations, and its number of UK game rooms widened from 38 to 49 during the year.
Regarding its franchise estate, the company delivered revenue of £1.0 million, which was in line with 2018. Its EBITDA was in line with expectations and ‘good progress’ was made with its US franchise partner.
Escape Hunt comments
Company Chief Executive Richard Harpham commented:
“We are pleased with our progress in FY19. The performance of our owner-operated sites continues to give us confidence in the proposition and opportunity in the UK. The signing of the US franchise deal marked a significant step in accelerating the growth of our franchise business. Finally, we have made significant steps towards reducing the average unit build cost underpinning our confidence in the underlying returns profile for the business.”
“Our ambitious growth plans are centred on driving growth in our existing sites and expanding our footprint, which is underpinned by leveraging our market-leading brand. We remain excited by the significant opportunities ahead of us.”
Following the update, the company’s shares have dipped 5.97% or 0.93 p to 14.58p per share 04/02/20 15:04 GMT. The Group’s market cap stands at £4.11 million, Peel Hunt analysts downgraded their stance from ‘Buy’ to ‘Hold’ on the company’s stock.
Escape Hunt performed well in 2019 with demand for escape rooms gaining momentum over time. The increasing diversity of activity-focused recreation and leisure opportunities, and the potential for the trend bubble to burst, both perhaps weigh on investors’ confidence in the company going forwards.