Premium cinema operator Everyman Media (EMAN:AIM) saw a strong rebound in the year to December 2021, with admissions surging 67% to £2 million on pent-up demand.
Admission levels are getting back to pre-pandemic levels and in the second half of 2021 were 97% of 2019 on a non-like-for-like basis. The company said momentum had continued into the new financial year.
A ‘strong and varied’ film slate is expected in 2022 with a good mix of major releases including James Bond and Spiderman as well as the popular independent movies so beloved by Everman’s customers.
Investors welcomed the positive outlook and the shares gained 2% to 132p.
EXPANSION RECOMMENCED
The company operates from 36 venues across the UK after opening its latest venue Borough Yards in December 2021. It has a committed pipeline of four new sites for 2022, covering Edinburgh, Plymouth, Marlow, and Egham.
The group said it has ‘significant headroom’ to fund its expansion plans and said since reopening on 17 May 2021 it has been cash flow positive in every single month.
At 31 December, the company had cash of £4.2 million and net debt of £8.4 million, leaving liquidity headroom of £24.6 million.
STRONG REBOUND
Despite venues being closed for 19 weeks due to lockdown restrictions, revenues doubled to £49 million last year. This is around a fifth below 2019 revenues.
The strong rebound turned last year’s £0.3 million adjusted operating loss into an adjusted operating profit of £8.3 million. On an unadjusted basis the operating loss was reduced by 88% to £2.2 million.
Average ticket prices fell 3% driven a higher mix of children’s tickets and a better showing of cinemas outside London.
Everyman cinemas have a focus on providing first class hospitality and experiences. All the food is produced in-house. Management appears to have done a good job with the average spend on food and drinks increasing by 27% to £8.96.
The increase by driven by the roll-out of hand-held ordering machines, kitchen upgrades and a new menu. Increased social media engagement and app usage also contributed.
Everyman is the fourth largest cinema chain in the UK by number of venues and the strong bounce in 2021 saw it increased its market share to 4.5%.
EXPERT VIEW
Leisure analyst at Canaccord Genuity Mark Photiades commented: ‘The investment made in the Group’s F&B offer and other operational improvements have resonated with customers and helps to further differentiate the brand’s offer vs competition.
‘Fundamentally, Everyman remains a strong consumer brand with a unique offering, and we continue to believe it is well-positioned for further growth in what is likely to be a more advantageous property market going forward.’
