UK bowling company Ten Entertainment (TEG:AIM) reported close to double digit growth in revenues for the first half of the year to 30 June 2019 to £41.4m, giving the shares a 1% leg-up to 235p.
Like-for-like revenue growth was 7.4% and benefited from the comparative period from May and June last year, which experienced extreme hot weather conditions. The company said that underlying like-for-like growth remained stable and ‘encouraging’.
The site footprint continued to expand with two new acquisitions, at Southport in the first quarter and Falkirk in the second, bringing the total number of venues to 45. Targeted investment is expected to see a profit contribution in 2020.
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Chief executive Duncan Garrood said ‘the business has shown strong growth in the first half driven by the continuous improvement of the quality of the customer proposition and accelerated investment in digital marketing’.
INVESTMENTS DRIVE LONG-TERM GROWTH
The company has accelerated its focus on investing in the customer experience with more targeted marketing and online activity as well as product innovation. The benefits are expected to drive long-term growth and will begin to show financial benefits at the end of the second half.
Management said that it was on track to deliver earnings before interest, depreciation and amortisation (EBITDA) in-line with expectations.
The market consensus according to Reuters shows EBITDA growth of 18% to £24.3m for the full year to December 2019, which implies an enterprise value to EBITDA of 6.6 times.
