Hollywood Bowl (BOWL ), the largest ten-pin bowling operator in the UK and Canada, reported record revenues and continued expansion for the year ended 30 September 2024. Key highlights include:

  • Revenue: £230.4 million, up 7.2% from FY2023.
    • UK revenue: £199.7 million, up 3.8%.
    • Canada revenue: CAD 53.0 million (£30.7 million), up 42.2% on a constant currency basis.
  • Group like-for-like (LFL) revenue growth: 0.2%.
    • UK LFL: 0.0%.
    • Canada LFL: +6.3%.
  • Expected EBITDA pre-IFRS 16: in excess of £65.0 million, above market expectations.
  • Added eight centres in FY2024: four in the UK and four in Canada.
  • Net cash: £28.6 million, following significant capital investments.
  • On track to reach 130 centres by 2035, with strong pipeline for new centres in FY2025.

Hollywood Bowl’s growth strategy focuses on expanding its estate in both the UK and Canada, enhancing customer experience, and driving profitability.

 

View from Vox:

 

Hollywood Bowl Group continues its impressive expansion with another year of strong growth in both revenue and operational performance. The company’s strategy of delivering high-quality, affordable leisure experiences in the UK and Canada is yielding positive results, as evidenced by record revenues of £230.4 million, an increase of 7.2% year-on-year. The Group’s ability to exceed market expectations with EBITDA surpassing £65 million is a testament to its operational efficiency and solid business model.

UK Performance: The UK market remains stable, with flat like-for-like growth reflecting a natural normalisation after years of exceptional performance. However, 0.3% LFL growth in bowling centres demonstrates resilience amid economic pressures. Refurbishments and the rollout of new technologies, such as the customer reservation system, have enhanced the customer experience, increasing dwell time and spend-per-game.

The standout story is Hollywood Bowl’s aggressive expansion in Canada, where revenue grew 42.2% on a constant currency basis. The opening of four new centres, including the company’s first new development in Waterloo, Ontario, underscores the potential of the Canadian market. The Group’s strategy of refurbishing centres and expanding geographically is paying off, with strong customer feedback and LFL revenue growth of 6.3% in Canada.

Hollywood Bowl’s ongoing investment in solar energy for its UK estate (with 42% of centres fitted with solar panels) is a forward-thinking move to reduce energy costs and environmental impact. Additionally, over 70% of revenue is insulated from cost-of-goods inflation, providing stability in an inflationary environment.

Hollywood Bowl’s long-term strategy to reach 130 centres by 2035 is ambitious, but achievable given its track record. The Canadian market, offers significant growth potential, and further international expansion may be a logical next step.

Hollywood Bowl remains a solid player in the leisure sector, with strong cash flow, a clear growth strategy, and increasing market presence. For investors seeking exposure to the entertainment and leisure industry, Hollywood Bowl presents a compelling opportunity for long-term growth.