Nightcap (NGHT ), the prominent owner and operator of 46 premium bars, has announced a record-breaking trading update for the 2024 Christmas period, as well as for the 13 and 26 weeks ending 31 December 2023. Achieving these milestones in the face of ongoing economic challenges, including train strikes, inflation, and the cost of living crisis, highlights the company’s robust performance and resilience.

Festive Trading Success

During the crucial four-week festive period ending 31 December 2023, Nightcap achieved unprecedented revenue, recording a 65.7% increase compared to the same period in 2022, with unaudited Group revenue reaching £7.4 million. This surge also reflects an 11.9% like-for-like increase. December 2023 proved to be the most successful month in the company’s history since its IPO, with total revenues soaring to £9.2 million, up 55.9% from December 2022.

Quarterly and Half-Yearly Growth

The company also reported significant growth for the 13-week period (Q2 FY2024), with unaudited Group revenue of £18.0 million, marking a 39.0% increase over the same period in FY2023. This period saw a notable improvement in like-for-like revenue performance, driven by strong Christmas trading, integration of new bars, and the maturing of sites opened in the past year. The 26-week period (H1 FY2024) also saw a remarkable increase, with revenues hitting £32.7 million, a 40.9% rise from FY2023, although there was a 10.0% like-for-like decrease compared to FY2023.

Financial Position and Acquisitions

As of 31 December 2023, Nightcap’s cash position stood at £3.9 million, with a net debt position of £5.0 million, excluding convertible loan notes. The company has also successfully negotiated the payment of deferred consideration for the acquisition of DC Bars Limited and Tuttons Brasserie Limited.

Management’s Outlook

Sarah Willingham, CEO of Nightcap, expressed immense pride in the team’s achievements, highlighting the significant growth amidst a challenging year for the hospitality sector. She noted the positive developments regarding the resolution of rail strikes and the control of inflation, which are expected to favourably impact the disposable income of their target customers in 2024. Willingham emphasised the company’s transformation and integration efforts in the latter half of 2023, setting the stage for future growth and synergies.

View from Vox

Nightcap’s performance in the face of adversity is nothing short of impressive. The record-breaking revenues during the Christmas period and consistent growth over the last half of the year underscore the company’s strategic resilience and adaptability. The integration of new acquisitions and the maturing of recently opened sites demonstrate a well-executed expansion strategy. The hospitality sector however, remains vulnerable to macroeconomic factors. While Nightcap has navigated these challenges successfully, the industry as a whole faces uncertainty, especially with the ongoing cost of living crisis. The company’s forward-looking approach, focusing on customer experience and operational efficiency, will be key in maintaining its growth trajectory.

Nightcap’s success story is a testament to the potential of well-managed hospitality ventures, even in tough economic times. The company’s ability to leverage its acquisitions and optimise its operations bodes well for its future. However, as with any business in this sector, staying vigilant and adaptable to changing economic conditions will be crucial for sustained success.

In conclusion, Nightcap’s achievements in a challenging environment are commendable, and its proactive strategies place it in a strong position for continued growth. The focus now should be on maintaining this momentum, ensuring customer satisfaction, and leveraging market opportunities as they arise.