XP Factory (XPF) , the experiential leisure company operating the Escape Hunt and Boom Battle Bar brands, issued a short trading update and announcement that its results for the 15 months to March 31, 2024, would be released on September 2, 2024, alongside investor meetings in the days thereafter. As previously announced, XPF's year-end was moved to March 31, resulting in the prior fiscal year having 15 months.
XPF said it traded in line with management expectations in the first quarter of the financial year to March 2025, with continued positive, volume-driven like-for-like growth across both its brands. Investors can expect a comprehensive account of current trading in September's final results.
In May 2024, XP Factory issued a more detailed update on trading to March 31, 2024 where the experiential leisure company reported turnover of £57.8m vs £22.8m LY, with both brands seeing strong LFL sales growth in the 13 weeks to March 31, 2024. Revenues were up 11.6% and 11.7% respectively for Boom and and Escape Hunt during the quarter, and overall performance was in line with market expectations for the full-year. Robust LFL growth was driven by new acquisitions and maturing of sites opened in the latter part of 2022, and expansion of owner-operated estates of both Boom and Escape Hunt.
Recent positive performance follows material growth throughout calendar 2023 as the group aggressively expanded its footprint, effectively doubling in scale for the 2nd year running. At the same time, XPF generated £9.5m in cash from operations (of which £6.9m was invested in capex) while maintaining healthy gross margins of 64.2%. The expansion trend is bound to continue, with a pipeline of further site openings being advanced this year. Cash on December 31, 2023 was £4.4m, with both brands having significant runways ahead of them.
Overall, experiential leisure has shown strong demand despite recent headwinds, and XP Factory's aggressive expansion strategy is paying off. The sector has proven to be highly resilient, with competitive socialising in particular growing steadily at 13% per year, partially driven by corporate sales. Therefore, we expect further expansion from XPF in the short-term at a pace consistent with cash generation.
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