Leisure group Ten Leisure has upped its full-year outlook after the development for staycations amid the pandemic drove its finest summer time season.
The agency, which runs 10-pin bowling lanes and comfortable play centres, mentioned gross sales surged 22.5% within the first six weeks since reopening on Could 17 after which rocketed by 42% within the 11 weeks since June 27 over the summer time vacation season.
Shares within the agency rose 5% because it mentioned the full-year outlook was now anticipated to beat expectations because of the rebound, which it mentioned noticed “essentially the most profitable summer time buying and selling interval within the group’s historical past”.
This comes regardless of a rocky first half, with the agency revealing that lockdown web site closures noticed underlying pre-tax losses widen to £10.7 million for the six months to June 27, in opposition to losses of £6.2 million a yr earlier.
It mentioned the enterprise was closed for the primary 20 weeks of the half-year.
Chief government Graham Blackwell mentioned: “Our exhausting work within the first 5 months of the yr in getting ready for the absolute best opening has been rewarded by an distinctive stage of gross sales development on reopening.
“The short-term increase from UK staycations and the pent-up demand has not but subsided, however we do anticipate it to over time.
“Nonetheless, we anticipate that the stable underlying ranges of demand will proceed for the enterprise and that we are able to return sustainably to our earlier observe document of development.”
The group, which additionally runs Houdini Escape Rooms as a part of a three way partnership, mentioned it was seeing some strain on revenue margins from value rises as a consequence of labour shortages and wider inflation.
However Mr Blackwell instructed the PA information company the group would hold costs low for purchasers and mentioned it had secured its vitality costs till the beginning of 2024, which ought to defend it from the present hovering fuel prices.
He mentioned: “We think about these inflationary pressures to be manageable.
“Our pricing technique will stay to supply good worth to our clients and to make use of the resultant elevated footfall and frequency because the engine for revenue development.”
He added: “If the worth of fuel quadrupled, then we’d have to take a look at doing one thing (on worth).”
However he mentioned the group’s transfer to safe suppliers and contracts throughout lockdown was serving to protect the group and permit it to carry off from passing on prices to clients.
He cautioned the CO2 scarcity posed extra of a direct menace to the sector, given its excessive gross sales of fizzy drinks throughout its 46 websites, and welcomed the Authorities’s transfer to step in and safe short-term provide with US producer CF Fertilisers.
The group additionally confirmed plans to increase its 46-strong chain with 4 new centres in 2021-22, in addition to refurbishing 4 key websites, and is increasing its Houdini three way partnership to 30 escape rooms throughout 12 areas by the yr finish.
Douglas Jack, an analyst at Peel Hunt, mentioned: “Ten Leisure is in a candy spot of the sector, benefiting from development in experiential leisure, however with little publicity to labour and shopping for prices.”