A staycation boom has boosted the finances of the company that owns the Brighton Palace Pier – and bosses believe that the outlook remains sunny.
The Brighton Pier Group has announced half-year financial results to Sunday 26 December which, the company said, “highlight the strength of the business model.”
The group said: “Revenues (were) up by 178 per cent to £22.8 million on the same 2020 period and importantly up 33 per cent on the same pre-covid period in 2019.
“Since the end of the last financial year the group has reduced net debt by 34 per cent.
“The outlook for 2022 is robust. Given these excellent results and a current strong trading performance, the board expects profits for the 52 weeks ending June 2022 to be ahead of market expectations.”
The Palace Pier is one of four elements of the Brighton Pier Group although it usually contributes the highest share of revenues and profits.
The company said that the pier “offers a wide range of attractions including two arcades, with over 300 machines, and 18 funfair rides, together with a variety of on-site hospitality and catering facilities”.
It added: “According to Visit Britain, it was the fifth most popular free attraction in the UK prior to the pandemic, with over 4.9 million visitors in 2019, making it the UK’s most visited landmark outside of London.”
The other three parts of the business are
- the golf division, which trades as Paradise Island Adventure Golf and operates eight indoor mini-golf sites at high footfall retail and leisure centres
- the bars division, which trades under a variety of concepts including Embargo República, Lola Lo, Le Fez, Lowlander and Coalition
- Lightwater Valley theme park in North Yorkshire
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The company said: “The group performed better than expected for the 26 weeks ended (Sunday) 26 December 2021, with the restrictions from the pandemic being less extensive than in the prior period.
“And, when the businesses were able to trade, they performed well and benefited from pent-up consumer demand. Consequently, the group delivered substantial increases in both sales and profitability.
“The strategy of the group remains focused on capitalising on the potential of its diversified portfolio of leisure and family entertainment assets in the UK.
“The board believe there is significant organic growth potential across the portfolio, in particular, from the golf division and the recently acquired Lightwater Valley theme park.
“Alongside maximising the opportunities in the existing business, the group continues to pursue earnings-enhancing strategic acquisitions which are synergistic, scalable, and fit with the company’s expertise.”
The company said that the “record summer trading period (was) boosted by pent-up demand and disposable incomes accrued during lockdown”.
And the Palace Pier itself had “delivered another consistent performance”. The pier has new tills and the company said that “new EPOS (electronic point of sale) technology” would “better capture customer data going forward”.
Total group revenue for the six months was up 178 per cent at £22.8 million, from £8.2 million a year earlier. It was also up 33 per cent on the same pre-covid period in 2019 (£17.3 million).
The Palace Pier contributed £9.2 million, more than any of the other divisions and up from £5.8 million a year earlier.
Profits, using a measure known as group EBITDA (earnings before interest, tax, depreciation and amortisation), rose to £7.9 million from £1.9 million.
The Palace Pier was the best performer, contributing £2.4 million.
Chief executive Anne Ackord, who went from running the pier to the wider business, said: “These excellent results show the popularity and cash generative nature of our diversified portfolio of entertainment businesses.
“The underlying trend for the first half is well above 2019 levels – a more meaningful comparison due to the pandemic.
“The period has also been boosted further by one-off VAT and rates benefits. These factors combined have resulted in the group trading ahead of market expectations.
“Looking forward, we expect the sales trends to continue, benefiting also from the opportunistic Lightwater Valley acquisition.
“We believe our asset-backed group is well placed to record an excellent result for the full-year and beyond.”
The company added: “These results demonstrate the underlying strength of the group’s diverse portfolio of assets and this positive trend is expected to continue through the seasonally quieter second half.
“The success of the vaccination programme and the relaxation of restrictions is expected to benefit the family leisure and entertainment sectors over the coming months as consumer confidence returns.
“Accelerating cost inflation across the UK is likely to translate into further cost increases over the coming months.
“While this is an unwelcome change to the business environment, the group believes it will be able to mitigate these inflationary cost pressures in the most part through targeted price increases and by operational improvements.
“Preparations at the Pier and at Lightwater Valley for Easter and the early summer trading periods are well advanced.
“‘Staycationing’ is expected to continue to benefit our businesses this summer as is the gradual increase of inbound tourism to the Pier as travellers return to the UK.”
