Nightcap Regulatory News (NGHT)

4 August 2022

Nightcap plc

("Nightcap" or the "Company" or the "Group")

Year-end trading update

Nightcap (AIM: NGHT), the owner of The Cocktail Club, the Adventure Bar Group and the Barrio Familia group of bars, is delighted to announce that it finished its financial year ended 3 July 2022 with continued positive trading during the final 13 weeks of the year.

Trading update

The Group continued to trade well and in line with management expectations during the final 13 weeks of the financial year ended 3 July 2022. The Group ended the financial year with a 23.6% like for like* increase.

31 of the 34 Group's announced bars are now trading across London, Birmingham and the South West of the UK, with three additional larger format bars for Tonight Josephine in Bristol and Liverpool, and The Cocktail Club's flagship site in Birmingham, entering the final stages of fit out ready to be open for the important second quarter of the Group's 2023 financial year.

The continued planned deployment of CAPEX into new openings throughout the FY2022 financial year has resulted in weekly turnover steadily increasing quarter on quarter, with the Group now regularly achieving weekly revenue exceeding £1.0 million.

13 weeks ended 3 July 2022 ("Q4 FY2022")

Unaudited Group revenue was £10.8 million for Q4 FY2022, resulting in a 73.2% revenue increase compared to the same period in 2019 and a 29.0% like for like* increase compared to the same period in FY2019.

53 weeks ended 3 July 2022 ("FY2022")

Unaudited Group revenue was £35.9 million for FY2022 (£6 million for FY2021), resulting in a 55.1% revenue increase on a combined group of companies basis and a 23.6% like for like* increase.

Unaudited Group revenue by quarter for the four quarters of FY2022 were as follows:

Adjusted EBITDA

The Group expects adjusted EBITDA for FY2022 to be in line with current market expectations, despite challenges from restricted trade caused by Covid-19 over the important Christmas period and recent transport strikes.

Cash

The Company's cash position (including cash in transit) as at 3 July 2022 was £6.1 million. At the same date the Group had total bank debt of £5.5 million resulting in a net cash position of £0.6 million as at 3 July 2022. Less than £0.9 million of the Group's total bank debt is scheduled for repayment during FY2023.

Outlook

Trading has continued in line with management's expectations in July 2022. The Group has strengthened its focus on offering good times and good value to its resilient Millennial customer base and, backed by an unparalleled property pipeline, the Board is confident in its decision to continue to invest in growth during FY2023.

With the launch of the Nightcap Bar Academy (announced on 1 August 2022) the Group is continuing to focus on significant investment in its people throughout the organisation, with clear objectives to continue to improve recruitment and retention at all levels.

At the Group level margin conversion has been maintained in an environment with significant uncertainties surrounding inflation, cost of living and costs of energy, although the majority of the Group's spirits supply contracts and energy deals are fixed into 2023 and some into 2024.

Sarah Willingham, Chief Executive Officer of Nightcap, commented:

"We are absolutely delighted with these results. Nightcap is going from strength to strength and I am so proud of the business that we are building. Finishing the year with 31 sites, with a number of openings to follow and a significant new site pipeline is a great achievement. Despite recent transport strikes and significant Covid-19 interruptions during the important 2021 Christmas period we have managed to deliver against our expectations thanks to our wonderful teams and loyal customers.

"Strong growth delivered by exceptional people with a real desire to continue to build a leading business in the bar sector in the UK, is setting us up well for another year of significant growth as we continue to bring on board and open more new sites in prime locations across the country.

"We always thought we would have a short window to sign and open the best sites across the UK when we were admitted to AIM last year, but the challenging macro environment has resulted in more sites being available on very attractive terms and with a simple to replicate business model across four distinctive brands, all led by motivated and engaged managements teams, serving a customer base with continued high disposable income, we feel confident about the year ahead despite the economic pressures facing the UK today. 

"We are well placed to mitigate inflationary rises as we grow and increase our buying power and we will continue to throw the best parties offering exceptional quality and value, ensuring that our lovely customers can still enjoy their great nights out."

*Like-for-like revenue is same site revenue defined as revenue at only those venues that traded in the same week in both the current year and comparative reporting periods in FY2019 and FY2020 uninterrupted by Covid-19 lockdowns.

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