REG - XP Factory PLC - Completion of RCF Banking Facility

XP FactoryAnnouncement

09/10/2024 07:00

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RNS Number : 4395H  XP Factory PLC  09 October 2024

9 October 2024

XP Factory Plc

 

("XP Factory", the "Company" or the "Group")

 

Completion of RCF banking facility

 

XP Factory, one of the UK's pre-eminent experiential leisure businesses
operating the Escape Hunt(®) and Boom Battle Bar(®) brands, is pleased to
announce the completion of its new £10m revolving credit facility (RCF)
provided by Barclays Bank PLC.

The facility increases the Group's flexibility and capacity to grow both the
Escape Hunt and Boom estates, provides additional working capital headroom,
and will enable the Company to refinance an existing £1m debt facility at
significantly lower borrowing costs.  The facility has been secured on the
strength of the underlying cash generation in the business.

In the 15 months to 31 March 2024, XP Factory delivered £6.5m of free cash
flow after maintenance capex, representing an annualised yield of 24% based on
the Company's current market capitalisation of £21.9m.  Over and above this
strong organic cash generation, the RCF will allow the Group to more actively
manage and accelerate its expansion of the Boom Battle Bar and Escape Hunt
networks.

The results for the 15 months to 31 March 2024 illustrated the underlying cash
generation within the business:

                                                                        £m
 Pre IFRS 16 Group EBITDA:                                              6.3
 IFRS 16 Adjustments                                                    3.7
 Working capital and other non-cash movements                           1.1
 Net cash generated from operating activities per cashflow statement    11.1
 Rent payments (treated as interest and capital payments under IFRS16)  (3.1)
 Underlying cash generated from operating activities                    8.0
 Maintenance capex                                                      (1.1)
 Interest and finance costs                                             (0.4)
 Free cashflow available                                                6.5

 Market capitalisation at 12.5p per share                               21.9
 Annualised free cash yield                                             24%

 

The Group has £22.3m of carried forward tax losses which together with future
capital allowances from expansion in the estate provides significant future
benefits before corporation tax will become payable.

 

Historically, investments into new sites within the Boom and Escape Hunt
networks have generated returns on capital of 52% and 48% per annum
respectively.  The Group's strong free cash generation dynamics and high
returns on capital provided the basis for securing the RCF at an exciting
phase in its growth strategy.

Philip Richardson, Director of Hospitality & Leisure, UK Corporate
Banking, Barclays said "XP Factory are a great example of an innovative
business in the hospitality sector and we're proud to support them with
lending to continue their growth as they expand their business across the UK."

Richard Harpham, Chief Executive of XP Factory plc said "Securing this new RCF
represents an important milestone for the Group.  Not only is it a strong
endorsement of the progress made in the last few years, but it will
significantly enhance our ability and confidence to add further venues to our
two fast growing brands.  Our existing cash generation supports around 5-6
new site openings per annum.  Although there will not be any impact in the
current financial year, with the facility in place we have the ability to
increase the pace of roll out in 2025 and beyond whilst maintaining
conservative debt ratios. "

 

Enquiries:

 XP Factory Plc                                                          +44 (0) 20 7846 3322

 https://www.xpfactory.com/ (https://www.xpfactory.com/)

 Richard Harpham (Chief Executive Officer)

 Graham Bird (Chief Financial Officer)

 Kam Bansil (Investor Relations)

 Singer Capital Markets, NOMAD and Broker                                +44 (0) 20 7496 3000

 https://www.singercm.com (https://www.singercm.com)

 Peter Steel

 Alaina Wong

 James Todd

 IFC Advisory - Financial PR                                             +44 (0) 20 3934 6630

 https://www.investor-focus.co.uk/ (https://www.investor-focus.co.uk/)

 Graham Herring

 Florence Chandler

Notes to Editors:

About XP Factory plc

 

The XP Factory Group is one of the UK's pre-eminent experiential leisure
businesses which currently operates two fast growing leisure brands.  Escape
Hunt is a global leader in providing escape-the-room experiences delivered
through a network of owner-operated sites in the UK, an international network
of franchised outlets in five continents, and through digitally delivered
games which can be played remotely.

Boom Battle Bar is a fast-growing network of owner-operated and franchise
sites in the UK that combine competitive socialising activities with themed
cocktails, drinks and street food in a high energy, fun setting.  Activities
include a range of games such as augmented reality darts, Bavarian axe
throwing, 'crazier golf', shuffleboard and others.  The Group's products
enjoy premium customer ratings and cater for leisure or teambuilding, in small
groups or large, and are suitable for consumers, businesses and other
organisations. The Company has a strategy to expand the network in the UK and
internationally, creating high quality games and experiences delivered through
multiple formats and which can incorporate branded IP content.
(https://xpfactory.com/ (https://xpfactory.com/) )

 Facebook:   EscapeHuntUK       BoomBattleBar
 Twitter:    @EscapeHuntUK      @boombattlebar
 Instagram:  @escapehuntuk      @boombattlebar

 

About Barclays

Our vision is to be the UK-centred leader in global finance.  We are a
diversified bank with comprehensive UK consumer, corporate and wealth and
private banking franchises, a leading investment bank and a strong, specialist
US consumer bank.  Through these five divisions, we are working together for
a better financial future for our customers, clients and communities.

For further information about Barclays, please visit our website home.barclays

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