Immotion reports strong revenue, announces partnerships with US zoos
Immotion Group (IMMO ) announced Final Results for the year ended 31 December 2021 was a year of progress as its core Location Based Entertainment business made a strong recovery post Covid-19 lockdowns.
Financial and Operating Highlights
Revenue increased by 230% to £9.4m, up from £2.8m in the year prior while the group reported £0.9m in EBITDA profit, recovering from a loss of £1.7m in FY20.
2H21 turned out to be a period of both financial recovery and progress, particularly for the LBE business, the company wrote, and “at a much faster rate than anticipated, as sites reopened and confidence returned providing further opportunities to launch new sites at aquariums and zoos,” it noted.
Average weekly revenue per headset was £441 compared to £329 in 2020. said this recovery, combined with rising demand from partner locations, has forced it to review its operations, allocation of resources and how it best delivers maximum shareholder value.
Focus and Disposals
As a result, and following a period of consolidation, has now decided that its other two businesses, HBE and Uvisan, will be spun out of the company to allow external finance to be raised as required and “most importantly” to stop any further cash investment from the company.
Once spun out, will be fully focussed on LBE. The Board says it is confident that this model is ”highly cash generative and scalable”, and that it also has “massive further potential.” said preliminary discussions relating to a spin out have occurred for both divisions.
“It is our intention that future funding of both will, once a deal is complete, no longer be the responsibility of , thus allowing us to focus its cash resources on LBE,’ it explained.
Based on its current pipeline, the size of the addressable market and our established position, the Board of Directors said they believe has a very considerable growth opportunity.
Having developed a new ‘plug and play’ solution for zoos – a 16-seater containerised solution – is looking to trial several of these in 2022 with a view to scaling the model in 2023.
The Company believes that the combination of large purpose-built theatre solutions, including pre-show experiences, along with a modular solution will allow it to grow rapidly and profitably.
“We have a clear plan of where we want to take the business and it has now reached a stage in its development where we believe it can be scaled without a commensurate increase in operating costs. The LBE business is already profitable, and we expect a combination of a full year of normal trading conditions for our brought forward portfolio as well as new capacity and new sites coming on stream to drive strong growth in revenue and profitability in 2022,” the company explained.
Outlook
The Company said 2022 has already begun ‘in very promising fashion’ with 1Q revenues at £2.1m and LBE revenue tripling to £1.8m compared to £0.6m reported in the same period in 2020.
has also announced today it is at an advanced stage for the signing of its first zoo installation, with the contract expected to be finalised this week.
said it is also at “a very advanced stage” with another USA zoo regarding large theatre-style installations. It expects to confirm the new contracts within the next few weeks.
View from Vox
The last 24 months for Immotion have been nothing short of tumultuous and it is credit to the management team for navigating the Company through these unprecedented times for the industry.
As a results, shares in Immotion have been particularly volatile over the past 24 months with the shares currently recovering from 12 month lows of 4p.
The focus on Location Based Entertainment appears sound and any funds received from the disposals will clearly be used to fund the strategy to target larger opportunities including, but not limited to, zoos.
Whilst the sales cycles for larger installations is longer than that of a smaller installation, the Company said it remains confident the process it has implemented will pay ''dividends'' for shareholder.
Investors would do well to believe in management given their perseverance and capabilities displayed during lockdown.
Furthermore, 2022 has clearly got off to a great start with a very strong Easter trading period, providing the Board with considerable confidence in the business and its future prospects and we would expect positive newsflow to follow the summer season to push the shares higher from here.
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