3rd Jun 2016 09:34
LONDON (Alliance News) - Goals Soccer Centres PLC on Friday said it has raised funds through a share placing to back its new strategic plans, including growing its core estate in the UK and expanding its international presence.
The 5-a-side soccer centre operator said it has conditionally raised GBP16.8 million through the placing of 16.8 million shares at 100.00 pence each. Shares in Goals were trading up 5.3% at 109.00 pence on Friday morning.
Goals said it will use the proceeds to fund its four new strategic priorities, which comprise: growing and improving the UK core estate, developing new capabilities to move ahead of competitors, expanding internationally, and unlocking asset potential.
In order to achieve the first priority of enhancing the UK estate, Goals will refurbish existing buildings to a new upgraded brand format, accelerate an arena modernisation programme, and introduce new innovative technology to enhance the customer experience.
GBP5.1 million will be invested in arena modernisation, with 25 centres to be modernised between July and October this year. Refurbishments will include replacing the playing surfaces with twin stripe 5G artificial turfs, while all new pitches will be installed with shockpads to help extend pitch life, alongside new LED floodlights.
Goals expects arena modernisation to result in a 30% return on earnings before interest, tax, depreciation and amortisation.
Meanwhile, GBP7.9 million will be invested in a clubhouse refurbishment programme, under which higher potential centres will be redesigned with new reception and changing areas, new signage to increase local penetration, upgraded cafe facilities, and utilisation of unused space. The new concept will be fully introduced at two pilot centres in the third quarter of Goals' financial year and then rolled out across the remainder of the estate over the next two years. Goals expects this to result in a a 15% return on Ebitda.
Goals said the second strategic priority of developing new capabilities will be achieved by developing value-added propositions aimed at underdeveloped growth segments, relaunching a quality offering for advanced booked customers, upgrading IT systems, and "refreshing and reinvigorating the operating environment".
The third strategic priority regarding international expansion will include opening a centre in Pomona, near Los Angeles, in the second half of 2016, investigating market potential in Asia, and exploring other regions for market entry through "capital efficient routes".
Goals will invest GBP2.6 million in its pilot centre in Pomona, which it expects to generate an Ebitda return of 20%. It also has a pipeline of four additional potential centres in the Los Angeles area, but is not committing to any of those until target returns from Pomona are meeting expectations.
Finally, in order to achieve the fourth strategic priority of unlocking asset potential, Goals said it will develop additional revenue-generating lines of business, explore development potential across the property estate, and "remain open to potential accretive, complementary business opportunities".
Goals said its strategic plan aims to strengthen the group's position in the market, improve the return on capital employed, and increase shareholder value.
It expects to achieve earnings per share growth, a "strong and secure" balance sheet with the net to Ebitda ratio managed below 2.5 times, and increased shareholder returns through an uplift in equity value and a return to paying dividends in 2017 when the balance sheet recovers.
Under the placing, Chairman Nick Basing will subscribe for 100,000 shares, his first purchase of shares in company, giving him a total holding of 0.1% of Goals' issued share capital, while new Chief Executive Mark Jones will subscribe for 50,000 shares, also his first purchase.
Finance Director William Gow will subscribe for 25,000 shares, taking his total holding to 1.1 million shares representing a 1.5% stake.
Non-Executive Director Scott Lloyd will subscribe for 40,000 shares, his first share purchase.
In addition, Harwood Capital LLP will subscribe for 3.7 million shares, giving it a total holding of 14 million shares representing an 18.6% stake. Goals Non-Executive Director Christopher Mills is a director at Harwood.
The Times newspaper reported that Sports Direct International PLC Founder Mike Ashley also is participating in the placing, but a Goals spokesperson said he was unable to comment on that report.
Goals added in its statement that like-for-like sales in the first 21 weeks of 2016 have been "marginally negative".
The details of Goals' strategic plan and fundraising came after it ended a long search for a new chief executive by appointing Mark Jones to the role last month after Co-Founder and Managing Director Keith Rogers moved to the US to head up the group's operations there.
Last week Goals appointed the chief executive officer of Italian football team Inter Milan SpA, Michael Bolingbroke, as a senior independent non-executive director.
By Karolina Kaminska; [email protected] @KarolinaAllNews
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