SHARES in five-a-side football pitch operator Goals Soccer Centres closed 21 per down yesterday after the business warned that it is continuing to feel the negative effects of adverse weather in the first quarter of the year.
In May the East Kilbride-based business said that heavy snowfall in February and March had led to a £500,000 shortfall in sales in the first three months of the year.
Yesterday, the AIM-listed business told the market that this had extended into the following three months, with first-half turnover dipping by 3% from £16.6 million to £16.1m.
Read more: Goals' shares plunge after snow hits sales
“As previously announced, Q1 2018 was impacted by the extreme weather conditions during March and April,” the announcement said.
“As a direct result of this, there has been a further substantial knock-on impact on trading throughout Q2 2018.
“This is due to amateur 11-a-side games deferred from Q1 to dates in Q2 when teams would normally be playing five-a-side.”
Despite chief executive Andy Anson saying that the business expects an improvement in the second half of the year, he admitted that full-year results would be “materially below market expectations”.
As a result the firm’s lender – Bank of Scotland – has agreed to alter the point at which it would call in its debt for a limited period.
Until now Goals, which in December 2017 had bank loans totalling £30.4m, would have breached its covenants when its net debt came to three times its earnings before interest, tax, depreciation and amortisation (EBITDA).
Read more: Goals chief hails deal with Manchester City owners
The bank has agreed to increase the net debt to EBITDA ratio to 3.25 times until the end of September, at which point it will reduce back down to three times.
The firm said the move would give it “additional headroom” when the bank carries out its quarterly tests on the debt in June and September.
The firm’s shares reacted negatively to the news, falling 30% to 60p in early-morning trading. They recovered some ground over the course of the day before closing at 68p, 21% lower than the previous day’s close of 86.5p.
Looking ahead to the rest of the year Mr Anson said that an ongoing programme that has seen it upgrade hundreds of pitches across its UK sites should help drive turnover growth.
In total, Goals has 460 pitches spread across its 46 UK clubs and it has so far modernised 260 of those.
The business is spending £3m upgrading a further 78 pitches, with the work due to complete in the autumn.
It also expects its nascent US business, which is currently made up of three clubs, to help enhance revenues. A fourth US club, which will be based in Los Angeles, is expected to open at the end of this year.
Meanwhile, the business, which launched 18 years ago, has announced that chief financial officer Bill Gow is leaving to join Thomas Tunnock, the teacake business that is run by his father-in law Boyd Tunnock.
Goals chairman Michael Bolingbroke said: “Bill was one of the founders of the business in 2000. On behalf of the board of directors and the company, I should like to express our sincere gratitude to Bill for his contribution to the business over the years and wish him well in his new role.”
Mr Gow has stood down as a director with immediate effect but will continue in the finance role until a successor is appointed.
This is the latest in a series of board room changes at the business, which installed Mr Anson as chief executive in April.
The former Manchester United and Walt Disney Company executive replaced Mark Jones in the role. Mr Jones moved on to become chief executive at restaurant chain Carluccio’s.
Read more: Goals Soccer Centres nets rise in revenue and sales after refurbishment
That move came after former chairman Nick Basing stood down from that position in February, with Mr Bolingbroke filling the post on an interim basis since then.
Mr Basing has remained at the firm as a non-executive director and has also taken on the chairmanship of the joint venture Goals formed with City Football Group, the owner of English Premier League club Manchester City.
City Football Group, which is driving Goals’ expansion in the US, invested $16m into the joint venture.
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