XP Factory PLC
LSE:XPF
XP Factory PLC
XP Factory Plc engages in the provision and franchise of physical adventure games. The firm operates two leisure brands including Escape Hunt and Boom Battle Bar. Escape Hunt is a provider of escape the room experiences through a network of operated sites in the United Kingdom. Boom Battle Bar is an experiential leisure business offering competitive socializing activities combined with theatrical cocktails and street food. Its activities include a range of games such as augmented reality drats, Bavarian axe throwing, crazier golf, shuffleboard, electric table tennis, pool, beer pong, Karaoke, ice curling, hammerschlaggen, and arcades.
XP Factory Plc engages in the provision and franchise of physical adventure games. The firm operates two leisure brands including Escape Hunt and Boom Battle Bar. Escape Hunt is a provider of escape the room experiences through a network of operated sites in the United Kingdom. Boom Battle Bar is an experiential leisure business offering competitive socializing activities combined with theatrical cocktails and street food. Its activities include a range of games such as augmented reality drats, Bavarian axe throwing, crazier golf, shuffleboard, electric table tennis, pool, beer pong, Karaoke, ice curling, hammerschlaggen, and arcades.
Revenue Growth: XP Factory reported revenues up by 33% to nearly £25 million for the first half, with positive like-for-like sales in both Escape Hunt (3.5%) and Boom (4.5%) despite a tough leisure market.
Cash Generation: The group delivered £1.5 million of EBITDA and £2.1 million in free cash flow, highlighting strong cash generation exceeding EBITDA, driven by a negative working capital cycle and rent-free benefits.
Strategic Expansion: Management unveiled a plan to reach £90 million in revenue and 15% EBITDA margin over four years, with site expansion as the main growth driver, enabled by a new £10 million Barclays facility.
Operational Efficiencies: Gross margins were maintained despite a 9.8% increase in minimum wage last year, and head office cost savings of £1 million have been implemented.
Labor Cost Headwinds: The group expects minimum wage and national insurance changes to add 5–9.5% to site labor costs but believes this can be mitigated through efficiency improvements and limited price increases.
Boom & Escape Hunt Performance: Escape Hunt held a 42% EBITDA margin and strong site consistency; Boom’s profitability varies by site, with high returns in premium locations prioritized for future growth.
