Milton Keynes-based nightclub operator Luminar Group is celebrating a return to profit 18 months after being acquired by a new management team.
The last 12 months especially has seen a period of what chiefs are calling “consolidation and investment to arrest the decline and develop a clear plan to rebuild the business”.
Luminar, based in Deltic Avenue, Rooksley, operates 53 nightclubs from Aberdeen to Bournemouth, employing some 2,500 people.
In the year to February 23, Luminar recorded profit before tax of £1.326million, on a turnover of £89.851million. In the period from December 5, 2011 to February 25, 2012, there was a loss before tax £976,000, associated with one-off costs of coming out of administration.
Luminar’s chief financial officer, Russell Margerrison said the business now has a “buzz and a bounce” adding: “This is an impressive set of results that demonstrates that the business is heading in the right direction.
“We have delivered strong financial progress, paid down our final deferred consideration payment ahead of schedule and are now in a position to continue to invest in our estate and our people to build a profitable future.”
The company, which says it is Europe’s largest nightclub operator, has no bank debts and a focus on the future.
As part of its business transformation plan, the company has an investment programme that will see 60 per cent of the estate invested in by the end of its 2014 financial year, with the the aim to complete the schedule by the 2015 financial year.
During the course of the period, the group invested £2.4m in refurbishing units in York, Edinburgh, Crawley, Aberdeen and Eastbourne, and on the acquisition of the lease on Casino nightclub in Guildford.
Additionally, a further £1.6m was spent on minor refurbishments, equipment upgrades and other improvements elsewhere in the estate.
Mr Margerrison said: “When we acquired the business, one of our key priorities was to refurbish the estate which had been under-invested for many years and the quality of the experience fell way below what our customers expected. We now have a robust plan in place that will touch the majority of the estate by the end of our next financial year, together with a longer term view of re-investing to keep our brands and venues up to date.”
Current trading to date remains in line with expectations, with the refurbishment programme delivering returns on investment of over 50 per cent.
The company recently signed a new supply contract with Matthew Clark and is investing heavily in developing its social media activity, key for interacting with its core customer profile.
Looking forward, the late night sector continues to face a number of challenges with additional tuition fees for students and high unemployment impacting the 18-24 age group market.
However, Luminar believes the actions taken to reposition the business and the plans the company has put in place to re-invest in its estate, leave it well positioned to make further progress this year. Mr Margerrison added that whilst the group has worked hard and made “solid progress” there is still a “lot more to do”.