Ultimate Leisure, the Newcastle-based late-night operator, has reported a pre-tax profit of £2,000 for the six months to 31 December 2006, compared to £1.64m during the same period in the previous year.
Turnover increased by 4% to £18.2m compared to £17.5m in 2005, largely due to the benefits of new sites, while ebitda declined to £1.8m from £2.2m in the previous year.
The company said that the trading environment continued to be tough and affected by the after effects of the change in licensing laws, plus the historic lack of investment in its estate.
It also said it reflected the decline in sales in its un-invested core venues.
However, the company said that its reinvestment program was well under way and had led to a 1% increase in like-for-like sales in December.
The company said that trading since the year end has continued to improve due, with total company sales in the first five weeks of the new half year up 7.5%. Like-for-like sales climbed 2.3% during the period, with invested sites reporting a 6.3% rise in like-for-like sales.
It said that the recent growth in sales had been led by an improvement in food sales, which grew to nearly three times the level in the second half of 2005/06 overall, while like-for-like food sales grew by 89%.
The group said that it expected food to become increasingly important once the smoking bans in Northern Ireland and England come into affect.
It said that approximately two thirds of its estate has the possibility of a smoking area solution.
Mark Jones, chairman of Ultimate, said: “The half year saw us make progress in a trading environment that continued to be affected by considerable new competition in the late night market place following the change in licensing laws.
“The investment in our estate, our brands and our people has been at a heightened level in the period and this, increasingly, is putting us on a stronger competitive footing.
“With the investment programme nearly completed and sales improving we remain confident about the future prospects for the business”
The group invested in 10 businesses during the period, which were closed for extensive periods.
In total it invested £7.8m of which £5.5m was on acquisitions.
Ultimate disposed of two non-core nightclub sites in Rotherham and South Shields for book value. It acquired two premium bars in Belfast and the freehold of the Attic in Newcastle.
Since the turn of the year it has acquired the freehold of the Cotton Factory in Huddersfield.
It also opened its fifth site under its Prohibition brand in December, in the City of London.
Last month the group announced it is to raise £25m by way of a conditional issue of shares as it looks at a number of acquisition options.
