XP Factory significant growth in scale, with group revenue of £8.1m

XP Factory plc (LON:XPF), a global leader in the experiential leisure sector, has announced its unaudited interim results for the six months ended 30 June 2022.

Half year ended 30 June 2022 (£’000)Half year ended 30 June 2021 (£’000)
Gross Profit5,096801
Adjusted EBITDA profit / (loss)1,070(796)
Loss per share (pence)(2.20)(2.81)


·     Group revenue of £8.1m (2021: £1.2m) demonstrates a significant growth in scale and includes:
–     Escape Hunt owner operated site revenue increased to £4.3m (2021: £0.9m)
–     Boom Battle Bar (“Boom”) revenue of £3.6m comprised £2.2 from owner operated sites and £1.4m from franchises
·     Group Adjusted EBITDA1 profit of £1.1m (H1 2021: loss £0.8m)
·     Site level EBITDA profit of £3.1m (H1 2021: profit £0.4m)
·     Group Operating loss of £2.4m (H1 2021: loss £2.2m)
·     Loss per share of 2.2p (H1 2021: loss of 2.81p)
·     Cash at 30 June 2022 of £5.2m (30 June 2021: £2.4m)


·     Significant progress made in establishing the UK owner operated network both for Escape Hunt and Boom
·     17 UK Boom sites open at 30 June 2022 – 4 owner operated and 13 franchised 
·     19 owner-operated Escape Hunt sites open at 30 June 2022
·     Pipeline of additional new sites well established for both businesses
·     Escape Hunt exceeded its pre IFRS 16 target site level EBITDA margin (39% vs 30%)
·     Boom Battle Bar owner operated sites already beginning to demonstrate their ability to achieve mature target EBITDA margins


·     Escape Hunt and Boom currently performing well with pleasing level of sales being achieved
·     Continuing growth in the returns being achieved across the Boom owner operated sites
·     Acquisition of the former Boom franchise site in Cardiff completed on 8 September 2022
·     Acquisition of the former Boom franchise site in Norwich completed on 16 August 2022
·     Further owner operated Boom sites opened in September 2022 in Edinburgh and Plymouth and an additional Boom franchise sites opened in Sheffield in July 2022 and Chelmsford in September 2022 taking the total to 21 open sites, comprising 8 owner operated and 13 franchise sites
·     2 further owner operated Escape Hunt sites opened, in Norwich in August 2022 and Edinburgh in September 2022, taking the total to 21 owner operated sites
·     Additional owner operated Boom sites in build in London (Oxford Street), Leeds, and Birmingham
·     Further franchised Boom sites in build in Southampton and Bournemouth
·     Additional owner operated Escape Hunt sites in build in London (Oxford Street) and Bournemouth
·     All UK Escape Hunt owner operated sites operating for more than a year awarded ‘Traveller’s Choice Awards’ by Tripadvisor ™
·     Boom consumer ratings significantly outperforming peers and the industry

Recent performance across the estate has been encouraging with no discernible impact from consumer weakness. The Board remains focussed on providing the best possible customer experience to an ever growing number of customers across the UK and beyond and will keep a careful eye on consumer behaviour in the context of the macro-economic environment and be ready to react if there is any sign of an impact.

Notwithstanding the encouraging recent performance, the Group’s full year results are heavily weighted to the final quarter’s trading and will be influenced by, inter alia, the dates on which sites currently in build are able to open, how quickly the performance at those sites tracks through the maturity curve, and the strength of pre-Christmas trading generally.

Richard Harpham, Chief Executive of XP Factory, commented: “2022 represents an important year in our evolution as we continue to build the platform for a sustainable, cash generative and profitable experiential leisure business.

We have made significant progress towards our goals, growing the Boom estate to 21 sites today from only seven when we acquired it in November 2021.  We have also grown our Escape Hunt business to 21 owner operated sites today, with the brand continuing to perform well, generating strong returns at a site level.

With each successive week, Boom’s trading performance reinforces our belief that it is a very attractive proposition, capable of delivering strong margins and an exceedingly attractive return on capital.  We are delighted with the progress we have made and believe that by the end of the year, the foundations will be firmly set  for the business in 2023 and beyond.”

[1] Earnings before interest, tax, depreciation and amortization, calculated before pre-opening losses, exceptional items, and other non-cash items.  A full reconciliation to operating loss is provided below in the text of the announcement.



The first half of 2022 has been transformational.  In November 2021 we acquired Boom Battle Bar (“Boom”) and renamed the Group XP Factory plc, creating one of the UK’s pre-eminent experiential businesses, operating two fast growing bands, Escape Hunt™ and Boom Battle Bar™.  At the time of acquisition, Boom was a very young business, with just seven UK sites open; six of which were franchised and one of which was owner operated and all of which had less than twelve months’ operating history.

We set ambitious targets to grow the footprint alongside our existing Escape Hunt network.  Activity in the first half of the year has been focused on bringing the businesses together, executing on the ambitious site roll-out plans and investing in the operations of the new business. As at 30 June 2022, the Boom estate stood at 17 opened sites; four owner operated and 13 franchises.

We also extended our Escape Hunt estate, adding a site in Exeter, co-located with Boom, bringing the owner operated estate to 19.  Since 30 June 2022, we have further extended the estate, acquiring former Boom franchise sites in both Cardiff and Norwich, opening a further co-located owner-operated Boom and Escape Hunt site in Edinburgh, opening a new Escape Hunt site in Norwich, opening a new Boom owner operated site in Plymouth, and opening Boom franchise sites in Sheffield and Chelmsford. Several more sites are in build as set out below.

This activity has set the scene for a year which will deliver a group of significantly larger scale and capability compared to a year ago.  The objective for the year is to build the foundations of a network of Boom Battle Bar and Escape Hunt owner operated and franchise sites capable of delivering strong cashflows and a high return on capital for years to come.  Alongside the efforts to open new sites, we have also focused on building capability in our operational teams, who are now delivering the financial model we believed Boom could be capable of, whilst continuing to nurture Escape Hunt.  We are delighted to have made such significant progress towards these goals.

With such an aggressive rate of new site openings relative to the Group’s small size at the beginning of the year, it would be almost impossible to predict with total accuracy the specific week in which each new site would open. Whilst most of our owner operated builds have been delivered broadly in line with our expectations, there have been delays in the openings of certain owner-operated sites and in a number of the franchise sites, but nonetheless the Board remains confident that its target of 27 open sites for the year end will be achieved. We are of course acutely aware of the current pressures on consumer discretionary spend. As a high margin business we feel as confident as we can be that we can absorb the inflationary pressures and weather the storm by continuing to focus on providing an outstanding customer experience and value for money. Indeed we have been very encouraged by the resilience in trading in the weeks post 30 June 2022.  

Our full year outcome is skewed heavily towards performance in the second half of the year, notably the final quarter, and this is further amplified in the current year given the number of additional site opening that are still to come. However, we believe the results for the first half represent a solid performance which sets the business up well for the remainder of the year and beyond.


Much focus during the period has been on Boom Battle Bars; the expansion of the network in line with previously announced plans, both owner operated and franchised sites; the integration of the business into the Group; and development of the operational processes and teams to deliver on Boom’s potential.

Owner operated

We have made excellent progress towards our objectives.  At the start of the year, we had two owner operated sites open; one at Lakeside shopping centre in Essex and one in the O2 Arena.  The O2 site was opened shortly before Christmas, although we delayed the formal launch due to the spread of the Omicron virus and subsequent cancellation of all events at the O2 during January and most of February 2022.  Although open in the intervening period, the O2 Boom held its formal opening event in April 2022.  We also opened a new site co-located with Escape Hunt in Exeter in late April and our fourth site, located in Manchester, opened in late June 2022.  At the end of the period we had four owner operated sites open.

All four sites have shown encouraging performance in the months of operating, in line with an expected maturity curve typical for hospitality businesses.  We expect sites to run at a loss for a number of weeks as awareness grows and translates into revenue growth, whilst labour and other costs will start higher than the longer-term target and be brought down as the sites find their operating rhythm.  The owner operated estate delivered unaudited revenue of £2.2m in the six months to 30 June 2022 and a site EBITDA loss of £164k (£729k loss before IFRS16) reflecting the maturity curve of the new sites. Performance across the estate has shown the steady improvement we would expect, with target margins being achieved as the sites mature. We remain confident that the business model and returns profile for sites will be delivered, with target EBITDA margins in excess of 20% and a target cash return on capital of over 40%.

Our sites in central London (Oxford Street) and in Edinburgh have caused some frustrations. In both cases, planning and other landlord-related formalities have resulted in significant delays compared to our original plans.  We are pleased that our Edinburgh site recently opened on 23 September 2022, and we are now 7 weeks into the build at our site on Oxford Street, which is scheduled to open before Christmas. 

We are not immune to inflationary cost pressures, notably in energy prices. We also anticipate wage pressure as inflation filters through the system. The former represents a relatively low proportion of our costs whilst we are confident the latter can be managed through labour flexibility and, in future, by passing on an element of our increased costs through prices.  As a result, we have no reason to believe our expectation of the potential margins from our sites should change meaningfully.

Since 30 June 2022, we have commenced builds on four owner-operated sites, in London (Oxford Street), Birmingham, Plymouth and Leeds. Plymouth opened on 22 September 2022 and the others are all expected to open during Q4 2022.  We have also completed the acquisition of the former franchise sites in Cardiff and Norwich.  Together with the owner operated sites in Edinburgh and Plymouth that have since opened, these developments will take our owner operated estate to 11, well ahead of our previously announced objective of 7 by the end of 2022 and establishing a strong baseline for 2023.


The Boom franchise network was expanded significantly in the six months to 30 June 2022 with the addition of a further seven franchise sites.  As at 30 June 2022 there were 13 franchise sites open.  Two further franchise sites have since opened; the first in Sheffield opened in July, and a second in Chelmsford opened in September. Another two sites are currently in build in Bournemouth and Southampton.  A further site in Telford has been signed and several more sites are in advanced legals.  Whilst we factor in potential delays to franchise site openings, timing is not in our control.  On average, sites have been several months later to open than initially indicated.

Boom franchise activities delivered unaudited revenue of £1.4m and EBITDA of £0.9m in the six months ended 30 June 2022. 


Owner operated

The Escape Hunt owner operated estate generated unaudited revenue of £4.3m, representing a 361% increase on the £0.9m delivered in the same period in 2021, although all our UK venues and our venues in Paris and Brussels were closed for the majority of the comparable period in 2021.  Site level EBITDA rose to £2.1m from £0.2m. On a pre-IFRS16 basis, site level EBITDA was £1.7m (H1 2021: loss £46k), representing a margin of 39%, significantly ahead of our internal target of 30% EBITDA margin.  The margin outperformance was helped by the reduced VAT rate and business rates reduction applied between January and March 2022 and which ended on 1 April 2022.  Underlying EBITDA margins, excluding the VAT benefit, continue to track ahead of our internal target.

We have made further progress on the growth of the network and integration with Boom.  A new owner operated site, co-located with Boom Battle Bar opened in Exeter in late April 2022.  We opened a second owner-operated site in Norwich shortly after the period end in August 2022 and, after frustrating delays, opened a third co-located site in Edinburgh on 23 September 2022. Two further sites are in build in London (Oxford Street), co-located with Boom, and in Bournemouth, where our site is adjacent to a Boom franchise site, also in build.

The network today comprises 21 owner-operated sites and the completion of sites in Bournemouth and Oxford Street will take the total to 23. 


The franchise estate delivered unaudited revenue of £0.2m. The Australian network performed in line with the same period in 2021 and we have seen a recovery within the European network compared to the same period in 2021 during which many of the sites were closed.  This increase is offset by lower upfront and other fixed fees.

Some modest progress was made in the USA in late 2021. The franchise site in Houston, which is operated by our partners, Proprietary Capital Holdings, added two new generation games in December 2021 and is now set up as a reference site to demonstrate to potential franchise partners in North America. Performance in Houston has been tracking strongly in 2022. Franchise recruitment activity all but ceased during Covid and has been slow to re-start.   We expect to give greater attention to the US potential in 2023.


Financial performance

Unaudited group revenue in the six months to 30 June 2022 was £8.1m, an increase of 589% over the same period in 2021. The period to 30 June 2022 includes £3.6m of revenue from Boom owner-operated and franchise activities (2021: nil.. The increase also reflects that the majority of Escape Hunt venues were closed for much of the first half of 2021 due to Covid restrictions.

Site level EBITDA was £3.1m (2021: £0.4m), offset by central costs of £2.0m (2021: £1.2m).  As a result, Group Adjusted EBITDA was £.1.1m compared to a loss of £0.8m in H1 of 2021. 

Six months ended June 2022£’000Six months ended June 2021£’000
Adjusted EBITDA1,070(796)
Amortisation of intangibles(455)(216)
Rent credits recognised2525
Loss on disposal of tangible assets(156)(18)
Profit on closure/modification of leases105
Branch closure costs and other exceptional costs(288)(147)
Branch pre-opening costs(881)
Provision against loan to franchisee(21)
Foreign currency gains / (losses)44(6)
IFRS 9 provision for guarantee losses(57)
Share-based payment expense(34)(26)
Operating loss (2,368)(2,222)

Of the £881k of branch pre-opening costs, £52k related to Escape Hunt owner operated sites, £821k related to Boom Battle Bar owner operated sites, and £7k related to Boom Battle Bar franchise sites.  Pre-opening costs (whilst not all cash) include costs accrued before the site is opened to the public, such as rent and other property costs, staff recruitment and training costs. 

The branch closure costs and the loss on disposal of tangible assets relate to the closure of the Escape Hunt Edinburgh site and the final liquidation of Escape Hunt’s original subsidiaries in Malaysia and Thailand, for which the process has taken several years to complete.

Unaudited group operating loss was £2.4m (2021: £2.2m)


The Group generated £0.8m of cash from operations (2021: cash utilised of £0.1m).  £3.4m (net of capital contributions) was invested in plant and equipment and intangibles.  This comprised total investment of £3.4m offset by £0.8m of capital contributions for Boom owner-operated sites and £0.8m investment in Escape Hunt owner operated sites. 

Cash at 30 June 2022 was £5.2m (30 Jun 2021: £2.4m) and £3.7m as at 31 August 2022.

Financial position

The increase in property plant and equipment reflects the investment in owner operated sites outlined above, offset by depreciation.  The increase in right of use assets is matched by an increase in lease liabilities and relates to the IFRS 16 accounting for new owner operated sites signed during the six month period.  The finance lease receivable relates to the IFRS 16 accounting for a sub-let of the Bournemouth venue to a Boom Battle Bar franchisee as XP Factory holds the master lease. 

The largest movement in current assets related to the receipt of the £1.8m (net) R&D credit paid in January 2022.

Provisions of £9.9m includes deferred and contingent consideration relating to the acquisition of Boom Battle Bars in November 2021. £9.4m is the valuation of contingent consideration, inclusive of 13.7% p.a. notional interest rolled up from the date of acquisition, the payment of which depends on the achievement of certain turnover and site numbers from the Boom acquisition in the year to 31 December 2022.  Details of the contingent consideration are outlined in the Company’s Annual Report for the year to 31 December 2021.  The contingent consideration is payable by the issue of up to 25m XP Factory plc shares, valued at the date of acquisition at 35.8p.  The balance relates to a working capital and net debt adjustment for the Boom acquisition, provided for post acquisition.  

£340k of convertible loan notes issued in July 2020, together with £54k of rolled up interest were converted to equity on 2 February 2022 at 9.0p per share, resulting in the issue of 4.4m shares.  There were no convertible loan notes in issue at 30 June 2022.  £404k of vendor loan notes (£360k relating to the acquisition of Boom in November 2021 and £44k relating to the acquisition of the French master franchise in March 2021) remained outstanding at 30 June 2022. Other loans outstanding at 30 June 2022 totalling £755k relate to fit-out finance for Boom sites, of which £418k is offset by corresponding back-to-back receivable amounts.

Net assets as at 30 June 2022 stood at £18.8m (31 December 2021: £21.8m)


At the time of the acquisition of Boom Battle Bars in November 2021 we set out a four-point plan to increase shareholder value.  Progress has made in each of these medium-term objectives as set out above. Our objectives are to:

1.     Maximise the UK footprint by rolling out each brand, either through direct investment into owner operated sites or through franchise arrangements
2.     Accelerate growth in international territories, predominantly through franchise
3.     Continue to develop new products and markets which facilitate the growth of B2B sales
4.     Integrate the businesses, exploit synergies where possible and develop an infrastructure that supports scale and future growth

Details of our progress in growing the UK footprint and the integration of Boom have been described in some detail above. We have intentionally de-emphasised international expansion in the period as we focused on the intensive roll-out strategy in the UK. We expect to place greater emphasis on international opportunities once we have a period of profitable operating experience in the UK. Our efforts to build a greater B2B business are being rewarded, particularly within Boom.  Corporate sales represented approximately 6% of sales in the six months to 30 June 2022.  In the period since then, we have seen a marked increase in corporate sales, and in the period since 30 June 2022 corporate sales have grown to represent approximately 12% of sales.  We expect this to grow further in Q4 2022.


Trading since 30 June 2022 has continued positively.  In the 10 weeks to 12 September 2022 UK Escape Hunt owner-operated estate generated unaudited turnover of approximately £1.7m, an increase of 11% compared to the same ten-week period in 2021. Adjusting for the VAT benefit received in 2021, the underlying increase was 27%, reflecting an enlarged network and 8% like-for-like growth from sites which were open in the same period in 2021.  Escape Hunt site level EBITDA margins continue to exceed the Board’s internal benchmark of 30%.

The Boom owner operated sites delivered unaudited turnover of approximately £1.4m for the ten weeks to 12 September 2022 and each of the Group’s sites has proved capable of delivering margins in line with our expected box economics within the first few months of operating, underpinning confidence in the Group’s business model. Boom franchise royalties in the 10 weeks to 12 September 2022 totalled approximately £0.3m.

2 6 weeks with 4 sites open; 3.5 weeks with 5 sites open; and 0.5 weeks with 6 sites open.

This performance provides the Board with continued confidence for the future potential for the Group.

Recent performance across the estate has been encouraging with no discernible impact from consumer weakness. The Board remains focussed on providing the best possible customer experience to an ever growing number of customers across the UK and beyond. The Board will keep a careful eye on consumer behaviour in the context of the macro-economic environment and be ready to react if there is any sign of an impact.

Notwithstanding the recent performance, the Group’s full year results are heavily weighted to the final quarter’s trading and will be influenced by, inter alia, the dates on which sites currently in build are able to open and how quickly the performance at those sites tracks through the maturity curve, and the strength of pre Christmas trading generally

Richard Harpham 

Chief Executive Officer, XP Factory

27 September 2022

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