Goals Soccer Centres Share Price (GOAL)

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Share Name Share Symbol Market Type Share ISIN Share Description
Goals Soccer Centres Plc LSE:GOAL London Ordinary Share GB00B0486M37 ORD 0.25P
  Price Change % Change Share Price Shares Traded Last Trade
  0.00 0.0% 27.20 0.00 01:00:00
Bid Price Offer Price High Price Low Price Open Price
0.00 0.00 0.00 0.00 0.00
Industry Sector Turnover (m) Profit (m) EPS - Basic PE Ratio Market Cap (m)
Travel & Leisure 33.06 8.16 9.30 2.9 20
Last Trade Time Trade Type Trade Size Trade Price Currency
- O 0 27.20 GBX
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Goals Soccer Centres (GOAL) Latest News

Goals Soccer Centres News

Date Time Source Headline
30/9/201909:58ALNCGoals Soccer Centres Shares Cancelled Amid Ongoing HMRC Talks On VAT
30/9/201907:36ALNCFAlliance News Flash Headline
30/9/201907:00UKREGAIM Cancellation - Goals Soccer Centres Plc
26/9/201912:00UKREGGoals Soccer Centres PLC Circular to shareholders re Rule 2.11
24/9/201917:08UKREGHarwood Capital LLP Form 8.3 - Goals Soccer Centres plc
24/9/201916:11UKREGJ O Hambro Capital Management Ld Form 8.3 - Goals Soccer Centres Plc
24/9/201914:43UKREGLombard Odier Asset Mgt (Eur) Ltd. Form 8.3 - Goals Soccer Centres..
24/9/201914:12UKREGLegal & General Investment Mgmnt Ld Form 8.3 - Goals Soccer Centres plc
24/9/201913:49UKREGSchroders PLC Form 8.3 - [Goals Soccer Centres plc]
24/9/201912:51UKREGAllianzGI-Global Equity Business Form 8.3 - Goals Soccer Centres PLC
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Date Time Title Posts
15/11/201907:40GOAL - looks set to double from here678
16/1/201410:20GOALS SOCCER CENTRE-
22/8/201215:00*** Goals Soccer Centres ***22
23/7/201210:08Goals Soccer Centres266
05/4/200617:34Fancy a 5 bagger by next May ?4

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DateSubject
06/8/2020
09:20		Goals Soccer Centres Daily Update: Goals Soccer Centres Plc is listed in the Travel & Leisure sector of the London Stock Exchange with ticker GOAL. The last closing price for Goals Soccer Centres was 27.20p.
Goals Soccer Centres Plc has a 4 week average price of 0p and a 12 week average price of 0p.
The 1 year high share price is 0p while the 1 year low share price is currently 0p.
There are currently 75,215,060 shares in issue and the average daily traded volume is 0 shares. The market capitalisation of Goals Soccer Centres Plc is £20,458,496.32.
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23/9/2019
11:04		tomboyb: https://uk.advfn.com/stock-market/london/goals-soccer-centres-GOAL/share-news/Sports-Direct-International-Plc-Possible-Cash-Offe/80775720 Sports Direct offers 5p per share offer-
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10/6/2019
06:23		lukmanpatel: Another troll by the username lsehotdealz haha, share price is stagnant and there’s talks of fundraise at 10p on that board lol desperation has lead to going round posting on different board to prevent share price from dropping, usually ud stay quiet and average down and accumulate if you see huge potential lmaoo he’s spamming all the boards
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22/3/2019
15:49		arthur_lame_stocks: I'm beginning to wonder whether Goal's problems aren't more serious than they're letting on. This is virtually priced to go bust now, yet stated NAV in the last set of results was a multiple of the share price. I can only imagine that there are going to be large write downs of the tangible assets when the accounts are announced, I notice that when they have sold underperforming sites they haven't got anything like book value for them so it makes me think that the book value simply doesn't represent the real value.
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19/3/2019
13:54		apollocreed1: I bought a large holding in IDE Group at 32p - share price is now 1.4p. Primarily based on a lying trading update that they expected to report great results, and a bit of director buying seduced me into thinking everything was fine. The lesson learnt is never to believe optimistic CEO or Chairmen's statements.
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14/3/2019
07:48		sunnybeachboy: The share price is sitting at an all time low. Anyone who is holding with a much higher average should be thinking of buying more to bring there average down.
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19/7/2018
08:42		eastbourne1982: Someone needs to put this out of it's misery and take it over, £1 would probably do it now. The share price was 85p - 90p only very recently so it's hardly an ambitious target.
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13/3/2018
18:38		arthur_lame_stocks: Jimmy I think that GOAL's problems of late stem from the fact that they underinvested in their sites and they became stale. They are now investing in upgrading them and hopefully once that process is over capital expenditure will return to more normal levels. Personally I was quite pleasantly surprised at today's results, they were better than I expected and I would have liked to have seen a better response from the share price. I don't think it would be easy to realise value from the property assets because as I understand it they are all on medium term leases and not freehold.
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12/9/2017
12:52		pugugly: 5 hours since post 478 = Share price down 10% - No other comments - Message received MINIMAL INTEREST in soccer at family play level - Could this offering be going the same way a 10 pin bowling, squash etc etc - A short term interest spike and then a fall away - If so could it be that GOAL has a broken business model ?? In other words Soccer is basiscally reverting to a spectator sport rather than participation??
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25/8/2012
20:34		malc999: This is from The Independent published 23.08.2012:- The match to take over Goals Soccer Centre, which had already dragged into extra time, yesterday ended in a shock defeat for the £73m bidder. To the surprise of analysts, shareholders in the company – which operates 43, five-a-side football centres in the UK as well as one in the US – failed to back an offer from Canadian pension fund the Ontario Teachers' Pension Plan. Goals' board had agreed to the approach from Ontario in July, but with it requiring 75 per cent of independent shareholders voting at yesterday's meeting to back the move, only 71.4 per cent did. The 80 shareholders – mainly institutions – who did vote between them hold 30.5m shares, just over 60 per cent of the total number of shares in issue. With the £73.1m offer worth 144p-a-share, shares in Aim-listed Goals slumped 20 per cent, or 29p, to 115.5p. The decision prompted surprise among analysts, with those at the broker Panmure Gordon saying they "cannot remember a similar instance where shareholders have voted down a firm bid with no alternative offer and the obvious immediate share price downside". The bid process has been running since early April with four extensions granted by the Takeover Panel. Goals' rival, Powerleague owner Patron, did look at making a bid for the company, but dropped out earlier this month. "Obviously we are disappointed that we have not struck a deal", said Goals' managing director Keith Rog-ers, who holds an 8 per cent stake in the company. "However, to have a significant percentage of shareholders believing that our company is worth considerably more is testament to the great business we have built. "We are totally focused on our stated strategy to continue to build on the considerable success that has already been achieved," he added. The match to take over Goals Soccer Centre, which had already dragged into extra time, yesterday ended in a shock defeat for the £73m bidder. To the surprise of analysts, shareholders in the company – which operates 43, five-a-side football centres in the UK as well as one in the US – failed to back an offer from Canadian pension fund the Ontario Teachers' Pension Plan. Goals' board had agreed to the approach from Ontario in July, but with it requiring 75 per cent of independent shareholders voting at yesterday's meeting to back the move, only 71.4 per cent did. The 80 shareholders – mainly institutions – who did vote between them hold 30.5m shares, just over 60 per cent of the total number of shares in issue. With the £73.1m offer worth 144p-a-share, shares in Aim-listed Goals slumped 20 per cent, or 29p, to 115.5p. The decision prompted surprise among analysts, with those at the broker Panmure Gordon saying they "cannot remember a similar instance where shareholders have voted down a firm bid with no alternative offer and the obvious immediate share price downside". The bid process has been running since early April with four extensions granted by the Takeover Panel. Goals' rival, Powerleague owner Patron, did look at making a bid for the company, but dropped out earlier this month. "Obviously we are disappointed that we have not struck a deal", said Goals' managing director Keith Rog-ers, who holds an 8 per cent stake in the company. "However, to have a significant percentage of shareholders believing that our company is worth considerably more is testament to the great business we have built. "We are totally focused on our stated strategy to continue to build on the considerable success that has already been achieved," he added. ....and this is from the The Herald published on the same date:- Around £14m was wiped off the market capitalisation of the five-a-side football business yesterday after the 144 pence per share offer from the Ontario Teachers' Pension Plan (OTPP) was rejected. A total of 61 independent shareholders, controlling more than 21.7 million shares, approved the deal giving it 71.4% support, which was just short of the 75% threshold required. Panmure Gordon analyst Simon French said: "We cannot remember a similar instance where shareholders voted down a firm bid with no alternative offer and the obvious immediate share price down side." Goals management, including chief executive Keith Rogers, had recommended the deal while significant shareholders, such as Henderson Global Investors and Aviva Investors Global Services, had indicated their support. If the deal was approved, Mr Rogers would have seen his basic pay increase 47% from £160,690 to £235,690, with other executives also in line for pay rises. The management stood to net around £9.3m from the sale of their shares. However, they had agreed to use £6m of the potential proceeds to invest in the equity of the company formed for the purpose of the bid, called Goliath Bidco, with the remaining £3.3m being paid in cash. Goals operates 43 centres in the UK and one in Los Angeles in the United States. Further North American sites were understood to be one option being considered for growth. Yesterday, East Kilbride-based Goals confirmed it was not in discussions with any other party regarding a takeover. Patron Capital, which owns small-sided football operator Powerleague, has previously expressed an interest in Goals. Under takeover rules OTTP, one of Canada's largest pension funds, would need special permission to make a further bid for Goals within the next 12 months. A spokesman for Goals suggested those voting against the deal may have felt the company was worth more. The share price peaked at more than 440p in 2007 but plunged to less than 90p near the end of 2011. Sir Rodney Walker, non-executive chairman of Goals, said the management would "continue to focus on delivering the Group's strategy of delivering a best-in-class 5-a-side football experience to customers in the UK and beyond". The shares were down 29p at 115.5p, giving the company a market capitalisation of around £56m.
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10/7/2008
08:53		digitalinvestor: Recent reaearch note from Panmure Gordon below (Dated May 2008), talk about a GREAT story!!! GOALS SOCCER CENTRES Strong growth prospects BUY PANMURE GORDON (UK) LIMITED Goals Soccer Centres has performed well since its flotation on AIM in 2004, generating strong LFL sales growth. A clear strategy and resilience during previous economic downturns should help the company continue to grow over the medium term. We initiate coverage with a Buy recommendation and a target price of 350p. ! Strong growth. Following average LFL sales growth of 8% over the past four years, we believe our forecast of annual LFL sales growth of 5% going forward is achievable in a defensive market with only one major competitor. We believe that organic expansion should add a further 17–22% to the top line per annum over the next three years, while operational gearing should ensure margin expansion. ! Good prospects. We believe that the market for 5-a-side football should be recession resilient. This is due mainly to the low spend per head and the fact that it is a team sport. In addition, Goals has the industry’s most experienced management team and consistent business model. ! Initiating coverage with a Buy recommendation. Goals is trading at a substantial premium to its main competitor, Powerleague. However, its operating ratios and returns are far superior and we believe Goals is better placed to grasp the market opportunity. Market growth, greater customer penetration, strong EPS growth and a rising return on capital should drive further share price outperformance. Price 289p Price Target 350p Market Cap £121m INVESTMENT CASE Strong, consistent performance illustrates the substantial progress Goals Soccer Centres has made since flotation. We expect EPS growth of 120.3% over the next three years, believing the company will leverage its position as the UK’s leader in 5-a-side football centres. ! Strong market position. Goals is a clear leader in the 5-a-side football centres market. It has quality sites in a defensive market, with only one major competitor. ! Recession resilience. We believe that 5-a-side football should be relatively unaffected in a consumer downturn, because of the low spend per head and that – as a team sport – there is peer pressure to participate. These factors should support Goals and help to combat the indirect competition posed by other leisure activities (eg 11-a-side football), health clubs and gyms. ! The management team has solid experience, having been in the business since 5-a-side football progressed from being played in community sports halls. Managing director Keith Rogers co-founded Anchor International, which opened the first 5-a-side football centre in 1987. He oversaw the growth to 11 centres, before selling the company to 3i. Together with finance director Bill Gow, he completed the MBI of Goals in 2000 and its flotation in 2004. ! International opportunities. Now embedded in the UK and with a good pipeline, the company is looking at opportunities in the US and South Africa. Potential risks are minimised as South Africa would be a master franchise requiring no capital commitment from Goals. The US opportunity would be a JV (60% Goals, 40% local partner) and one trial site is likely to be developed first. ! Quality of sites. This is indicated by the income generation and profitability of the units, which we believe is largely determined by management as well as the site’s size, location and standards. Goals has a consistent and robust business model. It aims to spend £2.1m building each new site and an average of £30k on pitch maintenance per unit per annum. Goals spends £20k to update a pitch surface, while Powerleague (its main competitor) spends £15k. Finally, Goals spends an average of £20k per unit on repairs and renewals each year; Powerleague spends £14.5k. Given the superior profitability, overall Goals appears to have sites of a higher quality than Powerleague. Goals is achieving higher returns from its capital expenditure, as evidenced by its ROIC of 12.1% versus Powerleague’s 10.4%. ! Pipeline. Goals’ pipeline is a robust 40 sites, compared with the 28 sites currently in operation. It believes that there is scope for 150–200 football centres in the UK, of which it expects to take half. ! Valuation. We forecast annual LFL sales growth of 5% going forward and consistent organic growth. This leads to EPS growth of 120.3% between 2007A and 2010E. Supported by a DCF valuation of 364p, we initiate coverage with a Buy recommendation and a 350p target price. CATALYSTS ! Continued robust sales performance. ! Overseas expansion in the medium term. ! Potential for upgrades after September’s interim results. Recession resilience Experienced management team Quality of sites Goals Soccer Centres • Investment Case • Catalysts • Risks 5 June 2008 3 RISKS Goals Soccer Centres faces minimal regulatory risk. This, as well as strong demand, should enable the company to grow even in a consumer downturn in our opinion. We believe there is limited supply risk, as this is a niche industry with two dominant operators. CONSUMER DOWNTURN There is a risk of a further consumer downturn. If this occurs, UK households could be prone to trading down and reducing discretionary expenditure. This may be expected to have a negative impact on Goals, but we doubt the company would be as affected as the rest of the consumer sector. Management confirmed that the industry was not adversely impacted during the last recession, but this is only anecdotal evidence, and Goals claims that the low spend per head (£5.50) and the fact that it is a team sport and an habitual activity make it resilient. COMPETITION Goals competes with other 5-a-side football centres and leagues such as Powerleague (with 43 centres compared to Goals’ 28), the privately owned Sports and Leisure Group (seven centres), as well as leagues in non 5-a-side football centres (eg sports halls). However, we believe Goals’ superior product should allow it to remain a winner. Goals competes with other sports and leisure activities (eg 11-a-side football), leisure centres and gyms. However, 5-a-side is the fastest growing form of football according to the FA (source Goals/BRMB on behalf of the FA) and people can visit gyms and play 5-a-side football also. In fact, participating in one sport/fitness activity could even encourage people to participate in several. PIPELINE It is not always straightforward to maintain a robust site pipeline due to the physical nature of the sites. Gaining planning permission can be a lengthy process, and the sites take five months to build. Goals has a specific business model and the types of sites it is looking for may be less easy to find. The centres need to pay back within four years and achieve average annual EBITDA of £500k (the initial capital outlay averages £2.1m), which requires 225 games to be played a week. To generate this level of activity, the centres must: 1) have at least ten pitches; and 2) be within a 12–15-minute drive of a town/city with a population of 150,000+. The sites require space for car parking, although school sites often benefit from the fact that parking exists already. Goals has 40 sites in its pipeline at various stages, so, if six sites were opened each year, it would have 6–7 years of openings. Therefore, although its criteria may be difficult to meet, it appears as though it can deliver on the organic growth promised. Goals believes that there are 150–200 sites available for development in the UK, of which it hopes to eventually have 50%. WEATHER As all sites are outdoors, there is a risk that business could be badly affected by poor weather. Teams could switch to centres with indoor pitches or not play at all. However, teams tend to be locked in to a league or a block booking. According to management, history shows that players are rarely deterred by bad weather. Also, indoor sites often become uncomfortably hot in the summer unless they have air conditioning. 5-a-side is the fastest growing form of football according to the FA Robust business model Bad weather is not a deterrent to play Goals Soccer Centres • Investment Case • Catalysts • Risks 5 June 2008 4 OUR CENTRAL CASE Goals Soccer Centres is a profitable business that we believe should continue to generate strong returns and growth over the long term. Expansion should provide a robust platform to extend its competitive advantage and market share. PORTFOLIO Goals has 28 high-quality units, with an average of 11 pitches – ranging from eight to 18 – using the latest pitch surfaces. They are used mainly for 5-a-side football, but there are 7-a-side football pitches too. The sites are located around the country from Glasgow to Plymouth, Bristol to Dartford. The company has been listed on AIM since 2004, and management has solid industry experience. The company’s strategy is clear, focusing on the ‘Next Generation’ concept, which includes the following: ! Unrivalled locations; ! Unmatched quality and facilities; ! Exceptional service; ! All sites to be FA accredited; ! Using the latest technology; and ! Being a strong, exciting brand to reflect the passion of football. Achieving these objectives should ensure customer satisfaction and its becoming the operator of choice. ECONOMIC RATIONALE On average, Goals’ leasehold sites pay back within 4–5 years. There is only one freehold site, and it is highly unlikely that any new sites will be freehold. MARKET SUPPLY We believe that supply in the 5-a-side football market is relatively undeveloped, with high barriers to entry. There are two main areas of supply: 1) purpose-built 5-a-side football centres. Goals’ main competitor is Powerleague, which has 43 centres and is also quoted on AIM. The only other larger multiple operator is Sports and Leisure Group, a private company with seven sites; and 2) leisure centres and individual events companies organising 5-a-side football leagues in non-purpose-built sites such as sports halls. Goals also faces competition from non 5-a-side football competitors. In a tough economic environment, consumers could choose to participate in other activities, including 11-a-side football, or attend gyms/health clubs. MARKET DEMAND 5-a-side has strong competitive advantage over other fitness activities 5-a-side is the fastest growing type of football (source Goals/BRMB on behalf of the FA) and is outperforming 11-a-side. There is demand from people who want to play regularly for fun, without the commitment or skill required for the full version of the game. Also, 5-a-side can be organised more easily than 11-aside, for which players generally need to belong to a club. Furthermore, 11-a-side is played more often at the weekends and requires greater time commitment than 5-a-side (90 versus 40 minutes), which can be played more easily during the week – especially when family commitments might take priority at the weekend. Clear, focused strategy Superior returns Undeveloped market Goals Soccer Centres • Our Central Case 5 June 2008 6 Visiting gyms and health clubs can be a more solitary, less sociable activity. 5-aside football attracts people who want to play more from a social point of view with friends/colleagues/team-mates as well as those who want to keep fit. There are some people who are averse to joining gyms/health clubs and so may prefer this type of activity. Gyms and health clubs normally require fixed-term contracts, upfront membership fees and monthly subscriptions. However, in 5-a-side football, players in a league or block-booked session are generally committed to a maximum of three months. They can also play on a casual basis. This may encourage people to choose this form of exercise over the gym, especially if they are concerned about the economic climate and tightening household budgets. With 5-a-side football centre games, players pay for a session only if they attend. A gym monthly subscription of £50 is more expensive than playing 5-a-side football once a week. It may be cheaper per session if someone goes several times a week, but in total on a monthly basis it can be more expensive. Playing 5- a-side football may be viewed as better value. Finally, as the business models for 11-a-side football or health clubs are very different from that for 5-a-side football, they may not be competing for the same business. Participating in other sports/fitness activities could encourage people to play 5-a-side football as well. Purpose-built versus non-purpose-built 5-a-side facilities Purpose-built football centres are much more suitable for playing 5-a-side and clearly superior to playing on non-purpose-built pitches in leisure centres. For instance, there are separate pitches as opposed to sections of sports halls, so it is easier to play. All of Goals’ football centres are affiliated to the FA. This is not always the case with non-purpose-built centres, so Goals is more likely to be the operator of choice in our view. As purpose-built football centres become more widespread, it is likely to become more of the norm to use them as opposed to non-purpose-built pitches. Goals’ 5-a-side versus other purpose-built 5-a-side football centres People who play in Goals’ football centres are predominantly: 1) males aged 17– 40; and 2) the under 16s during the school holidays and at children’s parties. This is likely to be the same as at Powerleague. 5-a-side football – an alternative to other sports and fitness activities Goals has well-maintained units and the policy is to refurbish them every seven years, whereas Powerleague refurbishes every ten years. Goals’ centres are built to create a suitable environment for customers, including children and women. There are lounges with plasma screens and most have children’s party rooms. Goals and Powerleague have different business models. Goals has a set criteria for sites and plans to open sites within a 12–15-minute drive of towns/cities with a population of at least 150,000. Powerleague appears to be more flexible on location; however, given its inferior returns, we do not regard this as a positive. Goals tends to invest more in the initial build and general upkeep. It spends on average £2.1m on new sites, £20k per pitch when they are replaced every seven years, and £20k on repairs and maintenance per annum. Powerleague’s figures are £1.6m, £15k and £14.5k, respectively. Goals’ level of investment is likely to be a major factor behind its superior profits. RESILIENCE TO DOWNTURN We believe that Goals should prove to be resilient in a downturn/recession. We forecast LFL sales growth of 5% per annum: volume 1.5–2%-points and price 3–3.5%-points. We do not expect a weakening of booking levels, for the following reasons: ! The average spend per head per game (pitch only) is a low £5.50, and this is usually a weekly spend. We believe this is unlikely to impact household disposable income hugely compared to health club subscriptions, for example. Participation is therefore likely to be considered affordable, making cash flow relatively predictable. ! There is peer pressure to play football, as in all team sports. Players are committed because they do not want to let their team-mates down by dropping out, as the rest of the team might not be able to play if they do not find replacements. ! Playing 5-a-side football in a downturn could be a cheaper social event than visiting the pub – playing 5-a-side football and having a drink afterwards in the centre could be cheaper than a whole night out drinking in a pub with friends. SUPPLY Pipeline Goals’ football centres are typically good-quality sites on land owned by schools or local authorities, and they are sometimes on restricted sites such as Greenbelt or Metro land. The points to consider here are: ! Local authority or school sites are normally cheaper than commercial sites. For instance, the five JJB Soccer Dome sites acquired by Powerleague cost £17.4m, or an average of £3.48m. The average build cost is lower for both Goals (£2.1m) and Powerleague (£1.6m), and the majority are likely to be non-commercial sites. Note that outdoor sites are normally cheaper than indoor sites. ! Goals’ average rent and rates are £50k and £20k per unit per annum, respectively. Compare this to Powerleague’s £30k and £20k before the Soccerdome acquisition and £66k and £38k after it. ! Of Goals’ sites, going forward, the company believes that 50% are likely to be in schools, 25% on local authority land, and 25% private. Although schools and local authority locations can be less expensive than commercial land, acquiring them can take longer. It can take up to two years to receive planning permission and then there is the approximate 5-month build time. Goals, however, has a strong site pipeline (40 units), and so is well placed for strong organic growth over the next three years in our view. Well-maintained units Relative immunity to downturn Goals Soccer Centres • Our Central Case 5 June 2008 8 PRICING According to management, prices have increased just ahead of inflation over the past few years. Overall, in 2007A football represented 75% of a football centre’s income, the bar 18% and other 7%. All areas saw YOY growth. Goals’ average spend per head per game is £5.50, while Powerleague’s is £5.00. However, the higher price does not appear to deter customers. REGULATION There is low regulatory risk. However, these points are worth considering: Local authorities and schools support activities promoting fitness and combating obesity. Therefore, businesses linked to such areas should be looked upon more favourably. We believe Goals is the highest-quality operator in terms of sites, management and reputation. Schools, for example, do not make their decisions for commercial reasons, but because they want a sports centre – with a solid reputation – on their land. The smoking ban has had a limited impact on Goals, while Powerleague states the opposite. Powerleague saw LFL non-pitch sales decline by 8% in H1 (July– December 2007) and said that much of this was a result of the smoking ban. Goals does not split out non-pitch sales, but its full-year LFL sales uplift for 2007 was 7% compared to Powerleague’s H1 2008 figure of 2%. IMPROVING QUALITY AND PACE OF EARNINGS Goals plans to open six sites in each of 2008 and 2009, and seven in 2010. This is supported by its pipeline and compares with five openings in 2006 and four in 2007. Achieving this target should enhance sales and earnings substantially given the 4–5-year payback and high operational gearing. Goals continues to launch initiatives to fill spare capacity during less busy times, including coaching sessions, attracting shift workers who do not work during the day, and using the pitches for other activities such as rugby. Goals is continually developing its information systems. This helps it to manage enquiries, reservations, member details and the plasma screens showing, for example, league game scores. ACCOUNTABILITY Strong management Chief executive Keith Rogers was there at the birth of the industry. In 1987 he jointly established Anchor International, which operated 5-a-side football centres. He sold it to private equity group 3i 12 years later. 3i also acquired a rival operation, Powerplay; the two were merged to form Powerleague, which is now Goals’ main competitor. Mr Rogers left to lead a management buy-in at a much smaller business. With financial backing, he acquired the company that would form Goals, repeated his success and floated it on AIM in December 2004. That was six months before Powerleague was floated. We believe Goals’ management is robust, highly experienced, and has the drive, skill and knowledge to take the business forward to become a global brand and the operator of choice. KPIs The KPIs are: 1) the number of games played; 2) secondary sales; and 3) the quality of the facilities and service. As part of this, the number of games each site needs to have each week to achieve a 4–5-year payback is analysed. Goals’ target is 225, but it does not announce how it is doing on this metric. Solid site pipeline Promoting health and fitness Limited impact of the smoking ban Opportunities to create value Goals Soccer Centres • Analysis of Forecasts 5 June 2008 9 ANALYSIS OF FORECASTS Goals has a strong organic growth programme and has consistently grown LFL sales and margins. LFL sales growth ranged from 7% to 9% between 2004 and 2007; we forecast 5% per annum for the next three years. KEY REVENUE DRIVERS ! Pitch occupancy. Pitch sales make up 75% of revenues. Management understands that it is important to drive high levels of pitch occupancy during peak times and is considering methods to drive off-peak occupancy too, eg children’s coaching, targeting shift workers during the day, and other activities. ! LFL sales. We forecast annual LFL sales growth of 5% for the next three years. Growth ranged from 7% to 9% between 2004 and 2007. Our 5% forecast might prove conservative, but we feel that it is prudent to assume a lower figure given the current economic climate. Of the 5%, we expect 3–3.5%-points to relate to price and 1.5–2%-points to volume. ! Pricing. Increases occur after the summer holidays (coinciding with the new football season) and management is confident that any price increases should not impact volume as they are built in to customers’ expectations. Management believes that it has strong brand loyalty, particularly in areas where it is well established, such as Birmingham. We believe this strong brand loyalty and LFL sales growth is underpinned by management’s focus on investment in its facilities, service and location. Source Company, Panmure Gordon ! Organic growth. We forecast six new units in each of 2008 and 2009, and seven in 2010. ! Overseas expansion. Goals is looking to expand in the US and South Africa. This is not included in our forecasts. REVENUES AND YEAR-END UNITS MARGINS Due to the operational gearing effect of organic growth on a relatively fixed cost base, we expect margins to improve from 42% in 2007A to 44% in 2008E, 44.7% in 2009E and 46.0% in 2010E. Wages. Management operates very high controls over these costs, with each department in each branch having a weekly budget that can be exceeded only with authorisation. All pay rates are controlled by head office. Rent. The majority of sites are leasehold and the terms of the leases are reviewed in line with RPI every five years. Central costs. These are c£1.5m per annum and we forecast them to increase by 5% each year. There are also additional costs of £100k that are likely to be required for new sites each year. This should cover the costs for additional regional managers and administration. PROFITABILITY AND DIVIDEND We forecast EPS to rise from 11.2p in 2007A to 14.9p in 2008E, growing overall by 120.3% from 2007A to 2010E. The policy is to grow dividends in line with EPS. We believe that the dividend cover of 7.8x in 2007A is likely to be maintained. CASH FLOW Strong organic growth can be self-financed with robust profits combined with focused capital expenditure. This means that we expect net debt to rise from £33.8m in 2008E to £38.3m in 2010E. Capital expenditure is approximately £2.1m per new site, which we forecast to rise by 2% annually. An average of £30k per unit is spent on maintenance each year, which we also expect to rise by 5% annually. We have also allowed £200k per annum for systems development. BALANCE SHEET The company has a revolving credit facility of £40m, which should enable it to continue its current planned expansion. With Goals being almost self-financing, we believe it has sufficient financial headroom to support planned expansion. VALUATION Goals operates in a defensive market that should prove robust in a consumer downturn. Its operating ratios are superior to Powerleague’s because of better quality sites; this leads us to believe that Goals has a strong competitive position that justifies its premium rating. Our Buy recommendation assumes that this rating at least holds over the medium term. P/E Our 350p target price equates to a 2008E P/E of 20.1x and EV/EBITDA of 12.2x. We believe the premium to Powerleague is justified for the following reasons: ! Forecast earnings growth of 120.3% over the next three years; ! A defensive market and only one major competitor; ! Superior product generating higher margins and returns; ! Defensive qualities; and ! A strong organic pipeline. FREE CASH FLOW We forecast that the free cash flow yield after maintenance capital increases from 4.8% in 2007A to 11.3% in 2010E. This is driven mainly by our expectation of strong sales growth and continual profitability. DCF Our 350p price target is supported by our DCF valuation of 364p, which is based on a WACC of 7.4% and terminal growth of 1.0%. Sensitivity analysis Terminal growth 0.0% 1.0% 2.0% 7.0% 342 397 473 WACC 7.4% 316 364 430 8.0% 278 315 366 8.5% 252 284 325 Source Panmure Gordon PEER GROUP VALUATION We are Buyers of Goals and prefer it to Powerleague. Goals has clear strategy, and good quality sites, including location, size and investment. The key points are: ! We forecast 2008E average sales per unit of £0.9m for Goals and £0.7m for Powerleague. We forecast EBITDA per unit of £0.47m and £0.25m, respectively. ! Goals’ average sales per pitch are superior to Powerleague’s; for 2008E we forecast £81k and £63k, respectively. Premium valuation High growth Goals Soccer Centres • Valuation 5 June 2008 13 ! Goals’ LFL performance has overtaken that of Powerleague, and we expect this to continue. ! Goals’ P/E of 20.1x (for 2008E) is forecast to reduce to 12.1x (for 2010E), while Powerleague’s moves from 16.5x to 11.2x in the same period. In our opinion, this illustrates Goals’ longer-term value. The same trend is seen with EV/EBITDA. This, combined with the points discussed earlier, makes Goals Soccer Centres a more attractive investment in our opinion. CONCLUSION Taking a long-term view, we initiate coverage with a Buy recommendation and a 350p target price. Due to Goals’ long-term growth prospects and potential for forecast upgrades, we expect the shares to at least hold their rating over the medium term, during which time the company should generate significant growth. Valuations and returns compared 2008E 2009E 2010E EBITDA (m) Goals 13.0 16.4 20.6 Powerleague 9.6 12.1 13.2 EPS (p) Goals 14.9 19.3 24.8 Powerleague 4.1 5.3 6.1 EV/ EBITDA (x) Goals 12.2 9.8 8.0 Powerleague 9.7 7.4 6.7 EV/ EBITDAR (x) Goals 12.5 10.3 8.6 Powerleague 10.4 8.6 8.0 P/E (x) Goals 20.1 15.5 12.1 Powerleague 16.5 12.9 11.2 Dividend yield (%) Goals (%) 0.7 0.9 1.1 Powerleague (%) 1.8 2.0 2.2 Sales per unit (£000) Goals 909 932 955 Powerleague 707 757 764 EBITDA per unit (£000) Goals 465 483 508 Powerleague 250 276 281 EBITDA margin (%) Goals (%) 51.2 51.9 53.1 Powerleague (%) 35.4 36.4 36.8 EBIT margin (%) Goals (%) 44.0 44.7 46.0 Powerleague (%) 25.4 26.4 26.8 ROIC (%) Goals (%) 13.0 13.6 14.5 Powerleague (%) 9.0 9.6 10.2 Gearing (%) Goals (%) 111.6 91.7 77.7 Powerleague (%) 170.2 135.5 115.8 Fixed charge cover (cash) (x) Goals 5 5 5 Powerleague 3 3 3 Source Panmure Gordon Goals Soccer Centres • The Numbers 5 June 2008 15
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