Photo-Me revenue to be 'slightly ahead' of expectations

Photo booth operator and service provider Photo-Me International said in an update on Friday that its better-than-expected trading momentum in May, June and July continued into its fourth quarter, driven by a continued recovery in photo booth activity and a “strong” performance in laundry.

The London-listed firm said that as a result, it expected revenue to be “slightly ahead” of previous expectations of £210m for the year ended 31 October, and profit before tax to come in towards the upper end of previous expectations of between £25m and £30m.

It reported a “continued “recovery” across most of its key markets, with continental Europe again performing strongly, particularly driven by a strong performance in France, while the UK returned to profitability, benefitting from the completion of its previously-announced restructuring.

“After a significant increase in activity in Japan in the first half due to the My Number card scheme, activity in this market would have returned to more normal levels had it not been for border closures due to Covid-19 restrictions, which resulted in a decrease in revenue in the region,” the board said in its statement.

“For similar reasons, the market remains challenging in China.

“Excluding Asia, the group is making good progress in returning to pre-pandemic performance levels in the last months.”

During the year, Photo-Me said it continued to deliver on its growth strategy, with the ongoing expansion of its ‘Revolution Laundry’ operations, and extensions to its food business through the acquisition of a manufacturer of pizza vending machines.

In addition, the group extended its geographic footprint, taking the first commercial steps into Finland and, via a small vending acquisition, Australia.

“The rollout of the group's new corporate brand strategy, ME Group, continues to strengthen its brand position and better reflects the significant diversification of its operations in recent years.”

At year-end on 31 October, the company had a net cash balance of £33.8m, net of acquisitions during the year which totalled £10.8m, while its gross debt stood at £65.9m.

“The group has continued to perform strongly over recent months, despite ongoing macroeconomic challenges,” the board said.

“Most of its key markets have recovered well and business activity is returning to pre-pandemic levels.

“The board remains cautious of the macro-economic challenges, which include rising inflationary cost pressures due to the widely reported issues across the supply chain and the ongoing pandemic.”

Photo-Me said it would publish its results for the 12 months ended 31 October on 23 February.

At 1422 GMT, shares in Photo-Me International were up 7.28% at 62.22p.