Investment: Luminar rises on night life
Your support helps us to tell the story
From reproductive rights to climate change to Big Tech, The Independent is on the ground when the story is developing. Whether it's investigating the financials of Elon Musk's pro-Trump PAC or producing our latest documentary, 'The A Word', which shines a light on the American women fighting for reproductive rights, we know how important it is to parse out the facts from the messaging.
At such a critical moment in US history, we need reporters on the ground. Your donation allows us to keep sending journalists to speak to both sides of the story.
The Independent is trusted by Americans across the entire political spectrum. And unlike many other quality news outlets, we choose not to lock Americans out of our reporting and analysis with paywalls. We believe quality journalism should be available to everyone, paid for by those who can afford it.
Your support makes all the difference.IF A RECESSION is imminent, investors should be calling time on Luminar. Despite persistent worries of a downturn the bar and nightclub owner continues to expand its chain of Chicago Rock Cafes and open up new nightclubs. The spending spree will see Luminar splash out up to pounds 12m in the second half, with another pounds 20m scheduled for next year.
Chief executive Stephen Thomas sees no reason for holding back. In the first half, like-for-like trading in the cafes rose 2 per cent despite the effects of the World Cup. Targeting post-match revellers helped the nightclubs report a 7 per cent like-for-like increase. Profits in the six months to 31 August were up 82 per cent.
The second half has started well, and Luminar is still confident it can buck any downturn. Its cafes are aimed at under-25s living in smallish towns across the country where the night life is scarce or non-existent. By staying open until 1am, they attract the post-pub crowd. And by keeping prices cheap, they undercut local nightclubs - the average spend in the cafes is pounds 11 per head, while in the nightclubs it is just pounds 7.50.
With interest cover of 14 times, Luminar can afford to gear up its balance sheet. Acquisitions are a possibility to bring in new nightclub sites.
The shares - up 25p to 525p yesterday - now trade on a multiple of 11 times forecast 1999 earnings. Despite the economic worries, Luminar looks better prepared than most to carry on partying. Good value.
Join our commenting forum
Join thought-provoking conversations, follow other Independent readers and see their replies
Comments