Securing forward sales and multi-year contracts provides us with significant confidence of the short and medium term growth strategy and, together with other revenue streams, our ability to deliver shareholder value
David Ciclitira, executive chairman
What Live Company does
These range from large BRICKLIVE events that attract hundreds, to smaller cafes that parents and children can enjoy while taking a break from shopping.
Since listing on AIM in December 2017, the Company has been pursuing an aggressive strategy of expansion and brand building that has paid off for the share price.
What it owns
Brick Live Group holds BRICKLIVE, an interactive event that allows people to learn, build and play with LEGO bricks.
Parallel Live is a joint venture with Three Six Zero to hold BRICKLIVE events in the US and Canada. The joint venture has agreed terms with Live Nation Entertainment to launch events this year. The first was held in Dallas in January.
Bright Bricks, acquired by Live Company last October, is a professional LEGO brick building firm. It makes custom LEGO brick and toy brick creations for clients across the globe including Rolls-Royce, Google, BT, Land Rover, Warner Brothers, LEGO, General Electric, The National Gallery, Maersk and Lufthansa.
How it is doing
Live Company said this year's profits will be “heavily weighted” to the second half.
In November, it expanded its five-year agreement with children’s entertainment group Nickelodeon to hold themed BRICKLIVE events across more countries following successful tours in the UK.
The AIM-listed firm will produce and exhibit BRICKLIVE tours themed around Nickelodeon shows and characters in all countries except the US until the end of 2024.
The BRICKLIVE Super Series of events, held across Europe from mid-September to early November, attracted nearly 85,000 visitors over the six shows, for a total of 70 shows over the full year.
In the six months to 30 June, the AIM-listed firm made an expected £1mln loss as opposed to £520,000 profit the year prior, due to costs related to the integration of Bright Bricks.
The latter was acquired in October 2018 for £8.5mln and has secured the entertainment group’s brick supply and increased its competitive advantage, meanwhile raising barriers to entry for other firms in brick-based entertainment. Live Company is in talks with the sellers to defer the consideration of the acquisition.
Sales dipped below £2mln from £2.8mln in the first six months of 2018, which Live Company said was because of an “unusually high” sale last year of Animal Paradise in China, which totalled US$800,000.
• In January, the firm signed a licence agreement with Entertainment One to produce BRICKLIVE tours themed around characters from the Peppa Pig cartoon franchise
• The company will hold its first BRICKLIVE show in Canada from June to November 2020 at the Societe Zoologique de Granby Zoo in Quebec
• In December 2019, the firm concluded new loan agreements with existing investors to boost its build programme for 2020
• In 2020 it will organise its first BRICKLIVE show in South Africa, following a joint venture deal with event organiser WORLDSPORT
• In August, the media group signed a deal with entertainment firm Imagine Exhibitions Inc to help expand its BRICKLIVE tours in North America for a five-year term
• The company has signed with an arm of France’s largest exhibitors and venue operators, GL Events, for staging and promotion of its first BRICKLIVE show in France at the Parcs Des Expositions in Toulouse, to be held between 19 and 27 October
What the broker says
In a note in June, analysts at Shard Capital forecast that Live Company would deliver an underlying pre-tax profit of £200,000 in its current financial year, which would then rise to £1.7mln in 2020 and £3.6mln in 2021.
Analysts also said that the deal Nickelodeon was “transformational” for the Company and would allow it to benefit commercially from leasing assets built using Nickelodeon’s intellectual properties (IPs) while also potentially opening the door to more IP deals with other major content partners.
Shard added that the market fundamentals for the group’s BRICKLIVE shows were “strong” with leisure spending showing historic long-term growth in addition to higher levels of disposable income from emerging economies which was fuelling the wider travel and leisure sectors.
Shard’s valuation has given a one-year range for Live Company of between 73p and 89p per share, which suggested “limited downside risk” alongside strong potential to outperform as newsflow underpinned its longer-term growth prospects.
The company is planning to increase its presence in the southern hemisphere to maximise the use of assets during the European winter months.
Following the shows in Toulouse, France with GL Events, Ciclitira says that the company hopes to sign a longer partnership agreement to extend its presence in the country.
The entertainment group has also signed a three-year deal to tour in South Korea, first with its 'Mythical Beasts' exhibition running until August 2020, and raking in US$300,000 a year.
In September its subsidiary Brick Live International signed a deal with Snowman Enterprises to run a themed 'The Snowman and The Snowdog' tour across the UK and Ireland until January 2022.