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Live Company Group PLC: DEEP DIVE
OVERVIEW

Live Company growing ahead of schedule as it clinches deals with world class brands

  • Runs entertainment events under BRICKLIVE brand
  • BRICKLIVE events have been held across multiple countries
  • Five-year touring deal signed with Nickelodeon
Live Company
OVERVIEW: LVCG The Big Picture
BRICKLIVE events range from large exhibitions that attract hundreds, to smaller cafes that parents and children can enjoy while taking a break from shopping

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:

Live Company Group Plc (LON:LVCG) holds events that use LEGO bricks to both educate and entertain adults and children through its BRICKLIVE brand.

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.

 

Inflextion points:

• In a July trading update, executive chairman David Ciclitira said he believed the company would exceed its events target for 2019

• For the year ended 31 December 2018, Live Company reported revenues of £5.35mln, 178% higher than the prior year, while overall losses narrowed to £2.61mln from £5.44mln previously

• The company has signed a deal to supply BRICKLIVE interactive brick-based content for an event to be held in Holon, Israel from 25 July to 31 August

• In mid-June, the company inked a touring agreement with the UK arm of children’s television network Nickelodeon. Under the five-year agreement, Live Company will produce themed tours associated with various Nickelodeon properties across the UK and Ireland, paying the network a royalty fee based on revenues generated

 

Interview – executive chairman David Ciclitira and executive director Andy Smith

 

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.

 

Blue Sky

Following the deal with Nickelodeon, executive director Andy Smith said that the agreement will cover multiple tours that will each be themed around a Nickelodeon franchise.

The first tour, scheduled to launch in the summer of 2019, will be based on the PAW Patrol series followed by a Nick Jr tour in September.

Further down the line, there will be a tour themed around SpongeBob SquarePants in January 2020, and over the entire five-year period Smith expects multiple tours all around the UK.

He adds that the association with a “world-class brand” like Nickelodeon will enhance the BRICKLIVE brand itself going forward.

In the coming months, Smith says the company will be focusing on delivering on the Nickelodeon deal, adding that the company is around “6 to 8 months ahead” of where they expected to be at this point in time.

Aside from the Nickelodeon tours, Live Company said there is a strong pipeline in place for future sales as it invests in content and producing five new BRICKLIVE Zoo touring assets over the next 12 months. The group expects the assets to generate £2mln in revenue and £1.6mln in gross profit in 2019.

With the shares trading at around 47p as of 5 July 2019, Live Company carries a market cap of £34.16mln.

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Live Company Group PLC Timeline

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