American Golf parent buys another 12 months with improved performance

Loss-making AGDC Holdings, the parent company of Warrington-based American Golf, has teed up a significant increase in turnover despite an 8.9% fall in participation in the sport, buying  time for at least another 12 months of trading.

In the year to January 22, 2017, the company’s revenue increased from £114.1m to £131.8m, but the it still made a pre-tax loss of £2.53m albeit down from the £4.42m loss of the prior year, mitigated by exceptional income of £609,000.

The company underwent a restructure and refinancing with its bankers and shareholder in March 2015.

“As part of this process the directors have reviews the trading and cash flow forecasts for the period to July 2018 as part of their going concern assessment,” director Brian Leach reports in the AGDC Holdings annual accounts.

“The directors consider the level of headroom to be sufficient and therefore, they believe there is a reasonable expectation that the group can continue as a going concern for at least the next 12 months.”

Leach attributed the company’s performance in a declining market to heavy investment in store improvements and additional staff training “providing customers with a friendly, expert-heavy environment, the availability of PGA professionals in every store, a busy promotional calendar and a rise in online sales.

“Our recent ‘Double Value Trade In’ promotion has also had a direct impact on the sales performance of the business,” he said.

“It has generated significant interest within the golf retail industry and has stimulated both the sale of new clubs and created a vibrant second-hand market, encouraging regular and lapsed golfers to either trade up or get started, extremely cost effectively.”

During the period the company opened four new stores and closed underperforming outlets.

AGDC’s staff number went up to 895 to 839 in the period.

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