The East Kilbride company’s pre-tax profits slumped 25.7 per cent to £2.6 million in the first six months of 2017, for which no dividend will be paid.
That compared with a profit of £3.5m in the opening half of last year. Sales in the latest period rose 2.2 per cent to £17.4m, but Goals said it was “cautious” given pressures on consumer spending, and that like-for-like sales in the second half were set to grow more slowly than expected.
Goals said the expected slowdown was mainly due to some sites underperforming that “have not received the required level of arena investment”.
The company said: “Although the overall turnaround to profitable growth is taking slightly longer than anticipated there are good early signs of growth from our investments in the arena upgrade programme and the Clubhouse 2020 pilot sites.”
Clubhouse 2020 is meant to provide modernised check-in facilities and improvements to the firm’s food and drink offering as Goals seeks to encourage its customers to spend more.
Like-for-like sales in the first trading half lifted 1.6 per cent, the group having returned to profit in 2016 after sinking into the red in 2015.
Sahill Shan, analyst with N+1 Singer, said the company’s forecast that the recovery would happen less quickly that expected was “a notable fly in the ointment”.
Shan said the tempering of sales guidance for the second half “reflects muted summer trading at 40 per cent of the UK portfolio which is not at optimum investment and consumer caution.
“This is clearly a setback for the new management having arrested the like-for-like sales decline and evidenced some encouraging results across 60 per cent of the estate”. The shares closed down 9.5p at 94.5p.
In July, Goals unveiled a joint venture with Manchester City FC owner, City Football Group, which is going to plough $16m (£12m) into launching new sites across America to add to Goals’ current sites in California. Construction work on its fourth US club will kick off early next year, having started building its third venue in June.
That announcement came as Goals also pulled out of merger talks with Paisley-based rival Powerleague.
Mark Jones, Goals’ chief executive, said yesterday’s news “does not take the gloss off” the company’s enthusiasm for its planned American expansion.
“The new structure will help the UK business. UK cash can be invested in the UK business,” Jones said. “We were previously using our UK cash flows to fund the US operations.”
The company said that 27 of its clubs with five or more of their arenas upgraded had seen sales growth of 5 per cent for the first ten weeks of the second trading half.