Investment summary

In its AGM trading update Lo-Q said it remains well placed to perform in line with current market expectations. As previously announced, the Q-band product has begun its launch with a bang, with contracts for nine Six Flags water parks, Palace Entertainments’ Splish Splash park in Long Island, New York, and Zoombezi Bay in Ohio. Given the investment in new installed systems and the increased cost base we expect a bigger H1 loss and cash out-flow than H111. While the shares look pricey in PE terms (c 21x FY12 EPS falling to c 19x in FY13) there is plenty of momentum, which is set to drive growth over the next few years.

Last updated on 23/04/2012

Industry outlook

Lo-Q designs, installs and operates virtual queuing systems, which are deployed on a revenue-share basis with theme parks and other attractions. Some 14 years have been spent developing these technologies, many of which are patent protected. The group’s Q-bot products are used by four of the 10 largest theme park operators globally, while the newer Q-band is opening up new markets, including water parks.

Last updated on 23/04/2012