MIDAS TIPS: Accesso makes quick profits as theme parks go high-tech

Who fancies going to Legoland? Although the prospect of visiting a theme park in summer terrifies many parents, millions of them end up making the trip to Windsor to give the kids a Christmas treat. Legoland, one of the UK’s most popular entertainment venues, receives around 2.5 million visitors a year. Most of these are in summer, so waiting times for attractions can be long – often 30 minutes or more.

Queuing with small children is not for the faint-hearted, but adults with deep pockets can pay more and wait less. Prices vary, but for up to £90 a ticket, visitors can keep queues to a minimum – it’s not cheap, but more than a few harried mums and dads will consider it a good investment.

Accesso provides the technology for Legoland ticketing, from basic online purchases to VIP experiences. The company is an expert in digital ticketing and has clients ranging from Disney World in Florida to the Pyramids of Egypt and ski resorts across North America.

Accesso shares were worth almost £30 in 2018. Today they are around £7. First, the company spiralled out of control and profits plummeted. Then Covid hit and leisure venues closed for months. Just as the group was regaining its footing, tech experts’ salaries soared, driving costs through the roof.

Now, however, Accesso is firing on all cylinders and the stock should respond.

CEO Steve Brown trained at Disney and has spent his entire working life in the theme park and ticketing industries. At the helm of Accesso from 2012 to 2018, he briefly stepped down to pursue other interests but returned to the company in 2020, determined to put it back on track for growth.

Recent results have been encouraging and the future should be even better.

Accesso offers businesses three core services: virtual queuing, online ticketing, and restaurant ordering via mobile phones and automated kiosks. Each is designed to help customers generate more cash, and the potential is huge.

The group already works with around 1,200 theme parks, festivals, sports stadiums, ski resorts and a host of other entertainment venues, but there is plenty of room for growth and Brown is aggressively pursuing opportunities, both organically and through acquisitions.

Virtual queues have been a mainstay of the business from the beginning, and Brown continues to add features, gain clients and move to different parts of the world.

Businesses like the software because it increases sales and improves the day-to-day experience, which motivates more visitors to come and return.

Online ticketing is also popular with operators, as Accesso’s technology gives them the opportunity to tempt consumers with additional extras, from better seats to overnight stays.

Ordering restaurant food online is a more recent offering but one that is rapidly gaining ground.

Visitors to theme parks and other venues no longer want to wait long periods of time when the family is hungry. They can now find a restaurant they like and choose their meal and pick-up time.

Research shows that food orders tend to be at least ten percent larger when automated, with the technology designed to offer specialties and delicacies to entice diners.

Automation also reduces the need to hire temporary staff.

Accesso is listed on Aim, but the company makes around 70 percent of its revenues in the United States and Canada. Brown would like to change this and has already started to secure new contracts in the Middle East, Asia and continental Europe.

Brokers expect Accesso’s sales to rise seven per cent to $160m (£125m) this year, with underlying profits rising almost 15 per cent to $18.8m (£14.6m).

The pace of growth is expected to accelerate next year and into 2026 as Brown signs new deals and moves into other parts of the world.

There is no dividend at this time, but that may change as earnings begin to increase.

Midas Verdict: Brits are renowned for their ability to queue quietly, but if we had the choice, most of us would rather not. Accesso Technology helps families and friends make the most of trips and events, while also helping its business clients make more money. At £7, the shares should also benefit investors.

Listed in: AIM Heart: ACSO Contact: accesso.com or 0118 934 7400