Thrill ride: Pomvom's automated photography solution coming to Six Flags
Thrill ride: Pomvom's automated photography solution coming to Six Flags
The company, which develops photography solutions for theme parks, has signed a letter of intent with the American chain for what may be the biggest deal in its history, with revenues to potentially reach $21 million a year
The shares of Pomvom, which develops digital photography solutions for amusement parks, are surging on the Tel Aviv Stock Exchange after the company reported that it signed a letter of intent (LOI) with the American theme park giant Six Flags after winning a tender. Should the deal go ahead, Pomvom will provide its services to 11 parks of the chain in the U.S. over five years. The company estimates that its systems will start operating in the various parks by the end of 2024.
If all goes well, this will be the biggest deal in Pomvom’s history. According to Six Flags data, 33 million visitors visited its various parks in 2019. 13.2 million visitors visited the 11 parks where Pomvom is supposed to install its systems that year.
According to Pomvom’s reports for the third quarter of 2022, the company's average income from a visitor to the parks where its systems operate in the U.S. is $1.6. In other words, the deal with Six Flags has the potential to generate income of around $21 million per year.
For the first nine months of 2022, Pomvom recorded revenues of NIS 151.3 million (approximately $44 million) - a jump of 59% compared to revenues of NIS 95.1 million ($28 million) in the corresponding period in 2021. This is an annual revenue rate of about 200 million shekels (even though the activity of Pomvom is seasonal, with the second and third quarters of the year being the strongest). Pomvom ended 2021 with revenues of NIS 131.1 million ($38 million).
"This is a strategic deal that will change the mix of sites we are active in. Today, 70% of our revenue comes from parks in Europe," the company's CEO Yehuda Minkovitz told Calcalist. "This is one of the world's largest amusement park chains. This is still only a letter of intent and we expect the deal to be signed within a few weeks."
Pomvom's cameras capture the experiences of park visitors at the various attractions and allow visitors to purchase the products in printed or digital form and share on social media. The company's systems are installed in 21 amusement parks in Europe and the U.S., and it has agreements that should see the number of parks increase to 41. The agreement with Six Flags will increase the number to 52.
Pomvom - whose largest shareholder is the More Investment House through its provident funds and trust funds (19%) — began trading at a value of NIS 135 million in March 2021. The company raised NIS 38 million in an IPO at a value of NIS 97 million. Two months later, Pomvom reached a record value of 454 million shekels, but later, against the background of rising interest rates, the stock lost ground.
In the last 12 months, the stock fell by 73% and the company's market value returned to a value close to that at which it was issued - NIS 99 million.
