Bingo may seem staid compared with online gaming but Graham Kerr, new chief executive of Top Ten, is determined to set pulses racing at the UK’s third biggest operator.

Kerr has 25 years’ experience in the industry and, after accepting shares for his stake in Walkers, his 13-strong chain of bingo clubs taken over by Top Ten earlier this summer, he is keen to grow the group from its current 38 outlets. Before the Walkers deal, Top Ten was managed by the Weston family whose 11 clubs had formed the nucleus of the group. Kerr now wants to make acquisitions in this industry, ripe for consolidation.

Gala and Mecca, owned by Rank, dominate the market, with over 100 clubs each, but this means competition law would restrict them growing further, allowing Top Ten free rein to choose the prime clubs from the 300 privately run concerns. He is also happy to sell some of the town centre properties – many are freeholds – at the right price.

Bingo is highly cash generative. During the year to March earnings per share rose 24% to 0.36p on turnover up 23% to £13.9m. Following the Walkers acquisition sales this year should jump to £22.75m and earnings increase to 0.42p a share, giving a p/e of 12.5. That compares with a mooted rating of 21 for Gala, which is soon to float. One cloud on the horizon is the threatened smoking ban, but Kerr thinks the impact will not be as bad as feared.

Top Ten Holdings	AIM	£0.63m	2.50p	0.00p
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