On September 4, 2024, Pinstripes Holdings Inc (PNST, Financial) released its 8-K filing for the fiscal quarter ended July 21, 2024. Pinstripes Holdings Inc is an experiential dining and entertainment concept combining exceptional Italian-American cuisine with bowling, bocce, and private events. The company owns and operates around 17 restaurants in the USA, each featuring large-format locations with extensive interior and outdoor spaces.
Performance Overview
Pinstripes Holdings Inc reported total revenue of $30.6 million for the first quarter of fiscal 2025, an 18.9% increase compared to the prior year fiscal quarter. This growth was driven by new venue development, with food and beverage revenues increasing by 16.1% to $23.8 million and recreation revenues rising by 29.7% to $6.8 million. However, same-store sales decreased by 2.4% over the prior year period, indicating challenges in maintaining growth at existing locations.
Financial Achievements and Challenges
Despite the revenue growth, the company faced significant challenges. The operating loss for the quarter was $7.6 million, including pre-opening expenses of $1.0 million, compared to an operating loss of $0.9 million in the prior year period. The net loss widened to $10.0 million from $3.0 million in the prior year period. Venue-Level EBITDA was $2.2 million, a decrease of $1.7 million from the prior year period, with a Venue-Level EBITDA margin of 7.2%, down 786 basis points.
"Our first quarter results did not meet our expectations as we faced a challenging macro environment. Nevertheless, our team remains focused on executing on our top-line and profitability initiatives while ensuring we provide our guests with those magical moments they’ve come to expect from visiting Pinstripes," stated Dale Schwartz, Founder and CEO.
Income Statement Highlights
| Metric | Q1 FY2025 | Q1 FY2024 |
|---|---|---|
| Total Revenue | $30.6 million | $25.7 million |
| Operating Loss | ($7.6 million) | ($0.9 million) |
| Net Loss | ($10.0 million) | ($3.0 million) |
| Venue-Level EBITDA | $2.2 million | $3.9 million |
Balance Sheet and Cash Flow
As of July 21, 2024, Pinstripes Holdings Inc reported total assets of $166.6 million, slightly down from $167.3 million as of April 28, 2024. The company’s cash and cash equivalents stood at $5.0 million, a significant decrease from $13.2 million at the beginning of the period. Total liabilities increased to $245.3 million from $236.5 million, reflecting higher long-term notes payable and operating lease liabilities.
Updated Fiscal 2025 Guidance
Pinstripes Holdings Inc provided updated guidance for fiscal 2025, projecting same-store sales growth in the range of negative low single digits to positive low single digits. The company plans to open two new venues and expects mature store Venue-Level EBITDA margins to be between 17-20%. General and administrative expenses, including non-cash stock compensation and tax, are estimated to be approximately $15 million, with pre-opening expenses around $3 million. Adjusted EBITDA is projected to be between $8-12 million.
Conclusion
While Pinstripes Holdings Inc demonstrated strong revenue growth driven by new venue development, the company faced significant challenges in terms of operating losses and net losses. The decrease in same-store sales and increased costs highlight the difficulties in maintaining profitability. However, the company's efforts to rationalize its cost structure and focus on top-line and profitability initiatives may position it for improved performance in the future.
Explore the complete 8-K earnings release (here) from Pinstripes Holdings Inc for further details.
