Release Date: November 04, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Total location revenue grew by 17.5% year over year, indicating strong business performance.
- EBITDA increased by over 20%, showcasing effective cost management and operational efficiency.
- Successful acquisitions, such as Raging Waves and Boomers, are expected to provide significant future growth opportunities.
- Food and beverage sales increased by 18% year over year, driven by new menu offerings and mobile ordering.
- The company has a robust pipeline for new builds, with several new locations opening soon, including the first bowling alley in Beverly Hills in nearly a century.
Negative Points
- Weather-related disruptions, including two hurricanes, negatively impacted revenue by approximately $2 million.
- Boomers acquisition is expected to be a drag on EBITDA until the peak season begins in June.
- Food costs remain a headwind, although there are signs of improvement.
- The macroeconomic environment presents challenges, with some softness observed in corporate bookings.
- The company faces ongoing challenges in managing inflation, particularly in food costs, which have impacted profitability.
Q & A Highlights
Q: Could you elaborate on the cadence of same center comps in the first quarter and trends you've seen in October, particularly between walk-in and events?
A: End of September, we were impacted by two hurricanes, costing about $2 million on the comp in the first quarter. October's weather hasn't been great, but events are tracking plus 10% for P6, which is crucial for our revenue and EBITDA for the quarter. β Thomas Shannon, CEO
Q: Can you discuss the drivers of EBITDA margin expansion in the first quarter and expectations for the second quarter?
A: The greatest margin expansion will occur in the third quarter due to New Year's shifting from the second to the third quarter, resulting in a $5 to $7 million swing. The second quarter will also see margin expansion, except for Boomers and Raging Waves, which will run through the income statement as negative. β Thomas Shannon, CEO
Q: How are you utilizing data differently now, and what are the expectations for the new Chief Procurement Officer?
A: We are becoming a data-driven organization, expanding Power BI subscriptions to hold department leaders accountable. The Chief Procurement Officer will focus on managing inflation and driving procurement synergies, as seen with the integration of Boomers' purchasing organization. β Bobby Lavan, CFO
Q: Can you provide insights into the fall pass program and its impact on business strategy?
A: The fall season pass was launched due to revenue softness, and it has shown encouraging results. We plan to focus more on the summer season pass, possibly expanding it to include Boomers and water parks for a more comprehensive offering. β Lev Ekster, President
Q: What are your thoughts on price versus volume going forward, and how did this play out last quarter?
A: We've successfully taken price on food, which has been a positive surprise. As we move into the core second and third quarters, this presents a good opportunity to augment the price taken on bowling with food pricing. β Lev Ekster, President
Q: How is mobile ordering impacting operations and customer response?
A: Mobile ordering has been rolled out across the organization, improving labor efficiency and customer satisfaction. We are piloting tablets to further enhance order processing and customer experience, aiming to increase food and beverage sales. β Lev Ekster, President
Q: Can you discuss the impact of the revamped event catering menu on holiday bookings and average event revenue?
A: December is pacing up 10% year over year for corporate and adult a la carte events, with both more events and higher dollar pickups expected. β Lev Ekster, President
Q: What are your findings from the Lucky Strike acquisition after one year, and how are the new build openings performing?
A: 11 of the 14 Lucky Strike assets are outperforming, with returns meeting expectations. All new builds are profitable, with Miami on pace to do $10 million in its first year, far exceeding underwriting expectations. β Thomas Shannon, CEO
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
