Reiterates FY24 Guidance and Provides 2Q24
Guidance
Bowlero Corp. (NYSE: BOWL) (“Bowlero” or the “Company”), the
world’s largest owner and operator of bowling centers, today
provided financial results for the first quarter of the 2024 Fiscal
Year, which ended on October 1, 2023.
First Quarter
Highlights:
- Revenue decreased 1.2% to $227.4 million versus the prior year
and increased 53.1% versus 1QFY20 (quarter ended September 29,
2019)
- Revenue excluding Service Fee Revenue increased 0.3% to $225.8
million versus the prior year and was up 52.0% versus 1QFY20
- Total Bowling Center Revenue down 0.7% versus the prior year
and was up 52.9% versus 1QFY20
- Same Store Revenue declined 5.5% versus the prior year and grew
27.1% versus 1QFY20
- Net income of $18.2 million versus prior year loss of $33.5
million and a loss of $19.7 million in 1QFY20
- Adjusted EBITDA of $52.1 million versus prior year of $65.3
million and $24.9 million in 1QFY20
- Added 18 centers during the quarter, 17 from acquisitions and 1
new build out
- Total centers in operation as of November 7, 2023 is 350
- Post quarter end, entered into a transaction with VICI
Properties Inc. on October 19, 2023 relating to the transfer of
land and real estate assets of 38 bowling entertainment centers for
an aggregate value of $432.9 million
“First quarter fiscal year 2024 met our expectations. Because
our first quarter is typically our seasonally lowest quarter, we
used this time to test a variety of promotions and new bundled
pricing structures. This experimentation drove a meaningful
reduction in same-store revenue from late July through early
September. Based on what we learned, we quickly struck the right
balance between mid-week and weekend pricing and got a deeper
understanding of our different customer segments. Same-store
revenue turned positive in mid-October. We are happy with those
results and continue to push forward with our plan to ensure
double-digit revenue growth this year,” said Thomas Shannon, Chief
Executive Officer and President.
Mr. Shannon continued, “In addition to strong momentum on
dynamic pricing, this quarter saw transformational changes to our
business. We entered into a partnership with VICI Properties in a
sale-leaseback of 38 properties for $432.9 million of value. VICI
will be an important partner as we continue our proven capital
efficiency model of self-funding bowling center acquisitions
through sale-leasebacks. We acquired the Lucky Strike brand and all
14 of Lucky Strike’s centers. We also acquired two premium centers
in Scottsdale, with Mavrix and Octane Raceway, and three additional
centers. Year to date we have spent $130 million on acquisitions.
We remain confident with a robust M&A pipeline, new build
activity in marquee markets, accelerated center conversions, and
the continued rollout of initiatives to enhance the customer
experience and increase wallet share.”
Share Repurchase Program
During the quarter, the Company repurchased 12.1 million shares
of Class A common stock, bringing the total common shares acquired
under the program to 23.4 million. Pro forma for additional Class A
common stock repurchased subsequent to quarter end, the total Class
A and Class B shares outstanding as of November 1, 2023 are
151,287,782.
Fiscal Year 2024 and Second Quarter 2024 Guidance
The Company reiterated financial guidance for fiscal year 2024
provided on September 11, 2023. The Company expects Revenue to be
up 10% to 15% at the end of fiscal year 2024, excluding the $21
million of Service Fee Revenue from prior year revenue, which
equates to $1.14 billion to $1.19 billion of Revenue. Adjusted
EBITDA margin is expected to be 32% to 34%, which equates to
Adjusted EBITDA of $365 million to $405 million. The Company
expects second quarter fiscal year 2024 to have Revenue Excluding
Service Fee Revenue of $295 million to $310 million and Adjusted
EBITDA of $100 million to $110 million. The Company expects to
heavily reinvest in the business in fiscal year 2024, with more
than $160 million allocated to acquisitions, $40 million to new
builds, and $75 million to conversions.
Investor Webcast Information
Listeners may access an investor webcast hosted by Bowlero. The
webcast and results presentation will be accessible at 10:00 AM ET
on November 7, 2023 in the Events & Presentations section of
the Bowlero Investor Relations website at
https://ir.bowlerocorp.com/overview/default.aspx.
About Bowlero Corp.
Bowlero is the global leader in bowling entertainment. With
approximately 350 bowling centers across North America, Bowlero
serves more than 30 million guests each year through a family of
brands that includes Bowlero, Lucky Strike and AMF. In 2019,
Bowlero acquired the Professional Bowlers Association, the major
league of bowling, which boasts thousands of members and millions
of fans across the globe. For more information on Bowlero, please
visit BowleroCorp.com.
Forward Looking Statements
Some of the statements contained in this press release are
forward-looking statements within the meaning of Section 27A of the
Securities Act of 1933, as amended, and Section 21E of the
Securities Exchange Act of 1934, as amended, that involve risk,
assumptions and uncertainties, such as statements of our plans,
objectives, expectations, intentions and forecasts. These
forward-looking statements are generally identified by the use of
forward-looking terminology, including the terms "anticipate,"
"believe," “confident,” “continue,” "could," "estimate," "expect,"
"intend," “likely,” "may," "plan," “possible,” "potential,"
"predict," "project," "should," "target," "will," "would" and, in
each case, their negative or other various or comparable
terminology. These forward-looking statements reflect our views
with respect to future events as of the date of this release and
are based on our management’s current expectations, estimates,
forecasts, projections, assumptions, beliefs and information.
Although management believes that the expectations reflected in
these forward-looking statements are reasonable, it can give no
assurance that these expectations will prove to have been correct.
All such forward-looking statements are subject to risks and
uncertainties, many of which are outside of our control, and could
cause future events or results to be materially different from
those stated or implied in this document. It is not possible to
predict or identify all such risks. These risks include, but are
not limited to: our ability to design and execute our business
strategy; changes in consumer preferences and buying patterns; our
ability to compete in our markets; the occurrence of unfavorable
publicity; risks associated with long-term non-cancellable leases
for our centers; our ability to retain key managers; risks
associated with our substantial indebtedness and limitations on
future sources of liquidity; our ability to carry out our expansion
plans; our ability to successfully defend litigation brought
against us; our ability to adequately obtain, maintain, protect and
enforce our intellectual property and proprietary rights and claims
of intellectual property and proprietary right infringement,
misappropriation or other violation by competitors and third
parties; failure to hire and retain qualified employees and
personnel; the cost and availability of commodities and other
products we need to operate our business; cybersecurity breaches,
cyber-attacks and other interruptions to our and our third-party
service providers’ technological and physical infrastructures;
catastrophic events, including war, terrorism and other conflicts;
public health emergencies and pandemics, such as the COVID-19
pandemic, or natural catastrophes and accidents; changes in the
regulatory atmosphere and related private sector initiatives;
fluctuations in our operating results; economic conditions,
including the impact of increasing interest rates, inflation and
recession; and other factors described under the section titled
“Risk Factors” in the Company's Annual Report on Form 10-K filed
with the U.S. Securities and Exchange Commission (the “SEC”) by the
Company on September 11, 2023, as well as other filings that the
Company will make, or has made, with the SEC, such as Quarterly
Reports on Form 10-Q and Current Reports on Form 8-K. These factors
should not be construed as exhaustive and should be read in
conjunction with the other cautionary statements that are included
in this press release and in other filings. We expressly disclaim
any obligation to publicly update or review any forward-looking
statements, whether as a result of new information, future
developments or otherwise, except as required by applicable
law.
Non-GAAP Financial Measures
To provide investors with information in addition to our results
as determined under Generally Accepted Accounting Principles
(“GAAP”), we disclose Revenue Excluding Service Fee Revenue, Total
Bowling Center Revenue, Same Store Revenue and Adjusted EBITDA as
“non-GAAP measures”, which management believes provide useful
information to investors because each measure assists both
investors and management in analyzing and benchmarking the
performance and value of our business. Accordingly, management
believes that these measurements are useful for comparing general
operating performance from period to period, and management relies
on these measures for planning and forecasting of future periods.
Additionally, these measures allow management to compare our
results with those of other companies that have different financing
and capital structures. These measures are not financial measures
calculated in accordance with GAAP and should not be considered as
a substitute for revenue, net income, or any other operating
performance or liquidity measure calculated in accordance with
GAAP, and may not be comparable to a similarly titled measure
reported by other companies. Our second quarter and fiscal year
2024 guidance measures (other than revenue) are provided on a
non-GAAP basis without a reconciliation to the most directly
comparable GAAP measure because the Company is unable to predict
with a reasonable degree of certainty certain items contained in
the GAAP measures without unreasonable efforts. For the same
reasons, the Company is unable to address the probable significance
of the unavailable information. Such items include, but are not
limited to, acquisition related expenses, stock-based compensation
and other items not reflective of the company's ongoing
operations.
Revenue Excluding Service Fee Revenue represents Total Revenue
less Service Fee Revenue. Total Bowling Center Revenue represents
Total Revenue less Non-Center Related Revenue, Revenue from Closed
Centers (as defined below), and Service Fee Revenue, if applicable.
Same Store Revenue represents Total Revenue less Non-Center Related
Revenue, Revenue from Closed Centers, Service Fee Revenue, if
applicable, and Acquired Revenue. Adjusted EBITDA represents Net
Income (Loss) before Interest Expense, Income Taxes, Depreciation
and Amortization, Share-based Compensation, EBITDA from Closed
Centers, Foreign Currency Exchange Loss (Gain), Asset Disposition
Loss (Gain), Transactional and other advisory costs, changes in the
value of earnouts and warrants and settlement costs, and other.
The Company considers Revenue Excluding Service Fee Revenue as
an important financial measure because provides a financial measure
of revenue directly associated with consumer discretionary spending
and Total Bowling Center Revenue as an important financial measure
because it provides a financial measure of revenue directly
associated with bowling center operations. The Company also
considers Same Store Revenue as an important financial measure
because it provides comparable revenue for centers open for the
entire duration of both the current and comparable measurement
periods.
The Company considers Adjusted EBITDA as an important financial
measure because it provides a financial measure of the quality of
the Company’s earnings. Other companies may calculate Adjusted
EBITDA differently than we do, which might limit its usefulness as
a comparative measure. Adjusted EBITDA is used by management in
addition to and in conjunction with the results presented in
accordance with GAAP. We have presented Adjusted EBITDA solely as a
supplemental disclosure because we believe it allows for a more
complete analysis of results of operations and assists investors
and analysts in comparing our operating performance across
reporting periods on a consistent basis by excluding items that we
do not believe are indicative of our core operating performance.
Adjusted EBITDA has limitations as an analytical tool, and you
should not consider it in isolation or as a substitute for analysis
of our results as reported under GAAP. Some of these limitations
are that Adjusted EBITDA:
- do not reflect every expenditure, future requirements for
capital expenditures or contractual commitments;
- do not reflect changes in our working capital needs;
- do not reflect the interest expense, or the amounts necessary
to service interest or principal payments, on our outstanding
debt;
- do not reflect income tax (benefit) expense, and because the
payment of taxes is part of our operations, tax expense is a
necessary element of our costs and ability to operate;
- do not reflect non-cash equity compensation, which will remain
a key element of our overall equity based compensation package;
and
- do not reflect the impact of earnings or charges resulting from
matters we consider not to be indicative of our ongoing
operations.
GAAP Financial Information
Bowlero Corp.
Condensed Consolidated Balance
Sheets
(Amounts in thousands, except
share and per share amounts)
(Unaudited)
October 1, 2023
July 2, 2023
Assets
Current assets:
Cash and cash equivalents
$
40,088
$
195,633
Accounts and notes receivable, net of
allowance for doubtful accounts
4,087
3,092
Inventories, net
13,183
11,470
Prepaid expenses and other current
assets
19,393
18,395
Assets held-for-sale
2,069
2,069
Total current assets
78,820
230,659
Property and equipment, net
773,057
697,850
Internal use software, net
20,792
17,914
Operating lease right of use assets,
net
550,113
449,085
Finance lease right of use assets, net
540,186
515,339
Intangible assets, net
100,087
90,986
Goodwill
825,522
753,538
Deferred income tax asset
86,237
73,807
Other assets
12,582
12,096
Total assets
$
2,987,396
$
2,841,274
Liabilities, Temporary Equity and
Stockholders’ Equity
Current liabilities:
Accounts payable and accrued expenses
$
141,164
$
121,226
Current maturities of long-term debt
9,595
9,338
Current obligations of operating lease
liabilities
26,194
23,866
Other current liabilities
16,650
14,281
Total current liabilities
193,603
168,711
Long-term debt, net
1,276,371
1,138,687
Long-term obligations of operating lease
liabilities
541,937
431,295
Long-term obligations of financing lease
liabilities
678,720
652,450
Earnout liability
71,364
112,041
Other long-term liabilities
35,220
34,380
Deferred income tax liabilities
4,079
4,160
Total liabilities
2,801,294
2,541,724
Commitments and Contingencies
October 1, 2023
July 2, 2023
Temporary Equity
Series A preferred stock
$
144,329
$
144,329
Stockholders’ Equity
Class A common stock
10
11
Class B common stock
6
6
Additional paid-in capital
507,935
506,112
Treasury stock, at cost
(268,063
)
(135,401
)
Accumulated deficit
(201,440
)
(219,659
)
Accumulated other comprehensive income
3,325
4,152
Total stockholders’ equity
41,773
155,221
Total liabilities, temporary equity and
stockholders’ equity
$
2,987,396
$
2,841,274
Bowlero Corp.
Condensed Consolidated Statements
of Operations
(Amounts in thousands)
(Unaudited)
Three Months Ended
October 1, 2023
October 2, 2022
Revenues
$
227,405
$
230,260
Costs of revenues
182,921
165,202
Gross profit
44,484
65,058
Operating (income) expenses:
Selling, general and administrative
expenses
37,765
32,494
Asset impairment
26
84
Gain on sale or disposal of assets
(27
)
(155
)
Other operating expense
1,364
1,362
Total operating expense
39,128
33,785
Operating profit
5,356
31,273
Other (income) expenses:
Interest expense, net
37,449
23,570
Change in fair value of earnout
liability
(40,682
)
40,760
Other expense
53
48
Total other (income) expense
(3,180
)
64,378
Income (loss) before income tax
(benefit) expense
8,536
(33,105
)
Income tax (benefit) expense
(9,683
)
429
Net income (loss)
$
18,219
$
(33,534
)
Bowlero Corp.
Condensed Consolidated Statements
of Cash Flows
(Amounts in thousands)
(Unaudited)
Three Months Ended
October 1, 2023
October 2, 2022
Net cash provided by operating
activities
$
16,083
$
35,573
Net cash used in investing activities
(176,576
)
(62,492
)
Net cash provided by financing
activities
5,091
5,167
Effect of exchange rate changes on
cash
(143
)
(123
)
Net decrease in cash and cash
equivalents
(155,545
)
(21,875
)
Cash and cash equivalents at beginning of
period
195,633
132,236
Cash and cash equivalents at end of
period
$
40,088
$
110,361
GAAP to non-GAAP Reconciliations
FY24 vs. FY20
FY24 vs. FY23
(in thousands)
September 29, 2019
October 1, 2023
October 2, 2022
October 1, 2023
Total Revenue - Reported
$
148,570
$
227,405
$
230,260
$
227,405
less: Service Fee Revenue
—
(1,556
)
(4,975
)
(1,556
)
Revenue excluding Service Fee Revenue
$
148,570
$
225,849
$
225,285
$
225,849
less: Non-Center Related (including Closed
Centers)
(5,693
)
(7,419
)
(5,245
)
(7,419
)
Total Bowling Center Revenue
$
142,877
$
218,430
$
220,040
$
218,430
less: Acquired Revenue
(541
)
(37,497
)
(347
)
(10,784
)
Same Store Revenue
$
142,336
$
180,933
$
219,693
$
207,646
% Year-over-Year
Change
Total Revenue – Reported
53.1
%
(1.2
)%
Total Revenue excluding Service Fee
Revenue
52.0
%
0.3
%
Total Bowling Center Revenue
52.9
%
(0.7
)%
Same Store Revenue
27.1
%
(5.5
)%
Adjusted EBITDA
Reconciliation
Three Months Ended
(in thousands)
October 1, 2023
October 2, 2022
September 29, 2019
Consolidated
Revenue
$
227,405
$
230,260
$
148,570
Net income (loss) - GAAP
18,219
(33,534
)
(19,719
)
Net income (loss) margin
8.0
%
(14.6
)%
(13.3
)%
Adjustments:
Interest expense
39,032
23,570
19,665
Income tax (benefit) expense
(9,683
)
429
153
Depreciation, amortization and impairment
charges
32,026
26,351
21,102
Share-based compensation
1,911
3,648
869
Closed center EBITDA (1)
2,462
379
1,116
Foreign currency exchange loss (gain)
79
(71
)
—
Asset disposition gain
(27
)
(155
)
66
Transactional and other advisory costs
(2)
8,398
4,166
1,308
Changes in the value of earnouts (3)
(40,682
)
40,760
—
Other, net (4)
399
(234
)
371
Adjusted EBITDA
$
52,134
$
65,309
$
24,931
Adjusted EBITDA Margin
22.9
%
28.4
%
16.8
%
- The closed center adjustment is to remove EBITDA for closed
centers. Closed centers are those centers that are closed for a
variety of reasons, including permanent closure, newly acquired or
built centers prior to opening, centers closed for renovation or
rebranding and conversion. If a center is not open on the last day
of the reporting period, it will be considered closed for that
reporting period. If the center is closed on the first day of the
reporting period for permanent closure, the center will be
considered closed for that reporting period.
- The adjustment for transaction costs and other advisory costs
is to remove charges incurred in connection with any transaction,
including mergers, acquisitions, refinancing, amendment or
modification to indebtedness, dispositions and costs in connection
with an initial public offering, in each case, regardless of
whether consummated.
- The adjustment for changes in the value of earnouts is to
remove of the impact of the revaluation of the earnouts. As a
result of the Business Combination, the Company recorded
liabilities for earnouts. Changes in the fair value of the earnout
liability is recognized in the statement of operations. Decreases
in the liability will have a favorable impact on the statement of
operations and increases in the liability will have an unfavorable
impact.
- Other includes the following related to transactions that do
not represent ongoing or frequently recurring activities as part of
the Company’s operations: (i) non-routine expenses, net of
recoveries for matters outside the normal course of business and
(ii) other individually de minimis expenses. Certain prior year
amounts have been reclassified to conform to current year
presentation.
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version on businesswire.com: https://www.businesswire.com/news/home/20231107461461/en/
Bowlero Corp. Investor Relations IRSupport@BowleroCorp.com
Grafico Azioni Bowlero (NYSE:BOWL)
Storico
Da Dic 2024 a Gen 2025
Grafico Azioni Bowlero (NYSE:BOWL)
Storico
Da Gen 2024 a Gen 2025
