☒ | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
☐ | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
Delaware | 35-2382255 | ||
(State of Incorporation) | (I.R.S. Employer ID) | ||
2481 Mañana Drive, Dallas, Texas, 75220 | (214) 357-9588 | ||
(Address of principal executive offices) (Zip Code) | (Registrant’s telephone number) |
Title of each class | Trading | Name of each exchange | ||||
Common Stock $0.01 par value | PLAY | NASDAQ Global Select Market | ||||
Preferred Stock Purchase Rights | PLAY | NASDAQ Global Select Market |
Large accelerated filer | ☒ | Accelerated filer | ☐ | ||||||
Non-accelerated filer | ☐ | ||||||||
Emerging Growth Company | ☐ |
Page | ||||||||||
PART I | ||||||||||
Item 1. | 3 | |||||||||
Item 2. | 18 | |||||||||
Item 3. | 33 | |||||||||
Item 4. | 33 | |||||||||
PART II | ||||||||||
Item 1. | 33 | |||||||||
Item 1A. | 33 | |||||||||
Item 2. | 36 | |||||||||
Item 6. | 37 | |||||||||
38 |
Item 1. | Financial Statements |
May 3, | February 2, | |||||||
2020 | 2020 | |||||||
(unaudited) | (audited) | |||||||
ASSETS | ||||||||
Current assets: | ||||||||
Cash and cash equivalents | $ | 156,833 | $ | 24,655 | ||||
Inventories | 34,726 | 34,477 | ||||||
Prepaid expenses | 13,018 | 14,269 | ||||||
Income taxes receivable | 23,241 | 2,331 | ||||||
Other current assets | 1,974 | 3,245 | ||||||
Total current assets | 229,792 | 78,977 | ||||||
Property and equipment (net of $706,468 and $686,824 accumulated depreciation as of May 3, 2020 and February 2, 2020, respectively) | 905,577 | 900,637 | ||||||
Operating lease right of use assets | 1,045,598 | 1,011,568 | ||||||
Deferred tax assets | 11,136 | 7,639 | ||||||
Tradenames | 79,000 | 79,000 | ||||||
Goodwill | 272,702 | 272,636 | ||||||
Other assets and deferred charges | 19,546 | 19,682 | ||||||
Total assets | $ | 2,563,351 | $ | |||||
LIABILITIES AND STOCKHOLDERS’ EQUITY | ||||||||
Current liabilities: | ||||||||
Current installments of long-term debt | $ | 15,000 | $ | 15,000 | ||||
Accounts payable | 79,083 | 65,359 | ||||||
Accrued liabilities | 221,405 | 207,452 | ||||||
Income taxes payable | 1,207 | 3,054 | ||||||
Total current liabilities | 316,695 | 290,865 | ||||||
Deferred income taxes | 19,847 | 19,102 | ||||||
Operating lease liabilities | 1,259,687 | 1,222,054 | ||||||
Other liabilities | 39,226 | 35,779 | ||||||
Long-term debt, net | 735,261 | 632,689 | ||||||
Commitments and contingencies | ||||||||
Stockholders’ equity: | ||||||||
Common stock, par value $0.01; authorized: 400,000,000 shares; issued: 49,578,351 shares at May 3, 2020 and 43,386,852 shares at February 2, 2020; outstanding: 36,791,727 shares at May 3, 2020 and 30,603,340 shares at February 2, 2020 | 496 | 434 | ||||||
Preferred stock, 50,000,000 authorized; NaN issued | — | — | ||||||
Paid-in capital | 411,048 | 339,161 | ||||||
Treasury stock, 12,786,624 and 12,783,512 shares as of May 3, 2020 and February 2, 2020, respectively | (595,077 | ) | (595,041 | ) | ||||
Accumulated other comprehensive loss | (13,753 | ) | �� | (8,369 | ) | |||
Retained earnings | 389,921 | 433,465 | ||||||
Total stockholders’ equity | 192,635 | 169,650 | ||||||
Total liabilities and stockholders’ equity | $ | 2,563,351 | $ | 2,370,139 | ||||
Thirteen Weeks | Thirteen Weeks | |||||||
Ended | Ended | |||||||
May 3, 2020 | May 5, 2019 | |||||||
Food and beverage revenues | $ | 63,920 | $ | 148,221 | ||||
Amusement and other revenues | 95,886 | 215,361 | ||||||
Total revenues | 159,806 | 363,582 | ||||||
Cost of food and beverage | 17,344 | 38,754 | ||||||
Cost of amusement and other | 10,728 | 22,971 | ||||||
Total cost of products | 28,072 | 61,725 | ||||||
Operating payroll and benefits | 43,737 | 82,873 | ||||||
Other store operating expenses | 95,672 | 106,245 | ||||||
General and administrative expenses | 14,563 | 16,846 | ||||||
Depreciation and amortization expense | 35,352 | 31,141 | ||||||
Pre-opening costs | 3,823 | 7,002 | ||||||
Total operating costs | 221,219 | 305,832 | ||||||
Operating income (loss) | (61,413 | ) | 57,750 | |||||
Interest expense, net | 6,115 | 4,056 | ||||||
Income (loss) before provision (benefit) for income taxes | (67,528 | ) | 53,694 | |||||
Provision (benefit) for income taxes | (23,984 | ) | 11,251 | |||||
Net income (loss) | (43,544 | ) | 42,443 | |||||
Unrealized foreign currency translation loss | (435 | ) | (191 | ) | ||||
Unrealized loss of derivatives, net of tax | (4,949 | ) | (2,534 | ) | ||||
Total other comprehensive loss | (5,384 | ) | (2,725 | ) | ||||
Total comprehensive income (loss) | $ | (48,928 | ) | $ | 39,718 | |||
Net income ( per share:loss ) | ||||||||
Basic | $ | (1.37 | ) | $ | 1.15 | |||
Diluted | $ | (1.37 | ) | $ | 1.13 | |||
Weighted average shares used in per share calculations: | ||||||||
Basic | 31,829,985 | 36,827,665 | ||||||
Diluted | 31,829,985 | 37,591,944 |
Thirteen Weeks Ended May 3, 2020 | ||||||||||||||||||||||||||||||||
Common Stock | Paid-In Capital | Treasury Stock At Cost | Accumulated Other Comprehensive Loss | Retained Earnings | Total | |||||||||||||||||||||||||||
Shares | Amt. | Shares | Amt. | |||||||||||||||||||||||||||||
Balance February 2, 2020 | 43,386,852 | $ | 434 | $ | 339,161 | 12,783,512 | $ | (595,041 | ) | $ | (8,369 | ) | $ | 433,465 | $ | 169,650 | ||||||||||||||||
Net income (loss) | — | — | — | — | — | — | (43,544 | ) | (43,544 | ) | ||||||||||||||||||||||
Unrealized foreign currency loss | — | — | — | — | — | (435 | ) | — | (435 | ) | ||||||||||||||||||||||
Unrealized loss of derivatives, net of | — | — | — | — | — | (4,949 | ) | — | (4,949 | ) | ||||||||||||||||||||||
Share-based compensation | — | — | (389 | ) | — | — | — | — | (389 | ) | ||||||||||||||||||||||
Issuance of common stock | 6,191,499 | 62 | 72,276 | — | — | — | — | 72,338 | ||||||||||||||||||||||||
Repurchase of common stock | — | — | — | 3,112 | (36 | ) | — | — | (36 | ) | ||||||||||||||||||||||
Balance May 3, 2020 | 49,578,351 | $ | 496 | $ | 411,048 | 12,786,624 | $ | (595,077 | ) | $ | (13,753 | ) | $ | 389,921 | $ | 192,635 | ||||||||||||||||
Thirteen Weeks Ended May 5, 2019 | ||||||||||||||||||||||||||||||||
Common Stock | Paid-In Capital | Treasury Stock At Cost | Accumulated Other Comprehensive Loss | Retained Earnings | Total | |||||||||||||||||||||||||||
Shares | Amt. | Shares | Amt. | |||||||||||||||||||||||||||||
Balance February 3, 2019 | 43,177,476 | $ | 432 | $ | 331,255 | 5,655,391 | $ | (297,129 | ) | $ | (683 | ) | $ | 353,962 | $ | 387,837 | ||||||||||||||||
Cumulative effect of a change in accounting principle, net of tax | (145 | ) | (145 | ) | ||||||||||||||||||||||||||||
Net income | — | — | — | — | — | — | 42,443 | 42,443 | ||||||||||||||||||||||||
Unrealized foreign currency loss | — | — | — | — | — | (191 | ) | — | (191 | ) | ||||||||||||||||||||||
Unrealized loss of derivatives, net of tax | — | — | — | — | — | (2,534 | ) | — | (2,534 | ) | ||||||||||||||||||||||
Share-based compensation | — | — | 1,825 | — | — | — | — | 1,825 | ||||||||||||||||||||||||
Issuance of common stock | 145,573 | 1 | 435 | — | — | — | — | 436 | ||||||||||||||||||||||||
Repurchase of common stock | — | — | 1,302,900 | (64,057 | ) | — | — | (64,057 | ) | |||||||||||||||||||||||
Dividends declared ($0.15 per share) | — | — | — | — | — | — | (5,489 | ) | (5,489 | ) | ||||||||||||||||||||||
Balance May 5, 2019 | 43,323,049 | $ | 433 | $ | 333,515 | 6,958,291 | $ | (361,186 | ) | $ | (3,408 | ) | $ | 390,771 | $ | 360,125 | ||||||||||||||||
Thirteen Weeks Ended May 3, 2020 | Thirteen Weeks Ended May 5, 2019 | |||||||
Cash flows from operating activities: | ||||||||
Net income (loss) | $ | (43,544 | ) | $ | 42,443 | |||
Adjustments to reconcile net income to net cash provided by operating activities: | ||||||||
Depreciation and amortization expense | 35,352 | 31,141 | ||||||
Non-cash interest expense | 314 | — | ||||||
Impairment of long-lived assets | 11,549 | — | ||||||
Deferred taxes | (892 | ) | 1,511 | |||||
Loss on disposal of fixed assets | 153 | 420 | ||||||
Share-based compensation | (389 | ) | 1,825 | |||||
Other, net | (156 | ) | 185 | |||||
Changes in assets and liabilities: | ||||||||
Inventories | (249 | ) | (2,294 | ) | ||||
Prepaid expenses | 1,828 | (2,036 | ) | |||||
Income tax receivable | (20,910 | ) | 786 | |||||
Other current assets | 1,271 | 827 | ||||||
Other assets and deferred charges | (110 | ) | 33 | |||||
Accounts payable | 21,441 | (5,727 | ) | |||||
Accrued liabilities | 11,647 | 9,218 | ||||||
Income taxes payable | (1,847 | ) | 7,884 | |||||
Other liabilities | 1,359 | (476 | ) | |||||
Net cash provided by operating activities | 16,817 | 85,740 | ||||||
Cash flows from investing activities: | ||||||||
Capital expenditures | (55,168 | ) | (67,247 | ) | ||||
Proceeds from sales of property and equipment | 18 | 135 | ||||||
Net cash used in investing activities | (55,150 | ) | (67,112 | ) | ||||
Cash flows from financing activities: | ||||||||
Proceeds from debt | 138,000 | 81,000 | ||||||
Payments of debt | (34,750 | ) | (31,750 | ) | ||||
Net proceeds from the issuance of common stock | 72,144 | — | ||||||
Proceeds from the exercise of stock options | 44 | 436 | ||||||
Repurchase of common stock under share repurchase program | — | (63,471 | ) | |||||
Dividends paid | (4,891 | ) | (5,489 | ) | ||||
Repurchases of common stock to satisfy employee withholding tax obligations | (36 | ) | (586 | ) | ||||
Net cash provided by (used in) financing activities | 170,511 | (19,860 | ) | |||||
Increase (decrease) in cash and cash equivalents | 132,178 | (1,232 | ) | |||||
Beginning cash and cash equivalents | 24,655 | 21,585 | ||||||
Ending cash and cash equivalents | $ | 156,833 | $ | 20,353 | ||||
Supplemental disclosures of cash flow information: | ||||||||
Decrease in fixed asset accounts payable | $ | (7,717 | ) | $ | (5,838 | ) | ||
Cash paid (refund received) for income taxes, net | $ | (357 | ) | $ | 1,068 | |||
Cash paid for interest, net | $ | 5,574 | $ | 3,743 |
November 1, 2020 | February 2, 2020 | |||||||
(unaudited) | (audited) | |||||||
ASSETS | ||||||||
Current assets: | ||||||||
Cash and cash equivalents | $ | 8,341 | $ | 24,655 | ||||
Inventories | 26,732 | 34,477 | ||||||
Prepaid expenses | 12,080 | 14,269 | ||||||
Income taxes receivable | 44,574 | 2,331 | ||||||
Other current assets | 665 | 3,245 | ||||||
Total current assets | 92,392 | 78,977 | ||||||
Property and equipment (net of $767,510 and $686,824 accumulated depreciation as of November 1, 2020 and February 2, 2020, respectively) | 846,056 | 900,637 | ||||||
Operating lease right of use assets | 1,050,878 | 1,011,568 | ||||||
Deferred tax assets | 20,451 | 7,639 | ||||||
Tradenames | 79,000 | 79,000 | ||||||
Goodwill | 272,643 | 272,636 | ||||||
Other assets and deferred charges | 23,641 | 19,682 | ||||||
Total assets | $ | 2,385,061 | $ | 2,370,139 | ||||
LIABILITIES AND STOCKHOLDERS’ EQUITY | ||||||||
Current liabilities: | ||||||||
Current installments of long-term debt | $ | — | $ | 15,000 | ||||
Accounts payable | 42,849 | 65,359 | ||||||
Accrued liabilities | 244,163 | 207,452 | ||||||
Income taxes payable | 415 | 3,054 | ||||||
Total current liabilities | 287,427 | 290,865 | ||||||
Deferred income taxes | 13,355 | 19,102 | ||||||
Operating lease liabilities | 1,277,794 | 1,222,054 | ||||||
Other liabilities | 37,896 | 35,779 | ||||||
Long-term debt, net | 561,815 | 632,689 | ||||||
Commitments and contingencies | ||||||||
Stockholders’ equity: | ||||||||
Common stock, par value $0.01; authorized: 400,000,000 shares; issued: 60,483,730 shares at November 1, 2020 and 43,386,852 shares at February 2, 2020; outstanding: 47,642,029 shares at November 1, 2020 and 30,603,340 shares at February 2, 2020 | 605 | 434 | ||||||
Preferred stock, 50,000,000 authorized; NaN issued | — | — | ||||||
Paid-in capital | 529,523 | 339,161 | ||||||
Treasury stock, 12,841,701 and 12,783,512 shares as of November 1, 2020 and February 2, 2020, respectively | (595,957 | ) | (595,041 | ) | ||||
Accumulated other comprehensive loss | (10,673 | ) | (8,369 | ) | ||||
Retained earnings | 283,276 | 433,465 | ||||||
Total stockholders’ equity | 206,774 | 169,650 | ||||||
Total liabilities and stockholders’ equity | $ | 2,385,061 | $ | 2,370,139 | ||||
Thirteen Weeks Ended November 1, 2020 | Thirteen Weeks Ended November 3, 2019 | |||||||
Food and beverage revenues | $ | 38,346 | $ | 124,637 | ||||
Amusement and other revenues | 70,706 | 174,715 | ||||||
Total revenues | 109,052 | 299,352 | ||||||
Cost of food and beverage | 10,664 | 33,384 | ||||||
Cost of amusement and other | 7,244 | 18,796 | ||||||
Total cost of products | 17,908 | 52,180 | ||||||
Operating payroll and benefits | 27,704 | 76,165 | ||||||
Other store operating expenses | 70,783 | 110,713 | ||||||
General and administrative expenses | 11,746 | 16,210 | ||||||
Depreciation and amortization expense | 34,384 | 33,340 | ||||||
Pre-opening costs | 2,570 | 4,245 | ||||||
Total operating costs | 165,095 | 292,853 | ||||||
Operating income (loss) | (56,043 | ) | 6,499 | |||||
Interest expense, net | 8,213 | 6,110 | ||||||
Loss on debt refinance | 904 | — | ||||||
Income (loss) before benefit for income taxes | (65,160 | ) | 389 | |||||
Benefit for income taxes | (17,117 | ) | (93 | ) | ||||
Net income (loss) | (48,043 | ) | 482 | |||||
Unrealized foreign currency translation gain | 34 | 59 | ||||||
Unrealized gain (loss) on derivatives, net of tax | 1,370 | (1,568 | ) | |||||
Total other comprehensive income (loss) | 1,404 | (1,509 | ) | |||||
Total comprehensive loss | $ | (46,639 | ) | $ | (1,027 | ) | ||
Net income (loss) per share: | ||||||||
Basic | $ | (1.01 | ) | $ | 0.02 | |||
Diluted | $ | (1.01 | ) | $ | 0.02 | |||
Weighted average shares used in per share calculations: | ||||||||
Basic | 47,613,741 | 30,980,878 | ||||||
Diluted | 47,613,741 | 31,515,454 |
Thirty-Nine Weeks Ended November 1, 2020 | Thirty-Nine Weeks Ended November 3, 2019 | |||||||
Food and beverage revenues | $ | 119,268 | $ | 410,779 | ||||
Amusement and other revenues | 200,423 | 596,754 | ||||||
Total revenues | 319,691 | 1,007,533 | ||||||
Cost of food and beverage | 32,667 | 109,072 | ||||||
Cost of amusement and other | 21,997 | 64,456 | ||||||
Total cost of products | 54,664 | 173,528 | ||||||
Operating payroll and benefits | 85,197 | 239,965 | ||||||
Other store operating expenses | 229,137 | 321,334 | ||||||
General and administrative expenses | 35,587 | 49,047 | ||||||
Depreciation and amortization expense | 104,896 | 97,226 | ||||||
Pre-opening costs | 8,781 | 15,970 | ||||||
Total operating costs | 518,262 | 897,070 | ||||||
Operating income (loss) | (198,571 | ) | 110,463 | |||||
Interest expense, net | 22,491 | 14,771 | ||||||
Loss on debt refinance | 904 | — | ||||||
Income (loss) before provision (benefit) for income taxes | (221,966 | ) | 95,692 | |||||
Provision (benefit) for income taxes | (71,777 | ) | 20,411 | |||||
Net income (loss) | (150,189 | ) | 75,281 | |||||
Unrealized foreign currency translation gain (loss) | (97 | ) | 2 | |||||
Unrealized loss on derivatives, net of tax | (2,207 | ) | (7,475 | ) | ||||
Total other comprehensive loss | (2,304 | ) | (7,473 | ) | ||||
Total comprehensive income (loss) | $ | (152,493 | ) | $ | 67,808 | |||
Net income (loss) per share: | ||||||||
Basic | $ | (3.56 | ) | $ | 2.19 | |||
Diluted | $ | (3.56 | ) | $ | 2.15 | |||
Weighted average shares used in per share calculations: | ||||||||
Basic | 42,185,163 | 34,405,503 | ||||||
Diluted | 42,185,163 | 35,042,311 |
Thirteen Weeks Ended November 1, 2020 | ||||||||||||||||||||||||||||||||
Common Stock | Paid-In Capital | Treasury Stock At Cost | Accumulated Other Comprehensive Loss | Retained Earnings | Total | |||||||||||||||||||||||||||
Shares | Amt. | Shares | Amt. | |||||||||||||||||||||||||||||
Balance August 2, 2020 | 60,422,212 | $ | 604 | $ | 526,253 | 12,827,300 | $ | (595,728 | ) | $ | (12,077 | ) | $ | 331,319 | $ | 250,371 | ||||||||||||||||
Net loss | — | — | — | — | — | — | (48,043 | ) | (48,043 | ) | ||||||||||||||||||||||
Unrealized foreign currency translation gain | — | — | — | — | — | 34 | — | 34 | ||||||||||||||||||||||||
Unrealized gain on derivatives, net of tax | — | — | — | — | — | 1,370 | — | 1,370 | ||||||||||||||||||||||||
Share-based compensation | — | — | 2,999 | — | — | — | — | 2,999 | ||||||||||||||||||||||||
Issuance of common stock | 61,518 | 1 | 271 | — | — | — | — | 272 | ||||||||||||||||||||||||
Repurchase of common stock | — | — | — | 14,401 | (229 | ) | — | — | (229 | ) | ||||||||||||||||||||||
Balance November 1, 2020 | 60,483,730 | $ | 605 | $ | 529,523 | 12,841,701 | $ | (595,957 | ) | $ | (10,673 | ) | $ | 283,276 | $ | 206,774 | ||||||||||||||||
Thirteen Weeks Ended November 3, 2019 | ||||||||||||||||||||||||||||||||
Common Stock | Paid-In Capital | Treasury Stock At Cost | Accumulated Other Comprehensive Loss | Retained Earnings | Total | |||||||||||||||||||||||||||
Shares | Amt. | Shares | Amt. | |||||||||||||||||||||||||||||
Balance August 4, 2019 | 43,337,125 | $ | 433 | $ | 335,599 | 10,358,291 | $ | (497,862 | ) | $ | (6,647 | ) | $ | 417,779 | $ | 249,302 | ||||||||||||||||
Net income | — | — | — | — | — | — | 482 | 482 | ||||||||||||||||||||||||
Unrealized foreign currency translation gain | — | — | — | — | — | 59 | — | 59 | ||||||||||||||||||||||||
Unrealized loss on derivatives, net of tax | — | — | — | — | — | (1,568 | ) | — | (1,568 | ) | ||||||||||||||||||||||
Share-based compensation | — | — | 1,747 | — | — | — | — | 1,747 | ||||||||||||||||||||||||
Issuance of common stock | 13,360 | 1 | 164 | — | — | — | — | 165 | ||||||||||||||||||||||||
Repurchase of common stock | — | — | 2,425,221 | (97,179 | ) | — | — | (97,179 | ) | |||||||||||||||||||||||
Dividends declared ($0.16 per share) | — | — | — | — | — | — | (4,887 | ) | (4,887 | ) | ||||||||||||||||||||||
Balance November 3, 2019 | 43,350,485 | $ | 434 | $ | 337,510 | 12,783,512 | $ | (595,041 | ) | $ | (8,156 | ) | $ | 413,374 | $ | 148,121 | ||||||||||||||||
Thirty-Nine Weeks Ended November 1, 2020 | ||||||||||||||||||||||||||||||||
Common Stock | Paid-In Capital | Treasury Stock At Cost | Accumulated Other Comprehensive Loss | Retained Earnings | Total | |||||||||||||||||||||||||||
Shares | Amt. | Shares | Amt. | |||||||||||||||||||||||||||||
Balance February 2, 2020 | 43,386,852 | $ | 434 | $ | 339,161 | 12,783,512 | $ | (595,041 | ) | $ | (8,369 | ) | $ | 433,465 | $ | 169,650 | ||||||||||||||||
Net loss | — | — | — | — | — | — | (150,189 | ) | (150,189 | ) | ||||||||||||||||||||||
Unrealized foreign currency translation loss | — | — | — | — | — | (97 | ) | — | (97 | ) | ||||||||||||||||||||||
Unrealized loss on derivatives, net of tax | — | — | — | — | — | (2,207 | ) | — | (2,207 | ) | ||||||||||||||||||||||
Share-based compensation | — | — | 5,344 | — | — | — | — | 5,344 | ||||||||||||||||||||||||
Issuance of common stock | 17,096,878 | 171 | 185,018 | — | — | — | — | 185,189 | ||||||||||||||||||||||||
Repurchase of common stock | — | — | — | 58,189 | (916 | ) | — | — | (916 | ) | ||||||||||||||||||||||
Balance November 1, 2020 | 60,483,730 | $ | 605 | $ | 529,523 | 12,841,701 | $ | (595,957 | ) | $ | (10,673 | ) | $ | 283,276 | $ | 206,774 | ||||||||||||||||
Thirty-Nine Weeks Ended November 3, 2019 | ||||||||||||||||||||||||||||||||
Common Stock | Paid-In Capital | Treasury Stock At Cost | Accumulated Other Comprehensive Loss | Retained Earnings | Total | |||||||||||||||||||||||||||
Shares | Amt. | Shares | Amt. | |||||||||||||||||||||||||||||
Balance February 3, 2019 | 43,177,476 | $ | 432 | $ | 331,255 | 5,655,391 | $ | (297,129 | ) | $ | (683 | ) | $ | 353,962 | $ | 387,837 | ||||||||||||||||
Cumulative effect of a change in accounting principle, net of tax | — | — | — | — | — | — | (145 | ) | (145 | ) | ||||||||||||||||||||||
Net income | — | — | — | — | — | — | 75,281 | 75,281 | ||||||||||||||||||||||||
Unrealized foreign currency translation gain | — | — | — | — | — | 2 | — | 2 | ||||||||||||||||||||||||
Unrealized loss on derivatives, net of tax | — | — | — | — | — | (7,475 | ) | — | (7,475 | ) | ||||||||||||||||||||||
Share-based compensation | — | — | 5,479 | — | — | — | — | 5,479 | ||||||||||||||||||||||||
Issuance of common stock | 173,009 | 2 | 776 | — | — | — | — | 778 | ||||||||||||||||||||||||
Repurchase of common stock | — | — | 7,128,121 | (297,912 | ) | — | — | (297,912 | ) | |||||||||||||||||||||||
Dividends declared ($0.46 per share) | — | — | — | — | — | — | (15,724 | ) | (15,724 | ) | ||||||||||||||||||||||
Balance November 3, 2019 | 43,350,485 | $ | 434 | $ | 337,510 | 12,783,512 | $ | (595,041 | ) | $ | (8,156 | ) | $ | 413,374 | $ | 148,121 | ||||||||||||||||
November 1, | November 3, | |||||||
Cash flows from operating activities: | ||||||||
Net income (loss) | $ | (150,189 | ) | $ | 75,281 | |||
Adjustments to reconcile net income to net cash provided by operating activities: | ||||||||
Depreciation and amortization expense | 104,896 | 97,226 | ||||||
Non-cash interest expense | 4,088 | 0 | ||||||
Impairment of long-lived assets | 13,727 | 0 | ||||||
Deferred taxes | (17,730 | ) | 5,309 | |||||
Loss on disposal of fixed assets | 541 | 1,284 | ||||||
Loss on debt refinance | 904 | 0 | ||||||
Share-based compensation | 5,344 | 5,479 | ||||||
Other, net | 1,292 | 928 | ||||||
Changes in assets and liabilities: | ||||||||
Inventories | 7,745 | (5,305 | ) | |||||
Prepaid expenses | 2,761 | (615 | ) | |||||
Income tax receivable | (42,243 | ) | (996 | ) | ||||
Other current assets | 2,580 | 6,050 | ||||||
Other assets and deferred charges | (3 | ) | (1,775 | ) | ||||
Accounts payable | (11,945 | ) | 5,422 | |||||
Accrued liabilities | 44,742 | 37,671 | ||||||
Income taxes payable | (2,639 | ) | (10,079 | ) | ||||
Other liabilities | 4,375 | 1,909 | ||||||
Net cash provided by (used in) operating activities | (31,754 | ) | 217,789 | |||||
Cash flows from investing activities: | ||||||||
Capital expenditures | (72,604 | ) | (172,888 | ) | ||||
Proceeds from sales of property and equipment | 234 | 615 | ||||||
Net cash used in investing activities | (72,370 | ) | (172,273 | ) | ||||
Cash flows from financing activities: | ||||||||
Proceeds from debt | 688,000 | 366,000 | ||||||
Payments of debt | (760,250 | ) | (104,250 | ) | ||||
Net proceeds from the issuance of common stock | 182,207 | 0 | ||||||
Proceeds from the exercise of stock options | 465 | 778 | ||||||
Repurchase of common stock under share repurchase program | 0 | (297,317 | ) | |||||
Dividends paid | (4,891 | ) | (10,837 | ) | ||||
Debt issuance costs | (16,805 | ) | 0 | |||||
Repurchases of common stock to satisfy employee withholding tax obligations | (916 | ) | (595 | ) | ||||
Net cash provided by (used in) financing activities | 87,810 | (46,221 | ) | |||||
Decrease in cash and cash equivalents | (16,314 | ) | (705 | ) | ||||
Beginning cash and cash equivalents | 24,655 | 21,585 | ||||||
Ending cash and cash equivalents | $ | 8,341 | $ | 20,880 | ||||
Supplemental disclosures of cash flow information: | ||||||||
Decrease in fixed asset accounts payable | $ | (12,315 | ) | $ | (311 | ) | ||
Cash paid (refund received) for income taxes, net | $ | (9,281 | ) | $ | 26,086 | |||
Cash paid for interest, net | $ | 17,306 | $ | 13,920 | ||||
Dividend declared, not paid | $ | 0 | $ | 4,887 |
Fair Value | ||||||||||||
Balance LocationS heet | May 3, 2020 | February 2, 2020 | ||||||||||
Interest rate swaps | Accrued liabilities | $ | (7,920 | ) | $ | (3,518 | ) | |||||
Interest rate swaps | Other liabilities | (10,016 | ) | (6,967 | ) | |||||||
Total derivatives (1) | $ | (17,936 | ) | $ | (10,485 | ) | ||||||
Fair Value | ||||||||||||
Balance Sheet Location | November 1, 2020 | February 2, 2020 | ||||||||||
Interest rate swaps | Accrued liabilities | $ | (8,191 | ) | $ | (3,518 | ) | |||||
Interest rate swaps | Other liabilities | (6,479 | ) | (6,967 | ) | |||||||
Total derivatives (1) | $ | (14,670 | ) | $ | (10,485 | ) | ||||||
(1) | The balance at |
Thirteen Weeks Ended May 3, 2020 | Thirteen Weeks Ended May 5, 2019 | |||||||
Amount of loss recorded in accumulated other comprehensive income | $ | 7,603 | $ | 3,487 | ||||
Amount of loss (gain) reclassified into income (1) | $ | 793 | $ | — | ||||
Income tax benefit of interest rate swaps in accumulated other comprehensive loss | $ | (1,860 | ) | $ | (953 | ) |
Thirteen Weeks Ended | Thirty-Nine Weeks Ended | |||||||||||||||
November 1, 2020 | November 3, 2019 | November 1, 2020 | November 3, 2019 | |||||||||||||
Amount of loss recorded in accumulated other comprehensive income | $ | 0 | 2,483 | $ | 7,602 | 10,623 | ||||||||||
Amount of loss reclassified into income (1) | $ | (1,886 | ) | (326 | ) | $ | (4,566 | ) | (338 | ) | ||||||
Income tax expense (benefit) in accumulated other comprehensive income | $ | 516 | (589 | ) | $ | (829 | ) | (2,810 | ) |
(1) | Amounts reclassified into income are included in “Interest expense, net” in the Consolidated Statements of Comprehensive Income (Loss). |
May 3, 2020 | February 2, 2020 | |||||||
Deferred amusement revenue | $ | 78,409 | $ | 75,113 | ||||
Current portion of operating lease liabilities, net (1) | 59,732 | 45,611 | ||||||
Deferred gift card revenue | 10,796 | 11,253 | ||||||
Rent payable (note 4) | 10,701 | — | ||||||
Compensation and benefits | 9,331 | 23,421 | ||||||
Property taxes | 8,572 | 7,226 | ||||||
Current portion of derivatives | 7,920 | 3,518 | ||||||
Current portion of long-term insurance | 6,500 | 6,500 | ||||||
Utilities | 4,767 | 4,442 | ||||||
Customer deposits | 3,117 | 4,324 | ||||||
Inventory liabilities | 1,937 | 2,179 | ||||||
Variable rent liabilities | 535 | 1,331 | ||||||
Sales and use taxes | 343 | 4,000 | ||||||
Dividend payable | — | 4,891 | ||||||
Other | 18,745 | 13,643 | ||||||
Total accrued liabilities | $ | 221,405 | $ | 207,452 | ||||
November 1, 2020 | February 2, 2020 | |||||||
Deferred amusement revenue | $ | 79,210 | $ | 75,113 | ||||
Current portion of operating lease liabilities, net (1) | 51,850 | 45,611 | ||||||
Rent payable ( Note 4) | 40,542 | — | ||||||
Variable rent liabilities ( Note 4) | 7,559 | 1,331 | ||||||
Deferred gift card revenue | 10,330 | 11,253 | ||||||
Property taxes | 10,285 | 7,226 | ||||||
Compensation and benefits | 9,914 | 23,421 | ||||||
Current portion of derivatives | 8,191 | 3,518 | ||||||
Current portion of long-term insurance | 5,100 | 6,500 | ||||||
Utilities | 4,111 | 4,442 | ||||||
Customer deposits | 1,594 | 4,324 | ||||||
Inventory liabilities | 1,948 | 2,179 | ||||||
Sales and use taxes | 1,160 | 4,000 | ||||||
Dividend payable | — | 4,891 | ||||||
Other | 12,369 | 13,643 | ||||||
Total accrued liabilities | $ | 244,163 | $ | 207,452 | ||||
(1) | The balance of leasehold incentive receivables of |
May 3, 2020 | February 2, 2020 | |||||||
Credit facility—term | $ | 262,500 | $ | 266,250 | ||||
Credit facility—revolver | 489,000 | 382,000 | ||||||
Total debt outstanding | 751,500 | 648,250 | ||||||
Less: | ||||||||
Current installments—term | (15,000 | ) | (15,000 | ) | ||||
Debt issuance costs—term | (1,239 | ) | (561 | ) | ||||
Long-term debt, net | $ | 735,261 | $ | 632,689 | ||||
November 1, 2020 | February 2, 2020 | |||||||
Senior Secured Notes | $ | 550,000 | $ | — | ||||
Credit facility - term | — | 266,250 | ||||||
Credit facility - revolver | 26,000 | 382,000 | ||||||
Total debt outstanding | 576,000 | 648,250 | ||||||
Current installments | — | (15,000 | ) | |||||
Debt issuance costs | (14,185 | ) | (561 | ) | ||||
Long-term debt, net | $ | 561,815 | $ | 632,689 | ||||
Thirteen Weeks | Thirteen Weeks | |||||||
Ended | Ended | |||||||
May 3, 2020 | May 5, 2019 | |||||||
Interest expense on credit facilities | $ | 6,092 | $ | 4,180 | ||||
Amortization of issuance cost | 242 | 198 | ||||||
Interest income | (22 | ) | (26 | ) | ||||
Capitalized interest | (197 | ) | (296 | ) | ||||
Total interest expense, net | $ | 6,115 | $ | 4,056 | ||||
Thirteen Weeks Ended | Thirty-Nine Weeks Ended | |||||||||||||||
November 1, 2020 | November 3, 2019 | November 1, 2020 | November 3, 2019 | |||||||||||||
Interest expense on debt | $ | 6,092 | 5,769 | $ | 17,255 | 14,672 | ||||||||||
Interest associated with swap agreements | 1,886 | 326 | 4,566 | 338 | ||||||||||||
Amortization of issuance cost | 427 | 198 | 1,081 | 594 | ||||||||||||
Interest income | — | (24 | ) | (22 | ) | (75 | ) | |||||||||
Capitalized interest | (192 | ) | (159 | ) | (389 | ) | (758 | ) | ||||||||
Total interest expense, net | $ | 8,213 | $ | 6,110 | $ | 22,491 | $ | 14,771 | ||||||||
May 3, 2020 | May 5, 2019 | |||||||
Operating lease cost | $ | 33,563 | $ | 29,792 | ||||
Variable lease cost | 7,366 | 1,218 | ||||||
Short-term lease cost | 87 | 101 | ||||||
Total lease cost | $ | 41,016 | $ | 31,111 | ||||
Thirteen Weeks Ended | Thirty-Nine Weeks Ended | |||||||||||||||
November 1, 2020 | November 3, 2019 | November 1, 2020 | November 3, 2019 | |||||||||||||
Operating lease cost | $ | 33,278 | 31,489 | $ | 100,162 | 91,729 | ||||||||||
Variable lease cost | 5,351 | 7,692 | 18,405 | 22,335 | ||||||||||||
Short-term lease cost | 102 | 108 | 329 | 324 | ||||||||||||
Total | $ | 38,731 | $ | 39,289 | $ | 118,896 | $ | 114,388 | ||||||||
Thirteen Weeks | Thirteen Weeks | |||||||
Ended | Ended | |||||||
May 3, 2020 | May 5, 2019 | |||||||
Numerator: | ||||||||
Net income (loss) | $ | (43,544 | ) | $ | 42,443 | |||
Denominator: | ||||||||
Weighted average number of common shares outstanding (basic) | 31,829,985 | 36,827,665 | ||||||
Weighted average dilutive impact of equity-based awards (1) | — | 764,279 | ||||||
Weighted average number of common and common equivalent shares outstanding (diluted) | 31,829,985 | 37,591,944 | ||||||
Net income (loss) per share: | ||||||||
Basic | $ | (1.37 | ) | $ | 1.15 | |||
Diluted | $ | (1.37 | ) | $ | 1.13 |
Thirteen Weeks Ended November 1, 2020 | Thirteen Weeks Ended November 3, 2019 | |||||||
Numerator: | ||||||||
Net income (loss) | $ | (48,043 | ) | $ | 482 | |||
Denominator: | ||||||||
Weighted average number of common shares outstanding (basic) | 47,613,741 | 30,980,878 | ||||||
Weighted average dilutive impact of equity-based awards (1) | — | 534,576 | ||||||
Weighted average number of common and common equivalent shares outstanding (diluted) | 47,613,741 | 31,515,454 | ||||||
Net income (loss) per share: | ||||||||
Basic | $ | (1.01 | ) | $ | 0.02 | |||
Diluted | $ | (1.01 | ) | $ | 0.02 | |||
Thirty-Nine Weeks Ended November 1, 2020 | Thirty-Nine Weeks Ended November 3, 2019 | |||||||
Numerator: | ||||||||
Net income (loss) | $ | (150,189 | ) | $ | 75,281 | |||
Denominator: | ||||||||
Weighted average number of common shares outstanding (basic) | 42,185,163 | 34,405,503 | ||||||
Weighted average dilutive impact of equity-based awards (1) | — | 636,808 | ||||||
Weighted average number of common and common equivalent shares outstanding (diluted) | 42,185,163 | 35,042,311 | ||||||
Net income (loss) per share: | ||||||||
Basic | $ | (3.56 | ) | $ | 2.19 | |||
Diluted | $ | (3.56 | ) | $ | 2.15 |
(1) | Due to |
Thirteen Weeks Ended | ||||||||
May 3, | May 5, | |||||||
Stock options | $ | 540 | 759 | |||||
RSU’s and restricted stock | (929 | ) | 1,066 | |||||
Total share-based compensation expense | $ | (389 | ) | $ | 1,825 | |||
Thirteen Weeks Ended | Thirty-Nine Weeks Ended | |||||||||||||||
November 1, 2020 | November 3, 2019 | November 1, 2020 | November 3, 2019 | |||||||||||||
Stock options | $ | 269 | 731 | $ | 1,099 | 2,294 | ||||||||||
RSU’s | 2,730 | 1,016 | 4,245 | 3,185 | ||||||||||||
Share-based compensation expense | $ | 2,999 | $ | 1,747 | $ | 5,344 | $ | 5,479 | ||||||||
2014 Stock Incentive Plan | 2010 Stock Incentive Plan | |||||||||||||||
Number of Options | Weighted Average Exercise Price | Number of Options | Weighted Average Exercise Price | |||||||||||||
Outstanding at February 2, 2020 | 1,323,495 | $ | 36.97 | 266,900 | $ | 6.72 | ||||||||||
Granted | — | — | — | — | ||||||||||||
Exercised | — | — | (9,244 | ) | 4.74 | |||||||||||
Forfeited | (17,620 | ) | 49.21 | — | — | |||||||||||
Outstanding at May 3, 2020 | 1,305,875 | $ | 36.80 | 257,656 | $ | 6.79 | ||||||||||
Exercisable at May 3, 2020 | 1,097,556 | $ | 34.47 | 257,656 | $ | 6.79 | ||||||||||
2014 Stock Incentive Plan | 2010 Stock Incentive Plan | |||||||||||||||
Number of Options | Wtd. Avg. Exercise Price | Number of Options | Wtd. Avg. Exercise Price | |||||||||||||
Outstanding at February 2, 2020 | 1,323,495 | $ | 36.97 | 266,900 | $ | 6.72 | ||||||||||
Granted | — | — | — | — | ||||||||||||
Exercised | — | — | (90,391 | ) | 5.14 | |||||||||||
Forfeited | (84,395 | ) | 38.79 | — | — | |||||||||||
Outstanding at November 1, 2020 | 1,239,100 | $ | 36.84 | 176,509 | $ | 7.54 | ||||||||||
Exercisable at November 1, 2020 | 1,047,124 | $ | 34.64 | 176,509 | $ | 7.54 | ||||||||||
Shares | Weighted Average Fair Value | |||||||
Outstanding at February 2, 2020 | 216,815 | $ | 51.58 | |||||
Granted | 72,593 | 12.85 | ||||||
Vested | (19,344 | ) | 51.68 | |||||
Forfeited | (18,455 | ) | 47.45 | |||||
Outstanding at May 3, 2020 | 251,609 | $ | 40.70 | |||||
Shares | Wtd. Avg. Fair Value | |||||||
Outstanding at February 2, 2020 | 216,815 | $ | 51.58 | |||||
Granted | 1,063,209 | 12.74 | ||||||
Change in performance units | 4,352 | 59.67 | ||||||
Vested | (102,595 | ) | 38.11 | |||||
Forfeited | (50,736 | ) | 27.72 | |||||
Outstanding at November 1, 2020 | 1,131,045 | $ | 17.39 | |||||
Item 2. | Management’s Discussion and Analysis of Financial Condition and Results of Operations |
managers. In addition, effective March 24, 2020, the Company furloughed all but a small team of essential corporate and administrative staff, enacted 12-week salary reductions ranging from 10% to 50%, and suspended all cash board fees through the remainder of fiscal 2020. As stores reopen with a reduced workforce a portion of the furloughed personnel at our stores and corporate office have returned to work; |
Thirteen Weeks Ended May 3, 2020 | Thirteen Weeks Ended May 5, 2019 | |||||||||||||
Food and beverage revenues | $ 63,920 | 40.0 | % | $ | 148,221 | 40.8 | % | |||||||
Amusement and other revenues | 95,886 | 60.0 | 215,361 | 59.2 | ||||||||||
Total revenues | 159,806 | 100.0 | 363,582 | 100.0 | ||||||||||
Cost of food and beverage (as a percentage of food and beverage revenues) | 17,344 | 27.1 | 38,754 | 26.1 | ||||||||||
Cost of amusement and other (as a percentage of amusement and other revenues) | 10,728 | 11.2 | 22,971 | 10.7 | ||||||||||
Total cost of products | 28,072 | 17.6 | 61,725 | 17.0 | ||||||||||
Operating payroll and benefits | 43,737 | 27.4 | 82,873 | 22.8 | ||||||||||
Other store operating expenses | 95,672 | 59.8 | 106,245 | 29.2 | ||||||||||
General and administrative expenses | 14,563 | 9.1 | 16,846 | 4.6 | ||||||||||
Depreciation and amortization expense | 35,352 | 22.1 | 31,141 | 8.6 | ||||||||||
Pre-opening costs | 3,823 | 2.4 | 7,002 | 1.9 | ||||||||||
Total operating costs | 221,219 | 138.4 | 305,832 | 84.1 | ||||||||||
Operating income (loss) | (61,413) | (38.4 | ) | 57,750 | 15.9 | |||||||||
Interest expense, net | 6,115 | 3.9 | 4,056 | 1.1 | ||||||||||
Income (loss) before provision (benefit) for income taxes | (67,528) | (42.3 | ) | 53,694 | 14.8 | |||||||||
Provision (benefit) for income taxes | (23,984) | (15.1) | 11,251 | 3.1 | ||||||||||
Net income (loss) | $ (43,544) | (27.2 | )% | $ | 42,443 | 11.7 | % | |||||||
Change in comparable store sales (1) | (58.6 | )% | (0.3 | )% | ||||||||||
Company-owned stores at end of period (1) | 137 | 127 | ||||||||||||
Comparable stores at end of period (1) | 116 | 99 |
Thirteen Weeks Ended November 1, 2020 | Thirteen Weeks Ended November 3, 2019 | |||||||||||||||
Food and beverage revenues | $ | 38,346 | 35.2 | % | $ | 124,637 | 41.6 | % | ||||||||
Amusement and other revenues | 70,706 | 64.8 | 174,715 | 58.4 | ||||||||||||
Total revenues | 109,052 | 100.0 | 299,352 | 100.0 | ||||||||||||
Cost of food and beverage (as a percentage of food and beverage revenues) | 10,664 | 27.8 | 33,384 | 26.8 | ||||||||||||
Cost of amusement and other (as a percentage of amusement and other revenues) | 7,244 | 10.2 | 18,796 | 10.8 | ||||||||||||
Total cost of products | 17,908 | 16.4 | 52,180 | 17.4 | ||||||||||||
Operating payroll and benefits | 27,704 | 25.4 | 76,165 | 25.4 | ||||||||||||
Other store operating expenses | 70,783 | 64.9 | 110,713 | 37.1 | ||||||||||||
General and administrative expenses | 11,746 | 10.8 | 16,210 | 5.4 | ||||||||||||
Depreciation and amortization expense | 34,384 | 31.5 | 33,340 | 11.1 | ||||||||||||
Pre-opening costs | 2,570 | 2.4 | 4,245 | 1.4 | ||||||||||||
Total operating costs | 165,095 | 151.4 | 292,853 | 97.8 | ||||||||||||
Operating income (loss) | (56,043 | ) | (51.4 | ) | 6,499 | 2.2 | ||||||||||
Interest expense, net | 8,213 | 7.6 | 6,110 | 2.1 | ||||||||||||
Loss on debt refinance | 904 | 0.8 | — | — | ||||||||||||
Income (loss) before benefit for income taxes | (65,160 | ) | (59.8 | ) | 389 | 0.1 | ||||||||||
Benefit for income taxes | (17,117 | ) | (15.7 | ) | (93 | ) | (0.1 | ) | ||||||||
Net income (loss) | $ | (48,043 | ) | (44.1 | )% | $ | 482 | 0.2 | % | |||||||
Change in comparable store sales (1) | (65.6 | )% | (4.1 | )% | ||||||||||||
Company-owned stores at end of period (1) | 137 | 134 | ||||||||||||||
Comparable stores at end of period (1) | 114 | 99 |
(1) As | of the end of the re-open. Our store in Duluth (Atlanta), Georgia permanently closed on March 3, 2019 as we did not exercise the renewal option and |
Thirteen Weeks Ended May 3, 2020 | Thirteen Weeks Ended May 5, 2019 | |||||||||||||||
Net income (loss) | $ | (43,544 | ) | -27.2 | % | $ | 42,443 | 11.7 | % | |||||||
Interest expense, net | 6,115 | 4,056 | ||||||||||||||
Provision (benefit) for income taxes | (23,984 | ) | 11,251 | |||||||||||||
Depreciation and amortization expense | 35,352 | 31,141 | ||||||||||||||
EBITDA | (26,061 | ) | -16.3 | % | 88,891 | 24.4 | % | |||||||||
Loss on asset disposal | 153 | 420 | ||||||||||||||
Impairment of long-lived assets | 11,549 | — | ||||||||||||||
Share-based compensation | (389 | ) | 1,825 | |||||||||||||
Pre-opening costs | 3,823 | 7,002 | ||||||||||||||
Other costs (1) | 147 | 46 | ||||||||||||||
Adjusted EBITDA | $ | (10,778 | ) | -6.7 | % | $ | 98,184 | 27.0 | % | |||||||
Thirteen Weeks Ended November 1, 2020 | Thirteen Weeks Ended November 3, 2019 | |||||||||||||||
Net income (loss) | $ | (48,043 | ) | -44.1 | % | $ | 482 | 0.2 | % | |||||||
Interest expense, net | 8,213 | 6,110 | ||||||||||||||
Loss on debt refinance | 904 | — | ||||||||||||||
Benefit for income taxes | (17,117 | ) | (93 | ) | ||||||||||||
Depreciation and amortization expense | 34,384 | 33,340 | ||||||||||||||
EBITDA | (21,659 | ) | -19.9 | % | 39,839 | 13.3 | % | |||||||||
Loss on asset disposal | 124 | 458 | ||||||||||||||
Share-based compensation | 2,999 | 1,747 | ||||||||||||||
Pre-opening costs | 2,570 | 4,245 | ||||||||||||||
Other costs (1) | (5 | ) | 1 | |||||||||||||
Adjusted EBITDA | $ | (15,971 | ) | -14.6 | % | $ | 46,290 | 15.5 | % | |||||||
(1) | Primarily represents costs related to currency transaction (gains) or losses. |
Thirteen Weeks Ended May 3, 2020 | Thirteen Weeks Ended May 5, 2019 | |||||||||||||||
Operating income (loss) | $ | (61,413 | ) | -38.4 | % | $ | 57,750 | 15.9 | % | |||||||
General and administrative expenses | 14,563 | 16,846 | ||||||||||||||
Depreciation and amortization expense | 35,352 | 31,141 | ||||||||||||||
Pre-opening costs | 3,823 | 7,002 | ||||||||||||||
Store Operating Income Before Depreciation and Amortization | $ | (7,675 | ) | -4.8 | % | $ | 112,739 | 31.0 | % | |||||||
Thirteen Weeks Ended November 1, 2020 | Thirteen Weeks Ended November 3, 2019 | |||||||||||||||
Operating income (loss) | $ | (56,043 | ) | -51.4 | % | $ | 6,499 | 2.2 | % | |||||||
General and administrative expenses | 11,746 | 16,210 | ||||||||||||||
Depreciation and amortization expense | 34,384 | 33,340 | ||||||||||||||
Pre-opening costs | 2,570 | 4,245 | ||||||||||||||
Store Operating Income Before Depreciation and Amortization | $ | (7,343 | ) | -6.7 | % | $ | 60,294 | 20.1 | % | |||||||
Thirteen Weeks Ended May 3, 2020 | Thirteen Weeks Ended May 5, 2019 | |||||||
New store and operating initiatives | $ | 37,046 | $ | 51,418 | ||||
Games | 7,908 | 3,696 | ||||||
Maintenance capital | 2,497 | 6,295 | ||||||
Total capital additions | $ | 47,451 | $ | 61,409 | ||||
Payments from landlords | $ | — | $ | 14,242 |
Thirteen Weeks Ended November 1, 2020 | Thirteen Weeks Ended November 3, 2019 | |||||||
New store and operating initiatives | $ | 7,700 | $ | 52,147 | ||||
Games | 361 | 2,825 | ||||||
Maintenance capital | 1,208 | 5,831 | ||||||
Total capital additions | $ | 9,269 | $ | 60,803 | ||||
Payments from landlords | $ | 4,709 | $ | 7,240 |
FY2020 | FY2019 | |||||||||||||||||||||||
4 week period ending 3/1/20 | 9 week period ending 5/3/20 | Total | 4 week period ending 3/3/19 | 9 week period ending 5/5/19 | Total | |||||||||||||||||||
Revenues | $ | 115,491 | $ | 44,315 | $ | 159,806 | $ | 115,120 | $ | 248,462 | $ | 363,582 | ||||||||||||
Store operating weeks | 544 | 289 | 833 | 490 | 1,126 | 1,616 | ||||||||||||||||||
Stores open at end of period | 136 | 1 | 122 | 127 |
Thirteen weeks ended November 1, 2020 | Thirteen weeks ended November 3, 2019 | Change | ||||||||||
Total revenues | $ | 109,052 | $ | 299,352 | $ | (190,300 | ) | |||||
Total store operating weeks | 1,221 | 1,722 | (501 | ) | ||||||||
Comparable store revenues | $ | 89,592 | $ | 260,131 | $ | (170,539 | ) | |||||
Comparable store operating weeks | 993 | 1,482 | (489 | ) | ||||||||
Noncomparable store revenues | $ | 20,092 | 40,131 | $ | (20,039 | ) | ||||||
Noncomparable store operating weeks | 228 | 240 | (12 | ) | ||||||||
Other revenues | $ | (632 | ) | $ | (910 | ) | $ | 278 |
Thirty-Nine Weeks Ended November 1, 2020 | Thirty-Nine Weeks Ended November 3, 2019 | |||||||||||||||
Food and beverage revenues | $ | 119,268 | 37.3 | % | $ | 410,779 | 40.8 | % | ||||||||
Amusement and other revenues | 200,423 | 62.7 | 596,754 | 59.2 | ||||||||||||
Total revenues | 319,691 | 100.0 | 1,007,533 | 100.0 | ||||||||||||
Cost of food and beverage (as a percentage of food and beverage revenues) | 32,667 | 27.4 | 109,072 | 26.6 | ||||||||||||
Cost of amusement and other (as a percentage of amusement and other revenues) | 21,997 | 11.0 | 64,456 | 10.8 | ||||||||||||
Total cost of products | 54,664 | 17.1 | 173,528 | 17.2 | ||||||||||||
Operating payroll and benefits | 85,197 | 26.6 | 239,965 | 23.8 | ||||||||||||
Other store operating expenses | 229,137 | 71.8 | 321,334 | 31.9 | ||||||||||||
General and administrative expenses | 35,587 | 11.1 | 49,047 | 4.9 | ||||||||||||
Depreciation and amortization expense | 104,896 | 32.8 | 97,226 | 9.6 | ||||||||||||
Pre-opening costs | 8,781 | 2.7 | 15,970 | 1.6 | ||||||||||||
Total operating costs | 518,262 | 162.1 | 897,070 | 89.0 | ||||||||||||
Operating income (loss) | (198,571 | ) | (62.1 | ) | 110,463 | 11.0 | ||||||||||
Interest expense, net | 22,491 | 7.0 | 14,771 | 1.5 | ||||||||||||
Loss on debt refinance | 904 | 0.3 | — | — | ||||||||||||
Income (loss) before provision (benefit) for income taxes | (221,966 | ) | (69.4 | ) | 95,692 | 9.5 | ||||||||||
Provision (benefit) for income taxes | (71,777 | ) | (22.4 | ) | 20,411 | 2.0 | ||||||||||
Net income (loss) | $ | (150,189 | ) | (47.0 | ) | $ | 75,281 | 7.5 | % | |||||||
Change in comparable store sales (1) | (70.2 | )% | (1.9 | )% | ||||||||||||
Company-owned stores at end of period (1) | 137 | 134 | ||||||||||||||
Comparable stores at end of period (1) | 114 | 99 |
(1) | As of the end of the third quarter of fiscal 2020, 104 of our 137 stores were open and 84 of our 114 comparable stores were open. Our total and comparable store counts as of the end of the third quarter of fiscal 2020 exclude a store in Chicago, Illinois and a store in Houston, Texas which are near the end of their respective lease terms which the Company has decided not to re-open. Our store in Duluth (Atlanta), Georgia permanently closed on March 3, 2019 as we did not exercise the renewal option and has been excluded from fiscal 2019 store counts and comparable store sales. |
Thirty-Nine Weeks Ended November 1, 2020 | Thirty-Nine Weeks Ended November 3, 2019 | |||||||||||||||
Net income (loss) | $ | (150,189 | ) | -47.0 | % | $ | 75,281 | 7.5 | % | |||||||
Interest expense, net | 22,491 | 14,771 | ||||||||||||||
Loss on debt refinance | 904 | — | ||||||||||||||
Provision (benefit) for income taxes | (71,777 | ) | 20,411 | |||||||||||||
Depreciation and amortization expense | 104,896 | 97,226 | ||||||||||||||
EBITDA | (93,675 | ) | -29.3 | % | 207,689 | 20.6 | % | |||||||||
Loss on asset disposal | 541 | 1,284 | ||||||||||||||
Impairment of long-lived assets | 13,727 | — | ||||||||||||||
Share-based compensation | 5,344 | 5,479 | ||||||||||||||
Pre-opening costs | 8,781 | 15,970 | ||||||||||||||
Other costs (1) | 54 | 34 | ||||||||||||||
Adjusted EBITDA | $ | (65,228 | ) | -20.4 | % | $ | 230,456 | 22.9 | % | |||||||
(1) | Primarily represents costs related to currency transaction (gains) or losses. |
Thirty-Nine Weeks Ended November 1, 2020 | Thirty-Nine Weeks Ended November 3, 2019 | |||||||||||||||
Operating income (loss) | $ | (198,571 | ) | -62.1 | % | $ | 110,463 | 11.0 | % | |||||||
General and administrative expenses | 35,587 | 49,047 | ||||||||||||||
Depreciation and amortization expense | 104,896 | 97,226 | ||||||||||||||
Pre-opening costs | 8,781 | 15,970 | ||||||||||||||
Store Operating Income Before Depreciation and Amortization | $ | (49,307 | ) | -15.4 | % | $ | 272,706 | 27.1 | % | |||||||
Thirty-Nine Weeks Ended November 1, 2020 | Thirty-Nine Weeks Ended November 3, 2019 | |||||||
New store and operating initiatives | $ | 48,222 | $ | 143,594 | ||||
Games | 9,079 | 12,667 | ||||||
Maintenance capital | 2,988 | 16,316 | ||||||
Total capital additions | $ | 60,289 | $ | 172,577 | ||||
Payments from landlords | $ | 8,723 | $ | 28,581 |
Thirty-nine weeks ended November 1, 2020 | Thirty-nine weeks ended November 3, 2019 | Change | ||||||||||
Total revenues | $ | 319,691 | $ | 1,007,533 | $ | (687,842 | ) | |||||
Total store operating weeks | 2,682 | 5,012 | (2,330 | ) | ||||||||
Comparable store revenues | $ | 268,426 | $ | 901,837 | $ | (633,411 | ) | |||||
Comparable store operating weeks | 2,184 | 4,446 | (2,262 | ) | ||||||||
Noncomparable store revenues | $ | 54,763 | $ | 110,231 | $ | (55,468 | ) | |||||
Noncomparable store operating weeks | 498 | 566 | (68 | ) | ||||||||
Other revenues | $ | (3,498 | ) | $ | (4,535 | ) | $ | 1,037 |
Total | 1 Year | 2-3 Years | 4-5 Years | After 5 Years | ||||||||||||||||
Senior Secured Notes | $ | 550,000 | $ | — | $ | — | $ | 550,000 | $ | — | ||||||||||
Credit Facility - Revolver (1) | 26,000 | — | — | 26,000 | — | |||||||||||||||
Interest requirements (2) | 225,395 | 46,328 | 91,087 | 87,980 | — | |||||||||||||||
Total | $ | 801,395 | $ | 46,328 | $ | 91,087 | $ | 663,980 | $ | — | ||||||||||
(1) | Available commitments under the revolving credit facility were $464,314 as of November 1, 2020, subject to a $150,000 liquidity covenant. |
(2) | The cash obligations for the variable portion of the interest requirements on the outstanding balance of the revolving credit facility and the unused commitment are based on an interest rate of 6.00% and 0.50%, respectively, through the end of the first quarter of fiscal year 2022, reduced to 4.00% and 0.40%, respectively, for the remainder of the term of the credit facility. The interest requirement on the Notes is based on a fixed rate of 7.625%. |
Item 3. | Quantitative and Qualitative Disclosures About Market Risk |
Item 4. | Controls and Procedures |
Item 1. | Legal Proceedings |
Item 1A. | Risk Factors |
Item 2. | Unregistered Sales of Equity Securities and Use of Proceeds |
Item 6. | Exhibits |
Exhibit Number | Description | |||
10.1* | ||||
31.1* | ||||
31.2* | ||||
32.1* | ||||
32.2* | ||||
101 | ||||
XBRL Interactive Data files | ||||
104 | ||||
Cover Page Interactive Data File (formatted as inline XBRL and contained in Exhibit 101). |
* | Filed herein |
DAVE & BUSTER’S ENTERTAINMENT, INC., a Delaware corporation | ||||||
Date: December 10, 2020 | ||||||
By: | /s/ Brian A. Jenkins | |||||
Brian A. Jenkins | ||||||
Chief Executive Officer |
Date: December 10, 2020 | ||||||||
By: | /s/ Scott J. Bowman | |||||||
Scott J. Bowman | ||||||||
Chief Financial Officer |