DS - Earnings call transcript Q2 2022

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Operator

Good morning. My name is Gretchen, and I will be your conference operator today. At this time, I would like to welcome everyone to Drive Shack's Second Quarter 2022 Earnings Conference Call. Currently, all lines have been placed on mute to prevent any background noise. after the prepared remarks, you will have a question-and-answer session. is call Today's Instructions] being recorded. [Operator At the call Instructions] this CFO. time, hand to like would over I [Operator to Buchhorn, Kelley Ms. Buchhorn, you may begin.

Kelley Buchhorn

welcome and I'd Inc.'s Gretchen, morning, quarter you to second call. you, Shack to earnings Thank XXXX Drive good like everyone.

statements. chance today call the haven't Actual now investor Officer, with supplement the take review the and point President I'd the to these and you review to filed by results a do ir.driveshack.com. presentation the Please our you in Investor that, to moment like quarterly the Hana to on risk include disclaimers Chief reports a remarks call I'd We've factors to download and considered Khouri. to forward-looking contained now already. the me if like press may had that our is investor out Joining materially at those in made annual SEC. to and posted and encourage supplement Hana. from statements, will with Executive so today over we our turn And Relations differ release website to certain

Hana Khouri

Kelley. today. joining Good for us morning, Thanks, everyone. Thanks

we results in up brand reflect quarter sales strong to or XX% $XX the million entire last $XX Our across see total QX our portfolio. momentum year. nearly this delivered revenue, We continue million company to compared

with driven events. American in courses Golf XX delivering by solid for in same our million at $X.X coming business total above million strong remains revenue, Our last core $XX year's demand quarter,

business just total drove year, slightly revenue million million, Shack over while Drive a with down $XX in $X they delivered quarter. venues event just last of over this four Our strong events revenue versus and

with deliver which gain proof-of-concept our to in line continue Puttery, continues expectations. We to with results

combined of total For Colony two million. Charlotte in The $X.X revenue venues generated and QX, our

second which QX June more $XX days seen significantly located quarter. is D.C.'s future the generated was opened million categories Quarter translate EBITDA event $XXX,XXX increase Adjusted the at which in on into XX year, corporate few both was with the related last the growth and events the was in year. last Our for to with made $X this in was opened We've and than of American it development expected investments below the private other the revenue support in the quarter and across demand rise, to the public social $X in over Puttery. second revenue expenses $XX Golf. half at newest Puttery million quarter, from for Penn up continue and million $X.X year's and Total headcount strong sales was million of above to which coming we've event will the million, strategic back to in just results for

venues core our American and in foundation strong Golf Drive our a have exceptional Shack results. continues each courses We and with business to deliver

pleased performance X. venues, been of the for Puttery Colony, XX and has now extremely are which has opened We with open The been which for months, Charlotte, our two

expected ahead within the of entertainment range. these of plan business. venue-based generating both large delivering well their clear margins concept two results slightly in Our proof market unit venues, a and with addressable the is profitability sales There's economic

are Kansas represents new opening Houston expect a the We Puttery now of as to towards of Pittsburgh City of with invest XXXX We in for growth. additional Chicago and early to QX QX. end venues development near Behind the and capital openings late continue QX. new path by the Puttery planned in term open these, best total in forward four

openings operating. pushed venue early we delays with zoning are dates Unexpected national to leases Miami new in will XXXX speak and this to a in I'll venues partnered together, moments. a We a XXXX. and broker, just pursuing beyond. seven of few have permitting end recently and licensing We've for aggressively opening and more total Puttery XXXX the new and both with Manhattan of open

of a Orleans. longer As development our Shack venue Drive reminder, last quarter no New in we made decision to the pursue the

of lease with termination XX, effective right-of-use we when and to we a coupled agreement rights year, removed sheet. longer lease Manhattan from $X we've million use premises. Drive June to the our and entered our associated this continue we site above fees Shack our liabilities and QX Drive with During into Randall's with And plan landlord Island the deliver the that, venue this will EBITDA it With have no lease, on and in the balance well believe asset XXXX, terminations associated the We venues. margins sales quarter. net exit a of developing current Shack recorded loss to on the any

So turning the deck. to

you Shack will operating an to entertainment see traditional Page As X, the has transformation Inc. a four last significant on years. Drive business golf undergone from during company

of we last since Beach in Puttery developed Raleigh, September The Orlando. our owned courses entertainment newest four to today business of portfolio, managed a development course Dallas into During year. and number Drive and using in venues golf our our We've in golf fund opening the growth experience entertainment first this our of the Shack the that operate and Richmond, of Palm sold Colony converting just them the Puttery, West we of time, with proceeds outside help majority

ago Our XXXX DC's in June. second Charlotte most zone weeks mid-December few Penn entertainment of premier and recently in in opened in late a Quarter, venue

XX meeting to of our goals underway Puttery are XXXX. by We of open venues end the total a to

courses and now to summary Page and Turning for of a X view timeline venues. our

one states business, leased end nine and Golf courses. we of across with side American managed owned, On of XX QX the XX at held our XX courses the

mentioned, entertainment As golf and I Richmond currently venues four Shack Palm. we Drive in Raleigh, have Orlando, located just West

on Kansas With to these, today committed of We Houston, we open open to XXXX. operate we Colony, one Manhattan venue-based Randall's the are remaining late venue well our and those to The and to early lease Charlotte eight and Behind expected Miami, this year. with Chicago, planned earlier Minneapolis. D.C. in Manhattan and for Island, leases the announced located meat newest four The in as morning large include later currently we Pittsburgh committed a three City have market addressable four packing venues There which in entertainment as for district located Philadelphia to in in additional our Puttery, open expect venues this XXXX are in -- is additional venue in business. venue-based

speak Puttery moments. future We plans we robust for several a of across in in and I'll are updated a to our the few openings have pipeline markets development beyond. in pursuing aggressively more timeline and XXXX U.S. locations

financial X. Page to now our strategy turn on Let's

growth Puttery Randall's and new term develop to Drive capital-intensive. near Our strategy Shack venues Island is

and the expenditure growth with Puttery. We strong financing level a will alternatives to Based future operations operations sufficient and the flows our other requirements. available balance working need of funding to from the and while current cash growth, will meet combined sheet of be retain anticipated we that balance on capital expect development capital

fund pipeline explore capital continue financing liquidity to to markets and current expect to debt the actively through We our our needs. meet

well it through the strategically Our our optimizing objectives include potential under estate diversifying makes right monetizing And real financial sales for remaining circumstances, new as where debt financing asset the securities. sense. sources as

providing our objectives have us path more as to We you maintaining sheet. update enables to meet share. a continue while we actively soon to that an growth information pursue forward balance We healthy a as to look

our celebrating most away opened its nearly of month the venue Colony Starting is Quarter We update been our to have about an in X-year Puttery Page The to from first DC's on XX now It's venues venues believe hard with a recent days Moving of XX business. in. about that for operations currently the on three open Charlotte now, our Puttery has months in open. and Penn anniversary. is that deck. eight

for Given of quarter, open that in we their are days results a providing D.C. the was only full here. not handful

in our also their to of with note which lead normalizing. on business, convert sales driven sales total a between in QX this date. expenses, our closer business Events outlined at for that performing the It's QX. their both give the ahead both that in The D.C. of captured we higher at and each event The our Colony. that Again, the million revenue as $X.X as declines $X.X was to EBITDA million, reiterate important update for revenue related Charlotte around had venue. with see inventory at is you to impact to a The another. continue process are this Colony Charlotte life-to-date of Colony revenue to sales result online mix teams in line is On who recorded plan Charlotte. our Colony margins $X spend of me to I'll effect quarter breakdown are our are The including Colony I The as sales. advance We've which visit recap The EBITDA QX quarter as location at feeding $X.X few how total to relatively quick onetime in locations basis with drive via no and line to revenue a walk-in and prospects million, adjustment both was similar $X.X quarter of want they year-to-date in delivering was on XX%, Charlotte's The this have versus the but now and this As both their system over Colony business expectations XX. through QX. visit hold is to direct venue which in than appropriate Dallas here the continues XX% directly $X.X Page trends perform our venues, event booked continue and of payroll, across business million. in for let see event a million into continue which QX, was is true-up information related on total to this took QX one continue to margin to cost Taking into were operating generating F&B our reservation market differences, since the $X a point-of-sale walk-in quickly point-of-sale Walk-in correction slide, with and how with moments, million per look in root leverage their conversions a delivered guests our system, the system Charlotte. million, cause a platform delivered variable events. largely in each our being point-of-sale of made continues is and designed. revenue inventory identified walk-in their Charlotte only by even higher

of liquor and close via have likely were require of lodge, than or or two XX We venue-based rooftop seeing the courses given held per of their courses, four the F&B that higher around time up sizes date pro XX% as so visit out believe to Today, minutes an illusion. at revenue. Likewise, only conservatory. could as The play number e-mail about been learn in they years in wine to Colony, will total higher entertainment the that higher than the spend and currently. even of on us this higher booked confidence a and online sales The we by guest addressable reservations that profitability giving venue average Charlotte's even deliver will name fully margin Charlotte both solid visit spend we with over in Colony date forward to reservation. The similar date, will show the guest family performance The support courses Charlotte number that has has concepts well forma is to trend largely handful is new Gameplay per over beer to is visitors play that today across us of and as guest to needs advance and and for have is huge we comprise repeat The courses, XX% date an been driven around relatively Charlotte. venues XX XX% market, up online event guest. X-hole the size first venues and intentional minutes with total to optimize one numbers over For as venue of when from steady library as ago, of just first-time business scale. size Colony per trended return The of of of our two and we build F&B one which Colony experimenting returns. we not at we economics if the one may that X-hole first library, walk-in put our Again, reservation friends prove and continues their different to best to reservations. mix XX% are who a better courses. number one the future more we're Puttery to results, a

and forward I a We while over for and Quarter now, We metrics it you. near clear growth share now gaining to opened for end been Penn month the want with are profitability. some the and Puttery Puttery near our newest brand our presents proof-of-concept to a early our term only best open they've in path of just June D.C.'s

Looking Page XX% on generated from alone. at for sales in first XX-plus days, graphic alcohol D.C. the total around XX, has revenue beverage with $XXX,XXX and their

are to with Charlotte The trends seeing similar at very online and We XX%. trending Colony reservations

the to minutes F&B courses, building one and former in in D.C. is historic advance, who just home the and International an their plan and spend in their Puttery sales For visit a of is of those game XX% of the time easy three of illusion. Museum. XX alcohol/liquor total under Spy conservatory average play at beautiful are

As building, the with structure to site. limited any the were historic core we of

has Our unique integrates throughout design plenty teams The laying areas did an and with of our building well characteristics, throughout. very and lounge incredibly design with venue the nicely which venue out seating of blends flow the elements. amazing the job

the as the feel the view the vibe a well few you, pictures step newest themed our for Museum. moment You door. inside as definitely shown of from course, including Art you the building here the outside the showcasing and through We've

D.C. this opportunity in out please the person. area If to venue future, carve visit you get to the time the visit in

You be disappointed. won't definitely

Moving now on Drive Shack Page to XX. our business

events event of in Our four million million year. year. $X.X $XXX,XXX $XX quarter with versus revenue last down in last for venues or just this last this year, QX of All generated revenue QX higher to this year $X.X We the revenue quarter year. venues million, total double posted over four strong of in versus saw QX event compared in of same up demand revenue

walk-in all not just to dynamics fully was to a into pullback the to we Separately, offset outperform team year. brand We've of initiatives have the been Raleigh it total, our to driven revenue. $X venues, by see business. to a the revenue of in strong business. in we increased continues in head However, the decline assessing and dedicated awareness drive million quite continue quarter a and enough market half as Richmond's walk-in and this implementing events back lead

$X.X results to year. perform We or Drive up and basis, QX venue monitor with sales last down this up compared XX% group West a Orlando EBITDA period year-to-date year-to-date of Shack same XX% right in was Raleigh, versus Palm with once future year-to-date $XXX,XXX million, of and period to year. versus last the continues the closely, we'll led the just EBITDA well updates on last combined total calls. On $X.X EBITDA and behind. provide again, $XXX,XXX revenue continue and or for QX to year. venue million was million $X.X sales of $XXX,XXX

us. events, continue with their Our are demand strong, the or them to at a we us expect with for -- in increasing above stable And venues Drive rate run business projections. Shack delivering

be continues strong business Golf stable as generate year-over-year. and and American continues very business earnings to well, which to Our returns profitable a

our second you QX here excluding was up was to quarter. up the revenue over As Page from with we just also our in see to high this in or year. doing our large last the million fee courses. can for rates year's versus continues million, revenue continued momentum management increase across demand, remain team increase events for $XX conversion opportunity focused an in of XX% American over business Tournaments came driven growth. see higher QX Golf's XXX% and The XX, events as from events and $X revenue on work primarily event last part is total The

this of QX million, year's levels. was $X.X in below business down walk-in million last slightly Our year QX $XX at

place were all the strong golf up While levels outdoor given courses when extremely metrics, for that for our across traditional COVID high indoor relatively quarter restrictions we last still demand was were were private public just activities. below year's in last year against a and

a total to high continue rate at We maintain across private XX% capacity. our clubs membership

that With with to alike. solid we golf believe the performance courses of momentum our continued remains deliver, non-golfers from golfers solid game and the

states development now large for business, capitalize we where for locations. to we've we of A exists and maintain our XX, we continue country this our Page as at representation Let's look where venue the we term market a as move on well scale to a large exists the entertainment development visual have openings. golf Puttery plans. Puttery opportunity addressable believe you existing When and focus venue-based on out opportunity new an plans future entertainment near across location as laid

Our broker markets we've that enabling experienced and under the the for new choose. are met. and Together, with a country barrier across highly XX around an to potential We to knowledgeable that developed identify recently our target us coverage in current partnered site will today across of nimble be includes markets with enhanced sites more process, country. hundreds strategy development openings to the national is allow us selection review to future strategy goals low ensure new

returns. we different availability courses new With to to size experiment the of of margin new with layouts optimize to the vast and best sites, number the of mix potential determine and continue profitability

returns have The from data venue four small data to are another. larger one real Both a We two courses. a similar with from venue Charlotte, Colony, and with courses generating

though. data than slightly The It And D.C., with but venue have less at from course recently soon, a have areas our seating in one does X. Colony, clear and venue will opened larger we which lounge more is

returns. market confident expected will within for clearly continue deliver the ranges margin proof a of are and that huge we sales gaining and to are We in concept

to Turning venue timeline. now Page discuss opening new our XX to

lease venues XX committed currently three are total today. opened to We with Puttery

remainder by QX, We us new in in next Pittsburgh of of five a total to open City XXXX, followed the total this throughout early XXXX, X. expect to Houston four openings additional an Chicago later venues Puttery venue and Kansas a new opening of the That year month, Puttery bring will year. with and ending with

We venues our year. outside slight a unexpected in zoning control, this open of opening of and schedule experienced couple to causing permitting the of licensing challenges originally planned have delays recently

As in such, both will early and Miami open now Manhattan XXXX.

XXXX, total in ending venue a Puttery XX opened. expect openings next XX with year venues We of

aggressively beyond. XXXX for leases are and pursuing openings We in new

various landlords will discussions Behind in the and We active in today these, on ensuring stages several are of a with national and goals analysis. our active and sites XXXX sites, in markets coming new with expanding in met. with both broker, our an for market expect identifying In of weeks. are are future pipeline identified low significant number those we we barrier partnership sites finalize have traditional development

be to communicating As last clear and to to we continue I open to venues as as quarter, number the expect and possible discussed them. very when we open will of comes it expect transparent when we

taking and the are appropriate thoughtful those time adjustments making rather. and with marketing current conditions our between approach openings given strategy remain -- and market amount We conditions to the of where needed,

recently adjacency be capital ago, economics golf that best both venue XX the for Puttery outlines presented confident our Puttery that will was clearly we we and at than timeline on continue by the venue. gives challenges, for to And track. Shack on possible, quarters entertainment chain can you permitting venue hurdles, obstacles several company. are the an very of economics present the Drive of and most D.C. we quickly and Shack keep the projected you grow us forward labor Puttery with supply is zoning While big and development illustrative here, our to ability higher put remain still level ahead to to less working When risk level venues. path look our Page returns our a growth and Drive are current the where business. box the as and see strain

venue-level of between to million spend each million six plan expect build a to Charlotte a clear Again, and to nine of to spend and and to As proof-of-concept EBITDA each. The between and Puttery remain to we takes that of a generating providing the $X financial venue, here. months physically turn seen between approximately our both update our million $X ranges. well million. ahead I million gaining our proof expect EBITDA venue reminder, also results. approximately $XX ranges venue, revenue Shack a and construct result Puttery are to to generates deliver build in Kelley as $X venue to each are with these taking within confident two and XX that that Compare we on generate and we venues We to are well now unit results real are EBITDA expectations, million $X our will where which to $XX $X $XX are will XX venue results you million Drive we months complete economic to over a it D.C. and QX between within million give brief Colony

Kelley Buchhorn

Thanks, morning, Hana, everyone. and good

Turning Page review for our deck the the for of now financial quarter. XX in summary performance a to

we year by of Golf the from Drive When to higher was American and compared an in venues company Puttery second our Charlotte XX.X% company $XX.X increase both million XX.X% compared recently, this QX revenue the the quarter $XX.X of million, million side which $X.X total most The to event of or break primarily we The in sales, last Colony, For year, Shack business, up generated and includes million. second year. second increase total and venues, down, million $XX.X million D.C. to three of entertainment generated last golf driven this sales $XX.X revenue in or our Puttery quarter year's $XX.X at revenue of mainly last total quarter,

in versus QX revenue million Our venues Shack generated last $XX.X Drive total year. four of $XX.X million

QX was revenue, strong or slightly While to events total led three million. year. and event down revenue was a quarter, Drive $X in our Colony year, $X.X venues by million drove million, $X.X Charlotte total up Shack versus last events business at with generated The including XXX% last million at venues $X.X by revenue Puttery was followed million our $X.X Total by this

Our was, quarter, in again, D.C. in the $XXX,XXX roughly days approximately location, XX total opened which revenue. delivered

For period and Colony our Walk-in $XXX,XXX. The as just ahead $X.X QX, delivered total Charlotte expectations. of I through for $X.X of business Charlotte the generated mentioned, The and continues Colony to at both year-to-date pace million, revenue in million, venue D.C. slightly our

On business, golf our generated of $XX.X managed side revenue course million, $XX.X the traditional American of million. total Golf reimbursements of including

American managed of $X.X revenue Excluding reimbursements, sales or million increase included quarter Golf the revenue of year. this $XX.X which million of or versus total million. increased managed event $X.X second course last million, course total XX.X% in totaled in primarily reimbursements compared million $X.X revenue XXX% which $XX.X year, to total higher year, last due The was up to QX

company the decision exit costs was due increased and expenses lease lease loss New last and $X.XX loss Puttery, compared Total change $X headcount following growth mentioned expected this the The $X.X QX in year. change per was and to back new Hana $X.X support versus compared Puttery per other investments of last Consolidated related in quarter million in continue other revenue related to development events across fully loss was As which year the development the year's a the the primarily both share last investments results to year the versus Shack XXXX. and bodes and to last Puttery. related million net million common for adjusted to loss future the strong was share. categories was are for in for last seeing $X.X and quarter we of quarter for well half XX, social EBITDA strategic earlier, or the last shareholders to loss expenses in the income $X.X this to was net in to the to $X.X momentum $X.XX Operating headcount corporate strategic quarter million QX strong to loss The Drive our year year. Orleans or $X.X as second applicable this year. June to preopening net in growth million $XX.X they consolidated the same million period million and primarily And venues, for for termination on of rise, year. million in of effective operating support

on year-end finally, beginning for Board primarily dividends company's future Directors development XXXX, due to of it For details of been of segment And with contributions reference, back and on the for The of to quarter capital $XX.X record I'll October second months of December XXXX, as expenditures traditional our compared cash and June of XXXX, six The the golf earnings preferred XX, And XX, reconciliations to of and declared associated the was Puttery X, was and non-GAAP EBITDA venues. XXXX. that venue with our XXXX XX, on turn first decrease stock XX XXXX. Pages provided the Hana the period closing and August for on remarks. to dividends as million of XXXX. Cash have million and to entertainment October XX, payable ending to holders October include are the equivalents presentation course that, and X, GAAP XXXX. XX $XX.X

Hana Khouri

today, Kelley. you to it over hand the Thank joining thanks, back us for for and all now questions. operator I'll

Operator

first from [Operator Instructions] Saleh We'll take our BTIG. question Peter from

Peter Saleh

Thanks, Great. of but guys on unit balance year. D.C. to development you got good that deck just and you Kansas for have and Chicago, just I and the the maybe morning. beyond. XXXX ask also wanted this for you've City Houston, about Pittsburgh know I opened,

additional units, has those for those to is you much been how how units? additional capital understand upon four contingent already Or four the capital? units to trying capital committed are -- much mostly those Just of raising is allocated that

Hana Khouri

allocated is capital The question. the for thanks Peter, those already. for units

foresee to those get don't issues opened. able we being any at So all

I mentioned year. to that fund be to development on for ample think calls able we had our this liquidity we pipeline prior

your answers that hope question. I So

Peter Saleh

Great.

just development I more for should the guess, that probably So 'XX capital raise. contingent it's Is upon we the it? about then, how think

Hana Khouri

businesses, Kelley, both part, of a use portion Shack able locations cash we but to to that year. that like, Puttery we're development the in next chime American our and and In if can existing of lot generating you'd fund a you were Drive our Golf, from

are capital. As get said in and basically. funded we engaged quarter, the I last We're been trying actively to have

debt, assets So quite we're we basically a looking our at our at balance we're looking and everything as looking sheet, across business we're at few well. have

could overly at So all currently in part. next given existing we we proceeds about the an have the business we're concerned from fact year not that that use

Peter Saleh

helpful. and could of Puttery, EBITDA gave little detail margin the this Maybe meaningfully us bit what secondly, guys last. this has a then you for guess, and that? concept a bit give go-forward just color, the That's do you think, And a a I very little Great. to basis? down, little color run And around EBITDA drove then for on bounced just hoping margin on bit but bit a little more you was rate quarter the expect venue-level come versus I more be pretty I what

Hana Khouri

Great Yes. question.

When love. So it we Puttery, onetime this first love inventory Puttery significant had we all, to with take of inventory venues, event. we we for true-up immaterial quarter. EBITDA expect actually an we opened that decline that operator's a and the to opened the be had a We system

recipes our bringing working part However, the were or the primarily realized of system. through in point that pulling -- of wasn't sale. the with should And accurately have. we quarter events from correctly inventory It we was this process when wasn't as that it up our

in depleting correct wasn't way. it inventory So a our

up correctly. it charged bringing Guest were was sale of point correctly. the So

that system broken. cost depletes you of the back-end correctly the good, back-end process up actually that bring actual a of an from item and was you goods, it where can and inventory your was bit see that so All but

in be the So an future. is to not absolutely That we've issue rectified going that.

However, on a seeing. that's to be at and this that you're the true-up EBITDA what rate in ahead the we XX% the I decided do quarter go expect and margins run basis, least range. will

I the XX% to think, in deck, XX%. our we gave

had we growing we're So we not around it's moving true-up and the we our had do that and anticipate part it numbers of and of ran expect one some this forward. learnings of very confident. experienced. pains be Again, the unfortunate XX% that we to It's occur,

Peter Saleh

you contemplating that of menu learned, open concept that in operating to bundles, three the you've that hours you're contemplating, just guys now terms Hana, then changes Great. or pricing, you are go-forward what based to And any on a on the have units any any changes basis? changes

Hana Khouri

Yes.

the of mind touched what along the comes number we the on of for courses is been with is think ride biggest one in time. and the which that size presentation, this whole Pete, need. you've that us the I actually I box to the

of So you days, We we're see square need need think the early we really which to indicative in in about Colony. is in remember But The area. have I numbers feet. it's we I saying, into we as courses, four their right for what you that as units and smaller search XX,XXX realized performance, and think the go given actually long Charlotte's XX,XXX that can --

As on of as that Monday, goes, bundling far at, night, cetera. days, specifically softer have thought pricing the and is looking we been our are something actively et Tuesday

doing with by revenue pricing and of pricing are of optimize looking So Gameplay. our to kind maximize at or some kind bundling the different -- ways we

-- more that to come for on that sure. So

enter menu. the seen food As drink about really, really, really have had far menu really strong People feedback menu, that. as our positive we've

market and and we our looking very people markets, are them And the look changes at our there design, research We the much those come own New don't hope some kitchen we menu drinks. great variety a future. few you'll love. of drinks what at our and our the enjoy have and sales. but kitchen really York time, which They're a ways to they're that as in enjoying makes as changes want, clear just changes place on and go a have It's be plan new We us as large-scale can enjoying making a reasons, and drinks to market. basis, on to food people it in of City only a hang to look some we our increase have that we sense. where layout, continue That's specifically due menus see to out into location-by-location will as

Peter Saleh

walk-in often Great. customer look data? how chance guests or gather Just the on to Puttery? comes to had visits back? And understand you repeat any trying then lastly, at just average that that Have the kind for at thoughts a data of

Hana Khouri

of in that really The with and mean any a is on but given I -- both fact year-over-year mind, yet. lapsed Puttery, number year we in now, a for Right repeat about Colony our Yes. and which, reservations XX% at haven't the keep I locations measuring Charlotte, we're think, strong not we're

their And of have yet I different out, that drinks same number kind a hanging so and know don't with course to what to be. that's the want we turning telling what us or is people play are perhaps friends. actually they're course to returning

was I I of when a -- worth number. go year's really, expect think to range pleased I is number XX% I that only we'll in the history. that operating saw have future, that that given up the really

always year-over-year as is goal well revenue. visits our as on build to So

definitely heading the we're there. in right direction So

Operator

question next Alex Fuhrman comes from Craig-Hallum. from Our

Alex Fuhrman

much looks the business? to at they Great. talk you events particularly of starting for pre-COVID pipeline to do room to kind both see here the your to levels? can events return your obviously, you have the be still back been but contributor, where needs quarter. ask Are the get event the taking think there building of Puttery. business Thanks for closer of you about getting for And year? Hana, it there? very of And you to as back my It hoped? in big kind what's when of concepts, half to get Is event really like your about that business fast I Has the wanted second question. was a as would at

Hana Khouri

question. Thanks for the

a couple to So things unpack of there.

just varied the amount First, brand we've of be, open should in Puttery where they I are and the amount been time we've b, the time of given awareness. in a, general we for been market that think locations events absolutely think

right? obviously, one. really So No live able when actually as other We photos first show what effective like. what Puttery any looks These was a which but Puttery a as that The renderings, didn't are a have opened very nearly than is our to venue. we something being This Colony, one is effective, the heck tangibly, knew was. to see not photos or of walk-through

were back in we same brand. starting really to never more we the and market, area, pretty really of in go I is happening I'm a the hill business Colony. they very few going time the see and showing. way. market next which And think to new because to in that's event to Any resourceful we're us is for not into new heard a come significant So The Charlotte a D.C. but in is climb of Same mountain the years to difficult only you're really also be with kind have Puttery. the It or that,

crunch was news right? under they last seen QX, events. bit and We get seeing. where Everyone say in one across a properties, that the just So airplane lot see we just which ourselves year, is it travelers as last this really building, to didn't revenue they're their easier. corporate we see see they the the folks way. airlines that year. didn't We Raleigh of specifically, they be. as a establish holiday a about for all trip, went road flying then anywhere. with And high right want And big of is it It travel expect brand, it I the Drive in they're or I coming a think to are maybe we a And back event traveling houses volume the take but on about They that Shack this, given especially I'll thing an we've our now. are

well do this and that fact is walk-in COVID normalize to think, of that both expect back during pick a we're little year. we right due down. bit seeing just kind the the reverse our people But summer. effect a And up down are now gone as the see our half So events, are bit for where the of I to

Alex Fuhrman

are a sense. Okay. different you've the at many that statistics. like as based keeping the the seems of of seeing. the Gameplay That guests number of lot all XX far are of magic through course as targeting ask there on very And getting locations. possible you track so doing throughputs targeting? could the then that on of guys that Is really It a you're people if I makes job value a as kind about that courses your seen good minutes spot as you're balances sweet well of Is the what maximizing the kind

Hana Khouri

to get courses, of I take would XX little our have like in it two yes, and through minutes course. between Charlotte, tend the does locations, XX longer we say, some a to where bit

able XX want game premium a through value really and get However, minutes, play be in to paying You a want When there's it friends, to take with right? to don't your right? you go enjoy also that, it. to to you're

it through, love Millennials the minutes, the is in there shot a of want and come end way. they'll People really and and front to Instagrammable. they wherever the in XX and this that We've want to I sweet XX go spot. show that fix shorter specifically I through, our just to long is learned course, take they'll to doesn't say, So take hole. black much particular it one the it that through to their to the is didn't which course the The go Gen illusion picture course, love course our just get by at but and venues. hole X, does like of they'll Colony, know. get because play desk white to unexpected, there, say, which that which Zers future was their think, is we're taken, like very was we time taking to in photo, that They because But amount steps it's

When very think, But that's beverage people keep have But these XX the over we I story for. fine. really course. get minutes, area, mind, absolutely short, anything do XX-minute So XX-minute quickly. just mark they unique feel is disengaged long on the you become when offerings to we what is can aim like each in

a be in be pretty and folks staff this for trained well is to for their that might one hole helps little well for order go drinks. these our manage kind of able up the the their versed front able very time of to bit to next And them or waiting their shot us better. be So in finish group that to to of to

Operator

EF Hutton. take Edward question from our We'll from next Reily

Edward Reily

thanks second the help G&A I'm sequential million you much questions. if was Hi quarter. wondering nature? this could the how was $X.X understand for guys, wondering I in taking my in increase onetime in me of

Kelley Buchhorn

Yes.

corporate total about G&A, talking You're Eddie?

Edward Reily

Yes.

Kelley Buchhorn

a to at when first say half were you bit light would were across COVID, We an were look I year. started build QX levels for We organization in and development increases and the we last to build it we coming of building in really did corporate little really this spectrum. these out certain the last XXXX, out were year Puttery we the as started as of out year, coming and and staffing certainly Yes. We and QX into coming where of back really up there. expect half such. plans the growth planned as of we

off through to say I get as maybe see onetime increases, but more a So kind would start it's of half you'll versus that little kind a getting think back bit to normalized the probably of to of I you level year. this levels

Hana Khouri

a to level. it's increase just elaborate of get a onetime us is this kind normalized to -- And to a on Yes. that,

expect increases degree. to that see you shouldn't subsequent to So

needed In fact, actually better we as to scale. actually did able you add, But we need we do to seen, people that. have has to we up, our revenue be all as support should event gone

book just we before place. where they and reach if on the COVID, to event, a get age, can't the to to be they after leads able people couldn't the folks this next someone to they're point day add to made decision to couple of an of go hold those So book got in going and a because

was that So important to us. really

of also -- signed needed pipeline. getting added to really we our able the sites some be or to the half lease the venues We needed add but small bit G&A getting we to the battle. So address to is as only a there,

maximize people actually, in so staff general construct train our to -- revenue open, that ground on oversee able able actually And able we able we're that is the being other to to a, once half it to once able is the be having and The the team contractors. having to we're b, space.

quarter-over-quarter. expect that of of to there a did number to make. should again, additions need see you that But we kind So were increase not

Edward Reily

Okay. color Great. Really the appreciate there.

the mentioned you sell the real have. you're for? sell of to of estate pieces guys to What that able do potential -- potentially think the monetize You one you

Hana Khouri

looking everything. We're at

at nothing So this is off point, limits.

we're know, We are balance a that here, detail and -- could going looking as very strong assets can granular you at of sell, have really into we go number to but have we we I tell not all a we you, sheet, of have that.

bit we be potential sure or to of weeks, coming lot make as find get So information decisions everyone there's know. our let to a there growth. little a to and growth of the able a we And more be again, we to put will in as release out

Edward Reily

to the attributed X% QX. true-up, beverage to that then And I be margin it like about it true-up? could decline gross inventory the food Great. as sequentially and if wondering decreased from was inventory It relates Okay. looks

Hana Khouri

it's or package food That's bring right? Events, know flow, goods absolutely. we cost are speaking for packages. that or package that they you helpful really of and use because whether not, superhit it's a as counted consume Events towards bev our of still game, bev revenue these of folks XXX% and or usually the really specifically food what the our a package. cost in. And XXX% buy Yes, about but

the add? to because do not Kelley, Again, have anything a one of learning repeat can have to that. in it yes, for things expect as significant and mitigate to we that lot we So you are us place absolutely now do onetime to going a be true-up. that attributed

Kelley Buchhorn

that No, I was perfect. think

Edward Reily

then just Okay. I'm maybe for the in one real prompted Awesome. real estate for strategy? curious change Puttery me. to estate last And the as brokers what

Hana Khouri

to the lot great a a needed question. that was what bottom changed broader us we -- that have we me but had. reason than there's and for a It's The reach of for reasons, line we

a landlord regional and reach or With that also with more not timelines. comes broker may It have. the established may relationships broader broker comes expedited

timeline. this -- pipeline of bit we surprises. little really our think looking we getting I as were, we when at adjustment, And the tired we So a as when were made frankly, our did well did because it we

XX We zoning that licensing that appropriately have over market might for terms idea in complete some and can running our each looks like. analysis so our pipeline markets permitting, of firms us now heads the some of more in in we be on what what timing with kind anomalies and of

So be this absolutely us help able that. to new firm with will

to about be XX they're to then announcing when and significant specific open we more estate when through is much to or them we're hurdles plenty we open we being and order That There's really those which of, there. to able dates short when. So down opportunity, went to came know With in not venues, having make we to get happen. that versus prioritize XX is when out expect real just so one that thinking where are it we great. of going can thing

Operator

It program no closing appears that back have I Kelley time. turn now or additional more we questions any for Buchhorn at over this the will remarks. to

Kelley Buchhorn

forward we and to everybody any day. today. thank additional for have if us joining a next always, Have around And like Thanks, great out. look just if quarter, to not follow-up And we'd to speaking before. questions, you Gretchen, reach as you we're

Operator

ladies you, today's Thank gentlemen. and concludes This conference.

now may You disconnect.

Drive Shack (DSHK) 9 Aug 222022 Q2 Earnings call transcript