BOWL - Earnings call 2 2022 | Lucky Strike Entertainment Corporation

Due to licensing restrictions, you must log in to view earnings call transcripts.

Operator

Greetings, and welcome to Bowlero Earnings Call for Q2 Fiscal Year 2022. [Operator Instructions]

During this call, the company may make certain statements that constitute forward-looking statements. Such statements reflect the company's views with respect to future events as of today and are based on our management's current expectations, estimates, forecasts, projections, assumptions, beliefs and information. These statements are subject to a number of risks and uncertainties that can cause actual events and results to differ materially from those described in the forward-looking statements.

these with uncertainties, X, the concerning final see XXXX. details filed prospectus SEC further risks please and our For on February review future developments The publicly otherwise, except as any disclaims by or result any applicable required or law. a information, company whether forward-looking new obligation of as statements, expressly update to

income Form believe can of Parker, XX-Q conference [Operator call, is quarter and in Corp. evaluating useful found Bowlero President your today's during discuss adjusted my addition, earnings and Mr. be to fiscal company this will press Instructions] It GAAP recorded. year non-GAAP introduce will in is now CFO you performance. could of Reconciliations for XXXX. the you. calculated may financial in our second In be begin. being the pleasure Thank reminder, measures, be our EBITDA net which Brett under we release As Parker, Mr. a to our of host, included

Brett Parker

to Earnings Corp. Good am and Bowlero of and Year Discussion CFO Brett Parker, Bowlero I Fiscal of welcome XXXX. evening, QX President for the Corp.

I which begin, in of presentation. X non-GAAP discussion in well In in disclaimer with for GAAP. on both the you the accordance with this EBITDA, parts presentation, deck to a or I financial Before as not to of as accordance appendix, is the you measures an will things, of, prepared are adjusted other reconciliations measures non-GAAP among direct that integral find which is of the Page measure alternative a this

business as Year-over-year excellent came COVID-XX profile also interruptions revenue levels and it continue Omicron as XX%. falling on with related and the by by Halloween This pre-COVID weekends. variant of Christmas despite our far emergence better pre-pandemic, to the than performance of from the well as and continues increased continued unit XXX.X% pleased of business surpassed perform performance advance. to we We extremely growth the to are to has COVID-XX. The was recover the

unit increase This which growth, and growth. our organic performance by supported is multi-vector combines strong

Bowlero Corp. with X by the of along Spring new Oxnard, California Florida, Vacaville, and newly portfolio constructed California, opening During its X of Florida in existing of consisting Hill, bowling Tysons Lucie, centers the grew Port center acquisitions and bowling Corner, St. centers X quarter, in adding centers Virginia.

million generated the QX, was $XXX.X $XX.X fund of pre-pandemic than quarter. business. million operations EBITDA million $XX.X year. Adjusted than fiscal by is the in higher which $XX.X level EBITDA adjusted in prior in XX.X% XX-week investments level million QX, cash our was the We pre-COVID figure and and XX.X%. the the higher from At This end helped trailing exceeded in

can X revenue. Page materials, center recent the On bowling of trends see the you in

through end This business. chosen As we is impact be done This this related the do not have we that we the of the extend Omicron's central something QX. performance will have expect that to of Omicron on purely is extended following release to of the data assessment expect questions indefinitely. we through how chart to wave, our one around of the weeks several

have total was in felt both and As we events center Omicron's impact event most revenue, business, center strongly the total revenue revenue. excluding presented

impacted pre-pandemic of is X takeaway levels center trend well here key overall excess in in intact. revenue generating the that headwinds bowling the key revenues The that were of There remains quarter.

see business. on December, the impact Omicron the of is events box gap negative and between in a impact red weeks, you X weekends, Christmas meaningful on revenue Halloween at the clear excluding in see can fall total revenue revenue. which year, the Then looking event on had highest the having event period the revenue and you of As can

nearly weeks, well in into and recently, double the growth XX%. most revenue Now total digits recent to delivering returned we have

the strong QX XX% how quarter. On disciplined out Page the adjusted EBITDA versus X, of management, macro revenue Adjusted in increases also XX.X% EBITDA basis input was to adjusted comparable we was. than expanded we XX.X% quarter nearly performance, to in increase EBITDA $XX documented XXX the quarter. coupled cost in over pre-pandemic broadly million margin by an costs, pre-pandemic with The the just levels. pre-COVID points led laid higher equivalent have from versus Despite

the sharp chart The illustrates COVID the year. Page impacted levels the X on of recovery business last of from

of see fiscal end First, QX year trailing XX-week 'XX. through from the of end adjusted expansion quarter-by-quarter of you of year of the can fiscal EBITDA the 'XX QX

We the in the by purple QX alone. context, XX.X% we than FY XXXX now versus as the grew level For shows higher line adjusted 'XX level of million. pre-COVID stand $XXX.X EBITDA million of comparable pre-pandemic FY $XX.X

center economics level X bowling to how the improve. continue Page illustrates

versus We the year COVID-impacted total versus prior quarter the and have charted quarter. comparable pre-pandemic the also

calendar. grew revenue offset As partially the and from This discussed, was revenue significantly. the by in by increases changes impact led guests in walk-in on events unfavorable derived and Omicron

pre-pandemic centers the million more In largely $XX the in as result bowling XX% of EBITDAR significantly model. to from implementation centers quarter. and quarter, the of redesigned XX% for margin business generated our Gross expanded versus total, of efficient a the

out X for the lays cash quarter. flows Page the

noted The in performance pre-pandemic very Thank for quarter. and In Bowlero's your of cash additions. 'XX outpace to combination of further for position be strong I summary, positioned company which growth previously, center and the support demonstrating improved produce generated to organic time, well finished that FY again million. the I with forward business you $XX.X new of next levels, As performance through to cash, to over a our look continued presenting continues quarter company acquisition, in and balances centers. QX building million conversion a provided $XXX the

now can we take Operator, questions.

Operator

of first with the Our comes Securities. Instructions] Stefanos CJS question Crist [Operator line from

Stefanos Crist

on the quarter. Congrats

during acquisitions little looks quarter. acquisitions on the you give X for made you what a maybe First, detail us the like? pipeline Could more

Thomas Shannon

Yes, This Shannon. sure. Tom is

locations acquisitions. ever the had of robust the existing robust really had I'd easily a If build the and pipeline XX a company. centers ballpark is to history this we've new point, as to in say have I which most at We pipeline. of XX bowling units, combination It's

Stefanos Crist

That's great to hear.

also how earlier how think about week, that? you think you repurchase that this out authorization. you and about talk so maybe growth Can the balancing acquisitions and about with And that through share announced you

Thomas Shannon

is act. balancing a it Well,

Fortunately, capital not constrained. we're

Brett cash. in the substantially of and, year. generating is million lot the level cash. We've got we're comments, over we're prodigious the of at faster undrawn a it. frankly, mentioned generating in As than company importantly, sitting a of amounts facility. cash a at most $XXX part substantial -- best We're his of revolver But a We're spending

coming deals These down So week. our a to long keeps debt take time every net play number out.

right? get have. finish not what line, XX, we across the That's will just to XX those of And all

are those of Some prospective.

capital renovations Some now those But all line. it's rate, the meaningful center acquisitions, will new builds get or renovations not leases the about and to actually are scale of addition we're signed signed and exceed finish new or existing process we of agreements. our allocate acquisition build the in But XX our hurdle to whether that of existing opportunities in to centers, acquisition all pipeline.

The not will any share of at repurchase come those the of expense deals.

without bit. out, these pipeline of of repurchase of shares way to cash, the continued timing the between So development generation the and one be meaningful slowing we'll able market play in cash deals sort our down sources

Stefanos Crist

I hear. almost has And just returned great activity one maybe in That's event looks It to more. squeeze like normal. and could to league

segments? there's room to still that, grow to those and attributed in if what's So X

Thomas Shannon

the league up extremely up asked We're December probably has first The of be that we an glad in COVID, sign. like looking or up heading since held double think. million up I'm would have The or business pre-COVID. November December 'XX so, I an low And and on digits into event basis high the you comp question. would versus that been actually single bullish well. business pretty for $XX comped time was event

up Friday, in and announced million sort down booking because unfortunately, being teeth the ended event the of right Omicron season. which We of Black was $X on was hit really

So asking what is stopped call bookings refunds. happened event for started they then started for to slow and then the and people new

being so we up than meaningfully, meaningfully. were And down rather

on I think XX%. the about number was of order

strong, hurricane strong you mentioned, as and unfortunately, Omicron. October, And a into see very of November so number quarter comp is then, in right running I the the a and what positive

Now you we that happening My had a those know, or restrictions. that some that have municipalities day. data point restrictions version of on It's fortunately, Omicron literally is pretty know, receding be to of may rapidly. lot seems releasing as as every you COVID

last had XX And of through seen back Omicron sorry, strong so brightest November. expect course, league and story, retail will been we're to we or seems part we've I that the side moving extremely like it walk-in the which of just past And happens, Omicron. But then over business, business that the on of event COVID that trend resume the the been has -- of resilience tremendous strong and really and as has the most months. the come

So that's a business. nice thing about our

better. and as different we The this in was, of sources. of strong walk-in the lot league into the meaningfully quarter, cetera. not the a the December, Omicron But would were revenue going strength extremely have been events the weaknesses. business, looking and had the have business fortunately, businesses business, other on some event have some And side et of it offset We good hit recurring as

Operator

next with Partners. Our question Eric Handler from comes MKM

Eric Handler

several good relative talk questions sort same-store one you had growth momentum positive by you've one. got the to of levels? about do sustain last Wonder just go that have quarters. pre-COVID What for you you confidence could I you. I'll very if over sales X -- can

Thomas Shannon

one. we in high-margin most us was and Tom impacted good month I'll of Shannon. year, cost this Well, the event is it take really $XX which quarter is, of a the just million easily again, mean, by had quarter, far, adversely revenue. but important December, I this

where given coming that was I so out anomalous, And are Omicron. think, we of

a business strength think were seeing the We're incredible it's just now. in momentum pre-December. of our continuation I And we seeing

been reverting seeing quickly months. normal. The I'm I in coming now over to are is back think than stronger event has business. last X things event business the it the it

a a thing is reasons. the there's really economy. we've of of a We've built centers, the And so in bought think number lot One XX from tremendous we've months taken a of There's or amount last of strategic I many, in position. ourselves strengthen is markets. and key pent-up in for the centers of many a lot to a savings have our of lot other But we tailwind demand. reinvested

product so we the important markets. most in excellent have And

And in was investing all result shape so pre-COVID as better portfolio that much than it of a is activity. the

dark So I the all no really on combination factors that horizon of at this the a see and point. spots can

Eric Handler

Okay, remaining you the little openings about wondered thinking the you could how let's of of as into then as go in through you're could Wonder I visibility this maybe of new year. the fiscal if the X well talk a remainder if great. 'XX secondly, year us And of just quarters about bit as next center course well. in and upgrades give each

Thomas Shannon

renovation. I have centers mentioned about we Well, process XX in of currently

be year, And by those so of done end centers start we'll those from and to positive the the XXXX. likely lift fiscal see all fiscal some in will

have end of acquisitions. better that what to prior Brett, we're you and close is that handful you know fiscal than We centers I may looking do the number year. a to acquire of terms the of think in

new we opening to new at of terms fiscal be any now In the builds, of the centers aren't year. end to

Brett Parker

pretty a exact This shake tough Tom. like the large Brett time of And a timing out. really unsophisticated long of It's when the balance difficult handicap with sounds Thanks, is handicap. things the of to number these Parker how sellers, while year it's you're to Yes. significantly dealing speaking.

want updated point got a hopper, remains the those that matters, lot versus think guidance pipeline really we're I the And from the the what we've which robust. of in So I done deals pushing to is before. is Tom We've any overarching along. give don't color and that

Eric Handler

Great.

has Okay. And acquisition, a acquisition. the little you since that completed I about could America that you if Ball performed wonder then talk bit last, how

Thomas Shannon

acquisition. Well, with that be pleased sort we a of couldn't Ball more was America acquisition. nontypical

we thought You had been were losing oblivion. of centers harvested lot potential. handful really sort The There a of money. had or into centers some business EBITDA meaningful has of a neutral that either that were

center to making some deal. of the a ourselves any about had revenue. And It we Burnie, potential, in money that so that centers in $X strategy doing part think were the was divest Maryland the prior wasn't going Glen one of but any million to was of we was of didn't which

deal broker's closed, a of million up last $X.X of month had The selling ended to sell We that. believe, We million. $X.X it. opinion value I at

are also have or in centers X effectively that profitless We other were that, $X aggregate, million more.

likely certainly centers if well, take next those already close you expected and X, at that weren't much -- so contributing much those -- million fiscal And $XX.X so -- any centers year, -- X sooner on EBITDA. contribute than should X weren't in But we're in those just and to this the that.

price, indications from interest those centers the as capital. results change. in already. starting centers couple or no result, And little of trajectory -- of now months, been so of attractive the we real results is and their and haven't and now potential, that of over quite really purchase Of million that's last seen are profit revenue million as any the other will have goes of investments meaningful in a business a number yet, capital the without increase where we're the over received we think seen next $XX that just having the growth a we good, the months. net to view around have them, those But that down we've deploy spent potentially $XX in be having couple But seen

price the the we potential so than ultimately of we up that to the on X ultimately, keeping and or investing be meaningfully in of net will X term is deal expected. we going be in I think plan end we And ultimately in that centers we think higher purchase get divestitures these long And lower. that that

are hurdle I one. attractive, this rate, above going all for on think deal the them except we our own be very IRRs so very, and certainly And that to meaningfully

the choose. but on And certainly returns. capital just we don't would cheap to do so financing the so have ability we the opportunity now, further some should need to that, which We there's enhance put mortgage the them

Operator

comes question next Capital Our with from Michael NOBLE Kupinski Markets.

Michael Kupinski

does COVID that and And and or you're the years. forth. acquisitions, pipeline quarters if past? few wondering seeing does how accelerate to I'm potential possibly I few I'm pipeline to curious, the how COVID frame compare relative the you were restrictions that about of you just wondering, that was talking that past past just can because so

Thomas Shannon

the orders it's really acquisition the and pre-COVID, than on grow and new of side. pipeline was X and build magnitude quarters, last Well, over seen quarter it higher the both we've that's the every

so of it's completely X parties. set And different

owners On mostly mall usually boxes or dealing build retail we're empty. the got with independent become side, former large new that some who've have landlords

on of So the of outlets has it. has real market there more that the shrunk. trend more estate, as the estate number part is quality real retail come That's

among I landlords, those. that more the think mall entertainment their to there's certainly add also as a the strong to desire and draw larger a landlords locations so from we're benefiting

caused mean, side, the much. they're But availability and now good that than of things have I from but And acquisition on undoubtedly, you, I challenges times. fatigue, labor than also with long a resiliency setbacks. tell an with so frustrations And On more it's have organization with people and of COVID associates, there my as check and not independents, to what, the I'd an X,XXX to and through one perspective, owned wherewithal you this retirement we, to I process operating who of and can have lots worry some other the those enjoy centers now operator's take growing a challenges. have are their fatigue. think elderly say, faced we COVID center." lot And of deal a you about just been bowling know right, have decades rather proprietors "hey, rather well,

Michael Kupinski

the there were last just any understand in and so were were event to closed. understand centers due wondering, I forth, I just to COVID fully operational but Tom, to because that I'm there understand. not trying was if centers that restrictions certain trying revenue I'm the restrictions. just quarter, of were that

Thomas Shannon

but And were mask can't vaccine vaccine vaccine regulation you really mandates, the in but Yes. that been business mandates, the the like example, York the has closed governmental are in from New has our other timing, headwind restricted things have really impact in or New exact We And Canada. in impacted has were States other you in so York we biggest severely City. mandate business. it's Mask where that heavily centers the much, there seen give then a in X for for And significant I mandates United that impact whether we've the been The the not City, mandates. business. mandate Mexico. the

Michael Kupinski

that. Yes, I would expect

Can pressures for some So the balance discuss of outlook also for difficulty in wage a your of mitigate a cost cost costs, instance? you fiscal and employee for of of expressed have and inflationary firms expenses particularly the management of And how us year? you number light pressures maybe in managing the give employees. like in and, an retaining difficulty hiring cost cost course,

Brett Parker

this respect sort in that's really in particular, differentiated speaking. not compression I'll why Parker to players Mike, factors, had of outcome employee-exposed a we've result of you and benefiting we labor that are where from cost cost that. With We're Brett is or marginal handful margin are one. seeing take Yes, this seeing as that increasing. have a various industries costs,

we ground handful to out in really schedule able and I'll And efficient the, business, down in a in redesign terms that a during it call times manner it I folks and of comes to every did up a just were we of COVID, substantially the process the to had we of sheet paper so more an opportunity we times really sort from and fresh and thing. things. how when to Number guess, of one, take

of that technologies. Then the number implementation supports two that is

kiosk continued the in our tool. ordering, as which operating software, and billing to platform also our we invest then primary use our we in So booking online

costs hour hours of to unit same in that's labor, to by been using do the core. the for have per what and those experience, deliver thing really increases wage fewer So guest sort allowed to us substantially is offset average

with support which have very, we fundamental we high operating very of reality then that And is bowling, leverage. the that

revenue seen your that has effectively the perspective, And and because always variable incremental just we of price layer XXX if you we've top increases, on our will issue, in not no up costs levels revenue So you everyone situation quarter. margin that at an of the everywhere, at which level some moderate kind flow. this X/X in great an is then EBITDA center our that's see of by seeing you business, high flow points end where a and basis any the causing expanded from

So there the it very obviously. of results, cost business in think been. and shrink. business you're but rather increase macro the the managers And continues always to I side be the why pressure, reality, aggressive are we That's and shows have than that's seeing in margins the in

Operator

have we the to session, the gentlemen, reached back end and management question-and-answer Ladies for remarks. the I'd of call to like and turn closing

Thomas Shannon

Thank quarter. joining everyone and you. than Nothing we other support, thank for in really next speaking their to Great. forward to for everyone and again with look closing

Operator

This conference. today's concludes

time. You may participation. lines your all disconnect Thank at your this for you

Lucky Strike Entertainment (LUCK) 9 Feb 222022 Q2 Earnings call transcript