Dave & Buster’s Entertainment Inc (PLAY) Q3 2024 Earnings Call Highlights: Navigating …

• Revenue: $453 million for the third quarter of fiscal 2024.

• Net Loss: $33 million, or $0.84 per diluted share.

• Adjusted Net Loss: $17 million, or $0.45 per diluted share.

• Adjusted EBITDA: $68 million, with an adjusted EBITDA margin of 15.1%.

• Comparable Store Sales: Decreased 7.7% on a like-for-like calendar basis versus the prior period.

• New Store Openings: Three new stores opened in the third quarter; 10 new stores opened year-to-date.

• Capital Expenditures: $131 million invested during the quarter, with over 90% considered growth CapEx.

• Share Repurchases: $28 million repurchased during the quarter, totaling $88 million year-to-date.

• Cash Flow: $7 million operating cash outflow during the third quarter.

• Liquidity: Total liquidity of $546 million, including $9 million cash balance and $537 million available on the revolving credit facility.

Release Date: December 10, 2024

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

• Dave & Buster’s Entertainment Inc (NASDAQ:PLAY) opened three new stores in the third quarter, which are on track to generate strong cash-on-cash returns.

• The company completed 11 new fully programmed remodels, with plans to have 44 completed by the end of fiscal 2024, which are outperforming the rest of the store base.

• There was strong year-over-year growth in the special events business, with optimism for the upcoming peak holiday season.

• The loyalty database now has over 7 million members, with loyalty members visiting 2.5 times more often and spending more per visit.

• Dave & Buster’s Entertainment Inc (NASDAQ:PLAY) successfully refinanced a portion of its debt, extending maturities and increasing liquidity, which solidifies the balance sheet for the long term.

• Comparable store sales decreased by 7.7% on a like-for-like calendar basis versus the prior period.

• The third quarter financial results were negatively impacted by a material fickle calendar mismatch, adverse weather, and disruption due to remodel construction.

• The macroeconomic environment continues to be a headwind, particularly affecting the low-end consumer segment.

• The marketing optimization initiative has been challenging, with a need to rebalance media mix and improve digital marketing effectiveness.

• The company experienced a net loss of $33 million in the third quarter, with an adjusted net loss of $17 million.

Q: How should we think about the plan that Chris Morris was critical in putting together, given his departure? Will the plan remain the same, and what attributes are you looking for in a new CEO? A: Kevin Sheehan, Interim CEO, emphasized that the plan remains intact and the Board, along with the management team, is committed to executing it. The search for a new CEO will focus on finding someone with strategic vision, operational execution, and financial performance capabilities. The goal is to integrate dining and entertainment into a cohesive, scalable, and profitable business model.

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