Latest News

Earnings Results: Bowling is back with ‘a vengeance,’ but Bowlero puts up a loss and stock falls

0

Bowling-center chain Bowlero Corp. on Wednesday said bowling came back with “a vengeance” during its first quarter and said it “adjusted” its prices to offset higher costs, but the company swung to a loss and shares fell after hours.

Bowlero
BOWL,
+1.03%
,
which runs more than 300 bowling alleys in North America, reported a first-quarter net loss of $33.5 million, or 22 cents a share, compared with a $15.6 million profit, or 9 cents a share, in the same quarter last year. The bowling chain made $230.3 million in sales, up 27.2% from around $181 million in the prior-year quarter.

Management attributed the net loss to the effects of “$40.8 million of non-cash expenses related to the increase in the fair value of earnouts.” The prior-year quarter’s net income, they said, was boosted by a tax adjustment and “lower costs” related to labor and being a private company. Bowlero went public via a special-purpose acquisition company, or SPAC, last December.

Analysts polled by FactSet expected earnings per share of 4 cents, on sales of $223.5 million.

“Bowling is booming and we are pleased with our continued world-class performance in the first quarter, particularly relative to the prior year’s comparable period, which reflected a rapid recovery from the pandemic and corresponding staffing shortages,” Chief Executive Thomas Shannon said in a statement.

Similar to the fourth quarter, executives said that the company had benefited from the return of larger groups, after two years of pandemic restrictions.

“The first quarter saw both the event and league business return with a vengeance,” Chief Financial Officer Brett Parker said Bowlero’s earnings release on Wednesday.

He added: “Furthermore, we have recently adjusted pricing to better reflect the current environment and offset macro input cost pressures.”

However, the company’s adjusted EBITDA margin — or earnings before interest, taxes, depreciation and amortization — was 28.4% during the quarter. That was down from 32.5% in the prior-year quarter. Parker said the slight contraction reflected “more normalized staffing levels compared to the first quarter of last year when we operated with pandemic related staffing shortages.”

Shares of Bowlero have run 53% higher this year. By comparison, the S&P 500 Index
SPX,
-0.83%

is down 17% over that time.

Market Snapshot: Dow, S&P 500 end lower as investors hit pause on stock- market rally, Target results disappoint

Previous article

Washington Watch: Republicans clinch slim majority in House, likely signaling gridlock ahead

Next article

You may also like

Comments

Leave a reply

Your email address will not be published. Required fields are marked *

More in Latest News