Specialist
Executive at California-based entertainment company
Agenda
- Out-of-home entertainment industry dynamics and recovery trajectory
- Family vs adult entertainment positioning and growth opportunities
- Competitive landscape across concepts, including Bowlero (NYSE: BOWL), Dave & Buster’s (NASDAQ: PLAY), Topgolf (NYSE: MODG) and others
- Near-term challenges and long-term demand outlook
Questions
1.
What’s your outlook for the US out-of-home entertainment industry over the next 4-6 quarters?
2.
In terms of the industry’s recovery curve and relative recovery, could you give a bit more perspective on what you’re seeing in terms of how this stacks up vs 2019 levels and how sustainable that is? Where do you see relative demand showing up on the revenue and profitability front? What are your expectations for a recovery timeline for operators that maybe haven’t fully recovered to 2019 levels?
3.
How big of an opportunity do you estimate this industry to be in the US? How should we think of a TAM today, and how does that break out across segments such as bowling, family entertainment, arcades, etc?
4.
Where do you see the biggest growth pockets when it comes to looking at the TAM across each subsegment? What are the biggest expected growers longer term?
5.
What are some best- and worst-case scenarios for the industry in a potential recession?
6.
What are your thoughts on the durability of consumer spending, given the fall in discretionary incomes?
7.
How are operators keeping up with cost inflation?
8.
When it comes to the cost structure, what variable vs fixed costs tend to encompass the bulk of an average unit’s cost?
9.
In what ways have some of the unit economics evolved when we look back to pre-pandemic? If we look at family vs adult entertainment unit economics, have the unit economics been much more or less favourable to one type of concept vs the other, in particular a Dave & Buster’s, which caters to more of an adult audience with its alcohol offerings?
10.
Could you discuss construction development, especially for the concepts that are more greenfield in nature or that are looking to grow beyond their regional concentrations?
11.
Could you discuss the competitive landscape and what you’re seeing? What’s your outlook for Dave & Buster’s, given you’ve mentioned this company a fair bit? What are your thoughts on players such as Bowlero, Topgolf and other regional players, and how do you see them stacking up in the space?
12.
Dave & Buster’s June 2022 acquisition of Main Event represented a valuation of a 9x multiple on Main Event’s 2021 adjusted EBITDA. What are your thoughts on this? How real or realistic are the synergies between Dave & Buster’s and Main Event? On paper, they’re different businesses, serving different customers, and as you called out, there’s some figuring out to do there.
13.
Do you have a figure in mind for the growth outlook for the overall US out-of-home entertainment industry’s unit counts and the white space?
