Bowlero Posts 10% Decline In Q4 Revenue; Boosts Share Buyback Plan

Bowlero Corp BOWL reported a fourth-quarter FY23 sales decline of 10.6% year-on-year to $239.42 million, missing the analyst consensus of $241.62 million.

Revenue increased 54% compared to Q4 FY19.

Normalized calendar same store revenue declined 2.6% versus the prior year and grew 29.3% versus Q4 FY2019.

Gross profit for the quarter plunged 30.5% to $57.2 million with a margin of 23.9%.

The operating margin for the quarter was 8.1%, and the operating income decreased 57.9% to $19.5 million.

The net income for the quarter was $146.2 million versus $6.9 million last year.

Adjusted EBITDA of $64.5 million declined 21.7%, with a margin shrinking from 30.8% to 26.9%.

During the quarter, the company repurchased 6.4 million shares at an average price of $12.64. Bowleo has 160.2 million shares outstanding as of August 30, 2023.

On September 6, 2023, the Board authorized an increase to the share repurchase program to $200 million.

The company held $195.6 million in cash and equivalents as of July 2, 2023. Operating cash flow for the quarter was $8.9 million.

Outlook: Bowlero sees FY24 revenue of $1.14 billion - $1.19 billion versus an estimate of $1.14 billion.

Adjusted EBITDA margin is expected to be 32% - 34%. 

The company will have more than $160 million allocated to acquisitions, $40 million to new builds, and $75 million to conversions.

Price Action: BOWL shares are trading higher by 7.7% at $10.91 on the last check Monday.