Shares of Bowlero Corp. experienced a surge on Monday following the company’s announcement of a dividend payout to its shareholders and the release of better-than-expected fiscal second-quarter revenue.
Bowlero Corp. revealed that it will be distributing a cash dividend of 5.5 cents per share on March 8th to shareholders listed on record as of February 23rd. With a closing price of $11.60 for the stock BOWL on Friday, the annual dividend rate of 22 cents per share corresponds to a yield of 1.90%. This surpasses the implied yield of 1.43% of the S&P 500 index SPX.
Strong Revenue Performance
The company reported a remarkable revenue increase in the quarter ending December 31st, with revenue totaling $305.7 million. This represents a substantial 11.8% jump compared to the FactSet consensus estimate of $300.4 million. Bowlero’s events business experienced impressive growth, contributing to a significant boost in revenue of around 30%.
Factors Driving Revenue Growth
The positive revenue trend can be attributed to both strategic acquisitions and new builds, which generated an additional $41 million in revenue. Notably, this quarter marked the first full reporting period following the completion of the Lucky Strike acquisition on September 18, 2023.
Bowlero Corp. also highlighted the positive performance of same-store revenue, indicating revenue from centers that have been operational for at least a year. This was influenced by a revamp of midweek promotions, improved pricing for weekends, and strong traction within the events business.
Overall, Bowlero Corp.’s successful dividend announcement and impressive revenue growth showcase its promising performance in the bowling-center industry.
Bowlero Reports Second-Quarter Net Loss
Bowlero, the renowned bowling entertainment company, has reported a second-quarter net loss of $63.5 million. This is a significant decline from the net income of $1.4 million recorded during the same period last year. The net loss attributable to common stockholders has also widened, reaching $65.4 million, equivalent to 44 cents per share.
The company has disclosed that the net loss includes an expense of $64.1 million resulting from the impact of the earnouts for the period. As of December 31, there were 11.42 million unvested earnout shares outstanding.
In positive news, Bowlero revealed that it repurchased $80 million worth of stock in the second quarter. This follows the previous buyback of $131 million worth of shares in the first quarter. Furthermore, the company has updated the buyback program, now totaling $200 million with no expiration date.
Looking to the future, Bowlero maintains its optimistic outlook, with an expected revenue growth range of 10% to 15% for fiscal year 2024. Despite this positive projection, FactSet’s current revenue consensus of $1.16 billion suggests a growth rate of 9.1%.
Bowlero remains committed to reinvesting in its business and has increased its allocation for acquisitions to $190 million from $160 million.
Over the past three months, Bowlero’s stock has experienced a notable rally of 18.6%. In comparison, the S&P 500 has advanced by 13.8% during the same period.