Dave & Buster’s Entertainment Inc (NASDAQ:PLAY) Profit Rises

Dave & Buster’s Entertainment Inc (NASDAQ:PLAY) stock rallies 11.31% (As on April 3, 11:15:23 AM UTC-4, Source: Google Finance) though the company posted lower than expected results for the fourth quarter of FY 23. Pro forma combined comparable store sales (including Main Event branded stores) decreased 7.0% compared with the same period in 2022 and increased 8.0% compared with the same period in 2019. Fourth quarter 2023 pro forma combined comparable store sales compares the 14-week period of the fourth quarter of fiscal 2023 to the most comparable 14-week period of fiscal 2022 and 2019, respectively. Fourth quarter 2023 was significantly impacted by abnormally adverse weather conditions. Operating income totaled $89.6 million, or 15.0% of revenue, compared with operating income of $77.2 million, or 13.7% of revenue, in the fourth quarter of 2022. Adjusted net income totaled $42.0 million compared with adjusted net income of $41.8 million, in the fourth quarter of 2022. Adjusted EBITDA totaled $151.8 million, or 25.3% of revenue, compared with Adjusted EBITDA of $138.4 million, or 24.5% of revenue, in the fourth quarter of 2022. Store operating income before depreciation and amortization totaled $184.5 million, or 30.8% of revenue, compared with store operating income before depreciation and amortization of $169.0 million, or 30.0% of revenue in the fourth quarter of 2022.

PLAY in the fourth quarter of FY 23 has reported the adjusted earnings per share of 85 cents, missing the analysts’ estimates for the adjusted earnings per share of $1.11. The company had reported the adjusted revenue growth of 6.3 percent to $599.1 million in the fourth quarter of FY 23, missing the analysts’ estimates for revenue of $602.6 million.

Additionlly, the Company generated $97.2 million in operating cash flow during the fourth quarter, ending the quarter with $37.3 million in cash and $490.3 million of availability under its $500.0 million revolving credit facility, net of $9.7 million in outstanding letters of credit. The Company ended the quarter with a Net Total Leverage Ratio of 2.2x.

The Company repurchased 8.5 million shares totaling $300 million and representing 17.5% of outstanding shares during fiscal 2023. The company has increased its share repurchase authorization by an additional $100 million bringing the total available share repurchase authorization to $200 million.

In addition, the Company has announced that it has entered into an international franchise partnership agreement to develop two stores in the Dominican Republic.

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