Bowlero Corp.

Thank you for standing by. My name is John and I'll be your conference operator for today. At this time, I would like to welcome everyone to the Bolvaro First Quarter 2035 Earnings Conference Call. All lines have been placed in mute to prevent any background noise. After the speaker's remarks, there will be a question and answer session. If you would like to ask a question during this time, simply press star followed by the number one on your telephone keypad. If you would like to withdraw your question, press star one again. Thank you. I would now like to turn the call over to Bobby Lavin, Chief Financial Officer. Please go ahead.

Good afternoon to everyone on the call. This is Bobby Lavin, Bolero's Chief Financial Officer. Welcome to our conference call to discuss Bolero's first quarter 2025 earnings. Today, we issued a press release announcing our financial results for the period ended, September 29, 2024. A copy of the press release is available in the investor relations section of our website. Joining me on the call today are Thomas Shannon, our founder and chief executive officer, and Lev Exer, our president. I'd like to remind you that during today's conference call, you may make certain forward-looking statements about the company's performance. Such forward-looking statements are not guarantees of future performance, and therefore one should not place undue reliance on them. Forward-looking statements are also subject to inherent risks and uncertainties that could cause actual results to differ materially from those expected. additional information concerning factors that could cause actual results to differ from those discussed in our forward-looking statement you should refer to the cautionary statements contained in our press release as well as the risk factors contained in the company's filings the securities and exchange commission bolero corporation undertakes no obligation to revise or update any forward-looking statements to reflect events or circumstances that occur after today's call Also, during today's call, the company may discuss certain non-GAAP financial measures as defined by SEC Regulation G. The GAAP financial measures most directly comparable to each non-GAAP financial measure discussed and the reconciliation of the differences between each non-GAAP financial measure and the comparable GAAP financial measure can be found on the company's website. I will now turn the call over to Tom.

Good afternoon. Thank you for joining us today. I am Thomas Shannon, founder and CEO of Bolero Corp. Total location revenue grew 17.5% year over year in the quarter. Our company's share of customer wallets continues to increase. Our locations get better every day through operational excellence and investments. After our superb quarter with 20 plus percent EBITDA growth and strong cash flow conversion, let me elaborate on our secret sauce. Almost 28 years ago, I found this company focusing on superior returns. We underwrite all decisions for relative financial returns and steadily focus on the highest returns. Since inception, I have focused the team on what generates the most significant impact on the business. From M&A decisions to capital investments to using data to drive labor pricing and supplier decisions, the team has held accountable for results in cash flow. As we grow, the results speak for themselves, and our ability to deploy capital and utilize data-driven processes is accelerating. The current macro environment has provided increasing opportunities to deploy capital beyond bowling. This spring, we acquired Raging Waves, the largest water park in Illinois, for $49 million, which included 52 acres of land. Through our early efforts, the business had double-digit revenue growth and will have $8 million of EBITDA in its first year under our ownership. At six times EBITDA, this deal is already a home run, and we have opportunities to expand the park and, if we choose so, monetize the land. Last month, we acquired Boomers, an underappreciated business with six family entertainment locations and two water parks. Within the first few weeks, we had begun shuttering unprofitable parts of the portfolio and introducing our labor model. We bought that business with $9 million of four wall EBITDA and expect meaningful upside in the short term from operations and longer term once we deploy capital. Today, we close on the acquisition of Spectrum Entertainment Complex in Grand Rapids, Michigan. This asset has revenues significantly above our center average and will be our sixth location in Michigan as we continue to drive scale. The market for M&A is the most opportunistic we have ever seen, and we look forward to continuing to deploy capital accretively, bringing attractive locations with significant upside into our portfolio. In October, we opened two Lucky Strike locations in Denver. In the coming months, Lucky Strike Beverly Hills will open as the first bowling alley in Beverly Hills in nearly a century. and it will be followed by Lucky Strike Ladera Ranch in Orange County, California, which will have 42 lanes and a very attractive demographic. Our new build pipeline is very robust for the next few years. Our focus is a balance of internal optimization and high return capital deployment. To discuss recent organic performance in our internal initiatives, let me hand it over to the company's president, Lev Ekster.

Thanks, Tom. Our food and beverage initiatives continue to bear fruit, with F&B sales up 18% year over year in the quarter, and our key KPI of retail F&B to bowling crossed 80 cents across the portfolio. Four new menu segments rolled out across all properties, from traditional all the way up to our new experiential craft menu. Most notable is that in our top 50 Bolero locations, which recently instituted the upgraded premium plus menu segment, trended close to $1.10 FMB per bowl this recent month, the highest we have ever seen and up over 18 cents versus prior year. So we are obviously highly encouraged by that. A brand new events menu launches in November, just in time for the start of the holiday season. We've also enabled mobile ordering across all properties, to help with labor efficiencies and get satisfaction. I'd also like to provide an update on the PBA. Last season, we achieved the record results with cumulative reach of 46% year over year and linear viewership numbers that even rivaled major league baseball levels, despite starting off the season by losing a headline sponsor. Going into the 2025 season, we've restructured the schedule and production strategy resulting in meaningful savings. That, coupled with bringing on new sponsors and the utilization of our newly acquired Thunder Bowl Lanes in Michigan, which features an arena, as a host center on the tour, we will ensure a successful season with thrilling televised experiences for our fans. I will now turn it over to Bobby Lavin.

Thanks, Lev. In the first quarter of 2025, we generated total revenue X service fee of $260 million. and an adjusted EBITDA of $62.9 million, compared to the last year of $226 million and an adjusted EBITDA of $52.1 million. Our total location revenue growth in the quarter was positive 17.5%, and same-store comp was positive 0.4%. Adjusted EBITDA was $62.9 million, up 21% year-over-year, with a margin of 24.2%, expanding 130 basis points. We have found a good balance of investing in payroll and managing costs, with our same-sort comp payroll better by $1 million year-over-year. Food costs are a headwind in the quarter, but have turned recently. The end of September was severely impacted by weather, including two hurricanes across the country. In our press release today, we updated our FY25 guidance. Our confidence in the business continues, and we are increasing the bottom end of our revenue range by $10 million. Boomers, which we have acquired on September 30th, will add revenue, but has negative EBITDA until peak season, which starts in June. We spent $41 million in capital expenditures in the first quarter. Growth CapEx was $16 million. New Build CapEx was $17 million. Maintenance was $8 million. We continue to optimize capital spend and recently hired a chief procurement officer to drive efficiencies. Our liquidity at the end of the quarter was $355 million, nothing drawn on a revolver, and $38 million of cash. Net debt was $1.1 billion, and the bank credit facility net leverage ratio was 2.6 times. Thank you for your time today, and we look forward to seeing you on the road in the coming months.

Ladies and gentlemen, we will now begin our question and answer session. If you have dialed in and would like to ask a question, please press star followed by the number one on your telephone keypad. If you would like to withdraw your question, simply press star one again. In order to accommodate everyone, we would like to ask you to please limit yourself to one question and one follow-up only. If you are called upon to ask your question and are listening via loudspeaker on your device, please pick up your handset and ensure that your phone is not on mute when asking your question. Our first question comes from the line of Matthew Boss with JP Morgan. Please go ahead.

Great, thanks. So, Tom, maybe to start off, could you elaborate on the cadence of theme center comps in the first quarter and trends you've seen in October, maybe between walk-ins and events?

Hey, Matt, it's Bobby. So, end of September, we got hit with two hurricanes, and that, you know, cost us about $2 million on the comp in the first quarter. You know, we'll see the equivalent of that into October. You know, October, the weather has not been great, but right now, events is tracking plus 10% for P6, which is really where we make a bulk of our revenue in EBITDA for the quarter. So we're more focused on that right now.

Great. And then maybe just a follow-up on the EBITDA margin expansion. So maybe just drivers of first quarter. and then any notable call-outs in terms of cadence for margin expansion as we think about the second quarter relative to the backcast.

Yeah, I mean, we're going to have the greatest margin expansion in the third quarter, right, because third quarter has sort of two benefits. One is New Year's has shifted from second quarter to third quarter, and that's a $5 million to $7 million swing in the comp between second quarter and third quarter, which is also going to have sort of the highest incrementals. You can also remember last year, January really started off rough with, you know, minus double digits for the first three weeks. So you'll see the greatest margin expansion in the third quarter, but you'll see margin expansion in the second quarter as well, other than boomers and raising waves will run through the income statement as negative EBITDA.

Great. Best of luck.

Your next question comes from the line of Steven Bezinski with Ethel. Please go ahead.

Hey, guys. Good afternoon. So, Bobby, just to kind of think about the rest of the fiscal year, you obviously took up your top line here a little bit in terms of guidance. You know, as we do think about that low to mid single digit same store sales comparison that you called out, I guess that was back in September when you gave your initial guidance for 25. Does that same store sales outlook still hold true? And, you know, if so, maybe how we should be thinking about the cadence of same store sales over the next, you know, over the next three quarters or so.

Yeah, I mean, we haven't changed anything as it relates to our expectation on the comp. You know, as we sort of went through last earnings call, 1Q and 2Q are going to be, you know, low comps versus 3Q and 4Q will be much stronger comps. You have two major things happening in the third quarter. So you've got New Year's, which is a very big night for us, does move from last year being in second quarter to this year being in the third quarter. I can't emphasize enough how important that is to sort of comp cadence. I mean, that's a $5 to $7 million move in comp. you know, on a $300-plus million sales base from 2Q to 3Q. On top of that, you're going to have, you know, this catch-up that happened last year where, you know, the weather was atrocious in January, and we had down, you know, double-digit weeks on the comp. So you'll catch all that up in the third quarter versus this quarter. You know, the weather has been great in October, but really December events will continue to be strong, but we'll miss that retail element of New Year's in the second quarter, and that will push the third quarter.

Okay, gotcha. Makes sense. And then maybe one for Tom or, you know, even you, Bobby. But, you know, you guys kind of talked about how the acquisition environment just remains, seems extremely robust. And, you know, just maybe wondering from a high-level perspective, I mean, how you guys are spending your time today in terms of looking at, you know, potential assets, meaning, you know, how much time is spent on your kind of core bowling assets versus, you know, some of the other assets that you've started to, you know, to take a look at. Thanks.

Well, it's a division of labor. This is Tom speaking. You know, Lev spends 100% of his time on our existing operations. Bobby spends most of his time on our existing operations, and I spend most of my time on M&A.

Okay. Fair enough. Thanks, guys. Appreciate it.

Your next question comes from the line of Randy Koenig with Jefferies. Please go ahead.

Hey guys, how are you? I guess I want to ask about the, you mentioned the increased utilization of data and you talked about some of the things you're doing there. And I think you mentioned that you hired a chief procurement officer. So it sounds like there's obviously, you know, you have a well-run organization and it sounds like you see some opportunities to continue to further make more efficiencies or drive more efficiencies through the portfolio. So can you guys basically unpack that a little bit more and give us some perspective on How are you utilizing data a little bit differently now versus maybe six, 12 months ago? And then your hopes for that chief procurement officer, what he or she will be focused on in terms of driving more efficiency and cost reduction through the business. Thanks, guys.

Yeah, we're becoming a data-driven organization. So at the end of the day, we're holding – we started off with – three Power BI subscriptions. So Tom, Lev, and myself, you know, we're using Power BI. Let's just kind of look at daily sales. We just pushed out 350 Power BI subscriptions. So now we have GMs. We have every department leader holding themselves accountable to day-to-day data. You know, as it relates to Chief Procurement Officer, you know, there's Managing inflation is kind of a core responsibility of the organization. Last year, chicken prices alone was a $6 million headwind. And having a chief procurement officer who your sole focus is to not necessarily reduce costs, but to at least keep costs flat is sort of core. And then Lev and I will focus on how do we drive efficiencies in the organization on payroll, on things like supplies, things like that. And ultimately, when we go back into a normal inflationary environment, we can use our scale to drive procurement synergies. I will say boomers, you know, we've owned a month, we already put sort of their purchasing organization into our purchasing organization. So there's just, you know, there's scale that comes in these acquisitions that, you know, we can underwrite EBITDA up without even a revenue growth just because of cost savings on the acquisitions.

Super helpful. And then I guess just to round out and lastly, um maybe give us some perspective on fall pass what's what's kind of different about it versus summer pass any kind of metrics you you want to kind of share with us in terms of that program and then just backing out a little bit more and thinking a little bit more strategic and long term How do you guys think about different past programs as we think through the, you know, going forward throughout the next few years? Are you going to look to maybe do a little bit more of an annual pass? Just how should we think about the past program and the benefits it's driving towards your business in terms of increased utilization, et cetera?

Yeah, this is Lev. How are you? Just to connect this question to your prior question on data, When we see revenue softness ahead, it gives us an opportunity to quickly deploy a pass. And seeing September, October gave us the push to launch the first ever fall season pass. Much shorter cycle for, first of all, sales, but also utilization of the pass for our customers. So that's actually coming to an end in about two weeks. But we've been encouraged by the results, and we were super successful with the summer season pass, not just in the sales, but also the number of redemptions we saw by the consumer and the MPS score and how favorable it was perceived by the consumer. In terms of future passes, I think we're going to probably lean in more into that summer season pass, launch a little earlier in the calendar year to have a larger window of sales. But It's really resonated with the consumer. I don't know that we really need to change too much. We might want to focus on the price and making sure we get maximum revenue, but still give a really good value to our consumer. I think the fall pass is going to relaunch again next year. Aside from that, I think the bigger opportunity is we have boomers now. We have the water parks now. Can we make it a bigger pass to connect all of these businesses and give an even more desirable product to the consumer, and that's something we're focused on right now.

Super helpful. Thanks, guys.

Thanks, Randy.

Our next question comes from the line of Ian Zaffino with Elkenheimer. Please go ahead.

Hi, Greg. Thank you very much. Question on price versus volume. You know, what are you kind of thinking going forward? ability to continue to push price versus volumes and just kind of overall what you really saw in the last quarter that kind of gives you confidence in going forward? Thanks.

Yeah, we've been able to take price on food. So that has been a positive surprise as we kind of lean into the core second and third quarter. Ultimately, that is a good opportunity for us, you know, where we can augment the price that's been taken on bowling the past few years and augment it with food.

Okay. And then on, you know, capital allocation, I guess buybacks kind of slowed a little bit, but, you know, how are we thinking about buybacks versus acquisitions and You know, on the acquisition front, I guess you also mentioned scale as a component. Are you talking about maybe, you know, adding, you know, additional kind of like-minded concepts, meaning like the more water parks you build, the more scale you're going to get? Is that kind of like what you meant there? And is that a factor in kind of any of your M&A? Thanks.

Yeah, I mean, we, you know, the acquisitions we closed on Spectrum today. Spectrum, you know, is a, you know, sizable entertainment company. bowling complex in Michigan. You know, we closed on Boomer on September 30th, which came with, you know, five FECs and one water park. You know, we're going to continue deploying capital where we can get superior returns. You know, and it's, you know, we like this slow and steady approach, you know, but there's a lot out there, and we'll look at everything, and that's how we kind of move forward.

Okay, and then just on biotech quickly.

Yeah, I mean, on buybacks, you know, we'll continue to be dynamic with how we buy back our stock. You know, we're very price sensitive and, you know, we look at our relative performance and we'll continue, you know, using buybacks and dividends to return, you know, to drive shareholder returns.

All right, great. Thank you very much.

Our next question comes from the line of Jeremy Hamblin with Craig Callum. Please go ahead.

Thanks and congrats on the strong results. I wanted to ask about mobile ordering and what you're seeing in terms of how that's impacting operations, how you're seeing customer respond to mobile ordering at your centers.

Hi, Les here. So as of last month, we've rolled mobile ordering across the entire organization. And we're seeing the utilization pick up. I think that, coupled with the data-driven approach we have right now on labor and being staffed as efficiently as possible, I think mobile ordering is really helping that cause. And I think you're seeing that in the results of our efficiencies. We're taking a step beyond that. So we're currently piloting tablets at a number of our locations right now. And we think We'll have that rolled across the organization early 2025, and I think that's going to improve efficiencies as well, but also customer satisfaction because we can take more orders faster, get them into the kitchen faster, get fresh hot food to the lanes faster, get more turns with the lanes as a result of that, but also get more items to the consumer during their session. So we have this holistic approach on expanding attachment of food and beverage sales right now. And I think mobile ordering, tablets, the revamp menus that we've rolled across the organization, enhanced training for our associates for sales, improving the hiring practices of our kitchen, all of this goes hand in hand. And I think you're starting to see that in the results. And you saw in our press release, The F&B to bowl KPI is growing significantly across the organization. All of this is correlated.

Got it. And just to follow up on that part, I think you had said that there was 80 cents of spend per dollar bowl, spend on bowling. How did that compare to last year?

and then also just understanding that in context of of what you got in the quarter uh at lucky strike uh versus uh the bolero uh banner well i think the purchase of lucky strike and seeing what they were doing in food and beverage sales relative to bowling revenue really gave us the push to really put a strong effort behind our food and beverage program across all of our properties that 80 cents compares to about 60 cents prior year. But what I think is most encouraging is at our top 50 Bolero locations that recently received our premium plus menu tier. So we have four menu tiers, traditional, premium, premium plus, and then this craft menu, which we refer to internally as our luxury menu at our top properties. But the 50 top Bolero locations that got that premium plus menu in October, they're F&B to bold. was around $1.10 or 18 cents more than prior year. So we're starting to see with these revamped menus and this focus on food and beverage sales, we can really drive the needle on attachments. The luckies are much higher if you just look at those on their own. Those are over $2 at the beautiful. So we're at 80 cents in the organization. We're starting to see us get over a dollar at those top 50 boleros, and I think we're going to continue to increase. I'd love to see us get closer to a dollar from that 80 cent mark. And, you know, based on the year over year jump, I think it's very doable.

Are those premium plus locations candidates to be re-bannered to Lucky Strike?

Yes.

Last one for me. I just wanted to clarify also, you noted, Bobby, with boomers that there would be drag on EBITDA until we get into the seasonal months. Can you just quantify what you expect that drag to be for the December quarter and then the March quarter?

Yeah, boomers plus racing waves is a few million dollars drag on EBITDA in 2Q and 3Q.

Each quarter or total? Each quarter. Each quarter. Awesome. Thanks for taking the questions. Best wishes. Thank you.

Our next question comes from the line of Jason Kilchen with Canaccord Genuity. Please go ahead.

Great. Thanks for taking my question. I'm wondering if you could share the relative growth rates you saw between walk-in and groups during the quarter and just the higher level, how you're feeling about the health of the consumer and expectations for consumer spending in the holiday season and also obviously the corporate booking pipeline that we had in the holiday season. Thanks.

Yeah, so walk-in in the quarter was higher than events and mainly because of the season pass. So we were getting, you know, we disclosed it last quarter, but for every season pass holder, they visited eight times. in the quarter um you know recently we've seen more strength and walk-in versus events but we expect that to kind of flip as we go into p6 for december quarter or december month okay great that's helpful and then just one follow-up in terms of the boomers acquisition why don't you take care a little bit more about if there's anything in particular that attracted you guys to that asset outside of sort of the valuation of the deal

and sort of how you're viewing other opportunities in family entertainment beyond just water parks?

Yeah, I mean, the valuation was extremely attractive, but it also, it's been sort of the prize of capital for at least five years. And so our ability to go put our events platform in, our procurement organization, our, you know, above market ability on Arcade, and really, you know, look at these assets that are, you know, irreplaceable assets in flagship locations and, you know, what kind of capital we put into them. Really, at the end of the day, the underwriting there was what we could do, not just what we were buying.

Great. Thank you very much.

Our next question comes from the line of Eric Wald with the Riley. Please go ahead.

Thanks. Good afternoon. A couple questions, a couple follow-up questions to what's been asked. I guess on the food and beverage ratio, I guess one, that $0.18 increase for the top 50 locations, how much of that was price? And then what would be your goal over the next 12 months in terms of the total network getting above that, moving above that $0.80 level?

Yeah, so none of it was price because we didn't take price until really, the past month on F&B. So it was purely, you know, good old elbow grease. You know, the ability to get the whole network up to a dollar is really going to be a multi-factor equation. So one, we just rolled out mobile ordering into, you know, all of our centers. That helps. But two, we are rolling out tablets or server tablets that should be company-wide by January, February. And the reason that those server tablets are so important is they prompt the server to upsell a double, you know, do you want fries with your burger, things like that. And so it really is we're leaning into sort of technology and process to drive that upside up.

You know, I don't know, Lev, if you'd add, you know, what's the... Yeah, I think this question alone, we could probably keep you on the line for an hour with this alone, but it really starts at the bottom, which is hiring. All of our managers now, we require food and beverage and hospitality experience on their resume. We have a brand new assessment for our kitchen manager and chef hires to get better talent there. We added some roles focused on food and beverage sales training, which we've never had before. So like I mentioned at the top of the call, it's really a holistic effort. It's not just taking price with the same product. It's a revamped menu, all new items, new taco selection, craft pizzas, more trending items. So we're giving a better product to the consumer and we're getting better at selling it through our people and through technology. That's how we're getting it to a dollar.

got it and then last question um maybe in this macro kind of talk about the the average customer you're seeing obviously you're working on getting you know higher food and beverage the new venues but in terms of just the customer coming in the door you know any shift in terms of general spending levels number of games played anything that can give you a another kind of look into what that customer demographic looks like versus maybe what you would have had you know a year or so ago

Yeah, I think generally, you know, it's steady as you go on the regular way customer. You know, we're seeing an uptake on the F&B. The only place that we're seeing a little softness would be on sort of corporates in front of this uncertainty of the election. But generally, you know, things are moving forward.

Perfect. Thank you.

Question. from the Lion Affair of Canada with Trott Capital. Please go ahead.

Yes, thank you for the question. You've now left your one-year anniversary for Lucky Strike. Can you maybe talk about what's happened to the Lucky Strike assets over the last year and what kind of returns you're getting and just some of your overall findings there?

Yeah, so 11 of the 14 assets are outperforming. You know, we're pretty excited about the, you know, when we got in there, their California assets were falling down. And now, you know, we picked that up with sort of new initiatives we've invested in for putting arcades in, revamped sort of the CapEx. So overall, like the returns there are exactly what we underwrote, which is, you know, we said we bought it for $90 million. Day one, it had four wall of 17. You know, that's up significantly from then, you know, really targeting sort of getting them to $30 million of EBITDA in the first sort of two years of owning it.

Great. And then secondly, can you talk about how your recent new build openings are doing and are they all profitable at this point?

Well, every one of our centers is profitable. We don't have a single center in the fleet that is unprofitable. You know, every cohort of new builds is better and better than the last. So, you know, Miami, which opened about seven months ago, is on pace to do $10 million in its first year, far ahead of where we underwrote that deal. Let's see, what did we open after Miami? Yeah, so we just opened two in Denver. I mean, they just opened, but, you know, the early indication is very positive. But, you know, our new builds are consistently doing eight plus million on average versus a portfolio average of about 3.3 to 3.5. So, you know, the beauty of new builds is you get to cherry pick your location. We only go into A locations. So this latest cohort, the two in Denver, which are one in Northfield, one in Southlands, Beverly Hills, which will open soon, the first bowling alley in Beverly Hills really in anyone's memory, maybe ever. We haven't found a bowling alley in Beverly Hills before, but I don't want to say never, but it's been a really, really long time. if there was one, and then in Ladera Ranch in Orange County, California, which is likely to open this calendar year as well. And then, you know, we have 15 plus in the pipeline behind that that are in various stages. Some are at least, some have signed LOIs, some are close to LOI, and those are all in exceptional locations as well. So, you know, I think that one thing the company does very, very well is site selection. I think it's always done site selection well. We've only closed one location that we chose, and that was in, I don't know, 2002, 2003. So, yeah, the latest ones that we built have been wildly outperformed expectations, vastly outperformed the fleet average. There's no reason to think that the next cohort will do any worse.

That's helpful, Tom. And just one last thing. You guys did a very good new income statement presentation to give a better view of where costs are trending. Are you going to be giving sort of like restated quarters for historicals for the last year or so?

Yeah, it's filed with the 8K. It's filed with the 8K on the press release.

Perfect. Thank you. Our next question comes from the line of Michael Kupinski with Noble Capital Markets. Please go ahead.

Thank you. Congratulations on your quarter. A couple of questions. You were optimistic about the revamped event catering menu, and I know we kind of danced around some of the commentary about the impact of that, but can you give us some color on how event bookings are pacing for the holidays and maybe some color on the average event revenue at this point, what that's looking like?

Yeah, I mean, December right now is pacing, and December is sort of our Super Bowl, is pacing up 10% year-over-year for a combination of corporates and adults a la carte. So, you know, really we're getting both more events and higher dollar pickups So ultimately we expect the average event to be up, but we're pretty happy about that plus 10% so far.

That sounds terrific. And then in terms of raging waves, you indicated that additional space might be developed to expand the park to take advantage of the peaks and maybe even for events. And as you consider adding more water parks, are there opportunities to take advantage of off-season opportunities? And I was thinking maybe like, I don't know, ice skating, Christmas lights, or other events. Or is the park just shuttered during the winter? I guess my question is, I was wondering, are there opportunities to shave off some of the drag in off-season?

Well, there are. And some companies out there do those things regularly. and i think some of them actually do it successfully but the drag is mostly fixed so it's it's a handful of full-time employees um and then it's things like insurance and property taxes and and you know things of that nature so um you know the challenge is that you're not carrying a lot of labor. So let's take raging waves in Chicago, right? Your season's over by Labor Day because typically it's cold, although this year it got warm again in October, but that's not typical. So, you know, you let everyone go, everyone goes back to school or wherever, and then to staff up again is really a challenge. So you have to be really confident you're going to do an outsized revenue number to do it. Now, The second water park that we bought as part of the boomers acquisition is in Destin. And so unlike Raging Waves, which has a 85 to 90 day season, you know, Destin can have 120 to 140 day season. So it gives you a lot more optionality and it also makes you less dependent on you know, having a cold summer or a rainy summer, as we actually did in Raging Waves. You know, that was a surprising thing. We were up almost 10% in revenue, but we lost a lot of days to rain. We lost the last weekend because it was cold. And, you know, despite that, we did really well. There are those opportunities, but I don't think those are the needle movers and I wouldn't be so cognizant of the drag in the EBITDA drag is relatively minor. Um, it only looks big compared to when we're making money because in season, these assets are ridiculously profitable. We give a little bit of that back in the off season, but we're not, we're not giving back, you know, it's not big amounts.

Gotcha. In terms of acquisitions, would you then look – it really wouldn't matter where the parks were located in terms of location, weather patterns, and so forth, just because of that, right?

Yeah. I mean, one of the advantages of Raging Waves is it's a weather hedge. We have 20 centers in Chicago, so the first weekend we were supposed to open, actually the park didn't open because it was raining, and our 20 centers – in Chicago comped up in aggregate 100% year over year. So that's pretty good, right? We've looked at hedging whether by buying contracts, the insurance is sort of proven to be prohibitively expensive thus far. But then we found we had this natural hedge. So yeah, if you could have water parks where you have bowling centers, you've got that built in. And I think that's a good thing for us. It's not driving the decision. But we look on these things on a case-by-case basis. I mean, you would be surprised. We are constantly surprised at assets that are seemingly in the middle of nowhere. And I'm not talking about water parks specifically, just talking about all sorts of assets that do really, really well. So we cast a wide net. But as Bobby said earlier, we're driven by return. We have a very tight deal screen, as we always have, and thus far over almost 28 years, and we've generated wildly outsized returns. If you look at the investor presentation, you can see some of these returns, you know, 10x invested capital in very short periods of time. So I don't think the market gives us credit for how good we are as investors. The market, I think, has some understanding of how good we are as operators and But we may be better investors than we are operators. Certainly when you combine the two, it's very powerful. And, you know, if you take the time to go through and you look at the returns we've had on AMF, Brunswick, Bull America, Lucky Strike, Raging Waves, et cetera, we've generated really outsized returns in companies that most people gave up for debt.

Totally agree with that. Thanks for the color. Appreciate it.

As there are no further questions at this time, that concludes our Q&A session and today's conference call. Thank you for your participation. You may now disconnect.