Dave & Buster's Entertainment, Inc. (NASDAQ:PLAY) Q3 2018 Earnings Conference Call - Final Transcript
Dec 11, 2018 • 05:00 pm ET
Good afternoon, everybody. Welcome to the Dave & Buster's Entertainment Incorporated Third Quarter 2018 Earnings Results Conference Call. Today's call is being hosted by Mr. Brian Jenkins, CEO. I'd like to remind everyone that today's call is being recorded and will be available for replay beginning later today.
Now I would like to turn the conference over to Mr. Arvind Bhatia, Director of IR, for opening remarks.
Thank you, John and thank you all for joining us. On the call today are Brian Jenkins, CEO; and Joe DeProspero, Interim CFO. After comments from Mr. Jenkins and Mr. DeProspero, we will be happy to take your question. This call is being recorded on behalf of Dave & Buster's Entertainment Incorporated and is copyrighted.
(Forward-Looking Cautionary Statements)
In addition, our remarks today will include references to EBITDA, adjusted EBITDA and store operating income before depreciation and amortization, which are financial measures that are not defined under Generally Accepted Accounting Principles. Investors should review the reconciliation of these non-GAAP measures to the comparable GAAP results contained in our earnings announcement released this afternoon, which is also available on our website.
Now I will turn the call over to Brian.
Thank you, Arvind. Good afternoon, everyone and thank you for joining our call today. Well, I'm encouraged by our third quarter results and progress on our strategic priority. On a comparable week basis, we grew revenue by over 15%, EBITDA by 11%, and drove sequential improvement in comp store sales, including positive comps in amusement. At the same time, new store performance remained strong. Our 2017 class of stores is on track to generate first year cash on cash returns of about 60%, one of our best in recent history.
As you may have seen, we are raising the lower end of our 2018 guidance on key performance metrics. With respect to fiscal 2019, we are confident in delivering yet another year of double-digit unit growth. We continue to be the leader in the combined dining and entertainment space and have the opportunity and resources to consistently grow units by more than 10% annually, while generating very strong returns.
Our capital allocation priorities include investing in unit growth, share repurchases and paying a quarterly cash dividend and we are delivering on all three.
Now let me update you on our four strategic priorities as an organization. First, we are evolving the offering to drive greater differentiation including, introducing compelling games and enhancing our food and beverage. In terms of amusement, we are pleased with the continued strength of Jurassic World VR Expedition, as well as Halo: Fireteam Raven, our Q2 titles. During Q3, we introduced Connect 4 Hoops, already a top performing game for us. And in time for Halloween, House of the Dead: Scarlet Dawn, the next entry in Vegas highly popular House of the Dead series.
Looking forward, we are pleased to announce our second VR title, Dragonfrost. Going (ph) for release next week, this proprietary VR title based on original content is