News

Chuck E. Cheese parent sees value/game initiatives paying off

July 1, 2019

The parent company of Chuck E. Cheese, CEC Entertainment, Inc, said its Q2 2019 financial results indicate that the brand's recently introduced "All You Can Play" game packages and More Tickets program are making a big impact on bottom line results this year, according to a news release.  

The company said for the first half of this year, comparable venue sales grew a healthy 4.5%, while Q2 comparable venue sales grew 0.4% for its Chuck E. Cheese and Peter Piper Pizza properties.

"We generated our fifth consecutive quarter of comparable venue sales growth due to the positive impact of the All You Can Play game packages and More Tickets initiatives — and despite the estimated 1.8% negative impact from the shift of Easter and the corresponding timing of spring breaks in the second quarter 2019 versus the first quarter 2018. ..." CEC Entertainment, Inc. CEO Tom Leverton said in the release. "Looking ahead, we are re-affirming the annual guidance that we first laid out in April. Our team is doing a solid job of advancing the Chuck E. Cheese brand through planned initiatives while simultaneously further improving the guest experience. We continue to be pleased with the results of our venue re-imaging project and are on track to complete the targeted 60 venue remodels in the back half of this year."

For the second quarter that ended on June 30, the company had 609 Chuck E. Cheese locations and 141 Peter Piper Pizza stores, for a total of 750 system-wide. The company opened three net international franchised Chuck E. Cheese and closed one Peter Piper Pizza franchise in the second quarter.

In a complex series of transactions that began last April, the company and additional investors are working to pay down debt and, as a result, support the future health of the restaurant concern. Most of those transactions are taking place between CEC parent company, Queso Holdings and the publicly traded special purpose acquisition company, Leo Holdings.

All the transactions are dependent on a vote of Leo shareholders set for the end of July, after which the business will be closed.  

The company reiterated its guidance for the year, including: 

• Total revenues of $929 million.
• Comparable venue sales growth of 4.2%.
• Adjusted EBITDA(1) of $187 million.
• Four net Peter Piper Pizza openings and 11 net international franchised Chuck E. Cheese openings.
• Capital expenditures of $95 million to $105 million.