Soho House & (SHCO) - 2025 Q3 - Quarterly Results

Financial Performance - Total revenues for Q3 2024 reached $333.4 million, representing a 13.6% year-over-year growth from Q3 2023[3]. - Adjusted EBITDA for Q3 2024 was$ 48.3 million, up $13.2 million from Q3 2023, with an adjusted EBITDA margin of 14%[3][5]. - Net income for the 13 weeks ended September 29, 2024, was$ 718, a significant improvement from a net loss of $(48,433) in the same period last year[20]. - Total revenues increased to$ 333,368, up 14% from $293,387 in the prior year[27]. - Adjusted EBITDA rose to$ 48,281, reflecting a 38% increase compared to $35,055 in the previous year[20]. - Operating income for the quarter was$ 37,884, compared to a loss of $(27,386) in the prior year[24]. - The company recognized$ 14 million in impairment losses on long-lived assets, primarily related to Soho Works North America[20]. - General and administrative expenses increased by 12% to $39,672, compared to$ 35,564 in the previous year[24]. Membership Growth - Membership revenues increased to $107.4 million, a 16.7% rise year-over-year, accounting for 32.2% of total revenues[3]. - Total members grew to 267,494, up 4.8% year-over-year, with Soho House members increasing to 208,078, a 13% year-over-year growth[3][6]. - The membership waitlist remains at approximately 111,000, indicating strong demand[3]. - The number of active users on the SH app increased to 212,993, up from 187,759 year-over-year[6]. Revenue Breakdown - In-House revenues increased to$ 120,658, up 5% from $115,223 in the previous year[27]. - Other revenues reached$ 105,316, a 22% increase compared to $86,115 in the same period last year[27]. - Membership revenues for the fiscal year were$ 272,809,000, unchanged from previous reports, indicating stable membership performance[41]. - In-house revenues increased to $427,209,000 after adjustments, showing a growth of 0.1%[41]. Financial Adjustments and Misstatements - The Company identified misstatements resulting in an understatement of net loss of$ 5 million in Fiscal 2022 and $7 million in Fiscal 2023, with additional impacts in Q1 and Q2 2024[31]. - Misstatements related to Soho Home sale transactions led to an understatement of net income by$ 2 million in Fiscal 2022 and less than $1 million in Fiscal 2023[32]. - The Company recognized an overstatement of Other revenues by$ 6 million in Q3 2023 and Fiscal 2023 due to incorrect revenue recognition practices[32]. - Adjustments to the income tax expense resulted in an overstatement of $4 million in Q1 2024 and$ 5 million in Q2 2024, cumulatively impacting net income by $9 million[32]. - The Company has determined that the misstatements did not result in material misstatements for previously presented financial statements but will impact the consolidated financial statements for the 52-week period ending December 29, 2024[34]. Operational Improvements - The company is implementing a new ERP system to enhance internal controls and support strategic growth initiatives[29]. - The ongoing remediation plan includes enhancing accounting staff skills and increasing the number of personnel in the finance department, particularly in the Americas[37]. - The Company will continue to engage with external consultants to strengthen internal controls and processes[37]. Market Expansion - As of September 29, 2024, Soho House & Co operates 45 Soho Houses and 8 Soho Works globally, indicating ongoing market expansion[48]. - The company emphasizes its unique position as the only company to have scaled a private membership network with a global presence since its inception in 1995[48]. - The company has a diverse portfolio that includes various hospitality and lifestyle brands, enhancing its market reach and member engagement[48].