Soho House & (US:SHCO)2022-08-17 18:50Financial Data and Key Metrics Changes - Total revenue grew almost 100% year-over-year, with an additional $10 million potential growth impacted by foreign exchange headwinds [34] - Adjusted EBITDA for Q2 was $15 million, exceeding consensus estimates, with a year-over-year increase of $28 million and a quarter-over-quarter increase of $30 million [23][37] - Net debt stood at $444 million at the end of the quarter, with cash and cash equivalents totaling $266 million [38][39] Business Line Data and Key Metrics Changes - In-house revenues increased by 140% year-over-year, driven by a 40% year-over-year increase in RevPAR [23][36] - Membership growth was strong, with 11,000 new Soho House members added since the last quarter, bringing the total to 142,000 members [17] - Soho Home sales rose by 105% year-over-year, indicating strong performance across other business lines [28] Market Data and Key Metrics Changes - The company added 10 new cities to its "Cities Without Houses" program, enhancing its global expansion strategy [15] - The waitlist for MCG memberships reached an all-time high of 82,000, reflecting strong demand [26] Company Strategy and Development Direction - The company focuses on six strategic priorities: global expansion of Soho House, enhancing membership value, ESG initiatives, operational excellence, growing new membership brands, and improving digital experiences [6] - The company plans to open nine new Soho Houses in 2022, with five already opened and four more expected by year-end [9][14] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the strength of membership demand despite economic challenges, with retention rates remaining around 95% [18] - The company anticipates continued strong performance in Europe, while acknowledging challenges in Hong Kong and foreign exchange impacts [40][46] Other Important Information - The company repurchased 2.3 million shares for $17 million during the second quarter [39] - The company is focused on generating free cash flow and expects to be cash flow positive in Q4 of this year [39] Q&A Session Summary Question: Pricing Power Discussion - Management indicated that pricing has been increased across all channels and they do not foresee further increases in the second half of the year, focusing instead on delivering value for members [50] Question: House Revenue Cadence - July trends continued strong, with like-for-like revenue growth for houses up about 13%, indicating positive momentum [52] Question: Performance During Economic Weakness - Management noted that historically, membership retention remains strong during recessions, with no significant drop-off in member spending observed [62][64] Question: Membership Quality Amid Rapid Growth - Management highlighted that there is currently high demand for membership applications, ensuring quality remains intact as the company expands [71][76]