ClubCorp — Q1 2016 Earnings Presentation
38 slides from ClubCorp's earnings presentation, Apr 27, 2016
Slide 1: Fiscal 2016 Q1 Performance
1 FISCAL 2016 Q1 PERFORMANCE April 27, 2016
Slide 2: Cautionary Statements
2 CAUTIONARY STATEMENTS Forward-Looking Statements Certain statements in this presentation may be considered forward-looking statements. Forward-looking statements generally relate to future events or our future financial or operating performance. In some cases, you can identify forward-looking stat
Slide 3: Business Overview
BUSINESS OVERVIEW ae
Slide 4: 1Q16 Performance
4 1Q16 PERFORMANCE Continued to execute our three-pronged growth strategy • We delivered outstanding first quarter 2016 results: » Record Q1 revenue up 6.3% year-over-year (y/y) to $214.9 million » Record Q1 adjusted EBITDA(1) up 8.2% y/y to $42.1 million » Q1 membership, excluding managed clubs, up
Slide 5: Why Invest in ClubCorp?
5 WHY INVEST IN CLUBCORP? Predictable and stable dues-based membership business resilient to swings in economy, weather and daily fee golf trends Operate clubs in economically stable neighborhoods superior demographics tied to mass affluent consumer Our clubs are located in in-fill locations high ba
Slide 6: Executing Our Growth Strategy
6 EXECUTING OUR GROWTH STRATEGY Three-pronged growth strategy focused on increasing long-term shareholder value Organic Growth Best-in-class, multi-functional clubs attract affluent member base Sticky membership product creates highly stable, highly resilient revenue base O.N.E. (Optimal Netwo
Slide 7: Organic Growth
7 ORGANIC GROWTH
Slide 8: Today's Private Club Experience
TODAY’S PRIVATE CLUB EXPERIENCE Membership is a lifestyle choice Appeals to multi-generational group of families or individuals seeking nearby, multi-faceted “sports resort” for recreational, leisure and social activities Traditional private club experience… » Exclusivity and status » Golf-centered
Slide 9: The ClubCorp Advantage
THE CLUBCORP ADVANTAGE The ClubCorp Network … delivers superior and differentiated value proposition ClubCorp Membership Benefits… » We give you access to our network » We focus on building relationships and enriching lives » We welcome families » We offer unrivaled golf and dining benefits » We inv
Slide 10: The Value of the ClubCorp Network
10 THE VALUE OF THE CLUBCORP NETWORK Our O.N.E. offering is unparalleled in the industry Increased adoption of the O.N.E. offering … generates favorable economics » Introduced O.N.E. in 2010 and rolling out at new and recently acquired clubs » O.N.E. is offered at 153 clubs(1) » O.N.E. increases rev
Slide 11: 1Q16 ClubCorp Same Store Results
11 1Q16 CLUBCORP SAME STORE RESULTS(1) Combined same-store clubs revenue growth up +4.0% and adj. EBITDA(2) growth up +7.4% 4.5% 9.1% Same-Store Revenue Same-store Adj. EBITDA (2) Same-store GCC Growth Year-over-year % (1) See our quarterly report on Form 10-Q for the period ended March 22, 2016 at
Slide 12: Reinvention
REINVENTION CLUBCORE
Slide 13: Reinvention
REINVENTION How Members engage and utilize their club are at the core of reinvention design Design Purpose Food & Beverage Service Programming Networking Technology 2008 psychographic Member study » During 2008, we conducted an in depth behavioral study to analyze how (past, current and prospective)
Slide 14: Reinvention Elements
14 REINVENTION ELEMENTS Reinventing and / or adding amenities that did not previously exist at the club
Slide 15: Oro Valley, AZ reinvention
CLUBCORP’ Oro Valley, AZ al i - : A Whiskey, ree wy, : : AFTER New Landon’s Grill
Slide 16: Gainey Ranch Golf Club
GAINEY RANCH GOLF CLUB Scottsdale, AZ se Pe = aq, ae ee AFTER ‘Cross Roads ‘Dining Rodm CLUBCORP’
Slide 17: The Woodlands, TX
CLUBCORP” The Woodlands, TX 1 cadens iw Privare C.uast : i i . 2016 m AFTER Legends Dining:at: The-Palmer Chabhouses <=
Slide 18: Acquisitions
18 ACQUISITIONS
Slide 19: Acquisition Strategy
ACQUISITION STRATEGY Scope, scale and expertise to successfully acquire and consolidate fragmented industry Successful acquisitions = sourcing strategy + post−acquisition synergies Sourcing… » Population density within a 10-15 mile radius » Affluence within 10-15 mile radius » Existing membership an
Slide 20: 2015 & 2016 Acquisitions
20 2015 & 2016 ACQUISITIONS Eleven new properties added since 2015, more than 3x our next closest competitor Bernardo Heights Country Club, San Diego, CA Marsh Creek Country Club, St. Augustine, FL 2016 Acquisitions » Santa Rosa Country Club, Santa Rosa, California – 18-hole, private » Marsh Creek C
Slide 21: Financial Overview
21 FINANCIAL OVERVIEW
Slide 22: 1Q2016 ClubCorp Consolidated Results
22 1Q2016 CLUBCORP CONSOLIDATED RESULTS Delivering results consistent with our key growth objectives $688 $720 $755 $815 $884 $1,053 $1,066 2010 2011 2012 2013 (53wks) 2014 2015 1Q16 LTM $149 $156 $165 $176 $196 $233 $237 21.8% 21.8% 21.9% 21.7% 22.2% 22.2% 22.2% 2010 2011 2012 2013 (53wks) 2014 201
Slide 23: 1Q16 ClubCorp Consolidated Results
23 1Q16 CLUBCORP CONSOLIDATED RESULTS Consolidated revenue growth up +6.3% and adj. EBITDA(1) growth up +8.2% 8.8% 11.6% Total Revenue Total Adj. EBITDA (1) Total GCC Growth Year-over-year % (1) Adjusted EBITDA is a non-GAAP measure. See Appendix for a reconciliation to the most comparable financial
Slide 24: 1Q16 Same-Store Combined Club Results
24 1Q16 SAME-STORE COMBINED CLUB RESULTS Ex-Houston, revenue and adj. EBITDA(1) growth accelerated in Texas during the 1Q 1Q16 Results (y/y %) • Total Same-store Combined Clubs: » Revenue $206.4M, 4.0% » Adj. EBITDA $56.6M, 7.4% • Texas Same-store Combined Clubs: » Revenue $66.4M, 5.8% » Adj.
Slide 25: 1Q16 Golf & Country Clubs (GCC)
25 1Q16 GOLF & COUNTRY CLUBS (GCC) Solid growth across key operating metrics 80,035 80,916 83,528 111,458 116,303 117,602 2011 Total 2012 Total 2013 Total 2014 Total 2015 Total 1Q16 55% Dues 20% F&B 18% Golf Ops 7% Other 1Q16 $172.8M Revenue Mix Memberships(2) 1.1% (1) Adjusted EBITDA is a non-GAAP
Slide 26: 1Q16 Business, Sports & Alumni Clubs (BSA)
26 1Q16 BUSINESS, SPORTS & ALUMNI CLUBS (BSA) Solid growth across key operating metrics 55,144 54,290 53,954 56,013 56,130 55,528 2011 Total 2012 Total 2013 Total 2014 Total 2015 Total 1Q16 47% Dues 46% F&B 7% Other 1Q16 $41.3M Revenue Mix Memberships(2) (1.1%) (1) Adjusted EBITDA is a non-GAAP mea
Slide 27: Maintenance vs. ROI Expansion Capex
27 MAINTENANCE VS. ROI EXPANSION CAPEX Maintenance Capex average 3.5% of revenue from 2010 to 2015 24.9 25.1 16.7 23.8 29.1 53.1 18.0 22.8 37.5 35.7 43.6 52.2 3.6% 3.5% 2.2% 2.9% 3.3% 5.0% 2.6% 3.2% 5.0% 4.4% 4.9% 5.0% 2010 2011 2012 2013 2014 2015 Maintenance vs. ROI Capex (2010 – 2015) Capex in $
Slide 28: 1Q16 Levered Free Cash Flow
28 1Q16 LEVERED FREE CASH FLOW Attractive FCF generation … $82.7 $87.2 $99.2 $109.8 $110.7 $112.5 $108.4 $104.9 $101.2 1Q14 LTM 2Q14 LTM 3Q14 LTM 4Q14 LTM 1Q15 LTM 2Q15 LTM 3Q15 LTM 4Q15 LTM 1Q16 LTM Levered Free Cash Flow • (8.4%) y/y decrease in LTM levered FCF • 1Q16 LTM cash interest expense(2)
Slide 29: Capital Structure
29 CAPITAL STRUCTURE Strong balance sheet 766 767 764 604 939 1,058 1,058 5.03 4.85 4.59 3.41 4.28 4.50 4.45 2010 2011 2012 2013 2014 2015 1Q16 Historical Debt & Liquidity Profile $ millions Adjusted Net Debt Total Leverage Ratio 4 29 3 675 350 2016 2017 2018 2019 2020 2021 2022 2023 Debt Maturities
Slide 30: 2016 Outlook
30 2016 OUTLOOK The Company is positioned for excellent results again in 2016 Keys to achieving 2016 outlook … » Solid Same-store growth and operational execution » Strong revenue growth across all three primary revenue streams: dues, F&B and golf operations » Economy continues to grow, with no sign
Slide 31: Appendix
APPENDIX CLUBCORT’
Slide 32: 1Q2016 Consolidated Results
32 1Q2016 CONSOLIDATED RESULTS Combined Same-store clubs and combined new or acquired clubs performance (1) Change compares first quarter ended March 22, 2016 (12 weeks) to first quarter ended March 24, 2015 (12 weeks) (2) When clubs are divested, the associated revenues are excluded from segment re
Slide 33: 1Q2016 Golf & Country Clubs (GCC)
33 1Q2016 GOLF & COUNTRY CLUBS (GCC) GCC Same-store clubs and GCC new or acquired clubs performance (1) Change compares first quarter ended March 22, 2016 (12 weeks) to first quarter ended March 24, 2015 (12 weeks)
Slide 34: 1Q2016 Business, Sports & Alumni Clubs (BSA)
34 1Q2016 BUSINESS, SPORTS & ALUMNI CLUBS (BSA) BSA Same-store clubs and BSA new or acquired clubs performance (1) Change compares first quarter ended March 22, 2016 (12 weeks) to first quarter ended March 24, 2015 (12 weeks)
Slide 35: Net Income to Adjusted EBITDA Reconciliation
35 NET INCOME TO ADJUSTED EBITDA RECONCILIATION OF NON-GAAP MEASURES TO CLOSEST GAAP MEASURE (1) Includes non-cash impairment charges related to property and equipment and intangible assets and loss on disposals of assets (including property and equipment disposed of in connection with renovations).
Slide 36: Houston and Texas Same-Store Adjusted EBITDA
36 HOUSTON AND TEXAS SAME-STORE ADJUSTED EBITDA RECONCILIATION OF HOUSTON AND TEXAS SS ADJ. EBITDA TO TOTAL ADJ. EBITDA (1) Includes same-store and new & acquired Golf and Country clubs and same-store and new & acquired Business Sports and Alumni clubs, other than the same-store clubs located in Tex
Slide 37: Calculation of Levered Free Cash Flow
37 CALCULATION OF LEVERED FREE CASH FLOW RECONCILIATION OF NON-GAAP MEASURES TO CLOSEST GAAP MEASURE (1) See the Adjusted EBITDA reconciliation in the preceding "Reconciliation of Non-GAAP Measures to Closest GAAP Measure" table. (2) Interest on long-term debt excludes accretion of discount on membe
Slide 38: ClubCorp
CLUBCORP THE WORLD LEADER IN PRIVATE CLURS®