After announcing a merger with Leo Holdings Corporation that would bring CEC Entertainment’s parent company, Queso Holdings, public in April, the operator of Chuck E. Cheese’s and Peter Piper Pizza turned in a robust first-quarter performance.
The roll out of All You Can Play and More Tickets initiatives for Chuck E. Cheese’s in Q4 helped the company generate a 7.7 percent bump in same-store sales.
"Our team continues to make great progress in advancing our brand and improving the experience we deliver to our guests,” Tom Leverton, chief executive officer, said said in a statement.
During Q1, CEC dedicated $4.9 million to growth initiatives and $13.3 million to game enhancements and venue maintenance. Leverton said the investments are being planned strategically and will lead to further profitability down the road.
“Since Apollo first acquired the company in 2014, CEC has made significant capital investments in PlayPass technology, store remodels, and the rollout of the All You Can Play initiative which have positioned CEC for tremendous continued growth opportunities going forward,” said Andrew Jhawar, senior partner and head of the consumer and retail group at Apollo and chairman of the board at CEC Entertainment.
During Q1, total revenue had a 7.2 percent or $18.4 million increase to $273.3 million compared to $254.9 million during the same time last year. As of March 31, 2019, CEC’s footprint was comprised of 606 Chuck E. Cheese’s and 142 Peter Piper Pizza locations. Chuck E. Cheese's units are averaging $1.6 million, while Peter Piper Pizza stores are at $1.8 million per restaurant.
Both Leo and Queso expect the merger to close during the second or third quarter of 2019. Leo Holdings will change its name to Chuck E. Cheese Brands Inc. when the new company is formed.
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