8-K: Soho House & Co Inc. Announces First Quarter 2025 Results: Revenue Up 8%, Adjusted EBITDA Surges

Soho House & Co Inc. reports an 8% year-over-year increase in total revenue and a significant rise in Adjusted EBITDA for the first quarter of 2025.

Summary

• Soho House & Co Inc. announced its financial results for the first quarter ended March 30, 2025.
• Total revenues reached $282.9 million, representing an 8.0% year-over-year growth.
• Membership revenues increased to $112.9 million, a 14.1% rise compared to the previous year.
• In-House revenues grew to $112.4 million, a 1.9% increase year-over-year.
• Revenue Per Available Room (RevPAR) was 4% higher year-over-year on a like-for-like basis.
• Other revenues amounted to $57.5 million, up 9.1% year-over-year, driven by Soho Home's strong growth.
• Net income attributable to Soho House & Co Inc. was $8.2 million, or $0.04 per share.
• Adjusted EBITDA was $47.0 million, a significant increase from $19.8 million in the first quarter of 2024.
• The Adjusted EBITDA includes $22.9 million of business interruption insurance proceeds related to COVID-19.
• Total members grew 3.1% year-over-year to 269,636.
• Total Soho House Members grew 7.1% year-over-year to 212,001.
• Other Memberships including Soho Friends and Soho Works declined 9.3% year-over-year to 57,635 members.

Sentiment

Score: 8

Explanation: The document presents a positive outlook with strong revenue growth and improved profitability. While there are some risks and challenges, the overall tone is optimistic.

Positives

• The company experienced strong growth in total revenues and membership revenues.
• Adjusted EBITDA showed a substantial increase compared to the previous year.
• The company achieved net income attributable to Soho House & Co Inc.
• RevPAR increased, indicating improved accommodation performance.
• The company received a significant amount in business interruption insurance proceeds.
• Total members grew 3.1% year-over-year to 269,636.
• Total Soho House Members grew 7.1% year-over-year to 212,001.

Negatives

• Other Memberships including Soho Friends and Soho Works declined 9.3% year-over-year to 57,635 members.
• The company was negatively impacted by the Los Angeles wildfires, with an insurance claim of $3 million pending.

Risks

• The company is still assessing an offer to be taken private, and there is no guarantee that a transaction will occur.
• The company was negatively impacted by the Los Angeles wildfires, with an insurance claim of $3 million pending.
• Forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially.

Future Outlook

The company expects its strategic priorities to continue resonating with members, driving further growth and profitability.

Management Comments

• Our strong quarterly performance gives me confidence that our strategic priorities are resonating with our members around the world, with first quarter total revenues growing by 8% and significant growth in Adjusted EBITDA, said Andrew Carnie, CEO of Soho House & Co.
• We continue to elevate the Soho House member experience across our existing Houses globally, and with new openings including Soho Farmhouse Ibiza this summer.
• Our operational transformation is starting to gain real traction and were seeing early signs of this in profitability, giving us further confidence in the potential that lies ahead of us.
• I want to thank our teams for their passion and commitment, and our members for their continued loyalty especially those in Los Angeles who were affected by the devastating fires earlier this year.

Industry Context

The announcement reflects a positive trend in the hospitality sector, with membership-based models showing resilience and growth. Soho House's focus on enhancing member experience and expanding its global footprint aligns with industry trends.

Comparison to Industry Standards

• Comparing Soho House's RevPAR growth of 4% to major hotel chains like Marriott or Hilton would require adjusting for the unique membership-based model.
• Companies like Equinox or CorePower Yoga also operate on membership models, but their financial metrics are not directly comparable due to differences in services and scale.
• The growth in membership revenue is a key indicator, and benchmarking against other premium membership services could provide further insights.

Stakeholder Impact

• Shareholders will likely react positively to the improved financial performance.
• Employees can expect continued investment in member experience and operational improvements.
• Members will benefit from enhanced services and new House openings.
• Suppliers may see increased demand due to the company's growth.

Next Steps

• The company will continue to assess the offer to be taken private and make a further public comment when there is a material development.
• The company plans to open Soho Farmhouse Ibiza this summer.
• The company will continue to focus on operational excellence to drive profitability.

Key Dates

Keywords

Soho House, Membership, Revenue, EBITDA, Financial Results, Hospitality