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Soho House & Co Inc. Announces Fourth Quarter and Fiscal Year 2024 Results

LONDON--(BUSINESS WIRE)-- Soho House & Co Inc. (NYSE: SHCO) (鈥淪HCO,鈥� 鈥淐ompany,鈥� 鈥渨e鈥� or 鈥渙ur鈥�), a global membership platform that connects a vibrant, diverse, and global group of members, today announced results for the fourth quarter and fiscal year ended December 29, 2024.

Berenjak at DUMBO House, New York

Fourth Quarter 2024 Highlights

• Total revenues of $305.6 million, 5.4% year-over-year growth
• Membership revenues grew to $109.3 million, a 15.6% increase year-over-year
• In-House revenues of $123.4 million, down 1.5% year-over-year
  • Revenue Per Available Room (鈥淩evPAR鈥�) was 1% higher year-over-year on a like-for-like basis
• Other revenues of $72.8 million, up 3.8% year-over-year supported by strong growth in Soho Home
• Net loss attributable to Soho House & Co Inc. was $91.7 million or $0.47 per share, inclusive of $51.6 million non-cash FX losses and $19.8 million of non-cash impairment charges
• Adjusted EBITDA was $32.3 million, inclusive of $3.5 million out of period expenses related to Retail Inventory and Freight & Duty from 2022 & prior, $1.4 million out of period expense related to pre-paid rent from 2021, and $4.1 million expenses related to historical tax matters

Fiscal Year 2024 Highlights

• Fiscal Year 2024 Total revenues increased 7.0% year-over-year to $1,203.8 million
• Membership revenues of $418.0 million increased 17.2% year-over-year
• In-House revenues grew to $481.6 million, flat year-over-year
  • Revenue Per Available Room (鈥淩evPAR鈥�) was 1% higher year-over-year on a Like-for-Like basis
• Other revenues of $304.2 million, up 6.2% year-over-year supported by strong growth in Soho Home and Scorpios
• Net loss attributable to Soho House & Co Inc. was $163.0 million or $0.84 per share, inclusive of $22.7 million non-cash FX losses and $38.5 million of non-cash impairment charges
• Adjusted EBITDA was $131.9 million, up 14.1% from $115.6 million in fiscal year 2023, inclusive of the fourth quarter $3.5 million out of period expenses related to Retail Inventory and Freight & Duty from 2022 & prior, $1.4 million out of period expense related to pre-paid rent from 2021, and $4.1 million tax expenses related to historical tax matters, outlined above
• Successfully opened three new Soho Houses: Portland (March 2024), Sao Paulo (June 2024), and Mews House (September 2024), alongside Scorpios Bodrum (June 2024)
• Compared to the guidance we gave on December 19, 2024, we delivered on total Soho House members, Membership revenues, and Total revenues. Adjusted EBITDA was impacted by the out of period adjustments and tax expenses outlined above.

"The strong results we delivered in 2024 demonstrate our unrelenting focus on delivering the best member experience and operational excellence across 45 Houses around the world. We grew full year total revenues by 7% and increased adjusted EBITDA by 14%,鈥� said Andrew Carnie, CEO of Soho House & Co.

We continued to improve the value of Every House membership, introducing a stunning House in Sao Paulo, Brazil, opening our 16th House in North America with Soho House Portland, and Soho Mews House in Mayfair, London.

Looking ahead, I鈥檓 excited by the potential our operational and finance systems transformation will unlock, fundamentally changing the way we operate. These improvements will make us a more efficient, resilient and profitable business, giving us the confidence to drive long-term growth while staying true to what makes Soho House special.

I would like to thank our teams for their passion and hard work, and members around the world for their continued loyalty.鈥�

Transaction Update

As previously announced on December 19, 2024, the Company received an offer from a third-party consortium to take the Company private for $9.00 per share. The Company set up a Special Committee to assess the offer and the parties continue to assess the offer and a potential transaction, however no assurances can be given that the Special Committee鈥檚 assessment will result in any change in strategy, or if a transaction will be undertaken. The Company will make a further public comment regarding these matters at such time as there is a material development in the process.

Summary of Unaudited Financial Results for the Periods Ended December 29, 2024

We delivered the following highlights against our strategic priorities in the fourth quarter, 2024

1. Grow and Enhance Membership

• Membership continues to reach new highs benefiting from a record waitlist and continued high retention rates
• Soho House members grew to 212,447 from 208,078 in third quarter 2024, and 9.6% year-over-year
• Focused rollout of initiatives continue to improve member experience and service in our Houses, as illustrated by high member satisfaction scores

2. Operational Excellence to Drive Profitability

• We achieved fourth quarter 2024 Adjusted EBITDA of $32.3 million, with Adjusted EBITDA margins of 11%
• Adjusted EBITDA was impacted by $3.5 million of out of period expenses related to Retail inventory and Freight & Duty charges from 2022 & prior, a $1.4 million out of period expense related to pre-paid rent in 2021, and $4.1 million expense for liabilities related to historical tax matters
• Like-for-like Food & Beverage margins at our Houses improved compared to the fourth quarter 2023
• We have continued to progress on our operational and finance transformation, hiring a Chief Transformation Officer in November 2024 and selecting the system for our new finance ERP
• Further streamlined corporate support functions

Membership Summary for the Quarter Ended December 29, 2024

Memberships

• Total Members grew to 271,541 from 267,494 in third quarter 2024 and by 4.5% year-over-year
• Total Soho House Members grew to 212,447 from 208,078 in third quarter 2024, driven by continued high retention rates, alongside membership intakes in both new and existing Houses
• Other Memberships including Soho Friends and Soho Works was 59,094 members, a decrease of 322 from the end of the third quarter 2024

Financing

• SHCO ended fourth quarter 2024 with Cash and cash equivalents and Restricted cash of $156 million

Non-GAAP Financial Measures

This presentation contains certain financial measures, including Adjusted EBITDA, House-Level Contribution and Margin, Other Contribution and Margin, Net Debt and certain financial measures presented on a Constant Currency basis that are not required by, or presented in accordance with, accounting principles generally accepted in the United States of America (鈥楪AAP鈥�). We refer to these measures as 鈥榥on-GAAP financial measures.鈥� We use these non-GAAP financial measures when planning, monitoring and evaluating our performance. While we believe that these non-GAAP financial measures are useful in evaluating our business, this information should be considered as supplemental in nature and is not meant as a substitute for revenues or net income (loss), in each case as recognized in accordance with GAAP. In addition, other companies may calculate one or more of these measures differently, which reduces the usefulness of any such measure as a comparative measure. See below for a definition of these non-GAAP financial measures and a reconciliation to the most directly comparable GAAP financial measures.

We provide earnings guidance using both GAAP and non-GAAP financial measures. A reconciliation of the Company鈥檚 Adjusted EBITDA guidance to the most directly comparable GAAP financial measure cannot be provided without unreasonable efforts and is not provided herein because of the inherent difficulty in forecasting and quantifying certain amounts that are necessary for such reconciliations, including adjustments that are made for future changes in foreign exchange and the other adjustments reflected in our reconciliation of historical non-GAAP financial measures, the amounts of which, could be material.

The information in this presentation should be read in conjunction with our Annual and Quarterly Reports on Form 10-K and Form 10-Q and other information that we file with the SEC. The reconciliations of non-GAAP financial measures are an integral part of the information presented herein. You can access these documents on our website, , free of charge, as well as any amendments to those reports filed or furnished pursuant to Section 13(a) or 15(d) of the Exchange Act, as soon as reasonably practicable after such material is electronically filed with, or furnished to, the SEC. The information contained on our website is not incorporated by reference into, and should not be considered a part of, this presentation.

In addition, the SEC maintains a website that contains reports, proxy and information statements, and other information regarding issuers, including the Company, that file electronically with the SEC at .

The non-GAAP financial measures we use herein are defined by us as follows:

ADJUSTED EBITDA. Adjusted EBITDA is a supplemental measure of our performance. Adjusted EBITDA is defined as Net income (loss) before Depreciation and amortization, Interest expense, net, Income tax (expense) benefit, adjusted to take account of the impact of certain non-cash and other items that we do not consider in our evaluation of ongoing operating performance. These other items include, but are not limited to, Gain (loss) on sale of property and other, net, Share of loss (profit) from equity method investments, Foreign exchange, Share of equity method investments adjusted EBITDA, Share-based compensation expense, impairment of intangible assets, and other applicable items. We believe that Adjusted EBITDA is an appropriate measure of operating performance because it eliminates the impact of expenses (income) that do not relate to ongoing business performance.

HOUSE-LEVEL CONTRIBUTION AND MARGIN. House-Level Contribution is defined as House Revenues less In-House operating expenses, which includes expense items such as food and beverage costs, labor costs, variable overheads and fixed costs, such as rent. It does not reflect the impact of depreciation, amortization, impairment, gain or loss on sale of property, general and administrative expenses or other applicable items. House-Level Contribution Margin is defined as House-Level Contribution as a percentage of our House Revenues and is a key determinant of our performance and profitability and our return on the investment we make in each of our Houses. Given that all costs associated with providing our members with the Soho House experience, including the costs associated with maintaining our Houses and providing services to members while in the Houses, are included in In-House operating expenses, we use House Revenues (inclusive of House Membership Revenues) in calculating House-Level Contribution and House-Level Contribution Margin to assess the overall profitability of our Houses. Accordingly, our management considers House-Level Contribution and House-Level Contribution Margin to be an important management measure to evaluate the performance of each House, and growth in aggregate House-Level Contribution allows us to leverage our general and administrative costs and improve overall profitability.

OTHER CONTRIBUTION AND MARGIN. Other Contribution is defined as Other revenues plus Non-House Membership Revenues less Other operating expenses, which includes expense items not related to the operation of Houses, such as labor costs, variable overheads and fixed costs, such as rent. It does not reflect the impact of depreciation, amortization, impairment, gain or loss on sale of property, general and administrative expenses, pre-opening expenses, foreign exchange gain/loss, Share-based compensation expense and other applicable items. Other Contribution Margin defined as Other Contribution as a percentage of our Other revenues and is a key determinant of our performance and profitability and our return on the investment in our non-House business. Our management considers Other Contribution and Contribution Margin to be an important management measure.

NET DEBT. Net Debt reflects the total debt, comprising long-term debt, property mortgage loans and related party loans, less cash, cash equivalents and restricted cash. Net Debt is an important measure to monitor leverage and evaluate the balance sheet. A limitation associated with using Net Debt is that it subtracts Cash and cash equivalents and Restricted cash and therefore may imply that there is less Company debt than the most comparable GAAP measure indicates. Management believes that investors may find it useful to monitor leverage and evaluate the balance sheet.

CONSTANT CURRENCY. Some of our financial and operational data that we disclose in this release is presented on a 鈥榗onstant currency鈥� basis to isolate the effect of currency changes during the period. Where we refer to a measure being calculated in 鈥榗onstant currency,鈥� we are calculating the dollar change and the percentage change as if the exchange rate that is being used in the current period was in effect for all prior periods presented. We believe that this calculation provides a more meaningful indication of actual year over year performance and eliminates any fluctuations from currency exchange rates.

While we believe that these non-GAAP financial measures are useful in evaluating our business, this information should be considered as supplemental in nature and is not meant as a substitute for revenues or net income (loss), in each case as recognized in accordance with GAAP. In addition, other companies may calculate one or more of these measures differently, which reduces the usefulness of any such measure as a comparative measure.

A reconciliation of Net income (loss) to Adjusted EBITDA for the 13 weeks ending December 29, 2024 and December 31, 2023 is set forth below:

A reconciliation of Operating income (loss) to House-Level Contribution & Other Contribution for the 13 weeks ending December 29, 2024 and December 31, 2023 is set forth below:

A reconciliation of Net loss to Adjusted EBITDA for the Fiscal Years ending December 29, 2024 and December 31, 2023 is set forth below:

A Reconciliation of Operating loss to House-Level Contribution & Other Contribution for the Fiscal Year ending December 29, 2024 and December 31, 2023 is set forth below:

A reconciliation of Net Debt as of December 29, 2024 and December 31, 2023 is set forth below:

Unaudited Consolidated Statements of Operations for fiscal years 2024 and 2023 and 13 weeks ended December 29, 2024 and December 31, 2023: