Lucky Strike (NYSE:LUCK) reported fourth-quarter financial results on Thursday. The transcript from the company's fourth-quarter earnings call has been provided below.
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Access the full call at https://events.q4inc.com/attendee/162604190
Summary
Lucky Strike Entertainment reported a 4% increase in total revenue to $1.245 billion, with an adjusted EBITDA of $333 million for fiscal 2026, despite facing challenges such as the World Cup and Middle East conflicts affecting consumer confidence.
Same-store sales showed improvement, with a -0.2% comp, a 3.5 point improvement from the prior year. Key segments like retail, bowling, and food showed positive comps, with events turning positive in recent months.
The company plans to focus on optimizing marketing investments for higher returns in fiscal 2027, with a conservative EBITDA guidance of $340 to $360 million, reflecting caution due to macroeconomic uncertainties.
Operationally, the company expanded its water park operations, directly managing five parks and seeing significant increases in per capita spending and EBITDA from these assets.
Management highlighted cost-saving initiatives, including a reduction in capital expenditures by 19% and significant advancements in labor management through AI and data analytics.
Full Transcript
OPERATOR
2026 earnings conference call. After today's prepared remarks, we will host a question and answer session. If you would like to ask a question, please press star one to raise your hand. To withdraw your question, please press star one again. I will now hand the conference over to Bobby Lavin, Chief Financial Officer. Bobby, please go ahead.
Bobby Lavin, President and Chief Financial Officer
Good morning to everyone on the call. This is Bobby Lavin, Lucky Strike's President and Chief Financial Officer. Welcome to our conference call to discuss Lucky Strike's fourth quarter 2026 earnings. Today we issued a press release announcing our financial results for the period ending June 29, 2026. A copy of the press release is available in the Investor Relations section of our website. Joining me on the call today, Thomas Shannon, our Founder and Chief Executive.
I would like to remind you that during today's conference call we may make certain forward-looking statements about the Company's performance. Such forward-looking statements are not guarantees of future performance and therefore one should not place undue reliance on them. Forward-looking statements are also subject to inherent risks and uncertainties that could cause actual results to differ materially from those expressed. Additional information concerning factors that could cause actual results to differ from those discussed in our forward-looking statements can be found in the cautionary statements contained in our press release as well as the risk factors contained in the Company's filings with the SEC. Lucky Strike Entertainment undertakes no obligation to revise or update any forward-looking statements to reflect events or circumstances that occur after today's call. Also during today's call, the Company may discuss certain non-GAAP financial measures as defined by SEC Regulation G. The GAAP financial measure most directly comparable to each non-GAAP financial measure discussed and the reconciliation of the differences between each non-GAAP financial measure and the comparable GAAP financial measure can be found on the Company's website.
I will now turn the call over to Tom.
Tom Shannon, Founder and Chief Executive
Thanks everyone for joining today's call. Despite a weak consumer at the lower end of the K and general macro uncertainty, we finished fiscal 2026 with a same-store sales comp of minus 0.2%, a 3.5 point improvement over the prior year and our best comp performance since fiscal 2023. Total revenue grew 4% to $1.245 billion and adjusted EBITDA was $333 million, reflecting a year of deliberate investment in marketing and our water park platform and in the technology and leadership that position us for fiscal 2027.
Had it not been for the World Cup and its record-breaking viewership and the conflict in the Middle East that drove consumer confidence to its lowest level in 70 years, our full year comp would almost certainly have been positive. There are green shoots across the business and they are broadening. Ex-California, the company comped up plus 0.9% for the year. Retail, bowling and shoe revenue comped plus 2.9%. Leagues grew plus 3.6% and accelerated in each of the last four months.
Food comped plus 8% and events, one of our most important product lines, turned positive in May and June for the first time since 2024, and remained positive in July and August, its best stretch in years. The fourth quarter started well. April was roughly flat, May swung to plus 2% and we entered June with strong momentum. That momentum was disrupted by an extraordinary stretch of at-home sports viewership. On June 11, the most watched World Cup in American television history kicked off on home soil for the first time in a generation.
The July 19 World Cup final drew roughly 66 million viewers across platforms, the largest American television audience since the Super Bowl. Layered on top of that, the Knicks won their first NBA title in 53 years in the most watched Finals in 28 years, averaging more than 20 million viewers a night in our largest market. With 33 million people watching the final game, for five straight weeks millions of consumers who would ordinarily be bowling on a Friday or Saturday night were watching sports from home.
June comped -7% and pulled an otherwise positive quarter and year slightly into the negative. I want to be precise about what that was and what it was not. It was not a weakening consumer. As we have seen through every exogenous shock since I started this company, the consumer has a short memory and adjusts to new realities quickly, and that is exactly what happened here. Our trends inflected the week after the final and August is rebounding. It was a one-time five-week programming event on home soil and it does not repeat next summer.
California remains our weakest market, but it is trending better. We made meaningful upgrades to the operating team there, including replacing leadership, and we are overhauling our corporate sales organization in the state. As I outlined on our last call, the full earnings benefit of the cost actions we took beginning in mid-January would land in the fourth quarter. And that is exactly what happened. The second quarter's $6 million payroll overrun became a payroll tailwind in the fourth quarter and remained one in July.
We made significant advancements this year in analytics, pricing, leagues and capital efficiency. And with AI, our data and insights into the business are accelerating and our ability to optimize key functions like labor management. We reduced capital expenditures by 19% to $114 million from $141 million last year and $194 million two years ago. This is a reduction of $80 million in two years. On marketing, not all of our spending delivered the ROI we expected.
We doubled working media and gained significant awareness, but the creative did not generate enough intent. Going forward, our investments will be more targeted, more measurable and held to a higher return threshold in fiscal 2027. Every marketing dollar needs to generate a return. Otherwise we will consider reducing marketing as a percentage of revenue. Water parks represented the largest operational change of our summer. A year ago we directly managed two water parks.
This summer we directly managed five, including Raging Waters Los Angeles, which we closed on in January for $45 million. We are in five really good markets with very strong positions: the largest water parks in North Carolina, Illinois and California, and two very good parks in the Florida Panhandle. That is a step change in operating complexity and the organization rose to it. Strategically, the season was about striking the right balance between price, attendance and labor across the water park portfolio.
Per capita spending is up double digits and payroll is down mid-single digits. As we staff to demand, price and cost discipline held what weather took, and it is the same pattern the large regional park operators described in their calls this month: attendance pressured by weather, per capita spending up and the economics protected through revenue management. The weather impact was real and concentrated. Raging Waves, our 54-acre water park outside Chicago, saw attendance fall significantly against a June that ran cooler than normal with rainfall well above normal.
As I've said before, in this business pricing has a lot less to do with demand than weather and a water park cannot comp through a cold, wet summer month. We remain very bullish here. I described the water parks as a coiled spring. On a trailing 12-month basis through July the water parks produced $56 million of revenue and $22 million of EBITDA, up from $23 million of revenue and $11 million of EBITDA in fiscal 2025. Roughly 80% of summer water park earnings land in our September quarter, which is in fiscal 2027.
The business is highly countercyclical and will only get better as we become more experienced operators in this business. The fixes for next season are simple: sell season passes earlier to hedge out weather and further optimize price and admissions. We are very happy with our Boomers parks, which are counter-seasonal, high margin and EBITDA positive in every period, delivering $11 million of EBITDA this year, nearly double the prior year. Turning to guidance for fiscal 2027.
We expect adjusted EBITDA of $340 to $360 million. We run a short-cycle business and we do not give guidance blindly or optimistically. So we are deliberately guiding conservatively as we work through the year. Importantly, this range reflects prudence around the environment, not the trajectory of our plan. The consumer has already told us in August that they want what we sell. And the keys to this year will be events booking for December and a clean second half after more disturbances than we have ever seen historically.
Thank you. With that, let's turn it over to Q&A.
OPERATOR
We will now begin the question and answer session. Please limit yourself to one question and one follow-up. If you would like to ask a question, please press star one to raise your hand. To withdraw your question, please press star one again. We ask that you pick up your handset when asking a question to allow for optimum sound quality, and if you are muted locally, please remember to unmute your device. Please stand by while we compile the Q&A roster.
Your first question comes from the line of Stephen Wojcinski from Stifel. Your line is open. Please go ahead.
Stephen Wojcinski, Analyst at Stifel
Hey guys. So Tom or Bobby, I mean, if we think about your guidance for this year, if we kind of, you know, look at where your assumptions around margins, I mean, you guys are kind of forecasting margins somewhere, I think it's a 27% number versus the 30% long-term target you laid out in the presentation. So, you know, as we think about fiscal year 27, wondering what might be weighing a little bit there on that margin versus your long-term goal. And I know you kind of called out maybe some marketing initiatives and some other things in there as well, but any kind of color around, you know, the margin target for this year versus the long-term target would be helpful. Thanks.
Tom Shannon, Founder and Chief Executive
Good morning. Yes. So we've spent a lot of time on this topic and we added a slide to our investor deck that will show you that $900 million of revenue of the portfolio runs at a 42% four-wall EBITDA margin, and all that's the pre-2022 properties. And then there is $300 million that runs at 30% and that's everything that we've invested in, built or acquired post-COVID. And when you look at the math there, when we get that $300 million up, you get back to the 30%.
I think the 32% is a little bit harder to achieve in a world where we've taken marketing from 1% to 2.5% to 3% of revenue. I mean, that's just an automatic reduction in margin. But we're still very confident in the long term, 30 to 32. We just want to be prudent with our guide this year as we invest in marketing, as we invest in systems, as we continue to ramp the water parks, making sure that the organizational structure is there. But ultimately this continues to be an investment year.
We're pretty happy with the trajectory we're on.
Stephen Wojcinski, Analyst at Stifel
Okay, gotcha. And then, Bobby, probably one for you as well, wondering maybe how we should think about cadence, you know, same-store sales cadence for fiscal year 27. You know, your commentary, I think Tom's commentary around July and August were positive.
Bobby Lavin, President and Chief Financial Officer
That sounds good.
Stephen Wojcinski, Analyst at Stifel
So it sounds like the first quarter should be, you know, positive just based on maybe how September ends up, but any color around the last three quarters of the year in terms of how you guys are maybe—I know it's tough to kind of forecast that—but, you know, what you guys are kind of thinking from a same-store sales perspective. And then maybe, you know, anything from a headwind or tailwind for the last three quarters of the year as well that we should be thinking about?
Bobby Lavin, President and Chief Financial Officer
Yeah. So moving backwards, you know, June was the worst month I've ever seen here. And so that is going to be a tailwind next year. We're not going to have the World Cup, and, you know, hopefully the weather in Chicago is better. So June has some tailwinds. Last year we had about 10 million of revenue hit from two different distinct snowstorms in the March quarter. And the weather is the weather. But ultimately those were very unique. The quarter that I'm most focused on is our December quarter.
We have completely restructured our events platform. You know, events, as we've talked about a lot, has been this 40 million top-line drawdown over the past three years. And, you know, that business has been positive for the past four months. But most importantly, going into the end of September, last year the December backlog was tracking down 30. This year it's tracking up 10. So we feel, you know, and it's still early and that's on a lower base of events, but we're pretty happy with where events is going.
And if the trajectory stays, you know, the December quarter is going to be a proof of concept that we can execute on the initiatives we lay out.
UNKNOWN Analyst
Okay, gotcha. Thanks, guys. Appreciate it.
OPERATOR
Your next question comes from the line of Eric Handler from Roth Capital. Your line is open. Please go ahead.
Eric Handler, Analyst at Roth Capital
Yes, good morning. Thanks for the question. Wonder if we could dig in a little deeper on events. You know, a while back, you talked about how you were moving salespeople back into the facilities, and there were various initiatives to get the local community, you know, to come in and have, like, tasting programs and everything. You know, what's been going on there and how are you seeing the results from that?
Bobby Lavin, President and Chief Financial Officer
Yes. So we are moving the business forward every day. On July 1, we announced a full restructure. We went to a hybrid model where we have a split of our inbound business between huge companies and localized companies. And then we have our call center, which used to be unique to individual centers, is now covering, you know, parties sub 12. So it's a very rebalanced structure where the team can focus on outbound. And, you know, it's still early, but we're seeing the fruits of the labor there where we're developing clients.
We had a client this week who was going to have a party in, you know, in New York, and their other offices grabbed on and had parties as well. So it's sort of everybody in the company was doing the same thing, and we're really building that outbound structure. And so, again, you know, this 40 million that we've lost over the past three years I think is very achievable to rebuild over the next few years.
Eric Handler, Analyst at Roth Capital
Great, that's helpful. And then, you know, digging in a little bit more on SG&A was up a good amount year over year and sequentially. How much of that was due to promotion of the water parks? How much, you know, where... Where was... What were the initiatives that didn't play out as expected? And, you know, what are some of the shifts that you're planning here?
Bobby Lavin, President and Chief Financial Officer
Yeah, I mean, the biggest thing is we are releasing a new CRM in October. And so those investments have been very heavy in the June and September, and they'll be heavy in the September quarter. It's the largest IT initiative the company's ever had. So those just flow through SG&A. SG&A sequentially is flat to down.
OPERATOR
Thank you for your question. Your next question comes from the line of Randy Koenig from Jefferies. Your line is open. Please go ahead.
Randy Koenig, Analyst at Jefferies
Thanks a lot and good morning, guys. I guess, Tom, in the presser and in your remarks on the quarter, you talked about end of year, you talked about the capital expenditures coming down fairly dramatically from peak levels. And I think there was a point made that those will continue to be kind of restrained going forward. Can you kind of elaborate on that? Let's dig into that a little bit more and think about on a multi-year basis, how do you think through what you believe is appropriate levels of capital expenditure in the business?
And then as you kind of look to generate, accelerate more free cash flow, how are you thinking about deploying that? Where are we with share purchase activity and so on and so forth? That'd be really helpful, thank you.
Tom Shannon, Founder and Chief Executive
Well, our CapEx budget for fiscal 2027 is 90 million, so it continues to trend meaningfully lower. In that number, we are finishing the remaining Lucky Strike rebrands and we are doing the AMF rebrands, most of which are already AMF, but not all. Some are transitioning from Bolero brand or an independent brand to AMF. So by the end of this fiscal year, I think we will have finished the rebrandings and we will only have two brands, which will make the marketing message much more focused and efficient: Lucky Strike and AMF.
There's been in the last two years a significant amount of CapEx spent to sort of catch up deferred maintenance in the water parks and the Boomers that we acquired. And that wasn't a surprise; that was part of the investment thesis. And we bought these assets at very attractive prices, but there was a reason and they needed to be refreshed. So we're meaningfully through that cycle. We're also just much more efficient. So we've really become very, very good at doing large CapEx projects like a roof replacement or parking lot replacement or HVAC upgrade for close to half or even less than we were paying historically by using national vendors with national contracts and all of that. So I think ultimately CapEx, once we get through this rebranding cycle, will probably move into the 70 to 80 million dollar range. You know, again we peaked at, I think it was 194 two years ago, down to 114 in the last year and 90 budgeted for this year. So a pretty good trajectory.
Randy Koenig, Analyst at Jefferies
Great, super helpful. I guess, Bobby, when you look at the guidance, I think it's slightly up on EBITDA at the midpoint. When you think about, I guess, higher—excuse me, I was looking on different guidance—but when you look at the different holdbacks you talked about, let's say this year in the World Cup, investment in marketing, the difficult weather impacting the water parks, the California business being subdued or down maybe, could you kind of dimensionalize for us how impactful those items have been on the P&L, whether from a revenue perspective or an EBITDA perspective, to get some perspective of how potentially conservative this fiscal year guide could be for 2027?
Bobby Lavin, President and Chief Financial Officer
Yeah, so weather in the third quarter was 10 million. The World Cup was at least 7 million in June, if not 10 to 12. You know, we were tracking in May very—like I was super happy in May. You know, May we ended plus two, and the momentum out of that was great. And then June 3rd happened. And on June 3rd was the first night of the Knicks championship. And we looked at the numbers the next day and we're like, wow, this does not bode well for the World Cup.
So it's at least seven, if not 12, because the World Cup did go until July 19th. So you have, you know, frankly high single-digit, low double-digit comps the first few weeks of July. And then you had the water parks are about 3 to 5 million of incremental weather—like there's always some weather. So, you know, all of those are there. You know, that's what gives us confidence in a 1 to 3% compared to this year. But, you know, if things go our way, you know, it could be better, you know, if—but weather's something that, you know, we've found is more volatile lately.
So we're trying to not say, okay, everything's gonna be perfect. So those numbers are partially de-risked in the 1 to 3, but not fully de-risked.
Randy Koenig, Analyst at Jefferies
And maybe just finally, can you just give us a little bit more color on California in terms of just reminding us how big of a contribution it is to the business, how difficult it's been over the last year or two? You talked about changing leadership. Sounds like things are getting sequentially better, that is less negative. So just kind of unpack that a little bit more. And do you think California can turn positive this next fiscal year? And if so, you know, what quarter would that be most likely to occur in?
Thanks, guys.
Bobby Lavin, President and Chief Financial Officer
Yeah, so California comped minus four last year versus the rest of the company was plus one. So, you know, it's about 20% of the business. California is going to be driven by two things: retail, which, you know, we keep talking about marketing—marketing continues to get better, but I'm not going to say that that's, you know, going to be a key driver this year. Marketing—or California goes the way events go. So if events, you know, continues momentum, I would expect California to turn, but we're not factoring that into our forecast this year.
Randy Koenig, Analyst at Jefferies
Super helpful. Thanks, guys.
OPERATOR
Your next question comes from the line of Eric Wold from Texas Capital Securities. Your line is open. Please go ahead.
Eric Wold, Analyst at Texas Capital Securities
Thanks. Thanks, guys. So, two questions, I guess. First off, I know you mentioned, Bobby, a little bit on the parks in terms of trailing twelve months and the plan to sell season passes earlier to maybe hedge out the weather a little bit. Can you update us on the larger projects that are still at hand for the parks that you plan in the off-seasons and kind of what we could see next year from kind of capital improvements and new offerings that weren't there this year, what you think they could do?
Tom Shannon, Founder and Chief Executive
Hi, this is Tom Shannon. I'll take this one. So we didn't close on Raging Waters Los Angeles, which is our biggest park, until January, and we inherited a deficit, a significant deficit in season passes as a result. No season passes were really sold in the fall as the seller got ready to transact. The transaction was delayed because it required approval by LA County, which is the landlord for the park. And so, you know, the water parks were, you know, suboptimal.
Right. But we just acquired them and we just acquired the two biggest in the portfolio. So there are a lot of things that will be done better and certainly with more runway, one of which is, you know, having more of a runway to sell season passes, at least in our two biggest water parks. But also there were some decisions made last year to open the Panhandle parks later in the year and to keep them open later, which is happening. And so some of the revenue deficit in Q4 of fiscal 2026 is a result of not having the two parks in the Panhandle open earlier, but they are going to go later.
So let me just give you an interesting data point. Big Kahuna in Destin, Florida, has had a positive attendance comp in 25 out of the last 30 days, and Shipwreck Island in Panama City Beach has had a positive attendance comp in 19 out of the last 30 days. So a long summer season, and there were some pretty meaningful headwinds in the quarter that are not necessarily representative of, number one, the business as a whole water park business, but even of the summer, because there's a lot of this revenue that we can make up and will and probably have made up already in the first quarter of fiscal 27.
So it's hard to look at this business sort of on a snapshot basis, but I think that explains a little bit about what happened and a little bit about what's happened since the fiscal year ended. With regard to CapEx, there are some semi-large projects that we like to do—I say semi-large on the order of $5 million each—in Shipwreck Island and in Big Kahuna. I doubt if either of those will be approved in time to do in fiscal 27. So the CapEx in aggregate in the water parks will be pretty minimal, I would say, in all likelihood, this fiscal year.
And then in the following year, we'd like to do these two large slide towers that would have a lot of presence from the street and drive traffic, also increase, you know, the nature of the parks, broaden the audience a little bit. And so that 10, 10 million, give or take, is likely to happen in fiscal 28.
UNKNOWN Analyst
Got it. And then secondly, maybe I'll get us on where you are with the labor efficiency moves. And you talked a little bit about towards the end of the year, the savings kind of maybe baseball analogy, because how far along are you, what's been saved so far? How much more do you think you can pull out of the bowling centers, and how far have you taken those initiatives at the water parks and FECs?
Bobby Lavin, President and Chief Financial Officer
Yeah, so let's separate water parks and FECs and bowling, because water parks and FECs, we're still figuring out what's the optimal labor model. On bowling, we're running down a million year over year right now, so a million of savings a month. Our model assumes that that flattens out and that there's actually an inflationary adjustment on payroll as we invest in people, invest in bonuses deeper in the system that ultimately drive KPIs that drive revenue.
But it's a tailwind today, but I would assume it moderates to flat to some investments that drive revenue throughout the rest of the year.
UNKNOWN Analyst
Got it. Thank you both.
OPERATOR
Your next question comes from the line of Jeremy Hamblin from Craig-Hallum Capital. Your line is open. Please go ahead.
Jeremy Hamblin, Analyst at Craig-Hallum Capital
Thanks for taking the question. So you guys are reducing your capex spend as you absorb some of these initiatives in the parks. I wanted to just understand in terms of thinking about the go-forward, you've done several acquisitions here over the last few years. And in terms of thinking about the go-forward strategy, there's been a lot to absorb, including the FECs, which have probably a slightly different business model and certainly investment needs.
But just thinking about, should we expect here over the next year or two, as you absorb these, that there may be a kind of reduced acquisition strategy in total as you work on fine-tuning the operations for the water parks, or as you get through finishing the Lucky Strike conversions?
Tom Shannon, Founder and Chief Executive
Yeah, that is accurate to say we're still in the M&A game, but only opportunistically. We're not actively looking for deals because there is so much opportunity to optimize the existing portfolio. But I want to be very clear that we view the water park and FEC acquisitions as extremely good even when the year is not ideal. We're still in these for probably 6.5 to 7x. They are counter-seasonal, so we generated a lot of cash this summer that we wouldn't have otherwise.
Nearly every week, other than the last week of the month or first week of the month when rent is paid or interest is paid, was cash flow positive on an operating basis, which we've never seen before because things slow down on the bowling side in the summer. But with the addition of these assets, we generated a lot of cash, and so we feel really, really good about them. But we are focused on two things: operational improvements, organic EBITDA growth, and effective delevering.
Jeremy Hamblin, Analyst at Craig-Hallum Capital
Got it. And then, Tom, you noted that you're going to very carefully look at marketing investments that are being made and looking for high ROI on those investments. I think, Bobby, you said you've gone from 1% marketing budget to 2 or 2.5%. In terms of making those incremental investments, how are you viewing the channel of where you're spending on that? Do you feel like there's fine-tuning? And then how quickly do you get feedback on whether or not a particular marketing strategy has been effective or hitting the ROI that you're looking for?
Tom Shannon, Founder and Chief Executive
So, you know, we raised spend from 17 million to 30 million. Our impressions went from about 75 million a quarter to 350 million a quarter. But our engagement rate is not good enough. And so we're super focused on not taking the person who has intent to bowl and showing them our website more. We're focused on the people who don't necessarily have intent to bowl and getting them to want to bowl, and that is what we need to push this year. The feedback loop is instantaneous at this point.
We have a lot of data that's driving the engagement with our content. We continue to invest in content, and so ultimately we need to convert the people who don't have intent to intent, and that's where the growth will come from. We are seeing very significant growth in our lane reservations platform, which is the tip of the spear and the bottom of the funnel, and we need to continue to bring people in there that have more intent, and that's how we're looking at it.
Jeremy Hamblin, Analyst at Craig-Hallum Capital
Got it. And then just a quick follow-up: in terms of your marketing spend, how much of that spend is on your events business? It seems like that's quite a bit more volatile in general. Wondering what portion of your total marketing budget goes into the events portion of your business.
Tom Shannon, Founder and Chief Executive
Great question. It is none right now, so it is an opportunity.
Jeremy Hamblin, Analyst at Craig-Hallum Capital
Got it. Thanks so much. Best wishes.
OPERATOR
Your next question comes from the line of Michael Kupinsky from Noble Capital Markets. Please go ahead.
Michael Kupinsky, Analyst at Noble Capital Markets
Thank you for taking my questions. I just got a little color around the water parks a little bit. I know that you said that you're looking for higher per-cap spending and improved labor efficiency, and I was just wondering if you can maybe quantify the expected incremental revenue and EBITDA contribution from the water parks in fiscal 27, particularly in September. If you could just add a little bit more color there.
Bobby Lavin, President and Chief Financial Officer
Yeah, so TTM EBITDA in June was 14. Then it became 22 at the end of July. August is still not over, so we'll drive that TTM to 26 to 28, and then we'll have an incremental few million dollars more from September. One of the issues that Tom discussed is we do staff some of the water parks with J-1s, so these are international students who come in. Instead of them coming in in May, they came in for August and September, and so we're testing pushing the season out.
So there is a little bit of volatility in how much earnings we get in August and September, and that will also be dependent on the weather.
Michael Kupinsky, Analyst at Noble Capital Markets
Gotcha. And then you're mentioning the opportunity on events. How significant is events to the overall same-store revenue opportunity? And if you could just give us some sense of how bookings are going through the fall into the holiday periods.
Tom Shannon, Founder and Chief Executive
Yeah. So events has been the entire comp decline over the past three years. We quantified it; it's about 40 million that we had in '23 that we don't have today. Ultimately, on top of the quantum, there is an element of events—corporate events during the week is very tip of the spear to traffic. Ultimately, if you go to a company event, you walk in, you have the wow factor of the Lucky Strike, and you go, I'm bringing my kids this weekend. And so we've lost some of that over the past three years.
And ultimately our events business is a tiny percentage of the global or national events business, and so we just want to go out and get that business. From our perspective, December is our Super Bowl. Events becomes 40% of revenue in December. Last year, we were down the first two weeks of December, and so that business right now is tracking up.
Michael Kupinsky, Analyst at Noble Capital Markets
Gotcha. And if I could squeeze one more: you have in the past discussed rationalizing the location portfolio as capital intensity comes down. I was just wondering, how many of your locations would you characterize as underperforming? And then should investors expect a meaningful number of closures, sales, or other portfolio actions in fiscal 27?
Tom Shannon, Founder and Chief Executive
Well, in one sense, you could say they all underperform their potential. The number of centers that we have that are EBITDA negative is maybe two or three, one of which is a legacy property we inherited from when we bought Lucky Strike that we sort of knew we were just going to exit at the end of the lease term, which is coming up in the next 15 months or so. I would estimate in this fiscal year we'll probably shed on the order of 10 properties, and most or all of these are properties that we acquired in the last five years after we went public and we had a flurry of M&A activity, because there was a focus on unit count, which in retrospect was a mistake and a mistake that won't be repeated. So we're just rationalizing the portfolio. There won't be anything that I would characterize as seismic. It's really just getting rid of centers in markets where they're peripheral and they're more of a hassle to manage than they are really additive to the portfolio.
Bobby Lavin, President and Chief Financial Officer
Yeah, and we're very focused on leverage. And so if we have properties that, on a four-wall basis, we can sell at an accretive leverage multiple—and when you blow it down and say, what does it cost to send the field there, what does IT support, what does insurance support—it's very accretive to our leverage position to sell some of these fringe assets. And we've done a comprehensive review, looked at land values, go-dark values, and ultimately there is an ability to use asset sales to de-lever the business.
Michael Kupinsky, Analyst at Noble Capital Markets
Great, thanks for taking my questions.
OPERATOR
Your next question comes from the line of Ian Zaffino from Oppenheimer. Please go ahead.
Ian Zaffino, Analyst at Oppenheimer
Hi Gray, thank you very much. I just wanted to kind of key into the comment about the per caps in water parks. What basically is driving some of that, call it pricing power, maybe there versus your other concepts? What's been the differentiating factor there?
Tom Shannon, Founder and Chief Executive
Well, the per caps in the water park were up this year on the order of 15%—15% to 20% as a range. So we decided after last year, which was a pretty good year, that there were a lot of pricing opportunities. The season pass was simply too cheap last year in our view, and we took price. We introduced a super-premium tier called Elite, and it surprisingly sold—about 10% of the season passes were the Elite. So there was demand at the high end certainly for that product, which was good.
We deemphasized the season pass this year and we were successful in driving up per cap. It was partially responsible for a decline in attendance. But our biggest water park in Los Angeles, it didn't reach 80 degrees there for the first month that it was open, and an air temp of 80 degrees is just not sufficient for a water park. The water temperature was frigid, so we lost—I don't know, I haven't done the math—but probably 60% of attendance; we were down probably 60% in that month.
Now it has rebounded. But one of the problems with having a slow start to the season is that that is when it's most attractive for someone to buy a season pass, because you get to amortize it over the rest of the summer. As you move through the summer, the season pass becomes relatively less attractive. We now view season pass in a completely different way than we did four months ago. Four months ago we viewed it really as a matter of pricing strategy and mix.
We now view it as weather insurance. And so if it had been a good weather season for the water parks, we would look really, really smart for holding onto this premium price model. The problem is that you can't predict the weather, and if you have, in the case of Raging Waters Los Angeles, a slow start to the season, or at Raging Waves in Yorkville, Illinois, an abnormally cold, rainy summer, you need that built-in season pass revenue to reduce volatility.
So this coming year we'll strike more of a balance between volume and price, and I think we'll get closer to optimal on that.
UNKNOWN Analyst
Okay, thank you. And then just as a follow‑up, Bobby, I know you said the trends were improving since, you know, your decline. But what are we kind of looking at now? We pegged at that 2% we saw in May. Is there any type of acceleration or any type of notable trends that you're seeing? Let's just say July and August. Thanks.
Bobby Lavin, President and Chief Financial Officer
Yeah, so, I mean, July we're going to have to carry the first two weeks, first two and a half weeks of the World Cup. So July, you know, was down low single digits. You know, August is flattening out, but it's not fully there. Events is strong, leagues is strong. You know, the school shift and the Labor Day shift's a little weird. So, you know, ultimately this weekend will be, you know, very important whether August flips positive or negative. And so ultimately, you know, we're more focused on the December quarter.
But, you know, generally, you know, we are expecting, you know, plus one to plus three throughout the year.
UNKNOWN Analyst
Okay, perfect. Thank you so much.
OPERATOR
Your next question comes from the line of David Hargreaves from Barclays Capital. Your line is open. Please go ahead.
David Hargreaves, Analyst at Barclays
Hi, good morning. If we look at the 2027 guide, 340 to 360, can you give us an idea of how much the contribution from the water parks and Boomers will be in that number?
Bobby Lavin, President and Chief Financial Officer
Yeah, water parks will be sort of somewhere between 28 and 33. That really comes down to how September plays out and how May and June next year play out. Boomers, which excludes Big Kahuna, which came with Boomers. Boomers right now is 11 million of EBITDA, and with all the capex we put in there, that's anywhere between 10 and 15 million the next 12 months.
David Hargreaves, Analyst at Barclays
Got it. And then if we take the midpoint of the guidance, interest and, I imagine, tax payments will be negligible. And 90 million at capex, I think free cash flow should probably be around 50 million. I'm just wondering if that's a fair number to assume.
Bobby Lavin, President and Chief Financial Officer
That is a fair number to assume. That does not include asset sales. About half of that we could assume maybe is debt repayment. The goal would be to pay down the revolver by June. So, yes.
David Hargreaves, Analyst at Barclays
Excellent. Thank you so much.
OPERATOR
Your next question comes from the line of Gregory Miller from Truist Securities. Your line is open. Please go ahead.
Gregory Miller, Analyst at Truist Securities
Thanks. Good morning, gentlemen. Just one question for me. I'd like to dive more into league performance if possible. And your engagement with league players saw a press release inter-quarter that spoke about the decision to invest in lane conditioning and oil patterns, and I'm curious if that was driven by customer surveys and just how important that is to their satisfaction as league bowlers. Thanks.
Tom Shannon, Founder and Chief Executive
I think machine reliability and lane conditions are critically important to the league bowlers and we are super focused on that now. We've made some structural changes to be able to ensure better machine reliability. We've upgraded the quality of the oil in league‑heavy houses and we're, you know, we're keeping a very close eye on it through feedback that we get both directly and through social media. So it's a big initiative. It coincides with a, I would say, reinvigorated league business.
The league business is outperforming all of our other business lines right now and it's an important business unit. It's 110 to 120 million before ancillary spend. And so, you know, we view it as a significant growth vector for us going forward, but we have to deliver the product.
OPERATOR
There are no further questions at this time and we have reached the end of the Q and A session. This concludes today's call. Thank you for attending. You may now disconnect.
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