Soho House & Co (SHCO) 26 Aug 212021 Q2 Earnings call transcript

Ladies and gentlemen, thank you for standing by. My name is Emma, your Chorus Call operator. Welcome, and thanks for joining the Membership Collective Group Second Quarter Earnings Conference Call. [Operator Instructions] And I would now like to turn the conference over to Rebecca Elena. Please go ahead.

us results. Membership joining quarter Group's for financial XXXX you for Collective the second Thank

begin, like today available information we various expectations be statements. These Before based I'd statements to risks made statements that forward-looking beliefs, reflects on us. may and certain on uncertainties this our subject our currently call are that and forward-looking to are to remind current everyone and assumptions

changes any that are reasonable, after we no statements Although, to believe revise reflect these expectations call. we occur obligation this undertake to

Descriptions factors results more the these are these and of with could other in cause to forward-looking risks actual detail discussed from filings that in our differ materially SEC. statements

to in comparable GAAP During GAAP Investor not to, earnings Relations measures. section non-GAAP most and financial www.membershipcollectivegroup.com. measures isolation results. Reconciliations our which a to available at in our are the press also available These for substitute from release, addition call, is website as refer our or certain today's in should we measures non-GAAP be of considered on

the who months I'm few MCG. the will by last Humera, of incredibly over take looking Hello, for and I'm all call and CFO. joining operational the you delighted welcome through quarter financial the Andrew been to second Founder some the results. The joined of President; to the you and to and of you you through exciting CEO Membership I'm last Collective and of thank Nick, to Andrew, us. highlights Group. Group I'm everyone, MCG, take Humera, handing earnings quarter before have and for the

our new for the York and business believe for people that MCG special potential contribution New our support a I'm huge work members, and IPO a is the hugely in Our marked space chapter the all and growth. and for us the MCG, for significant beginning who unique of with investors. We the and wide grateful exciting successful really of

us to positioned years. and extremely making last are better. focus we on even means, continue for well Membership to driven business XX growing listing Our on has the our what That's

been houses, Over and have as we the last workspaces few to have months, restrictions restaurants eased. reopen able our

full welcoming loved to still back we in back and we challenging of history, Houses Scorpios industry's to to the including and back London get Ned restrictions months and the to few living are Mykonos. fully business Europe. confidence recovery, COVID-XX with restrictions as ongoing sit world an we today, over seen around The mask periods Club America is in and that of the what be when our other me and gives the vaccine Beach we And mandates recent still have in will That to the last on We our Soho North lift, are the across members one to world impact having doing do best. Obviously, most have here finally said, COVID happy restrictions strength. our

retained cultures, city's that and by inspired a know beautiful colors the and a It's that interiors convent, house restored members have designed House Soho fact, Texas. of London against quarter, Aviv houses, we the in Originally backdrop Austin, we've in Jaffa X the here one built are of our as and features in District. the today, love. will we the influences. Tel opened last original opened and And In of challenging many one doors I

year, end will houses, we Looking new opened I'm in in England. and Paris, excited X anticipated X hugely that of by Rome Brighton the have ahead, the including locations

The is Paris to like demand, our open most seen city next and hugely city's bedrooms vibrant the never membership of and in one neighborhoods XX Rome, house Lorenzo apartments, is San for Century XX bedrooms quite of floors building, a the and our Italy. with heart XX former a in sits France in house been beautiful anticipation features anything the in first the houses opening is in spread of forward pool, years. over in that, Paris XXth I've month. Italy Soho many long-stay and Set Townhouse XX-story rooftop after House very Soho it. House X enormous, It's due again, us. Opening for to a looking I've exciting exciting.

to really overwhelmed going Membership is by I this our members. So loyalty this exciting Every be to about us. Again, period for all the be day, better. of making a is continue

in House has XX% increase exceptionally during retention been years strong, running the House. XX membership by quarter, anything pre-pandemic applications amazed like remained increase I've it versus levels. Soho membership and Our the been in never I've Soho seen the a for I've

list of high Our now record membership waiting XX,XXX. stands at a

this that allows relaunched platform Andrew that app, pocket. House House Soho we digital also More SH.APP, have the members Soho on our from their quarter, During bring later. into to the

me of Soho success newer across X,XXX Home+, Friends members tailored real memberships, members the in we brands, seen Beyond and just have Lounge House, growth Soho of Soho gives begun. these robust we've and Soho our future over confidence adding membership Works only new which members,

the more Now let me detail. through take who'll hand over to of you Andrew, some

our focus how quarter, membership, into how hand performance. insight about and growth Thanks, provide over and we're then plans delivering will reopened now more Nick. we talk to Humera on I financial our the performed for in

the subscription of to XXXX. our million, revenue increase Membership in-house recurring in million. revenues million with contribution terms up from we is members, XXX% for In XX% revenue, highlights, $XXX revenue. X,XXX $XX our grew to quarter QX to House XXX,XXX versus by and of rebounded which Total QX grew performance accounted XXXX. key an finished $XX XX%

Humera a EBITDA, back. $XX we includes is and million this unpack for our later. that was welcomed mentioned, fully will loss As that Nick preopening all members of burdened growth costs, a number our

whilst was restrictions closures started or By houses, our quarter our end our with first the a all have successfully quarter, of publicly As partial experience. Nick QX aspects houses. improving full We form company. all of mentioned, quarter traded member or our of across teams some reopened the in as the

us welcome released on out restrictions, to back, saw Soho a again, increases our daily our of within These momentum able showed Soho and an to houses the House with House, of our we members for Although, weekly back staying XX% are end across properties levels June beverage rate were members had and occupancy XX% average the daily properties. all we started House, to destination and our slots food booked basis so that leading we June and Babington strong all quarter, Soho to sales own so were often we still within rate were our and sold members Miami. much booking desperate the our occupancy come have throughout Farmhouse, some minutes. Encouragingly, of the European Beach and platforms, in increasing by XX% our by all

membership at subscription MCG. let me now our focus So unique performance on

I As achieved is over third membership our a by recurring fees. subscription of said, revenue

retention Our with strong. members continue in remaining the to membership rates show very quarter incredible loyalty

demand membership the a This House of applications accelerating types XX% resulted versus comparable period. in even an in by XX,XXX. the that were other plus while all-time of houses the restrictions particularly across for regions increased rate pre-pandemic and of spread through increase notable Soho closed all applications and houses high applications is waitlist strong, the with demand It June. remains With MCG weaker this to and an continue. trend to House enjoyment took we accepting houses the and Soho to XX,XXX, prioritize as globally This level members a the a to place. unfreeze quarter, confidence memberships shrinking of members saw new a gives they future expect number members during for high We of cautious of their high growth. We existing approach us of frozen in members reopen. were rate

We quarter. have normal member now intakes resumed the in third

We about North across mentioned, America. Austin to over Nick and more our new talk new X,XXX Now Soho let XXX welcome were houses in me members. London delighted in X that House, House members

welcomed new brands. membership members other also X,XXX We over our across

Soho delivered in a of terms Friends strong membership growth. quarter

continues nicely. Works progress Soho to

offer. May over trend program, are exclusive and from members. X,XXX increased access XX% Membership continues strong have reopened first flexible Ned, towards in membership very the offering quarter occupancy We Ned been the unique and Friends and the benefiting within office over additions grow. and we to and working Ned structural the to Ned We in have already members launched to spaces the our

London, were physical XXX in is total MCG. houses globally. now House move space, to and We two open which club mid-April. on and houses The to let's has waitlist. under quarter, XX house currently opened to ninth our So here in features in our House our bringing members a pleased pool rooftop the with XXXX-style XXX a and just openings growing interiors, large at a

in house Texas, over will waitlist, XX first membership also base pool, screening a enable room in features the members Soho house Austin, has and restaurants, which rooftop grow strong quickly a the with our and year. bedrooms, to XXX us House, a

X in are West and on further third with York, opened X by to Soho bringing as XXXX and of far the our Nick in New Houses on Francisco to as as S-X. X Line well will year, Soho a Houses we Manchester, so include line Nashville sites, growth a Soho open mentioned, City, our Scorpios, Ned end site. to other open which X, We track, Mexico Hollywood, with Works is In Ned, San a in well Cabo, XXXX, outlined Stockholm the further in X The track Tulum, total Berlin the which and have

our in XXXX execution. house the confident really this openings are with very pleased year's We growth and in we're that

digital MCG new House the them improvements and world. This One new Now features member COVID wherever map. updates Soho you to we to update and our relaunched features of initiatives. new proud create House and the features our are our our May, delivering members payment while innovation includes strategic redesigning of disruptions proprietary service are thing and help has platforms and booking digitally platform to the progress accelerate how digital they road I'd Connect, like in improve in house team our on most worked experience through to We app on for pay. in in connect connect introducing

engagement. significantly, table XX% all our launch are taken by House Unique and table at We global member plus in up app app on successful increasing bookings daily spent QX. is Soho time positive significantly The bookings the had seeing member usage XX%. trends is with of in a

to feature. members each through with Connect other connect Our started the House

Finally, are House We our the guest be for on houses register over our XXX,XXX be not us. Long a yet with about providing will all term, but Guest us visit globally. across this app, differentiator people to had key members. continues data invaluable data houses our used

Now to retail.

retail Home House Soho inspired allows sales versus in margin added XXX% delivered at the quarter another or second our find bring Home. to which our those Soho markdowns, the year, new higher members is increased over the only the of of leading which little a sales increasing execution Home. full increasing within were houses strong previous price unique with Gross with quarter. revenues for quarter in Home team. IMU which shows no XX% by We can Soho strength UPT, House to which both Soho segment, the of conversion sales. previous at in DTC product with to nicely you accounted growth XX% are and profit versus

available has which the design our XXX for AOV. new members, in Home+ revenue, gained only members we introduced big for We services and which a over House popular. quarter, Soho extremely of In contributed members, to increase interior proven account XX% Soho

Palm for enhanced continue Washington We to variety well food the beverage The X and offer we as we X,XXX agreements significant Line opportunity prospects hotel in D.C., further about June, as platform purchase very Based Saguaro. management Los Angeles, Soho into Line of Saguaro In membership Austin, The of a be The the Scottsdale bedrooms. Home. We hotel of to related Hotels. in and over entered Springs. completed excited in our and hotels

broaden our to not it this will about also experience We will members continue excited on platform. are the reach, acquisition, for our our very it only geographical enhance

who over our take performance. I'll now through pass will you to financial Humera,

highlights take quarter now I'll the financial second Andrew. the XXXX. of Thanks, for you through

Soho driven new our of total quarter, across MCG increased In this of million the total the represented well resilience XXXX. members of Firstly, House quarter revenue. compared second was retention members the by rate the addition membership existing million revenue the as our as And XX% $XXX of brands. in revenue of with $XX of the

Andrew XX As decision the already limit strategic has Soho made last House to mentioned, in the membership months. we intakes

brands, in new increase the versus House second However, and the membership quarter Works Soho Friends, was by XXXX the members fall in Home+. offset including of

across to The of Soho unfreeze XXXX. quarter quarter. the million the addition ongoing in strongly, increase members driven the increasing reopening and In-house the gradual of In restrictions versus revenue was throughout regions. our $X our second of to distancing houses all of million House removing by rebounded $XX social the in

to Other XX% for think restaurants America June, by quarter, below. easing rates showed a XX% much strong if with $X QX public lagging with the levels at U.K. restrictions. in North about note the was to in still June at we XX% XXXX. In line quarter quarter. important in delivered of outdoor revenues million demand North seating is million around and of as out as U.K. additional below end the that our $XX the sites XX% strong local below regulations recovery Although, sites in our market XXXX, it by we the exit results impacted the reopened Overall, these the the well of local versus consumer trading around were driven areas. pent-up also And still and America of in comparative Europe at at of

our a public in revenues. Miami, boosted we remaining Mandolin, further XX% restaurant Additionally, the which the of other share acquired

also year-on-year. by Home another growing delivered quarter, strong XXX% Soho revenues

growth includes XXXX. cost benefit fees improved reopening the property resulted management the Finally, Scorpios program, versus the cost operating We savings our in period in ratios from comparative at well significantly the the as reopened. good as in also which revenue progress our Ned houses other London the as from of made

procurement combined consolidation. improvement waste our June contributed ratio is opportunities at beverage comparative improvements savings to opportunity period program in food the in contract another X% of have continues deliver management. our to in savings new in we there through significant cost continues the X% this, site we North the only we believe also level, vendor procurement cost global a ratio program and the and to in improvement purchasing started. At versus sales of savings And American stock Our delivered sales with in renegotiation pre-COVID in where just market XXXX. June identify and And

valued last the months, we the attract as employees, hourly hospitality wage we you're ensuring rates. wages we has and our increased quarter I'm few not competitive pay continue help our to sure employees increasing aware, the immune. well seen To as pressures were inflationary As industry in retain the in new that most

However, we hours level. at site manage the able through rotor pressures to and management the inflationary careful were

recognizing we as reopened the tightly We that office also support controlled need of costs and in costs. closely to control we uncertainty operate the the environment

the Scorpios to $XX compared business $XX of year include add revenues House, remained well was in the of by as house European London, new and contribution, that XXXX. This versus for Home of opening of period. quarter we restaurants non-house costs that G&A of our profitability than noncash opening House the our expenses that the million opening Moving which well primarily million is these that new our of houses we business. plus million. It's in meaning to important was our the rental in Soho of was as our growth are the in the lower year-on-year revenue XXX items expenses $XX associated level improvement QX. Other XX%, we houses closed comparative preopening the report on a period partial both reopened to actual operational totaled driven revenues. we well expenses a back in the and the difference with XXXX open XXXX, public GAAP preopening membership in which the preopening House opening Soho million for which as burdened $X loss to in measures. increase other loss which with loss lower as include expenses before recovery Austin and in are May a that with of expenses fully These between membership our to related Other as comparative $X when the as contribution as represent operating margin prior also growth, the the predominantly other house, which EBITDA associated items second rents, due reported expenses million we costs a accordance cost. incur less due as fully we rehighlight in define by was we to adjusted quarter, they $X factors the in the cash including million quarter EBITDA, here was of as the impacted and growth of Adjusted and

million rent For the rent noncash performance second management slide We for the fees provided transaction, $X purposes, credit well the we of on of from represents with add proceeds. support has Hong our balance IPO initiatives. back the In assess the a proceeds our received net table to capitalization which significantly a to totaled funding rental adjusted restructure our us shows noncash $XXX costs with cost. and Noncash actual growth our lease. The strengthened houses. as as rent cash recent development of in between the due the to accordance the million quarter, difference GAAP of Kong sheet

environment in notes our decided million. in liquidity instead Given and access have to and we and RCF preserve the funding, secured our uncertainty to totaling facility order off paid senior the preserve $XX to current

As an the our outlook. Paris. I'll million. in addition Austin House, digital update revenue in-house back platform, preference quarter capital shares repaid House related Cash of and to House, as as capital the expenditure on usage extension to Soho now totaling as previously reduced to Farmhouse Foundation on disclosed, have Soho to $XX our of well well also the in levels we contributions related hand Nick second Soho for as

Thanks, Humera.

at We've Inclusivity ESG from houses. to have just teams XX have to and central Board members have It is already first quarter, who work out starting have set received on to we a In Soho diversity energy individuals starting XXXX reduction many program been these by within launch XX% brilliant initiatives. Chance, who an support increase what the world we last applications our deeply ideas. our help our and onboarding. I've representation the supplier of over day. particularly again been DNA annual which introduced around the We House reach do business, group growing formed with sustainability our is their progress to the which anyone we targets excited and care our or innovative is to our which into Foundations, every for made of in training XXX program goal strong about core of a truly

and other in Our members people to love helping their them succeed passions. opportunity achieving giving an

with as mentorship creative far people in to marginalized we from from continues careers program, cities, reopened understandably, which the we the members of strength backgrounds have our members, so and seen pairs from the recovery term, business. In COVID in as Our in a me young gives L.A. well and as strength, pursuing go of have pent-up new Soho uncertainty create including demand Chicago. cases the The the is industries associated on launching recovery to near great this confidence some and profile conditional does our restrictions. timing exact of rise

some U.K. of that have in U.K. are Europe the We houses to confidence our are international follow of where members too the is compared call in will capacity recovery. our America momentum impacted its the and restrictions turn, impact we the global shape seen from clearly, by But preventing and but seeing have to travel time it's the mandates, vaccine and mask recovery early stronger visiting. North from

Soho Longer Brighton membership Soho well number House open ambitions pipeline expect the applications Our to and in of also XXXX and future in the high and term, remain track, quarter Houses X unchanged. of XXXX. The us growth. fourth our strong we for development third the positions on new quarter waitlist remains

ahead. to and to year. all margin. And between for X the houses by a grow listed XX% excited been a the EBITDA grow looking by the we're attractive to XX% as our are of last finish quarters have and a EBITDA we each and It's We X very achieve XX% quarter XX% very to members, all and year, a future. I'd to a we investors We model thanking in strong per membership aim to finally, start our to revenue for year. open in and financial their team our adjusted to aim plan like life support company, at

first The of line the Instructions] [Operator comes Zaccone question from Citigroup. Steven with

margin year, summer the you of the trajectory recovery. second thinking bit alluded a presumably, bit but I just walk quarter? should wanted revenue third revenues? had far that shape focus I cited the the you okay, does how are about rate of little to a guess -- because June, of on of And to some you half the exit I different more performance how then look your metrics in more you the on for house a expectations a through could be membership of thus

add a with U.K. XXXX We're recovery. our that we're very it's exceeding here. and Humera now. to strong will then and start England, here figures Steven, Andrew numbers Nick I'll it. We're seeing seeing in and

of restrictions houses because soccer There's -- been restaurants. XX% Delta U.K., can here. There variant the we've is to our People the people no Our go in to the no with matches, mask living U.K. and matches. business. sports mandate are can go

So seeing very strong very, we're growth.

to members back aiming lot are They coming from office working fall. love a more be houses. are the from the in September to Our people aiming the

U.K. is in in as shape far local members. So the pretty shape. Europe good good as is the

to many that relies travel that are but cities. local using the they members, so use gives local into it because bit about that thing House globally. to buffer able on that means more the it's is of fact great our members is sort get also its houses that particular the aren't people fact the not locally Soho rooms think the a difficult It and and I fact of necessarily hotel the a the

Rome But phenomenal know all that a ago, the we months membership programs but in Europe America, got also very Coast, the and that much Paris again, Miami back So not of say, busy, good. Kong. is couple but all are Florida. front the restrictions people signs. And are it's had North open. what's figures encouraging say has of West opening York New Mumbai are to in been is is XXXX And also signs it Europe to Hong strength vaccine is I in and well up. it They're open. back It's house going a than encouraging India position the a nor was, in really and in of in is better and in where quite gone happening We nearly the because see very encouraging. And

I'd add Humera, to you like can So to -- that.

The continuing only as add what I'd Yes. membership, in to seeing are the thing is expectations of we're members that in fact, to unfreeze terms outpacing our what original membership were. unfreezing is

are be our and America. of to and towards effective, that we'll effective. And So our our But towards and North cost should management also levers in tools to management variant see terms labor in in programs that. specifically cash up to levers are we that control to some terms shift and have there's to would there more the in that procurement continue of continue those I think continue be we tight of performance, through Delta in continue work list call --

Yes.

bit a add more on I'd membership. So little

waitlist. I think new that intakes. resume high in Also Nick excited those growth levels remarks, We've in in existing pre-COVID So half, and membership our on we're it's both are second mentioned houses membership the new in and got houses, our types that as his we accelerating of opening about. super super confident

recurring. a into have level is of the predictability coming of half X. the XX% and we And it's our So high membership revenue

about being the to strong really our feel we back think members I So houses.

last just membership, workspaces, remarkable incredibly introduced we Andrew, It's using who our and amount who of go of have to also, is it And And applications end applications really in for going Europe. North houses, that. we America in our healthy a staying well. year, every of the people we've at who in We're the Friends only this like bedrooms, for And but access read. space. which who seeing like studio our launched our amount can't that week into Soho

question, the I well is waiting answer very poised. Steven? those to and think we're Does for restrictions I So your go last think away, world just

in luck of the Best half. Yes. back

The from of next comes Morgan Thomas Allen question the Stanley. with line

that So think Soho the just It I a stood very bit? did the sounds from historically, But about townhouses. out. well. of revenue you other Can half on strength business really elaborate restaurants and Home like just that came little

So color us just can on a little give bit there? more you

Yes.

other comeback. in revenue, We're yes, a very of certainly seeing. So terms very, strong

of So in breakdown take specifically we North regional XX% interest the America, an in. it restaurant if already , we I down, additional had acquired region, by which

been better than United expect that And was far this has in we dining. in to restaurants capacity outdoor of having saw So we public a quarter. In is much part expected. U.K., the Kingdom, future that actually additional we

then, we much about Home And Siemens to I'll in where pass And the that's in better also our the outpace have quarter. a little restrictions talk place the this also back we also typically so be for will that to are. And course, were our how Europe. performed business, then of so around opened performed across of Andrew that expectations Europe, this time more despite that which year, and bit that

Humera. Thanks, sure. Yes,

members bring is the to So about our allowing our Home. House, all Soho Home business

XX% I members, I as sales of Soho our where a membership from think our business. mentioned, is Home

go next we're sales. Soho will to business confident rapidly members, level Home+ exciting. our high sales the have We've membership. years. X nicely. That's very actually which growing And is all We that built it's ahead that business will profits and in very really of trajectory continue And of that our confident half our quite over unique. X we're very in And X growing super it's got around our a

Nick, to add on you we'll anything? do each it continue want talk about So quarter. to

about not know Well, fantastic is I view, creative in as autumn -- from full. collection autumn is a cool point seen ever and we've of but creativeness, your that your

. connect. Full

come is that sell But future. is has we since And Thomas. have the a in X years, questions? fantastic. -- home Thank Home And onboard our ambitions in Andrew the last you, answer it to really just Does huge I your business really rocketing.

Midtown. there follow-up, up going at Rome, Ned my you were announced bit? X And you as apartments. you there? to were Studios, the Soho on to opening Is that opening I thought what can MCG? York? long-stay in Home incremental just the I thing, the elaborate then new. still Are heard And up happened does. and It just another then One you Ned that you're new those a that Second and And Nomad little open in up New things

long in the I'll the will apartments local route little of area in house in But lots about next There's always couple because then talk who film Mayfair. a and chose is here people it's first stay. They're one. very They're stay, a well. industry. those doing stay studios. incredibly take to last yes, We Andrew long It's have There's apartment Rome big got full. film -- long area. want the we're that of we

why and beautiful, So that's they will we that. I are really created sell And think incredibly they well.

-- really the in the We've very, encouraging membership in types Friends. XX,XXX it floor a far customers that enhanced membership are different as very on just return is moving and as a of London piece floor hotel. Ned a here is the And we've it Ned, week before As it's have Ned I introduced about as -- and hotel. super for was occupancy ground XXX-bedroom lockdown The we because encouraging the we came. is the on I'm the talk the offering well. because lockdown, the introduced But let And the to Ned, large big mean, then -- the me exciting footfall Ned. doing Ned we've ground

membership the is and the So right Ned to expand hotel. the

be going loved came of in going New to it's things beautiful transferred lot the Nomad. Ned. the with over and membership opportunity that the our we're lovely Nomad before, to the a York, It's a a keep really but including it. We're to be within to So building about people going

Studios. add you to the amount where building, super experience that. And huge in and a low and bedrooms, Andrew, stock is building, Home be of construction the exchange of the want got and it old at F&B under right, exciting we going it's but other and are So building, opportunities. on signed, it's of maybe the then membership moment, to about is you're Amex

Nick. sure, Yes,

with we gallery a big have launched for our members So business would design showcase create a which allow Studios, members members, our was to service, space been business, a has Ned our our have it's retail incredibly also a so members. style is that their But but we our product. Home recently space felt to from interior own a available to opportunity there actually popular digital-first to for only and our

they're going going be coming enhancing the months super and just of unique all way the London members. them, and to our District. for got also in membership. couple events, New have our we've So around to And it's in next We're unique another based spaces, and York Meatpacking of unique spaces

on doing. whatever retail whole often And because there great they're in opportunity opportunities out less as soon of thing are many now and as because buy, whatever community go is. is where there excited is community they And and then go pushing commerce so the buy, they the about super there, because

pleased that Thomas? we're about answer, So Does that.

Yes, that's great.

question the of with comes line next Sachs. Your Stephen from Goldman Grambling

the strategy, in your about thoughts in-house your I -- on to inflation? seeing you labor guess, relates to it as you're love both membership. the as what pricing given think terms I'd of of latest And kind hear

going then capability our to of we've means going to always been is there raising prices. that pass Humera. I'm price, start, which always and to Pricing, I'm Stephen, reasonable

not their go labor ball far to market the because saying delivering not Our be concerned, sensitive around is changing But because cost reopened up I'm COVID members necessarily SMB challenge we as when always They're of was expect their smart of to know, see -- They and certainly in but labor and we crystal very we in up. a of are the U.K. -- going are But have but [ responsible costs we not on staffing about because realized here. room how very as going Brexit. that thinking that. And careers, super we of their goods understand we're prices a people the prices. and they everywhere. they are going ] increases

and it I looked America. And And and in what are everyone's contracts, always on people about retraining directly to use very how we who and subcontracts our with People and to recruitment -- were we at the on And they And we've same go centers rates, source, have recruiting. we've people do. past, the staffing, all are we've the be Italy in different now we on passionate the best-in-town hard of now. looking -- ways before work have In new done our pandemic would are Portugal. we good think at we'd people. exactly and France hourly so are with reviewed we massively dealing all we we're going that

come airlines, from really to people people retraining into them so So encouraging and business. Humera? the we're retail, from

Yes.

Just to color to that. add some to

cleaning managing we the freight, XXX in as that, rates We've think hourly we're in increase we In increased look between continue would reduction inflationary seeing are strategy. I and hourly significant $X inflation. and areas so terms hourly other we to in your and we a other increased $X. past the rate prices such did rates, without and increase to laundry GBP also pricing yes, And contract in and in have to believe U.S. a volume how future seeing the we we having pressure We're power. also between that rate of still retail point, seen

to an And question. perhaps maybe other one earlier follow-up

or relates one the of On out either [indiscernible] the we outlook, year, it of recent as or the half time be second in should there a up other expenses just coming any that thinking back through restrictions? ramping is even the

coming see currently barring can't I a forecast there be that. and may anything we advisory us. that costs IPO to that's shops through, to but are one-off that be that None some still related the

our margins we XXXX, that smarter we on through Stephen, on the make improvements and see ahead. the more there was of we're opportunity, months years efficient. continue to and and lot see we'll low-hanging and that, a fruit, in really during all looking that compared were pandemic, coming And seeing business to to was And us beginning in when are our there and and good how to was

follow-up And typically very, the in-house have you mean, seen maybe as look in-house on several less revenues I I you've typically, very guess, in-house that. over if quick that years strong past one think you these I loss expenses up less strong actually that of all fee. Are make of kind given expensive these revenues turn you a some revenue in you at of and how with in-house the running the seeing profitable locations, membership the are? trends.

question. it's Yes, follow-up a good

we've the restructuring, So teams set through that base. and -- we on the both made, improvement improving we've margins margins, level a and half significant streamlining supply cost are F&B changes at

our to is describing breakeven is long-term our as you're that from made actually move midterm -- we membership is So revenue goal what because ultimately, loss a goal EBITDA. our

anything want of Nick we're So as a making on said, you it's -- And really ours. add it. that, Humera? And good progress making focus we're to huge if on

to we Yes, already the as better that. of of talked sales work beverage through. on pressure look, about we Wages, We'll some management inflationary improvements charge really talked those coming seeing whilst X% of to We we're on food in and see initiatives team cost use about technology, sales our think on wages, well. continue better ratio, scheduling, of X% ratio. cost the improvement improvement we'll

there a well. save So think as I more is to

Shaun of line of with Bank America. the from comes Kelley question Next

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to not there's demand. People much been many do, places haven't go. to a think I pent-up had

alluding seeing and the and this, are to average we we seeing occupancy at we also occupancy is Farmhouse have actually uptick I -- so spend. Nick, houses, at rates, if get Babington high can't frankly. XX% myself, it look so slight rate and a We're exponential And Miami, in our so and

only go slightly mean people the So it offices. I are thing continuing coming it's split. are is because think into XX back And lagging still the I sort back we'll But high. be a in to as not I'd of to houses that see consistently people add other XXX% back

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Loop with comes the question of Markets. Adam from Capital next The Daniel line

Congratulations.

Just one for or you that memberships your quarter? XXX me. do It looks to reason gradual ahead, Texas cities was like houses? decline declined without that [indiscernible] grow in members Just looking expect of opening open in what sequentially, for Austin, the related -- then do the should decline houses about I to expect by guess And the [indiscernible] you partial membership

question. Great Daniel.

So yes, correct. are you

we house range in city membership. and for we that So a have when city, example, CXB house membership into transfer when open, houses those the Austin, Paris

that's So done. that we've something always

and physical We it Africa huge plans CWH into Asia. wonderful next like our us. regions actually Latin for because find have for newer It it's got us membership a helps expands locations, America, our ambitious

XX we'll we'll early be by year, actually XX expand in And next cities. this cities. So to year,

physically. also inclusivity by So grow actually, the we both are it's and diversity of be proven adds us successful. and expanding our to so membership. because CWH to It It helps membership

on So CWH, there's actually and it's a lot incredibly more to exciting. come

with Next Sharon the question comes Zackfia line William of Blair. from

is everyone hope doing well. I

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add to and me Humera want take Andrew that, and I'm to Sharon. Let that, might sure

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is there capacity. So

think color more Sharon, excited that I Nick. incredibly a bit on would We're about houses. for new add I just little our

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do Nick, else to So add want anything you that? to

good. I'm No.

question, Great. Did your I answer Sharon.

that's Yes, perfect.

JPMorgan. comes line with Joe from the of question Greff Next

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Nick to like back hand to I And there no further would comments. closing online. are for questions Jones registered

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forward of these restrictions disappear, you. members the yes, time. Thank our -- So big look in calls return future I to many as more and

Thank you.

Thank you.

and concludes today's this for call. conference a you and have Ladies pleasant gentlemen, joining, very day. Thank Goodbye. much