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Membership Collective Group Inc. (“MCG”), (NYSE: MCG) today reported results for its third quarter ending October 3, 2021.
Strong growth across the MCG platform; Houses returning to pre-pandemic levels
Total members increased by 16,663 in the quarter to 144,503, driven by continued high retention of members, the resumption of intakes at existing Houses, new Soho House openings and the continued growth across our membership platform.
Total Revenue increased 57% from the third quarter 2020 to $180m driven by the rebound of In-House Revenue, which increased 122% in the three-month period-on-period, rising to pre-pandemic levels through the quarter.
Membership Revenue grew by 21% to $51m, accounting for 28.5% of Total Revenue.
Soho House Member Retention rates remained high at 94% on a rolling twelve-month basis.
MCG Waitlist continued to increase to 66,800 to support future growth. Number of applications added to waitlist exceeded new member intakes.
International expansion across new countries with two new Soho House openings in Paris and Tel Aviv in the quarter and Soho House Rome opening in early October, taking the total number of House openings to six in 2021.
Net loss of $76m and Adjusted EBITDA1 of $9m up $5m from the third quarter 2020.
Nick Jones, CEO of Membership Collective Group, commented:
“We’ve had a really strong quarter and have loved welcoming members back to Soho Houses around the world, to Scorpios Beach Club in Mykonos and The Ned in London.
After a summer packed with live music and events at the Houses, our spaces are lively and buzzing once again as members enjoy reconnecting and spending time together. With international travel continuing to open up, I - along with our members - have enjoyed visiting our newer Houses that have opened in Austin, Tel Aviv, Paris and most recently, Rome.
Financial Summary for the Third Quarter 2021:
Total Revenue increased 57% from the third quarter 2020 to $180m.
Membership Revenue was $51m, an increase of 21% versus the third quarter 2020 largely due to a Soho House Member Retention rate of 94% on a rolling twelve-month basis and the addition of new members.
In-House Revenue increased 122% versus the third quarter 2020 to $67m, driven by the strong demand from our members returning to the Houses, as well as the relaxation of Covid-19 restrictions.
Other Revenue was $62m, a 48% increase from the third quarter 2020 driven by strength of Soho Home and our public restaurants as well as the impact from the Line and Saguaro hotels.
Membership credits with a sales value of $21m, recorded in the prior period as a liability, were redeemed in this quarter and accordingly were not captured within Total Revenues. Credits for the vast majority of our Houses expired at the end of the third quarter of 2021.
Operating loss of $(53)m compared to $(16)m in the same three-month period last year, largely due to the impact of non-cash share-based payments, foreign exchange and costs associated with the IPO.
House-Level Contribution2 was $24m, or 21% of total House Revenue in the third quarter 2021. The decrease in House-Level contribution versus the same three-month period last year is primarily due to a one-off credit of $10.5m we benefited from in the third quarter of 2020 related to Covid-19 lease amendments. Excluding this credit, House-Level contribution would have increased by $8m in the three-month period-on-period.
Net loss attributable to Membership Collective Group Inc. was $77m, versus $37m in the third quarter 2020 due to the impact of share-based payments, foreign exchange and costs associated with the IPO.
Adjusted EBITDA2 was $9m or 5% of revenue, compared to $4m in the same period last year, driven by reduced Covid-19 restrictions compared with 2020.