Acquisitions and Dispositions |
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| Business Combination, Asset Acquisition, Transaction between Entities under Common Control, and Joint Venture Formation [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Acquisitions and Dispositions | Acquisitions and Dispositions Sale of Bombshells Austin On November 14, 2024, the Company sold Bombshells Austin for $70,000 in cash and $60,000 in a 6% 12-month promissory note. The Company recognized a $1.3 million gain on the sale. Flight Club On January 21, 2025, the Company completed the acquisition of a club in the Detroit, Michigan, market for a total agreed acquisition price of $11.0 million, consisting of $3.0 million in cash and $5.0 million in a seller-financed 8.0% promissory note (see Note 6) for the club, and $3.0 million in cash for the associated real estate. 13. Acquisitions and Dispositions—continued The preliminary fair value of the consideration is as follows (in thousands):
We recognized the assets and liabilities for this acquisition based on our estimates of their acquisition date fair values in our Nightclubs reportable segment. We have not finalized our valuation of the tangible and identifiable intangible assets acquired in this transaction. As of the release of this report, the fair value of the acquired tangible and identifiable intangible assets are provisional pending the completion of the final valuations for those assets. Based on the allocation of the preliminary fair value of the acquisition price and subject to any working capital adjustments, the amount of goodwill is estimated at $613,000. Goodwill represents the excess of the acquisition price fair value over the fair values of the tangible and identifiable intangible assets acquired, which is essentially the forward earnings potential of the acquired club and our entry into a new market. Goodwill will not be amortized but will be tested at least annually for impairment. Approximately $613,000 of the recognized goodwill will be deductible for income tax purposes. The following is our preliminary allocation of the fair value of the acquisition price (in thousands) as of January 21, 2025:
Licenses and tradename will not be amortized but will be tested at least annually for impairment. In connection with this acquisition, we incurred approximately $0 and $141,000 in acquisition-related expenses during the three and nine months ended June 30, 2025, respectively, which are included in selling, general and administrative expenses in our unaudited condensed consolidated statements of income. From the date of acquisition until June 30, 2025, the acquired club contributed the following, which are included in our unaudited condensed consolidated statements of income (in thousands):
We have not yet received the fiscal 2024 financial statements from the seller, therefore, we could not provide supplemental pro forma information for the combined entities. Sale of Aurora CO Property On March 31, 2025, the Company sold a real estate property in Aurora, Colorado, for $825,000. The Company recognized a loss of $153,000 on the sale, net of closing costs. 13. Acquisitions and Dispositions—continued Platinum West and Platinum Plus On April 7, 2025, the Company completed the acquisition of a club in West Columbia, South Carolina, for a total purchase price of $8.0 million, consisting of $3.75 million cash and $2.5 million in a seller-financed 7% promissory note (see Note 6) for the club, and $1.75 million cash for the associated real estate. On June 13, 2025, the Company completed the acquisition of a club in Allentown, Pennsylvania, for a total purchase price of $2.0 million, consisting of $1.5 million cash and $500,000 in seller-financed 7% promissory note (see Note 6). The Allentown club transaction was completed several weeks after the West Columbia club due to delays in the issuance of licenses. As of the filing of this report, we have not completed our valuation and do not have estimates of fair value for the acquired assets and any assumed liability, if any. In connection with this combined acquisition, we incurred approximately $52,000 and $103,000 in acquisition-related expenses during the three and nine months ended June 30, 2025, respectively, which are included in selling, general and administrative expenses in our unaudited condensed consolidated statements of income. From the date of acquisition until June 30, 2025, the acquired clubs contributed the following, which are included in our unaudited condensed consolidated statements of income (in thousands):
We have not yet received the fiscal 2024 financial statements from the seller, therefore, we could not provide supplemental pro forma information for the combined entities.
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