Condensed Consolidating Schedules (Tables)

6 Months Ended

Jul. 02, 2017

Condensed Financial Information of Parent Company Only Disclosure [Abstract]

Condensed Consolidating Balance Sheet

CEC Entertainment, Inc.
Condensed Consolidating Balance Sheet
As of July 2, 2017
(in thousands)
	Issuer			Guarantors		Non-Guarantors			Eliminations			Consolidated
Current assets:
Cash and cash equivalents	$	77,470		$	5,334	$	6,658		$	—		$	89,462
Restricted cash	—			—		115			—			115
Accounts receivable	13,864			2,257		4,082			(3,418		)	16,785
Inventories	20,887			3,542		279			—			24,708
Prepaid expenses	13,056			7,529		1,149			—			21,734
Total current assets	125,277			18,662		12,283			(3,418		)	152,804
Property and equipment, net	521,750			57,705		6,588			—			586,043
Goodwill	433,024			51,414		—			—			484,438
Intangible assets, net	17,922			464,270		—			—			482,192
Intercompany	101,632			—		—			(101,632		)	—
Investment in subsidiaries	475,669			—		—			(475,669		)	—
Other noncurrent assets	8,112			13,295		296			—			21,703
Total assets	$	1,683,386		$	605,346	$	19,167		$	(580,719	)	$	1,727,180
Current liabilities:
Bank indebtedness and other long-term debt, current portion	$	7,600		$	—	$	—		$	—		$	7,600
Capital lease obligations, current portion	539			—		10			—			549
Accounts payable and accrued expenses	96,018			3,594		3,750			—			103,362
Other current liabilities	4,048			511		—			—			4,559
Total current liabilities	108,205			4,105		3,760			—			116,070
Capital lease obligations, less current portion	13,249			—		55			—			13,304
Bank indebtedness and other long-term debt, net of deferred financing costs, less current portion	966,739			—		—			—			966,739
Deferred tax liability	160,581			24,241		(2,241		)	—			182,581
Intercompany	—			79,026		26,024			(105,050		)	—
Other noncurrent liabilities	214,986			13,497		377			—			228,860
Total liabilities	1,463,760			120,869		27,975			(105,050		)	1,507,554
Stockholder's equity:
Common stock	—			—		—			—			—
Capital in excess of par value	358,956			466,114		3,241			(469,355		)	358,956
Retained earnings (deficit)	(136,973		)	18,363		(9,692		)	(8,671		)	(136,973		)
Accumulated other comprehensive income (loss)	(2,357		)	—		(2,357		)	2,357			(2,357		)
Total stockholder's equity	219,626			484,477		(8,808		)	(475,669		)	219,626
Total liabilities and stockholder's equity	$	1,683,386		$	605,346	$	19,167		$	(580,719	)	$	1,727,180

CEC Entertainment, Inc.
Condensed Consolidating Balance Sheet
As of January 1, 2017
(in thousands)
	Issuer			Guarantors			Non-Guarantors			Eliminations			Consolidated
Current assets:
Cash and cash equivalents	$	53,088		$	1,158		$	6,777		$	—		$	61,023
Restricted cash	—			—			268			—			268
Accounts receivable	16,922			3,220			2,455			(2,102		)	20,495
Inventories	18,255			3,151			271			—			21,677
Prepaid expenses	14,294			6,077			1,127			—			21,498
Total current assets	102,559			13,606			10,898			(2,102		)	124,961
Property and equipment, net	538,195			47,906			6,785			—			592,886
Goodwill	432,462			51,414			—			—			483,876
Intangible assets, net	19,157			464,926			—			—			484,083
Intercompany	127,107			317			—			(127,424		)	—
Investment in subsidiaries	436,483			—			—			(436,483		)	—
Other noncurrent assets	6,888			17,025			393			—			24,306
Total assets	$	1,662,851		$	595,194		$	18,076		$	(566,009	)	$	1,710,112
Current liabilities:
Bank indebtedness and other long-term debt, current portion	$	7,600		$	13		$	—		$	—		$	7,613
Capital lease obligations, current portion	460			—			7			—			467
Accounts payable and accrued expenses	84,207			11,445			2,184			—			97,836
Other current liabilities	3,764			511			—			—			4,275
Total current liabilities	96,031			11,969			2,191			—			110,191
Capital lease obligations, less current portion	13,542			—			60			—			13,602
Bank indebtedness and other long-term debt, net of deferred financing costs, less current portion	968,266			—			—			—			968,266
Deferred tax liability	166,064			21,234			(1,008		)	—			186,290
Intercompany	—			106,131			23,395			(129,526		)	—
Other noncurrent liabilities	212,943			12,484			331			—			225,758
Total liabilities	1,456,846			151,818			24,969			(129,526		)	1,504,107
Stockholder's equity:
Common stock	—			—			—			—			—
Capital in excess of par value	357,166			466,114			3,241			(469,355		)	357,166
Retained earnings (deficit)	(148,265		)	(22,738		)	(7,238		)	29,976			(148,265		)
Accumulated other comprehensive income (loss)	(2,896		)	—			(2,896		)	2,896			(2,896		)
Total stockholder's equity	206,005			443,376			(6,893		)	(436,483		)	206,005
Total liabilities and stockholder's equity	$	1,662,851		$	595,194		$	18,076		$	(566,009	)	$	1,710,112

Condensed Consolidating Income Statement

CEC Entertainment, Inc.
Consolidating Statement of Comprehensive Income (Loss)
For the Three Months Ended July 2, 2017
(in thousands)
	Issuer			Guarantors			Non-Guarantors			Eliminations			Consolidated
Revenues:
Food and beverage sales	$	82,807		$	13,324		$	1,280		$	—		$	97,411
Entertainment and merchandise sales	88,857			18,811			2,056			—			109,724
Total company venue sales	171,664			32,135			3,336			—			207,135
Franchise fees and royalties	463			4,186			—			—			4,649
International Association assessments and other fees	375			10,544			8,098			(19,017		)	—
Total revenues	172,502			46,865			11,434			(19,017		)	211,784
Operating Costs and Expenses:
Company venue operating costs:
Cost of food and beverage	18,936			3,464			423			—			22,823
Cost of entertainment and merchandise	6,329			389			136			—			6,854
Total cost of food, beverage, entertainment and merchandise	25,265			3,853			559			—			29,677
Labor expenses	54,654			4,541			1,156			—			60,351
Depreciation and amortization	24,394			962			435			—			25,791
Rent expense	21,825			1,552			529			—			23,906
Other venue operating expenses	42,664			3,259			990			(10,946		)	35,967
Total company venue operating costs	168,802			14,167			3,669			(10,946		)	175,692
Advertising expense	8,315			1,413			10,580			(8,071		)	12,237
General and administrative expenses	4,726			10,707			118			—			15,551
Transaction, severance and related litigation costs	490			—			—			—			490
Total operating costs and expenses	182,333			26,287			14,367			(19,017		)	203,970
Operating income (loss)	(9,831		)	20,578			(2,933		)	—			7,814
Equity in earnings (loss) in affiliates	27,993			—			—			(27,993		)	—
Interest expense	15,921			975			165			—			17,061
Income (loss) before income taxes	2,241			19,603			(3,098		)	(27,993		)	(9,247		)
Income tax expense (benefit)	8,171			(10,515		)	(973		)	—			(3,317		)
Net income (loss)	$	(5,930	)	$	30,118		$	(2,125	)	$	(27,993	)	$	(5,930	)
Components of other comprehensive income (loss), net of tax:
Foreign currency translation adjustments	420			—			420			(420		)	420
Comprehensive income (loss)	$	(5,510	)	$	30,118		$	(1,705	)	$	(28,413	)	$	(5,510	)

CEC Entertainment, Inc.
Consolidating Statement of Comprehensive Income (Loss)
For the Three Months Ended July 3, 2016
(in thousands)
	Issuer			Guarantors			Non-Guarantors			Eliminations			Consolidated
Revenues:
Food and beverage sales	$	84,011		$	12,099		$	1,294		$	—		$	97,404
Entertainment and merchandise sales	106,678			5,850			2,129			—			114,657
Total company venue sales	190,689			17,949			3,423			—			212,061
Franchise fees and royalties	672			3,888			—			—			4,560
International Association assessments and other fees	207			615			8,357			(9,179		)	—
Total revenues	191,568			22,452			11,780			(9,179		)	216,621
Operating Costs and Expenses:
Company venue operating costs:
Cost of food and beverage	21,014			3,140			519			—			24,673
Cost of entertainment and merchandise	7,639			457			144			—			8,240
Total cost of food, beverage, entertainment and merchandise	28,653			3,597			663			—			32,913
Labor expenses	55,375			3,803			1,227			—			60,405
Depreciation and amortization	28,596			628			509			—			29,733
Rent expense	22,110			1,379			560			—			24,049
Other venue operating expenses	34,876			2,369			979			(848		)	37,376
Total company venue operating costs	169,610			11,776			3,938			(848		)	184,476
Advertising expense	8,801			1,048			10,644			(8,331		)	12,162
General and administrative expenses	5,746			10,067			109			—			15,922
Transaction, severance and related litigation costs	427			7			—			—			434
Total operating costs and expenses	184,584			22,898			14,691			(9,179		)	212,994
Operating income (loss)	6,984			(446		)	(2,911		)	—			3,627
Equity in earnings (loss) in affiliates	(4,683		)	—			—			4,683			—
Interest expense	15,479			1,536			106			—			17,121
Income (loss) before income taxes	(13,178		)	(1,982		)	(3,017		)	4,683			(13,494		)
Income tax expense (benefit)	(4,126		)	585			(901		)	—			(4,442		)
Net income (loss)	$	(9,052	)	$	(2,567	)	$	(2,116	)	$	4,683		$	(9,052	)
Components of other comprehensive income (loss), net of tax:
Foreign currency translation adjustments	161			—			161			(161		)	161
Comprehensive income (loss)	$	(8,891	)	$	(2,567	)	$	(1,955	)	$	4,522		$	(8,891	)

CEC Entertainment, Inc.
Consolidating Statement of Comprehensive Income (Loss)
For the Six Months Ended July 2, 2017
(in thousands)
	Issuer		Guarantors			Non-Guarantors			Eliminations			Consolidated
Revenues:
Food and beverage sales	$	190,998	$	27,725		$	3,107		$	—		$	221,830
Entertainment and merchandise sales	207,645		32,923			5,073			—			245,641
Total company venue sales	398,643		60,648			8,180			—			467,471
Franchise fees and royalties	904		8,368			—			—			9,272
International Association assessments and other fees	689		21,088			18,607			(40,384		)	—
Total revenues	400,236		90,104			26,787			(40,384		)	476,743
Operating Costs and Expenses:
Company venue operating costs:
Cost of food and beverage	42,931		7,152			957			—			51,040
Cost of entertainment and merchandise	14,230		804			307			—			15,341
Total cost of food, beverage, entertainment and merchandise	57,161		7,956			1,264			—			66,381
Labor expenses	114,837		9,379			2,522			—			126,738
Depreciation and amortization	49,374		1,882			947			—			52,203
Rent expense	43,104		3,053			1,068			—			47,225
Other venue operating expenses	85,680		6,545			2,295			(21,804		)	72,716
Total company venue operating costs	350,156		28,815			8,096			(21,804		)	365,263
Advertising expense	19,252		3,259			21,688			(18,580		)	25,619
General and administrative expenses	10,807		21,741			267			—			32,815
Transaction, severance and related litigation costs	570		—			—			—			570
Total operating costs and expenses	380,785		53,815			30,051			(40,384		)	424,267
Operating income (loss)	19,451		36,289			(3,264		)	—			52,476
Equity in earnings (loss) in affiliates	38,647		—			—			(38,647		)	—
Interest expense (income)	31,828		1,992			303			—			34,123
Income (loss) before income taxes	26,270		34,297			(3,567		)	(38,647		)	18,353
Income tax expense (benefit)	14,978		(6,803		)	(1,114		)	—			7,061
Net income (loss)	$	11,292	$	41,100		$	(2,453	)	$	(38,647	)	$	11,292
Components of other comprehensive income (loss), net of tax:
Foreign currency translation adjustments	539		—			539			(539		)	539
Comprehensive income (loss)	$	11,831	$	41,100		$	(1,914	)	$	(39,186	)	$	11,831

CEC Entertainment, Inc.
Consolidating Statement of Comprehensive Income (Loss)
For the Six Months Ended July 3, 2016
(in thousands)
	Issuer			Guarantors			Non-Guarantors			Eliminations			Consolidated
Revenues:
Food and beverage sales	$	191,834		$	24,888		$	2,885		$	—		$	219,607
Entertainment and merchandise sales	245,886			11,448			4,880			—			262,214
Total company venue sales	437,720			36,336			7,765			—			481,821
Franchise fees and royalties	1,268			7,850						—			9,118
International Association assessments and other fees	462			1,230			20,315			(22,007		)	—
Total revenues	439,450			45,416			28,080			(22,007		)	490,939
Operating Costs and Expenses:
Company venue operating costs:
Cost of food and beverage	47,658			6,438			1,099			—			55,195
Cost of entertainment and merchandise	15,757			902			330			—			16,989
Total cost of food, beverage, entertainment and merchandise	63,415			7,340			1,429			—			72,184
Labor expenses	119,109			7,802			2,537			—			129,448
Depreciation and amortization	55,158			1,235			969			—			57,362
Rent expense	44,367			2,712			1,120			—			48,199
Other venue operating expenses	68,639			4,536			1,930			(1,718		)	73,387
Total company venue operating costs	350,688			23,625			7,985			(1,718		)	380,580
Advertising expense	21,222			2,719			21,609			(20,289		)	25,261
General and administrative expenses	12,928			20,726			285			—			33,939
Transaction, severance and related litigation costs	1,129			55			—			—			1,184
Total operating costs and expenses	385,967			47,125			29,879			(22,007		)	440,964
Operating income (loss)	53,483			(1,709		)	(1,799		)	—			49,975
Equity in earnings (loss) in affiliates	(5,795		)	—			—			5,795			—
Interest expense	32,081			1,887			214			—			34,182
Income (loss) before income taxes	15,607			(3,596		)	(2,013		)	5,795			15,793
Income tax expense (benefit)	6,744			751			(565		)	—			6,930
Net income (loss)	$	8,863		$	(4,347	)	$	(1,448	)	$	5,795		$	8,863
Components of other comprehensive income (loss), net of tax:
Foreign currency translation adjustments	915			—			915			(915		)	915
Comprehensive income (loss)	$	9,778		$	(4,347	)	$	(533	)	$	4,880		$	9,778

Condensed Consolidating Cash Flow Statement

CEC Entertainment, Inc.
Consolidating Statement of Cash Flows
For the Six Months Ended July 2, 2017
(in thousands)
	Issuer			Guarantors			Non-Guarantors			Eliminations		Consolidated
Cash flows provided by (used in) operating activities:	$	55,867		$	20,594		$	294		$	—	$	76,755
Cash flows from investing activities:
Purchases of property and equipment	(32,066		)	(14,330		)	(649		)	—		(47,045		)
Development of internal use software	—			(2,075		)	—			—		(2,075		)
Proceeds from sale of property and equipment	237			—			—			—		237
Cash flows provided by (used in) investing activities	(31,829		)	(16,405		)	(649		)	—		(48,883		)
Cash flows from financing activities:
Repayments on senior term loan	(3,800		)	—			—			—		(3,800		)
Repayments on note payable	—			(13		)	—			—		(13		)
Proceeds from sale-leaseback transaction	4,073			—			—			—		4,073
Payments on capital lease obligations	(215		)	—			(3		)	—		(218		)
Payments on sale leaseback transactions	(1,161		)	—			—			—		(1,161		)
Return of capital	1,447			—			—			—		1,447
Cash flows provided by (used in) financing activities	344			(13		)	(3		)	—		328
Effect of foreign exchange rate changes on cash	—			—			239			—		239
Change in cash and cash equivalents	24,382			4,176			(119		)	—		28,439
Cash and cash equivalents at beginning of period	53,088			1,158			6,777			—		61,023
Cash and cash equivalents at end of period	$	77,470		$	5,334		$	6,658		$	—	$	89,462

CEC Entertainment, Inc.
Consolidating Statement of Cash Flows
For the Six Months Ended July 3, 2016
(in thousands)
	Issuer				Guarantors				Non-Guarantors				Eliminations			Consolidated
Cash flows provided by (used in) operating activities:	$	66,349			$	11,899			$	(510	)		$	—		$	77,738
Cash flows from investing activities:
Purchases of property and equipment	(31,814		)		(10,459		)		(127		)		—			(42,400		)
Development of internal use software	(3,439		)		(2,784		)		—				—			(6,223		)
Proceeds from the sale of property and equipment	—				318				—				—			318
Cash flows provided by (used in) investing activities	(35,253		)	—	(12,925		)	—	(127		)	—	—		—	(48,305		)
Cash flows from financing activities:
Repayments on senior term loan	(3,800		)		—				—				—			(3,800		)
Repayments on note payable	—				(24		)		—				—			(24		)
Payments on capital lease obligations	(202		)		—				(2		)		—			(204		)
Payments on sale leaseback transactions	(956		)		—				—				—			(956		)
Excess tax benefit realized from stock-based compensation	4				—				—				—			4
Cash flows provided by (used in) financing activities	(4,954		)	—	(24		)	—	(2		)	—	—		—	(4,980		)
Effect of foreign exchange rate changes on cash	—				—				484				—			484
Change in cash and cash equivalents	26,142			—	(1,050		)	—	(155		)	—	—		—	24,937
Cash and cash equivalents at beginning of period	42,235				1,797				6,622				—			50,654
Cash and cash equivalents at end of period	$	68,377			$	747			$	6,467			$	—		$	75,591