Condensed Consolidating Schedules

6 Months Ended

Jun. 30, 2019

Condensed Financial Information Disclosure [Abstract]

Condensed Consolidating Financial Statements

Consolidating Guarantor Financial Information:

On February 14, 2014, CEC Entertainment, Inc. (the “Issuer”) merged with and into an entity controlled by Apollo Global Management, LLC and its subsidiaries, which we refer to as the “Merger.” The senior notes issued by the Issuer, in conjunction with the Merger, are our unsecured obligations and are fully and unconditionally, jointly and severally guaranteed by all of our 100% wholly-owned U.S. subsidiaries (the “Guarantors”). Our wholly-owned foreign subsidiaries and our less-than-wholly-owned U.S. subsidiaries are not a party to the guarantees (the “Non-Guarantors”). The following schedules present the condensed consolidating financial statements of the Issuer, Guarantors and Non-Guarantors, as well as consolidated results, for the periods presented:

CEC Entertainment, Inc.
Consolidating Statement of Comprehensive Income (Loss)
For the Six Months Ended June 30, 2019
(in thousands)
	Issuer			Guarantors		Non-Guarantors			Eliminations			Consolidated
Revenues:
Food and beverage sales	$	179,290		$	27,550	$	2,626		$	—		$	209,466
Entertainment and merchandise sales	238,159			23,915		5,016			—			267,090
Total company venue sales	417,449			51,465		7,642			—			476,556
Franchise fees and royalties	1,336			8,986		1,611			—			11,933
International Association assessments and other fees	578			22,225		19,929			(42,732		)	—
Total revenues	419,363			82,676		29,182			(42,732		)	488,489
Operating Costs and Expenses:
Company venue operating costs (excluding Depreciation and amortization):
Cost of food and beverage	39,805			7,235		897			—			47,937
Cost of entertainment and merchandise	19,870			870		458			—			21,198
Total cost of food, beverage, entertainment and merchandise	59,675			8,105		1,355			—			69,135
Labor expenses	124,234			9,744		2,502			—			136,480
Lease costs	49,644			3,722		1,177			—			54,543
Other venue operating expenses	81,543			7,625		1,610			(22,828		)	67,950
Total company venue operating costs	315,096			29,196		6,644			(22,828		)	328,108
Advertising expense	19,913			2,975		20,246			(19,904		)	23,230
General and administrative expenses	9,655			20,736		(498		)	—			29,893
Depreciation and amortization	42,695			4,938		819			—			48,452
Transaction, severance and related litigation costs	31			—		—			—			31
Asset Impairments	1,111			174		—			—			1,285
Total operating costs and expenses	388,501			58,019		27,211			(42,732		)	430,999
Operating income	30,862			24,657		1,971			—			57,490
Equity in earnings in affiliates	20,019			—		—			(20,019		)	—
Interest expense	37,943			1,505		339			—			39,787
Income before income taxes	12,938			23,152		1,632			(20,019		)	17,703
Income tax expense	426			4,559		206			—			5,191
Net income	$	12,512		$	18,593	$	1,426		$	(20,019	)	$	12,512
Components of other comprehensive income (loss), net of tax:
Foreign currency translation adjustments	(285		)	—		(285		)	285			(285		)
Comprehensive income (loss)	$	12,227		$	18,593	$	1,141		$	(19,734	)	$	12,227

CEC Entertainment, Inc.
Consolidating Statement of Comprehensive Income (Loss)
For the Six Months Ended July 1, 2018
(in thousands)
	Issuer			Guarantors		Non-Guarantors			Eliminations			Consolidated
Revenues:
Food and beverage sales	$	184,259		$	27,396	$	2,980		$	—		$	214,635
Entertainment and merchandise sales	215,770			25,874		5,377			—			247,021
Total company venue sales	400,029			53,270		8,357			—			461,656
Franchise fees and royalties	1,000			8,359		1,247			—			10,606
International Association assessments and other fees	574			18,751		19,090			(38,415		)	—
Total revenues	401,603			80,380		28,694			(38,415		)	472,262
Operating Costs and Expenses:
Company venue operating costs (excluding Depreciation and amortization):
Cost of food and beverage	41,733			7,497		1,024			—			50,254
Cost of entertainment and merchandise	16,665			848		289			—			17,802
Total cost of food, beverage, entertainment and merchandise	58,398			8,345		1,313			—			68,056
Labor expenses	117,290			10,088		2,588			—			129,966
Lease costs	43,697			4,008		1,059			—			48,764
Other venue operating expenses	85,295			7,382		1,806			(19,351		)	75,132
Total company venue operating costs	304,680			29,823		6,766			(19,351		)	321,918
Advertising expense	19,758			3,361		22,897			(19,064		)	26,952
General and administrative expenses	8,521			16,837		967			—			26,325
Depreciation and amortization	45,645			5,445		975			—			52,065
Transaction, severance and related litigation costs	459			266		—			—			725
Asset impairment	86			1,505		—			—			1,591
Total operating costs and expenses	379,149			57,237		31,605			(38,415		)	429,576
Operating income (loss)	22,454			23,143		(2,911		)	—			42,686
Equity in earnings in affiliates	14,423			—		—			(14,423		)	—
Interest expense	35,627			1,755		289			—			37,671
Income (loss) before income taxes	1,250			21,388		(3,200		)	(14,423		)	5,015
Income tax expense	(2,006		)	4,414		(649		)	—			1,759
Net income (loss)	$	3,256		$	16,974	$	(2,551	)	$	(14,423	)	$	3,256
Components of other comprehensive income (loss), net of tax:
Foreign currency translation adjustments	300			—		300			(300		)	300
Comprehensive income (loss)	$	3,556		$	16,974	$	(2,251	)	$	(14,723	)	$	3,556