Investing.com -- Shares in Dave & Buster’s Entertainment (NASDAQ:PLAY) rose fractionally on Tuesday evening after the Dallas-based entertainment-themed restaurant chain lifted its forward guidance amid stronger-than-expected earnings over the first quarter.
During the first quarter of Fiscal Year 2016, Dave and Busters saw its revenues surge 16% to $262 million amid strong metrics in both comparable-store and new restaurant sales. Consequently, the company reported net profits of $31.2 million or earnings per share of 0.72, up significantly from earnings of $19.5 million or 0.46 per share last year over the same quarter.
Analysts expected revenue of $251.4 million on earnings per share of 0.59. The stellar quarterly provides strong indications that Dave & Buster's multi-year expansion plan is headed in the right direction.
"We are off to a great start in fiscal 2016 with results that surpassed our expectations and are pleased to already be raising our annual outlook," said Steve King, Dave & Busters CEO. "Our unique entertainment, dining, and sports viewing venues are demonstrating their broad-based appeal despite challenges affecting many of our casual dining peers and we are committed to keeping our brand fresh through a continuous stream of ‘new news' to further differentiate ourselves."
King's optimism stems from a lucrative quarter by the company's new restaurants scattered throughout the U.S. in Rochester, New York; El Paso, Texas; and Capitol Heights, Maryland. Over the previous three-month period, Dave & Buster's non-comparable restaurant sales contributed $31.1 million to the company's bottom line, representing one of the best quarters in company history. At the same time, comp sales rose 3.6% driven by a sharp increase in walk-in revenues.
"Our comparable store sales have now exceeded the competitive casual dining benchmark for 16 straight quarters and reached 13.5% on a two-year stacked basis. The continued shift in revenues to our higher-margin amusement category coupled with operating leverage enabled us to grow Adjusted EBITDA and Margins by 28.4% and 250 basis points, respectively. In doing so, we set new first quarter records for these metrics," King added.
Moving forward, Dave & Busters increased its full-year guidance to earnings per share between 1.85 and 1.97 along with revenues in a range of $983 and $995 million. Previously, the company expected annual revenues of $967 to $987 million.
Shares in Dave & Busters ticked up 0.39 or 0.94% to 41.86 in after-hours trading.