Seaport Entertainment Group Inc. Q4 FY2025 earnings call

• 2025 Achievements: Generated 24% year-over-year improvement in net loss and 49% year-over-year improvement in non-GAAP adjusted net loss. Leasing, programming, and finalizing development plans for approx. 153,000 square feet across the seaport. Internalized food and beverage operations. Las Vegas Aviators won 2025 Pacific Coast League Championship. Hosted multiple marquee events. Put 250 Water Street under contract to sell (closed in early February 2026) generating net proceeds of ~$75 million. Closed Tin Building in its current form as a culinary experience and signed new lease with Lux Entertainment for Balloon Museum.
• Future Plans: Signed 10-year agreement with a Brooklyn-based arts, culture, and hospitality concept. Will open new 400-seat, 1,000-person open container district anchored by Sadie's. Closed Malibu farm location of Pier 17. Intends to expand Pier 17 event space from 17,500 sq ft to over 40,000 sq ft across three floors. Ramping up for 2026 Seaport Concert Series at the rooftop at Pier 17

Hospitality Segment

• Fourth quarter 2025: Revenues declined 23% on a pro forma basis, primarily due to lower performance at the Tin Building and unfavorable year-over-year comparisons. Total food and beverage revenues within the hospitality segment, inclusive of lawn clubs, declined 15% year-over-year. On a same-store basis, food and beverage revenue declined 20%. Hospitality consolidated adjusted EBITDA, including earnings from unconsolidated ventures, improved by $11 million year-over-year on a pro forma basis in Q4 2025.
• Full year 2025: Revenue declined by 16% on a pro forma basis. Total 2025 food and beverage revenue, including Lawn Club, declined 8% year over year. On a same-store basis, food and beverage revenue declined 5%. Hospitality consolidated adjusted EBITDA increased $10.5 million year-over-year on a pro forma basis.

Entertainment Segment

• Fourth quarter 2025: Revenues increased 68% year over year, primarily driven by the internalization of Enchant operations in Las Vegas. Concert series food and beverage revenue increased 3% year-over-year. Entertainment operating EBITDA increased 18% year-over-year in Q4 2025.
• Full year 2025: Total year-over-year entertainment revenues increased 14%. Adjusted EBITDA for the entertainment segment increased by 124% compared to the prior year.

Landlord Segment

• Fourth quarter 2025: Rental revenue increased 14% year over year on a pro forma basis. Landlord consolidated adjusted EBITDA declined by $10.1 million on a pro forma basis.
• Full year 2025: Rental revenue increased 21% year-over-year on a pro forma basis. The landlord segment's 2025 consolidated adjusted EBITDA declined 55% year-over-year on a pro forma basis

• Expect continued margin improvement in 2026 across the entire Las Vegas operation as they apply learnings from Enchant and better control certain variable expenses.
• The expanded event space at Pier 17 is currently expected to generate long-term, unlevered cash-on-cash returns above 20% with an estimated payback period under five years

• The process of finalizing the sale of 250 Water Street was longer than anticipated, requiring additional diligence and evaluating market conditions.
• The repositioning of the Tin Building to Balloon Museum involves uncertainties in the operating model and potential challenges in achieving long-term sustainability.
• There is a risk associated with the remaining vacancy in the Seaport neighborhood, including challenges in leasing to complementary daily needs and amenity-oriented tenants.
• G&A expenses, although improved, are still affected by factors such as leadership transition, and there could be fluctuations in expenses throughout the year

Q: Matthew Edner with Jones Trading asked about how much of the $163 million cash pro forma is committed to current projects and deployment of remaining cash, internal hurdles for event space deployment, remaining space at the Seaport and its growth potential, special events, and G&A run rate.

A: Lena and Matt responded discussing capital allocation expectations, that it's a moving target for event space hurdles, plans for remaining space with restaurant concepts and anchors like Balloon Museum, upcoming special events including around FIFA World Cup and America's 250-year anniversary, and that Q4 2025 is a reference point for G&A with Q1 having transitional costs.

Q: Patrick Betelhofer with Kahn Brothers Group asked about criteria for the buyback program, how the new Balloon Museum complements or competes with Meow Wolf, details on the apartment building at 85 South Street, and how Vegas properties fit into the company.

A: Management stated buyback program is used opportunistically, Balloon Museum is complementary to Meow Wolf, the apartment building is cash flowing with almost 100% leased and interest ramped up, and Vegas properties have a phenomenal ballpark with room to create value through Enchant experience implementation and better cost controls