DS Stock Price, News & Analysis

Drive Shack Inc. (DS) is described as a leading owner and operator of golf-related leisure and entertainment businesses. The company is associated with the finance and insurance sector under the "Other Financial Vehicles" industry classification, while its operating activities focus on golf-centered entertainment and traditional golf operations.

According to its public communications, Drive Shack Inc. focuses on bringing people together through competitive socializing built around golf. Its portfolio has included three primary brands: American Golf, Drive Shack venues, and Puttery. The company characterizes these businesses as golf-related leisure and entertainment operations.

Business focus and brand portfolio

Drive Shack Inc. states that it operates golf-related leisure and entertainment businesses. In its description, the company highlights a portfolio consisting of American Golf, Drive Shack venues and Puttery. American Golf is referred to as the company’s traditional golf business, while Drive Shack venues and Puttery are described together as its entertainment golf business.

The company has reported that its entertainment golf business is comprised of Drive Shack and Puttery venues, and that its traditional golf business operates under the American Golf name. In its communications, Drive Shack Inc. has emphasized event revenue and venue performance across these brands as important aspects of its operations.

Puttery concept

Drive Shack Inc. has described Puttery as a modern spin on putting that combines a lively atmosphere with scoring technology and themed courses for an immersive guest experience. The company’s news releases describe Puttery venues as multi-story, indoor spaces with uniquely themed nine-hole putting courses, bars, lounge areas and event capabilities. Puttery locations referenced in company communications include venues in The Colony, Texas; Charlotte, North Carolina; Washington, D.C.; Houston; Chicago; and Minneapolis, among other markets under development at the time of those announcements.

Company materials describe Puttery venues as offering themed courses such as "Library," "Lodge" and "Conservatory," along with food, beverages and social competition. The company has also highlighted Puttery’s use of technology in scoring and its positioning as an entertainment golf experience.

Drive Shack venues and American Golf

Drive Shack Inc. has referred to its Drive Shack venues and American Golf operations as core parts of its portfolio. In its reports, the company groups Drive Shack and Puttery venues together as its entertainment golf business and American Golf as its traditional golf business. Company disclosures indicate that revenue from golf operations and from the sale of food and beverages are important components of its reported results.

In its financial reporting, Drive Shack Inc. has broken out revenue between its entertainment golf business (Drive Shack and Puttery venues) and its traditional golf business (American Golf). The company has also highlighted event revenue across its Drive Shack venues, Puttery venues and American Golf courses.

Public company status and trading venue

Drive Shack Inc. was previously listed on the New York Stock Exchange under the symbol DS. The company disclosed that it received a notice from the NYSE that it was not in compliance with the continued listing standard requiring a minimum average closing price of its common stock of $1.00 per share over a consecutive 30 trading-day period. Following this notice, Drive Shack Inc. announced its intention to voluntarily delist its securities from the NYSE and to deregister its common stock under Section 12(b) and Section 12(g) of the Securities Exchange Act of 1934, as amended, and to suspend its reporting obligations under Section 15(d) of the Exchange Act.

In that announcement, the company stated that it evaluated whether to remain listed or to "go dark" and determined that going dark was its preferred path due to expected cost savings and what it described as its current inability to realize traditional benefits of public company status. It cited low trading value, low trading volume, limited liquidity and difficulty raising capital from public markets or attracting institutional investors and market analysts as factors in its decision, while still incurring the expenses and indirect costs of being a public company.

Drive Shack Inc. indicated that it anticipated filing a Form 25 with the Securities and Exchange Commission relating to the delisting and deregistration of its securities from the NYSE and that it planned to file a Form 15 to deregister its securities under Section 12(g) and suspend its reporting obligations under Section 15(d), noting that each series of its securities was held by fewer than 300 stockholders of record.

The company also stated its intention to apply for quotation of its common stock on the OTCQX platform operated by OTC Markets Group Inc., and to seek approval within a specified timeframe. In a later communication, Drive Shack Inc. referenced its OTC landing page and indicated that financial results for a fiscal year were available through its annual report on that OTC platform.

Capital structure and securities

Drive Shack Inc. has described multiple classes of securities, including common stock and several series of preferred stock. In its public disclosures, the company noted that its securities include Series B, Series C and Series D preferred stock, preferred stock purchase rights and common stock. It has also disclosed the existence of junior subordinated notes payable.

The company has reported that its preferred stock carries stated dividend rates and liquidation preferences, and it has announced dividends on its preferred stock for specific periods, specifying per-share dividend amounts for each series. These disclosures indicate that preferred stock dividends have been an ongoing consideration in the company’s capital structure.

Financial reporting and performance metrics

Drive Shack Inc. has released detailed financial information, including consolidated balance sheets and consolidated statements of operations. It has reported revenues from golf operations and from the sale of food and beverages, and it has discussed operating expenses, general and administrative expenses, depreciation and amortization, pre-opening costs, and gains or losses on lease terminations and impairment.

The company has also presented non-GAAP financial measures, including Adjusted EBITDA, which it defines as GAAP net income (loss) adjusted for income tax expenses, other income (loss), interest expenses, interest and investment income, depreciation and amortization, gain (loss) on lease terminations, impairment and other losses, pre-opening costs and certain other non-recurring items. Drive Shack Inc. has explained that it uses this measure to evaluate the financial performance of its entertainment and traditional golf venues and has provided reconciliations to GAAP measures.

In its communications, the company has highlighted revenue growth in its entertainment golf business and traditional golf business over comparative periods, as well as changes in operating income or loss and consolidated net income or loss. It has also discussed event revenue trends and pre-opening costs associated with new Puttery venues.

Events and venue usage

Drive Shack Inc. has emphasized event-driven usage of its venues. For its Puttery venues, the company has highlighted features such as multiple private spaces, AV-equipped rooms, outdoor spaces and the ability to host a range of group sizes, including full venue and floor buyouts. It has described Puttery venues as suitable for corporate events, holiday parties and other celebrations.

For its broader portfolio, the company has reported significant increases in event revenue at American Golf courses and Drive Shack venues over comparative periods. These disclosures suggest that events and group bookings are an important part of how the company utilizes its golf-related leisure and entertainment assets.

Delisting and deregistration context

Drive Shack Inc. has provided context for its decision to delist and deregister its securities. It stated that the reduction in time spent by management and employees on SEC reporting requirements would allow greater focus on managing the company’s businesses, strengthening relationships with clients and vendors and pursuing long-term growth. The company also noted that, following delisting, there is no guarantee that a broker will continue to make a market in its common stock, that trading will be approved or continue on OTC markets, or that it will continue to provide information sufficient for brokers to quote its common stock.

At the same time, Drive Shack Inc. indicated an intention to continue providing information to stockholders and to take actions to enable a trading market in its common stock to exist, while acknowledging the uncertainties associated with trading on OTC platforms.

Risk disclosures and forward-looking statements

In its public releases, Drive Shack Inc. has included forward-looking statements disclaimers under the Private Securities Litigation Reform Act of 1995. These disclaimers identify forward-looking terminology and emphasize that such statements are subject to risks and uncertainties. The company has also discussed the limitations of non-GAAP financial measures and encouraged investors to review related GAAP measures and reconciliations.

Summary

Overall, Drive Shack Inc. presents itself as a company centered on golf-related leisure and entertainment, with a portfolio that includes traditional golf operations and entertainment golf venues. Its communications highlight Puttery as a modern, themed putting experience, alongside Drive Shack venues and American Golf operations. The company has undergone a transition from NYSE listing toward OTC trading, with an expressed intention to reduce public company reporting costs while continuing to operate its golf-related businesses.