Full House Resorts Announces Strong Results for First Quarter of 2016
- Consolidated Net Revenues Increased 10.1% From First Quarter of 2015
- Adjusted EBITDA for the First Quarter of 2016 Rose 66.7% to
- Both Rising Star and the Northern Nevada Segment Generated Strong Growth in the Period
- Company Expects to Close on
- Net Loss for the First Quarter of 2016 Improved to
"We are proud of our Company's continued growth in the first quarter of 2016, this time led by our Rising Star and
"At Rising Star," continued Mr. Lee, "we had our best first quarter in several years. A continued focus on our marketing strategies resulted in net revenues that increased by
"At the Silver Slipper, net revenues rose by 8.2%, in part due to the opening of our new hotel, which opened in stages between
"For our
"Lastly," concluded Mr. Lee, "while no deal is truly complete until the signatures are exchanged, we believe we are very close to simultaneously closing on the refinancing of our debt and the acquisition of
On a consolidated basis, net revenues in the first quarter of 2016 increased 10.1% to
First Quarter 2016 Highlights and Subsequent Events
- Net revenues at the
Silver Slipper Casino and Hotel rose 8.2% in the first quarter of 2016 to$14.8 million from$13.7 million in the prior-year quarter. Adjusted Property EBITDA was flat at$2.7 million for the first quarter of both years. Results in the 2016 period were affected by the flooding of roads throughout theGulf Coast area, which impacted customer traffic to our property, particularly on a few key weekends. Additionally, we had an increase in operating costs related to the Silver Slipper's new hotel, which opened in stages betweenMay 2015 andSeptember 2015 . Hotel occupancy improved throughout the quarter, rising from 72% inJanuary 2016 to 91% inMarch 2016 . - At the Rising Star Casino Resort, net revenues increased by 10.2% to
$12.2 million in the 2016 first quarter, the result of several new marketing initiatives. Careful cost controls resulted in Adjusted Property EBITDA rising to$1.3 million , a$1.1 million improvement from Adjusted Property EBITDA of$205,000 in the first quarter of 2015. - The
Northern Nevada segment consists of the Grand Lodge and Stockman’s casinos.The Grand Lodge Casino benefited from improved snowfall and visitation to the ski resorts surrounding Grand Lodge, as well as an increase in the table games hold percentage. Stockman's Casino benefited from casino layout and carpet improvements inNovember 2015 , as well as marketing enhancements and certain management and operational changes.Northern Nevada net revenues rose 15.8% to$4.9 million from$4.2 million in the 2015 first quarter. Adjusted Property EBITDA for theNorthern Nevada segment more than doubled to$767,000 in the first quarter of 2016 from$363,000 in the 2015 period. - On
September 27, 2015 , the Company entered into an agreement to purchase the assets and certain liabilities ofBronco Billy's Casino and Hotel inCripple Creek, Colorado for$30.0 million , subject to working capital and other certain adjustments. Upon entering the agreement, the Company made a$2.5 million deposit which would be forfeited under most circumstances if the transaction is not consummated. Targeting the approximately 700,000 people in the Colorado Springs MSA,Bronco Billy's has approximately 830 slot and video poker machines, 13 table games, a 24-room hotel, a steakhouse, four casual dining outlets, and an outdoor amphitheater. We expect to close on this acquisition in mid-May, in connection with the refinancing of the Company's outstanding first and second lien debt and subject to regulatory approvals and completion of other customary closing conditions. - On
March 16, 2016 , the Company amended the hotel lease for The Lodge at Rising Star, one of two hotels that the Company operates at Rising Star Casino Resort. The Company and the hotel's landlord,Rising Sun/Ohio County First, Inc. , agreed to: (i) extend the initial term of the hotel lease by four years toOctober 1, 2027 , and (ii) reduce the monthly rent fromApril 2016 throughMarch 2020 by approximately$1 million in total. In return for such revisions, the Company committed to invest at least$1 million in capital improvements at the Rising Star property. Effectively, the transaction helps fund a portion of the planned improvements on terms that are attractive to the Company. - In
July 2015 , the Company reached a settlement with the Nambe Pueblo tribe related to funds previously advanced by the Company to Nambe Pueblo as part of a development agreement and a security and reimbursement agreement from 2005. In consideration for the release of any future claims and other items as defined within the settlement agreement, Nambe Pueblo was expected to pay a total of$500,000 to the Company. The first installment of$250,000 was received inJuly 2015 . The remaining$250,000 balance was received in the first quarter of 2016. - The Company incurred approximately
$287,000 of project development and acquisition expenses during the first quarter of 2016. This amount primarily consists of costs related to the Company's pending acquisition ofBronco Billy's Casino and Hotel and its pursuit of growth opportunities inIndianapolis and other potential markets.
Liquidity and Capital Resources
As of
Conference Call Information
The Company will host a conference call for investors today,
A replay of the conference call will be available shortly after the conclusion of the call through
Forward-looking Statements
This press release contains statements by Full House and its officers that are "forward-looking statements" within the meaning of the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. Forward-looking statements are neither historical facts nor assurances of future performance. Some forward-looking statements in this press release include those regarding Full House’s receipt of remaining regulatory approvals, completion of its debt refinancing, closing of its acquisition of
(a) Reconciliation of Non-GAAP Financials
We define “Adjusted EBITDA” as earnings before interest and other non-operating income (expense), taxes, depreciation and amortization, impairment charges, asset write-offs, recoveries, gain (loss) from asset disposals, board and executive transition costs, pre-opening expenses, project development and acquisition costs, and non-cash share-based compensation expense. “Adjusted Property EBITDA” is Adjusted EBITDA before corporate related costs and expenses which are not allocated to each property. Although Adjusted EBITDA and Adjusted Property EBITDA are not measures of performance or liquidity calculated in accordance with generally accepted accounting principles (“GAAP”), we believe these non-GAAP financial measures provide meaningful supplemental information regarding our performance and liquidity. We utilize Adjusted EBITDA and Adjusted Property EBITDA internally to focus management on year-over-year changes in our core operating performance, which we consider our ordinary, ongoing and customary operations and which we believe is useful information to investors. Accordingly, management excludes certain items when analyzing core operating performance, such as the items mentioned above, that management believes are not reflective of ordinary, ongoing and customary operations.
In addition, because Adjusted EBITDA and Adjusted Property EBITDA are not calculated in accordance with GAAP, they may not necessarily be comparable to similarly titled measures employed by other companies. A reconciliation of Adjusted EBITDA and Adjusted Property EBITDA is presented below. However, you should not consider these measures in isolation or as substitutes for operating income, cash flows from operating activities, or any other measure for determining our operating performance or liquidity that is calculated in accordance with GAAP. You are encouraged to evaluate these adjustments and the reasons we consider them appropriate for supplemental analysis. In evaluating Adjusted EBITDA and Adjusted Property EBITDA, you should be aware that, in the future, we may incur expenses that are the same as or similar to some of the adjustments in this presentation. Our presentation of Adjusted EBITDA and Adjusted Property EBITDA should not be construed as an inference that our future results will be unaffected by unusual or non-recurring items.
FULL HOUSE RESORTS, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF OPERATIONS (In thousands, except per share data) (Unaudited) |
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Three Months Ended March 31, |
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2016 | 2015 | ||||||
Revenues | |||||||
Casino | $ | 29,130 | $ | 26,354 | |||
Food and beverage | 6,229 | 5,849 | |||||
Hotel | 1,965 | 1,279 | |||||
Other operations | 739 | 638 | |||||
Gross revenues | 38,063 | 34,120 | |||||
Less promotional allowances | (6,056 | ) | (5,036 | ) | |||
Net revenues | 32,007 | 29,084 | |||||
Operating costs and expenses | |||||||
Casino | 14,685 | 13,732 | |||||
Food and beverage | 1,966 | 2,100 | |||||
Hotel | 202 | 120 | |||||
Other operations | 303 | 268 | |||||
Selling, general and administrative | 11,340 | 10,844 | |||||
Project development, acquisition costs and other | 287 | 42 | |||||
Depreciation and amortization | 1,693 | 1,992 | |||||
30,476 | 29,098 | ||||||
Operating income (loss) | 1,531 | (14 | ) | ||||
Other expense, net | |||||||
Interest expense, net of capitalized interest | (1,762 | ) | (1,525 | ) | |||
Other | — | 12 | |||||
(1,762 | ) | (1,513 | ) | ||||
Loss before income taxes | (231 | ) | (1,527 | ) | |||
Provision for income taxes | 99 | 228 | |||||
Net loss | $ | (330 | ) | $ | (1,755 | ) | |
Basic and diluted loss per share | $ | (0.02 | ) | $ | (0.09 | ) | |
Basic and diluted weighted average number of common shares outstanding | 18,969 | 18,877 | |||||
Full House Resorts, Inc. Supplemental Information Segment Revenues and Adjusted EBITDA and Reconciliation of Adjusted EBITDA to Operating Income (Loss) and Net Loss (In Thousands, Unaudited) |
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Three months ended | |||||||
March 31, | |||||||
2016 | 2015 | ||||||
Net Revenues | |||||||
Silver Slipper Casino and Hotel | $ | 14,845 | $ | 13,724 | |||
Rising Star Casino Resort | 12,246 | 11,115 | |||||
Northern Nevada Casinos | 4,916 | 4,245 | |||||
$ | 32,007 | $ | 29,084 | ||||
Adjusted EBITDA | |||||||
Silver Slipper Casino and Hotel | $ | 2,661 | $ | 2,696 | |||
Rising Star Casino Resort | 1,301 | 205 | |||||
Northern Nevada Casinos | 767 | 363 | |||||
Corporate | (1,161 | ) | (1,123 | ) | |||
3,568 | 2,141 | ||||||
Depreciation and amortization | (1,693 | ) | (1,992 | ) | |||
Impairments | — | (84 | ) | ||||
Pre-opening costs | — | (38 | ) | ||||
Project development & acquisition costs | (287 | ) | (4 | ) | |||
Stock compensation | (57 | ) | (37 | ) | |||
Operating income (loss) | 1,531 | (14 | ) | ||||
Non-operating expense, net | |||||||
Interest expense, net of capitalized interest | (1,762 | ) | (1,525 | ) | |||
Other | — | 12 | |||||
(1,762 | ) | (1,513 | ) | ||||
Loss before income taxes | (231 | ) | (1,527 | ) | |||
Provision for income taxes | 99 | 228 | |||||
Net loss | $ | (330 | ) | $ | (1,755 | ) | |
About
Contact:Lewis Fanger , Chief Financial OfficerFull House Resorts, Inc. 702-221-7800 www.fullhouseresorts.com