Drmicrocap
9年前
Golden Entertainment Announces Third Quarter 2015 Results
– Completed Lakes Entertainment/Sartini Gaming Merger in July 2015 –
– Reports Nine Month Combined Adjusted EBITDA of $31.0 million, up 12% –
.
Business Wire
Golden Entertainment, Inc.
November 4, 2015 4:01 PM
LAS VEGAS--(BUSINESS WIRE)--
Golden Entertainment, Inc. (formerly Lakes Entertainment, Inc.) (GDEN) today announced financial results for the third quarter ended September 30, 2015.
Highlights for the Third Quarter Ended September 30, 2015
• On July 31, 2015, Sartini Gaming, Inc. (“Sartini Gaming”) merged with a subsidiary of Lakes Entertainment (the “Merger”). In connection with the Merger, Lakes Entertainment was renamed Golden Entertainment (“Golden Entertainment” or the “Company”). With the completion of the Merger, the Company owns and operates approximately 9,300 gaming devices, as well as approximately 30 table games across four casino properties, 48 taverns and 670 route locations.
• Net revenues for the three months ended September 30, 2015 were $62.5 million, an increase of 292% compared to the prior year period. For the quarter ended September 30, 2015, net income was $3.0 million, or $0.16 per diluted share, compared to a net loss of $(23.1) million, or $(1.72) per diluted share in the prior year quarter. These results include the operations of Sartini Gaming for 61 days during the quarter.
• Combined Net Revenues and Combined Adjusted EBITDA for the quarter ended September 30, 2015 were $86.2 million and $9.9 million, respectively, presented as if the results of Sartini Gaming had been included for the entire 2015 third quarter. The combined results reflect a 6.1% increase in net revenues for the Distributed Gaming segment compared to the prior year quarter.
• On July 31, 2015, the Company completed the syndication of a new $160.0 million senior secured credit facility maturing in 2020, of which $145.0 million was drawn at closing.
• Announced plans to add four Las Vegas tavern locations in 2016, including the opening of the Company’s first brewery.
“This quarter was transformational for the Company and with the completion of the Merger, we have achieved an exceptional combination of assets and team members. Everyone is excited by the opportunities arising out of this transaction,” said Blake L. Sartini, Chief Executive Officer of Golden Entertainment. “Going forward, in addition to the current portfolio that is generating strong free cash flow, we are focused on executing on a broad slate of long-term growth opportunities, both organic as well as strategic, while continuing to deliver a quality experience to customers and generating returns for shareholders.”
Combined Results for the Three and Nine Month Periods Ended September 30, 2015
The following unaudited combined results illustrate the net revenues and Adjusted EBITDA for the Company and Sartini Gaming on a combined basis for the three and nine months ended September 30, 2015 and September 28, 2014, for each segment, presented as if the Merger had occurred on the first day of each period presented. These unaudited combined financial results have been prepared for illustrative purposes only and do not purport to be indicative of the results that actually would have resulted had the Merger occurred on the first day of the periods presented, or of the future results of the Company. The unaudited combined results do not reflect any operating efficiencies and associated cost savings that may be achieved as a result of the Merger.
Unaudited Combined Results(1)(2)
(In thousands)
Three Months Ended (3) Nine Months Ended (4)
September 30, September 28, % September 30, September 28, %
2015 2014 Change 2015 2014 Change
Distributed Gaming $ 61,201 $ 57,673 6.1 % $ 186,008 $ 179,252 3.8 %
Casinos 24,973 25,614 -2.5 % 72,670 72,481 0.3 %
Corporate and other 48 45 6.7 % 324 109 197.2 %
Combined Net Revenues $ 86,222 $ 83,332 3.5 % $ 259,002 $ 251,842 2.8 %
Distributed Gaming $ 8,390 $ 7,182 16.8 % $ 27,739 $ 25,306 9.6 %
Casinos 5,737 5,491 4.5 % 15,257 15,181 0.5 %
Corporate and other (4,201 ) (3,896 ) 7.8 % (12,003 ) (12,890 ) -6.9 %
Combined Adjusted EBITDA $ 9,926 $ 8,777 13.1 % $ 30,993 $ 27,597 12.3 %
(1) Combined Net Revenues and Combined Adjusted EBITDA reflect the operations of Sartini Gaming for periods prior to the Merger combined with the operations of the Company. Such presentation does not conform with GAAP or the Securities and Exchange Commission rules for pro forma presentations; however, we have included the combined results because we believe they provide a meaningful comparison for the periods presented.
(2) The Company’s Distributed Gaming segment involves the installation and operation of gaming devices in certain strategic, high-traffic, non-casino locations (such as grocery stores, convenience stores, restaurants, bars and taverns) in Nevada, and the operation of traditional, branded taverns targeting local patrons, primarily in Clark County, Nevada. The Company’s Casinos segment consists of three casinos in Pahrump, Nevada and the Rocky Gap Casino Resort in Flintstone, Maryland.
(3) The unaudited combined financial information for the three months ended September 30, 2015 and September 28, 2014 is derived from the Company’s unaudited consolidated statements of operations for such periods and Sartini Gaming’s unaudited consolidated statements of operations for the three months ended September 30, 2014 and for the one month ended July 31, 2015.
(4) The unaudited combined financial information for the nine months ended September 30, 2015 and September 28, 2014 is derived from the Company’s unaudited consolidated statements of operations for such periods and Sartini Gaming’s unaudited consolidated statements of operations for the nine months ended September 30, 2014 and for the seven months ended July 31, 2015.
Results for the Three Months Ended September 30, 2015
Net revenues for the three months ended September 30, 2015 were $62.5 million, an increase of 292% compared to the prior year period. Adjusted EBITDA for the current year quarter was $7.1 million, compared to $1.6 million in the prior year quarter.
For the quarter ended September 30, 2015, net income was $3.0 million, or $0.16 per diluted share, compared to a net loss of $(23.1) million, or $(1.72) per diluted share in the prior year quarter. The current year results include the operations of Sartini Gaming for 61 days during the quarter. During the current year quarter, the Company incurred $9.3 million in Merger expenses, as well as an income tax benefit of $12.9 million. The results for the prior year quarter were impacted by impairments and other losses of $21.0 million related to an investment in Rock Ohio Ventures.
Results for the Nine Months Ended September 30, 2015
Net revenues for the nine months ended September 30, 2015 were $90.6 million, an increase of 114% from the prior year period. Adjusted EBITDA for the current year period was $8.9 million, compared to $1.2 million in the prior year.
For the nine months ended September 30, 2015, net income was $1.1 million, or $0.07 per diluted share, compared to a net loss of $(24.8) million, or $(1.85) per diluted share in the prior year period. The current year results include the operations of Sartini Gaming for 61 days during the nine months ended September 30, 2015. During the current year period, the Company incurred $10.6 million in Merger expenses, as well as an income tax benefit of $12.7 million. The results for the prior year period were impacted by impairments and other losses of $21.0 million related to an investment in Rock Ohio Ventures.
Balance Sheet, Liquidity and Capital Expenditures
As of September 30, 2015, the Company had cash and cash equivalents of $43.2 million and total outstanding debt of $146.4 million. Total debt outstanding included a fully drawn $120.0 million senior secured term loan and $25.0 million drawn under the Company’s $40.0 million senior secured revolving credit facility. The Company’s senior secured term loan and revolving credit facilities mature in July 2020. As of September 30, 2015, the weighted average effective interest rate on outstanding borrowings under these credit facilities was approximately 3.0%. Had Sartini Gaming operations been included in the Company’s results for the twelve months ended July 31, 2015, and had the new credit facilities been in place during that period, the Company estimates that it would have achieved combined annual interest expense savings of approximately $18 million as a result of a lower interest rate under the new credit facilities compared to actual rates applicable to the secured debt of the companies during that period.
For the third quarter ended September 30, 2015, capital expenditures were $1.3 million compared to $0.9 million in the prior year quarter.
Investor Conference Call and Webcast
The Company will host a webcast and conference call at 5:00 p.m. Eastern Time on November 4, 2015, to discuss third quarter 2015 results. The number to call is 1-888-438-5535 (domestic) or 1-719-325-2448 (international). A live webcast will be available in the Investors section of the Company’s website (www.goldenent.com). A replay of the conference call will be available through November 12, 2015, by dialing 1-877-870-5176 (domestic) or 1-858-384-5517 (international) and entering the passcode 1464875.
Forward-Looking Statements
This press release may be deemed to contain forward-looking statements that are subject to the safe harbors created under federal securities laws. Forward-looking statements can generally be identified by the use of words such as “anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,” “forecast,” “intend,” “plan,” “project,” “seek,” “should,” “think,” “will,” “would” and similar expressions. In addition, forward-looking statements include statements regarding the Company’s strategies, objectives, business opportunities and plans for future expansion, developments or acquisitions, anticipated future growth or trends in the Company’s business or key markets, projections of future financial condition or operating results, as well as other statements that are not statements of historical fact. Forward-looking statements are subject to assumptions, risks and uncertainties that may change at any time, and readers are therefore cautioned that actual results could differ materially from those expressed in any forward-looking statements. Factors that could cause actual results to differ include: the Company’s ability to realize the anticipated cost savings, synergies and other benefits from the Merger and integration risks, changes in national, regional and local economic and market conditions, legislative and regulatory matters, increases in gaming taxes and fees, litigation, increased competition, the Company’s ability to renew its distributed gaming contracts, reliance on key personnel, the level of the Company’s indebtedness and the Company’s ability to comply with covenants in its debt facilities, terrorist incidents, natural disasters, severe weather conditions, the effects of environmental and structural building conditions, the effects of disruptions to the Company’s information technology systems, and other factors affecting the gaming, entertainment and hospitality industries generally. In addition, please refer to the risk factors contained in the Company’s SEC filings available at www.sec.gov, including the Company’s most recent Annual Report on Form 10-K and Quarterly Reports on Form 10-Q. Readers are cautioned not to place undue reliance on any forward-looking statements, which speak only as of the date of this press release. The Company undertakes no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.
Non-GAAP Financial Measures
To supplement the Company’s consolidated financial statements presented in accordance with generally accepted accounting principles (“GAAP”), the Company uses Adjusted EBITDA, Combined Net Revenues and Combined Adjusted EBITDA, which measures the Company believes are appropriate to provide meaningful comparison with, and to enhance an overall understanding of, the Company’s past financial performance and prospects for the future. The Company believes Adjusted EBITDA and Combined Adjusted EBITDA provide useful information to both management and investors by excluding specific expenses that the Company believes are not indicative of its core operating results. Further, Adjusted EBITDA is a measure of operating performance used by management, as well as industry analysts, to evaluate operations and operating performance and is widely used in the gaming industry. The presentation of this additional information is not meant to be considered in isolation or as a substitute for measures of financial performance prepared in accordance with GAAP. A reconciliation of net Income (loss) to Adjusted EBITDA and Combined Adjusted EBITDA is provided in the financial information tables below. Additionally, a reconciliation of net revenues to Combined Net Revenues is provided in the financial information tables below.
The Company defines “Adjusted EBITDA” as earnings before interest and other non-operating income (expense), taxes, depreciation and amortization, preopening expenses, merger expenses, share-based compensation expenses, impairments and other gains and losses. “Adjusted EBITDA” for a particular segment is Adjusted EBITDA before corporate overhead, which is not allocated to each segment.
About Golden Entertainment, Inc.
Golden Entertainment, Inc. owns and operates gaming properties across two divisions – distributed gaming and resort and casino operations. Golden Entertainment operates more than 9,300 gaming devices and 30 table games in Nevada and Maryland. The Company owns four casino properties, nearly 50 taverns and operates more than 670 distributed gaming locations in Nevada and Maryland. Golden Entertainment is focused on maximizing the value of its portfolio by leveraging its scale, leadership position, and proven management capabilities across its two divisions. For more information, visit www.goldenent.com.
Golden Entertainment, Inc.
Consolidated Statements of Operations and Comprehensive Income (Loss)
(Unaudited and in thousands)
Three Months Ended Nine Months Ended
September 30, September 28, September 30, September 28,
2015 2014 2015 2014
Revenues
Gaming $ 52,336 $ 12,072 $ 74,746 $ 33,460
Food and beverage 9,230 1,835 12,320 4,660
Rooms 2,141 1,940 5,010 4,884
Other operating 1,873 873 3,061 1,913
Gross Revenues 65,580 16,720 95,137 44,917
Less: Promotional allowances (3,068 ) (790 ) (4,530 ) (2,570 )
Net revenues 62,512 15,930 90,607 42,347
Expenses
Gaming 35,661 6,841 48,284 19,208
Food and beverage 6,824 1,366 9,143 3,589
Rooms 270 226 643 509
Other operating 813 470 1,555 1,131
Selling, general and administrative 12,134 5,455 22,542 16,918
Merger expenses 9,325 - 10,591 -
Gain on sale of cost method investment - - (750 ) (1,000 )
Charges related to arbitration award - 2,530 - 2,530
Impairments and other losses - 20,997 682 20,997
Preopening expenses 129 - 129 -
Gain on sale of land - (66 ) - (66 )
Loss on disposal of property and equipment 8 37 6 61
Depreciation and amortization 5,100 896 6,859 2,613
Total expenses 70,264 38,752 99,684 66,490
Loss from operations (7,752 ) (22,822 ) (9,077 ) (24,143 )
Other income (expense)
Interest expense, net (980 ) (258 ) (1,423 ) (813 )
Loss on extinguishment of debt (1,174 ) - (1,174 ) -
Other, net 50 4 86 169
Total other expense (2,104 ) (254 ) (2,511 ) (644 )
Loss before income taxes (9,856 ) (23,076 ) (11,588 ) (24,787 )
Benefit for income taxes 12,874 - 12,702 -
Net income (loss) 3,018 (23,076 ) 1,114 (24,787 )
Other comprehensive income (loss) 20 (3 ) 22 (2 )
Comprehensive income (loss) $ 3,038 $ (23,079 ) $ 1,136 $ (24,789 )
Weighted-average common shares outstanding
Basic 18,821 13,389 15,240 13,376
Dilutive impact of stock options 241 - 213 -
Diluted 19,062 13,389 15,453 13,376
Net income (loss) per share
Basic $ 0.16 $ (1.72 ) $ 0.07 $ (1.85 )
Diluted $ 0.16 $ (1.72 ) $ 0.07 $ (1.85 )
Golden Entertainment, Inc.
Consolidated Balance Sheets
(Unaudited and in thousands)
September 30, December 28,
2015 2014
ASSETS
Current assets
Cash and cash equivalents $ 43,156 $ 35,416
Short-term investments - 46,638
Accounts receivable, net of allowance for doubtful accounts of $0.6 million as of September 30, 2015
4,492 622
Income taxes receivable 2,299 -
Prepaid expenses 7,566 760
Other 2,716 425
Total current assets 60,229 83,861
Property and equipment 120,219 41,433
Accumulated depreciation (10,985 ) (8,694 )
Property and equipment, net 109,234 32,739
Other assets
Goodwill 90,639 -
Intangible assets, net 81,814 2,279
Land held for sale 960 -
Land held for development - 960
Income taxes receivable - 2,155
Other 2,502 35
Total other assets 175,915 5,429
Total assets $ 345,378 $ 122,029
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities
Current portion of long term debt, net of discount $ 7,273 $ 1,368
Accounts payable 6,130 482
Accrued taxes, other than income taxes 645 439
Accrued payroll and related 3,614 1,573
Deposits 284 131
Other accrued expenses 3,454 1,479
Total current liabilities 21,400 5,472
Long-term debt, net of current portion and discount 139,100 8,941
Debt issuance costs, net (2,619 ) -
Other long-term obligations 2,996 -
Total liabilities 160,877 14,413
Commitments and contingencies
Shareholders' equity
Common stock, $0.01 par value; authorized 100,000 shares; 21,624 and 13,389 common shares issued and outstanding as of September 30, 2015 and December 28, 2014, respectively
350 268
Additional paid-in-capital 281,282 205,615
Retained earnings (accumulated deficit) (97,131 ) (98,245 )
Accumulated other comprehensive loss - (22 )
Total shareholders' equity 184,501 107,616
Total liabilities and shareholders' equity $ 345,378 $ 122,029
Golden Entertainment, Inc.
Reconciliation of Net Income (Loss) to Adjusted EBITDA
(Unaudited and in thousands)
Three Months Ended Nine Months Ended
September 30, September 28, September 30, September 28,
2015 2014 2015 2014
Adjusted EBITDA $ 7,101 $ 1,639 $ 8,850 $ 1,202
Preopening expenses (129 ) - (129 ) -
Impairments and other losses - (20,997 ) (682 ) (20,997 )
Share-based compensation (291 ) (67 ) (410 ) (210 )
Merger expenses (9,325 ) - (10,591 ) -
Depreciation and amortization (5,100 ) (896 ) (6,859 ) (2,613 )
Other, net (8 ) (2,501 ) 744 (1,525 )
Loss from operations (7,752 ) (22,822 ) (9,077 ) (24,143 )
Other income (expense)
Interest expense, net (980 ) (258 ) (1,423 ) (813 )
Other, net (1,124 ) 4 (1,088 ) 169
Total other expense, net (2,104 ) (254 ) (2,511 ) (644 )
Loss before income taxes (9,856 ) (23,076 ) (11,588 ) (24,787 )
Benefit for income taxes 12,874 - 12,702 -
Net income (loss) $ 3,018 $ (23,076 ) $ 1,114 $ (24,787 )
Sartini Gaming, Inc.
Reconciliation of Net Loss to Adjusted EBITDA
(Unaudited and in thousands)
One Month
Ended
Three Months
Ended
Seven Months
Ended
Nine Months
Ended
July 31, September 30, July 31, September 30,
2015 2014 2015 2014
Adjusted EBITDA $ 2,825 $ 7,138 $ 22,143 $ 26,395
Preopening expenses (106 ) (962 ) (565 ) (1,472 )
Debt restructuring expense (2,408 ) - (2,408 ) -
Merger expenses (88 ) (17 ) (1,372 ) (21 )
Depreciation and amortization (1,256 ) (3,956 ) (8,272 ) (10,988 )
Other, net 149 (260 ) (2,093 ) (418 )
Income (loss) from operations (884 ) 1,943 7,433 13,496
Other income (expense)
Interest expense, net (1,878 ) (5,444 ) (12,795 ) (16,157 )
Total other expense, net (1,878 ) (5,444 ) (12,795 ) (16,157 )
Loss before income taxes (2,762 ) (3,501 ) (5,362 ) (2,661 )
Benefit for income taxes - - - -
Net loss $ (2,762 ) $ (3,501 ) $ (5,362 ) $ (2,661 )
Golden Entertainment, Inc.
Reconciliation of Net Revenues to Combined Net Revenues
(Unaudited and in thousands)
Combined Net Revenues
Golden Entertainment, Inc. Sartini Gaming Golden Entertainment, Inc.
Three Months Ended One Month Ended Three Months Ended
September 30, July 31, September 30,
2015 2015 2015
Distributed Gaming $ 40,331 $ 20,870 $ 61,201
Casinos 22,133 2,840 24,973
Corporate and other 48 - 48
Net Revenues $ 62,512 $ 23,710 $ 86,222
Combined Net Revenues
Golden Entertainment, Inc. Sartini Gaming Golden Entertainment, Inc.
Three Months Ended Three Months Ended Three Months Ended
September 28, September 30, September 28,
2014 2014 2014
Distributed Gaming $ - $ 57,673 $ 57,673
Casinos 15,887 9,727 25,614
Corporate and other 43 2 45
Net Revenues $ 15,930 $ 67,402 $ 83,332
Combined Net Revenues
Golden Entertainment, Inc. Sartini Gaming Golden Entertainment, Inc.
Nine Months Ended Seven Months Ended Nine Months Ended
September 30, July 31, September 30,
2015 2015 2015
Distributed Gaming $ 40,331 $ 145,677 $ 186,008
Casinos 50,138 22,532 72,670
Corporate and other 138 186 324
Net Revenues $ 90,607 $ 168,395 $ 259,002
Combined Net Revenues
Golden Entertainment, Inc. Sartini Gaming Golden Entertainment, Inc.
Nine Months Ended Nine Months Ended Nine Months Ended
September 28, September 30, September 28,
2014 2014 2014
Distributed Gaming $ - $ 179,252 $ 179,252
Casinos 42,241 30,240 72,481
Corporate and other 106 3 109
Net Revenues $ 42,347 $ 209,495 $ 251,842
Golden Entertainment, Inc.
Reconciliation of Adjusted EBITDA to Combined Adjusted EBITDA
(Unaudited and in thousands)
Combined Adjusted EBITDA
Golden Entertainment, Inc. Sartini Gaming Golden Entertainment, Inc.
Three Months Ended One Month Ended Three Months Ended
September 30, July 31, September 30,
2015 2015 2015
Distributed Gaming $ 5,283 $ 3,107 $ 8,390
Casinos 5,094 643 5,737
Corporate and other (3,276 ) (925 ) (4,201 )
Adjusted EBITDA $ 7,101 $ 2,825 $ 9,926
Combined Adjusted EBITDA
Golden Entertainment, Inc. Sartini Gaming Golden Entertainment, Inc.
Three Months Ended Three Months Ended Three Months Ended
September 28, September 30, September 28,
2014 2014 2014
Distributed Gaming $ - $ 7,182 $ 7,182
Casinos 3,077 2,414 5,491
Corporate and other (1,438 ) (2,458 ) (3,896 )
Adjusted EBITDA $ 1,639 $ 7,138 $ 8,777
Combined Adjusted EBITDA
Golden Entertainment, Inc. Sartini Gaming Golden Entertainment, Inc.
Nine Months Ended Seven Months Ended Nine Months Ended
September 30, July 31, September 30,
2015 2015 2015
Distributed Gaming $ 5,283 $ 22,456 $ 27,739
Casinos 9,603 5,654 15,257
Corporate and other (6,036 ) (5,967 ) (12,003 )
Adjusted EBITDA $ 8,850 $ 22,143 $ 30,993
Combined Adjusted EBITDA
Golden Entertainment, Inc. Sartini Gaming Golden Entertainment, Inc.
Nine Months Ended Nine Months Ended Nine Months Ended
September 28, September 30, September 28,
2014 2014 2014
Distributed Gaming $ - $ 25,306 $ 25,306
Casinos 6,432 8,749 15,181
Corporate and other (5,230 ) (7,660 ) (12,890 )
Adjusted EBITDA $ 1,202 $ 26,395 $ 27,597
View source version on businesswire.com: http://www.businesswire.com/news/home/20151104006743/en/
Contact:
Investor Relations contact:
ICR
Jacques Cornet, 702-891-4264
ir@goldenent.com
or
Media contact:
B&P Public Relations
Lenora Kaplan, 702-589-2791
lkaplan@bpadlv.com
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