DDE Dover Downs Gaming & Entertainment

Dover Downs Gaming & Entertainment, Inc. (NYSE: DDE) today reported results for the fourth quarter and year ended December 31, 2013.

The Company’s revenues were $46,592,000 for the fourth quarter of 2013 compared with $48,559,000 for the fourth quarter of 2012.

Gaming revenues of $40,775,000 were down 5.7% compared to the fourth quarter of last year.

Other operating revenues improved to $5,817,000 from $5,310,000 due to higher cash rooms and food and beverage revenue. Occupancy levels in the Dover Downs Hotel were approximately 81% for the fourth quarter of 2013 and 2012.

General and administrative and depreciation expense were both lower than the fourth quarter of 2012.

Interest expense increased to $485,000 during the quarter as a result of higher interest rates and fees offsetting lower average outstanding borrowings.

Net loss was ($418,000), or ($.01) per diluted share, compared with a net loss of ($528,000), or ($.02) per diluted share for the fourth quarter of 2012.

Net earnings for the year were $13,000, or $.00 per diluted share compared with $4,807,000 or $.15 per diluted share for 2012.

This release contains or may contain forward-looking statements based on management’s beliefs and assumptions. Such statements are subject to various risks and uncertainties that could cause results to vary materially. Please refer to the Company’s SEC filings for a discussion of such factors.

Owned by Dover Downs Gaming & Entertainment, Inc. (NYSE: DDE), Dover Downs Hotel & Casino® is a premier gaming and entertainment resort destination in the Mid-Atlantic region. Gaming operations consist of approximately 2,500 slots and a full complement of table games including poker. The AAA-rated Four Diamond hotel is Delaware’s largest with 500 luxurious rooms/suites and amenities including a full-service spa/salon, concert hall and 41,500 sq. ft. of multi-use event space. Live, world-class harness racing is featured November through April, and horse racing is simulcast year-round. Professional football parlay betting is accepted during the season. Additional property amenities include multiple restaurants from fine dining to casual fare, bars/lounges and retail shops. For more information, please visit www.doverdowns.com.

  DOVER DOWNS GAMING & ENTERTAINMENT, INC. CONSOLIDATED STATEMENTS OF OPERATIONS In Thousands, Except Per Share Amounts (Unaudited)           Three Months Ended Years Ended December 31, December 31, 2013 2012 2013 2012 Revenues: Gaming (1) $ 40,775 $ 43,249 $ 172,991 $ 203,055 Other operating (2)   5,817     5,310     24,240     22,857     46,592     48,559     197,231     225,912   Expenses: Gaming 38,868 41,000 162,398 182,951 Other operating 4,275 4,009 17,314 16,359 General and administrative 1,335 1,506 5,645 6,034 Depreciation   2,315     2,528     9,726     10,297     46,793     49,043     195,083     215,641     Operating (loss) earnings (201 ) (484 ) 2,148 10,271   Interest expense   (485 )   (388 )   (1,752 )   (1,805 )   (Loss) earnings before income taxes (686 ) (872 ) 396 8,466   Income tax benefit (expense)   268     344     (383 )   (3,659 )   Net (loss) earnings $ (418 ) $ (528 ) $ 13   $ 4,807     Net (loss) earnings per common share: - Basic $ (0.01 ) $ (0.02 ) $ -   $ 0.15   - Diluted $ (0.01 ) $ (0.02 ) $ -   $ 0.15     Weighted average shares outstanding: - Basic 31,849 31,745 31,849 31,745 - Diluted 31,849 31,745 31,849 31,745

 

(1)  

Gaming revenues from the Company’s slot machine and table game operations include the total win from such operations. The Delaware State Lottery Office collects the win and remits a portion thereof to the Company as its commission for acting as a Licensed Agent. The difference between total win and the amount remitted to the Company is reflected in gaming expenses.

 

(2)

Other operating revenues do not include the retail amount of promotional allowances which are provided to customers on a complimentary basis.

 

  DOVER DOWNS GAMING & ENTERTAINMENT, INC. CONSOLIDATED BALANCE SHEETS In Thousands (Unaudited)       December 31,   December 31, 2013 2012 ASSETS   Current assets: Cash $ 12,950 $ 14,993 Accounts receivable 4,248 4,093 Due from State of Delaware 8,225 9,708 Inventories 1,957 1,921 Prepaid expenses and other 2,432 3,207 Income taxes receivable 138 155 Deferred income taxes   1,268     1,284   Total current assets 31,218 35,361   Property and equipment, net 160,570 168,963 Other assets   932     938   Total assets $ 192,720   $ 205,262     LIABILITIES AND STOCKHOLDERS’ EQUITY   Current liabilities: Accounts payable $ 4,480 $ 3,785 Purses due horsemen 7,978 9,833 Accrued liabilities 10,513 10,361 Payable to Dover Motorsports, Inc. 4 - Deferred revenue 463 346 Revolving line of credit   47,040     -   Total current liabilities 70,478 24,325   Revolving line of credit - 58,500 Liability for pension benefits 3,353 6,983 Deferred income taxes   2,725     1,994   Total liabilities   76,556     91,802     Stockholders’ equity: Common stock 1,774 1,590 Class A common stock 1,487 1,660 Additional paid-in capital 4,663 4,136 Retained earnings 109,335 109,322 Accumulated other comprehensive loss   (1,095 )   (3,248 ) Total stockholders’ equity   116,164     113,460   Total liabilities and stockholders’ equity $ 192,720   $ 205,262       DOVER DOWNS GAMING & ENTERTAINMENT, INC. CONSOLIDATED STATEMENTS OF CASH FLOWS In Thousands (Unaudited)     Years Ended December 31, 2013   2012   Operating activities: Net earnings $ 13 $ 4,807

Adjustments to reconcile net earnings tonet cash provided by operating activities:

Depreciation 9,726 10,297 Amortization of credit facility origination fees 183 101 Stock-based compensation 682 793 Deferred income taxes (519 ) (318 ) Gain from insurance settlement (22 ) - Changes in assets and liabilities: Accounts receivable (155 ) (111 ) Due from State of Delaware 1,483 (268 ) Inventories (36 ) (61 ) Prepaid expenses and other 662 310 Income taxes receivable/payable (138 ) (928 ) Accounts payable 915 (470 ) Purses due horsemen (1,855 ) 829 Accrued liabilities 152 (1,571 ) Payable to Dover Motorsports, Inc. 4 (11 ) Deferred revenue 117 92 Other liabilities   (75 )   (325 ) Net cash provided by operating activities   11,137     13,166     Investing activities: Capital expenditures (1,574 ) (2,625 ) Insurance proceeds 74 - Purchase of available-for-sale securities (37 ) - Proceeds from sale of available-for-sale securities   31     -   Net cash used in investing activities   (1,506 )   (2,625 )   Financing activities: Borrowings from revolving line of credit 72,160 19,620 Repayments of revolving line of credit (83,620 ) (30,120 ) Dividends paid - (3,575 ) Repurchase of common stock (144 ) (107 ) Credit facility fees   (70 )   -   Net cash used in financing activities   (11,674 )   (14,182 )   Net decrease in cash (2,043 ) (3,641 ) Cash, beginning of year   14,993     18,634   Cash, end of year $ 12,950   $ 14,993    

Dover Downs Gaming & Entertainment, Inc.Timothy R. Horne - Sr. Vice President-Finance302-857-3292