– First quarter revenue of $273.6 million, net income of
$36.1 million and Adjusted EBITDA of $67.3 million
– Financial performance for all operating segments exceeded
prior year first quarter results
– Repaid $25 million of term loan borrowings and repurchased
over $15 million of common stock in the quarter
– Board of Directors reauthorized $50 million share
repurchase program
Golden Entertainment, Inc. (NASDAQ: GDEN) (“Golden
Entertainment” or the “Company”) today reported financial results
for the first quarter ended March 31, 2022.
Blake Sartini, Chairman and Chief Executive Officer of Golden
Entertainment, commented, “Our record first quarter results reflect
a continuation of the strong financial performance we delivered
over 2021. Our strong cash flow has allowed us to reduce debt while
returning capital to shareholders through our share repurchase
program. Since the beginning of 2021 we have reduced indebtedness
by $158 million and since December 2021 we have also repurchased
more than $25 million of our common stock. We expect to remain
focused on returning capital to shareholders as the strength in our
business continues.”
Consolidated Results
The Company’s first quarter of 2022 revenues of $273.6 million
rose 14% from $239.7 million for the first quarter of 2021. Net
income for the first quarter of 2022 was $36.1 million, or $1.12
per fully diluted share, compared to net income of $10.6 million,
or $0.35 per fully diluted share, for the first quarter of 2021.
Adjusted EBITDA was $67.3 million for the first quarter of 2022, a
13% increase from Adjusted EBITDA of $59.5 million for the first
quarter of 2021. Adjusted EBITDA margin was 25% for both
periods.
Nevada Casino Resorts
Revenues for Nevada Casino Resorts were $96.4 million for the
first quarter of 2022 compared to $74.8 million for the first
quarter of 2021. Adjusted EBITDA was $33.6 million compared to
$26.7 million for the first quarter of 2021. Adjusted EBITDA margin
was 35% for the first quarter of 2022 compared to 36% for the first
quarter of 2021.
Nevada Locals Casinos
Revenues for Nevada Locals Casinos were $39.9 million for the
first quarter of 2022 compared to $38.5 million for the first
quarter of 2021. Adjusted EBITDA was $20.0 million compared to
$19.6 million for the first quarter of 2021. Adjusted EBITDA margin
was 50% for the first quarter of 2022 compared to 51% for the first
quarter of 2021.
Maryland Casino Resort
Revenues for Maryland Casino Resort were $17.9 million for the
first quarter of 2022 compared to $16.1 million for the first
quarter of 2021. Adjusted EBITDA was $5.6 million compared to $4.9
million for the first quarter of 2021. Adjusted EBITDA margin was
31% for the first quarter of 2022 compared to 30% for the first
quarter of 2021.
Distributed Gaming
Revenues for Distributed Gaming were $119.2 million for the
first quarter of 2022 compared to $109.9 million for the first
quarter of 2021. Adjusted EBITDA was $22.1 million compared to
$20.9 million for the first quarter of 2021. Adjusted EBITDA margin
was 18% for the first quarter of 2022 compared to 19% for the first
quarter of 2021.
Debt and Liquidity
As of March 31, 2022, the total principal amount of debt
outstanding was approximately $1 billion, consisting primarily of
$625 million in term loan borrowings outstanding and $375 million
of senior unsecured notes. As of March 31, 2022, the Company had
cash and cash equivalents of $202.3 million and there continues to
be no outstanding borrowings under the Company’s $240 million
revolving credit facility.
During the first quarter of 2022, the Company repaid $25 million
of its outstanding term loan and repurchased $15.2 million of its
common shares. On May 3, 2022, the Company’s Board of Directors
reauthorized a $50 million share repurchase program.
Investor Conference Call and
Webcast
The Company will host a webcast and conference call today, May
5, 2022, at 5:00 p.m. Eastern Time, to discuss the first quarter of
2022 results. The conference call may be accessed live over the
phone by dialing (800) 920-3359; the passcode is 22018469. A replay
will be available beginning at 7:00 p.m. Eastern Time today and may
be accessed by dialing (800) 633-8284 or (402) 977-9140 for
international callers; the passcode is 22018469. The replay will be
available until May 8, 2022. The call will also be webcast live
through the “Investors” section of the Company’s website,
www.goldenent.com. A replay of the audio webcast will also be
archived on the Company’s website, www.goldenent.com.
Forward-Looking
Statements
This press release contains forward-looking statements regarding
future events and the Company’s future results that are subject to
the safe harbors created under the Securities Act of 1933 and the
Securities Exchange Act of 1934. Forward-looking statements can
generally be identified by the use of words such as “anticipate,”
“believe,” “continue,” “could,” “estimate,” “expect,” “forecast,”
“intend,” “may,” “plan,” “project,” “potential,” “seek,” “should,”
“think,” “will,” “would” and similar expressions, or they may use
future dates. In addition, forward-looking statements in this press
release include, without limitation: statements regarding: the
Company’s strategies, objectives and business opportunities;
anticipated future growth and trends in the Company’s business or
key markets; projections of future financial condition, operating
results, income, capital expenditures, costs or other financial
items, including anticipated future cash generation and resulting
ability to continue to return capital to shareholders; and other
characterizations of future events or circumstances as well as
other statements that are not statements of historical fact.
Forward-looking statements are based on the Company’s current
expectations and assumptions regarding its business, the economy
and other future conditions. These 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 the actual results to differ
materially include: the uncertainty of the extent, duration and
effects of the COVID-19 pandemic and the response of governments;
changes in national, regional and local economic and market
conditions; legislative and regulatory matters (including the cost
of compliance or failure to comply with applicable laws and
regulations); increases in gaming taxes and fees in the
jurisdictions in which the Company operates; the Company’s ability
to realize the anticipated cost savings, synergies and other
benefits of its casino and other acquisitions; litigation;
increased competition; the Company’s ability to renew its
distributed gaming contracts; reliance on key personnel (including
our Chief Executive Officer, President and Chief Financial Officer,
and Chief Operating Officer); the level of the Company’s
indebtedness and its ability to comply with covenants in its debt
instruments; terrorist incidents; natural disasters; severe weather
conditions (including weather or road conditions that limit access
to the Company’s properties); the effects of environmental and
structural building conditions; the effects of disruptions to the
Company’s information technology and other systems and
infrastructure; factors affecting the gaming, entertainment and
hospitality industries generally; and other risks and uncertainties
discussed in the Company’s filings with the SEC, including the
“Risk Factors” sections of the Company’s most recent Annual Report
on Form 10-K and Quarterly Reports on Form 10-Q. The Company
undertakes no obligation to update any forward-looking statements
as a result of new information, future developments or otherwise.
All forward-looking statements in this press release are qualified
in their entirety by this cautionary statement.
Non-GAAP Financial
Measures
To supplement the Company’s consolidated financial statements
presented in accordance with United States generally accepted
accounting principles (“GAAP”), the Company uses Adjusted EBITDA
because it is the primary metric used by its chief operating
decision makers and investors in measuring both the Company’s past
and future expectations of performance. Adjusted EBITDA provides
useful information to the users of the Company’s financial
statements by excluding specific expenses and gains that the
Company believes are not indicative of its core operating results.
Further, the Company’s annual performance plan used to determine
compensation for its executive officers and employees is tied to
the Adjusted EBITDA metric. It is also a measure of operating
performance 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. In
addition, other companies in gaming industry may calculate Adjusted
EBITDA differently than the Company does.
The Company defines “Adjusted EBITDA” as earnings before
interest and other non-operating income (expense), income taxes,
depreciation and amortization, impairment of goodwill and
intangible assets, acquisition and severance expenses, preopening
and related expenses, gain or loss on disposal of assets,
share-based compensation expenses, change in non-cash lease
expense, and other non-cash charges that are deemed to be not
indicative of the Company’s core operating results, calculated
before corporate overhead (which is not allocated to each
reportable segment).
About Golden Entertainment,
Inc.
Golden Entertainment owns and operates a diversified
entertainment platform, consisting of a portfolio of gaming assets
that focus on casino and distributed gaming operations (including
gaming in the Company’s branded taverns). Golden Entertainment
operates over 16,900 slots, 120 table games, and 6,200 hotel rooms.
Golden Entertainment owns ten casinos – nine in Southern Nevada and
one in Maryland. Through its distributed gaming business in Nevada
and Montana, Golden Entertainment operates video gaming devices at
nearly 1,100 locations and owns 65 traditional taverns in Nevada.
Golden Entertainment is also licensed in Illinois and Pennsylvania
to operate video gaming terminals. For more information, visit
www.goldenent.com.
Golden Entertainment,
Inc.
Consolidated Statements of
Operations
(Unaudited, in thousands, except
per share data)
Three Months Ended March
31,
2022
2021
Revenues
Gaming
$
190,787
$
177,000
Food and beverage
42,456
33,804
Rooms
25,746
18,398
Other
14,655
10,494
Total revenues
273,644
239,696
Expenses
Gaming
105,651
96,372
Food and beverage
31,457
23,541
Rooms
12,474
9,610
Other operating
3,976
2,696
Selling, general and administrative
60,910
53,591
Depreciation and amortization
26,276
27,186
(Gain) loss on disposal of assets
(41
)
209
Preopening expenses
55
120
Total expenses
240,758
213,325
Operating income
32,886
26,371
Non-operating expense
Interest expense, net
(15,118
)
(16,048
)
Loss on debt extinguishment and
modification
(181
)
—
Total non-operating expense,
net
(15,299
)
(16,048
)
Income before income tax
benefit
17,587
10,323
Income tax benefit
18,479
297
Net income
$
36,066
$
10,620
Weighted-average common shares
outstanding
Basic
28,894
28,219
Diluted
32,149
30,414
Net income per share
Basic
$
1.25
$
0.38
Diluted
$
1.12
$
0.35
Golden Entertainment,
Inc.
Reconciliation of Adjusted
EBITDA
(Unaudited, in thousands)
Three Months Ended March
31,
2022
2021
Revenues
Nevada Casino Resorts (1)
Gaming
$
44,230
$
38,826
Food and beverage
21,384
14,965
Rooms
22,029
15,628
Other
8,792
5,386
Nevada Casino Resorts revenue
$
96,435
$
74,805
Nevada Locals Casinos (2)
Gaming
$
29,381
$
29,536
Food and beverage
6,179
5,513
Rooms
2,244
1,478
Other
2,085
2,018
Nevada Locals Casinos revenues
$
39,889
$
38,545
Maryland Casino Resort (3)
Gaming
$
14,457
$
13,032
Food and beverage
1,648
1,442
Rooms
1,473
1,292
Other
314
334
Maryland Casino Resort revenues
$
17,892
$
16,100
Distributed Gaming (4)
Gaming
$
102,719
$
95,606
Food and beverage
13,245
11,884
Other
3,258
2,419
Distributed Gaming revenues
$
119,222
$
109,909
Corporate and other
206
337
Total Revenues
$
273,644
$
239,696
(1)
Comprised of The STRAT Hotel, Casino & SkyPod, Aquarius Casino
Resort, Edgewater Hotel & Casino Resort and Colorado Belle
Hotel & Casino Resort.
(2)
Comprised of Arizona Charlie’s Boulder, Arizona Charlie’s Decatur,
Gold Town Casino, Lakeside Casino & RV Park and Pahrump Nugget
Hotel Casino.
(3)
Comprised of the operations of the Rocky Gap Casino Resort.
(4)
Comprised of distributed gaming operations in Nevada and Montana,
as well as branded taverns in Nevada.
Three Months Ended March
31,
(In thousands)
2022
2021
Adjusted EBITDA
Nevada Casino Resorts (1)
$
33,575
$
26,655
Nevada Locals Casinos (2)
20,038
19,552
Maryland Casino Resort (3)
5,572
4,873
Distributed Gaming (4)
22,053
20,880
Corporate and other
(13,913
)
(12,462
)
Total Adjusted EBITDA
$
67,325
$
59,498
Adjustments
Depreciation and amortization
(26,276
)
(27,186
)
Change in non-cash lease expense
(181
)
(439
)
Share-based compensation
(3,672
)
(3,005
)
Gain (loss) on disposal of assets
41
(209
)
Loss on debt extinguishment and
modification
(181
)
—
Preopening and related expenses (5)
(55
)
(120
)
Other, net
(4,296
)
(2,168
)
Interest expense, net
(15,118
)
(16,048
)
Income tax benefit
18,479
297
Net income
$
36,066
$
10,620
(1)
Comprised of The STRAT Hotel, Casino & SkyPod, Aquarius Casino
Resort, Edgewater Hotel & Casino Resort and Colorado Belle
Hotel & Casino Resort.
(2)
Comprised of Arizona Charlie’s Boulder, Arizona Charlie’s Decatur,
Gold Town Casino, Lakeside Casino & RV Park and Pahrump Nugget
Hotel Casino.
(3)
Comprised of the operations of the Rocky Gap Casino Resort.
(4)
Comprised of distributed gaming operations in Nevada and Montana,
as well as branded taverns in Nevada.
(5)
Preopening and related expenses consist of labor, food, utilities,
training, initial licensing, rent and organizational costs incurred
in connection with the opening of tavern and casino locations.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20220505005805/en/
Golden Entertainment, Inc. Charles H. Protell President and
Chief Financial Officer (702) 893-7777
Investor Relations Richard Land JCIR (212) 835-8500 or
gden@jcir.com
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