- Third quarter revenue of $279.0 million, net income of $14.0
million and Adjusted EBITDA of $61.1 million
- Entered into definitive agreements to sell Rocky Gap Casino
Resort for $260.0 million; transaction expected to close in second
quarter of 2023
- Repaid $25.0 million of term loan borrowings; increased
stock buyback authorization to $75.0 million
Golden Entertainment, Inc. (NASDAQ: GDEN) (“Golden
Entertainment” or the “Company”) today reported financial results
for the third quarter ended September 30, 2022. The Company
generated third quarter revenue of $279.0 million, net income of
$14.0 million and Adjusted EBITDA of $61.1 million.
Blake Sartini, Chairman and Chief Executive Officer of Golden
Entertainment, commented, “Our quarterly results continue to be
significantly above 2019 levels, despite reflecting a larger impact
from seasonality compared to the same period last year. We are
encouraged by the current business trends to start the fourth
quarter and we are well positioned to succeed in any economic
environment. Our third quarter was also highlighted by our
announcement to sell our Rocky Gap Casino Resort for $260 million,
which will allow us to focus further on our core operations,
maintaining the strength of our balance sheet and opportunistically
returning capital to shareholders.”
Consolidated Results
Revenues of $279.0 million for the third quarter of 2022 were
down 1% from $282.4 million for the third quarter of 2021. Net
income for the third quarter of 2022 was $14.0 million, or $0.45
per fully diluted share, compared to net income of $29.1 million,
or $0.91 per fully diluted share, for the third quarter of 2021.
Third quarter 2022 Adjusted EBITDA was $61.1 million, a 17% decline
from Adjusted EBITDA of $73.4 million for the third quarter of
2021. Adjusted EBITDA margin was 22% for third quarter of 2022
compared to 26% for the third quarter of 2021.
Nevada Casino Resorts
Revenues for Nevada Casino Resorts were $98.9 million for the
third quarter of 2022 compared to $104.4 million for the third
quarter of 2021. Third quarter 2022 Adjusted EBITDA was $30.1
million compared to $39.2 million for the third quarter of 2021.
Adjusted EBITDA margin was 30% for the third quarter of 2022
compared to 38% for the third quarter of 2021.
Nevada Locals Casinos
Revenues for Nevada Locals Casinos were $37.7 million for the
third quarter of 2022 compared to $38.1 million for the third
quarter of 2021. Third quarter 2022 Adjusted EBITDA was $16.8
million compared to $18.1 million for the third quarter of 2021.
Adjusted EBITDA margin was 45% for the third quarter of 2022
compared to 48% for the third quarter of 2021.
Maryland Casino Resort
Revenues for Maryland Casino Resort were $21.6 million both for
the third quarter of 2022 and 2021. Third quarter 2022 Adjusted
EBITDA was $7.4 million compared to $7.7 million for the third
quarter of 2021. Adjusted EBITDA margin was 34% for the third
quarter of 2022 compared to 35% for the third quarter of 2021.
On August 24, 2022, the Company entered into definitive
agreements to sell the Rocky Gap Casino Resort for aggregate cash
consideration of $260 million. Pursuant to the terms of the
agreements, Century Casinos, Inc. will acquire the operations of
the Rocky Gap Casino Resort for $56.1 million, subject to customary
working capital adjustments, and VICI Properties Inc. will acquire
an interest in the associated land and buildings for $203.9
million. The Company expects the transactions to close during the
second quarter of 2023, subject to the satisfaction of customary
regulatory approvals and closing conditions.
Distributed Gaming
Revenues for Distributed Gaming were $117.6 million for the
third quarter of 2022 compared to $117.9 million for the third
quarter of 2021. Third quarter 2022 Adjusted EBITDA was $18.8
million compared to $21.2 million for the third quarter of 2021.
Adjusted EBITDA margin was 16% for the third quarter of 2022
compared to 18% for the third quarter of 2021.
Debt and Liquidity
During the third quarter of 2022, the Company repaid $25 million
of its outstanding term loan. As of September 30, 2022, the
Company’s total principal amount of debt outstanding was $940.2
million, consisting primarily of $600 million in outstanding term
loan borrowings and $337.5 million of senior unsecured notes. As of
September 30, 2022, the Company had cash and cash equivalents of
$177.7 million, short-term cash investments of $5.0 million, and
there continues to be no outstanding borrowings under the Company’s
$240 million revolving credit facility.
As of September 30, 2022, the Company had approximately $27.5
million remaining under its current share repurchase authorization,
which was increased to $75.0 million on November 1, 2022.
Investor Conference Call and
Webcast
The Company will host a webcast and conference call today,
November 3, 2022, at 5:00 p.m. Eastern Time, to discuss the results
for the third quarter of 2022. The conference call may be accessed
live over the phone by dialing (844) 826-3033 or (412) 317-5185 for
international callers. A replay will be available beginning at 8:00
p.m. Eastern Time today and may be accessed by dialing (844)
512-2921 or (412) 317-6671 for international callers; the passcode
is 10171295. The replay will be available until November 10, 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 Rocky
Gap transactions, including the anticipated timing of the closing
of the transaction and satisfaction of regulatory and other
conditions; the Company’s strategies, objectives, business
opportunities and plans for future expansion, developments or
acquisitions; 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: risks and uncertainties related to the Rocky
Gap transactions, including the failure to obtain, or delays in
obtaining, required regulatory approvals or clearances; the failure
to satisfy any of the closing conditions to the Rocky Gap
transactions on a timely basis or at all; 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;
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, 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 and
hospitality assets that focus on casino and distributed gaming
operations (including gaming in the Company’s branded taverns).
Golden Entertainment operates nearly 17,000 slots, over 100 table
games, and over 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 more than 60 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 September
30,
Nine Months Ended September
30,
2022
2021
2022
2021
Revenues
Gaming
$
188,420
$
193,167
$
575,886
$
575,124
Food and beverage
43,035
44,271
129,942
123,013
Rooms
30,765
31,566
89,685
80,213
Other
16,773
13,418
46,496
36,235
Total revenues
278,993
282,422
842,009
814,585
Expenses
Gaming
108,040
106,301
323,431
309,478
Food and beverage
33,090
32,182
97,093
85,256
Rooms
14,337
13,220
40,627
35,213
Other operating
4,531
4,635
13,853
10,430
Selling, general and administrative
59,389
54,457
177,586
161,333
Depreciation and amortization
24,286
26,474
75,894
80,342
Loss (gain) on disposal of assets
266
(72
)
935
747
Preopening expenses
2
3
61
232
Total expenses
243,941
237,200
729,480
683,031
Operating income
35,052
45,222
112,529
131,554
Non-operating (expense) income
Other non-operating income
—
—
—
60,000
Interest expense, net
(15,709
)
(15,535
)
(45,565
)
(47,752
)
Loss on debt extinguishment
(158
)
(759
)
(1,412
)
(759
)
Total non-operating (expense) income,
net
(15,867
)
(16,294
)
(46,977
)
11,489
Income before income tax (provision)
benefit
19,185
28,928
65,552
143,043
Income tax (provision) benefit
(5,182
)
123
5,737
(366
)
Net income
$
14,003
$
29,051
$
71,289
$
142,677
Weighted-average common shares
outstanding
Basic
28,505
28,950
28,757
28,599
Diluted
31,148
31,854
31,640
31,537
Net income per share
Basic
$
0.49
$
1.00
$
2.48
$
4.99
Diluted
$
0.45
$
0.91
$
2.25
$
4.52
Golden Entertainment, Inc.
Reconciliation of Adjusted EBITDA (Unaudited, in
thousands)
Three Months Ended September
30,
Nine Months Ended September
30,
2022
2021
2022
2021
Revenues
Nevada Casino Resorts (1)
Gaming
$
42,812
$
46,216
$
133,156
$
135,060
Food and beverage
21,537
22,449
66,044
60,129
Rooms
26,068
27,643
76,670
69,436
Other
8,439
8,072
26,919
20,567
Nevada Casino Resorts revenue
$
98,856
$
104,380
$
302,789
$
285,192
Nevada Locals Casinos (2)
Gaming
$
27,457
$
28,437
$
85,886
$
91,226
Food and beverage
6,208
6,081
18,688
17,918
Rooms
2,325
1,858
7,098
5,419
Other
1,745
1,729
5,737
5,614
Nevada Locals Casinos revenues
$
37,735
$
38,105
$
117,409
$
120,177
Maryland Casino Resort (3)
Gaming
$
16,027
$
16,502
$
45,940
$
45,985
Food and beverage
2,463
2,314
6,333
5,867
Rooms
2,372
2,065
5,917
5,358
Other
762
759
1,872
1,770
Maryland Casino Resort revenues
$
21,624
$
21,640
$
60,062
$
58,980
Distributed Gaming (4)
Gaming
$
102,124
$
102,012
$
310,904
$
302,853
Food and beverage
12,827
13,427
38,877
39,099
Other
2,695
2,496
8,456
7,295
Distributed Gaming revenues
$
117,646
$
117,935
$
358,237
$
349,247
Corporate and other
3,132
362
3,512
989
Total Revenues
$
278,993
$
282,422
$
842,009
$
814,585
(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 September
30,
Nine Months Ended September
30,
(In thousands)
2022
2021
2022
2021
Adjusted EBITDA
Nevada Casino Resorts (1)
$
30,122
$
39,196
$
102,589
$
112,486
Nevada Locals Casinos (2)
16,818
18,103
56,651
61,230
Maryland Casino Resort (3)
7,446
7,669
20,260
20,831
Distributed Gaming (4)
18,845
21,158
63,092
66,952
Corporate and other
(12,176
)
(12,698
)
(39,196
)
(37,561
)
Total Adjusted EBITDA
$
61,055
$
73,428
$
203,396
$
223,938
Adjustments
Other non-operating income
—
—
—
60,000
Depreciation and amortization
(24,286
)
(26,474
)
(75,894
)
(80,342
)
Change in non-cash lease expense
298
143
(113
)
(517
)
Share-based compensation
(3,286
)
(3,089
)
(10,269
)
(8,762
)
(Loss) gain on disposal of assets
(266
)
72
(935
)
(747
)
Loss on debt extinguishment
(158
)
(759
)
(1,412
)
(759
)
Preopening and related expenses (5)
(2
)
(3
)
(61
)
(232
)
Other, net
1,539
1,145
(3,595
)
(1,784
)
Interest expense, net
(15,709
)
(15,535
)
(45,565
)
(47,752
)
Income tax (provision) benefit
(5,182
)
123
5,737
(366
)
Net income
$
14,003
$
29,051
$
71,289
$
142,677
(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/20221103006149/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
Golden Entertainment (NASDAQ:GDEN)
Historical Stock Chart
From Sep 2024 to Oct 2024
Golden Entertainment (NASDAQ:GDEN)
Historical Stock Chart
From Oct 2023 to Oct 2024