- Fourth quarter revenue of $230.7 million, net loss of $9.4
million and Adjusted EBITDA of $48.8 million
- 2023 full year revenue of $1.1 billion, net income of $255.8
million and Adjusted EBITDA of $222.5 million
- In January 2024 completed $213.5 million sale of the Nevada
distributed gaming business; combined with non-core divestitures in
2023, generated over $600 million total proceeds
- Over $60 million of debt repaid in the fourth quarter; $239
million of total debt repaid in 2023
- Initiated recurring quarterly cash dividend of $0.25 per
share
Golden Entertainment, Inc. (NASDAQ: GDEN) (“Golden
Entertainment” or the “Company”) today reported financial results
for the fourth quarter and full year ended December 31, 2023. In
addition, on February 27, 2024, the Company’s Board of Directors
declared a recurring quarterly cash dividend of $0.25 per share of
the Company’s outstanding common stock, the first of which is
payable on April 4, 2024 to shareholders of record as of March 18,
2024.
Blake Sartini, Chairman and Chief Executive Officer of Golden,
commented, “In January, we completed the sale of our Nevada
distributed gaming business, completing a year-long process of
divesting our non-core assets that also included the sale of our
casino resort in Maryland and our Montana distributed gaming
business. Following these transactions, our portfolio is comprised
of Nevada casino resorts, Nevada locals casinos and Nevada’s
largest branded tavern portfolio, all of which are expected to
benefit from Nevada’s positive economic trends. The completion of
our non-core divestitures generated significant cash proceeds,
which strengthened our balance sheet, created strategic and
financial flexibility, and facilitates returning capital to our
shareholders.”
On January 10, 2024, the Company completed the previously
disclosed sale of its distributed gaming operations in Nevada to an
affiliate of J&J Ventures Gaming, LLC for cash consideration of
approximately $213.5 million, subject to customary working capital
and other adjustments, plus purchased cash (comprised of cash and
cash equivalents related to such operations at the time of closing)
of approximately $37.5 million.
During the fourth quarter of 2023, the Company repurchased $59.0
million in principal amount of its senior unsecured notes in open
market transactions, thereby reducing the aggregate principal
amount of the senior unsecured notes outstanding to $276.5 million.
The Company repaid $238.6 million of its debt obligations in
2023.
Consolidated Results
Fourth quarter 2023 revenues were $230.7 million, compared to
$279.7 million for the fourth quarter of 2022. Net loss for the
fourth quarter of 2023 was $9.4 million, or a loss of $0.33 per
share, primarily as a result of an asset impairment charge of $12.1
million related to the Colorado Belle Casino Resort, the operations
of which remain suspended. Fourth quarter of 2022 net income was
$11.1 million, or $0.35 per fully diluted share. Fourth quarter
2023 Adjusted EBITDA was $48.8 million, compared to Adjusted EBITDA
of $63.7 million for the fourth quarter of 2022. The year-over-year
declines in revenues and Adjusted EBITDA were primarily due to the
exclusion in the 2023 fourth quarter of results for the Company’s
Rocky Gap Casino Resort and distributed gaming operations in
Montana that were sold on July 25, 2023 and September 13, 2023,
respectively.
For both the full year 2023 and 2022, revenues were $1.1
billion. Net income for the full year 2023 was $255.8 million, or
$8.31 per fully diluted share, compared to net income of $82.3
million, or $2.61 per fully diluted share, for the full year 2022.
Net income and diluted earnings per share for the full year 2023
include the benefit of the $303.2 million gain on the sales of the
Rocky Gap Casino Resort and distributed gaming operations in
Montana. During 2023, the Company incurred transaction costs of
$8.3 million and $0.8 million on the sales of the Rocky Gap Casino
Resort and distributed gaming operations in Montana, respectively,
and $0.4 million in transaction costs related to the sale of the
Nevada distributed gaming operations sold subsequent to the fiscal
year end. Full year 2023 Adjusted EBITDA of $222.5 million declined
from Adjusted EBITDA of $267.1 million for the full year 2022
primarily due to the exclusion of the results for the businesses
sold in 2023.
Debt and Liquidity
As of December 31, 2023, the Company’s total principal amount of
debt outstanding was $677.7 million, consisting primarily of $398.0
million in outstanding term loan borrowings and $276.5 million of
senior unsecured notes. As of December 31, 2023, the Company had
cash and cash equivalents of $197.6 million, which excludes the
proceeds from the sale of the Company’s distributed gaming
operations in Nevada that closed on January 10, 2024. There
continues to be no outstanding borrowings under the Company’s $240
million revolving credit facility.
Investor Conference Call and
Webcast
The Company will host a webcast and conference call today,
February 29, 2024 at 5:00 p.m. Eastern Time (2:00 p.m. Pacific
Time), to discuss the 2023 fourth quarter and full year results.
The conference call may be accessed live over the phone by dialing
(833) 816-1405 or (412) 317-0498 for international callers. A
replay will be available beginning at 7:00 p.m. Eastern Time today
and may be accessed by dialing (844) 512-2921 or (412) 317-6671 for
international callers; the passcode is 10185511. The replay will be
available until March 7, 2024. 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, business opportunities and plans;
anticipated future growth and trends in the Company’s business or
key markets; the payment of recurring quarterly cash dividends;
projections of future financial condition, operating results or
other financial items; 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:
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; 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 assets, severance
expenses, preopening and related expenses, gain or loss on disposal
of assets and businesses, share-based compensation expenses,
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
Golden Entertainment owns and operates a diversified
entertainment platform, consisting of a portfolio of gaming and
hospitality assets that focus on casino and branded tavern
operations. Golden Entertainment owns eight casinos and 69 gaming
taverns in Nevada, operating over 5,600 slots, 100 table games, and
over 6,000 hotel rooms. For more information, visit
www.goldenent.com.
Golden Entertainment,
Inc.
Consolidated Statements of
Operations
(Unaudited, in thousands, except
per share data)
Three Months Ended December
31,
Year Ended December
31,
2023
2022
2023
2022
Revenues
Gaming
$
138,682
$
185,020
$
674,301
$
760,906
Food and beverage
45,096
45,421
182,408
175,363
Rooms
31,737
32,639
124,649
122,324
Other
15,176
16,630
71,791
63,126
Total revenues
230,691
279,710
1,053,149
1,121,719
Expenses
Gaming
72,803
105,553
379,929
428,984
Food and beverage
34,130
34,770
135,373
131,863
Rooms
16,179
15,787
62,297
56,414
Other operating
5,193
6,036
22,415
19,889
Selling, general and administrative
58,709
57,818
255,565
235,404
Depreciation and amortization
21,758
24,229
88,933
100,123
(Gain) loss on disposal of assets
(103
)
(1
)
(228
)
934
Loss (gain) on sale of businesses
2,650
—
(303,179
)
—
Preopening expenses
185
100
760
161
Impairment of assets
12,072
—
12,072
—
Total expenses
223,576
244,292
653,937
973,772
Operating income
7,115
35,418
399,212
147,947
Non-operating expense
Interest expense, net
(13,170
)
(17,925
)
(65,515
)
(63,490
)
Loss on debt extinguishment and
modification
(1,329
)
(178
)
(1,734
)
(1,590
)
Total non-operating expense,
net
(14,499
)
(18,103
)
(67,249
)
(65,080
)
(Loss) income before income tax
provision
(7,384
)
17,315
331,963
82,867
Income tax provision
(1,988
)
(6,258
)
(76,207
)
(521
)
Net (loss) income
$
(9,372
)
$
11,057
$
255,756
$
82,346
Weighted-average common shares
outstanding
Basic
28,627
28,507
28,653
28,662
Diluted
28,627
31,230
30,781
31,514
Net (loss) income per share
Basic
$
(0.33
)
$
0.39
$
8.93
$
2.87
Diluted
$
(0.33
)
$
0.35
$
8.31
$
2.61
Golden Entertainment,
Inc.
Reconciliation of Adjusted
EBITDA
(Unaudited, in thousands)
Three Months Ended December
31,
Year Ended December
31,
2023
2022
2023
2022
Revenues
Nevada Casino Resorts (1)
$
104,796
$
104,161
$
413,058
$
406,950
Nevada Locals Casinos (2)
38,467
40,105
157,435
157,514
Maryland Casino Resort (3)
—
17,948
43,456
78,010
Nevada Taverns (4)
27,763
26,884
109,215
109,965
Distributed Gaming (5)
59,323
90,316
320,680
365,472
Corporate and other
342
296
9,305
3,808
Total Revenues
$
230,691
$
279,710
$
1,053,149
$
1,121,719
Adjusted EBITDA
Nevada Casino Resorts (1)
$
29,664
$
32,515
$
120,256
$
135,104
Nevada Locals Casinos (2)
17,337
19,197
73,846
75,848
Maryland Casino Resort (3)
—
5,123
12,652
25,383
Nevada Taverns (4)
8,175
7,872
32,682
37,610
Distributed Gaming (5)
6,370
10,667
34,545
44,021
Corporate and other
(12,786
)
(11,690
)
(51,459
)
(50,886
)
Total Adjusted EBITDA
$
48,760
$
63,684
$
222,522
$
267,080
Adjustments
Depreciation and amortization
(21,758
)
(24,229
)
(88,933
)
(100,123
)
Non-cash lease expense
29
(52
)
15
(165
)
Share-based compensation
(2,851
)
(3,164
)
(13,476
)
(13,433
)
Gain (loss) on disposal of assets
103
1
228
(934
)
(Loss) gain on sale of businesses
(2,650
)
—
303,179
—
Loss on debt extinguishment and
modification
(1,329
)
(178
)
(1,734
)
(1,590
)
Preopening and related expenses (6)
(185
)
(100
)
(760
)
(161
)
Severance expenses
(21
)
(83
)
(149
)
(378
)
Impairment of assets
(12,072
)
—
(12,072
)
—
Other, net
(2,240
)
(639
)
(11,342
)
(3,939
)
Interest expense, net
(13,170
)
(17,925
)
(65,515
)
(63,490
)
Income tax provision
(1,988
)
(6,258
)
(76,207
)
(521
)
Net (loss) income
$
(9,372
)
$
11,057
$
255,756
$
82,346
(1)
Comprised of The STRAT Hotel, Casino &
Tower, Aquarius Casino Resort and Edgewater 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, which was sold on July 25, 2023.
(4)
Comprised of the operations of the
Company’s 69 branded tavern locations.
(5)
Comprised of distributed gaming operations
in Nevada and Montana. On September 13, 2023, the Company completed
the sale of its distributed gaming operations in Montana.
Subsequent to the fiscal year end, the Company completed the sale
of its distributed gaming operations in Nevada on January 10,
2024.
(6)
Preopening and related expenses consist of
labor, food, utilities, training, initial licensing, rent and
organizational costs incurred in connection with the opening of
branded tavern and casino locations as well as food and beverage
and other venues within the Company’s casino locations.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20240229128609/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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