RENO, Nev., July 20, 2022 (GLOBE NEWSWIRE) — Monarch Casino & Resort, Inc. (Nasdaq: MCRI) (“Monarch,” “we,” “our,” or “the Company”) at this time reported working outcomes for the second quarter ended June 30, 2022, as summarized beneath:
($ in 1000’s, besides per share information and percentages)
| Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
| 2022 | 2021 | Increase | 2022 | 2021 | Increase | ||||||||||
| Net income | $ | 115,289 | $ | 97,719 | 18.0% | $ | 223,607 | $ | 172,679 | 29.5% | |||||
| Net earnings(1) | 19,435 | 18,149 | 7.1% | 37,553 | 26,303 | 42.8% | |||||||||
| Adjusted EBITDA(3) | $ | 39,461 | $ | 35,169 | 12.2% | $ | 73,803 | $ | 58,000 | 27.2% | |||||
| Basic EPS | $ | 1.02 | $ | 0.98 | 4.1% | $ | 1.98 | $ | 1.42 | 39.4% | |||||
| Diluted EPS(2) | $ | 0.99 | $ | 0.93 | 6.5% | $ | 1.92 | $ | 1.36 | 41.2% | |||||
- Net Income was negatively impacted by authorized and advisor prices, associated to the continued litigation with the Monarch Black Hawk basic contractor – through the second quarter of 2022 and 2021 by $2.4 million and $0.8 million, respectively, and through the first six months of 2022 and 2021 by $3.7 million and $1.5 million, respectively.
- Diluted EPS was negatively impacted by authorized and advisor prices, associated to the continued litigation with the Monarch Black Hawk basic contractor – through the second quarter of 2022 and 2021 by $0.12 and $0.04 per share, respectively, and through the first six months of 2022 and 2021, by $0.19 and $0.08 per share, respectively.
- Definitions, disclosures and reconciliations of non-GAAP monetary data are included later within the launch.
CEO Comment
John Farahi, Co-Chairman and Chief Executive Officer of Monarch, commented: “Monarch’s solid second quarter results reflect our strong market position in both Reno and Black Hawk. Our quarterly financial results benefited from the continued successful ramp-up of our recently expanded and enhanced Black Hawk property as well as our team’s ability to efficiently manage the business in an ever-changing operating environment.
“Net revenue and Adjusted EBITDA of $115.3 million and $39.5 million, respectively, were both second quarter records. We have been able to partially offset ongoing cost increases with price adjustments. Our ability to nimbly manage and invest in our properties, while maintaining a pristine balance sheet, has positioned us well for the second half of the year.
“In Reno, our redesign and upgrade of the original hotel tower at Atlantis, representing approximately 20% of the property’s room inventory, was completed on schedule and on budget, with the rooms moving back into inventory ahead of the Memorial Day weekend. While Reno remains a very competitive market, we believe our focus on operational execution and capital investments in Atlantis will help us enhance our property’s award-winning appeal and competitiveness. We recently commenced upgrades of the property’s retail space and expect that project to be completed early in the fourth quarter of this year.
“Our favorable balance sheet positions Monarch to continue to evaluate potential acquisitions to drive long-term value for our stockholders.”
Summary of 2022 Second Quarter Operating Results
In the 2022 second quarter, we generated internet income of $115.3 million, a rise of 18.0% from $97.7 million within the prior-year quarter. Casino, meals and beverage (“F&B”), and lodge revenues elevated 10.7%, 28.7% and 31.1% yr over yr, respectively. The enhance in revenues was pushed primarily by the continued ramp-up of operations at Monarch Black Hawk. In the second quarter of 2021, each Atlantis and Black Hawk revenues benefited from COVID-19 associated pent-up demand.
Selling, basic and administrative (“SG&A”) bills for the second quarter of 2022 have been $23.1 million in comparison with $20.6 million within the prior-year interval, pushed primarily by a rise in labor and labor associated bills, in addition to greater utility expense. As a share of internet income, SG&A expense decreased to twenty.0% in comparison with 21.1% within the prior-year interval. Casino working expense as a share of on line casino income elevated to 36.5% through the second quarter of 2022 from 31.7% within the prior-year interval, primarily attributable to a rise in labor bills and elevated promotional allowances. F&B working expense as a share of F&B income decreased to 77.0% through the second quarter of 2022 from 79.2% within the prior-year interval attributable to ongoing efforts to align menu costs with elevated commodity costs and labor prices. Hotel working expense as a share of lodge income decreased to 34.4% within the second quarter of 2022 in comparison with 38.6% in the identical interval a yr in the past, primarily attributable to a rise in Average Daily Rate.
Net earnings within the three months ended June 30, 2022 elevated 7.1% and diluted EPS elevated 6.5% in comparison with the identical interval within the prior yr. Net earnings and diluted EPS for the quarters ending June 30, 2022 and 2021 have been impacted by $2.4 million and $0.8 million, respectively, of authorized and advisor prices associated to litigation with Monarch Black Hawk’s basic contractor.
We generated second quarter 2022 consolidated Adjusted EBITDA of $39.5 million, a rise of $4.3 million, or 12.2%, over the identical interval a yr in the past.
Credit Facility and Liquidity
Capital expenditures of $13.5 million within the second quarter of 2022 primarily included the redesign and improve of the lodge rooms within the authentic tower at Atlantis in addition to ongoing upkeep capital spending at each properties. All capital expenditures have been funded from working money flows. We expensed $0.7 million of curiosity within the second quarter of 2022 in comparison with $1.3 million within the second quarter of 2021.
During the quarter, we funded $15.0 million in principal discount funds on our Term Loan Facility. As of June 30, 2022, we had an excellent principal stability of $65.0 million below our Term Loan, and we had no quantities excellent below our $70.0 million Revolving Credit Facility, which stays out there to us for future wants.
Our Board has reaffirmed its prior authorizations for our beforehand disclosed Stock Repurchase Plan. We proceed to be licensed to buy as much as 2,900,000 shares of our frequent inventory below that plan. Our Repurchase Plan doesn’t obligate us to accumulate any explicit quantity of frequent inventory, and our Repurchase Plan could also be suspended at any time at our discretion. The precise timing, quantity and worth of shares repurchased below our Repurchase Plan will probably be decided by us at our discretion and can rely on plenty of elements, together with the market value of our frequent inventory, basic market financial situations, our liquidity and relevant authorized necessities.
Forward-Looking Statements
This press launch incorporates forward-looking statements inside the which means of the protected harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. Forward-looking statements could be recognized by phrases reminiscent of “plan,” “believe,” “expect,” “seem,” “look,” “look forward,” “positioning,” “future,” “will,” “confident” and related references to future durations. Example of forward-looking statements embody, amongst others, statements we make relating to: (i) our anticipated working outcomes; (ii) our perception that we have now ample liquidity to fund all remaining development and litigation prices and ongoing capital expenditures; (iii) our perception that our business is well-positioned to profit from any post-pandemic restoration and wholesome macroeconomic developments; (iv) our expectation relating to the supply of future acquisition alternatives; (v) our perception relating to the standard of our merchandise and visitor providers in Reno and Black Hawk, together with as premier vacation spot gaming resorts of their respective markets; (vi) our expectations relating to our company’ acceptance of the expanded on line casino, new lodge and enhanced facilities at Monarch Black Hawk; (vii) our expectations relating to our future place in, and share of, the gaming market and the standard of service we offer to our company. Actual outcomes and future occasions and situations could differ materially from these described in any forward-looking statements. Therefore, you shouldn’t depend on any of those forward-looking statements. Important elements that might trigger precise outcomes to vary materially from estimates or projections contained within the forward-looking statements embody, with out limitation:
- persevering with opposed impacts of COVID-19, together with new variants, on our business, development initiatives, monetary situation and working outcomes;
- persevering with actions by authorities officers on the federal, state and/or native stage with respect to steps to be taken, together with, with out limitation, short-term or prolonged shutdowns, journey restrictions, social distancing and shelter-in-place orders, in reference to COVID-19 and its variants;
- our capability to handle visitor security issues brought on by COVID-19 and its variants;
- our capability to successfully handle and management bills throughout short-term or prolonged shutdown durations;
- our capability to keep up compliance with the phrases and situations of our credit score services and different materials contracts within the occasion of any short-term or prolonged shutdowns;
- our capability to barter aid choices and crucial amendments to our Term Loan Facility;
- entry to out there and cheap financing on a well timed foundation;
- our capability to keep up robust working relationships with our regulators, workers, lenders, suppliers, insurance carriers, clients, and different stakeholders;
- impression of any uninsured losses;
- adjustments in visitor visitation or spending patterns attributable to well being or different issues;
- development elements, together with delays, disruptions, availability of labor and supplies, elevated prices of labor and supplies, contractor disagreements, zoning points, environmental restrictions, soil and water situations, climate and different hazards, web site entry issues, constructing allow points and different regulatory approvals or points;
- ongoing disagreements over prices of and accountability for delays and different development associated issues with our basic contractor at Monarch Casino Resort Spa Black Hawk, together with, as beforehand reported, the litigation in opposition to us by such contractor;
- claims for development defects, breach of contract, breach of guarantee, fraud, fraudulent inducement, negligence or different development associated claims that we could have in reference to development and completion of Monarch Casino Resort Spa Black Hawk and any opposed impacts on operations required to right the identical;
- our submitting of affirmative defenses and intensive counterclaims in opposition to the final contractor of Monarch Casino Resort Spa Black Hawk, within the above-mentioned litigation during which litigation the events are presently conducting discovery, and investigation of the claims by and in opposition to us is due to this fact ongoing;
- our potential must put up bonds or different types of surety to assist our authorized cures;
- dangers associated to improvement and development actions (together with disputes with and defaults by contractors and subcontractors; development, tools or staffing issues and delays; shortages of supplies or expert labor; environmental, well being and issues of safety; climate and different hazards, web site entry issues, and unanticipated price will increase);
- our capability to generate ample working money movement to assist finance our enlargement plans and subsequent debt discount;
- adjustments in legal guidelines mandating will increase in minimal wages and worker advantages;
- adjustments in legal guidelines and laws allowing expanded and different types of gaming in our key markets;
- the consequences of native and nationwide financial, credit score and capital market situations on the economy typically and on the gaming business and our business specifically, together with predictions for a possible recession;
- the consequences of labor shortages on our market place, progress and monetary outcomes;
- the potential of will increase in state and federal taxation to handle budgetary and different impacts referring to COVID-19;
- the potential of elevated regulatory and different burdens to handle the direct and oblique impacts of COVID-19;
- visitor acceptance of our expanded services as soon as accomplished and the ensuing impression on our market place, progress and monetary outcomes;
- competitors in our goal market areas;
- broad-based inflation, together with wage inflation; and
- the impression of the occasions occurring in Eastern Europe and the battle going down in Ukraine.
Additional data regarding potential elements that might adversely have an effect on all forward-looking statements, together with the Company’s monetary outcomes, is included in our Securities and Exchange Commission filings, together with our most up-to-date annual report on Form 10-Ok and quarterly studies on Form 10-Q, which can be found on our web site at www.monarchcasino.com.
About Monarch Casino & Resort, Inc.
Monarch Casino & Resort, Inc., by way of its subsidiaries, owns and operates the Atlantis Casino Resort Spa (“Atlantis”), a lodge/on line casino facility in Reno, Nevada, and the Monarch Casino Resort Spa Black Hawk (“Monarch Black Hawk”) in Black Hawk, Colorado, roughly 40 miles west of Denver. For extra data on Monarch, go to the Company’s web site at www.monarchcasino.com.
The Atlantis options roughly 61,000 sq. toes of on line casino house; 818 visitor rooms and suites; eight meals retailers; two connoisseur espresso and pastry bars; a 30,000 sq. foot well being spa and salon with an enclosed year-round pool; two shops providing clothes and conventional present store merchandise; an 8,000 square-foot household leisure heart; and roughly 52,000 sq. toes of banquet, conference and assembly room house. The on line casino options roughly 1,300 slot and video poker machines; roughly 37 desk video games, together with blackjack, craps, roulette, and others; a race and sports activities guide; a 24-hour reside keno lounge; and a poker site.
The Monarch Black Hawk options roughly 60,000 sq. toes of on line casino house; greater than 1,100 slot machines; roughly 40 desk video games; a reside poker site; a keno; and a sports activities guide. The resort additionally contains 10 bars and lounges, in addition to 4 eating choices: a twenty-four-hour full-service restaurant, a buffet-style restaurant, the Monarch Chophouse (a fine-dining steakhouse), and Bistro Mariposa (elevated Southwest delicacies). The resort gives 516 visitor rooms and suites, banquet and assembly room house, a retail retailer, a concierge lounge and an upscale spa and pool facility positioned on the highest ground of the tower. The resort is linked to a nine-story parking construction with roughly 1,350 parking areas, and extra valet parking, with complete property capability of roughly 1,500 areas.
Contacts:
John Farahi
Chief Executive Officer
775/824-4401 or [email protected]
Joseph Jaffoni, Richard Land, James Leahy
JCIR
212/835-8500 or [email protected]
– monetary tables observe –
MONARCH CASINO & RESORT, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
(In 1000’s, besides per share information; Unaudited)
| Three months ended June 30, |
Six months ended June 30, |
|||||||||||||||
| 2022 | 2021 | 2022 | 2021 | |||||||||||||
| Revenues | ||||||||||||||||
| Casino | $ | 63,865 | $ | 57,673 | $ | 126,696 | $ | 104,584 | ||||||||
| Food and beverage | 28,459 | 22,116 | 54,506 | 38,322 | ||||||||||||
| Hotel | 18,297 | 13,953 | 33,489 | 22,588 | ||||||||||||
| Other | 4,668 | 3,977 | 8,916 | 7,185 | ||||||||||||
| Net revenues | 115,289 | 97,719 | 223,607 | 172,679 | ||||||||||||
| Operating bills | ||||||||||||||||
| Casino | 23,315 | 18,304 | 45,682 | 31,922 | ||||||||||||
| Food and beverage | 21,901 | 17,505 | 42,632 | 31,600 | ||||||||||||
| Hotel | 6,293 | 5,389 | 12,066 | 9,640 | ||||||||||||
| Other | 2,247 | 1,992 | 4,329 | 3,512 | ||||||||||||
| Selling, basic and administrative | 23,097 | 20,607 | 47,280 | 40,532 | ||||||||||||
| Depreciation and amortization | 10,546 | 9,360 | 21,062 | 18,874 | ||||||||||||
| Other working objects, internet | 2,229 | 812 | 3,546 | 1,566 | ||||||||||||
| Total working bills | 89,628 | 73,969 | 176,597 | 137,646 | ||||||||||||
| Income from operations | 25,661 | 23,750 | 47,010 | 35,033 | ||||||||||||
| Interest expense | (700 | ) | (1,276 | ) | (1,350 | ) | (2,895 | ) | ||||||||
| Income earlier than earnings taxes | 24,961 | 22,474 | 45,660 | 32,138 | ||||||||||||
| Provision for earnings taxes | (5,526 | ) | (4,325 | ) | (8,107 | ) | (5,835 | ) | ||||||||
| Net earnings | $ | 19,435 | $ | 18,149 | $ | 37,553 | $ | 26,303 | ||||||||
| Earnings per share of frequent inventory | ||||||||||||||||
| Basic | $ | 1.02 | $ | 0.98 | $ | 1.98 | $ | 1.42 | ||||||||
| Diluted | $ | 0.99 | $ | 0.93 | $ | 1.92 | $ | 1.36 | ||||||||
| Weighted common variety of frequent shares and potential frequent shares excellent | ||||||||||||||||
| Basic | 18,987 | 18,595 | 18,928 | 18,538 | ||||||||||||
| Diluted | 19,582 | 19,465 | 19,586 | 19,381 | ||||||||||||
MONARCH CASINO & RESORT, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEET
(In 1000’s, besides per share information)
|
June 30, 2022 |
December 31, 2021 |
|||||||
| ASSETS | (unaudited) | |||||||
| Current property | ||||||||
| Cash and money equivalents | $ | 30,580 | $ | 33,526 | ||||
| Receivables, internet | 7,428 | 8,881 | ||||||
| Income taxes receivable | 28,269 | 26,946 | ||||||
| Inventories | 7,695 | 7,159 | ||||||
| Prepaid bills | 6,291 | 7,552 | ||||||
| Total present property | 80,263 | 84,064 | ||||||
| Property and tools, internet | 587,947 | 580,807 | ||||||
| Goodwill | 25,111 | 25,111 | ||||||
| Intangible property, internet | 414 | 477 | ||||||
| Total property | $ | 693,735 | $ | 690,459 | ||||
| LIABILITIES AND STOCKHOLDERS’ EQUITY | ||||||||
| Current liabilities | ||||||||
| Current maturities of long-term debt | $ | 20,000 | $ | 20,000 | ||||
| Accounts payable | 16,795 | 18,575 | ||||||
| Construction accounts payable | 50,222 | 58,891 | ||||||
| Accrued bills | 43,077 | 42,967 | ||||||
| Short-term lease legal responsibility | 604 | 745 | ||||||
| Total present liabilities | 130,698 | 141,178 | ||||||
| Deferred earnings taxes | 19,617 | 19,617 | ||||||
| Long-term lease legal responsibility | 13,247 | 13,498 | ||||||
| Long-term debt, internet | 43,837 | 68,152 | ||||||
| Total liabilities | 207,399 | 242,445 | ||||||
| Stockholders’ fairness | ||||||||
| Preferred inventory, $.01 par worth, 10,000,000 shares licensed; none issued | – | – | ||||||
| Common inventory, $.01 par worth, 30,000,000 shares licensed; | 191 | 191 | ||||||
| 19,096,300 shares issued; 18,888,070 excellent at June 30, 2022; | ||||||||
| 18,764,540 excellent at December 31, 2021 | ||||||||
| Additional paid-in capital | 45,802 | 41,426 | ||||||
| Treasury inventory, 208,230 shares at June 30, 2022; 331,760 shares at | (7,948 | ) | (4,341 | ) | ||||
| December 31, 2021 | ||||||||
| Retained earnings | 448,291 | 410,738 | ||||||
| Total stockholders’ fairness | 486,336 | 448,014 | ||||||
| Total liabilities and stockholders’ fairness | $ | 693,735 | $ | 690,459 | ||||
MONARCH CASINO & RESORT, INC. AND SUBSIDIARIES
RECONCILIATION OF ADJUSTED EBITDA TO NET INCOME
(In 1000’s, unaudited)
The following desk units forth a reconciliation of Adjusted EBITDA, a non-GAAP monetary measure, to internet earnings, a GAAP monetary measure:
| Three Months Ended June 30, |
Six Months Ended June 30, |
||||||||||||||
| 2022 | 2021 | 2022 | 2021 | ||||||||||||
| Adjusted EBITDA (1) | $ | 39,461 | $ | 35,169 | $ | 73,803 | $ | 58,000 | |||||||
| Expenses: | |||||||||||||||
| Stock primarily based compensation | (1,025 | ) | (1,247 | ) | (2,185 | ) | (2,527 | ) | |||||||
| Depreciation and amortization | (10,546 | ) | (9,360 | ) | (21,062 | ) | (18,874 | ) | |||||||
| Provision for earnings taxes | (5,526 | ) | (4,325 | ) | (8,107 | ) | (5,835 | ) | |||||||
| Interest expense | (700 | ) | (1,276 | ) | (1,350 | ) | (2,895 | ) | |||||||
| Pre-opening bills (2) | – | (1 | ) | – | (2 | ) | |||||||||
| Construction litigation bills (2) | (2,385 | ) | (824 | ) | (3,727 | ) | (1,469 | ) | |||||||
| COVID-19 bills (2) | – | – | – | (108 | ) | ||||||||||
| Litigation proceeds, internet (2) | 42 | – | 42 | – | |||||||||||
| Gain on disposition of property (2) | 114 | 13 | 139 | 13 | |||||||||||
| Net earnings | $ | 19,435 | $ | 18,149 | $ | 37,553 | $ | 26,303 | |||||||
- Adjusted EBITDA, a non-GAAP monetary measure, consists of internet earnings plus loss on disposal of property, provision for earnings taxes, stock-based compensation expense, different one-time fees, pre-opening bills, development litigation bills, acquisition bills, curiosity expense, depreciation and amortization much less curiosity earnings, any profit for earnings taxes and achieve on disposal of property. Adjusted EBITDA shouldn’t be construed as an alternative choice to working earnings (as decided in accordance with US Generally Accepted Accounting Principles), as an indicator of the Monarch’s working efficiency, as an alternative choice to money flows from working actions (as decided in accordance with US GAAP) or as a measure of liquidity. This measure allows comparability of the Monarch’s efficiency over a number of durations, in addition to in opposition to the efficiency of different firms in our business that report Adjusted EBITDA, though some firms don’t calculate this measure in the identical method and, due to this fact, the measure as offered will not be similar to equally titled measures offered by different firms. Monarch defines Adjusted EBITDA margin as Adjusted EBITDA divided by Net income.
- Amount included within the “Other operating items, net” on the Consolidated Statement of Income.
