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Section 1: 8-K (8-K)

8-K

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

 

FORM 8-K

 

 

CURRENT REPORT

Pursuant to Section 13 or 15(d) of

The Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): August 2, 2018

 

 

Eldorado Resorts, Inc.

(Exact name of registrant as specified in its charter)

 

 

 

Nevada   001-36629   46-3657681

(State or other jurisdiction

of incorporation)

  (Commission File Number)  

(IRS Employer

Identification No.)

 

100 West Liberty Street, Suite 1150

Reno, NV

  89501
(Address of principal executive offices)   (Zip Code)

Registrant’s telephone number, including area code (775) 328-0100

Not Applicable

(Former name or former address, if changed since last report)

 

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

 

Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

 

Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

 

Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

 

Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter). Emerging growth company  ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.  ☐

 

 

 


Item 2.02.

Results of Operations and Financial Condition.

On August 2, 2018 Eldorado Resorts, Inc. issued a press release announcing its unaudited financial results for the three and six months ended June 30, 2018 and other information. A copy of the press release is attached hereto as Exhibit 99.1 and is incorporated herein by reference.

The information in this Current Report on Form 8-K and the Exhibit attached hereto shall not be deemed “filed” for purposes of Section 18 of the Securities Act of 1934, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, except as shall be expressly set forth by specific reference in such filing.

 

Item 9.01

Financial Statements and Exhibits.

(d) Exhibits:

 

Exhibit No.

  

Description

99.1    Earnings Press Release dated August 2, 2018


SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 

      ELDORADO RESORTS, INC.,
      a Nevada corporation
Date: August 2, 2018     By:   /s/ Gary L. Carano
      Name:   Gary L. Carano
      Title:   Chief Executive Officer
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Section 2: EX-99.1 (EX-99.1)

EX-99.1

Exhibit 99.1

 

LOGO

ELDORADO RESORTS REPORTS SECOND QUARTER NET REVENUE OF $456.8 MILLION,

OPERATING INCOME OF $77.4 MILLION AND RECORD ADJUSTED EBITDA OF $118.0 MILLION

Reno, Nev. (August 2, 2018) – Eldorado Resorts, Inc. (NASDAQ: ERI) (“Eldorado,” “ERI,” or “the Company”) today reported operating results for the second quarter ended June 30, 2018. Separately, Eldorado also announced that at a meeting earlier today, the Illinois Gaming Board approved the Company’s pending acquisition of the Grand Victoria Casino in Elgin, IL.

 

($ in thousands, except per share data)                  Total Net Revenue         
                 Three Months Ended         
                   June 30,         
     2018      2017      2017
Pre-Acquisition(1)
     2017
Total(2)
     Change  

West

   $ 117,880      $ 99,752      $ 11,001      $ 110,753        6.4

Midwest

     100,607        67,641        36,279        103,920        (3.2 )% 

South

     112,242        88,459        32,219        120,678        (7.0 )% 

East

     125,961        119,638        2,990        122,628        2.7

Corporate and Other

     112        136        45        181        (38.1 )% 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total Net Revenue (3)

   $ 456,802      $ 375,626      $ 82,534      $ 458,160        (0.3 )% 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

 

($ in thousands, except per share data)                Operating Income (Loss)        
               Three Months Ended        
                 June 30,        
     2018     2017     2017
Pre-Acquisition(1)
    2017
Total(2)
    Change  

West

   $ 21,865     $ 16,512     $ 2,709     $ 19,221       13.8

Midwest

     27,411       15,412       10,637       26,049       5.2

South

     20,564       12,610       5,739       18,349       12.1

East

     24,397       18,228       (197     18,031       35.3

Corporate and Other

     (16,823     (93,229     (2,550     (95,779     (82.4 )% 
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total Operating Income (Loss) (3)

   $ 77,414     $ (30,467   $ 16,338     $ (14,129     647.9
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

 

($ in thousands, except per share data)                Adjusted EBITDA        
               Three Months Ended        
                 June 30,        
     2018     2017     2017
Pre-Acquisition(1)
    2017
Total (2)
    Change  

West

   $ 31,758     $ 23,199     $ 3,640     $ 26,839       18.3

Midwest

     35,923       20,458       12,686       33,144       8.4

South

     28,402       18,466       7,299       25,765       10.2

East

     29,363       26,558       42       26,600       10.4

Corporate and Other

     (7,431     (5,884     (1,729     (7,613     (2.4 )% 
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total Adjusted EBITDA (4)

   $ 118,015     $ 82,797     $ 21,938     $ 104,735       12.7
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Net income (loss)

   $ 36,796     $ (46,190      
  

 

 

   

 

 

       

Basic EPS

   $ 0.48     $ (0.68      
  

 

 

   

 

 

       

Diluted EPS

   $ 0.47     $ (0.68      
  

 

 

   

 

 

       


                   Total Net Revenue  
($ in thousands, except per share data)                  Six Months Ended  
                   June 30,  
     2018      2017      2017
Pre-Acquisition(1)
     2017
Total (2)
     Change  

West

   $ 217,459      $ 163,240      $ 43,414      $ 206,654        5.2

Midwest

     201,402        67,641        142,237        209,878        (4.0 )% 

South

     235,042        121,019        131,100        252,119        (6.8 )% 

East

     242,852        225,926        11,717        237,643        2.2

Corporate and Other

     239        193        226        419        (43.0 )% 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total Net Revenue (3)

   $ 896,994      $ 578,019      $ 328,694      $ 906,713        (1.1 )% 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

 

                 Operating Income (Loss)  
($ in thousands, except per share data)                Six Months Ended  
                 June 30,  
     2018     2017     2017
Pre-Acquisition(1)
    2017
Total (2)
    Change  

West

   $ 32,004     $ 17,933     $ 9,525     $ 27,458       16.6

Midwest

     54,087       15,412       34,819       50,231       7.7

South

     33,923       18,528       25,086       43,614       (22.2 )% 

East

     43,528       33,196       (1,072     32,124       35.5

Corporate and Other

     (31,934     (101,508     (8,811     (110,319     (71.1 )% 
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total Operating Income (Loss) (3)

   $ 131,608     $ (16,439   $ 59,547     $ 43,108       205.3
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

 

                 Adjusted EBITDA  
($ in thousands, except per share data)                Six Months Ended  
                 June 30,  
     2018     2017     2017
Pre-Acquisition(1)
    2017
Total (2)
    Change  

West

   $ 50,182     $ 29,423     $ 13,231     $ 42,654       17.6

Midwest

     70,438       20,458       46,856       67,314       4.6

South

     60,619       26,316       30,998       57,314       5.8

East

     55,543       50,562       (120     50,442       10.1

Corporate and Other

     (15,223     (10,678     (5,996     (16,674     (8.7 )% 
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total Adjusted EBITDA (4)

   $ 221,559     $ 116,081     $ 84,969     $ 201,050       10.2
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Net income (loss)

   $ 57,651     $ (45,245      
  

 

 

   

 

 

       

Basic EPS

   $ 0.74     $ (0.79      
  

 

 

   

 

 

       

Diluted EPS

   $ 0.74     $ (0.79      
  

 

 

   

 

 

       

 

1.

Figures are for Isle of Capri Casinos, Inc. (“Isle”) for the one and four months ended April 30, 2017. Such figures were prepared by the Company to reflect Isle’s unaudited consolidated historical net revenues, operating income and Adjusted EBITDA for periods corresponding to ERI’s fiscal quarterly calendar. Such figures are based on the unaudited internal financial statements and have not been reviewed by the Company’s auditors and do not conform to GAAP.

2.

Total figures for 2017 include combined results of operations for Isle and ERI for periods preceding the date that ERI acquired Isle. Such presentation does not conform with GAAP or the Securities and Exchange Commission rules for pro forma presentation; however, we believe that the additional financial information will be helpful to investors in comparing current results with results of prior periods. This is non-GAAP data and should not be considered a substitute for data prepared in accordance with GAAP, but should be viewed in addition to the results of operations reported by the Company.

3.

The prior period presentation has been adjusted for the adoption of Accounting Standards Codification (ASC) No. 606 “Revenue from Contracts with Customers” effective January 1, 2018 utilizing the full retrospective transition method. See reconciliation table on the last page of this release for further details.

4.

Adjusted EBITDA is not a GAAP measurement and is presented solely as a supplemental disclosure because the Company believes it is a widely used measure of operating performance in the gaming industry. See “Reconciliation of GAAP Measures to Non-GAAP Measures” below for a definition of Adjusted EBITDA and a quantitative reconciliation of Adjusted EBITDA to operating income (loss), which the Company believes is the most comparable financial measure calculated in accordance with GAAP.


“In the second quarter, Adjusted EBITDA rose at 16 of our 20 properties as all four of our property reporting segments generated year-over-year gains including double digit Adjusted EBITDA growth in our East, West and South segments,” said Gary Carano, Chairman and Chief Executive Officer of Eldorado. “On a consolidated basis, second quarter Adjusted EBITDA rose 12.7% to $118.0 million, as our property level Adjusted EBITDA margin rose 290 basis points to 27.5% and our consolidated Adjusted EBITDA margin increased 300 basis points to 25.8%.

“Our strong margin growth, including property level and consolidated Adjusted EBITDA margin growth in every quarter since our May 2017 acquisition of Isle of Capri, reflects the benefit of our focus on disciplined marketing and promotion, advertising, food and beverage and labor expense management. Our record results also reflect success in driving better customer experiences across our property portfolio through an emphasis on market-leading guest services and targeted return-focused property enhancement projects. With the bulk of our planned major capital investments and enhancements complete in Reno, our recent rebranding of the three-property operations across six contiguous city blocks as ‘THE ROW’ has been met with an enthusiastic response from our guests. THE ROW leverages our integrated design and property enhancements and amplifies the convenience, amenities, entertainment and quality of Eldorado Resort Casino, Silver Legacy Resort Casino Reno and Circus Circus Reno. Our recent investments in the Reno market have resulted in revenue improvements with growth in high margin, non-gaming revenue channels. This fall THE ROW will open the The Spa at Silver Legacy, a 21,000 square foot spa that will offer our guests the largest relaxation, beauty, fitness and retail treatment facility in northern Nevada.

“Additional projects scheduled to be completed over the balance of this year include the renovation of approximately 400 rooms at Silver Legacy and the opening of Brew Brothers restaurants at Isle Casino Waterloo and Isle of Capri Casino Boonville. Following the opening of the two new Brew Brothers locations, the successful microbrew concept will be featured at five of our properties. In addition, renovations to all 402 rooms at our Black Hawk properties will begin at the end of the year and are expected to be completed in the first quarter of 2019.

“We are pleased with our 2018 results to date and expect that the Grand Victoria Casino and pending Tropicana Entertainment acquisitions, combined with the strong operations of our existing properties, will position us for additional growth in the future as we continue to pursue opportunities to create additional value for shareholders.”

Balance Sheet and Liquidity

At June 30, 2018, Eldorado had $202.0 million in cash and cash equivalents excluding restricted cash. Outstanding indebtedness at June 30, 2018 totaled $2.2 billion, with no amounts outstanding on the Company’s revolving credit facility. Capital expenditures in the second quarter and first six months of 2018 totaled $33.9 million and $55.2 million, respectively.

Summary of 2018 Second Quarter Region Results

The property results for Presque Isle Downs and Casino and Lady Luck Nemacolin are included in operations until the announced transactions for the divestitures of these properties are completed which is expected to be in the 2018 fourth quarter.

West Region (THE ROW, Isle Casino Hotel Black Hawk and Lady Luck Casino Black Hawk)

Net revenue for the West Region properties for the quarter ended June 30, 2018 increased approximately 6.4% to $117.9 million compared to $110.8 million in the prior-year period, while operating income rose to $21.9 million from $19.2 million in the year-ago quarter. Adjusted EBITDA increased 18.3% to $31.8 million reflecting an Adjusted EBITDA margin improvement of 270 basis points


to 26.9%, compared to Adjusted EBITDA of $26.8 million on an Adjusted EBITDA margin of 24.2% in the prior-year period. Adjusted EBITDA increased year over year at THE ROW and for the combined operations in Black Hawk, with the combined Adjusted EBITDA margin for the Black Hawk properties exceeding 30% for the fourth consecutive quarter.

Midwest Region (Isle Casino Waterloo, Isle Casino Bettendorf, Isle of Capri Casino Boonville, Isle Casino Cape Girardeau, Lady Luck Casino Caruthersville and Isle of Capri Casino Kansas City)

Net revenue for the Midwest Region properties for the quarter ended June 30, 2018 decreased approximately 3.2% to $100.6 million compared to $103.9 million in the prior-year period, while operating income rose to $27.4 million from $26.0 million in the year-ago quarter. Adjusted EBITDA rose approximately 8.4% to $35.9 million as the Adjusted EBITDA margin for the segment rose 380 basis points to 35.7%. Adjusted EBITDA for the Midwest Region in the prior-year period was $33.1 million reflecting an Adjusted EBITDA margin of 31.9%.

South Region (Isle Casino Racing Pompano Park, Eldorado Shreveport, Isle of Capri Casino Lula, Lady Luck Casino Vicksburg and Isle of Capri Lake Charles)

Net revenue for the South Region properties for the quarter ended June 30, 2018 declined approximately 7.0% to $112.2 million compared to $120.7 million in the prior-year period, while operating income increased to $20.6 million from $18.3 million in the year-ago quarter. Adjusted EBITDA increased 10.2% to $28.4 million as the Adjusted EBITDA margin for the segment rose 400 basis points to 25.3%. Adjusted EBITDA for the South Region in the prior-year period was $25.8 million reflecting an Adjusted EBITDA margin of 21.4%. Adjusted EBITDA increased year over year at four of the five South Region properties including Isle of Capri Lake Charles which saw an Adjusted EBITDA increase of more than 23% as the Company continues to execute on opportunities for significant improvement following the termination of the sale agreement for the property in the 2017 fourth quarter. Isle Casino Racing Pompano Park and Isle of Capri Casino Lula also both generated double digit Adjusted EBITDA growth in the current quarter.

East Region (Presque Isle Downs and Casino, Lady Luck Casino Nemacolin, Eldorado Scioto Downs Racino and Mountaineer Casino, Racetrack and Resort)

Net revenue for the East Region properties for the quarter ended June 30, 2018 increased approximately 2.7% to $126.0 million compared to $122.6 million in the prior-year period, while operating income grew to $24.4 million from $18.0 million in the year-ago quarter. Adjusted EBITDA for the East Region rose 10.4% to $29.4 million compared to Adjusted EBITDA of $26.6 million in the prior-year period as the East Region’s Adjusted EBITDA margin improved 160 basis points to 23.3%. Eldorado Scioto Downs generated Adjusted EBITDA growth for the fourteenth consecutive quarter.

Reconciliation of GAAP Measures to Non-GAAP Measures

Adjusted EBITDA (defined below), a non-GAAP financial measure, has been presented as a supplemental disclosure because it is a widely used measure of performance and basis for valuation of companies in our industry and we believe that this non-GAAP supplemental information will be helpful in understanding the Company’s ongoing operating results. Management has historically used Adjusted EBITDA when evaluating operating performance because we believe that the inclusion or exclusion of certain recurring and non-recurring items is necessary to provide a full understanding of our core operating results and as a means to evaluate period-to-period results. Adjusted EBITDA represents operating income (loss) before depreciation and amortization, stock-based compensation, transaction expenses, severance expense, costs associated with the Presque Isle Downs, Vicksburg and Lake Charles sales, impairment charges, equity in income of unconsolidated affiliates, (gain) loss on the sale or disposal of property and equipment, and other non-cash regulatory gaming assessments. Adjusted


EBITDA is not a measure of performance or liquidity calculated in accordance with accounting principles generally accepted in the United States (“US GAAP”), is unaudited and should not be considered an alternative to, or more meaningful than, net income (loss) as an indicator of our operating performance. Uses of cash flows that are not reflected in Adjusted EBITDA include capital expenditures, interest payments, income taxes, debt principal repayments and certain regulatory gaming assessments, which can be significant. As a result, Adjusted EBITDA should not be considered as a measure of our liquidity. Other companies that provide EBITDA information may calculate EBITDA differently than we do. The definition of Adjusted EBITDA may not be the same as the definitions used in any of our debt agreements.

Second Quarter Conference Call

Eldorado will host a conference call at 4:30 p.m. ET today. Senior management will discuss the financial results and host a question and answer session. The dial in number for the audio conference call is 719/325-4778, conference ID 6220773 (domestic and international callers). Participants can also access a live webcast of the call through the “Events & Presentations” section of Eldorado’s website at http://www.eldoradoresorts.com/ and a replay of the webcast will be archived on the site for 90 days following the live event.

About Eldorado Resorts, Inc.

Eldorado Resorts is a leading casino entertainment company that owns and operates twenty properties in ten states, including Colorado, Florida, Iowa, Louisiana, Mississippi, Missouri, Nevada, Ohio, Pennsylvania and West Virginia. In aggregate, Eldorado’s properties feature approximately 21,000 slot machines and VLTs and 600 table games, and over 7,000 hotel rooms. On April 16, 2018, the Company announced that it entered into acquisition agreements for Tropicana Entertainment Inc. and the Grand Victoria Casino in Elgin, IL. The Grand Victoria Casino transaction is expected to close in the 2018 third quarter and the Tropicana Entertainment Inc. transaction is expected to close in the fourth quarter. For more information, please visit www.eldoradoresorts.com.

Forward-Looking Statements

This press release includes “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements include statements regarding our strategies, objectives and plans for future development or acquisitions of properties or operations, as well as expectations, future operating results and other information that is not historical information. When used in this press release, the terms or phrases such as “anticipates,” “believes,” “projects,” “plans,” “intends,” “expects,” “might,” “may,” “estimates,” “could,” “should,” “would,” “will likely continue,” and variations of such words or similar expressions are intended to identify forward-looking statements. Although our expectations, beliefs and projections are expressed in good faith and with what we believe is a reasonable basis, there can be no assurance that these expectations, beliefs and projections will be realized. There are a number of risks and uncertainties that could cause our actual results to differ materially from those expressed in the forward-looking statements which are included elsewhere in this press release. Such risks, uncertainties and other important factors include, but are not limited to: our ability to obtain required regulatory approvals (including approval from gaming regulators and expiration of the waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976) and satisfy or waive other closing conditions to consummate the acquisition of Tropicana and the Grand Victoria Casino and the disposition of Presque Isle Downs and Lady Luck Casino Nemacolin on a timely basis; the possibility that the one or more of such transactions do not close on the terms described herein or that we are required to modify aspects of one or more of such transactions to obtain regulatory approval; our ability to promptly and effectively implement our operating strategies at the acquired properties and integrate our business and the business of the acquired companies to realize the synergies contemplated by the proposed acquisitions;


our ability to obtain debt financing on the terms expected, or at all; the possibility that the business of Tropicana or the Grand Victoria Casino may suffer as a result of the announcement of the acquisition; our ability to retain key employees of the acquired companies; the outcome of legal proceedings that may be instituted as a result of the proposed transactions; our substantial indebtedness and the impact of such obligations on our operations and liquidity; competition; sensitivity of our operations to reductions in discretionary consumer spending and changes in general economic and market conditions; governmental regulations and increases in gaming taxes and fees in jurisdictions in which we operate; and other risks and uncertainties described in our reports on Form 10-K, Form 10-Q and Form 8-K.

In light of these and other risks, uncertainties and assumptions, the forward-looking events discussed in this press release might not occur. These forward-looking statements speak only as of the date of this press release, even if subsequently made available on our website or otherwise, and we do not intend to update publicly any forward-looking statement to reflect events or circumstances that occur after the date on which the statement is made, except as may be required by law.

Contact:

 

Thomas Reeg    Joseph N. Jaffoni, James Leahy
President and Chief Financial Officer    JCIR
Eldorado Resorts, Inc.    212/835-8500
775/328-0112    eri@jcir.com
investorrelations@eldoradoresorts.com   

- tables follow -


ELDORADO RESORTS, INC.

CONSOLIDATED STATEMENTS OF OPERATIONS

($ in thousands, except per share data)

(unaudited)

 

     Three Months Ended     Six Months Ended  
     June 30,     June 30,  
     2018     2017 (1)     2018     2017 (1)  

REVENUES:

        

Casino

   $ 343,675     $ 275,593     $ 683,133     $ 417,147  

Pari-mutuel commissions

     5,045       4,112       9,115       4,748  

Food and beverage

     54,293       49,709       106,491       82,130  

Hotel

     38,926       34,278       69,667       53,583  

Other

     14,863       11,934       28,588       20,411  
  

 

 

   

 

 

   

 

 

   

 

 

 

Net revenues

     456,802       375,626       896,994       578,019  
  

 

 

   

 

 

   

 

 

   

 

 

 

EXPENSES:

        

Casino

     165,353       139,707       331,203       219,688  

Pari-mutuel commissions

     4,592       4,030       8,293       5,237  

Food and beverage

     44,770       42,803       89,546       68,821  

Hotel

     13,695       12,270       26,201       21,349  

Other

     8,310       6,901       15,715       13,070  

Marketing and promotions

     21,832       21,531       43,133       31,660  

General and administrative

     73,745       60,887       147,947       92,687  

Corporate

     12,232       7,442       23,801       14,016  

Impairment charges

     —         —         9,815       —    

Depreciation and amortization

     31,910       24,909       63,444       40,513  
  

 

 

   

 

 

   

 

 

   

 

 

 

Total operating expenses

     376,439       320,480       759,098       507,041  

Gain (loss) on sale or disposal of property and equipment

     423       (89     (283     (57

Transaction expenses

     (3,404     (85,464     (5,952     (87,078

Equity in gain (loss) of unconsolidated affiliates

     32       (60     (53     (282
  

 

 

   

 

 

   

 

 

   

 

 

 

Operating income (loss)

     77,414       (30,467     131,608       (16,439
  

 

 

   

 

 

   

 

 

   

 

 

 

OTHER INCOME (EXPENSE):

        

Interest expense, net

     (31,405     (27,527     (62,494     (40,197

Loss on early retirement of debt, net

     —         (27,317     (162     (27,317
  

 

 

   

 

 

   

 

 

   

 

 

 

Total other expense

     (31,405     (54,844     (62,656     (67,514
  

 

 

   

 

 

   

 

 

   

 

 

 

Net income (loss) before income taxes

     46,009       (85,311     68,952       (83,953

(Provision) benefit for income taxes

     (9,213     39,121       (11,301     38,708  
  

 

 

   

 

 

   

 

 

   

 

 

 

Net income (loss)

   $ 36,796     $ (46,190   $ 57,651     $ (45,245
  

 

 

   

 

 

   

 

 

   

 

 

 

Net income (loss) per share of common stock:

        

Basic

   $ 0.48     $ (0.68   $ 0.74     $ (0.79
  

 

 

   

 

 

   

 

 

   

 

 

 

Diluted

   $ 0.47     $ (0.68   $ 0.74     $ (0.79
  

 

 

   

 

 

   

 

 

   

 

 

 

Weighted average basic shares outstanding

     77,458,584       67,453,095       77,406,447       57,405,834  
  

 

 

   

 

 

   

 

 

   

 

 

 

Weighted average diluted shares outstanding

     78,258,629       67,453,095       78,169,629       57,405,834  
  

 

 

   

 

 

   

 

 

   

 

 

 

 

1.

The prior period presentation has been adjusted for the adoption of Accounting Standards Codification (ASC) No. 606 “Revenue from Contracts with Customers” effective January 1, 2018 utilizing the full retrospective transition method. See reconciliation table on the last page of this release for further details.


ELDORADO RESORTS, INC.

SUMMARY INFORMATION AND RECONCILIATION OF

OPERATING INCOME (LOSS) TO ADJUSTED EBITDA

($ in thousands)

(unaudited)

 

     Three Months Ended June 30, 2018  
     Operating
Income
(Loss)
    Depreciation
and
Amortization
     Stock-Based
Compensation
    Transaction
Expenses
(3)
     Other
(4)
    Adjusted
EBITDA
 

West

   $ 21,865     $ 9,382      $ (95   $ —        $ 606     $ 31,758  

Midwest

     27,411       8,404        31       —          77       35,923  

South

     20,564       8,108        17       —          (287     28,402  

East

     24,397       4,717        3       —          246       29,363  

Corporate and Other

     (16,823     1,299        3,516       3,404        1,173       (7,431
  

 

 

   

 

 

    

 

 

   

 

 

    

 

 

   

 

 

 

Total

   $ 77,414     $ 31,910      $ 3,472     $ 3,404      $ 1,815     $ 118,015  
  

 

 

   

 

 

    

 

 

   

 

 

    

 

 

   

 

 

 

 

     Three Months Ended June 30, 2017 (6)  
     Operating
Income
(Loss)
    Depreciation
and
Amortization
     Stock-Based
Compensation
     Transaction
Expenses
(3)
     Other
(4)
    Adjusted
EBITDA
 

Excluding Pre-Acquisition:

               

West

   $ 16,512     $ 6,571      $ 52      $ —        $ 64     $ 23,199  

Midwest

     15,412       4,966        86        —          (6     20,458  

South

     12,610       4,662        64        —          1,130       18,466  

East

     18,228       8,273        4        —          53       26,558  

Corporate and Other

     (93,229     437        1,123        85,464        321       (5,884
  

 

 

   

 

 

    

 

 

    

 

 

    

 

 

   

 

 

 

Total Excluding Pre-Acquisition

   $ (30,467   $ 24,909      $ 1,329      $ 85,464      $ 1,562     $ 82,797  
  

 

 

   

 

 

    

 

 

    

 

 

    

 

 

   

 

 

 

Pre-Acquisition (1):

               

West

   $ 2,709     $ 925      $ 2      $ —        $ 4     $ 3,640  

Midwest

     10,637       2,001        14        —          34       12,686  

South

     5,739       1,441        9        —          110       7,299  

East

     (197     239        —          —          —         42  

Corporate and Other

     (2,550     96        461        286        (22     (1,729
  

 

 

   

 

 

    

 

 

    

 

 

    

 

 

   

 

 

 

Total Pre-Acquisition

   $ 16,338     $ 4,702      $ 486      $ 286      $ 126     $ 21,938  
  

 

 

   

 

 

    

 

 

    

 

 

    

 

 

   

 

 

 

Including Pre-Acquisition:

               

West

   $ 19,221     $ 7,496      $ 54      $ —        $ 68     $ 26,839  

Midwest

     26,049       6,967        100        —          28       33,144  

South

     18,349       6,103        73        —          1,240       25,765  

East

     18,031       8,512        4        —          53       26,600  

Corporate and Other

     (95,779     533        1,584        85,750        299       (7,613
  

 

 

   

 

 

    

 

 

    

 

 

    

 

 

   

 

 

 

Total Including Pre-Acquisition (2)

   $ (14,129   $ 29,611      $ 1,815      $ 85,750      $ 1,688     $ 104,735  
  

 

 

   

 

 

    

 

 

    

 

 

    

 

 

   

 

 

 

 

     Six Months Ended June 30, 2018  
     Operating
Income
(Loss)
    Depreciation
and
Amortization
     Stock-Based
Compensation
    Transaction
Expenses
(3)
     Other (4)      Adjusted
EBITDA
 

West

   $ 32,004     $ 17,571      $ (32   $ —        $ 639      $ 50,182  

Midwest

     54,087       16,049        75       —          227        70,438  

South

     33,923       16,639        42       —          10,015        60,619  

East

     43,528       10,766        8       —          1,241        55,543  

Corporate and Other

     (31,934     2,419        7,058       5,952        1,282        (15,223
  

 

 

   

 

 

    

 

 

   

 

 

    

 

 

    

 

 

 

Total

   $ 131,608     $ 63,444      $ 7,151     $ 5,952      $ 13,404      $ 221,559  
  

 

 

   

 

 

    

 

 

   

 

 

    

 

 

    

 

 

 


     Six Months Ended June 30, 2017 (6)  
     Operating
Income
(Loss)
    Depreciation
and
Amortization
     Stock-Based
Compensation
     Transaction
Expenses
(3)
     Other
(4)
    Adjusted
EBITDA
 

Excluding Pre-Acquisition:

               

West

   $ 17,933     $ 11,214      $ 52      $ —        $ 224     $ 29,423  

Midwest

     15,412       4,966        86        —          (6     20,458  

South

     18,528       6,594        64        —          1,130       26,316  

East

     33,196       17,153        4        —          209       50,562  

Corporate and Other

     (101,508     586        2,856        87,078        310       (10,678
  

 

 

   

 

 

    

 

 

    

 

 

    

 

 

   

 

 

 

Total Excluding Pre-Acquisition

   $ (16,439   $ 40,513      $ 3,062      $ 87,078      $ 1,867     $ 116,081  
  

 

 

   

 

 

    

 

 

    

 

 

    

 

 

   

 

 

 

Pre-Acquisition (5):

               

West

   $ 9,525     $ 3,694      $ 8      $ —        $ 4     $ 13,231  

Midwest

     34,819       11,952        51        —          34       46,856  

South

     25,086       5,693        35        —          184       30,998  

East

     (1,072     952        —          —          —         (120

Corporate and Other

     (8,811     371        1,631        286        527       (5,996
  

 

 

   

 

 

    

 

 

    

 

 

    

 

 

   

 

 

 

Total Pre-Acquisition

   $ 59,547     $ 22,662      $ 1,725      $ 286      $ 749     $ 84,969  
  

 

 

   

 

 

    

 

 

    

 

 

    

 

 

   

 

 

 

Including Pre-Acquisition:

               

West

   $ 27,458     $ 14,908      $ 60      $ —        $ 228     $ 42,654  

Midwest

     50,231       16,918        137        —          28       67,314  

South

     43,614       12,287        99        —          1,314       57,314  

East

     32,124       18,105        4        —          209       50,442  

Corporate and Other

     (110,319     957        4,487        87,364        837       (16,674
  

 

 

   

 

 

    

 

 

    

 

 

    

 

 

   

 

 

 

Total Including Pre-Acquisition (2)

   $ 43,108     $ 63,175      $ 4,787      $ 87,364      $ 2,616     $ 201,050  
  

 

 

   

 

 

    

 

 

    

 

 

    

 

 

   

 

 

 

 

1.

Figures are for Isle for April 2017. Such figures were prepared by the Company to reflect Isle’s unaudited consolidated historical operating revenues, operating income and Adjusted EBITDA for periods corresponding to the Company’s fiscal quarterly calendar. Such figures are based on the unaudited internal financial statements and have not been reviewed by the Company’s auditors and do not conform to GAAP.

2.

Total figures for 2017 include combined results of operations for Isle and the Company for periods preceding the date that the Company acquired Isle. Such presentation does not conform with GAAP or the Securities and Exchange Commission rules for proforma presentation; however, we believe that the additional financial information will be helpful to investors in comparing current results with results of prior periods. This is non-GAAP data and should not be considered a substitute for data prepared in accordance with GAAP, but should be viewed in addition to the results of operations reported by the Company.

3.

Transaction expenses represent costs related to the acquisition of Isle for the three and six months ended June 30, 2017 and costs primarily related to the acquisitions of Grand Victoria Casino and Tropicana Entertainment Inc. for the three and six months ended June 30, 2018.

4.

Other is comprised of severance expense, (gain) loss on the sale or disposal of property and equipment, equity in income (loss) of unconsolidated affiliate and other non-cash regulatory gaming assessments for the three and six months ended June 30, 2018 and 2017. Also included are costs associated with the sales of Vicksburg and Presque Isle Downs for the three and six months ended June 30, 2018 and the failed sale of Lake Charles for the three and six months ended June 30, 2017. In conjunction with the announced sale of Vicksburg, an impairment charge totaling $9.8 million was recorded for the six months ended June 30, 2018.

5.

Figures are for Isle for the four months ended April 30, 2017. Such figures were prepared by the Company to reflect Isle’s unaudited consolidated historical operating revenues, operating income and Adjusted EBITDA for periods corresponding to the Company’s fiscal quarterly calendar. Such figures are based on the unaudited internal financial statements and have not been reviewed by the Company’s auditors and do not conform to GAAP.

6.

The prior period presentation has been adjusted for the adoption of Accounting Standards Codification (ASC) No. 606 “Revenue from Contracts with Customers” effective January 1, 2018 utilizing the full retrospective transition method. See Note 2 to our Condensed Notes to Unaudited Consolidated Financial Statements for additional information.

 

          

Reconciliation Table

Three Months Ended June 30, 2017

 
     As
Reported
    ASC 606
Adjustments
    Other
Reclassifications (1)
     As
Adjusted
 

Gross revenues

   $ 389,237     $ (31,215   $ 17,604      $ 375,626  

Promotional allowances

     (34,057     33,226       831        —    
  

 

 

   

 

 

   

 

 

    

 

 

 

Net revenues

   $ 355,180     $ 2,011     $ 18,435      $ 375,626  
  

 

 

   

 

 

   

 

 

    

 

 

 

Operating (loss) income

     (32,116     110       1,539        (30,467

Net (loss) income

     (46,328     138       —          (46,190


    

Reconciliation Table

Six Months Ended June 30, 2017

 
     As
Reported
    ASC 606
Adjustments
    Other
Reclassifications (1)
     As
Adjusted
 

Gross revenues

   $ 608,783     $ (48,235   $ 17,471      $ 578,019  

Promotional allowances

     (52,678     51,713       965        —    
  

 

 

   

 

 

   

 

 

    

 

 

 

Net revenues

   $ 556,105     $ 3,478     $ 18,436      $ 578,019  
  

 

 

   

 

 

   

 

 

    

 

 

 

Operating (loss) income

     (17,967     (11     1,539        (16,439

Net (loss) income

     (45,307     62       —          (45,245

 

1.

Other reclassifications are comprised of the reversal of our Lake Charles property from discontinued operations and other reclassifications to conform to current period presentations.

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