LAS VEGAS--(BUSINESS WIRE)--
Golden Entertainment, Inc. (
GDEN) (“Golden Entertainment” or the “Company”) today announced financial results for the quarter ended June 30, 2016. On July 31, 2015, Sartini Gaming, Inc. (“Sartini Gaming”) merged with a subsidiary of Lakes Entertainment (the “Merger”) and the Company was renamed Golden Entertainment. The Company’s financial results prior to July 31, 2015 do not include the operations of Sartini Gaming.
Key Highlights and Recent Developments
- Net revenues for the quarter were $102.6 million, compared to $15.3 million in the prior year quarter, with the increase due primarily to the Merger and results from the Company’s newly acquired distributed gaming operations in the state of Montana. Net revenues for the current quarter increased 16.5% compared to the Combined Net Revenues of the Company and Sartini Gaming of $88.0 million in the prior year quarter.
- Net income for the quarter was $2.8 million, or $0.12 per diluted share, compared to a net loss of $0.2 million, or $0.01 per diluted share, in the prior year quarter.
- Adjusted EBITDA for the quarter was $13.3 million, compared to $1.7 million in the prior year quarter, with the increase due primarily to the Merger, Montana distributed gaming and the opening of new taverns in Las Vegas. Adjusted EBITDA for the current quarter increased 12.2% compared to the Combined Adjusted EBITDA of the Company and Sartini Gaming of $11.9 million in the prior year quarter.
- Net revenues for the quarter from the Distributed Gaming segment were $77.8 million, compared to $63.1 million of Combined Net Revenues for this segment in the same quarter a year ago, an increase of 23.2%.
- The Company completed two separate acquisitions of assets of distributed gaming operators in Montana in January and April 2016 for approximately $45.8 million in the aggregate, which added approximately 2,900 gaming devices, nearly 1,100 amusement devices and over 100 ATMs, along with certain other non-gaming assets and the right to operate within certain locations to the Company’s Distributed Gaming segment.
- On July 14, 2016, the Company paid a special cash dividend of an aggregate of $23.5 million to eligible shareholders of record.
“By all measures we made significant progress during the second quarter. Our net revenues and Adjusted EBITDA were up 16.5% and 12.2%, respectively, driven by a combination of organic and external growth,” said Blake L. Sartini, Chief Executive Officer of Golden Entertainment. “We saw same-store tavern revenues up 9.3%, we increased our Casino segment Adjusted EBITDA margins significantly by nearly 560 basis points, our acquisitions in Montana began to contribute meaningfully to results, and we paid a $1.71 per share special dividend to eligible shareholders.”
Added Sartini, “During the quarter our distributed gaming net revenues increased 23.2% compared to the combined net revenues from the prior year quarter, and we continue to see real potential for growth. We now operate 51 tavern locations in Las Vegas, and we have added to the mix our position as a leading distributed gaming provider in the state of Montana. We also completed the first phase of upgrades and renovations to our Rocky Gap property and are beginning to see benefits. We are proud of our progress and view these achievements as collectively advancing our strategy to expand our core markets by scaling our leadership position in distributed gaming and taking advantage of organic growth opportunities in our casino portfolio.”
Unaudited Consolidated and Combined Results
Given the Merger, the following illustrates for each segment net revenues, net income (loss) and Adjusted EBITDA for the three months and six months ended June 30, 2016, and Combined Net Revenues, Combined Net Income (Loss) and Combined Adjusted EBITDA for the Company and Sartini Gaming for the three months and six months ended June 28, 2015. These combined financial results have been prepared for illustrative purposes only and do not purport to be indicative of the results that actually would have resulted had the Merger occurred on the first day of such period, or of the future results of the Company. The combined results do not reflect any operating efficiencies and associated cost savings that may be achieved as a result of the Merger.