MONARCH CASINO REPORTS 2012 FIRST QUARTER RESULTS
RENO, NV – April 18, 2012 - Monarch Casino & Resort, Inc. (NASDAQ: MCRI) (the "Company"), owner of the Atlantis Casino Resort Spa (the “Atlantis”) in Reno, Nevada, today announced first quarter results for the quarter ended March 31, 2012.
The Company’s net revenue of $34.6 million, was $1.3 million, or 3.9%, higher than the $33.3 million reported for the comparative quarter in 2011. The Company’s quarterly income from operations of $2.9 million was an increase of 7.4% over the prior year's first quarter. Adjusted EBITDA(1) of $6.6 million was $55 thousand, or 0.8%, higher than the $6.5 million Adjusted EBITDA in the first quarter of the prior year. First quarter 2012 revenue generated in the casino, food and beverage, and other operating departments increased by 8.4%, 4.9% and 12.5%, respectively, over the prior year’s first quarter. However, first quarter 2012 hotel revenue decreased by 12.7% primarily due to a significant convention that traditionally had been held in Reno not doing so in 2012. On a positive note, that convention has announced that it plans to return to Reno in the first quarter of 2013.
Casino operating expense increased by approximately $419 thousand, or 4.4%, over the prior year's first quarter primarily due to an increase in the amount of complimentary food, beverages and other services provided to casino patrons ("complimentaries"). As a percentage of casino revenue, casino operating expense decreased to 39.3% as compared to 40.8% in the prior year's first quarter, primarily due to the effect of the higher casino revenue partially offset by the higher complimentaries.
Food and beverage operating expense as a percentage of food and beverage revenue decreased to 44.6% for the quarter as compared to 46.5% in the first quarter of the prior year primarily due to menu price increases in response to higher commodity costs. Hotel operating expense as a percentage of hotel revenue increased slightly to 29.6% from 28.6% in prior year's first quarter. Selling, general, and administrative expense for the first quarter of 2012 increased by $853 thousand, or 7.8%, due primarily to increased marketing, payroll benefits and bad debt expense.
During the quarter, the Company paid down the balance outstanding under its credit facility by $5.7 million, which decreased the outstanding balance of the credit facility from $24.7 million at December 31, 2011 to $19.0 million at March 31, 2012. Interest expense increased from $289 thousand in the prior year's first quarter to $329 thousand in the quarter ended March 31, 2012 due primarily to higher loan commitment fees paid on the unborrowed portion of the Company’s credit facility.
Monarch’s CEO and Co-Chairman John Farahi commented: “The closing of our acquisition of the Riviera Black Hawk Casino remains on track to take place before the end of the second quarter of 2012.”
Monarch, through its subsidiary Monarch Growth Inc., has entered into a definitive stock purchase agreement to acquire Riviera Black Hawk, Inc., the owner of the Riviera Black Hawk Casino (the “Acquisition”). The Riviera Black Hawk Casino opened in 2000 and is located in Black Hawk, Colorado, approximately 40 miles west of Denver. The property is the first casino encountered by visitors arriving from Denver on Highway 119 and features approximately 32,000 square feet of casino space, 750 slot machines, 8 table games, a 250 seat buffet-style restaurant and a parking structure with approximately 500 spaces. Monarch owns a 1.5 acre land parcel contiguous to the Riviera Black Hawk Casino which can be utilized for future expansion.
Monarch Casino & Resort, Inc., through its subsidiary, Golden Road Motor Inn, Inc., owns and operates the Atlantis Casino Resort Spa, a hotel/casino facility in Reno, Nevada which features approximately 61,000 square feet of casino space; 824 guest rooms; eight food outlets; two espresso and pastry bars; a 30,000 square foot health spa and salon with an enclosed year-round pool; two retail outlets offering clothing and traditional gift shop merchandise; an 8,000 square-foot family entertainment center; and approximately 52,000 square feet of banquet, convention and meeting room space. The casino features approximately 1,450 slot and video poker machines; approximately 38 table games, including blackjack, craps, roulette, and others; a race and sports book; a 24-hour live keno lounge and a poker room. The Company and its predecessors have operated a facility on the Atlantis site since 1972.
This press release contains forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934 which are subject to change, including, but not limited to, comments relating to (i) future operating performance; (ii) economic and market conditions, (iii) the liquidity requirements of the Company, (iv) completion of the Acquisition, (v) plans, objectives and expectations regarding the Acquisition, and (vi) integration of the Acquisition. Actual results and future events and conditions may differ materially from those described in any forward-looking statements. Additional information concerning potential factors that could affect the Company’s financial results is included in the Company’s Securities and Exchange Commission filings, which are available on the Company's web site at www.monarchcasino.com.
(1) "Adjusted EBITDA" - see the separate Reconciliation of Net Income to Adjusted EBITDA. Adjusted EBITDA should not be construed as an alternative to operating income (as determined in accordance with generally accepted accounting principles) as an indicator of the Company's operating performance, as an alternative to cash flows from operating activities (as determined in accordance with generally accepted accounting principles) or as a measure of liquidity. This item enables comparison of the Company's performance with the performance of other companies that report Adjusted EBITDA, although some companies do not calculate this measure in the same manner and therefore, the measure as presented may not be comparable to similarly titled measures presented by other companies.
Lee Hernandez, Director of Planning & Analysis at (775) 335-4700 or LHernandez@MonarchCasino.com
Ron Rowan, CFO of Monarch at (775) 825-4700 or RRowan@MonarchCasino.com
John Farahi, CEO of Monarch at (775) 825-4700 or JFarahi@MonarchCasino.com
For additional information visit Monarch’s website at MonarchCasino.com