Pinnacle Entertainment, Inc. (NYSE:PNK) today reported financial
results for the third quarter ended September 30, 2012.
2012 Third Quarter Financial Highlights:
- Revenues increased $8.3 million or 2.8% year over year to
$304.2 million.
- Consolidated Adjusted EBITDA(1) increased $5.5 million or 8.0%
year over year to $74.1 million, driven by record L'Auberge Lake
Charles results, strong St. Louis performance and the opening of
L'Auberge Baton Rouge.
- Management estimates the impact from Hurricane Isaac negatively
affected Adjusted EBITDA(2) of the Company's Louisiana operating
properties by $1.6 million in the 2012 third quarter. In addition,
2012 third quarter Consolidated Adjusted EBITDA included $0.7
million of severance and relocation charges. Adjusting for these
factors, Consolidated Adjusted EBITDA for the 2012 third quarter
would have been $76.4 million.
- Income from continuing operations decreased to $6.8 million
versus $11.8 million in the prior year period, principally as a
result of increased pre-opening expenses related to the opening of
L'Auberge Baton Rouge.
- Adjusted income per share(1), which normalizes for the effect
of pre-opening expenses and other non-recurring items, increased
$0.05 or 20% year over year to $0.30; GAAP net (loss) per share was
$(0.01) in the 2012 third quarter and in the prior year
period.
Additional Highlights:
- Through October 23, 2012, the Company has repurchased 3.5
million shares of its common stock for $40 million under its $100
million share repurchase program, representing a 5.5% reduction in
its diluted share count from the inception of the program in July
2012.
- L'Auberge Baton Rouge opened on September 1, 2012 and
contributed revenue of $13.1 million and Adjusted EBITDA of $1.5
million to 2012 third quarter operating results.
- The Company is progressing toward an agreement to dispose of
its land holdings in Atlantic City and expects to enter into a
definitive agreement by year end. Separately, the Company expects
to receive approximately $2.6 million from the New Jersey Casino
Reinvestment Development Authority for the redemption of bond
credits. In the 2012 third quarter, the Company recorded a non-cash
impairment charge of $6.9 million related to its Atlantic City
assets, which is included in Discontinued Operations.
- On September 5, 2012, the Company was refunded its $25 million
completion guarantee deposit by the Louisiana Gaming Control Board
upon the L'Auberge Baton Rouge opening.
- In August 2012, the Company entered into a Subscription
Agreement and Amended and Restated Shareholders Agreement related
to its investment in ACDL. The agreement provides that the Company
invests $15.6 million in convertible preferred stock of ACDL or its
pro-rata 26% share of a previously disclosed total capital raise by
ACDL of $60 million.
- On July 2, 2012 the Company closed the acquisition of Heartland
Poker Tour.
In the 2012 third quarter, revenues increased 2.8% or $8.3
million year over year to $304.2 million. Consolidated Adjusted
EBITDA increased $5.5 million or 8.0% year over year to $74.1
million versus $68.7 million in the prior year
period. Consolidated Adjusted EBITDA margin(1) increased 116
basis points year over year to 24.4%.
Operating income decreased $4.4 million or 11.9% year over year
to $33.0 million in the 2012 third quarter. Income from
continuing operations was $6.8 million in the 2012 third quarter
versus $11.8 million in the prior year period. The year over
year decrease in both Operating income and Income from continuing
operations was driven principally by increased depreciation and
amortization and pre-opening expenses associated with the opening
of L'Auberge Baton Rouge.
Adjusted income per share, which normalizes for the effect of
pre-opening expenses, discontinued operations and other
non-recurring items, increased $0.05 or 20% year over year to $0.30
in the 2012 third quarter. GAAP net loss per share was $(0.01)
in the 2012 third quarter and in the prior year period.
Summary of Third
Quarter Financial Results |
($ in thousands, except per
share data) |
Three Months
Ended September 30, |
|
2012 |
2011 |
Net revenues |
$ 304,184 |
$295,853 |
Consolidated Adjusted EBITDA (1) |
$74,116 |
$68,656 |
Consolidated Adjusted EBITDA margin
(1) |
24.4% |
23.2% |
Income from continuing operations |
$6,757 |
$11,779 |
Income from continuing operations
margin |
2.2% |
4.0% |
Operating income (2) |
$33,046 |
$37,492 |
GAAP net (loss) (3) |
$(358) |
$(790) |
GAAP net (loss) per share (3) |
$(0.01) |
$(0.01) |
Adjusted income per share (1) |
$0.30 |
$0.25 |
|
(1) For a further
description of Consolidated Adjusted EBITDA, Consolidated Adjusted
EBITDA margin, and Adjusted Income per share please see the section
entitled "Non-GAAP Financial Measures" and the reconciliations
below. |
(2) Operating income in 3Q
2012 includes $11.5 million in pre-opening and development costs
versus $2.5 million in the prior year period. Operating income
in 3Q 2012 includes a $0.1 million net impact related to
write-downs, reserves and recoveries versus $1.3 million in the
prior year period. |
(3) GAAP net (loss) and
(loss) per share in 3Q 2012 include a loss of $7.1 million, or
$0.11 per share, net of taxes, from discontinued
operations. GAAP net (loss) and net (loss) per share in 3Q
2011 include a loss of $12.6 million, or $0.20 per share, net of
taxes, from discontinued operations. |
Anthony Sanfilippo, President and Chief Executive Officer of
Pinnacle Entertainment, commented, "Our third quarter is
highlighted by the opening of L'Auberge Baton Rouge, a terrific
addition to the Pinnacle Entertainment portfolio of properties. Our
Company delivered very strong financial performance in the third
quarter and achieved several operational milestones. L'Auberge
Lake Charles produced all-time records in gaming revenue,
non-gaming revenue, Adjusted EBITDA and Adjusted EBITDA margin
during the third quarter. Impressively, this performance was
achieved despite the impact that Hurricane Isaac had on L'Auberge
Lake Charles and our other Louisiana properties. Furthermore, St.
Louis produced the strongest year over year improvement in Adjusted
EBITDA in the Company's portfolio and achieved record Adjusted
EBITDA margins in the third quarter.
"While Hurricane Isaac caused us to briefly delay our scheduled
opening, we proudly unveiled L'Auberge Baton Rouge to a robust
crowd of guests on September 1. We are very pleased with the
reception of the property from our guests that have visited
L'Auberge Baton Rouge. In particular, the feedback we have
received on its quality, and most importantly, the high level of
service they are receiving from our Baton Rouge team members, has
been very positive. We greatly appreciate the commitment of
our team members in providing a top quality experience to our
guests in Baton Rouge.
"So far, we are very pleased with the performance of L'Auberge
Baton Rouge. The property is well on its way to establishing
itself as a high quality regional gaming and entertainment
destination. Since opening, the property has achieved over
48,000 mychoice player loyalty card sign-ups, over
267,000 casino admissions, and very strong non-gaming revenue
performance.
"With these initial encouraging results, we will continue our
efforts of methodically focusing on building profitable revenue
through the use of this unique regional property's entertainment
destination amenities, along with the charm and excitement of the
greater Baton Rouge region."
Third Quarter Operational Overview
L'Auberge Lake Charles 2012 third quarter revenues increased
$1.4 million or 1.4% year over year to $99.5 million, while
Adjusted EBITDA increased $1.9 million or 6.3% year over year to a
record $31.5 million. Adjusted EBITDA margin at the property
expanded 146 basis points year over year to a record 31.7%. 2012
third quarter performance was driven by record gaming and cash
non-gaming revenues, as well as more efficient marketing, and
occurred despite disruption to business volumes from Hurricane
Isaac.
In the St. Louis segment, revenue for the 2012 third quarter was
unchanged year over year at $98.5 million. Adjusted EBITDA
rose 14.3% or $3.2 million year over year to $25.5
million. Adjusted EBITDA margin(2) in St. Louis increased 322
basis points year over year to 25.9% in the 2012 third
quarter. 2012 third quarter performance was driven by more
efficient marketing and general operating expense discipline.
Mr. Sanfilippo commented, "Pinnacle's properties in St. Louis
and Lake Charles continue to make great progress in improving its
operating outcomes. Our best in class properties and talented team
members are achieving remarkable results."
Belterra's third quarter 2012 revenues declined $0.5 million or
1.2% to $41.6 million, while Adjusted EBITDA increased $1.2 million
or 13.9% year over year to $9.9 million. Adjusted EBITDA
margin increased 316 basis points year over year to
23.8%. Belterra's 2012 third quarter performance was driven by
a focus on removing non-value added expenses from the business.
Boomtown New Orleans revenues declined $4.2 million or 13.1%
year over year to $27.9 million in the 2012 third quarter, while
Adjusted EBITDA declined $2.5 million or 24.8% to $7.7
million. Adjusted EBITDA margin at the property was down 432
basis points year over year to 27.6% in the 2012 third
quarter. New Orleans performance was negatively impacted by
Hurricane Isaac and generally difficult market
conditions. Notwithstanding the hurricane impact, underlying
property trends improved throughout the third quarter.
Continuing on the performance of Boomtown New Orleans, Mr.
Sanfilippo added, "We are dissatisfied with the performance of
Boomtown New Orleans and are in the process of implementing changes
to the property's operating strategy to drive profitable revenue
growth. We are confident, through key operating changes, in
our ability to improve New Orleans' performance in the coming
quarters."
Boomtown Bossier City revenues declined $1.3 million or 6.2%
year over year to $19.8 million in the 2012 third quarter, while
Adjusted EBITDA decreased $0.4 million or 7.7% to $4.3
million. Adjusted EBITDA margin at the property was down 37
basis points year over year to 21.5% in the 2012 third quarter.
L'Auberge Baton Rouge revenue was $13.1 million in its inaugural
month of operation, while Adjusted EBITDA was $1.5
million. Adjusted EBITDA margin was 11.4% in the 2012 third
quarter.
Corporate overhead expenses declined $0.6 million or 9.6% year
over year to $5.6 million in the 2012 third quarter. The
reduction in 2012 third quarter corporate overhead expense was
driven principally by efforts to eliminate non-value added expenses
at the Company's Las Vegas headquarters, as well as a ramp up of
cost savings and property allocations related to the Company's
shared service centers supporting our properties in the Midwest and
Louisiana.
Baton Rouge Opens, Development Pipeline Advances, and
ACDL Investment in Place
Carlos Ruisanchez, Executive Vice President and Chief Financial
Officer of Pinnacle Entertainment, commented, "We are pleased to
have L'Auberge Baton Rouge now as an operating asset. The property
is beautiful and should bring meaningful value to our shareholders
for years to come. We remain focused on the additional growth
projects in our pipeline, namely the River Downs redevelopment,
River City Expansion, and the addition of guest rooms in New
Orleans.
"We are excited about the prospects for the new gaming
entertainment facility we plan to develop at River Downs. Our
plans call for a gaming entertainment facility comprising
approximately 1,600 video lottery terminals, multiple food and
beverage outlets, over 1,600 parking spaces and new racing
facilities. We expect the project to cost $209 million,
excluding license fees, original acquisition costs and capitalized
interest, and plan to open the facility in the first half of
2014.
"We continue to make progress on our expansion of River City in
St. Louis. The 1,600 space parking structure is nearing
completion and is expected to open by the Thanksgiving holiday
weekend next month. Construction of the second phase of this
expansion, a 200-room hotel and multi-purpose event center, has
commenced with an expected completion date in the second half of
2013. Property management has done a great job of mitigating
construction disruption during the quarter and we believe the
addition of the parking garage, hotel and event center will
meaningfully enhance River City's competitive positioning and cash
flow generation."
As previously announced, in New Orleans, construction of a $20
million, 150-room hotel is expected to begin by the end of 2012 and
is targeted for completion by the end of 2013. Mr. Ruisanchez
added, "The New Orleans hotel addition will provide access to a
broader market opportunity for this property and we expect it to
yield a return in excess of our baseline financial hurdle
rates."
ACDL continues to make significant progress with Phase 1A of the
MGM Grand Ho Tram project in Vietnam and the property remains on
track to open by the end of first quarter 2013. As previously
announced, in August the company entered into an agreement to
invest $15.6 million in ACDL as part of its $60 million convertible
preferred total capital raise. As a result of this commitment,
Pinnacle Entertainment maintained its 26% ownership in
ACDL. To date, ACDL has received approximately $54 million of
the $60 million total capital raise, inclusive of $14 million
contributed to ACDL by Pinnacle Entertainment. The balance is
expected to close and be funded in the 2012 fourth quarter.
Liquidity and Capital Expenditures
At September 30, 2012 the Company had approximately $144.4
million in cash and cash equivalents, with an estimated $70.0
million of which to be used in day-to-day operations. As of
the end of the 2012 third quarter, the Company's $410 million
revolving credit facility was undrawn and approximately $8.8
million of letters of credit were outstanding.
Capital expenditures totaled approximately $102.8 million during
the 2012 third quarter, including $81.2 million related to
L'Auberge Baton Rouge and $9.8 million for the River City
expansion. Through September 30, 2012, the Company has
incurred approximately $351.1 million of the $368 million budget
for L'Auberge Baton Rouge, excluding land costs and capitalized
interest, and $23 million of the $82 million budget for the River
City expansion.
Interest Expense
Gross interest expense before capitalized interest was $29.2
million in the 2012 third quarter versus $27.1 million in the prior
year period. Capitalized interest in the 2012 third quarter
was $6.0 million versus $2.9 million in the prior year
period. Other non-operating income was $0.3 million in the
2012 third quarter and $0.1 million in the prior year
period. The increase in capitalized interest in the 2012 third
quarter is attributable to additional investment in L'Auberge Baton
Rouge and the River City expansion, as well as the Company's
investment in ACDL. The Company ceased capitalizing interest
expense on L'Auberge Baton Rouge in September 2012.
Discontinued Operations
Discontinued operations consist of the Company's Atlantic City,
New Jersey land and Reno excess land; its former Boomtown Reno
operations; its former President Riverboat Casino in St. Louis,
Missouri; its former Casino Magic Argentina operations; its former
Casino Magic Biloxi, Mississippi operations; and its former
Bahamian operations. For the three months ended September 30,
2012, the Company recorded a loss of $7.1 million, net of income
taxes, related to its discontinued operations.
Investor Conference Call
Pinnacle Entertainment will hold a conference call for investors
today, Wednesday, October 24, 2012, at 10:00 a.m. Eastern Time
(7:00 a.m. Pacific Time) to discuss its 2012 third quarter
financial and operating results. Investors may listen to the
call by dialing (706) 679-7241. The code to access the
conference call is 36945777. Investors may also listen to the
conference call live over the Internet at www.pnkinc.com.
A replay of the conference call will be available shortly after
the conclusion of the call through November 7, 2012 by dialing
(404) 537-3406. The code to access the replay is
36945777. The conference call will also be available for
replay at www.pnkinc.com.
(1) Non-GAAP Financial Measures
Consolidated Adjusted EBITDA, Consolidated Adjusted EBITDA
margin, Adjusted net income (loss), and Adjusted income (loss) per
share are non-GAAP measurements. The Company defines
Consolidated Adjusted EBITDA as earnings before interest income and
expense, income taxes, depreciation, amortization, pre-opening and
development expenses, non-cash share-based compensation, asset
impairment costs, write-downs, reserves, recoveries,
corporate-level litigation settlement costs, gain (loss) on sale of
certain assets, loss on early extinguishment of debt, gain (loss)
on sale of equity security investments, minority interest and
discontinued operations. The Company defines Adjusted net
income (loss) as net income (loss) before pre-opening and
development expenses, asset impairment costs, write-downs,
reserves, recoveries, corporate-level litigation settlement costs,
gain (loss) on sale of certain assets, gain (loss) on early
extinguishment of debt, minority interest and discontinued
operations. The Company defines Adjusted income (loss) per
share as Adjusted net income (loss) divided by the weighted-average
number of shares of the Company's common stock
outstanding. The Company defines Consolidated Adjusted EBITDA
margin as Consolidated Adjusted EBITDA divided by revenues on a
consolidated basis. Not all of the aforementioned benefits and
costs occur in each reporting period, but have been included in the
definition based on historical activity.
The Company uses Consolidated Adjusted EBITDA and Consolidated
Adjusted EBITDA margin as relevant and useful measures to compare
operating results between accounting periods. The presentation
of Consolidated Adjusted EBITDA has economic substance because it
is used by management as a performance measure to analyze the
performance of its business and is especially relevant in
evaluating large, long-lived casino-hotel projects because it
provides a perspective on the current effects of operating
decisions separated from the substantial, non-operational
depreciation charges and financing costs of such
projects. Management eliminates the results from discontinued
operations as they are discontinued. Management also reviews
pre-opening and development expenses separately, as such expenses
are also included in total project costs when assessing budgets and
project returns, and because such costs relate to anticipated
future revenues and income. Management believes some investors
consider Consolidated Adjusted EBITDA to be a useful measure in
determining a company's ability to service or incur indebtedness,
service debt, and fund capital expenditures, acquisitions and
operations and for estimating a company's underlying cash flows
from operations before capital costs, taxes and capital
expenditures. These calculations are commonly used as a basis for
investors, analysts and credit rating agencies to evaluate and
compare operating performance and value of companies within our
industry. Consolidated Adjusted EBITDA also approximates the
measures used in the debt covenants within the Company's debt
agreements. Consolidated Adjusted EBITDA does not include
depreciation or interest expense and therefore does not reflect
current or future capital expenditures or the cost of
capital. The Company compensates for these limitations by
using other comparative measures to assist in the evaluation of
operating performance.
Adjusted net income (loss) is presented solely as supplemental
disclosure, as this is one method that management reviews and uses
to analyze the performance of its core operating business. For
many of the same reasons mentioned above relating to Consolidated
Adjusted EBITDA, management believes Adjusted net income (loss) and
Adjusted income (loss) per share are useful analytic tools as they
enable management to track the performance of its core casino
operating business separate and apart from factors that do not
impact decisions affecting its operating casino properties, such as
impairments of intangible assets or costs associated with the
Company's development activities. Management believes Adjusted
net income (loss) and Adjusted income (loss) per share are useful
to investors since these adjustments provide a measure of
performance that more closely resembles widely used measures of
performance and valuation in the gaming industry. Adjusted net
income (loss) and Adjusted income (loss) per share do not include
the costs of the Company's development activities, certain asset
sale gains, or the costs of its refinancing activities, but the
Company compensates for these limitations by using other
comparative measures to assist in evaluating the performance of its
business.
EBITDA measures, such as Consolidated Adjusted EBITDA and
Consolidated Adjusted EBITDA margin, Adjusted net income (loss) and
Adjusted income (loss) per share are not calculated in the same
manner by all companies and, accordingly, may not be an appropriate
measure of comparing performance among different
companies. See the attached "supplemental information" tables
for a reconciliation of Consolidated Adjusted EBITDA to Income
(loss) from continuing operations, a reconciliation of GAAP net
income to Adjusted net income (loss), a reconciliation of GAAP
income (loss) per share to Adjusted income (loss) per share and a
reconciliation of Consolidated Adjusted EBITDA margin to Income
(loss) from continuing operations margin.
(2) Definition of Adjusted EBITDA and Adjusted EBITDA
Margin for Operating Segments
The Company defines Adjusted EBITDA for each operating segment
as earnings before interest income and expense, income taxes,
depreciation, amortization, pre-opening and development expenses,
non-cash share-based compensation, asset impairment costs,
write-downs, reserves, recoveries, gain (loss) on sale of certain
assets, gain (loss) on early extinguishment of debt, gain (loss) on
sale of discontinued operations, and discontinued
operations. The Company defines Adjusted EBITDA margin for
each operating segment as Adjusted EBITDA divided by revenues for
such segment. The Company uses Adjusted EBITDA and Adjusted
EBITDA margin to compare operating results among its properties and
between accounting periods.
About Pinnacle Entertainment
Pinnacle Entertainment, Inc. owns and operates seven casinos,
located in Louisiana, Missouri, and Indiana, and a racetrack in
Ohio. In addition, Pinnacle is redeveloping River Downs in
Cincinnati, Ohio into a gaming entertainment facility and holds a
26% ownership stake in Asian Coast Development (Canada) Ltd.
(ACDL), an international development and real estate company
currently developing Vietnam's first large-scale integrated resort
on the Ho Tram Strip.
The Pinnacle Entertainment, Inc. logo is available at
http://www.globenewswire.com/newsroom/prs/?pkgid=13121
All statements included in this press release, other than
historical information or statements of historical fact, are
"forward-looking statements" within the meaning of Section 27A of
the Securities Act of 1933 and Section 21E of the Securities
Exchange Act of 1934. These forward-looking statements, including
statements regarding the Company's future operating performance;
future growth; ability to implement strategies to improve revenues
and operating margins at the Company's properties; the Company's
share repurchase authorization and timing and ability to repurchase
shares of the Company's common stock under a share repurchase
program; ability to successfully implement marketing programs to
increase revenue at the Company's properties; continued operating
performance at the Company's L'Auberge Lake Charles and St. Louis
properties; the Company's ability to achieve the expected financial
objectives and returns of its L'Auberge Baton Rouge property; the
Company's ability to improve operations and performance at Boomtown
New Orleans; the budgets, completion and opening schedules of the
Company's various projects, including the Boomtown New Orleans
hotel project, the River City expansion project, and River Downs
project; the facilities, features and amenities of the River
Downs project; the anticipated capital expenditures for the fourth
quarter of 2012 and for 2013; the possibility for video lottery
terminals becoming operational at Ohio racetracks; the ability of
the Company to sell or otherwise dispose of discontinued
operations; the ability of the Company to enter into an agreement
to sell the Company's Atlantic City land holdings; the projected
opening date for MGM Grand Ho Tram, are based on management's
current expectations and are subject to risks, uncertainties and
changes in circumstances that could significantly affect future
results. Accordingly, Pinnacle cautions that the forward-looking
statements contained herein are qualified by important factors that
could cause actual results to differ materially from those
reflected by such statements. Such factors include, but are not
limited to: (a) the Company's business may be sensitive to
reductions in consumers' discretionary spending as a result of
downtowns in the economy; (b) the global financial crisis may have
an impact on the Company's business and financial condition in ways
that the Company currently cannot accurately predict; (c)
significant competition in the gaming industry in all of the
Company's markets could adversely affect the Company's
profitability; (d) many factors, including the escalation of
construction costs beyond increments anticipated in its
construction budgets and unexpected construction delays, could
prevent the Company from completing its various projects within the
budgets and on time, including the Boomtown New Orleans hotel
project, the River City expansion project and the River Downs
project; (e) video lottery terminals may not become operational at
Ohio's racetracks; (f) the terms of the Company's credit facility
and the indentures governing its senior and subordinated
indebtedness impose operating and financial restrictions on the
Company; (g) the Company faces many risks associated with its
investment in ACDL, which is developing a complex of integrated
resorts in Vietnam, such as ACDL's ability to raise capital to
complete the first phase of first integrated resort and to fund the
development of subsequent phases of the planned resort complex,
among other risks; (h) many factors, including the escalation of
construction costs beyond increments anticipated in construction
budgets, could prevent ACDL from completing its Ho Tram development
project within budget and on time and as required by the conditions
of its certificate in Vietnam; (i) ACDL will have to obtain
all necessary approvals for completing the Ho Tram development
project, including gaming and regulatory approvals, some of which
are beyond its control; (j) fluctuations in the trading volume and
market price of shares of the Company's common stock, general
business and market conditions and management's determination of
alternative needs and uses of the Company's cash resources may
affect the Company's share repurchase program; (k) the Company may
experience delays in entering into an agreement to sell the
Company's Atlantic City land holdings due to circumstances beyond
its control or an agreement may not be entered into at all; and (l)
other risks, including those as may be detailed from time to time
in the Company's filings with the Securities and Exchange
Commission ("SEC"). For more information on the potential factors
that could affect the Company's financial results and business,
review the Company's filings with the SEC, including, but not
limited to, its Annual Report on Form 10-K, its Quarterly Reports
on Form 10-Q and its Current Reports on Form 8-K.
Belterra, Boomtown, Casino Magic, Heartland Poker Tour,
L'Auberge Lake Charles, L'Auberge Baton Rouge, Lumière Place, River
City, and River Downs are registered trademarks of Pinnacle
Entertainment, Inc. All rights reserved.
- financial tables follow -
Pinnacle Entertainment,
Inc. |
Condensed Consolidated
Statements of Operations |
(In thousands, except per share
data, unaudited) |
|
|
For the three
months ended September 30, |
For the nine
months ended September 30, |
|
2012 |
2011 |
2012 |
2011 |
Revenues: |
|
|
|
|
Gaming |
$262,353 |
$254,548 |
$777,951 |
$755,580 |
Food and beverage |
19,960 |
18,665 |
55,874 |
53,027 |
Lodging |
10,819 |
11,505 |
30,391 |
29,165 |
Retail, entertainment and other |
11,052 |
11,135 |
31,263 |
27,641 |
|
304,184 |
295,853 |
895,479 |
865,413 |
Expenses and other
costs: |
|
|
|
|
Gaming |
141,778 |
142,612 |
422,298 |
428,499 |
Food and beverage |
20,284 |
18,423 |
55,492 |
53,042 |
Lodging |
6,373 |
5,534 |
17,035 |
15,864 |
Retail, entertainment and other |
6,613 |
6,802 |
17,660 |
16,601 |
General and administrative |
56,879 |
55,445 |
168,208 |
166,878 |
Depreciation and amortization |
27,562 |
25,770 |
80,009 |
77,886 |
Pre-opening and development costs |
11,546 |
2,465 |
18,516 |
7,174 |
Write-downs, reserves and recoveries,
net |
103 |
1,310 |
899 |
7,930 |
|
271,138 |
258,361 |
780,117 |
773,874 |
Operating income |
33,046 |
37,492 |
115,362 |
91,539 |
Interest expense, net |
(22,960) |
(24,034) |
(67,363) |
(75,711) |
Loss on early extinguishment of debt |
-- |
(183) |
(20,718) |
(183) |
Loss from equity method investment |
(1,367) |
(544) |
(4,206) |
(544) |
Income from continuing operations before
income taxes |
8,719 |
12,731 |
23,075 |
15,101 |
Income tax expense |
(1,962) |
(952) |
(3,701) |
(2,594) |
Income from continuing operations |
6,757 |
11,779 |
19,374 |
12,507 |
Loss from discontinued operations, net of
income taxes |
(7,115) |
(12,569) |
(8,783) |
(40,014) |
Net income (loss) |
$(358) |
$(790) |
$10,591 |
$(27,507) |
|
|
|
|
|
Net income (loss) per common
share—basic |
|
|
|
|
Income from continuing operations |
$0.11 |
$0.19 |
$0.31 |
$0.20 |
Loss from discontinued operations, net of
income taxes |
$(0.12) |
$(0.20) |
$(0.14) |
$(0.65) |
|
|
|
|
|
Net income (loss) per common
share—basic |
$(0.01) |
$(0.01) |
$0.17 |
$(0.45) |
|
|
|
|
|
Net Income (loss) per common
share—diluted |
|
|
|
|
Income from continuing operations |
$ 0.10 |
$0.19 |
$0.31 |
$0.20 |
Loss from discontinued operations, net of
income taxes |
$(0.11) |
$(0.20) |
$(0.14) |
$(0.65) |
|
|
|
|
|
Net income (loss) per common
share—diluted |
$(0.01) |
$(0.01) |
$0.17 |
$(0.45) |
|
|
|
|
|
Number of shares—basic |
61,560 |
62,059 |
62,095 |
61,940 |
Number of shares—diluted |
62,027 |
62,564 |
62,498 |
62,453 |
|
Pinnacle Entertainment,
Inc. |
Condensed Consolidated
Balance Sheets |
(In thousands) |
|
|
(Unaudited) September 30,
2012 |
December 31,
2011 |
Assets |
|
|
Cash and cash equivalents |
$144,431 |
$78,597 |
Other assets, including restricted cash |
318,462 |
283,122 |
Land, buildings, riverboats and equipment,
net |
1,683,693 |
1,515,029 |
Assets of discontinued operations held for
sale |
38,608 |
73,871 |
Total assets |
$2,185,194 |
$1,950,619 |
|
|
|
Liabilities and Stockholders'
Equity |
|
|
Liabilities, other than long-term debt |
$231,158 |
$200,889 |
Long-term debt, including current
portion |
1,441,017 |
1,223,985 |
Liabilities of discontinued operations held
for sale |
68 |
2,923 |
Deferred income taxes |
3,430 |
3,430 |
Total liabilities |
1,675,673 |
1,431,227 |
|
|
|
Stockholders' equity |
509,521 |
519,392 |
Total liabilities and stockholders'
equity |
$2,185,194 |
$1,950,619 |
|
Pinnacle Entertainment,
Inc. |
Supplemental
Information |
Property Revenues and
Adjusted EBITDA, |
Reconciliation of
Consolidated Adjusted EBITDA to Income from Continuing
Operations, |
and Reconciliation of
Consolidated Adjusted EBITDA Margin |
to Income from
Continuing Operations Margin |
|
(In thousands, unaudited) |
|
|
For the three
months ended September 30, |
For the nine
months ended September 30, |
|
2012 |
2011 |
2012 |
2011 |
Revenues |
|
|
|
|
L'Auberge Lake Charles |
$99,538 |
$98,175 |
$297,308 |
$283,103 |
St. Louis (a) |
98,521 |
98,406 |
299,245 |
288,461 |
Boomtown New Orleans |
27,948 |
32,144 |
92,565 |
102,518 |
Belterra Casino Resort |
41,550 |
42,056 |
120,370 |
117,338 |
Boomtown Bossier City |
19,815 |
21,114 |
62,779 |
65,434 |
L'Auberge Baton Rouge |
13,061 |
-- |
13,061 |
-- |
River Downs |
3,533 |
3,927 |
9,873 |
8,460 |
Other |
218 |
31 |
278 |
99 |
|
|
|
|
|
Total Revenues |
$304,184 |
$295,853 |
$895,479 |
$865,413 |
|
|
|
|
|
Adjusted EBITDA (Loss)
(c) |
|
|
|
|
L'Auberge Lake Charles |
$31,538 |
$29,672 |
$91,612 |
$79,520 |
St. Louis (a) |
25,537 |
22,343 |
76,315 |
63,296 |
Boomtown New Orleans |
7,708 |
10,254 |
28,701 |
34,227 |
Belterra Casino Resort |
9,884 |
8,675 |
26,349 |
21,938 |
Boomtown Bossier City |
4,268 |
4,626 |
14,812 |
14,638 |
L'Auberge Baton Rouge |
1,488 |
-- |
1,488 |
-- |
River Downs(b) |
(512) |
(746) |
(1,274) |
(1,696) |
Other |
(217) |
-- |
(217) |
-- |
|
79,694 |
74,824 |
237,786 |
211,923 |
Corporate expenses |
(5,578) |
(6,168) |
(15,939) |
(22,031) |
Consolidated Adjusted EBITDA
(c) |
$74,116 |
$68,656 |
$221,847 |
$189,892 |
|
|
|
|
|
Reconciliation to Income
from Continuing Operations |
Consolidated Adjusted EBITDA |
$74,116 |
$68,656 |
$221,847 |
$189,892 |
Pre-opening and development costs |
(11,546) |
(2,465) |
(18,516) |
(7,174) |
Non-cash share-based compensation |
(1,859) |
(1,619) |
(7,061) |
(5,363) |
Write-downs, reserves and recoveries,
net |
(103) |
(1,310) |
(899) |
(7,930) |
Depreciation and amortization |
(27,562) |
(25,770) |
(80,009) |
(77,886) |
Loss on equity method investment |
(1,367) |
(544) |
(4,206) |
(544) |
Interest expense, net |
(22,960) |
(24,034) |
(67,363) |
(75,711) |
Loss on early extinguishment of debt |
-- |
(183) |
(20,718) |
(183) |
Income tax expense |
(1,962) |
(952) |
(3,701) |
(2,594) |
|
|
|
|
|
Income from continuing
operations |
$6,757 |
$11,779 |
$19,374 |
$12,507 |
|
|
|
|
|
Consolidated Adjusted EBITDA margin
(c) |
24.4% |
23.2% |
24.8% |
21.9% |
Income from continuing operations
margin |
2.2% |
4.0% |
2.2% |
1.4% |
|
(a) St.
Louis includes operating results at Lumière Place, Four Seasons
Hotel & Spa, and River City Casino. |
(b) River Downs was
acquired on January 28, 2011. |
(c) See discussion of
Non-GAAP Financial Measures above for a detailed description of
Consolidated Adjusted EBITDA and Consolidated Adjusted EBITDA
margin. |
Pinnacle Entertainment,
Inc. |
Supplemental
Information |
Loss from Discontinued
Operations, Net of Income Taxes |
(In thousands, unaudited) |
|
|
For the three
months |
For the nine
months |
|
ended September
30, |
ended September
30, |
|
2012 |
2011 |
2012 |
2011 |
Boomtown Reno Hotel & Casino |
$(290) |
$(11,482) |
$(1,820) |
$(13,215) |
Atlantic City |
(7,042) |
(1,429) |
(7,141) |
(26,818) |
Other |
(14) |
153 |
(201) |
(187) |
Income tax benefit |
231 |
189 |
379 |
206 |
Loss from discontinued operations,
net of income taxes |
$ (7,115) |
$ (12,569) |
$ (8,783) |
$ (40,014) |
|
|
Pinnacle Entertainment,
Inc. |
Supplemental
Information |
Reconciliations of GAAP
Net Income (Loss) to Adjusted Net Income |
and GAAP Net Income
(Loss) Per Share to Adjusted Income Per Share |
(In thousands, except per share
amounts, unaudited) |
|
|
For the three
months ended September 30, |
For the nine
months ended September 30, |
|
2012 |
2011 |
2012 |
2011 |
|
|
|
|
|
GAAP net income (loss) |
$(358) |
$(790) |
$10,591 |
$(27,507) |
Pre-opening and development costs |
11,546 |
2,465 |
18,516 |
7,174 |
Write-downs, reserves and recoveries,
net |
103 |
1,310 |
899 |
7,930 |
Loss on early extinguishment of debt |
-- |
183 |
20,718 |
183 |
Adjustment for income taxes |
639 |
(59) |
(607) |
(234) |
Loss from discontinued operations, net of
income taxes |
7,115 |
12,569 |
8,783 |
40,014 |
|
|
|
|
|
Adjusted net income (a) |
$19,045 |
$15,678 |
$58,900 |
$27,560 |
|
|
|
|
|
GAAP net income (loss) per share |
$(0.01) |
$(0.01) |
$0.17 |
$(0.45) |
Pre-opening and development costs |
0.19 |
0.04 |
0.30 |
0.11 |
Write-downs, reserves and recoveries,
net |
0.00 |
0.02 |
0.01 |
0.13 |
Loss on early extinguishment of debt |
-- |
0.00 |
0.33 |
0.00 |
Adjustment for income taxes |
0.01 |
(0.00) |
(0.01) |
(0.00) |
Loss from discontinued operations, net of
income taxes |
0.11 |
0.20 |
0.14 |
0.65 |
|
|
|
|
|
Adjusted income per share
(a) |
$0.30 |
$0.25 |
$0.94 |
$0.44 |
|
|
|
|
|
Number of shares –
diluted |
62,027 |
62,564 |
62,498 |
62,452 |
|
(a) See discussion of
Non-GAAP Financial Measures above for detailed descriptions of
Adjusted net income and Adjusted income per share. |
CONTACT: Investor Relations
Vincent J. Zahn, CFA
Vice President, Finance and Investor Relations
702/541-7777 or investors@pnkmail.com
Media Relations
Kerry Andersen
Director, Public Relations
337/395-7631 or kandersen@pnkmail.com
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