ISLE OF CAPRI CASINOS ST. LOUIS, Dec. 2, 2015 /PRNewswire/ -- Isle of Capri Casinos, Inc. (NASDAQ: ISLE) (the "Company") today reported financial results for the second quarter of fiscal year 2016 ended October 25, 2015 and other Company-related news.
Fiscal 2016 Second Quarter Highlights
-- Adjusted EBITDA increased 9.3% to $48.4 million year over year.
-- Adjusted EBITDA margin increased to 20.5%, up 159 bps year over year.
-- Adjusted earnings per share from continuing operations of $0.19 versus
$0.05 in the prior year quarter.
Consolidated Financial Results
The following table outlines the Company's financial results (dollars in millions, except per share data, unaudited):
Three Months Ended Six Months Ended
------------------ ----------------
October 25, October 26, October 25, October 26,
2015 2014 2015 2014
---- ---- ---- ----
Net revenues $236.3 $234.5 $483.2 $471.4
Consolidated
Adjusted EBITDA
(1) 48.4 44.3 99.5 88.4
Income (loss)
from continuing
operations 7.8 (0.1) 16.3 (1.8)
Income (loss)
from
discontinued
operations 3.6 (1.0) (1.7) (1.5)
Net income (loss) 11.5 (1.0) 14.6 (3.3)
Diluted income
(loss) per share
from continuing
operations 0.19 (0.00) 0.39 (0.05)
Diluted income
(loss) per share
from
discontinued
operations 0.09 (0.03) (0.04) (0.03)
Diluted net
income (loss)
per share 0.28 (0.03) 0.35 (0.08)
Adjusted income
per share (2) 0.19 0.05 0.46 0.08
(1) For a further description of
Consolidated Adjusted EBITDA, refer to
the reconciliation tables following the
narrative and the definition of
Adjusted EBITDA in footnote (1) of this
release.
(2) For a reconciliation of the GAAP basis
per share amounts to adjusted income
(loss) per share, refer to the
reconciliation table labeled
"Reconciliation of GAAP Income (Loss)
from Continuing Operations to Adjusted
Income (Loss) and GAAP Income (Loss)
from Continuing Operations Per Share
to Adjusted Income (Loss) Per Share."
Virginia McDowell, the Company's president and chief executive officer, commented,
"We grew Adjusted EBITDA for the seventh consecutive quarter with 11 of 14 properties reporting Adjusted EBITDA increases. This quarter marks an important achievement in our continuing efforts to optimize our marketing reinvestment. As we continue to target our marketing dollars toward more profitable customers, we strategically reduced promotional allowances nearly 10% during the quarter, which also resulted in a slight reduction in our gross revenues. Nonetheless, in combination with prudent expense management, we grew Adjusted EBITDA by 9.3%, resulting in flow through of more than 200% and a 160-basis-point increase in operating margins.
"We continue to use our free cash flow to invest in our properties and deleverage our balance sheet. We are renovating hotel rooms and food and beverage outlets, upgrading our technology platforms and introducing new products to our casino floors. At the same time, we reduced our debt balance by $30 million during the quarter. Our balance sheet is now in the best shape it has been in over a decade."
Financial Highlights
Net revenues for the current quarter were $236.3 million compared to $234.5 million in the prior year quarter, up 0.8%. Consolidated Adjusted EBITDA was $48.4 million for the quarter compared to $44.3 million in the prior year quarter, up 9.3%. Adjusted EBITDA margin increased to 20.5% from 18.9%. Interest expense was $17.0 million relative to $21.1 million in the prior year quarter, as a result of our lower overall debt balance as well as the benefits of refinancing our 7.75% Senior Notes due 2019, completed early in the first quarter of fiscal 2016.
Operating results in the prior year's quarter were impacted by $3.0 million in expenses related to a voter referendum in Colorado and a favorable property tax settlement related to our Waterloo property of $1.2 million.
On October 19, 2015, we closed our gaming operations in Natchez, Mississippi and completed the previously announced sale of our hotel and certain non-gaming assets to Casino Holding Investment Partners, LLC, the parent company of Magnolia Bluffs Casino in Natchez. During the quarter, we recorded a gain of $6.4 million on the sale of these assets, which was partially offset by severance and operating losses incurred during the quarter. The gain and operating results of Natchez are reflected in discontinued operations for all periods presented.
On a GAAP basis, diluted income per share from continuing operations was $0.19 compared to a diluted loss per share from continuing operations of ($0.00) in the prior year's quarter. Net income per share was $0.28 for the quarter, relative to a net loss of ($0.03) per share in the prior year quarter. Adjusted income per share from continuing operations was $0.19 for the quarter compared to adjusted net income per share from continuing operations of $0.05 in the prior year.
Operating Results
(All comparisons are to the prior year quarter)
Black Hawk - Net revenues increased $0.9 million, or 2.6%, to $33.6 million and Adjusted EBITDA increased $1.0 million to $9.9 million, at our two casinos in Black Hawk. Black Hawk benefited from more effective marketing spend during the quarter.
Pompano - Net revenues increased 4.9%, to $38.5 million, and Adjusted EBITDA increased 17.0%, to $7.3 million at Pompano Park. The property benefited from continued improved customer reinvestment and favorable market trends.
Iowa - Net revenues for our Iowa properties increased $0.1 million to $47.0 million, while Adjusted EBITDA decreased $0.2 million to $13.1 million. Net revenues and Adjusted EBITDA were essentially flat at our Waterloo and Marquette properties. Our Bettendorf property continues to be impacted by on-going construction disruption related to the build-out of our land-based casino as well as ongoing construction related to the I-74 bridge near the property.
Lake Charles - Net revenues decreased $2.2 million, to $28.9 million, or 7.1%, while Adjusted EBITDA decreased $1.0 million to $3.5 million, or 21.7%. Results continue to be impacted by the opening of a new competitor in the market in December of 2014.
Mississippi - Net revenues for Lula and Vicksburg were flat at $19.1 million. Adjusted EBITDA increased 30.9%, to $3.9 million from $3.0 million. In Lula, we improved Adjusted EBITDA 35.0%, to $2.6 million, and improved operating margins nearly 600 bps through lower operating costs. Vicksburg's Adjusted EBITDA increased 23.0%, to $1.3 million from $1.0 million. Vicksburg's operating margins increased over 320 bps as a result of targeted customer reinvestment and reduced operating costs.
Missouri - Net revenues for our Missouri properties increased $0.7 million to $59.6 million, or 1.2%, and Adjusted EBITDA increased $1.6 million to $16.0 million, or 11.4%. Adjusted EBITDA and operating margins increased at each of our four Missouri properties during the quarter. In Caruthersville, we improved Adjusted EBITDA and operating margins by 37.4% and 530 bps, respectively, primarily as a result of recent capital improvements to the property that included new parking and slots. Cape Girardeau's Adjusted EBITDA increased 34.6% through reductions in cost of sales and other operating and marketing costs. Cape Girardeau's results also include the negative impact of approximately $0.1 million of legal fees associated with a lawsuit related to the original construction at the property that was settled subsequent to the end of the quarter. Boonville and Kansas City's Adjusted EBITDA increased 3.1% and 1.5%, respectively. We are currently renovating the hotel at Boonville and during the quarter there were over 4,000 fewer room nights available, or approximately one-third of the hotel, which impacted results.
Pennsylvania - Net revenues were $9.6 million, up 6.6%, and Adjusted EBITDA increased $0.4 million from prior year's quarter to slightly positive EBITDA. We continue to grow the database, fine tune the operating cost structure and optimize reinvestment levels.
Corporate Expenses
Corporate and development expenses were $7.0 million for the quarter compared to $6.7 million in the second quarter of fiscal 2015, primarily related to an increase in non-cash stock compensation expense, offset by the timing of our long-term incentive award, which occurred in the first quarter of the current fiscal year versus the second quarter of the prior fiscal year.
Non-cash stock compensation expense was $1.6 million for the quarter compared to $1.1 million in the second quarter of fiscal 2015. Excluding stock compensation expenses, corporate and development expenses declined 4.0%.
Capital Structure and Capital Expenditures
As of October 25, 2015, the Company had:
-- $60.2 million in cash and cash equivalents, excluding $9.8 million in
restricted cash and investments;
-- $958.6 million in total debt; and
-- $190 million in net line of credit availability.
Capital expenditures were $33.2 million in the six months ended October 25, 2015, including $28.8 million of maintenance and gaming equipment purchases as well as spending related to the hotel renovations in Bettendorf and Boonville. We have spent $4.4 million to date this fiscal year on the previously announced up to $60 million land-based project at Bettendorf. For the project to date, we have expended $6.6 million.
Consistent with previous guidance, the Company continues to expect total capital expenditures for fiscal 2016 of approximately $100 million to $105 million, inclusive of approximately $45 million to $50 million of capital spending this fiscal year related to the land-based casino build out in Bettendorf.
Conference Call Information
Isle of Capri Casinos, Inc. will host a conference call on Wednesday, December 2, 2015 at 10:00 am central time during which management will discuss the financial and other matters addressed in this press release. The conference call can be accessed by interested parties via webcast through the investor relations page of the Company's website, www.islecorp.com, or, for domestic callers, by dialing 888-346-3970. International callers can access the conference call by dialing 412-902-4263. The conference call will be recorded and available for review starting at 11:59 pm central on Wednesday, December 2, 2015, until 11:59 pm central on Wednesday, December 16, 2015, by dialing 877-344-7529; International: 412-317-0088 and access number 10076477.
About Isle of Capri Casinos, Inc.
Isle of Capri Casinos, Inc. is a leading regional gaming and entertainment company dedicated to providing guests with exceptional experience at each of the 14 casino properties that it owns or operates, primarily under the Isle and Lady Luck brands. The Company currently operates gaming and entertainment facilities in Colorado, Florida, Iowa, Louisiana, Mississippi, Missouri, and Pennsylvania. More information is available at the Company's website, www.islecorp.com.
Forward-Looking Statements
This press release may be deemed to contain forward-looking statements, which are subject to change. These forward-looking statements may be significantly impacted, either positively or negatively by various factors, including without limitation, licensing, and other regulatory approvals, financing sources, development and construction activities, costs and delays, weather, permits, competition and business conditions in the gaming industry. The forward-looking statements are subject to numerous risks and uncertainties that could cause actual results to differ materially from those expressed in or implied by the statements herein.
Additional information concerning potential factors that could affect the Company's financial condition, results of operations and expansion projects, is included in the filings of the Company with the Securities and Exchange Commission, including, but not limited to, its Form 10-K for the most recently ended fiscal year.
CONTACTS:
Isle of Capri Casinos, Inc.,
Eric Hausler, Chief Financial Officer-314.813.9205
Jill Alexander, Senior Director of Corporate
Communication-314.813.9368
http://www.islecorp.com
ISLE OF CAPRI CASINOS, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except share and per share amounts)
(Unaudited)
Three Months Ended Six Months Ended
------------------ ----------------
October 25, October 26, October 25, October 26,
2015 2014 2015 2014
---- ---- ---- ----
Revenues:
Casino $249,061 $250,138 $509,114 $499,679
Rooms 7,775 8,176 15,890 16,207
Food, beverage, pari-
mutuel and other 31,455 33,747 64,444 67,213
------ ------ ------ ------
Gross revenues 288,291 292,061 589,448 583,099
Less promotional
allowances (52,030) (57,603) (106,263) (111,745)
------- ------- -------- --------
Net revenues 236,261 234,458 483,185 471,354
Operating expenses:
Casino 37,963 39,087 76,676 78,089
Gaming taxes 63,430 63,286 129,789 126,576
Rooms 1,883 1,794 3,766 3,641
Food, beverage, pari-
mutuel and other 11,097 11,120 23,219 22,967
Marine and facilities 13,916 13,923 28,022 28,070
Marketing and
administrative 54,253 57,199 110,653 114,905
Corporate and
development 6,986 6,735 14,629 15,883
Depreciation and
amortization 21,106 19,339 41,157 38,748
------ ------ ------ ------
Total operating
expenses 210,634 212,483 427,911 428,879
------- ------- ------- -------
Operating income 25,627 21,975 55,274 42,475
Interest expense (17,004) (21,114) (34,445) (42,443)
Interest income 80 92 159 179
Loss on early
extinguishment of
debt - - (2,966) -
--- --- ------ ---
Income from continuing operations before income taxes
8,703 953 18,022 211
Income tax provision (892) (1,024) (1,743) (2,007)
---- ------ ------ ------
Income (loss) from
continuing operations 7,811 (71) 16,279 (1,796)
Income (loss) from discontinued operations, net of
income taxes
3,639 (950) (1,685) (1,542)
----- ---- ------ ------
Net income (loss) $11,450 $(1,021) $14,594 $(3,338)
======= ======= ======= =======
Income (loss) per common share-basic:
Income (loss) from
continuing operations $0.19 $0.00 $0.40 $(0.05)
Income (loss) from discontinued operations, net of
income taxes
0.09 (0.03) (0.04) (0.03)
---- ----- ----- -----
Net income (loss) $0.28 $(0.03) $0.36 $(0.08)
===== ====== ===== ======
Income (loss) per common share-dilutive:
Income (loss) from
continuing operations $0.19 $0.00 $0.39 $(0.05)
Income (loss) from discontinued operations, net of
income taxes
0.09 (0.03) (0.04) (0.03)
---- ----- ----- -----
Net income (loss) $0.28 $(0.03) $0.35 $(0.08)
===== ====== ===== ======
Weighted average basic
shares 40,697,797 39,932,856 40,639,301 39,880,379
Weighted average
diluted shares 41,426,375 39,932,856 41,341,575 39,880,379
ISLE OF CAPRI CASINOS, INC.
CONSOLIDATED BALANCE SHEETS
(In thousands, except share and per share amounts)
(Unaudited)
October 25, April 26,
2015 2015
---- ----
ASSETS
------
Current assets:
Cash and cash equivalents $60,227 $66,437
Marketable securities 19,607 19,517
Accounts receivable, net 10,893 11,171
Inventory 6,426 6,509
Deferred income taxes 6,669 4,626
Prepaid expenses and other
assets 15,190 11,274
Assets held for sale - 138
--- ---
Total current assets 119,012 119,672
Property and equipment, net 899,576 902,226
Other assets:
Goodwill 108,970 108,970
Other intangible assets, net 53,654 54,073
Deferred financing costs,
net 16,829 19,075
Restricted cash and
investments 9,767 9,193
Prepaid deposits and other 5,327 4,743
Long-term assets held for
sale - 9,810
--- -----
Total assets $1,213,135 $1,227,762
========== ==========
LIABILITIES AND STOCKHOLDERS' EQUITY
------------------------------------
Current liabilities:
Current maturities of long-
term debt $76 $170
Accounts payable 25,899 19,690
Accrued liabilities:
Payroll and related 36,303 43,371
Property and other taxes 24,513 20,456
Income taxes payable 42 125
Interest 14,819 15,350
Progressive jackpots and
slot club awards 15,439 16,123
Other 22,890 18,326
------ ------
Total current liabilities 139,981 133,611
Long-term debt, less
current maturities 958,478 992,712
Deferred income taxes 41,073 37,334
Other accrued liabilities 17,898 18,432
Other long-term liabilities 13,912 22,211
Stockholders' equity:
Preferred stock, $.01 par
value; 2,000,000 shares
authorized; none issued - -
Common stock, $.01 par value; 60,000,000 shares authorized;
shares issued: 42,066,148 at October 25, 2015 and at April
26, 2015
421 421
Class B common stock, $.01
par value; 3,000,000 shares
authorized; none issued - -
Additional paid-in capital 242,718 241,899
Retained earnings (deficit) (184,478) (199,072)
-------- --------
58,661 - 43,248
Treasury stock, 1,337,522 shares at October 25, 2015 and
1,568,875 shares at April 26, 2015
(16,868) (19,786)
------- -------
Total stockholders' equity 41,793 - 23,462
------ ------
Total liabilities and
stockholders' equity $1,213,135 $1,227,762
========== ==========
Isle of Capri Casinos, Inc.
Supplemental Data - Net Revenues
(unaudited, in thousands)
Three Months Ended Six Months Ended
------------------ ----------------
October 25, October 26, October 25, October 26,
2015 2014 2015 2014
---- ---- ---- ----
Colorado
Black Hawk $33,598 $32,738 $68,004 $64,419
Florida
Pompano 38,526 36,733 80,424 74,457
Iowa
Bettendorf 18,478 18,273 36,470 37,807
Marquette 6,939 6,950 13,810 13,437
Waterloo 21,558 21,649 43,601 42,901
Iowa Total 46,975 46,872 93,881 94,145
------
Louisiana
Lake Charles 28,868 31,075 60,693 63,611
Mississippi
Lula 12,167 12,335 25,114 25,010
Vicksburg 6,913 6,803 14,500 14,245
Mississippi Total 19,080 19,138 39,614 39,255
------
Missouri
Boonville 18,865 19,075 39,203 38,265
Cape Girardeau 15,028 14,809 29,509 29,169
Caruthersville 8,194 7,583 16,616 15,066
Kansas City 17,485 17,395 35,764 35,224
Missouri Total 59,572 58,862 121,092 117,724
------
Pennsylvania
Nemacolin 9,625 9,033 19,441 17,690
-----
Property Net Revenues
before Other 236,244 234,451 483,149 471,301
Other 17 7 36 53
--- --- --- ---
Net Revenues from
Continuing Operations $236,261 $234,458 $483,185 $471,354
======== ======== ======== ========
Isle of Capri Casinos, Inc.
Reconciliation of Operating Income (Loss) to Adjusted EBITDA
(unaudited, in thousands)
Three Months Ended October 25, 2015
-----------------------------------
Operating Income (Loss) Depreciation and Amortization Stock-Based Compensation Other Adjusted EBITDA
---------------------- ----------------------------- ------------------------ ----- ---------------
Black Hawk, Colorado $7,765 $2,162 $14 $ - $9,941
Pompano, Florida 4,713 2,558 14 - 7,285
Bettendorf, Iowa 2,125 2,690 7 - 4,822
Marquette, Iowa 1,298 377 6 - 1,681
Waterloo, Iowa 5,331 1,302 6 - 6,639
Iowa Total 8,754 4,369 19 - 13,142
-----
Lake Charles,
Louisiana 678 2,806 7 - 3,491
Lula, Mississippi 1,339 1,294 4 - 2,637
Vicksburg, Mississippi 385 884 7 - 1,276
Mississippi Total 1,724 2,178 11 - 3,913
-----
Boonville, Missouri 5,779 1,058 13 - 6,850
Cape Girardeau,
Missouri 263 2,905 5 - 3,173
Caruthersville,
Missouri 1,412 614 5 - 2,031
Kansas City, Missouri 2,963 954 6 - 3,923
Missouri Total 10,417 5,531 29 - 15,977
------
Nemacolin,
Pennsylvania (1,022) 1,068 1 47
------ ----- --- ---
Total Operating
Properties 33,029 20,672 95 - 53,796
Corporate and Other (7,402) 434 1,602 - (5,366)
Total $25,627 $21,106 $1,697 $ - $48,430
======= ======= ====== ========= =======
Three Months Ended October 26, 2014
-----------------------------------
Operating Income (Loss) Depreciation and Amortization Stock-Based Compensation Other Adjusted EBITDA
---------------------- ----------------------------- ------------------------ ----- ---------------
Black Hawk, Colorado $3,629 $2,307 $7 $3,044 $8,987
Pompano, Florida 4,489 1,732 7 - 6,228
Bettendorf, Iowa 3,524 1,436 6 - 4,966
Marquette, Iowa 1,261 402 4 - 1,667
Waterloo, Iowa 6,594 1,289 5 (1,225) 6,663
Iowa Total 11,379 3,127 15 (1,225) 13,296
------
Lake Charles,
Louisiana 1,705 2,745 6 - 4,456
Lula, Mississippi 673 1,276 4 - 1,953
Vicksburg, Mississippi 140 893 4 - 1,037
Mississippi Total 813 2,169 8 - 2,990
---
Boonville, Missouri 5,658 987 2 - 6,647
Cape Girardeau,
Missouri (458) 2,812 4 - 2,358
Caruthersville,
Missouri 846 629 3 - 1,478
Kansas City, Missouri 2,897 960 7 - 3,864
Missouri Total 8,943 5,388 16 - 14,347
-----
Nemacolin,
Pennsylvania (1,744) 1,362 3 (379)
------ ----- --- ----
Total Operating
Properties 29,214 18,830 62 1,819 49,925
Corporate and Other (7,239) 509 1,128 - (5,602)
Total $21,975 $19,339 $1,190 $1,819 $44,323
======= ======= ====== ====== =======
Isle of Capri Casinos, Inc.
Reconciliation of Operating Income (Loss) to Adjusted EBITDA
(unaudited, in thousands)
Six Months Ended October 25, 2015
---------------------------------
Operating Income (Loss) Depreciation and Amortization Stock-Based Compensation Other Adjusted EBITDA
---------------------- ----------------------------- ------------------------ ----- ---------------
Black Hawk, Colorado $16,236 $4,401 $28 $ - $20,665
Pompano, Florida 10,555 4,457 28 - 15,040
Bettendorf, Iowa 4,298 4,955 17 - 9,270
Marquette, Iowa 2,538 738 12 - 3,288
Waterloo, Iowa 10,741 2,613 14 - 13,368
Iowa Total 17,577 8,306 43 - 25,926
------
Lake Charles,
Louisiana 2,450 5,586 16 - 8,052
Lula, Mississippi 3,120 2,564 10 - 5,694
Vicksburg,
Mississippi 1,373 1,776 14 - 3,163
Mississippi Total 4,493 4,340 24 - 8,857
-----
Boonville, Missouri 12,408 2,087 25 - 14,520
Cape Girardeau,
Missouri 42 5,786 12 - 5,840
Caruthersville,
Missouri 2,968 1,226 11 - 4,205
Kansas City, Missouri 6,192 1,945 15 - 8,152
Missouri Total 21,610 11,044 63 - 32,717
------
Nemacolin,
Pennsylvania (2,163) 2,132 30 - (1)
------ ----- --- --- ---
Total Operating
Properties 70,758 40,266 232 - 111,256
Corporate and Other (15,484) 891 2,826 - (11,767)
Total $55,274 $41,157 $3,058 $ - $99,489
======= ======= ====== ========= =======
Six Months Ended October 26, 2014
---------------------------------
Operating Income (Loss) Depreciation and Amortization Stock-Based Compensation Other Adjusted EBITDA
---------------------- ----------------------------- ------------------------ ----- ---------------
Black Hawk, Colorado $8,139 $4,650 $15 $4,057 $16,861
Pompano, Florida 9,328 3,474 13 - 12,815
Bettendorf, Iowa 7,540 2,888 10 - 10,438
Marquette, Iowa 2,159 858 5 - 3,022
Waterloo, Iowa 11,942 2,475 9 (1,225) 13,201
Iowa Total 21,641 6,221 24 (1,225) 26,661
------
Lake Charles,
Louisiana 4,050 5,575 10 - 9,635
Lula, Mississippi 1,599 2,563 7 - 4,169
Vicksburg,
Mississippi 230 1,785 8 - 2,023
Mississippi Total 1,829 4,348 15 - 6,192
-----
Boonville, Missouri 11,436 1,975 8 - 13,419
Cape Girardeau,
Missouri (937) 5,602 5 - 4,670
Caruthersville,
Missouri 1,506 1,297 7 - 2,810
Kansas City, Missouri 5,809 1,909 11 - 7,729
Missouri Total 17,814 10,783 31 - 28,628
------
Nemacolin,
Pennsylvania (3,517) 2,719 4 - (794)
------ ----- --- --- ----
Total Operating
Properties 59,284 37,770 112 2,832 99,998
Corporate and Other (16,809) 978 1,957 2,259 (11,615)
Total $42,475 $38,748 $2,069 $5,091 $88,383
======= ======= ====== ====== =======
Isle of Capri Casinos, Inc.
Reconciliation of Income (Loss) From Continuing Operations to Adjusted EBITDA
(unaudited, in thousands)
Three Months Ended Six Months Ended
------------------ ----------------
October 25, October 26, October 25, October 26,
2015 2014 2015 2014
---- ---- ---- ----
Income (loss) from continuing
operations $7,811 $(71) $16,279 $(1,796)
Income tax provision 892 1,024 1,743 2,007
Loss on extinguishment of debt - - 2,966 -
Interest income (80) (92) (159) (179)
Interest expense 17,004 21,114 34,445 42,443
Depreciation and amortization 21,106 19,339 41,157 38,748
Stock-based compensation 1,697 1,190 3,058 2,069
Colorado referendum expense (3) - 3,044 - 4,057
Property tax settlement (3) - (1,225) - (1,225)
Severance expense (3) - - - 2,259
Adjusted EBITDA (1) $48,430 $44,323 $99,489 $88,383
======= ======= ======= =======
Isle of Capri Casinos, Inc.
Reconciliation of GAAP Income (Loss) From Continuing Operations to Adjusted Income (Loss) and
GAAP Income (Loss) From Continuing Operations Per Share to Adjusted Income (Loss) Per Share
(unaudited, in thousands)
Three Months Ended Six Months Ended
------------------ ----------------
October 25, October 26, October 25, October 26,
2015 2014 2015 2014
---- ---- ---- ----
GAAP income (loss)
from continuing
operations $7,811 $(71) $16,279 $(1,796)
Loss on early
extinguishment of
debt - - 2,966 -
Colorado referendum
expense (3) - 3,044 - 4,057
Property tax
settlement (3) - (1,225) - (1,225)
Severance expense (3) - - - 2,259
Adjusted income
(loss) (2) $7,811 $1,748 $19,245 $3,295
====== ====== ======= ======
GAAP income (loss)
from continuing
operations per share $0.19 $(0.00) $0.39 $(0.05)
Loss on early
extinguishment of
debt - - 0.07 -
Colorado referendum
expense (3) - 0.08 - 0.10
Property tax
settlement (3) - (0.03) - (0.03)
Severance expense (3) - - - 0.06
Adjusted income
(loss) per share (2) $0.19 $0.05 $0.46 $0.08
===== ===== ===== =====
1. Adjusted EBITDA is "earnings from
continuing operations before
interest and other non-operating
income (expense), income taxes,
stock-based compensation, certain
severance expenses, certain expenses
related to the Colorado gaming
referendum, certain property tax and
legal settlements, valuation
charges, certain asset sale gains
and depreciation and amortization."
Adjusted EBITDA is presented solely
as a supplemental disclosure because
management believes that it is 1) a
widely used measure of operating
performance in the gaming industry,
2) used as a component of
calculating required leverage and
minimum interest coverage ratios
under our Senior Credit Facility and
3) a principal basis of valuing
gaming companies. Management uses
Adjusted EBITDA as the primary
measure of the Company's operating
properties' performance, and it is
an important component in evaluating
the performance of management and
other operating personnel in the
determination of certain components
of employee compensation. Adjusted
EBITDA should not be construed as an
alternative to operating income as
an indicator of the Company's
operating performance, as an
alternative to cash flows from
operating activities as a measure of
liquidity or as an alternative to
any other measure determined in
accordance with U.S. generally
accepted accounting principles
(GAAP). The Company has significant
uses of cash flows, including
capital expenditures, interest
payments, taxes and debt principal
repayments, which are not reflected
in Adjusted EBITDA. Also, other
gaming companies that report
Adjusted EBITDA information may
calculate Adjusted EBITDA in a
different manner than the Company.
A reconciliation of Adjusted EBITDA
to income (loss) from continuing
operations is included in the
financial schedules accompanying
this release.
Certain of our debt agreements use a
similar calculation of "Adjusted
EBITDA" as a financial measure for
the calculation of financial debt
covenants and includes add back of
items such as gain on early
extinguishment of debt, preopening
expenses, certain write-offs and
valuation expenses, and non-cash
stock compensation expense.
Reference can be made to the
definition of Adjusted EBITDA in the
applicable debt agreements on file
as Exhibits to our filings with the
Securities and Exchange Commission.
2. Adjusted income (loss) is presented
solely as a supplemental disclosure
as this is one method management
reviews and utilizes to analyze the
performance of its core operating
business. For many of the same
reasons mentioned above related to
Adjusted EBITDA, management believes
Adjusted 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 gain (loss) on
early extinguishment of debt,
certain severance expenses, certain
expenses related to the Colorado
gaming referendum, certain property
tax and legal settlements, valuation
charges, certain asset sale gains
and preopening expenses. Management
believes Adjusted income (loss) and
Adjusted income (loss) per share are
useful to investors since these
adjustments provide a measure of
financial performance that more
closely resembles widely used
measures of performance and
valuation in the gaming industry.
Adjusted income (loss) and adjusted
income (loss) per share do not
include the gain (loss) on early
extinguishment of debt, certain
severance expenses, certain expenses
related to the Colorado gaming
referendum, certain property tax and
legal settlements, valuation
charges, certain asset sale gains
and preopening expenses.
3. The Company incurred $3.0 million and
$4.1 million of expense during the
three months and six months ended
October 26, 2014, respectively,
related to the Colorado gaming
expansion referendum. The Company
had a favorable property tax
settlement related to our Waterloo
property of $1.2 million in during
the three and six months ended
October 26, 2014. The Company
recorded $2.3 million of severance
expense during the six months ended
October 26, 2014, related to
restructuring at the corporate
office.
To view the original version on PR Newswire, visit:http://www.prnewswire.com/news-releases/isle-of-capri-casinos-inc-announces-fiscal-2016-second-quarter-results-300186705.html
SOURCE Isle of Capri Casinos, Inc.
