(GlobeNewswire) - Nevada Gold & Casinos, Inc. (NYSE:UWN) today announced financial results for the first quarter ended July 31, 2015.
For the first quarter of fiscal 2016, the company reported net revenues of $15.9 million compared to $15.9 million in the first quarter of fiscal 2015. Operating expenses were $15.2 million compared to $15.3 million in the prior year period. Operating income was $0.8 million compared to $0.6 million and income before taxes increased to $0.7 million from $0.5 million in the prior year period. Net income was $0.5 million, or $0.03 per share, compared to $0.4 million, or $0.02 per share, in the prior year period.
Net revenues from the Washington state gaming operations increased to $13.8 million, up 3% from the $13.3 million in the prior year period and adjusted EBITDA increased to $1.7 million compared to $1.5 million in the prior year. South Dakota route revenues decreased to $2.2 million compared to $2.6 million in the prior year period, and adjusted EBITDA decreased by $100,000. Corporate expenses were $0.5 million compared to $0.6 million in the prior year. On a consolidated basis, adjusted EBITDA increased to $1.4 million from $1.2 million in the prior year quarter.
During the first quarter, the company recorded a gain of $166,500 on the sale of its Golden Nugget facility in Tukwila, WA, which closed at the end of June. The company recorded $180,000 in nonrecurring expenses related to its pending acquisition of Club Fortune Casino in Henderson, NV.
"Revenue growth from our Washington operations continues to offset the increasing operating costs, most notably for employee health care," said Michael P. Shaunnessy, President and CEO. "Our two properties south of Seattle both recorded double digit growth in volume during the first quarter. In March, a competing property in nearby Kent closed, and we benefited from the capacity reduction. With the sale of our Golden Nugget facility, and focused improvements in our nine remaining Washington properties, we continue to generate revenue improvements with attractive flow through to EBITDA that offsets the continued softness in our South Dakota route business."
The company's outstanding bank debt is $8.1 million as of July 31, 2015, and had unrestricted cash on hand of $7.2 million. The company borrowed $1.5 million in May to fund the required deposit for the pending acquisition of Club Fortune Casino in Henderson, NV.
The company is progressing on the previously announced acquisition of Club Fortune Casino, with a financing commitment from Mutual of Omaha and the licensing process in Nevada under way. We anticipate receiving the necessary regulatory approvals to allow for a closing during the third quarter of our fiscal year.
Conference Call and Webcast
The company will host a conference call at 4:30 PM ET (1:30 PM PT), today, September 14, 2015 to discuss the financial results and to provide a corporate update. The call can be accessed live by dialing (888) 287-5563. International callers can access the call by dialing (719) 325-2484. A simultaneous webcast of the call will be available by visiting http://www.nevadagold.com.
A telephone replay of the conference call will be available after 7:30 PM ET and can be accessed by dialing (877) 870-5176. International callers can access the replay by dialing (858) 384-5517; the pin number is 2829562. The replay will be available through September 21, 2015. The archived webcast will also be available on the company's website at http://ir.nevadagold.com/events.cfm.
(1) Non-GAAP Information
The term "adjusted EBITDA" is used by us in presentations, quarterly earnings calls, and other instances as appropriate. Adjusted EBITDA is defined as net income before interest, income taxes, depreciation and amortization, non-cash goodwill and other long-lived asset impairment charges, write-offs of project development costs, litigation charges, non-cash stock grants, non-cash employee stock purchase plan discounts, and net losses/gains from asset dispositions. Adjusted EBITDA excludes the impact of slot and table games hold percentages compared to the prior period. Adjusted EBITDA is presented because it is a required component of financial ratios reported by us to our lender, and it is also frequently used by securities analysts, investors, and other interested parties, in addition to and not in lieu of, U.S. Generally Accepted Accounting Principles ("GAAP") results to compare to the performance of other companies that also publicize this information. Adjusted EBITDA is not a measurement of financial performance under GAAP and should not be considered as an alternative to net income as an indicator of our operating performance or any other measure of performance derived in accordance with GAAP.
The following table reconciles Adjusted EBITDA to net income for the three months ended July 31, 2015 and 2014:
Adjusted EBITDA reconciliation to net income:
For the three months ended
July 31, 2015
July 31, 2014
Net interest expense and change in swap fair value
Income tax expense
Depreciation and amortization
Stock options amortization and employee stock purchases
Gain on sale of assets
Deferred rent amortization
This release contains forward-looking statements, which are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. We use words such as "anticipate," "believe," "expect," "future," "intend," "plan," and similar expressions to identify forward-looking statements. Forward-looking statements include, without limitation, our ability to increase income streams, to grow revenue and earnings, and to obtain additional gaming and other projects. These statements are only predictions and are subject to certain risks, uncertainties and assumptions, which are identified and described in the Company's public filings with the Securities and Exchange Commission.
About Nevada Gold & Casinos
Nevada Gold & Casinos, Inc. (NYSE:UWN) of Las Vegas, Nevada is a developer, owner and operator of nine gaming operations in Washington (wagoldcasinos.com) and a slot route operation in Deadwood, South Dakota (dakotaplayersclub.com). For more information, visit www.nevadagold.com.
Nevada Gold & Casinos, Inc.
Consolidated Balance Sheets
Cash and cash equivalents
Accounts receivable, net of allowances
Deferred tax asset, current portion
Notes receivable, current portion
Inventory and other current assets
Total current assets
Real estate held for sale
Notes receivable, net of current portion
Identifiable intangible assets, net of accumulated amortization of $7,092,275 and $6,811,799 at July 31, 2015 and April 30, 2015, respectively
Property and equipment, net of accumulated depreciation of $4,557,557 and $4,451,553 at July 31, 2015 and April 30, 2015, respectively
Deferred tax asset, net of current portion
LIABILITIES AND STOCKHOLDERS' EQUITY
Accounts payable and accrued liabilities
Accrued payroll and related
Accrued player's club points and progressive jackpots
Total current liabilities
Other long-term liabilities
Common stock, $0.12 par value per share; 50,000,000 shares authorized; 17,229,144 and 17,134,928 shares issued and 16,446,307 and 16,352,091 shares outstanding at July 31, 2015, and April 30, 2015, respectively
Additional paid-in capital
Treasury stock, 782,837 shares at July 31, 2015 and April 30, 2015, respectively, at cost
Total stockholders' equity
Total liabilities and stockholders' equity
Nevada Gold & Casinos, Inc.
Consolidated Statements of Operations
Three Months Ended
Food and beverage
Less promotional allowances
Food and beverage
Marketing and administrative
Depreciation and amortization
Gain on sale of a
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