LAS VEGAS, Sept. 14, 2015 (GLOBE NEWSWIRE) -- 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 income | $ 457,996 | $ 354,029 |
Adjustments: | ||
Net interest expense and change in swap fair value | 100,108 | 139,500 |
Income tax expense | 227,512 | 153,029 |
Depreciation and amortization | 510,794 | 545,035 |
Acquisition expenses | 180,120 | -- |
Stock options amortization and employee stock purchases | 30,195 | 14,862 |
Gain on sale of assets | (163,481) | (8,032) |
Deferred rent amortization | 7,911 | 1,099 |
Adjusted EBITDA | $ 1,351,155 | $ 1,199,522 |
Forward-Looking Statements
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 | ||||
July 31, | April 30, | |||
2015 | 2015 | |||
(unaudited) | ||||
ASSETS | ||||
Current assets: | ||||
Cash and cash equivalents | $ 7,153,929 | $ 8,541,670 | ||
Restricted cash | 1,535,092 | 1,724,439 | ||
Accounts receivable, net of allowances | 757,937 | 297,316 | ||
Prepaid expenses | 1,469,904 | 845,505 | ||
Deferred tax asset, current portion | 633,718 | 863,366 | ||
Notes receivable, current portion | 390,215 | 384,464 | ||
Inventory and other current assets | 345,953 | 377,625 | ||
Total current assets | 12,286,748 | 13,034,385 | ||
Real estate held for sale | 1,100,000 | 1,100,000 | ||
Notes receivable, net of current portion | 1,214,410 | 1,314,467 | ||
Goodwill | 16,028,625 | 16,103,583 | ||
Identifiable intangible assets, net of accumulated amortization of $7,092,275 and $6,811,799 at July 31, 2015 and April 30, 2015, respectively | 4,280,901 | 4,561,377 | ||
Property and equipment, net of accumulated depreciation of $4,557,557 and $4,451,553 at July 31, 2015 and April 30, 2015, respectively | 3,843,932 | 3,990,791 | ||
Deferred tax asset, net of current portion | 2,708,566 | 2,706,430 | ||
Other assets | 1,940,215 | 331,980 | ||
Total assets | $ 43,403,397 | $ 43,143,013 | ||
LIABILITIES AND STOCKHOLDERS' EQUITY | ||||
Current liabilities: | ||||
Accounts payable and accrued liabilities | $ 1,088,984 | $ 1,222,139 | ||
Accrued payroll and related | 804,092 | 1,581,557 | ||
Accrued player's club points and progressive jackpots | 1,727,878 | 1,993,537 | ||
Total current liabilities | 3,620,954 | 4,797,233 | ||
Long-term debt | 8,148,946 | 7,350,000 | ||
Other long-term liabilities | 542,907 | 570,717 | ||
Total liabilities | 12,312,807 | 12,717,950 | ||
Stockholders' equity: | ||||
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 | 2,067,506 | 2,056,200 | ||
Additional paid-in capital | 25,041,319 | 24,845,094 | ||
Retained earnings | 10,913,800 | 10,455,804 | ||
Treasury stock, 782,837 shares at July 31, 2015 and April 30, 2015, respectively, at cost | (6,932,035) | (6,932,035) | ||
Total stockholders' equity | 31,090,590 | 30,425,063 | ||
Total liabilities and stockholders' equity | $ 43,403,397 | $ 43,143,013 | ||
Nevada Gold & Casinos, Inc. | ||||
Consolidated Statements of Operations | ||||
(unaudited) | ||||
Three Months Ended | ||||
July 31, | July 31, | |||
2015 | 2014 | |||
Revenues: | ||||
Casino | $ 14,098,696 | $ 14,151,990 | ||
Food and beverage | 2,443,110 | 2,368,941 | ||
Other | 452,671 | 440,107 | ||
Gross revenues | 16,994,477 | 16,961,038 | ||
Less promotional allowances | (1,051,703) | (1,052,424) | ||
Net revenues | 15,942,774 | 15,908,614 | ||
Expenses: | ||||
Casino | 8,047,306 | 8,203,967 | ||
Food and beverage | 1,313,369 | 1,270,650 | ||
Other | 65,594 | 67,703 | ||
Marketing and administrative | 4,140,955 | 4,112,620 | ||
Facility | 493,154 | 483,666 | ||
Corporate expense | 749,467 | 586,447 | ||
Depreciation and amortization | 510,794 | 545,035 | ||
Gain on sale of assets | (163,481) | (8,032) | ||
Total operating expenses | 15,157,158 | 15,262,056 | ||
Operating income | 785,616 | 646,558 | ||
Non-operating income (expenses): | ||||
Interest income | 25,880 | 31,155 | ||
Interest expense and amortization of loan issue costs | (119,593) | (167,763) | ||
Interest rate swap expense | (17,612) | (21,200) | ||
Change in swap fair value | 11,217 | 18,308 | ||
Income before income tax expense | 685,508 | 507,058 | ||
Income tax expense | (227,512) | (153,029) | ||
Net income | $ 457,996 | $ 354,029 | ||
Per share information: | ||||
Net income per common share - basic and diluted | $ 0.03 | $ 0.02 | ||
Basic weighted average number of shares outstanding | 16,416,737 | 16,200,135 | ||
Diluted weighted average number of shares outstanding | 16,605,308 | 16,338,534 |