MONARCH CASINO & RESORT, INC. Condensed Consolidated Statements of Income (Unaudited) Three Months Ended Nine Months Ended September 30, September 30, -------------------------- -------------------------- 2010 2009 2010 2009 ------------ ------------ ------------ ------------ Revenues Casino $ 26,039,912 $ 24,385,970 $ 75,214,951 $ 71,336,715 Food and beverage 10,595,591 9,546,449 30,949,116 28,965,730 Hotel 6,361,763 5,653,926 17,471,295 15,680,384 Other 2,075,795 1,665,197 5,910,951 5,112,754 ------------ ------------ ------------ ------------ Gross revenues 45,073,061 41,251,542 129,546,313 121,095,583 Less promotional allowances (7,392,963) (6,405,742) (21,358,767) (19,279,190) ------------ ------------ ------------ ------------ Net revenues 37,680,098 34,845,800 108,187,546 101,816,393 ------------ ------------ ------------ ------------ Operating expenses Casino 9,822,885 8,959,794 28,676,670 26,820,573 Food and beverage 4,955,400 4,600,471 13,976,186 13,774,017 Hotel 1,570,286 1,807,230 4,621,108 5,021,467 Other 745,261 654,750 2,151,185 2,000,936 Selling, general and administrative 12,785,043 12,203,807 35,757,641 36,133,433 Depreciation and amortization 3,394,258 3,034,674 9,919,984 9,310,580 ------------ ------------ ------------ ------------ Total operating expenses 33,273,133 31,260,726 95,102,774 93,061,006 ------------ ------------ ------------ ------------ Income from operations 4,406,965 3,585,074 13,084,772 8,755,387 ------------ ------------ ------------ ------------ Other income (expense) Other income - 36,205 16,000 171,912 Interest expense (334,028) (486,921) (1,158,303) (1,608,138) ------------ ------------ ------------ ------------ Total other expense (334,028) (450,716) (1,142,303) (1,436,226) ------------ ------------ ------------ ------------ Income before income taxes 4,072,937 3,134,358 11,942,469 7,319,161 Provision for income taxes (1,407,000) (1,096,500) (4,174,055) (2,561,225) ------------ ------------ ------------ ------------ Net income $ 2,665,937 $ 2,037,858 $ 7,768,414 $ 4,757,936 ============ ============ ============ ============ Earnings per share of common stock Net income Basic $ 0.17 $ 0.13 $ 0.48 $ 0.30 Diluted $ 0.17 $ 0.13 $ 0.48 $ 0.29 Weighted average number of common shares and potential common shares outstanding Basic 16,132,531 16,122,593 16,129,017 16,122,232 Diluted 16,209,724 16,180,168 16,194,332 16,159,669 MONARCH CASINO & RESORT, INC. Condensed Consolidated Balance Sheets September 30, December 31, ------------- ------------- 2010 2009 ------------- ------------- ASSETS (Unaudited) Current assets Cash and cash equivalents $ 10,843,738 $ 14,420,323 Receivables, net 3,606,120 2,294,703 Federal income tax receivable 1,050,849 - Inventories 1,800,217 1,706,867 Prepaid expenses 2,450,672 2,623,650 Deferred income taxes 780,550 1,090,063 ------------- ------------- Total current assets 20,532,146 22,135,606 ------------- ------------- Property and equipment Land 13,172,522 13,172,522 Land improvements 3,511,484 3,511,484 Buildings 140,522,106 140,522,106 Building improvements 10,597,698 10,410,770 Furniture and equipment 111,238,662 107,655,784 Leasehold improvements 1,346,965 1,346,965 ------------- ------------- 280,389,437 276,619,631 Less accumulated depreciation and amortization (123,287,532) (113,538,145) ------------- ------------- Net property and equipment 157,101,905 163,081,486 Other assets, net 376,438 569,622 ------------- ------------- Total assets $ 178,010,489 $ 185,786,714 ============= ============= LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities Borrowings under credit facility $ - $ 1,000,000 Accounts payable 6,972,541 8,984,010 Accrued expenses 12,740,776 11,056,079 Federal income taxes payable - 46,546 ------------- ------------- Total current liabilities 19,713,317 21,086,635 ------------- ------------- Long-term debt, less current maturities 32,000,000 47,500,000 Deferred income taxes 4,707,594 4,695,657 ------------- ------------- Total Liabilities 56,420,911 73,282,292 ------------- ------------- Stockholders' equity Preferred stock, $.01 par value, 10,000,000 shares authorized; none issued - - Common stock, $.01 par value, 30,000,000 shares authorized; 19,096,300 shares issued; 16,138,158 outstanding at 9/30/10 16,125,388 outstanding at 12/31/09 190,963 190,963 Additional paid-in capital 31,034,509 30,041,083 Treasury stock, 2,958,142 shares at 9/30/10 2,970,912 shares at 12/31/09, at cost (48,541,663) (48,864,979) Retained earnings 138,905,769 131,137,355 ------------- ------------- Total stockholders' equity 121,589,578 112,504,422 ------------- ------------- Total liability and stockholder's equity $ 178,010,489 $ 185,786,714 ============= ============= MONARCH CASINO & RESORT, INC. Reconciliation of Net Income to EBITDA (1) (Unaudited) Three Months Ended Nine Months Ended September 30, September 30, -------------------------- -------------------------- 2010 2009 2010 2009 ------------- ------------ ------------ ------------ Net income $ 2,665,937 $ 2,037,858 $ 7,768,414 $ 4,757,936 Adjustments Provision for income taxes 1,407,000 1,096,500 4,174,055 2,561,225 Interest expense 334,028 486,921 1,158,303 1,608,138 Depreciation & amortization 3,394,258 3,034,674 9,919,984 9,310,580 Other income - (36,205) (16,000) (171,912) ------------- ------------ ------------ ------------ EBITDA (1) $ 7,801,223 $ 6,619,748 $ 23,004,756 $ 18,065,967 ============= ============ ============ ============(1) "EBITDA" consists of net income plus provision for income taxes, interest expense, depreciation and amortization less interest income. 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 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.
Contact Information: Contacts: Ron Rowan CFO (775) 825-4700 John Farahi CEO (775) 825-4700 For additional information visit Monarch's web site at MonarchCasino.com.