December 15, 2015

Nevada Gold & Casinos Reports Second Quarter Results

LAS VEGAS, Dec. 15, 2015 (GLOBE NEWSWIRE) -- Nevada Gold & Casinos, Inc. (NYSE MKT:UWN) today announced financial results for the second quarter ended October 31, 2015.

For the second quarter of fiscal 2016, net revenue increased $0.4 million on a comparable unit basis.  Actual reported net revenue was $16.1 million compared to $16.4 million in the second quarter of fiscal 2015.  Net revenue from the Washington state gaming operations was $13.7 million in both periods, but on a comparable unit basis, revenue increased $0.7 million. Net revenue from the South Dakota slot operation declined $0.2 million.  Operating expenses were $15.1 million compared to $15.6 million in the prior-year period.   Operating income was $1.0 million compared to $0.8 million in the prior-year period.  Net income was $0.6 million, or $0.04 per share, compared to $0.4 million, or $0.03 per share in the prior-year period.

During the second quarter, comparable unit revenues from Washington operations increased 5%.  Adjusted EBITDA rose 24% to $2.0 million, compared to $1.6 million in the prior-year period.  The quarter's performance benefited from the sale of the Golden Nugget property which had generated an EBITDA loss of $67,000 on revenue of $670,000 in the prior year period.

South Dakota net revenue was $2.4 million compared to $2.6 million in the prior-year period and adjusted EBITDA was $252,000 compared to $313,000.

On a consolidated basis, adjusted EBITDA was $1.7 million, compared to $1.4 million in the prior-year period.  Net interest expense decreased $0.1 million, and the company expensed $0.1 million of acquisition costs related to Club Fortune.

The Company paid down $1.4 million in debt during the quarter.  The unrestricted cash balance at October 31, 2015 was $8.5 million and total outstanding borrowing was $6.7 million.

CEO, Michael P. Shaunnessy commented, "We continue to drive revenue growth in our Washington portfolio while maintaining strong margins.  The addition of Club Fortune Casino will further improve our ability to generate cash flow and increase shareholder value." 

For the six month period, net revenues were $32.1 million compared to $32.3 million in fiscal year 2015. Operating expenses were $30.3 million compared to $30.8 million in the prior year. Operating income was $1.8 million compared to $1.4 million in fiscal 2015.  Net income was $1.1 million, or $0.07 per share compared to $0.8 million or $0.05 per share in the prior year.

Conference Call and Webcast

The company will host a conference call at 4:30 PM ET (1:30 PM PT) today to discuss the financial results and to provide a corporate update. The call is for its shareholders and all members of the financial community including analysts, brokers and interested investors.

The call can be accessed live by dialing (888) 417-8516. International callers can access the call by dialing (719) 325-2323.  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 3907480. The replay will be available through December 22, 2015 at 11:59 PM ET.  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 does not take into account greater or less than expected hold percentages in the gaming operations. Adjusted EBITDA is presented because it is a required component of financial ratios reported by us to our lenders, 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.

Adjusted EBITDA reconciliations for the three months and six months ended October 31, 2015 and October 31, 2014 are shown below:

Adjusted EBITDA reconciliation to net income:
   For the three months ended
   October 31, 2015 October 31, 2014
         
Net income   $617,988  $416,067
Adjustments:        
Net interest expense and change in swap fair value    91,125  169,095
Income tax expense    301,122  199,802
Depreciation and amortization    488,709  544,620
Acquisition expenses    80,660  -
Stock compensation and employee stock purchases    80,300  30,281
Loss on sale of assets    2,050  25,120
Write off of marketable securities    -  7,539
Deferred rent amortization    4,952  1,098
Adjusted  EBITDA   $1,666,906 $1,393,622
         


    For the six months ended
    October 31, 2015 October 31, 2014
           
Net income    $1,075,985   $770,096
Adjustments:          
Net interest expense and change in swap fair value     191,232   308,595
Income tax expense     528,634   352,830
Depreciation and amortization     999,503   1,089,655
Acquisition expenses     260,780   -
Stock compensation and employee stock purchases     110,495   45,145
Loss (gain) on sale of assets     (161,430)  17,087
Write off of marketable securities     -   7,539
Deferred rent amortization     12,863   2,197
Adjusted  EBITDA    $3,018,062  $2,593,144
          


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 MKT:UWN) of Las Vegas, Nevada is a developer, owner and operator of 9 gaming operations in Washington (wagoldcasinos.com), a locals casino in Henderson, Nevada (clubfortunecasino.com) and a slot route operation in Deadwood, South Dakota (dakotaplayersclub.com). For more information, visit www.nevadagold.com.

Nevada Gold & Casinos, Inc. 
Consolidated Statements of Operations 
(unaudited) 
 
 Three Months Ended
 Six Months Ended
 
  October 31,  October 31,  October 31,  October 31, 
  2015  2014  2015  2014 
Revenues:            
Casino$  14,262,197 $  14,427,144 $  28,360,893 $  28,579,135 
Food and beverage 2,479,077  2,559,929    4,922,187    4,928,870 
Other 455,212  461,780    907,884    901,886 
Gross revenues 17,196,486  17,448,853    34,190,964    34,409,891 
Less promotional allowances   (1,062,273)   (1,089,023)   (2,113,975)   (2,128,747)
Net revenues 16,134,213  16,359,830    32,076,989    32,281,144 
             
Expenses:             
Casino 8,001,698  8,333,307    16,048,910    16,543,443 
Food and beverage 1,295,320  1,371,296    2,608,717    2,642,019 
Other 63,000  76,117    128,660    143,927 
Marketing and administrative 4,042,140  4,132,066    8,183,095    8,251,038 
Facility 492,066  532,848    985,221    1,016,514 
Corporate 738,995  551,953    1,488,462    1,138,401 
Depreciation and amortization   488,709    544,620    999,503    1,089,655 
Loss (gain) on sale of assets   2,050    25,120    (161,430)   17,087 
Total operating expenses   15,123,978    15,567,327    30,281,138    30,842,084 
Operating income   1,010,235    792,503    1,795,851    1,439,060 
Non-operating income (expenses):            
Interest income   24,749    30,362    50,630     61,517 
Interest expense and amortization of loan issue costs   (94,027)   (158,538)   (213,620)   (326,601)
Interest rate swap expense   (12,714)   (20,265)   (30,326)   (41,465)
Change in swap fair value   (9,133)   (20,654)   2,084    (2,346)
Write-off of marketable securities   -     (7,539)   -     (7,539)
Income before income tax expense   919,110    615,869    1,604,619    1,122,626 
Income tax expense   (301,122)   (199,802)   (528,634)    (352,830)
Net income$  617,988 $  416,067 $  1,075,985 $  769,796 
Per share information:             
Net income (loss) per common share - diluted$  0.04  $  0.03 $  0.07 $  0.05 
             


   
Nevada Gold & Casinos, Inc.  
Consolidated Balance Sheets  
       
  October  31,  April 30, 
  2015  2015 
       
  (unaudited)    
       
ASSETS       
Current assets:       
Cash and cash equivalents$  8,513,482 $  8,541,670 
Restricted cash   1,441,007    1,724,439 
Accounts receivable, net of allowances   639,219    297,316 
Prepaid expenses   1,109,355    845,505 
Deferred tax asset, current portion   267,594    863,366 
Notes receivable, current portion   301,221    384,464 
Inventory and other current assets   330,264    377,625 
Total current assets   12,602,142     13,034,385 
       
Real estate held for sale   1,100,000    1,100,000 
Notes receivable, net of current portion    1,107,670     1,314,467 
Goodwill   16,028,625    16,103,583 
Identifiable intangible assets, net of accumulated amortization of $7,372,751 and $6,811,799 at October 31, 2015 and April 30, 2015, respectively   4,077,359    4,561,377 
Property and equipment, net of accumulated depreciation of $4,715,093 and $4,451,553 at October 31, 2015 and April 30, 2015, respectively   3,794,401    3,990,791 
Deferred tax asset, net of current portion   2,773,568    2,706,430 
Other assets   1,925,690    331,980 
Total assets$   43,409,455  $   43,143,013  
       
LIABILITIES AND STOCKHOLDERS' EQUITY       
Current liabilities:      
Accounts payable and accrued liabilities$  1,172,598 $  1,222,139 
Accrued payroll and related   1,613,286    1,581,557 
Accrued player's club points and progressive jackpots   1,530,605    1,993,537 
Total current liabilities 4,316,489  4,797,233 
Long-term debt   6,740,000    7,350,000 
Other long-term  liabilities   556,993    570,717 
Total liabilities 11,613,482  12,717,950 
       
Stockholders' equity:      
Common stock, $0.12 par value per share; 50,000,000 shares authorized; 17,307,706 and 17,134,928 shares issued and 16,524,869 and 16,352,091 shares outstanding at October 31, 2015, and April 30, 2015, respectively  2,076,933  2,056,200 
Additional paid-in capital 25,119,286  24,845,094 
Retained earnings 11,531,789  10,455,804 
Treasury stock, 782,837 shares at October 31, 2015 and April 30, 2015, respectively, at cost   (6,932,035)   (6,932,035)
Total stockholders' equity 31,795,973  30,425,063 
Total liabilities and stockholders' equity$   43,409,455  $   43,143,013  
       



 

Contacts:

Nevada Gold & Casinos, Inc.

Michael P. Shaunnessy / James Meier

(702) 685-1000

Stonegate Capital Partners

Casey Stegman

(214) 987-4121

Source: Nevada Gold & Casinos Ltd.

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