Delaware | 001-32583 | 13-3391527 | ||
(State or other jurisdiction of incorporation) | (Commission File Number) | (I.R.S. Employer Identification No.) |
One Summerlin 1980 Festival Plaza Drive, Suite 680 Las Vegas, Nevada | 89135 | |
(Address of principal executive offices) | (Zip Code) |
N/A | ||
(Former name or former address, if changed since last report) |
o | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
o | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
o | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
o | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||
Common stock, $0.0001 par value per share | FLL | The Nasdaq Stock Market LLC |
(d) | Exhibits | ||
No. | Description | ||
99.1 |
Full House Resorts, Inc. | ||
Date: August 8, 2019 | /s/ Lewis A. Fanger | |
Lewis A. Fanger, Senior Vice President, Chief Financial Officer & Treasurer |
• | Net revenues at Silver Slipper Casino and Hotel grew 8.0% in the second quarter of 2019 to $18.9 million and Adjusted Property EBITDA rose 12.9% to $3.6 million. In May 2019, we completed a substantial renovation of Silver Slipper, including replacement of the casino's carpet, as well as the wall coverings and seating areas throughout the buffet. Silver Slipper achieved growth during the second quarter despite temporary disruption from the renovation. Results in April and June were amongst the best months in the casino's history. For the first half of 2019, Silver Slipper's net revenues and Adjusted Property EBITDA rose 12.3% and 22.7%, respectively, over the prior-year period. |
• | At Rising Star Casino Resort, net revenues declined for the second quarter of 2019 to $11.6 million from $12.5 million. Adjusted Property EBITDA of $0.6 million in the second quarter of 2019 compares to $0.8 million in the prior-year period. As mentioned last quarter, the Indiana Department of Transportation began repaving Highway 50, the key road leading to the property, frequently causing traffic delays. That road construction continued to adversely affect operations during the second quarter of 2019. To help offset this, the Company made its new ferry service free, beginning in May. The ferry service showed meaningful increases in usage during the quarter, as well as record usage in July 2019. For example, weekday usage of the ferry boat in July grew 69% versus June, and weekend traffic has increased 56% versus June. As a result of the increased ferry traffic, management has decided to continue to operate the ferry on a free basis, believing the increased traffic is more important to the casino than the ferry revenue. |
• | Additionally regarding Rising Star, new gaming legislation became effective in Indiana in May 2019. This new legislation contained several items beneficial to Rising Star, including: |
◦ | The approval of sports wagering at Indiana casinos. We expect to open an on-site sportsbook at Rising Star in the fall, in conjunction with a partner with unique expertise in sportsbook operations. |
◦ | The approval of three mobile "skins" for each casino license. In addition to an on-site sportsbook, the new legislation allows for three mobile "skins" (the industry term for website) for each casino license in the state. Effectively, these "skins" will allow Rising Star to partner with three website brands for online sports wagering via the Internet, regardless of location within the state. Online gaming must be paired with a physical casino, even though customers do not have to be physically in that casino to place a bet. Online sports wagering is expected to go live in Indiana within the next few months. |
◦ | The reduction of certain gaming taxes. The new gaming legislation approved a reduction in certain gaming taxes for casino operators in the state, including Rising Star, beginning on July 1, 2021. |
◦ | A potential new casino located in Terre Haute. The gaming legislation called for a competitive process for a new casino in Terre Haute, pending local voter approval. Such casino should have little or no impact on Rising Star and the Company is evaluating whether to pursue the potential expansion opportunity. |
• | At Bronco Billy's Casino and Hotel, net revenues for the second quarter of 2019 grew 1.2% to $6.9 million from $6.8 million. Adjusted Property EBITDA was $0.9 million and $1.3 million for the second quarters of 2019 and 2018, respectively. Operating expenses increased primarily due to additional costs related to operating the Christmas Casino & Inn, as well as transition costs related to management changes at the property. Operating results also reflect increased marketing activities and an increase to the state’s minimum wage that went into effect on January 1, 2019. |
• | As mentioned above, the Company is preparing for the launch of sports wagering at Colorado's casinos. During the second quarter, legislators in Colorado approved sports wagering, subject to statewide voter approval. In addition to on-site sports wagering, the new gaming legislation also allows Internet sports wagering via one mobile "skin" per casino license. In Colorado, the Company has three casino licenses, the maximum allowed for a single company operating in the state. Accordingly, assuming voters approve sports wagering in the November election, the Company expects to partner on three Internet sports wagering sites in Colorado, in addition to an on-site sportsbook, with operations beginning in mid-2020. |
• | The Company also recently began construction of its new parking garage at Bronco Billy's, the major component of the property's Phase One expansion. Phase One includes significant utility relocations; a back-of-house service building, located between the garage and the casino; and pedestrian entrances directly from the garage into the casino. The Company expects to complete the parking garage and related structures in the first half of 2020. Additionally, the Company continues to finalize its plans for the significant Phase Two expansion at Bronco Billy's. Phase Two is expected to include a new luxury hotel tower, spa, convention and entertainment center, two new restaurants, and a significant upgrade to the Bronco Billy's casino. Both the new parking garage and the Phase Two expansion will integrate seamlessly with the existing casino. The Company has the funding in place for completion of Phase One and is evaluating its funding alternatives for Phase Two. For renderings of the proposed expansion, as well as a presentation discussing the Company's analysis of the Cripple Creek market, please visit the investor section of www.fullhouseresorts.com and click on "News and Events/Presentations." |
• | The Northern Nevada segment consists of the Grand Lodge and Stockman’s casinos. Combined, Northern Nevada net revenues were $4.3 million and $4.4 million for the second quarters of 2019 and 2018, respectively. Adjusted Property EBITDA for the Northern Nevada segment was $417,000 and $473,000 for the same periods, respectively. Grand Lodge Casino had a lingering heavy snowpack that impeded spring and early summer activities at Lake Tahoe. At Stockman’s Casino, visitor activity at the nearby military base appeared to be below prior-year levels, though improving as the quarter progressed. |
• | On August 5, 2019, the Company submitted a proposal to construct and operate American Place, a new casino and resort destination in Waukegan, Illinois, approximately 35 miles north of downtown Chicago. This proposal was in response to a "Request for Qualifications and Proposals" published by the City of Waukegan to select a preferred operator per the recent legislation expanding gaming in Illinois. If selected, Full House intends to build a casino with approximately 1,500 slot machines, 60 table games, and a very high-end boutique hotel. For further information about American Place, please visit www.americanplace.us. |
• | The Company maintains a Facebook page to provide work-in-progress photos to investors of our various growth projects and other activities. To access that Facebook page, please visit www.facebook.com/FHResorts. |
FULL HOUSE RESORTS, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) (In thousands, except per share data) | |||||||||||||||
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
2019 | 2018 | 2019 | 2018 | ||||||||||||
Revenues | |||||||||||||||
Casino | $ | 28,450 | $ | 28,632 | $ | 56,748 | $ | 55,602 | |||||||
Food and beverage | 8,863 | 8,783 | 17,521 | 16,722 | |||||||||||
Hotel | 3,051 | 2,582 | 5,766 | 4,865 | |||||||||||
Other operations | 1,299 | 1,230 | 2,122 | 1,969 | |||||||||||
Net revenues | 41,663 | 41,227 | 82,157 | 79,158 | |||||||||||
Operating costs and expenses | |||||||||||||||
Casino | 11,592 | 11,282 | 23,377 | 22,366 | |||||||||||
Food and beverage | 9,449 | 9,757 | 18,818 | 18,883 | |||||||||||
Hotel | 2,379 | 2,652 | 4,799 | 5,139 | |||||||||||
Other operations | 1,072 | 834 | 1,841 | 1,348 | |||||||||||
Selling, general and administrative | 13,027 | 12,462 | 25,687 | 24,424 | |||||||||||
Project development and acquisition costs | 142 | 130 | 275 | 167 | |||||||||||
Depreciation and amortization | 2,083 | 2,038 | 4,174 | 4,206 | |||||||||||
(Gain) loss on sale or disposal of assets, net | (4 | ) | 69 | (5 | ) | 79 | |||||||||
39,740 | 39,224 | 78,966 | 76,612 | ||||||||||||
Operating income | 1,923 | 2,003 | 3,191 | 2,546 | |||||||||||
Other (expense) income | |||||||||||||||
Interest expense, net of capitalized interest | (2,931 | ) | (2,466 | ) | (5,634 | ) | (5,006 | ) | |||||||
Loss on extinguishment of debt | — | — | — | (2,673 | ) | ||||||||||
Adjustment to fair value of warrants | 141 | (80 | ) | 101 | 423 | ||||||||||
(2,790 | ) | (2,546 | ) | (5,533 | ) | (7,256 | ) | ||||||||
Loss before income taxes | (867 | ) | (543 | ) | (2,342 | ) | (4,710 | ) | |||||||
Provision for income taxes | 143 | 118 | 285 | 237 | |||||||||||
Net loss | $ | (1,010 | ) | $ | (661 | ) | $ | (2,627 | ) | $ | (4,947 | ) | |||
Basic loss per share | $ | (0.04 | ) | $ | (0.02 | ) | $ | (0.10 | ) | $ | (0.20 | ) | |||
Diluted loss per share | $ | (0.04 | ) | $ | (0.02 | ) | $ | (0.10 | ) | $ | (0.21 | ) |
Three Months Ended | Six Months Ended | ||||||||||||||
June 30, | June 30, | ||||||||||||||
2019 | 2018 | 2019 | 2018 | ||||||||||||
Net Revenues | |||||||||||||||
Silver Slipper Casino and Hotel | $ | 18,892 | $ | 17,492 | $ | 38,174 | $ | 34,001 | |||||||
Rising Star Casino Resort | 11,598 | 12,528 | 22,465 | 23,755 | |||||||||||
Bronco Billy's Casino and Hotel | 6,877 | 6,795 | 13,317 | 13,037 | |||||||||||
Northern Nevada Casinos | 4,296 | 4,412 | 8,201 | 8,365 | |||||||||||
$ | 41,663 | $ | 41,227 | $ | 82,157 | $ | 79,158 | ||||||||
Adjusted Property EBITDA(1) and Adjusted EBITDA | |||||||||||||||
Silver Slipper Casino and Hotel | $ | 3,594 | $ | 3,183 | $ | 7,440 | $ | 6,066 | |||||||
Rising Star Casino Resort | 604 | 776 | 1,007 | 1,269 | |||||||||||
Bronco Billy's Casino and Hotel | 876 | 1,256 | 1,491 | 1,961 | |||||||||||
Northern Nevada Casinos | 417 | 473 | 408 | 460 | |||||||||||
Adjusted Property EBITDA | 5,491 | 5,688 | 10,346 | 9,756 | |||||||||||
Corporate | (1,240 | ) | (1,273 | ) | (2,518 | ) | (2,351 | ) | |||||||
Adjusted EBITDA | $ | 4,251 | $ | 4,415 | $ | 7,828 | $ | 7,405 |
(1) | The Company utilizes Adjusted Property EBITDA as the measure of segment operating profit in assessing performance and allocating resources at the reportable segment level. |
(In thousands) | Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||
2019 | 2018 | 2019 | 2018 | ||||||||||||
Net loss | $ | (1,010 | ) | $ | (661 | ) | $ | (2,627 | ) | $ | (4,947 | ) | |||
Provision for income taxes | 143 | 118 | 285 | 237 | |||||||||||
Interest expense, net of amounts capitalized | 2,931 | 2,466 | 5,634 | 5,006 | |||||||||||
Loss on extinguishment of debt | — | — | — | 2,673 | |||||||||||
Adjustment to fair value of warrants | (141 | ) | 80 | (101 | ) | (423 | ) | ||||||||
Operating income | 1,923 | 2,003 | 3,191 | 2,546 | |||||||||||
Project development and acquisition costs | 142 | 130 | 275 | 167 | |||||||||||
Depreciation and amortization | 2,083 | 2,038 | 4,174 | 4,206 | |||||||||||
(Gain) loss on sale or disposal of assets, net | (4 | ) | 69 | (5 | ) | 79 | |||||||||
Stock-based compensation | 107 | 175 | 193 | 407 | |||||||||||
Adjusted EBITDA | $ | 4,251 | $ | 4,415 | $ | 7,828 | $ | 7,405 |
Three Months Ended June 30, 2019 | |||||||||||||||||||||||
Operating Income (Loss) | Depreciation and Amortization | Gain on Sale of Assets | Project Development and Acquisition Costs | Share-Based Compensation | Adjusted Property EBITDA and Adjusted EBITDA | ||||||||||||||||||
Casino properties | |||||||||||||||||||||||
Silver Slipper Casino and Hotel | $ | 2,725 | $ | 869 | $ | — | $ | — | $ | — | $ | 3,594 | |||||||||||
Rising Star Casino Resort | 11 | 593 | — | — | — | 604 | |||||||||||||||||
Bronco Billy’s Casino and Hotel | 446 | 434 | (4 | ) | — | — | 876 | ||||||||||||||||
Northern Nevada Casinos | 268 | 149 | — | — | — | 417 | |||||||||||||||||
3,450 | 2,045 | (4 | ) | — | — | 5,491 | |||||||||||||||||
Other operations | |||||||||||||||||||||||
Corporate | (1,527 | ) | 38 | — | 142 | 107 | (1,240 | ) | |||||||||||||||
$ | 1,923 | $ | 2,083 | $ | (4 | ) | $ | 142 | $ | 107 | $ | 4,251 |
Three Months Ended June 30, 2018 | |||||||||||||||||||||||
Operating Income (Loss) | Depreciation and Amortization | Loss on Disposal of Assets | Project Development and Acquisition Costs | Share-Based Compensation | Adjusted Property EBITDA and Adjusted EBITDA | ||||||||||||||||||
Casino properties | |||||||||||||||||||||||
Silver Slipper Casino and Hotel | $ | 2,372 | $ | 811 | $ | — | $ | — | $ | — | $ | 3,183 | |||||||||||
Rising Star Casino Resort | 172 | 603 | 1 | — | — | 776 | |||||||||||||||||
Bronco Billy’s Casino and Hotel | 811 | 377 | 68 | — | — | 1,256 | |||||||||||||||||
Northern Nevada Casinos | 265 | 208 | — | — | — | 473 | |||||||||||||||||
3,620 | 1,999 | 69 | — | — | 5,688 | ||||||||||||||||||
Other operations | |||||||||||||||||||||||
Corporate | (1,617 | ) | 39 | — | 130 | 175 | (1,273 | ) | |||||||||||||||
$ | 2,003 | $ | 2,038 | $ | 69 | $ | 130 | $ | 175 | $ | 4,415 |
Six Months Ended June 30, 2019 | |||||||||||||||||||||||
Operating Income (Loss) | Depreciation and Amortization | Gain on Sale of Assets | Project Development and Acquisition Costs | Share-Based Compensation | Adjusted Property EBITDA and Adjusted EBITDA | ||||||||||||||||||
Casino properties | |||||||||||||||||||||||
Silver Slipper Casino and Hotel | $ | 5,725 | $ | 1,716 | $ | (1 | ) | $ | — | $ | — | $ | 7,440 | ||||||||||
Rising Star Casino Resort | (192 | ) | 1,199 | — | — | — | 1,007 | ||||||||||||||||
Bronco Billy’s Casino and Hotel | 614 | 881 | (4 | ) | — | — | 1,491 | ||||||||||||||||
Northern Nevada Casinos | 106 | 302 | — | — | — | 408 | |||||||||||||||||
6,253 | 4,098 | (5 | ) | — | — | 10,346 | |||||||||||||||||
Other operations | |||||||||||||||||||||||
Corporate | (3,062 | ) | 76 | — | 275 | 193 | (2,518 | ) | |||||||||||||||
$ | 3,191 | $ | 4,174 | $ | (5 | ) | $ | 275 | $ | 193 | $ | 7,828 |
Six Months Ended June 30, 2018 | |||||||||||||||||||||||
Operating Income (Loss) | Depreciation and Amortization | Loss on Disposal of Assets | Project Development and Acquisition Costs | Share-Based Compensation | Adjusted Property EBITDA and Adjusted EBITDA | ||||||||||||||||||
Casino properties | |||||||||||||||||||||||
Silver Slipper Casino and Hotel | $ | 4,434 | $ | 1,631 | $ | 1 | $ | — | $ | — | $ | 6,066 | |||||||||||
Rising Star Casino Resort | 28 | 1,232 | 9 | — | — | 1,269 | |||||||||||||||||
Bronco Billy’s Casino and Hotel | 1,043 | 849 | 69 | — | — | 1,961 | |||||||||||||||||
Northern Nevada Casinos | 44 | 416 | — | — | — | 460 | |||||||||||||||||
5,549 | 4,128 | 79 | — | — | 9,756 | ||||||||||||||||||
Other operations | |||||||||||||||||||||||
Corporate | (3,003 | ) | 78 | — | 167 | 407 | (2,351 | ) | |||||||||||||||
$ | 2,546 | $ | 4,206 | $ | 79 | $ | 167 | $ | 407 | $ | 7,405 |