Segment Information

3 Months Ended

Mar. 31, 2020

14.SEGMENT INFORMATION

The Company reports its financial performance in three reportable segments based on the geographical locations in which its casinos operate: the United States, Canada and Poland. The Company views each market in which it operates as a separate operating segment and each casino within those markets as a reporting unit. Operating segments are aggregated within reportable segments based on their similar economic characteristics, types of customers, types of services and products provided, the regulatory environments in which they operate, and their management and reporting structure. The Company’s operations related to Century Casino Bath, its concession, management and consulting agreements and certain other corporate and management operations have not been identified as separate reportable segments; therefore, these operations are included in Corporate and Other in the following segment disclosures to reconcile to consolidated results. All intercompany transactions are eliminated in consolidation.

The table below provides information about the aggregation of the Company’s reporting units and operating segments into reportable segments:


Reportable Segment	Operating Segment	Reporting Unit
United States	Colorado	Century Casino & Hotel - Central City
		Century Casino & Hotel - Cripple Creek
	West Virginia	Mountaineer Casino, Racetrack & Resort
	Missouri	Century Casino Cape Girardeau
		Century Casino Caruthersville
Canada	Edmonton	Century Casino & Hotel - Edmonton
		Century Casino St. Albert
		Century Mile Racetrack and Casino
	Calgary	Century Casino Calgary
		Century Downs Racetrack and Casino
		Century Bets! Inc.
Poland	Poland	Casinos Poland
Corporate and Other	Corporate and Other	Cruise Ships & Other
		Century Casino Bath
		Corporate Other

The Company’s chief operating decision maker is a management function comprised of two individuals. These two individuals are the Company’s Co-Chief Executive Officers. The Company’s chief operating decision makers and management utilize Adjusted EBITDA as the primary profit measure for its reportable segments. Adjusted EBITDA is a non-US GAAP measure defined as net earnings (loss) attributable to Century Casinos, Inc. shareholders before interest expense (income), net, income taxes (benefit), depreciation, amortization, non-controlling interest (earnings) losses and transactions, pre-opening expenses, acquisition costs, non-cash stock-based compensation charges, asset impairment costs, (gain) loss on disposition of fixed assets, discontinued operations, (gain) loss on foreign currency transactions and other, gain on business combination and certain other one-time transactions. Expense related to the Master Lease is included in the interest expense (income), net line item. Intercompany transactions consisting primarily of management and royalty fees and interest, along with their related tax effects, are excluded from the presentation of net earnings (loss) and Adjusted EBITDA reported for each segment. Non-cash stock-based compensation expense is presented under Corporate and Other in the tables below as the expense is not allocated to reportable segments when reviewed by the Company’s chief operating decision makers.

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The following tables provide information regarding the Company’s segments:


	For the three months ended March 31, 2020
Amounts in thousands		United States		Canada		Poland		Corporate and Other		Total
Net operating revenue ⁽¹⁾		$	53,427	$	16,187	$	17,062	$	980	$	87,656

(Loss) earnings before income taxes		$	(32,372)	$	(2,157)	$	91	$	(8,699)	$	(43,137)

Net (loss) earnings attributable to Century Casinos, Inc. shareholders		$	(34,219)	$	(4,408)	$	31	$	(7,260)	$	(45,856)
Interest expense (income), net ⁽²⁾			7,281		543		31		3,511		11,366
Income taxes (benefit)			1,847		2,071		45		(1,439)		2,524
Depreciation and amortization			4,259		1,337		763		136		6,495
Net earnings attributable to non-controlling interests			—		180		15		—		195
Non-cash stock-based compensation			—		—		—		(14)		(14)
Loss on foreign currency transactions, cost recovery income and other			29,589		3,311		172		1,645		34,717
Loss on disposition of fixed assets			—		—		2		2		4
Acquisition costs			—		—		—		213		213
Adjusted EBITDA		$	8,757	$	3,034	$	1,059	$	(3,206)	$	9,644

(1)Net operating revenue for Corporate and Other primarily relates to CCB and the Company’s cruise ship operations.

(2)Expense of $7.3 million related to the Master Lease is included in interest expense (income), net in the United States segment. Expense of $0.5 million related to the CDR land lease is included in interest expense (income), net in the Canada segment. Cash payments related to the Master Lease and CDR land lease were $6.2 million and $0.5 million, respectively, for the period presented.


	For the three months ended March 31, 2019
Amounts in thousands		United States		Canada		Poland		Corporate and Other		Total
Net operating revenue ⁽¹⁾		$	8,068	$	16,297	$	19,752	$	1,496	$	45,613

Earnings (loss) before income taxes		$	1,339	$	2,553	$	1,831	$	(3,284)	$	2,439

Net earnings (loss) attributable to Century Casinos, Inc. shareholders		$	983	$	1,547	$	913	$	(2,375)	$	1,068
Interest expense (income), net (2)			—		1,192		46		16		1,254
Income taxes (benefit)			356		766		461		(867)		716
Depreciation and amortization			560		797		770		298		2,425
Net earnings (loss) attributable to non-controlling interests			—		240		457		(42)		655
Non-cash stock-based compensation			—		—		—		261		261
Gain on foreign currency transactions and cost recovery income			—		(45)		(202)		(11)		(258)
Loss (gain) on disposition of fixed assets			16		(5)		5		28		44
Pre-opening expenses			—		538		—		—		538
Adjusted EBITDA		$	1,915	$	5,030	$	2,450	$	(2,692)	$	6,703

(1)Net operating revenue for Corporate and Other primarily relates to the Company’s cruise ship operations.

(2)Expense of $0.5 million related to the CDR land lease is included in interest expense (income), net in the Canada segment. Cash payments related to the CDR land lease were $0.5 million for the period presented.

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