Boyd Gaming Reports First-Quarter Results

LAS VEGAS, April 24, 2013 /PRNewswire/ -- Boyd Gaming Corporation (NYSE: BYD) today reported financial results for the first quarter ended March 31, 2013.  

(Logo: http://photos.prnewswire.com/prnh/20030219/BOYDLOGO)

Boyd Gaming reported net revenues of $737.0 million, an increase of 16.4% from $633.1 million during the same quarter in 2012.  Total Adjusted EBITDA(1) increased 22.2% to $163.5 million, compared to $133.8 million in the year-ago quarter.  Results reflect the addition of the operations of Peninsula Gaming, LLC, acquired by the Company on November 20, 2012.

Boyd Gaming's wholly-owned business reported first-quarter 2013 net revenues of $569.9 million, up 25.1% from $455.5 million in the year-ago period.  Wholly-owned Adjusted EBITDA was $135.1 million, an increase of 42.3% from $94.9 million in the first quarter of 2012.  Borgata, the Company's 50% joint venture, reported first-quarter 2013 net revenues of $165.6 million, compared to $176.2 million in the year-ago period, while Adjusted EBITDA was $28.4 million, down from $38.9 million in the first quarter of 2012. 

Adjusted Earnings(1) for the first quarter 2013 were $0.4 million, or $0.01 per share, compared $8.4 million, or $0.10 per share, for the same period in 2012.   The calculations of Adjusted Earnings and Adjusted Earnings per share are presented in a table at the end of this press release.

On a GAAP basis, the Company reported a net loss of $7.3 million, or $0.08 per share, for the first quarter 2013, compared to net income of $5.9 million, or $0.07 per share, for the year-ago period.

"We saw positive momentum across our operations in March, driving first-quarter results that were ahead of our previous expectations. We were particularly encouraged by improvements in our Las Vegas Locals business, as we were able to generate EBITDA growth for the first time in more than a year," said Keith Smith, President and Chief Executive Officer of Boyd Gaming.  "As we look forward, we are excited by the potential of our online gaming strategy.  New Jersey and Nevada are now laying the regulatory groundwork for online gaming, and other states are considering legalization as well.  This emerging business provides a compelling opportunity to significantly grow and diversify our business, and we intend to take full advantage of it."

(1)

See footnotes at the end of the release for additional information relative to non-GAAP financial measures.

Key Operations Review

Las Vegas Locals

In the Las Vegas Locals segment, first-quarter 2013 net revenues were $152.8 million compared to $154.8 million in the first quarter of 2012.  First-quarter 2013 Adjusted EBITDA was $39.2 million, up from $38.5 million in the year-ago period.  Our new slot initiatives and associated marketing programs continued to perform well during the quarter, while EBITDA benefited from improved operating margins.

Downtown

The Downtown Las Vegas region reported net revenues of $54.1 million for the first quarter of 2013, down from $57.0 million in the year-ago period. Adjusted EBITDA was $7.1 million, compared to $8.4 million in the first quarter of 2012.  Declines were the result of softness in business volumes early in the quarter.

Midwest and South

In the Midwest and South region, net revenues were $229.1 million, compared to $243.7 million in the first quarter of 2012.  Adjusted EBITDA was $49.7 million versus $58.1 million in the year-ago period.  Winter weather impacted business levels early in the quarter.  However, trends began to improve across the region in March.

Peninsula

During our first full quarter of ownership, the five Peninsula Gaming properties contributed net revenues of $133.9 million, and Adjusted EBITDA of $50.7 million.  The Peninsula properties performed in line with our expectations, including the Kansas Star, which opened a permanent casino and five new food and beverage outlets in late December.

Borgata

Borgata, the Company's 50% joint venture, reported first-quarter 2013 net revenues of $165.6 million, compared to $176.2 million in the year-ago period. Adjusted EBITDA was $28.4 million, down from $38.9 million in the first quarter of 2012.  Borgata significantly outperformed the Atlantic City market in slot, table game and poker revenue, further increasing its leading market share as the region continued to recover from the impact of Superstorm Sandy. 

Conference Call Information

Boyd Gaming will host its first-quarter 2013 conference call today, April 24, at 12:00 p.m. Eastern, on which the Company will provide guidance for the second quarter 2013.  The conference call number is (888) 317-6003, passcode 2086018.  Please call up to 15 minutes in advance to ensure you are connected prior to the start of the call. 

The conference call will also be available live on the Internet at www.boydgaming.com, or:  http://www.videonewswire.com/event.asp?id=93589

Following the call's completion, a replay will be available by dialing (877) 344-7529 today, April 24, beginning at 2:00 p.m. Eastern and continuing through Thursday, May 2, at 9 a.m. Eastern.  The conference number for the replay will be 10027939.  The replay will also be available on the Internet at www.boydgaming.com.

 

BOYD GAMING CORPORATION
Condensed Consolidated Statements of Operations
(Unaudited)



Three Months Ended


March 31,

(In thousands, except per share data)

2013


2012

Revenues




  Gaming

$ 633,767


$ 535,748

  Food and beverage

111,864


106,132

  Room

63,855


65,997

  Other

39,420


35,832

Gross revenues

848,906


743,709

Less promotional allowances

111,923


110,626

     Net revenues

736,983


633,083





Costs and expenses




  Gaming

298,409


248,955

  Food and beverage

60,167


54,078

  Room

13,100


14,135

  Other

28,221


26,061

  Selling, general and administrative

124,905


109,717

  Maintenance and utilities

39,353


38,763

  Depreciation and amortization

70,071


50,014

  Corporate expense

15,356


12,871

  Preopening expenses

2,365


1,660

  Asset transactions costs

3,013


45

  Other operating charges, net

1,566


202

  Total costs and expenses

656,526


556,501

Operating income

80,457


76,582





Other expense (income)




  Interest income

(656)


(4)

  Interest expense, net of amounts capitalized

95,682


63,828

  Other, net

(518)


     Total other expense, net

94,508


63,824





Income (loss) before income taxes

(14,051)


12,758

  Income taxes

2,424


(6,283)

Net income (loss)

(11,627)


6,475

  Net (income) loss attributable to noncontrolling
   interest

4,343


(623)

Net income (loss) attributable to Boyd
  Gaming Corporation

$   (7,284)


$     5,852





Basic net income (loss) per common share

$     (0.08)


$       0.07





  Weighted average basic shares outstanding

87,974


87,530





Diluted net income (loss) per common share

$     (0.08)


$       0.07





  Weighted average diluted shares outstanding

87,974


87,987

 

 

BOYD GAMING CORPORATION
SUPPLEMENTAL INFORMATION
Reconciliation of Adjusted EBITDA to Operating Income (Loss)
(Unaudited)



Three Months Ended


March 31,

(In thousands)

2013


2012

Net Revenues by Reportable Segment




  Las Vegas Locals

$              152,827


$              154,789

  Downtown Las Vegas

54,083


57,008

  Midwest and South

229,117


243,722

  Peninsula Gaming (1)

133,913


  Atlantic City

165,644


176,150

  Reportable Segment Net revenues

735,584


631,669

  Other

1,399


1,414

  Net revenues

$              736,983


$              633,083





Adjusted EBITDA by Reportable Segment




  Las Vegas Locals

$                39,205


$                38,486

  Downtown Las Vegas

7,111


8,432

  Midwest and South

49,682


58,130

  Peninsula Gaming (1)

50,712


  Wholly owned property Adjusted EBITDA

146,710


105,048

  Corporate expense (2)

(11,638)


(10,127)

  Wholly owned Adjusted EBITDA

135,072


94,921

  Atlantic City

28,405


38,881

  Adjusted EBITDA

163,477


133,802





Other operating costs and expenses




  Deferred rent

957


996

  Depreciation and amortization

70,071


50,014

  Preopening expenses

2,365


1,660

  Share-based compensation expense

4,091


3,116

  Asset transactions costs

3,013


45

  Other charges, net

2,523


1,389

  Total other operating costs and expenses

83,020


57,220

Operating income

80,457


76,582

Other non-operating items




  Interest expense, net

95,026


63,824

  Other income

(518)


    Total other non-operating costs and expenses, net

94,508


63,824

Income (loss) before income taxes

(14,051)


12,758

  Income taxes

2,424


(6,283)

Net income (loss)

(11,627)


6,475

  Net (income) loss attributable to noncontrolling interest

4,343


(623)

Net income (loss) attributable to Boyd Gaming Corporation

$                (7,284)


$                  5,852

______________________________________




   (1) Peninsula Gaming was acquired on November 20, 2012

   (2) Reconciliation of corporate expense:









Three Months Ended


March 31,

(In thousands)

2013


2012

Corporate expense as reported on Condensed
   Consolidated Statements of Operations

$                15,356


$                12,871

Corporate share-based compensation expense

(3,718)


(2,744)

Corporate expense as reported on the above table

$                11,638


$                10,127

 

 BOYD GAMING CORPORATION

SUPPLEMENTAL INFORMATION

Reconciliation of Net Income (Loss) to Adjusted Earnings (Loss) and

Net Income (Loss) Per Share to Adjusted Earnings (Loss) Per Share

(Unaudited)



Three Months Ended


March 31,


2013


2012

(In thousands, except per share data)






Net income (loss) attributable to Boyd Gaming
   Corporation

$ (7,284)


$  5,852

   Pretax adjustments related to Boyd Gaming:




  Preopening expenses, excluding impact of LVE

4,298


4,252

  Asset transactions costs

2,679


73

  Adjustments to property tax accruals, net


(597)

  Other operating charges, net

1,566


202

     Other non-operating expense (income)

(817)






Pretax adjustments related to Borgata:




Preopening expenses


132

Valuation adjustments related to consolidation, net

(259)


(19)

    Asset transactions costs

334


(25)

Total adjustments

7,801


4,018





Income tax effect for above adjustments

(31)


(1,410)

Impact on noncontrolling interest, net

(38)


(44)

Adjusted earnings (loss)

$     448


$  8,416









Net income (loss) per share

$   (0.08)


$    0.07

Pretax adjustments related to Boyd Gaming:




Preopening expenses, excluding impact of LVE

0.05


0.05

Asset transactions costs

0.03


Adjustments to property tax accruals, net


(0.01)

Other operating charges, net

0.02


Other income

(0.01)






Pretax adjustments related to Borgata:




Preopening expenses


Valuation adjustments related to consolidation, net


Asset transactions costs


Total adjustments

0.09


0.04





Income tax effect for above adjustments


(0.02)

Impact on noncontrolling interest, net


0.01

Adjusted earnings (loss)

$    0.01


$    0.10





Weighted average shares outstanding

88,354


87,987

 

 

BOYD GAMING CORPORATION
SUPPLEMENTAL INFORMATION
Condensed Consolidating Statement of Operations
Three Months Ended March 31, 2013
(Unaudited)

(In Thousands, except per share data)



Boyd Gaming Wholly Owned










Excluding Peninsula Gaming


Peninsula Gaming


Eliminations


Total


Borgata (1)


LVE (Variable Interest Entity) (2)


Eliminations


Boyd Gaming Consolidated