Station Casinos releases second quarter results
12 Aug 2015
“We are pleased to report another solid quarter, as net revenues increased 5.0% and Adjusted EBITDAM increased 10.1% compared to the prior year period.”
Second Quarter Highlights
—Net revenues increased 5.0% and Adjusted EBITDAM increased 10.1% compared to the prior year period.
—Adjusted EBITDAM margin increased 160 basis points to 34.0% compared to the prior year period.
—Ninth consecutive quarter of year-over-year net revenue growth and seventeenth consecutive quarter of year-over-year Adjusted EBITDAM growth.
—Net revenues at our Las Vegas properties increased 4.0% and Las Vegas Adjusted EBITDAM increased 7.1% compared to the prior year period.
—Native American management fees contributed $14.4 million to Adjusted EBITDAM, an increase of 33% compared to the prior year period.
"We are pleased to report another solid quarter, as net revenues increased 5.0% and Adjusted EBITDAM increased 10.1% compared to the prior year period,” said Marc Falcone, Executive Vice President, Chief Financial Officer and Treasurer. “Our continued revenue growth in the second quarter was driven by strong demand across all areas of our business. In addition, our ongoing ability to leverage operational efficiencies allowed us to post our eleventh consecutive quarter of year-over-year improvement in Adjusted EBITDAM margin.”
Consolidated Results of Operations
The Company's consolidated net revenues for the second quarter ended June 30, 2015 were $337.8 million, an increase of $16.1 million, or 5.0%, compared to the prior year period. Consolidated Adjusted EBITDAM for the quarter increased $10.5 million, or 10.1%, to $114.9 million compared to the prior year period, and Adjusted EBITDAM margin increased 160 basis points to 34.0%. Our Las Vegas properties recorded a 4.0% increase in net revenues, a 7.1% increase in Adjusted EBITDAM and a 100 basis points increase in Adjusted EBITDAM margin to 32.3%. In Las Vegas, we experienced continued growth in both gaming and non-gaming areas with a 3.6% increase in casino revenue, a 5.6% increase in food and beverage revenue and an 8.2% increase in hotel revenue. Results from the two Native American properties managed by the Company were also strong, as management fees increased by 33% to $14.4 million.
Year-to-date through June 30, 2015, the Company’s consolidated net revenues were $680.6 million, a 5.0% increase compared to the first six months of 2014. Adjusted EBITDAM was $239.6 million for the six months, a $24.3 million, or 11.3%, increase compared to the prior year and Adjusted EBITDAM margin increased 200 basis points to 35.2%. Native American management fees increased $6.0 million to $28.8 million for the six months ended June 30, 2015.
"Our second quarter financial results reflect the ongoing improvement of the Las Vegas economy. Job growth, population growth, housing prices and consumer confidence all continued to head in the right direction. Improvement in the local economy, combined with our strong operating leverage, led to our Las Vegas properties reporting the strongest second quarter Adjusted EBITDAM since 2008 and a 40% improvement in our second quarter Adjusted EBITDAM when compared to the trough in the second quarter of 2010," Falcone stated.
Adjusted EBITDAM is not a generally accepted accounting principle (“GAAP”) measurement and is presented solely as a supplemental disclosure because the Company believes that it is a widely used measure of operating performance in the gaming industry and is a principal basis for valuation of gaming companies. Adjusted EBITDAM is further defined in footnote 1.
Balance Sheet Highlights
As of June 30, 2015, the outstanding principal balance of the Company’s long-term debt was $2.0 billion (excluding a non-recourse land loan of $114.0 million) and cash and cash equivalents were $113.8 million. As of June 30, our debt (net of excess cash) to Adjusted EBITDAM ratio was 4.5 times, excluding the non-recourse land loan.
Conference Call Information
The Company will host a conference call on August 11, 2015 at 1:30 p.m. Pacific Time to discuss its second quarter 2015 financial results. The conference call will consist of prepared remarks from the Company and will include a question and answer session. Those interested in participating in the call should dial (877) 869-3847 or (201) 689-8261 for international callers, approximately 15 minutes before the call start time. A replay of the call will be available from August 11, 2015 through August 18, 2015 at https://www.sclv.com/Investor-Relations.aspx. A live audio webcast of the call will also be available at the Station Casinos website.