LAS VEGAS, July 26, 2018 (GLOBE NEWSWIRE) -- Nevada Gold & Casinos, Inc. (NYSE MKT:UWN) today announced financial results for the fourth quarter and year ended April 30, 2018. The Company will host a conference call today at 4:30 PM ET (1:30 PM PT) to discuss these results and provide a corporate update.
The financial results reflect an adjustment related to progressive liabilities for $0.6 million in fiscal 2018 and $0.2 million in the prior year which reduced casino revenue and marketing expense equally with no effect on operating income. Of this adjustment, $0.1 million related to the fourth quarter of both 2018 and 2017.
FOURTH QUARTER
For the fourth quarter of fiscal 2018, the Company reported net revenues of $18.5 million compared to $19.8 million in the fourth quarter of fiscal 2017. Operating income was $0.6 million compared to $1.9 million in the prior year. Net income was $0.4 million, or $0.02 per share. Consolidated Adjusted EBITDA was $2.1 million compared to $2.6 million in the prior year period.
During the fourth quarter, net revenues from Washington state gaming operations decreased to $13.7 million from the $14.8 million in the prior year period, while EBITDA decreased to $2.1 million compared to $2.5 million in the prior year period. Club Fortune net revenues were $3.4 million compared to $3.7 million in the prior year period, while EBITDA decreased by $0.2 million to $0.5 million. South Dakota route operation revenues decreased $89,000 from the prior year period and EBITDA declined $11,000 for the quarter. Corporate expenses were approximately $0.6 million in both periods, excluding non-recurring sale transaction expenses.
FISCAL YEAR
For the fiscal year 2018, the Company reported net revenues of $74.6 million compared to $74.5 million in fiscal year 2017. Operating expenses were $72.0 million compared to $72.7 million in the prior year. Net income was $1.3 million compared to $0.6 million in the prior year.
Net revenues for the fiscal year from Washington state gaming operations increased to $54.4 million from $54.3 million, primarily due to increased Poker revenue. Higher wages and marketing expenses contributed to Adjusted EBITDA decreasing to $6.5 million from $7.0 million in the prior year. Club Fortune net revenues were $13.6 million and Adjusted EBITDA was $1.7 million compared to revenues of $13.5 million and Adjusted EBITDA of $1.5 million in the prior year. South Dakota route operation revenues decreased $0.1 million to $6.6 million while Adjusted EBITDA decreased to $0.1 million. We recorded a write down and other charges related to South Dakota of $0.4 million in the current year, compared to $1.1 million in the prior year. Corporate adjusted EBITDA was negative $2.3 million compared to negative $2.5 million in the prior year.
During the fiscal year the Company repaid $4.3 million in bank debt and as of April 30, 2018, the outstanding bank debt was $8.0 million and unrestricted cash on hand was $9.5 million. During the year ended April 30, 2018, the Company repurchased 788,301 shares at a weighted average price of $2.16 per share, costing $1,700,291. As of April 30, 2018, $1.7 million remains available under the share repurchase authorization.
STRATEGIC REVIEW
The Company’s Strategic Review is ongoing and has resulted to date in significant steps to restructure the Company’s operations. On June 30, 2018 the Company completed the sale of its South Dakota slot route operations and on June 27, 2018 executed a definitive agreement to sell the Club Fortune Casino in Henderson, Nevada for $14.6 million. The Company has previously announced that effective upon closure of the sale of Club Fortune casino, its corporate headquarters will relocate from Las Vegas to the Seattle, Washington area reducing corporate overhead by $1.2 million. At that time Victor Mena will succeed Michael Shaunnessy as President and Chief Executive Officer. Mr. Mena has led the operations in Washington since 2009.
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, exclusion of net income or loss from operations held for sale, 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.
Net income reconciliation to Adjusted EBITDA:
| For the three months ended | ||||||||
| April 30, 2018 | April 30, 2017 | |||||||
| Net income | $ | 367,121 | $ | 1,196,560 | ||||
| Adjustments: | ||||||||
| Net interest expense | 158,955 | 149,772 | ||||||
| Income tax expense | 134,930 | 578,237 | ||||||
| Depreciation and amortization | 522,261 | 714,652 | ||||||
| Write downs and other charges | 358,807 | - | ||||||
| Deferred rent amortization | 3,868 | 5,168 | ||||||
| Stock compensation amortization | 14,702 | 2,980 | ||||||
| Acquisition and sale related expenses | 589,839 | - | ||||||
| Increase in swap fair value | (37,575 | ) | (23,865 | ) | ||||
| Loss on disposal of assets | 2,090 | 20,693 | ||||||
| Adjusted EBITDA | $ | 2,114,998 | $ | 2,644,197 | ||||
| For the fiscal year ended | ||||||||
| April 30, 2018 | April 30, 2017 | |||||||
| Net income | $ | 1,323,425 | $ | 563,964 | ||||
| Adjustments: | ||||||||
| Net interest expense | 591,146 | 666,543 | ||||||
| Income tax expense | 853,426 | 790,829 | ||||||
| Depreciation and amortization | 2,370,752 | 3,021,280 | ||||||
| Acquisition and sale related expenses | 589,839 | 113,900 | ||||||
| Write downs and other charges | 358,807 | 1,101,472 | ||||||
| Deferred rent amortization | 9,943 | 36,068 | ||||||
| Stock compensation amortization | 104,140 | 124,279 | ||||||
| Increase in swap fair value | (171,018 | ) | (250,385 | ) | ||||
| Loss on disposal of assets | 7,863 | 77,183 | ||||||
| Adjusted EBITDA | $ | 6,038,323 | $ | 6,245,133 | ||||
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 provide a corporate update. The call can be accessed live by dialing (888) 254-3590. International callers can access the call by dialing (323) 994-2093.
A telephone replay of the conference call will be available after 7:30 PM ET and can be accessed by dialing (844) 512-2921. International callers can access the replay by dialing (412) 317-6671; the pin number is 8454743. The replay will be available through August 2, 2018.
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 local casino in Henderson, Nevada (clubfortune.com).
Contacts:
Nevada Gold & Casinos, Inc.
Michael P. Shaunnessy / James Meier
(702) 685-1000
Stonegate Capital Partners
Preston Graham
(972) 850-2001
| Nevada Gold & Casinos, Inc. | |||||||||||||||
| Consolidated Statements of Operations | |||||||||||||||
| Three Months Ended | Twelve Months Ended | ||||||||||||||
| April 30, | April 30, | April 30, | April 30, | ||||||||||||
| 2018 | 2017 | 2018 | 2017 | ||||||||||||
| Revenues: | |||||||||||||||
| Casino | $ | 16,172,021 | $ | 17,607,040 | $ | 65,767,827 | $ | 65,838,576 | |||||||
| Food and beverage | 3,435,099 | 3,424,377 | 13,252,982 | 13,439,326 | |||||||||||
| Other | 494,052 | 517,842 | 1,978,619 | 2,140,113 | |||||||||||
| Gross revenues | 20,101,172 | 21,549,259 | 80,999,428 | 81,418,015 | |||||||||||
| Less promotional allowances | (1,615,610 | ) | (1,707,086 | ) | (6,446,902 | ) | (6,959,066 | ) | |||||||
| Net revenues | 18,485,562 | 19,842,173 | 74,552,526 | 74,458,949 | |||||||||||
| Expenses: | |||||||||||||||
| Casino | 8,779,150 | 9,307,408 | 36,476,733 | 36,488,019 | |||||||||||
| Food and beverage | 1,790,000 | 1,606,638 | 6,801,269 | 6,194,698 | |||||||||||
| Other | 49,923 | 55,034 | 206,764 | 208,090 | |||||||||||
| Marketing and administrative | 4,754,110 | 5,168,141 | 20,715,534 | 20,752,103 | |||||||||||
| Facility | 505,787 | 498,322 | 2,008,090 | 2,126,150 | |||||||||||
| Corporate | 1,100,004 | 570,581 | 3,009,735 | 2,719,003 | |||||||||||
| Depreciation and amortization | 522,261 | 714,652 | 2,370,752 | 3,021,280 | |||||||||||
| Loss on sale of assets | 2,090 | 20,693 | 7,863 | 77,183 | |||||||||||
| Write downs and other charges | 358,807 | - | 358,807 | 1,101,472 | |||||||||||
| Total operating expenses | 17,862,132 | 17,941,469 | 71,955,547 | 72,687,998 | |||||||||||
| Operating income from continuing operations | 623,430 | 1,900,704 | 2,596,979 | 1,770,951 | |||||||||||
| Non-operating income (expenses): | |||||||||||||||
| Interest income | 8,818 | 15,770 | 46,241 | 81,011 | |||||||||||
| Interest expense and amortization of loan costs | (167,772 | ) | (165,542 | ) | (637,387 | ) | (747,554 | ) | |||||||
| Change in swap fair value | 37,575 | 23,865 | 171,018 | 250,385 | |||||||||||
| Income before income tax | 502,051 | 1,774,797 | 2,176,851 | 1,354,793 | |||||||||||
| Income tax expense | (134,930 | ) | (578,237 | ) | (853,426 | ) | (790,829 | ) | |||||||
| Net income | $ | 367,121 | $ | 1,196,560 | $ | 1,323,425 | $ | 563,964 | |||||||
| Per share information: | |||||||||||||||
| Net income per common share - basic and diluted | $ | 0.02 | $ | 0.07 | $ | 0.08 | $ | 0.03 | |||||||
| Basic weighted average number of shares outstanding | 16,848,182 | 17,583,101 | 16,985,532 | 17,688,229 | |||||||||||
| Diluted weighted average number of share outstanding | 17,213,052 | 17,918,456 | 17,350,402 | 17,990,524 | |||||||||||
| Nevada Gold & Casinos, Inc. | |||||||
| Consolidated Balance Sheets | |||||||
| April 30, | April 30, | ||||||
| 2018 | 2017 | ||||||
| ASSETS | |||||||
| Current assets: | |||||||
| Cash and cash equivalents | $ | 9,508,931 | $ | 10,631,903 | |||
| Restricted cash | 2,369,063 | 1,994,312 | |||||
| Accounts receivable, net of allowances | 485,774 | 808,484 | |||||
| Prepaid expenses | 1,436,538 | 1,209,507 | |||||
| Notes receivable, current portion | - | 383,093 | |||||
| Inventory and other current assets | 430,296 | 423,113 | |||||
| Total current assets | 14,230,602 | 15,450,412 | |||||
| Real estate held for sale | 750,000 | 750,000 | |||||
| Goodwill | 16,923,588 | 16,923,588 | |||||
| Identifiable intangible assets, net of accumulated | |||||||
| amortization of $9,361,189 and $8,869,497 at April 30, | |||||||
| 2018 and April 30, 2017, respectively | 3,497,779 | 4,107,328 | |||||
| Property and equipment, net of accumulated depreciation | |||||||
| of $9,260,152 and $7,635,620 at April 30, 2018 and | |||||||
| April 30, 2017, respectively | 12,812,411 | 13,958,715 | |||||
| Deferred tax asset | 704,044 | 1,557,470 | |||||
| Other assets | 204,672 | 70,000 | |||||
| Total assets | $ | 49,123,096 | $ | 52,817,513 | |||
| LIABILITIES AND STOCKHOLDERS’ EQUITY | |||||||
| Current liabilities: | |||||||
| Accounts payable and accrued liabilities | $ | 1,695,495 | $ | 1,303,571 | |||
| Accrued payroll and related | 2,049,313 | 1,925,592 | |||||
| Accrued player's club points and progressive jackpots | 2,592,456 | 2,348,068 | |||||
| Total current liabilities | 6,337,264 | 5,577,231 | |||||
| Long-term debt | 7,895,240 | 12,061,411 | |||||
| Other long-term liabilities | 637,207 | 667,110 | |||||
| Total liabilities | 14,869,711 | 18,305,752 | |||||
| Stockholders' equity: | |||||||
| Common stock, $0.12 par value per share; 50,000,000 | |||||||
| shares authorized; 18,715,985 and 18,627,167 shares issued and 16,848,182 and 17,547,665 shares outstanding at April 30, 2018, and April 30, 2017, respectively | 2,245,927 | 2,235,269 | |||||
| Additional paid-in capital | 27,557,151 | 27,449,319 | |||||
| Retained earnings | 13,644,239 | 12,320,814 | |||||
| Treasury stock, 1,867,803 and 1,079,502 shares at April 30, 2018 and April 30, 2017, at cost | (9,193,932 | ) | (7,493,641 | ) | |||
| Total stockholders' equity | 34,253,385 | 34,511,761 | |||||
| Total liabilities and stockholders' equity | $ | 49,123,096 | $ | 52,817,513 | |||