Monarch Casino & Resort Reports Record 2024 Fourth Quarter Financial Results

Declares Cash Dividend of $0.30 per Share Payable on March 15, 2025 February 11, 2025 16:04 ET | Source: Monarch Casino & Resort, Inc. RENO, Nev., Feb. 11, 2025 (GLOBE NEWSWIRE) -- Monarch Casino & Resort, Inc. (Nasdaq: MCRI) (“Monarch” or “the Company”) today reported operating results for the fourth quarter and full year ended December 31, 2024, as summarized below: ($ in thousands, except per share data and percentages) Three Months Ended December 31, Twelve Months Ended December 31, 2024 2023 Change 2024 2023 ChangeNet revenue$134,513 $128,186 4.9% $522,186 $501,478 4.1% Net income (1)(2)$25,495 $18,202 40.1% $94,053 $82,448 14.1% Adjusted EBITDA (3)$47,280 $43,003 9.9% $180,394 $170,832 5.6% Basic earnings per share$1.39 $0.94 47.9% $5.05 $4.28 18.0%Diluted earnings per share (1)(2)$1.36 $0.93 46.2% $4.96 $4.20 18.1% (1)The year-over-year positive variances in Net Income and Diluted EPS in the fourth quarter of 2024 are result of: a) the effective tax rate (19.7% in the fourth quarter of 2024 and 28.6% in the fourth quarter of 2023), based primarily on the amount of the excess tax benefit on stock compensation; b) lower legal and consulting costs related to the ongoing litigation with the Monarch Black Hawk’s general contractor ($0.1 million and $2.8 million in the fourth quarter of 2024 and 2023, respectively); offset by c) higher depreciation expense ($13.4 million and $12.1 million in the fourth quarter of 2024 and 2023, respectively);(2)The 2024 year-over-year positive variances in Net Income and Diluted EPS are result of: a) the effective tax rate (21.6% in 2024 and 24.0% in 2023), based primarily on the amount of the excess tax benefit on stock compensation; b) lower legal and consulting costs related to the ongoing litigation with the Monarch Black Hawk’s general contractor ($0.8 million and $6.9 million in 2024 and 2023, respectively); offset by c) higher depreciation expense ($51.4 million and $47.3 million in 2024 and 2023, respectively);(3)Definitions, disclosures and reconciliations of non-GAAP financial information are included later in the release. CEO Comment“Monarch ended 2024 with record financial results in both the fourth quarter and full year. Fourth quarter net revenue and adjusted EBITDA were $134.5 million and $47.3 million, respectively, resulting in a record fourth quarter EBITDA margin of 35.1%. Our performance in the fourth quarter and full year clearly underpins the effectiveness of Monarch’s operating strategies and our ability to drive sustained growth. “Monarch Black Hawk continues to grow market share and increase revenue across all its business segments. The property benefited from its position as the premier resort casino in Colorado. Our luxury resort offerings and exceptional service continue to attract and retain mid-to-upper tier guests from the Denver and Boulder metro areas. “In Reno, Atlantis is near the completion of approximately $100 million in capital investment in the redesign and upgrade of the property’s hotel rooms. We anticipate that the last stage of the project, which includes work on the remaining 246 hotel rooms, will be completed in phases by the second quarter of 2025. To introduce our new luxury’ hotel rooms to the public, we are launching a “Once is All it Takes” brand campaign. We continue to focus on implementing new technologies and processes across the property, which we believe will be financially rewarding over the long-term.” Summary of 2024 Fourth Quarter Operating ResultsIn the 2024 fourth quarter, the Company generated net revenue of $134.5 million compared to $128.2 million in the corresponding prior-year quarter. Casino and hotel revenues increased 6.0% and 8.3%, respectively, compared to the prior year, while food and beverage (“F&B”) revenue decreased 0.7%. Selling, general and administrative (“SG&A”) expense for the fourth quarter of 2024 was $27.8 million compared to $28.7 million in the corresponding prior-year period, primarily driven by decreases in labor expense and advertising expense. As a percentage of net revenue, SG&A expense decreased to 20.7% from 22.4% in the corresponding prior-year period. Casino operating expense as a percentage of casino revenue increased to 36.8% during the fourth quarter of 2024 from 36.2% in the corresponding prior-year period primarily due to increases in labor expense and technology related expense. During the fourth quarter of 2024, F&B operating expense as a percentage of F&B revenue increased to 73.4% from 71.8% in the corresponding prior-year period due to an increase in cost of goods sold. Hotel operating expense as a percentage of hotel revenue decreased to 34.8% in the fourth quarter of 2024 compared to 37.6% in the corresponding prior-year period primarily due to an increase in average daily rate and effective cost management. Net income for the fourth quarter of 2024 increased 40.1% and diluted EPS increased 46.2% compared to the same period last year. The Company generated consolidated Adjusted EBITDA of $47.3 million in the fourth quarter of 2024, which represents a $4.3 million, or 9.9%, increase compared to the same prior-year period. Credit Facility and LiquidityAs of December 31, 2024, the Company had cash and cash equivalents of $58.8 million and no borrowings against its credit facility. Capital expenditures of $10.7 million in the fourth quarter of 2024 were funded from operating cash flow and included capital expenditures related to the ongoing redesign and upgrade of guest rooms at Atlantis, as well as ongoing maintenance capital expenditures at both properties. On December 15, 2024, the Company paid a cash dividend of $0.30 per share to its stockholders of record as of December 1, 2024. The cash dividend was funded from operating cash flow. We believe that Monarch’s strong balance sheet and free cash flow favorably positions the Company to continue investing in its properties and paying cash dividends. The Company has been diligently evaluating potential M&A transactions, which we believe could drive additional long-term value for our stockholders. Quarterly Dividend DeclarationThe Company today announced a cash dividend of $0.30 per share of its outstanding common stock. The dividend is payable on March 15, 2025 to stockholders of record as of March 1, 2025. This cash dividend is part of the previously announced annual cash dividend of $1.20 per share payable in quarterly payments and subject to quarterly review and evaluation by the Company’s Board of Directors. Forward Looking StatementsThis press release contains forward-looking statements within the meaning of the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. Forward-looking statements can be identified by words such as "plan," "believe," "expect," "seem," "look," "look forward," "positioning," "future," "will," "confident" and similar references to future periods. Example of forward-looking statements include, among others, statements we make regarding: (i) the continuing strength of our balance sheet and our expected free cash flow; (ii) our expectations regarding continuing our dividend payments in the future; (iii) our expectations regarding the cash flow we expect to generate to fund our cash dividends to stockholders; (iv) our expectations regarding the completion of room renovations at the Atlantis; and (v) our beliefs regarding the impact of our capital investment strategy and evaluation of potential strategic transactions on our long term success. Actual results and future events and conditions may differ materially from those described in any forward-looking statements. Therefore, you should not rely on any of these forward-looking statements. Important factors that could cause actual results to differ materially from estimates or projections contained in the forward-looking statements include, without limitation: adverse impacts of outbreaks of contagious diseases on our business, financial condition and operating results;actions taken by government officials at the federal, state and/or local level with respect to the containment of disease outbreaks, including, without limitation, temporary or extended shutdowns, travel restrictions, social distancing and shelter-in-place orders;our ability to manage guest safety concerns in connection with an outbreak of contagious diseases;our ability to maintain compliance with the terms and conditions of our credit facilities and other material contracts in the event of any unexpected or unplanned events, such as temporary or extended shutdowns;access to available and reasonable financing on a timely basis;our ability to maintain strong working relationships with our regulators, employees, lenders, suppliers, insurance carriers, customers, and other stakeholders;impacts of any uninsured losses;changes in guest visitation or spending patterns due to economic conditions, health or other concerns;construction factors, including delays, disruptions, availability of labor and materials, increased costs of labor and materials, contractor disagreements, zoning issues, environmental restrictions, soil and water conditions, weather and other hazards, site access matters, building permit issues and other regulatory approvals or issues;ongoing disagreements over costs of and responsibility for delays and other construction related matters with our general contractor at Monarch Casino Resort Spa Black Hawk, PCL Construction Services, Inc., including, as previously reported, the litigation against us by such contractor;our counterclaims for construction defects, breach of contract, breach of warranty, fraud, fraudulent inducement, negligence or other construction related claims that we may have against our general contractor at Monarch Casino Resort Spa Black Hawk, PCL Construction Services, Inc., or others, in connection with construction and completion of Monarch Casino Resort Spa Black Hawk and any adverse impacts on operations required to correct the same, including those claims asserted in the above-mentioned litigation against PCL Construction Services, Inc.;the outcome of the litigation by and against the general contractor of Monarch Casino Resort Spa Black Hawk, PCL Construction Services, Inc., in the above-mentioned litigation in which litigation the parties are currently awaiting the Court's decision on their respective claims following the trial on the matter;our potential need to post bonds or other forms of surety to support our legal remedies;risks related to development and construction activities (including disputes with and defaults by contractors and subcontractors; construction, equipment or staffing problems and delays; shortages of materials or skilled labor; environmental, health and safety issues; weather and other hazards, site access matters, and unanticipated cost increases);our ability to generate sufficient operating cash flow to help finance our expansion plans and any subsequent debt reduction;changes in laws mandating increases in minimum wages and employee benefits;changes in laws and regulations permitting expanded and other forms of gaming in our key markets;the effects of local and national economic, credit and capital market conditions on the economy in general and on the gaming industry and our business in particular, including predictions for a potential recession;the effects of labor shortages on our market position, growth and financial results;the potential of increases in state and federal taxation;potential of increased regulatory and other burdens;guest acceptance of our expanded facilities once completed and the resulting impact on our market position, growth and financial results;competition in our target market areas;broad-based inflation, including wage inflation; andthe impact of the conflicts taking place in Ukraine and Israel. Additional information concerning potential factors that could adversely affect all forward-looking statements, including the Company's financial results, is included in our Securities and Exchange Commission filings, including our most recent annual report on Form 10-K and quarterly reports on Form 10-Q, which are available on our website at www.monarchcasino.com. About Monarch Casino & Resort, Inc.Monarch Casino & Resort, Inc., through its subsidiaries, owns and operates the Monarch Casino Resort Spa ("Monarch Black Hawk") in Black Hawk, Colorado, approximately 40 miles west of Denver and the Atlantis Casino Resort Spa ("Atlantis"), a hotel/casino facility in Reno, Nevada. For additional information on Monarch, visit the Company's website at www.monarchcasino.com. Monarch Black Hawk features 516 guest rooms and suites, and approximately 60,000 square feet of casino space. The resort offers approximately 1,000 slot machines; 43 table games; a live poker room; keno; and a sports book. It also includes 10 bars and lounges, as well as four dining options: a twenty-four-hour full-service restaurant, a buffet-style restaurant, the Monarch Chophouse (a fine-dining steakhouse), and Bistro Mariposa (elevated Southwest cuisine), banquet and meeting room space, a retail store, a concierge lounge and an upscale spa and enclosed year-round pool facility located on the top floor of the tower. The resort is connected to a nine-story parking structure with approximately 1,350 parking spaces, and additional valet parking, with total property capacity of approximately 1,500 spaces. Atlantis features 817 guest rooms and suites, and approximately 61,000 square feet of casino space. The casino features approximately 1,200 slot and video poker machines; approximately 33 table games, including blackjack, craps, roulette, and others; a race and sports book; a 24-hour live keno lounge; and a poker room. It also includes eight food outlets; two gourmet coffee and pastry bars; a 30,000 square foot health spa and salon with an enclosed year-round pool; retail outlet offering clothing and traditional gift shop merchandise; an 8,000 square-foot family entertainment center; and approximately 52,000 square feet of banquet, convention and meeting room space. Contacts:John FarahiChief Executive Officer775/824-4401 or JFarahi@monarchcasino.com Joseph Jaffoni, Richard Land, James LeahyJCIR212/835-8500 or mcri@jcir.com - financial tables follow - MONARCH CASINO & RESORT, INC. AND SUBSIDIARIESCONSOLIDATED STATEMENTS OF INCOME(In thousands, except per share data, unaudited) Three months endedDecember 31, Twelve months endedDecember 31, 2024 2023 2024 2023Revenues Casino$77,093 $72,714 $293,813 $282,292 Food and beverage 32,581 32,816 127,474 126,628 Hotel 18,210 16,813 76,357 70,986 Other 6,629 5,843 24,542 21,572 Net revenues 134,513 128,186 522,186 501,478 Operating expenses Casino 28,371 26,300 109,172 102,771 Food and beverage 23,914 23,559 93,916 91,629 Hotel 6,330 6,327 26,221 26,434 Other 3,056 2,920 12,061 11,469 Selling, general and administrative 27,837 28,657 108,286 105,819 Depreciation and amortization 13,365 12,142 51,359 47,294 Other operating items, net 117 2,898 1,048 5,910 Total operating expenses 102,990 102,803 402,063 391,326 Income from operations 31,523 25,383 120,123 110,152 Interest income (expense), net 245 111 (104) (1,625)Income before income taxes 31,768 25,494 120,019 108,527 Provision for income taxes (6,273) (7,292) (25,966) (26,079)Net income$25,495 $18,202 $94,053 $82,448 Earnings per share of common stock Basic$1.39 $0.94 $5.05 $4.28 Diluted$1.36 $0.93 $4.96 $4.20 Weighted average number of common shares and potential common shares outstanding Basic 18,402 19,266 18,611 19,244 Diluted 18,758 19,595 18,971 19,618 MONARCH CASINO & RESORT, INC. AND SUBSIDIARIESCONSOLIDATED BALANCE SHEET(In thousands, except per share data, unaudited) December 31, 2024 December 31, 2023ASSETS Current assets Cash and cash equivalents$58,760 $43,361 Receivables, net 10,257 11,990 Income taxes receivable 1,523 1,006 Inventories 9,296 7,614 Prepaid expenses and other 10,586 10,995 Total current assets 90,422 74,966 Property and equipment, net 575,287 580,497 Goodwill 25,111 25,111 Intangible assets, net 345 299 Other long-term assets 418 - Total assets$691,583 $680,873 LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities Accounts payable$13,623 $23,092 Construction accounts payable 51,101 47,566 Accrued expenses 53,198 51,812 Short-term lease liability 921 897 Total current liabilities 118,843 123,367 Deferred income taxes 19,684 23,084 Long-term lease liability 13,143 14,021 Long-term debt - 5,500 Other long-term liabilities 881 1,761 Total liabilities 152,551 167,733 Stockholders' equity Preferred stock, $.01 par value, 10,000,000 shares authorized; none issued - - Common stock, $.01 par value, 30,000,000 shares authorized; 193 191 19,364,531 shares issued and 18,436,540 outstanding at December 31, 2024; 19,154,031 shares issued and 19,091,497 outstanding at December 31, 2023 Additional paid-in capital 62,891 48,821 Treasury stock, 927,991 shares at December 31, 2024; 62,534 shares at December 31, 2023 (63,686) (3,718)Retained earnings 539,634 467,846 Total stockholders' equity 539,032 513,140 Total liabilities and stockholders' equity$691,583 $680,873 MONARCH CASINO & RESORT, INC. AND SUBSIDIARIES RECONCILIATION OF ADJUSTED EBITDA TO NET INCOME (In thousands, unaudited) The following table sets forth a reconciliation of Adjusted EBITDA, a non-GAAP financial measure, to net income, a GAAP financial measure: Three Months Ended December 31, Twelve Months EndedDecember 31, 2024 2023 2024 2023Net income$25,495 $18,202 $94,053 $82,448 Expenses: Stock based compensation 2,275 2,580 7,864 7,476 Depreciation and amortization 13,365 12,142 51,359 47,294 Provision for income taxes 6,273 7,292 25,966 26,079 Interest (income) expense (245) (111) 104 1,625 Construction litigation expenses (2) 135 2,827 799 6,946 Insurance claims proceeds, net (2) - - - (1,195)(Gain) loss on disposition of assets (2) (18) 71 249 159 Adjusted EBITDA (1)$47,280 $43,003 $180,394 $170,832 (1)Adjusted EBITDA, a non-GAAP financial measure, consists of net income plus loss on disposal of assets, provision for income taxes, stock-based compensation expense, other one-time charges, construction litigation expenses, acquisition expenses, interest expense, depreciation and amortization less interest income, any benefit for income taxes and gain on disposal of assets. Adjusted EBITDA should not be construed as an alternative to operating income (as determined in accordance with US Generally Accepted Accounting Principles), as an indicator of the Company's operating performance, as an alternative to cash flows from operating activities (as determined in accordance with US GAAP) or as a measure of liquidity. This measure enables comparison of the Company's performance over multiple periods, as well as against the performance of other companies in our industry that report Adjusted EBITDA, although some companies do not calculate this measure in the same manner and, therefore, the measure as presented may not be comparable to similarly titled measures presented by other companies.(2)Amount included in the "Other operating items, net" in the Consolidated Statement of Income.

Monarch Casino & Resort Reports Record 2024 Fourth Quarter Financial Results

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