Dover Downs Gaming & Entertainment, Inc. (NYSE: DDE) today reported results for the three months ended March 31, 2016.
Net loss was ($239,000), or ($.01) per diluted share, compared with net loss of ($352,000), or ($.01) per diluted share for the first quarter of 2015.
The Company’s revenues for the first quarter of 2016 were $44,717,000 compared with $44,338,000 for the first quarter of 2015.
Gaming revenues of $39,358,000 were up 1.5% compared to the first quarter of last year, primarily from higher table game revenue.
Other operating revenues were $5,359,000 compared to $5,562,000 last year. Occupancy levels in the Dover Downs Hotel were approximately 74% for the first quarter of 2016 compared with approximately 76% for the first quarter of 2015.
General and administrative expenses of $1,328,000 were lower than last year, primarily from employee separation costs during the first quarter of last year.
Depreciation expense of $1,887,000 was down compared to $2,152,000 last year.
Interest expense decreased to $229,000 during the quarter as a result of lower rates and lower outstanding borrowings.
Denis McGlynn, the Company's President and Chief Executive Officer, stated: "We point out in our recently filed Annual Report to Stockholders that our fate remains in the hands of our state legislature. Recommendations of the legislatively appointed Gaming and Lottery Study Commission need to be enacted for the health of our industry and for thousands of employees whose livelihood depends – directly and indirectly – on having Delaware’s casinos able to compete effectively in the regional marketplace. It is imperative that we re-invest in our facilities and amenities. And if we cannot spend the marketing and promotional dollars that will bring repeat customers into Delaware, they will go to neighboring jurisdictions. Last year, Senate Bill 30 did not advance due to unrelated state budget issues. This year, Senate Bill 183 – which phases in required changes to the revenue sharing model over the next four years – represents what industry experts believe to be the best possible strategic and long-term restructuring model for all stakeholders. It is time for us to enact a long-term solution and we are working diligently with our state legislators toward that end.”
This release contains or may contain forward-looking statements based on management’s beliefs and assumptions. Such statements are subject to various risks and uncertainties that could cause results to vary materially. Please refer to the Company’s SEC filings for a discussion of such factors.
Owned by Dover Downs Gaming & Entertainment, Inc. (NYSE: DDE), Dover Downs Hotel & Casino® is a premier gaming and entertainment resort destination in the Mid-Atlantic region. Gaming operations consist of approximately 2,300 slots and a full complement of table games including poker. The AAA-rated Four Diamond hotel is Delaware’s largest with 500 luxurious rooms/suites and amenities including a full-service spa/salon, concert hall and 41,500 sq. ft. of multi-use event space. Live, world-class harness racing is featured November through April, and horse racing is simulcast year-round. Professional football parlay betting is accepted during the season. Additional property amenities include multiple restaurants from fine dining to casual fare, bars/lounges and retail shops. For more information, please visit www.doverdowns.com.
| DOVER DOWNS GAMING & ENTERTAINMENT, INC. | ||||||||
| CONSOLIDATED STATEMENTS OF OPERATIONS | ||||||||
| In Thousands, Except Per Share Amounts | ||||||||
| (Unaudited) | ||||||||
| Three Months Ended | ||||||||
| March 31, | ||||||||
| 2016 | 2015 | |||||||
| Revenues: | ||||||||
| Gaming (1) | $ | 39,358 | $ | 38,776 | ||||
| Other operating (2) | 5,359 | 5,562 | ||||||
| 44,717 | 44,338 | |||||||
| Expenses: | ||||||||
| Gaming | 37,495 | 36,762 | ||||||
| Other operating | 3,973 | 3,887 | ||||||
| General and administrative | 1,328 | 1,496 | ||||||
| Depreciation | 1,887 | 2,152 | ||||||
| 44,683 | 44,297 | |||||||
| Operating earnings | 34 | 41 | ||||||
| Interest expense | (229 | ) | (348 | ) | ||||
| Loss before income taxes | (195 | ) | (307 | ) | ||||
| Income tax expense | (44 | ) | (45 | ) | ||||
| Net loss | $ | (239 | ) | $ | (352 | ) | ||
| Net loss per common share: | ||||||||
| - Basic | $ | (0.01 | ) | $ | (0.01 | ) | ||
| - Diluted | $ | (0.01 | ) | $ | (0.01 | ) | ||
| Weighted average shares outstanding: | ||||||||
| - Basic | 32,199 | 32,083 | ||||||
| - Diluted | 32,199 | 32,083 | ||||||
| _________________________ | ||||||||
| (1) | Gaming revenues from the Company’s slot machine and table game operations include the total win from such operations. The Delaware State Lottery Office collects the win and remits a portion thereof to the Company as its commission for acting as a Licensed Agent. The difference between total win and the amount remitted to the Company is reflected in gaming expenses. | ||
| (2) | Other operating revenues do not include the retail amount of promotional allowances which are provided to customers on a complimentary basis. | ||
| DOVER DOWNS GAMING & ENTERTAINMENT, INC. | ||||||||
| CONSOLIDATED BALANCE SHEETS | ||||||||
| In Thousands | ||||||||
| (Unaudited) | ||||||||
| March 31, | December 31, | |||||||
| 2016 | 2015 | |||||||
| ASSETS | ||||||||
| Current assets: | ||||||||
| Cash | $ | 11,077 | $ | 10,496 | ||||
| Accounts receivable | 3,055 | 2,926 | ||||||
| Due from State of Delaware | 2,663 | 7,952 | ||||||
| Inventories | 1,938 | 1,912 | ||||||
| Prepaid expenses and other | 1,983 | 2,530 | ||||||
| Receivable from Dover Motorsports, Inc. | 10 | - | ||||||
| Income taxes receivable | 225 | 254 | ||||||
| Deferred income taxes | 1,433 | 1,308 | ||||||
| Total current assets | 22,384 | 27,378 | ||||||
| Property and equipment, net | 144,750 | 145,425 | ||||||
| Other assets | 638 | 672 | ||||||
| Deferred income taxes | 297 | 482 | ||||||
| Total assets | $ | 168,069 | $ | 173,957 | ||||
| LIABILITIES AND STOCKHOLDERS’ EQUITY | ||||||||
| Current liabilities: | ||||||||
| Accounts payable | $ | 3,875 | $ | 3,380 | ||||
| Purses due horsemen | 2,750 | 7,473 | ||||||
| Accrued liabilities | 7,690 | 8,538 | ||||||
| Payable to Dover Motorsports, Inc. | - | 44 | ||||||
| Deferred revenue | 503 | 408 | ||||||
| Revolving line of credit | 31,000 | 31,500 | ||||||
| Total current liabilities | 45,818 | 51,343 | ||||||
| Liability for pension benefits | 7,423 | 7,606 | ||||||
| Total liabilities | 53,241 | 58,949 | ||||||
| Stockholders’ equity: | ||||||||
| Common stock | 1,814 | 1,799 | ||||||
| Class A common stock | 1,487 | 1,487 | ||||||
| Additional paid-in capital | 5,446 | 5,424 | ||||||
| Retained earnings | 110,263 | 110,502 | ||||||
| Accumulated other comprehensive loss | (4,182 | ) | (4,204 | ) | ||||
| Total stockholders’ equity | 114,828 | 115,008 | ||||||
| Total liabilities and stockholders’ equity | $ | 168,069 | $ | 173,957 | ||||
| DOVER DOWNS GAMING & ENTERTAINMENT, INC. | ||||||||
| CONSOLIDATED STATEMENTS OF CASH FLOWS | ||||||||
| In Thousands | ||||||||
| (Unaudited) | ||||||||
| Three Months Ended | ||||||||
| March 31, | ||||||||
| 2016 | 2015 | |||||||
| Operating activities: | ||||||||
| Net loss | $ | (239 | ) | $ | (352 | ) | ||
Adjustments to reconcile net loss to net cash provided by operating activities: | ||||||||
| Depreciation | 1,887 | 2,152 | ||||||
| Amortization of credit facility origination fees | 26 | 27 | ||||||
| Stock-based compensation | 103 | 105 | ||||||
| Deferred income taxes | 46 | (31 | ) | |||||
| Changes in assets and liabilities: | ||||||||
| Accounts receivable | (129 | ) | (616 | ) | ||||
| Due from State of Delaware | 5,289 | 4,603 | ||||||
| Inventories | (26 | ) | 140 | |||||
| Prepaid expenses and other | 559 | 121 | ||||||
| Receivable from/payable to Dover Motorsports, Inc. | (54 | ) | 11 | |||||
| Income taxes receivable | 28 | 78 | ||||||
| Accounts payable | 562 | (579 | ) | |||||
| Purses due horsemen | (4,723 | ) | (4,940 | ) | ||||
| Accrued liabilities | (848 | ) | 2,437 | |||||
| Deferred revenue | 95 | 203 | ||||||
| Liability for pension benefits | (149 | ) | (109 | ) | ||||
| Net cash provided by operating activities | 2,427 | 3,250 | ||||||
| Investing activities: | ||||||||
| Capital expenditures | (1,279 | ) | (472 | ) | ||||
| Purchase of available-for-sale securities | (1 | ) | - | |||||
| Net cash used in investing activities | (1,280 | ) | (472 | ) | ||||
| Financing activities: | ||||||||
| Borrowings from revolving line of credit | 15,450 | 14,820 | ||||||
| Repayments of revolving line of credit | (15,950 | ) | (15,830 | ) | ||||
| Repurchase of common stock | (66 | ) | (65 | ) | ||||
| Net cash used in financing activities | (566 | ) | (1,075 | ) | ||||
| Net increase in cash | 581 | 1,703 | ||||||
| Cash, beginning of period | 10,496 | 10,079 | ||||||
| Cash, end of period | $ | 11,077 | $ | 11,782 | ||||
View source version on businesswire.com: http://www.businesswire.com/news/home/20160428005364/en/
Contacts:
Timothy R. Horne - Sr.
Vice President-Finance
302-857-3292
