Golden Entertainment Reports 2023 Fourth Quarter and Full Year 2023 Results
- Strong financial performance with significant revenue in Q4 and full-year 2023.
- Completion of non-core divestitures generating over $600 million in total proceeds.
- Initiation of a recurring quarterly cash dividend of $0.25 per share.
- Repaid over $60 million of debt in Q4 and $239 million in total debt in 2023.
- Positive outlook on the company's portfolio focusing on Nevada casino resorts and taverns.
- Completion of the sale of Nevada distributed gaming business to J&J Ventures Gaming, LLC for $213.5 million.
- Decline in Q4 2023 net income due to an asset impairment charge related to Colorado Belle Casino Resort.
- Year-over-year decline in Q4 revenues and Adjusted EBITDA due to exclusion of certain operations sold in 2023.
- Full-year 2023 net income benefited from a gain on the sales of Rocky Gap Casino Resort and Montana gaming operations.
- Full-year 2023 Adjusted EBITDA declined from 2022 primarily due to the exclusion of results from businesses sold in 2023.
- Debt outstanding at $677.7 million as of December 31, 2023, with cash and cash equivalents of $197.6 million.
- Upcoming investor conference call and webcast to discuss Q4 and full-year results.
- None.
Insights
The reported financial results of Golden Entertainment, Inc. indicate a mixed performance with a net loss in Q4 but a substantial net income for the full year. A critical factor to evaluate is the asset impairment charge of $12.1 million, which impacted the quarterly results negatively. Despite this, the full-year net income includes a significant gain from asset sales, which is a non-recurring event and should be factored out for a normalized earnings perspective. The initiation of a quarterly cash dividend suggests confidence in the company's liquidity and future cash flows, however, investors should scrutinize the sustainability of this dividend given the net loss in the last quarter.
Furthermore, the debt repayment strategy, reducing obligations by $239 million in 2023, is indicative of a strong focus on balance sheet health. This, combined with the lack of borrowings under the revolving credit facility, could position the company favorably for future financial flexibility. The Adjusted EBITDA, despite a year-over-year decrease, remains a robust indicator of operational profitability, especially when considering the divestitures.
Golden Entertainment's strategic divestitures and focus on core assets reflect a broader industry trend where companies streamline operations to enhance value. The sale of non-core assets and the concentration on Nevada's market could leverage the state's positive economic trends, potentially improving market share and customer loyalty. However, the revenue decline in Q4 and the full year suggests that the company must drive growth within its streamlined portfolio to offset lost revenues from divested assets.
Investor sentiment may be influenced by the mixed signals of a net loss in the short term versus strong full-year performance. The market will likely monitor the company's operational efficiency and ability to generate consistent cash flow, particularly in the context of the newly initiated dividend. The company's future performance in the competitive Nevada market will be a critical factor for long-term valuation.
From a legal and regulatory standpoint, the transactions involving the sale of distributed gaming operations require careful scrutiny to ensure compliance with state and federal regulations. The completion of these sales and the absence of any disclosed regulatory issues is a positive outcome for the company. It is also important to note that the transaction costs associated with these sales, while not substantial in the context of the overall gain, should be transparently accounted for in financial reporting.
Additionally, the initiation of a recurring dividend must be in line with corporate governance policies and state laws, ensuring that it does not jeopardize the company's financial stability or obligations to creditors. The legal team's role in these processes is to mitigate risk and ensure that all transactions and new financial policies are executed with due diligence to protect shareholder interests.
-
Fourth quarter revenue of
$230.7 million $9.4 million $48.8 million -
2023 full year revenue of
$1.1 billion $255.8 million $222.5 million -
In January 2024 completed
$213.5 million Nevada distributed gaming business; combined with non-core divestitures in 2023, generated over$600 million -
Over
$60 million $239 million -
Initiated recurring quarterly cash dividend of
$0.25
Blake Sartini, Chairman and Chief Executive Officer of Golden, commented, “In January, we completed the sale of our
On January 10, 2024, the Company completed the previously disclosed sale of its distributed gaming operations in
During the fourth quarter of 2023, the Company repurchased
Consolidated Results
Fourth quarter 2023 revenues were
For both the full year 2023 and 2022, revenues were
Debt and Liquidity
As of December 31, 2023, the Company’s total principal amount of debt outstanding was
Investor Conference Call and Webcast
The Company will host a webcast and conference call today, February 29, 2024 at 5:00 p.m. Eastern Time (2:00 p.m. Pacific Time), to discuss the 2023 fourth quarter and full year results. The conference call may be accessed live over the phone by dialing (833) 816-1405 or (412) 317-0498 for international callers. A replay will be available beginning at 7:00 p.m. Eastern Time today and may be accessed by dialing (844) 512-2921 or (412) 317-6671 for international callers; the passcode is 10185511. The replay will be available until March 7, 2024. The call will also be webcast live through the “Investors” section of the Company’s website, www.goldenent.com. A replay of the audio webcast will also be archived on the Company’s website, www.goldenent.com.
Forward-Looking Statements
This press release contains forward-looking statements regarding future events and the Company’s future results that are subject to the safe harbors created under the Securities Act of 1933 and the Securities Exchange Act of 1934. Forward-looking statements can generally be identified by the use of words such as “anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,” “forecast,” “intend,” “may,” “plan,” “project,” “potential,” “seek,” “should,” “think,” “will,” “would” and similar expressions, or they may use future dates. In addition, forward-looking statements in this press release include, without limitation statements regarding: the Company’s strategies, objectives, business opportunities and plans; anticipated future growth and trends in the Company’s business or key markets; the payment of recurring quarterly cash dividends; projections of future financial condition, operating results or other financial items; and other characterizations of future events or circumstances as well as other statements that are not statements of historical fact. Forward-looking statements are based on the Company’s current expectations and assumptions regarding its business, the economy and other future conditions. These forward-looking statements are subject to assumptions, risks and uncertainties that may change at any time, and readers are therefore cautioned that actual results could differ materially from those expressed in any forward-looking statements. Factors that could cause the actual results to differ materially include: changes in national, regional and local economic and market conditions; legislative and regulatory matters (including the cost of compliance or failure to comply with applicable laws and regulations); increases in gaming taxes and fees in the jurisdictions in which the Company operates; litigation; increased competition; reliance on key personnel (including our Chief Executive Officer, President and Chief Financial Officer, and Chief Operating Officer); the level of the Company’s indebtedness and its ability to comply with covenants in its debt instruments; terrorist incidents; natural disasters; severe weather conditions (including weather or road conditions that limit access to the Company’s properties); the effects of environmental and structural building conditions; the effects of disruptions to the Company’s information technology and other systems and infrastructure; factors affecting the gaming, entertainment and hospitality industries generally; and other risks and uncertainties discussed in the Company’s filings with the SEC, including the “Risk Factors” sections of the Company’s most recent Annual Report on Form 10-K and Quarterly Reports on Form 10-Q. The Company undertakes no obligation to update any forward-looking statements as a result of new information, future developments or otherwise. All forward-looking statements in this press release are qualified in their entirety by this cautionary statement.
Non-GAAP Financial Measures
To supplement the Company’s consolidated financial statements presented in accordance with
The presentation of this additional information is not meant to be considered in isolation or as a substitute for measures of financial performance prepared in accordance with GAAP. In addition, other companies in gaming industry may calculate Adjusted EBITDA differently than the Company does.
The Company defines “Adjusted EBITDA” as earnings before interest and other non-operating income (expense), income taxes, depreciation and amortization, impairment of assets, severance expenses, preopening and related expenses, gain or loss on disposal of assets and businesses, share-based compensation expenses, non-cash lease expense, and other non-cash charges that are deemed to be not indicative of the Company’s core operating results, calculated before corporate overhead (which is not allocated to each reportable segment).
About Golden Entertainment
Golden Entertainment owns and operates a diversified entertainment platform, consisting of a portfolio of gaming and hospitality assets that focus on casino and branded tavern operations. Golden Entertainment owns eight casinos and 69 gaming taverns in
Golden Entertainment, Inc. Consolidated Statements of Operations (Unaudited, in thousands, except per share data) |
||||||||||||||||
|
|
Three Months Ended December 31, |
|
Year Ended December 31, |
||||||||||||
|
|
|
2023 |
|
|
|
2022 |
|
|
|
2023 |
|
|
|
2022 |
|
Revenues |
|
|
|
|
|
|
|
|
||||||||
Gaming |
|
$ |
138,682 |
|
|
$ |
185,020 |
|
|
$ |
674,301 |
|
|
$ |
760,906 |
|
Food and beverage |
|
|
45,096 |
|
|
|
45,421 |
|
|
|
182,408 |
|
|
|
175,363 |
|
Rooms |
|
|
31,737 |
|
|
|
32,639 |
|
|
|
124,649 |
|
|
|
122,324 |
|
Other |
|
|
15,176 |
|
|
|
16,630 |
|
|
|
71,791 |
|
|
|
63,126 |
|
Total revenues |
|
|
230,691 |
|
|
|
279,710 |
|
|
|
1,053,149 |
|
|
|
1,121,719 |
|
Expenses |
|
|
|
|
|
|
|
|
||||||||
Gaming |
|
|
72,803 |
|
|
|
105,553 |
|
|
|
379,929 |
|
|
|
428,984 |
|
Food and beverage |
|
|
34,130 |
|
|
|
34,770 |
|
|
|
135,373 |
|
|
|
131,863 |
|
Rooms |
|
|
16,179 |
|
|
|
15,787 |
|
|
|
62,297 |
|
|
|
56,414 |
|
Other operating |
|
|
5,193 |
|
|
|
6,036 |
|
|
|
22,415 |
|
|
|
19,889 |
|
Selling, general and administrative |
|
|
58,709 |
|
|
|
57,818 |
|
|
|
255,565 |
|
|
|
235,404 |
|
Depreciation and amortization |
|
|
21,758 |
|
|
|
24,229 |
|
|
|
88,933 |
|
|
|
100,123 |
|
(Gain) loss on disposal of assets |
|
|
(103 |
) |
|
|
(1 |
) |
|
|
(228 |
) |
|
|
934 |
|
Loss (gain) on sale of businesses |
|
|
2,650 |
|
|
|
— |
|
|
|
(303,179 |
) |
|
|
— |
|
Preopening expenses |
|
|
185 |
|
|
|
100 |
|
|
|
760 |
|
|
|
161 |
|
Impairment of assets |
|
|
12,072 |
|
|
|
— |
|
|
|
12,072 |
|
|
|
— |
|
Total expenses |
|
|
223,576 |
|
|
|
244,292 |
|
|
|
653,937 |
|
|
|
973,772 |
|
Operating income |
|
|
7,115 |
|
|
|
35,418 |
|
|
|
399,212 |
|
|
|
147,947 |
|
Non-operating expense |
|
|
|
|
|
|
|
|
||||||||
Interest expense, net |
|
|
(13,170 |
) |
|
|
(17,925 |
) |
|
|
(65,515 |
) |
|
|
(63,490 |
) |
Loss on debt extinguishment and modification |
|
|
(1,329 |
) |
|
|
(178 |
) |
|
|
(1,734 |
) |
|
|
(1,590 |
) |
Total non-operating expense, net |
|
|
(14,499 |
) |
|
|
(18,103 |
) |
|
|
(67,249 |
) |
|
|
(65,080 |
) |
(Loss) income before income tax provision |
|
|
(7,384 |
) |
|
|
17,315 |
|
|
|
331,963 |
|
|
|
82,867 |
|
Income tax provision |
|
|
(1,988 |
) |
|
|
(6,258 |
) |
|
|
(76,207 |
) |
|
|
(521 |
) |
Net (loss) income |
|
$ |
(9,372 |
) |
|
$ |
11,057 |
|
|
$ |
255,756 |
|
|
$ |
82,346 |
|
|
|
|
|
|
|
|
|
|
||||||||
Weighted-average common shares outstanding |
|
|
|
|
|
|
|
|
||||||||
Basic |
|
|
28,627 |
|
|
|
28,507 |
|
|
|
28,653 |
|
|
|
28,662 |
|
Diluted |
|
|
28,627 |
|
|
|
31,230 |
|
|
|
30,781 |
|
|
|
31,514 |
|
Net (loss) income per share |
|
|
|
|
|
|
|
|
||||||||
Basic |
|
$ |
(0.33 |
) |
|
$ |
0.39 |
|
|
$ |
8.93 |
|
|
$ |
2.87 |
|
Diluted |
|
$ |
(0.33 |
) |
|
$ |
0.35 |
|
|
$ |
8.31 |
|
|
$ |
2.61 |
|
Golden Entertainment, Inc. Reconciliation of Adjusted EBITDA (Unaudited, in thousands) |
||||||||||||||||
|
|
Three Months Ended December 31, |
|
Year Ended December 31, |
||||||||||||
|
|
|
2023 |
|
|
|
2022 |
|
|
|
2023 |
|
|
|
2022 |
|
Revenues |
|
|
|
|
|
|
|
|
||||||||
Nevada Casino Resorts (1) |
|
$ |
104,796 |
|
|
$ |
104,161 |
|
|
$ |
413,058 |
|
|
$ |
406,950 |
|
Nevada Locals Casinos (2) |
|
|
38,467 |
|
|
|
40,105 |
|
|
|
157,435 |
|
|
|
157,514 |
|
Maryland Casino Resort (3) |
|
|
— |
|
|
|
17,948 |
|
|
|
43,456 |
|
|
|
78,010 |
|
Nevada Taverns (4) |
|
|
27,763 |
|
|
|
26,884 |
|
|
|
109,215 |
|
|
|
109,965 |
|
Distributed Gaming (5) |
|
|
59,323 |
|
|
|
90,316 |
|
|
|
320,680 |
|
|
|
365,472 |
|
Corporate and other |
|
|
342 |
|
|
|
296 |
|
|
|
9,305 |
|
|
|
3,808 |
|
Total Revenues |
|
$ |
230,691 |
|
|
$ |
279,710 |
|
|
$ |
1,053,149 |
|
|
$ |
1,121,719 |
|
|
|
|
|
|
|
|
|
|
||||||||
Adjusted EBITDA |
|
|
|
|
|
|
|
|
||||||||
Nevada Casino Resorts (1) |
|
$ |
29,664 |
|
|
$ |
32,515 |
|
|
$ |
120,256 |
|
|
$ |
135,104 |
|
Nevada Locals Casinos (2) |
|
|
17,337 |
|
|
|
19,197 |
|
|
|
73,846 |
|
|
|
75,848 |
|
Maryland Casino Resort (3) |
|
|
— |
|
|
|
5,123 |
|
|
|
12,652 |
|
|
|
25,383 |
|
Nevada Taverns (4) |
|
|
8,175 |
|
|
|
7,872 |
|
|
|
32,682 |
|
|
|
37,610 |
|
Distributed Gaming (5) |
|
|
6,370 |
|
|
|
10,667 |
|
|
|
34,545 |
|
|
|
44,021 |
|
Corporate and other |
|
|
(12,786 |
) |
|
|
(11,690 |
) |
|
|
(51,459 |
) |
|
|
(50,886 |
) |
Total Adjusted EBITDA |
|
$ |
48,760 |
|
|
$ |
63,684 |
|
|
$ |
222,522 |
|
|
$ |
267,080 |
|
Adjustments |
|
|
|
|
|
|
|
|
||||||||
Depreciation and amortization |
|
|
(21,758 |
) |
|
|
(24,229 |
) |
|
|
(88,933 |
) |
|
|
(100,123 |
) |
Non-cash lease expense |
|
|
29 |
|
|
|
(52 |
) |
|
|
15 |
|
|
|
(165 |
) |
Share-based compensation |
|
|
(2,851 |
) |
|
|
(3,164 |
) |
|
|
(13,476 |
) |
|
|
(13,433 |
) |
Gain (loss) on disposal of assets |
|
|
103 |
|
|
|
1 |
|
|
|
228 |
|
|
|
(934 |
) |
(Loss) gain on sale of businesses |
|
|
(2,650 |
) |
|
|
— |
|
|
|
303,179 |
|
|
|
— |
|
Loss on debt extinguishment and modification |
|
|
(1,329 |
) |
|
|
(178 |
) |
|
|
(1,734 |
) |
|
|
(1,590 |
) |
Preopening and related expenses (6) |
|
|
(185 |
) |
|
|
(100 |
) |
|
|
(760 |
) |
|
|
(161 |
) |
Severance expenses |
|
|
(21 |
) |
|
|
(83 |
) |
|
|
(149 |
) |
|
|
(378 |
) |
Impairment of assets |
|
|
(12,072 |
) |
|
|
— |
|
|
|
(12,072 |
) |
|
|
— |
|
Other, net |
|
|
(2,240 |
) |
|
|
(639 |
) |
|
|
(11,342 |
) |
|
|
(3,939 |
) |
Interest expense, net |
|
|
(13,170 |
) |
|
|
(17,925 |
) |
|
|
(65,515 |
) |
|
|
(63,490 |
) |
Income tax provision |
|
|
(1,988 |
) |
|
|
(6,258 |
) |
|
|
(76,207 |
) |
|
|
(521 |
) |
Net (loss) income |
|
$ |
(9,372 |
) |
|
$ |
11,057 |
|
|
$ |
255,756 |
|
|
$ |
82,346 |
|
(1) |
Comprised of The STRAT Hotel, Casino & Tower, Aquarius Casino Resort and Edgewater Casino Resort. |
(2) |
Comprised of Arizona Charlie’s Boulder, Arizona Charlie’s Decatur, Gold Town Casino, Lakeside Casino & RV Park and Pahrump Nugget Hotel Casino. |
(3) |
Comprised of the operations of the Rocky Gap Casino Resort, which was sold on July 25, 2023. |
(4) |
Comprised of the operations of the Company’s 69 branded tavern locations. |
(5) |
Comprised of distributed gaming operations in |
(6) |
Preopening and related expenses consist of labor, food, utilities, training, initial licensing, rent and organizational costs incurred in connection with the opening of branded tavern and casino locations as well as food and beverage and other venues within the Company’s casino locations. |
View source version on businesswire.com: https://www.businesswire.com/news/home/20240229128609/en/
Golden Entertainment, Inc.
Charles H. Protell
President and Chief Financial Officer
(702) 893-7777
Investor Relations
Richard Land
JCIR
(212) 835-8500 or gden@jcir.com
Source: Golden Entertainment, Inc.
FAQ
What was Golden Entertainment's (GDEN) fourth-quarter revenue?
What was the full-year 2023 revenue for Golden Entertainment (GDEN)?
How much debt did Golden Entertainment (GDEN) repay in the fourth quarter of 2023?
What was the net income for Golden Entertainment (GDEN) in full-year 2023?
When did Golden Entertainment (GDEN) complete the sale of its Nevada distributed gaming business?
What is the quarterly cash dividend per share initiated by Golden Entertainment (GDEN)?
What was the Adjusted EBITDA for Golden Entertainment (GDEN) in Q4 2023?
How much debt was outstanding for Golden Entertainment (GDEN) as of December 31, 2023?
What caused the decline in Q4 2023 net income for Golden Entertainment (GDEN)?
Why did Golden Entertainment's (GDEN) Adjusted EBITDA decline in full-year 2023 compared to 2022?
