Boyd Gaming Reports Fourth Quarter, Full Year 2015 Results
Fourth-Quarter 2015 Highlights
- Adjusted EBITDA Grows 13%
- Companywide Operating Margins Improve Nearly 280 Basis Points
- Las Vegas Locals Posts Highest Fourth-Quarter Adjusted EBITDA in 8 Years
Full-Year 2015 Highlights
- Company Achieves Full-Year Adjusted EBITDA of $630 Million
- Net Revenue and Double-Digit Adjusted EBITDA Growth in Every Quarter of 2015

LAS VEGAS, Feb. 16, 2016 /PRNewswire/ -- Boyd Gaming Corporation (NYSE: BYD) today reported financial results for the fourth quarter and full year ended December 31, 2015.  

Boyd Gaming logo.

Boyd Gaming reported fourth quarter 2015 net revenues of $542.7 million, an increase of 2.1% from $531.6 million for the same quarter in 2014.  Total Adjusted EBITDA(1) was $154.2 million, up 13.1% from $136.4 million for the year-ago period. 

Keith Smith, President and Chief Executive Officer of Boyd Gaming, said: "The fourth quarter of 2015 was a strong conclusion to a year of solid progress for our Company.  Our operating teams continued to drive profitable revenue growth, identify additional efficiencies in our business, and successfully leverage new amenities, all of which contributed to our fifth consecutive quarter of revenue and double-digit Adjusted EBITDA growth. We were particularly encouraged by the performance of our Las Vegas Locals business, as a strengthening economy and effective marketing programs resulted in the segment's strongest fourth-quarter results since 2007. After a strong performance in 2015, we are well-positioned for continued growth and success this year."

Adjusted Earnings(1) for the fourth quarter 2015 were $18.2 million, or $0.16 per share, compared to a loss of $0.1 million, or breakeven on a per-share basis, for the same period in 2014.   The calculations of Adjusted Earnings, Adjusted Earnings per share, and pro forma results reflecting Borgata on a comparable basis for all periods are presented in tables at the end of this press release.

On a GAAP basis, the Company reported a net loss of $6.9 million, or $0.06 per share, for the fourth quarter 2015, compared to a net loss of $32.4 million, or $0.29 per share, for the year-ago period.  During the fourth quarter of 2015, the Company reported noncash intangible asset impairment charges of $17.5 million and a pretax loss on early extinguishments of debt of $8.4 million.  Results for the prior-year period included noncash impairment charges of $40.6 million, primarily due to the impairments of intangible assets.  These charges are not included in Adjusted Earnings or Adjusted Earnings per share.


(1) See footnotes at the end of the release for additional information relative to non-GAAP financial measures.

Key Operations Review

Las Vegas Locals
In the Las Vegas Locals segment, fourth-quarter 2015 net revenues rose 4.6% to $158.8 million, compared to $151.7 million in the year-ago period.  Fourth-quarter 2015 Adjusted EBITDA was $44.0 million ‒ an increase of 10.7% from $39.8 million in the fourth quarter of 2014 – marking the segment's best fourth-quarter Adjusted EBITDA performance in eight years.  Results reflect broad-based growth in both gaming and non-gaming revenues.  Operating margins improved more than 150 basis points year-over-year, driving the segment's third consecutive quarter of double-digit Adjusted EBITDA gains.

Downtown Las Vegas
In the Downtown Las Vegas segment, net revenues were $62.5 million in the fourth quarter of 2015, up 4.8% from $59.6 million in the year-ago period.  Adjusted EBITDA was $16.2 million, a 23.4% increase from $13.1 million in the fourth quarter of 2014, marking the segment's sixth straight quarter of Adjusted EBITDA growth.  Results benefitted from significant increases in visitation throughout the Downtown area, as well as lower fuel costs at the Company's Hawaiian charter service.

Midwest and South; Peninsula
In the Midwest and South segment, fourth-quarter 2015 net revenues were $200.9 million, up from $200.0 million in the year-ago quarter.  Adjusted EBITDA rose 8.1% to $43.3 million, compared to $40.1 million in the fourth quarter of 2014.

During the fourth quarter of 2015, the Peninsula segment reported net revenues of $120.5 million, increasing from $120.2 million in the year-ago period. Adjusted EBITDA was $43.0 million, up 1.9% from $42.2 million in the fourth quarter of 2014. 

Ongoing refinements to marketing programs and operations drove the fifth consecutive quarter of revenue and Adjusted EBITDA growth in the two segments, as margins improved nearly 120 basis points year-over-year on a combined basis.  Results were led by double-digit Adjusted EBITDA gains at Blue Chip, Diamond Jo Dubuque, Treasure Chest and IP.

Borgata
Borgata reported fourth quarter 2015 net revenues of $193.0 million, a 7.7% increase from the $179.1 million in revenues reported in the year-ago period. Fourth-quarter Adjusted EBITDA at Borgata was $45.9 million, up 27.3% from $36.0 million in the fourth quarter of 2014. 

The Company applies the equity method of accounting to its 50% investment in Borgata, and the Company's share of Borgata's Adjusted EBITDA was $22.9 million for the fourth quarter of 2015, compared to $18.0 million for the prior-year period.

Borgata's fourth-quarter results reflect successful efforts to leverage the property's market-leading amenities, more efficient marketing initiatives, and higher table hold. Borgata achieved fourth-quarter records for gross slot win and hotel rooms occupied, as well as a record gross gaming market share of 30.4%.  

Full Year 2015 Results
For the full year ended December 31, 2015, Boyd Gaming reported pro forma net revenues of $2.20 billion, an increase of 2.7% from $2.14 billion in pro forma net revenues reported for the year-ago period.  Total pro forma Adjusted EBITDA was $629.5 million, an increase of 15.4% compared to $545.3 million in the prior year.

Effective September 30, 2014, the Company deconsolidated Borgata and is accounting for its 50% investment in Borgata by applying the equity method for periods subsequent to that date.  The prior-year pro forma amounts reflect the results for Borgata on a comparable equity method basis to the current period presentation.

Adjusted Earnings for the year ended December 31, 2015, were $89.7 million, or $0.79 per share, compared to $1.3 million, or $0.01 per share, for the year ended December 31, 2014.

On a GAAP basis, Boyd Gaming reported net income of $47.2 million, or $0.42 per share, for the full year ended December 31, 2015.  By comparison, the Company reported a net loss of $53.0 million, or $0.48 per share, for the prior-year period.  The Company's results for the year ended December 31, 2015, included noncash impairment charges of $18.6 million and pretax losses on the early extinguishments of debt of $40.7 million.  In addition, settlements of previous years' income tax appeals reduced the 2015 income tax provision by $30.4 million.  Results for the prior year included impairment charges of $60.8 million.  These amounts are excluded from Adjusted Earnings and Adjusted Earnings per share.

Balance Sheet Statistics
As of December 31, 2015, Boyd Gaming had cash on hand of $158.8 million, including $29.6 million related to Peninsula.  Total debt was $3.32 billion, of which $1.01 billion was related to Peninsula. As a result of the deconsolidation, Borgata is no longer included in the Company's balance sheet. Borgata had cash on hand of $44.1 million and total debt of $697.6 million at December 31, 2015. 

Full Year 2016 Guidance
For the full year 2016, Boyd Gaming projects total Adjusted EBITDA, including Peninsula and 50% of Borgata's Adjusted EBITDA, of $635 million to $655 million.

Conference Call Information
Boyd Gaming will host its conference call to discuss fourth quarter and full year 2015 results today, February 16, at 5:00 p.m. Eastern.  The conference call number is (888) 317-6003, passcode 7592271.  Please call up to 15 minutes in advance to ensure you are connected prior to the start of the call. 

The conference call will also be available live on the Internet at www.boydgaming.com, or: https://www.webcaster4.com/Webcast/Page/964/13211

Following the call's completion, a replay will be available by dialing (877) 344-7529 today, February 16, beginning at 7:00 p.m. Eastern and continuing through Wednesday, February 24, at 11:59 p.m. Eastern.  The conference number for the replay will be 10080449.  The replay will also be available on the Internet at www.boydgaming.com.

 

BOYD GAMING CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (a)
(Unaudited)


































Three Months Ended


Year Ended


December 31,


December 31,

(In thousands, except per share data)

2015


2014


2015


2014

Revenues








Gaming

$

456,433



$

448,226



$

1,847,167



$

2,307,565


Food and beverage

76,524



76,168



307,442



408,236


Room

40,175



38,150



163,509



248,222


Other

31,253



29,596



123,959



154,170


Gross revenues

604,385



592,140



2,442,077



3,118,193


Less promotional allowances

61,711



60,547



242,645



416,874


Net revenues

542,674



531,593



2,199,432



2,701,319


Operating costs and expenses








Gaming

223,886



220,395



900,922



1,087,901


Food and beverage

41,716



42,417



168,096



222,393


Room

9,804



9,576



41,298



51,906


Other

19,570



20,540



80,508



112,248


Selling, general and administrative

79,764



80,035



322,420



429,529


Maintenance and utilities

23,583



25,399



104,548



156,736


Depreciation and amortization

51,867



52,799



207,118



251,044


Corporate expense

24,928



23,021



76,941



75,626


Project development, preopening and writedowns

2,689



5,476



6,907



14,390


Impairments of assets

17,500



40,575



18,565



60,780


Other operating items, net

565



(261)



907



(2,124)


Total operating costs and expenses

495,872



519,972



1,928,230



2,460,429


Boyd's share of Borgata's operating income (a)

15,551



10,626



73,421



10,626


Operating income

62,353



22,247



344,623



251,516


Other expense (income)








Interest income

(462)



(467)



(1,858)



(1,879)


Interest expense, net of amounts capitalized

53,966



57,168



224,590



283,387


Loss on early extinguishments of debt

8,400



407



40,733



1,536


Other, net

35



(450)



3,676



48


Boyd's share of Borgata's non-operating items, net (a)

7,968



9,309



37,422



9,309


Total other expense, net

69,907



65,967



304,563



292,401


Income (loss) before income taxes

(7,554)



(43,720)



40,060



(40,885)


Income taxes benefit (provision)

685



11,297



7,174



(753)


Net income (loss)

(6,869)



(32,423)



47,234



(41,638)


Net income attributable to noncontrolling interest (a)







(11,403)


Net income (loss) attributable to Boyd Gaming Corporation

$

(6,869)



$

(32,423)



$

47,234



$

(53,041)










Basic net income (loss) per common share

$

(0.06)



$

(0.29)



$

0.42



$

(0.48)


Weighted average basic shares outstanding

113,672



110,352



112,789



109,979










Diluted net income (loss) per common share

$

(0.06)



$

(0.29)



$

0.42



$

(0.48)


Weighted average diluted shares outstanding

113,672



110,352



113,676



109,979


_______________________________________________

(a) 

Due to the deconsolidation of Borgata on September 30, 2014, the Company has accounted for its 50% investment in Borgata by applying the equity method for the three months and year ended December 31, 2015, and for the three months ended December 31, 2014. For the year ended December 31, 2014, Boyd Gaming consolidated the financial results of Borgata for the first nine months of the period, and recorded the results by applying the equity method for the last three months of the year. Please see the unaudited pro forma financial results also presented in this release for a comparison of Boyd Gaming's financial results reflecting Borgata on the equity method for all periods presented.

 

 

BOYD GAMING CORPORATION
SUPPLEMENTAL INFORMATION
Reconciliation of Adjusted EBITDA to Operating Income (a)
(Unaudited)



















Three Months Ended


Year Ended


December 31,


December 31,

(In thousands)

2015


2014


2015


2014

Net Revenues by Reportable Segment








Las Vegas Locals

$

158,750



$

151,732



$

610,107



$

592,652


Downtown Las Vegas

62,469



59,611



234,191



224,275


Midwest and South

200,947



200,005



852,288



831,477


Peninsula

120,508



120,245



502,846



493,851


Borgata (b)







559,064


  Net revenues

$

542,674



$

531,593



$

2,199,432



$

2,701,319










Adjusted EBITDA by Reportable Segment








Las Vegas Locals

$

43,999



$

39,757



$

157,312



$

144,397


Downtown Las Vegas

16,186



13,116



49,314



37,309


Midwest and South

43,344



40,087



196,822



169,977


Peninsula

42,963



42,163



184,120



175,081


  Wholly owned property Adjusted EBITDA

146,492



135,123



587,568



526,764


Corporate expense (c)

(15,177)



(16,777)



(60,177)



(59,420)


  Wholly owned Adjusted EBITDA

131,315



118,346



527,391



467,344


Borgata (b)

22,932



18,019



102,095



137,936


  Adjusted EBITDA

154,247



136,365



629,486



605,280










Other operating costs and expenses








Deferred rent

855



904



3,428



3,618


Depreciation and amortization

51,867



52,799



207,118



251,044


Share-based compensation expense

11,037



7,235



19,264



18,666


Project development, preopening and writedowns

2,689



5,476



6,907



14,390


Impairments of assets

17,500



40,575



18,565



60,780


Other operating items, net

565



(261)



907



(2,124)


Boyd's share of Borgata's other operating costs and expenses

7,381



7,390



28,674



7,390


Total other operating costs and expenses

91,894



114,118



284,863



353,764


Operating income

62,353



22,247



344,623



251,516


Other expense (income)








Interest income

(462)



(467)



(1,858)



(1,879)


Interest expense, net of amounts capitalized

53,966



57,168



224,590



283,387


Loss on early extinguishments of debt

8,400



407



40,733



1,536


Other, net

35



(450)



3,676



48


Boyd's share of Borgata's non-operating items, net

7,968



9,309



37,422



9,309


Total other expense, net

69,907



65,967



304,563



292,401


Income (loss) before income taxes

(7,554)



(43,720)



40,060



(40,885)


Income taxes benefit (provision)

685



11,297



7,174



(753)


Net income (loss)

(6,869)



(32,423)



47,234



(41,638)


Net income attributable to noncontrolling interest







(11,403)


Net income (loss) attributable to Boyd Gaming Corporation

$

(6,869)



$

(32,423)



$

47,234



$

(53,041)


_______________________________________________

 

 

BOYD GAMING CORPORATION
SUPPLEMENTAL INFORMATION
Reconciliation of Adjusted EBITDA to Operating Income (a)
(Unaudited)
(Continued)


(a) See note (a) on Condensed Consolidated Statements of Operations.


(b) The following table reflects the financial results of Borgata as reported by Boyd Gaming in its financial statements under the respective method of accounting for the indicated period. For the three months and year ended December 31, 2015, and for the three months ended December 31, 2014, Boyd Gaming accounted for its 50% investment in Borgata by applying the equity method. For the year ended December 31, 2014, Boyd Gaming consolidated the financial results of Borgata for the first nine months of the period, and recorded the results by applying the equity method for the last three months of the year.



















Three Months Ended


Year Ended


December 31,


December 31,

(In thousands)

2015


2014


2015


2014

Revenues reported for Borgata








  Consolidated

$



$



$



$

559,064


  Equity Method








Total

$



$



$



$

559,064










Adjusted EBITDA reported for Borgata








  Consolidated

$



$



$



$

119,917


  Equity Method

22,932



18,019



102,095



18,019


Total

$

22,932



$

18,019



$

102,095



$

137,936



(c) Reconciliation of corporate expense:



















Three Months Ended


Year Ended


December 31,


December 31,

(In thousands)

2015


2014


2015


2014

Corporate expense as reported on Consolidated Statements of Operations

$

24,928



$

23,021



$

76,941



$

75,626


  Corporate share-based compensation expense

(9,751)



(6,244)



(16,764)



(16,206)


  Corporate expense as reported on the above table

$

15,177



$

16,777



$

60,177



$

59,420


 

 

BOYD GAMING CORPORATION
SUPPLEMENTAL INFORMATION
Reconciliation of Net Income (Loss) to Adjusted Earnings (Loss) and Net Income (Loss) Per Share

to Adjusted Earnings (Loss) Per Share (a)
(Unaudited)



















Three Months Ended


Year Ended


December 31,


December 31,

(In thousands, except per share data)

2015


2014


2015


2014

Net income (loss) attributable to Boyd Gaming Corporation

$

(6,869)



$

(32,423)



$

47,234



$

(53,041)


Pretax adjustments related to Boyd Gaming:








  Project development, preopening and writedowns

2,689



5,476



6,907



13,747


  Impairments of assets

17,500



40,575



18,565



60,780


  Other operating items, net

565



(262)



907



(14)


  Loss on early extinguishments of debt

8,400



407



40,733



1,536


  Other, net

35



(450)



3,676



(39)










Pretax adjustments related to Borgata (b):








  Preopening expenses







269


  Loss on early extinguishments of debt

12



370



9,448



370


  Valuation adjustments related to consolidation, net







(1,901)


  Asset transactions costs



5





379


  Other operating items, net

255





(353)



(2,111)


  Total adjustments

29,456



46,121



79,883



73,016










Income tax effect for above adjustments

(4,431)



(13,834)



(7,002)



(20,379)


Impact of tax audit settlements on provision





(30,428)




Impact on noncontrolling interest, net







1,686


Adjusted earnings (loss)

$

18,156



$

(136)



$

89,687



$

1,282










Net income (loss) per share attributable to Boyd Gaming Corporation

$

(0.06)



$

(0.29)



$

0.42



$

(0.48)


Pretax adjustments related to Boyd Gaming:








  Project development, preopening and writedowns

0.03



0.05



0.06



0.13


  Impairments of assets

0.15



0.37



0.16



0.55


  Other operating items, net

0.01





0.01




  Loss on early extinguishments of debt

0.07



0.01



0.36



0.01


  Other, net



(0.01)



0.03












Pretax adjustments related to Borgata (b):








  Preopening expenses








  Loss on early extinguishments of debt





0.08




  Valuation adjustments related to consolidation, net







(0.02)


  Asset transactions costs








  Other operating items, net







(0.02)


  Total adjustments

0.26



0.42



0.70



0.65










Income tax effect for above adjustments

(0.04)



(0.13)



(0.06)



(0.18)


Impact of tax audit settlements on provision





(0.27)




Impact on noncontrolling interest, net







0.02


Adjusted earnings (loss) per share

$

0.16



$



$

0.79



$

0.01










Weighted average shares outstanding

114,493



110,352



113,676



110,893


_______________________________________________

(a)

See note (a) on Condensed Consolidated Statements of Operations.

(b) 

For periods after the September 30, 2014, date of Borgata's deconsolidation, the calculation includes Boyd's share of the adjusting items. Prior to this date, the calculation includes 100% of the adjusting items for Borgata.

 

 



















BOYD GAMING CORPORATION

SUPPLEMENTAL INFORMATION

Condensed Consolidating Statements of Operations

Three Months Ended December 31, 2015 (a)

(Unaudited)












Boyd Gaming Wholly Owned



(In thousands, except per share data)


Excluding

Peninsula

Segment


Peninsula

Segment


Eliminations


Boyd Gaming

Consolidated

Revenues









Gaming


$

344,758



$

111,675



$



$

456,433


Food and beverage


66,873



9,651





76,524


Room


40,175







40,175


Other


31,487



4,337



(4,571)



31,253


Gross revenues


483,293



125,663



(4,571)



604,385


Less promotional allowances


56,556



5,155





61,711


  Net revenues


426,737



120,508



(4,571)



542,674


Operating costs and expenses









Gaming


171,481



52,405





223,886


Food and beverage


35,323



6,393





41,716


Room


9,804







9,804


Other


17,103



7,038



(4,571)



19,570


Selling, general and administrative


66,605



13,159





79,764


Maintenance and utilities


20,463



3,120





23,583


Depreciation and amortization


34,791



17,076





51,867


Corporate expense


24,636



292





24,928


Project development, preopening and writedowns


2,330



359





2,689


Impairments of assets


17,500







17,500


Other operating items, net


469



96





565


  Total operating costs and expenses


400,505



99,938



(4,571)



495,872


Boyd's share of Borgata's operating income


15,551







15,551


Operating income


41,783



20,570





62,353


Other expense (income)









Interest income


(1)



(461)





(462)


Interest expense, net of amounts capitalized


35,936



18,030





53,966


Loss on early extinguishments of debt


8,195



205





8,400


Other, net


(39)



74





35


Boyd's share of Borgata's non-operating items, net


7,968







7,968


     Total other expense, net


52,059



17,848





69,907


Income (loss) before income taxes


(10,276)



2,722





(7,554)


Income taxes benefit (provision)


5,254



(4,569)





685


Net loss attributable to Boyd Gaming Corporation


$

(5,022)



$

(1,847)



$



$

(6,869)











Basic net loss per common share








$

(0.06)


Weighted average basic shares outstanding








113,672











Diluted net loss per common share








$

(0.06)


Weighted average diluted shares outstanding








113,672


_______________________________________________

(a)

See note (a) on Condensed Consolidated Statements of Operations.

 

 



















BOYD GAMING CORPORATION

SUPPLEMENTAL INFORMATION

Condensed Consolidating Statements of Operations

Three Months Ended December 31, 2014 (a)

(Unaudited)












Boyd Gaming Wholly Owned



(In thousands, except per share data)


Excluding Peninsula Segment


Peninsula Segment


Eliminations


Boyd Gaming Consolidated

Revenues









Gaming


$

336,717



$

111,509



$



$

448,226


Food and beverage


66,794



9,374





76,168


Room


38,150







38,150


Other


29,834



4,258



(4,496)



29,596


Gross revenues


471,495



125,141



(4,496)



592,140


Less promotional allowances


55,653



4,894





60,547


  Net revenues


415,842



120,247



(4,496)



531,593


Operating costs and expenses









Gaming


167,742



52,653





220,395


Food and beverage


35,750



6,667





42,417


Room


9,576







9,576


Other


17,764



7,272



(4,496)



20,540


Selling, general and administrative


67,286



12,749





80,035


Maintenance and utilities


22,160



3,239





25,399


Depreciation and amortization


34,320



18,479





52,799


Corporate expense


22,740



281





23,021


Project development, preopening and writedowns


4,706



770





5,476


Impairments of assets


38,875



1,700





40,575


Other operating items, net




(261)





(261)


  Total operating costs and expenses


420,919



103,549



(4,496)



519,972


Boyd's share of Borgata's operating income


10,626







10,626


Operating income


5,549



16,698





22,247


Other expense (income)









Interest income


(1)



(466)





(467)


Interest expense, net of amounts capitalized


38,215



18,953





57,168


Loss on early extinguishments of debt




407





407


Other, net


(721)



271





(450)


Boyd's share of Borgata's non-operating items, net


9,309







9,309


     Total other expense, net


46,802



19,165





65,967


Loss before income taxes


(41,253)



(2,467)





(43,720)


Income taxes benefit (provision)


14,338



(3,041)





11,297


Net loss attributable to Boyd Gaming Corporation


$

(26,915)



$

(5,508)



$



$

(32,423)











Basic net loss per common share








$

(0.29)


Weighted average basic shares outstanding








110,352











Diluted net loss per common share








$

(0.29)


Weighted average diluted shares outstanding








110,352


_______________________________________________

(a)

See note (a) on Condensed Consolidated Statements of Operations.

 

 



















BOYD GAMING CORPORATION

SUPPLEMENTAL INFORMATION

Condensed Consolidating Statements of Operations

Year Ended December 31, 2015 (a)

(Unaudited)












Boyd Gaming Wholly Owned



(In thousands, except per share data)


Excluding

Peninsula

Segment


Peninsula

Segment


Eliminations


Boyd Gaming

Consolidated

Revenues









Gaming


$

1,380,712



$

466,455



$



$

1,847,167


Food and beverage


268,567



38,875





307,442


Room


163,509







163,509


Other


125,289



17,914



(19,244)



123,959


Gross revenues


1,938,077



523,244



(19,244)



2,442,077


Less promotional allowances


222,247



20,398





242,645


  Net revenues


1,715,830



502,846



(19,244)



2,199,432


Operating costs and expenses









Gaming


684,093



216,829





900,922


Food and beverage


142,653



25,443





168,096


Room


41,298







41,298


Other


69,638



30,114



(19,244)



80,508


Selling, general and administrative


270,122



52,298





322,420


Maintenance and utilities


91,262



13,286





104,548


Depreciation and amortization


138,522



68,596





207,118


Corporate expense


75,420



1,521





76,941


Project development, preopening and writedowns


5,657



1,250





6,907


Impairments of assets


18,565







18,565


Other operating items, net


711



196





907


  Total operating costs and expenses


1,537,941



409,533



(19,244)



1,928,230


Boyd's share of Borgata's operating income


73,421







73,421


Operating income


251,310



93,313





344,623


Other expense (income)









Interest income


(5)



(1,853)





(1,858)


Interest expense, net of amounts capitalized


151,281



73,309





224,590


Loss on early extinguishments of debt


38,647



2,086





40,733


Other, net


3,302



374





3,676


Boyd's share of Borgata's non-operating items, net


37,422







37,422


     Total other expense, net


230,647



73,916





304,563


Income before income taxes


20,663



19,397





40,060


Income taxes benefit (provision)


25,288



(18,114)





7,174


Net income attributable to Boyd Gaming Corporation


$

45,951



$

1,283



$



$

47,234











Basic net income per common share








$

0.42


Weighted average basic shares outstanding








112,789











Diluted net income per common share








$

0.42


Weighted average diluted shares outstanding








113,676


_______________________________________________

(a)

See note (a) on Condensed Consolidated Statements of Operations.

 

 































BOYD GAMING CORPORATION

SUPPLEMENTAL INFORMATION

Condensed Consolidating Statements of Operations

Year Ended December 31, 2014 (a)

(Unaudited)


















Boyd Gaming Wholly Owned







(In thousands, except per share data)


Excluding

Peninsula

Segment


Peninsula Segment


Eliminations


Total


Borgata (b)


Eliminations


Boyd Gaming

Consolidated

Revenues















Gaming


$

1,341,780



$

457,944



$



$

1,799,724



$

507,841



$



$

2,307,565


Food and beverage


265,642



37,762





303,404



104,832





408,236


Room


157,427







157,427



90,795





248,222


Other


122,969



17,873



(18,605)



122,237



31,933





154,170


Gross revenues


1,887,818



513,579



(18,605)



2,382,792



735,401





3,118,193


Less promotional allowances


220,809



19,728





240,537



176,337





416,874


  Net revenues


1,667,009



493,851



(18,605)



2,142,255



559,064





2,701,319


Operating costs and expenses















Gaming


671,081



217,333





888,414



199,487





1,087,901


Food and beverage


143,349



25,381





168,730



53,663





222,393


Room


41,132







41,132



10,774





51,906


Other


73,640



31,131



(18,605)



86,166



26,082





112,248


Selling, general and administrative


277,415



50,184





327,599



101,930





429,529


Maintenance and utilities


96,179



13,347





109,526



47,210





156,736


Depreciation and amortization


135,003



73,912





208,915



42,129





251,044


Corporate expense


73,997



1,629





75,626







75,626


Project development, preopening and writedowns


11,983



1,764





13,747



643





14,390


Impairments of assets


59,080



1,700





60,780







60,780


Other operating items, net


165



(178)





(13)



(2,111)





(2,124)


  Total operating costs and expenses


1,583,024



416,203



(18,605)



1,980,622



479,807





2,460,429


Boyd's share of Borgata's operating income


50,255







50,255





(39,629)



10,626


Operating income


134,240



77,648





211,888



79,257



(39,629)



251,516


Other expense (income)















Interest income


(5)



(1,874)





(1,879)







(1,879)


Interest expense, net of amounts capitalized


153,455



76,605





230,060



53,327





283,387


Loss on early extinguishments of debt




1,536





1,536







1,536


Other, net


(318)



366





48







48


Boyd's share of Borgata's non-operating items, net


37,535







37,535





(28,226)



9,309


     Total other expense, net


190,667



76,633





267,300



53,327



(28,226)



292,401


Income (loss) before income taxes


(56,427)



1,015





(55,412)



25,930



(11,403)



(40,885)


Income taxes benefit (provision)


16,795



(14,424)





2,371



(3,124)





(753)


Net income (loss)


(39,632)



(13,409)





(53,041)



22,806



(11,403)



(41,638)


Net income attributable to noncontrolling interest












(11,403)



(11,403)


Net income (loss) attributable to Boyd Gaming Corporation


$

(39,632)



$

(13,409)



$



$

(53,041)



$

22,806



$

(22,806)



$

(53,041)

















Basic net loss per common share








$

(0.48)







$

(0.48)


Weighted average basic shares outstanding








109,979







109,979

















Diluted net loss per common share








$

(0.48)







$

(0.48)


Weighted average diluted shares outstanding








109,979







109,979


_______________________________________________

(a)

See note (a) on Condensed Consolidated Statements of Operations.



(b)

Borgata's financial results include the impact of certain valuation adjustments made upon consolidation. These valuation adjustments are not pushed down to Borgata and are therefore not reflected in Borgata's standalone financial statements.

 

 

MARINA DISTRICT DEVELOPMENT COMPANY, LLC
dba BORGATA HOTEL CASINO AND SPA
CONSOLIDATED STATEMENTS OF OPERATIONS (a)
(Unaudited)



















Three Months Ended


Year Ended


December 31,


December 31,

(In thousands)

2015


2014


2015


2014

Revenues








Gaming

$

179,096



$

164,729



$

728,117



$

672,570


Food and beverage

33,472



33,564



144,992



138,396


Room

28,723



27,513



122,282



118,308


Other

8,754



9,241



41,368



41,174


Gross revenues

250,045



235,047



1,036,759



970,448


Less promotional allowances

57,092



55,900



232,593



232,237


Net revenues

192,953



179,147



804,166



738,211


Operating costs and expenses








Gaming

67,479



68,700



276,474



268,187


Food and beverage

17,139



17,596



73,424



71,259


Room

3,309



3,302



14,379



14,076


Other

7,174



7,871



36,825



33,953


Selling, general and administrative

37,482



30,968



138,769



132,898


Maintenance and utilities

14,506



14,672



60,105



61,740


Depreciation and amortization

14,245



14,796



58,047



58,969


Preopening expenses







269


Other operating items, net

517



(9)



(699)



(1,746)


Total operating costs and expenses

161,851



157,896



657,324



639,605


Operating income

31,102



21,251



146,842



98,606


Other expense








Interest expense, net of amounts capitalized

12,494



17,431



59,681



70,758


Loss on early extinguishments of debt

22



740



18,895



740


Total other expense

12,516



18,171



78,576



71,498


Income before state income taxes

18,586



3,080



68,266



27,108


State income tax benefit (provision)

(3,420)



(446)



3,731



(3,399)


Net income

$

15,166



$

2,634



$

71,997



$

23,709


















Reconciliation of Adjusted EBITDA to Operating Income (a)






Three Months Ended


Year Ended


December 31,


December 31,

(In thousands)

2015


2014


2015


2014

Adjusted EBITDA

$

45,864



$

36,038



$

204,190



$

156,098


Less:








Depreciation and amortization

14,245



14,796



58,047



58,969


Preopening expenses







269


Other operating items, net

517



(9)



(699)



(1,746)


Operating income

$

31,102



$

21,251



$

146,842



$

98,606


_______________________________________________

(a) 

These financial statements present the financial results reported by Borgata on a standalone basis and do not include consolidation adjustments recorded by Boyd Gaming during the period that Boyd Gaming consolidated Borgata.

 

Boyd Gaming Corporation
Unaudited Supplemental Pro Forma Information

Boyd Gaming Corporation ("Boyd Gaming") and MGM Resorts International ("MGM") each originally held a 50% interest in Marina District Development Holding Co., LLC ("Holding Company"). Holding Company owns all the equity interests in Marina District Development Company, LLC, d.b.a. Borgata Hotel Casino and Spa ("Borgata"). Boyd Gaming is the managing member of Holding Company and is responsible for the day-to-day operations of Borgata.

In February 2010, Boyd Gaming entered into an agreement with MGM to amend the operating agreement to, among other things, facilitate the transfer of MGM's interest in Holding Company ("MGM Interest") to a divestiture trust (the "Divestiture Trust") established for the purpose of selling the MGM Interest to a third party. The proposed sale of the MGM Interest through the Divestiture Trust was part of a then-proposed settlement agreement between MGM and the New Jersey Department of Gaming Enforcement (the "NJDGE").

On March 17, 2010, MGM announced that its settlement agreement with the NJDGE had been approved by the New Jersey Casino Control Commission ("NJCCC"). MGM transferred the MGM Interest into the Divestiture Trust on March 24, 2010, and Boyd Gaming determined that it had control, as defined in the relevant accounting literature, of Holding Company and commenced consolidating the business as of that date.  Subsequent to a Joint Petition of MGM, Boyd Gaming and Holding Company, on February 13, 2013, the NJCCC approved amendments to the settlement agreement which permitted MGM to file an application for a statement of compliance, which, if approved, would permit MGM to reacquire its interest in Holding Company.

The NJCCC approved MGM's application for licensure on September 10, 2014. On September 30, 2014, the Divestiture Trust was dissolved and MGM reacquired its Borgata ownership interest and its substantive participation rights in the management of Borgata. As a result, Boyd Gaming deconsolidated Borgata as of the close of business on September 30, 2014, and is accounting for its investment in Borgata applying the equity method for periods subsequent to the deconsolidation.

The following unaudited supplemental pro forma information for three months and year ended December 31, 2015 and 2014, give effect to:

  • the deconsolidation by Boyd Gaming of Holding Company, and
  • the recording by Boyd Gaming using the equity method of accounting for its 50% share of the operating results of Holding Company for the periods presented.

The unaudited supplemental pro forma information assumes that these transactions occurred as of January 1, 2013.

The unaudited supplemental pro forma information has been prepared based upon currently available information and assumptions that are deemed appropriate by Boyd Gaming's management. The pro forma information is for informational purposes only and is not intended to be indicative of Boyd Gaming's actual results that would have been reported had the transactions occurred on the date indicated, nor does the information represent a forecast of Boyd Gaming's financial results for any future period.

 

BOYD GAMING CORPORATION
SUPPLEMENTAL PRO FORMA INFORMATION
Pro Forma Condensed Consolidated Statements of Operations
(Unaudited)



















Three Months Ended


Year Ended


December 31,


December 31,

(In thousands, except per share data)

2015


2014


2015


2014

Revenues








Gaming

$

456,433



$

448,226



$

1,847,167



$

1,799,724


Food and beverage

76,524



76,168



307,442



303,404


Room

40,175



38,150



163,509



157,427


Other

31,253



29,596



123,959



122,237


Gross revenues

604,385



592,140



2,442,077



2,382,792


Less promotional allowances

61,711



60,547



242,645



240,537


Net revenues

542,674



531,593



2,199,432



2,142,255


Operating costs and expenses








Gaming

223,886



220,395



900,922



888,414


Food and beverage

41,716



42,417



168,096



168,730


Room

9,804



9,576



41,298



41,132


Other

19,570



20,540



80,508



86,166


Selling, general and administrative

79,764



80,035



322,420



327,599


Maintenance and utilities

23,583



25,399



104,548



109,526


Depreciation and amortization

51,867



52,799



207,118



208,915


Corporate expense

24,928



23,021



76,941



75,626


Project development, preopening and writedowns

2,689



5,476



6,907



13,747


Impairments of assets

17,500



40,575



18,565



60,780


Other operating items, net

565



(261)



907



(13)


Total operating costs and expenses

495,872



519,972



1,928,230



1,980,622


Boyd's share of Borgata's operating income

15,551



10,626



73,421



50,255


Operating income

62,353



22,247



344,623



211,888


Other expense (income)








Interest income

(462)



(467)



(1,858)



(1,879)


Interest expense, net of amounts capitalized

53,966



57,168



224,590



230,060


Loss on early extinguishments of debt

8,400



407



40,733



1,536


Other, net

35



(450)



3,676



48


Boyd's share of Borgata's non-operating items, net

7,968



9,309



37,422



37,535


Total other expense, net

69,907



65,967



304,563



267,300


Income (loss) before income taxes

(7,554)



(43,720)



40,060



(55,412)


Income taxes benefit (provision)

685



11,297



7,174



2,371


Net income (loss) attributable to Boyd Gaming Corporation

$

(6,869)



$

(32,423)



$

47,234



$

(53,041)










Basic net income (loss) per common share

$

(0.06)



$

(0.29)



$

0.42



$

(0.48)


Weighted average basic shares outstanding

113,672



110,352



112,789



109,979










Diluted net income (loss) per common share

$

(0.06)



$

(0.29)



$

0.42



$

(0.48)


Weighted average diluted shares outstanding

113,672



110,352



113,676



109,979


 

 

BOYD GAMING CORPORATION
SUPPLEMENTAL PRO FORMA INFORMATION
Reconciliation of Pro Forma Adjusted EBITDA to Pro Forma Operating Income
(Unaudited)



















Three Months Ended


Year Ended


December 31,


December 31,

(In thousands)

2015


2014


2015


2014

Net Revenues by Reportable Segment








Las Vegas Locals

$

158,750



$

151,732



$

610,107



$

592,652


Downtown Las Vegas

62,469



59,611



234,191



224,275


Midwest and South

200,947



200,005



852,288



831,477


Peninsula

120,508



120,245



502,846



493,851


  Net revenues

$

542,674



$

531,593



$

2,199,432



$

2,142,255










Adjusted EBITDA by Reportable Segment








Las Vegas Locals

$

43,999



$

39,757



$

157,312



$

144,397


Downtown Las Vegas

16,186



13,116



49,314



37,309


Midwest and South

43,344



40,087



196,822



169,977


Peninsula

42,963



42,163



184,120



175,081


  Wholly owned property Adjusted EBITDA

146,492



135,123



587,568



526,764


Corporate expense

(15,177)



(16,777)



(60,177)



(59,420)


  Wholly owned Adjusted EBITDA

131,315



118,346



527,391



467,344


Boyd's share of Borgata's Adjusted EBITDA

22,932



18,019



102,095



77,978


  Adjusted EBITDA

154,247



136,365



629,486



545,322










Other operating costs and expenses








Deferred rent

855



904



3,428



3,618


Depreciation and amortization

51,867



52,799



207,118



208,915


Share-based compensation expense

11,037



7,235



19,264



18,666


Project development, preopening and writedowns

2,689



5,476



6,907



13,747


Impairments of assets

17,500



40,575



18,565



60,780


Other operating items, net

565



(261)



907



(13)


Boyd's share of Borgata's operating costs and expenses

7,381



7,390



28,674



27,721


  Total other operating costs and expenses

91,894



114,118



284,863



333,434


Operating income

62,353



22,247



344,623



211,888


Other expense (income)








Interest income

(462)



(467)



(1,858)



(1,879)


Interest expense, net of amounts capitalized

53,966



57,168



224,590



230,060


Loss on early extinguishments of debt

8,400



407



40,733



1,536


Other, net

35



(450)



3,676



48


Boyd's share of Borgata's non-operating items, net

7,968



9,309



37,422



37,535


Total other expense, net

69,907



65,967



304,563



267,300


Income (loss) before income taxes

(7,554)



(43,720)



40,060



(55,412)


Income taxes benefit (provision)

685



11,297



7,174



2,371


Net income (loss) attributable to Boyd Gaming Corporation

$

(6,869)



$

(32,423)



$

47,234



$

(53,041)


 

Non-GAAP Financial Measures

Regulation G, "Conditions for Use of Non-GAAP Financial Measures," prescribes the conditions for use of non-GAAP financial information in public disclosures. We believe that our presentations of the following non-GAAP financial measures are important supplemental measures of operating performance to investors: earnings before interest, taxes, depreciation and amortization (EBITDA), Adjusted EBITDA, Adjusted Earnings and Adjusted Earnings Per Share (Adjusted EPS). The following discussion defines these terms and why we believe they are useful measures of our performance.  We do not provide a reconciliation of forward-looking non-GAAP financial measures to the corresponding forward-looking GAAP measure due to our inability to project special charges and certain expenses.

EBITDA and Adjusted EBITDA

EBITDA is a commonly used measure of performance in our industry that we believe, when considered with measures calculated in accordance with accounting principles generally accepted in the United States ("GAAP"), provides our investors a more complete understanding of our operating results before the impact of investing and financing transactions and income taxes and facilitates comparisons between us and our competitors. Management has historically adjusted EBITDA when evaluating operating performance because we believe that the inclusion or exclusion of certain recurring and non-recurring items is necessary to provide the most accurate measure of our core operating results and as a means to evaluate period-to-period results. We refer to this measure as Adjusted EBITDA. We have chosen to provide this information to investors to enable them to perform more meaningful comparisons of past, present and future operating results and as a means to evaluate the results of core on-going operations. We have historically reported this measure to our investors and believe that the continued inclusion of Adjusted EBITDA provides consistency in our financial reporting. We use Adjusted EBITDA in this press release because we believe it is useful to investors in allowing greater transparency related to a significant measure used by our management in their financial and operational decision-making. Adjusted EBITDA is among the more significant factors in management's internal evaluation of total company and individual property performance and in the evaluation of incentive compensation related to property management. Management also uses Adjusted EBITDA as a measure in the evaluation of potential acquisitions and dispositions. Adjusted EBITDA is also used by management in the annual budget process. Externally, we believe these measures continue to be used by investors in their assessment of our operating performance and the valuation of our company. Adjusted EBITDA reflects EBITDA adjusted for deferred rent,  share-based compensation expense, project development, preopening and write-downs expenses, impairments of assets,  loss on early extinguishments of debt and other operating items, net, and Borgata's preopening expenses and other items and write-downs, net. For periods prior to the September 30, 2014, deconsolidation of Borgata, the calculation of Adjusted EBITDA includes 100% of the adjusting items for Borgata.  For periods after the date of deconsolidation, the calculation includes Boyd's share of the adjusting items.  Pro forma EBITDA and pro forma Adjusted EBITDA reflect Borgata on the equity method for all periods presented.  Both EBITDA and Adjusted EBITDA include corporate expense.

Adjusted Earnings and Adjusted EPS

Adjusted Earnings is net income (loss) before project development, preopening and write-downs expenses, impairments of assets, certain adjustments to property tax accruals, other items, net, gain or loss on early extinguishments of debt, other non-recurring adjustments, net, valuation adjustments related to the consolidation of Borgata, and Borgata's preopening expenses and other items, losses on early extinguishments of debt, write-downs, net, and the income tax provision impact of tax audit settlements. For periods prior to the September 30, 2014, deconsolidation of Borgata, the calculation of Adjusted Earnings includes 100% of the adjusting items for Borgata.  For periods after the date of deconsolidation, the calculation includes Boyd's share of the adjusting items.  Adjusted Earnings and Adjusted EPS are presented solely as supplemental disclosures because management believes that they are widely used measures of performance in the gaming industry.

Limitations on the Use of Non-GAAP Measures

The use of EBITDA, Adjusted EBITDA, Adjusted Earnings, Adjusted EPS and certain other non-GAAP financial measures has certain limitations. Our presentation of EBITDA, Adjusted EBITDA, Adjusted Earnings, Adjusted EPS or certain other non-GAAP financial measures may be different from the presentation used by other companies and therefore comparability may be limited. Depreciation and amortization expense, interest expense, income taxes and other items have been and will be incurred and are not reflected in the presentation of EBITDA or Adjusted EBITDA. Each of these items should also be considered in the overall evaluation of our results. Additionally, EBITDA and Adjusted EBITDA do not consider capital expenditures and other investing activities and should not be considered as a measure of our liquidity. We compensate for these limitations by providing the relevant disclosure of our depreciation and amortization, interest and income taxes, capital expenditures and other items both in our reconciliations to the historical GAAP financial measures and in our consolidated financial statements, all of which should be considered when evaluating our performance.

EBITDA, Adjusted EBITDA, Adjusted Earnings, Adjusted EPS and certain other non-GAAP financial measures are used in addition to and in conjunction with results presented in accordance with GAAP. EBITDA, Adjusted EBITDA, Adjusted Earnings, Adjusted EPS and certain other non-GAAP financial measures should not be considered as an alternative to net income, operating income, or any other operating performance measure prescribed by GAAP, nor should these measures be relied upon to the exclusion of GAAP financial measures. EBITDA, Adjusted EBITDA, Adjusted Earnings, Adjusted EPS and certain other non-GAAP financial measures reflect additional ways of viewing our operations that we believe, when viewed with our GAAP results and the reconciliations to the corresponding historical GAAP financial measures, provide a more complete understanding of factors and trends affecting our business than could be obtained absent this disclosure. Management strongly encourages investors to review our financial information in its entirety and not to rely on a single financial measure.

Forward-looking Statements and Company Information
This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Such statements contain words such as "may," "will," "might," "expect," "believe," "anticipate," "could," "would," "estimate," "continue," "pursue," or the negative thereof or comparable terminology, and may include (without limitation) information regarding the Company's expectations, goals or intentions regarding future performance. In addition, forward-looking statements in this press release include statements regarding: that the Company's Las Vegas Locals business reflects a strengthening economy, that the Company is well-positioned for continued growth and success in 2016, and including all of the statements under the heading "Full-Year 2016 Guidance." Forward-looking statements involve certain risks and uncertainties, and actual results may differ materially from those discussed in any such statement. These risks and uncertainties include, but are not limited to: fluctuations in the Company's operating results; recovery of its properties in various markets; the state of the economy and its effect on consumer spending and the Company's results of operations; the timing for economic recovery, its effect on the Company's business and the local economies where the Company's properties are located; the receipt of legislative, and other state, federal and local approvals for the Company's development projects; whether online gaming will become legalized in various states, the Company's ability to operate online gaming profitably, or otherwise; consumer reaction to fluctuations in the stock market and economic factors; the fact that the Company's expansion, development and renovation projects (including enhancements to improve property performance) are subject to many risks inherent in expansion, development or construction of a new or existing project; the effects of events adversely impacting the economy or the regions from which the Company draws a significant percentage of its customers; competition; litigation; financial community and rating agency perceptions of the Company and its subsidiaries; changes in laws and regulations, including increased taxes; the availability and price of energy, weather, regulation, economic, credit and capital market conditions; and the effects of war, terrorist or similar activity. Additional factors that could cause actual results to differ are discussed under the heading "Risk Factors" and in other sections of the Company's Annual Report on Form 10-K, its Quarterly Reports on Form 10-Q, and in the Company's other current and periodic reports filed from time to time with the SEC. All forward-looking statements in this press release are made as of the date hereof, based on information available to the Company as of the date hereof, and the Company assumes no obligation to update any forward-looking statement. 

About Boyd Gaming
Headquartered in Las Vegas, Boyd Gaming Corporation (NYSE: BYD) is a leading diversified owner and operator of  22 gaming entertainment properties located in Nevada, Illinois, Indiana, Iowa, Kansas, Louisiana, Mississippi and New Jersey.  Boyd Gaming press releases are available at www.prnewswire.com. Additional news and information on Boyd Gaming can be found at www.boydgaming.com.

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SOURCE Boyd Gaming Corporation

For further information: Financial, Josh Hirsberg, (702) 792-7234, joshhirsberg@boydgaming.com, or Media, David Strow, (702) 792-7386, davidstrow@boydgaming.com