Boyd Gaming Reports Second-Quarter 2016 Results
- Company Expanding in High-Growth Las Vegas Market with Aliante, Cannery
- Sale of Borgata Interest Completed, Accelerating Deleveraging Efforts
- Las Vegas Locals Revenue, Adjusted EBITDA Grow for 5th Consecutive Quarter

LAS VEGAS, Aug. 3, 2016 /PRNewswire/ -- Boyd Gaming Corporation (NYSE: BYD) today reported financial results for the second quarter ended June 30, 2016.  

Boyd Gaming logo.

Boyd Gaming reported second-quarter 2016 net revenues of $544.9 million, compared to $559.9 million in the year-ago quarter.  On a GAAP basis, and including discontinued operations, the Company reported net income of $30.0 million, or $0.26 per share, for the second quarter of 2016, compared to a net loss of $6.4 million, or $0.06 per share, for the year-ago period.  Income from continuing operations, net of tax, for the second quarter was $11.3 million, or $0.10 per share, compared to a net loss of $12.4 million, or $0.11 per share, in the prior-year second quarter.  Prior-year results were impacted by pretax losses on the early extinguishments of debt of $31.0 million.  During the second quarter of 2016, the Company announced an agreement to sell its 50% equity interest in the parent company of Borgata Hotel Casino & Spa.  As a result of this agreement, the Company's share of Borgata's net income is reflected as discontinued operations in the accompanying consolidated financial statements. 

Total Adjusted EBITDA(1) was $137.9 million, compared to $140.6 million in the second quarter of 2015. Adjusted Earnings(1) for the second quarter 2016 were $18.1 million, or $0.16 per share, compared to Adjusted Earnings of $20.9 million, or $0.19 per share, for the same period in 2015.  Adjusted EBITDA and Adjusted Earnings exclude discontinued operations.

Keith Smith, President and Chief Executive Officer of Boyd Gaming, said: "The second quarter of 2016 was a significant time for our Company, as we executed several transactions that will strengthen our financial foundation and position us for continued growth.  With the acquisitions of Aliante and the Cannery properties, we will be expanding our presence in the high-growth Las Vegas locals market.  And we unlocked the significant value in our Borgata joint venture, allowing us to further accelerate our deleveraging efforts."

Smith continued, "In terms of our operational performance, results across our business segments were varied.  In Las Vegas, strong performances in our Locals operations in April and June were tempered by a tough year-over-year comparison in May, while our Downtown Las Vegas operations continued to deliver a high level of performance.  In the Midwest and South segment, our performance improved modestly from trends earlier in the year, while the Peninsula segment performed below our expectations, largely due to a weaker than expected gaming market in Kansas. We continue to make significant progress in the execution of our growth strategy, and are optimistic about the future."

(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, second-quarter 2016 net revenues were $154.9 million, an increase of 1.2% from $153.0 million in the year-ago quarter.  Second-quarter 2016 Adjusted EBITDA was $43.2 million, up 2.4% from $42.2 million in the second quarter of 2015.

The segment achieved its fifth consecutive quarter of revenue growth, Adjusted EBITDA growth and margin improvements.  Additionally, the Company's amenity investment initiative continued to drive growth in non-gaming revenue during the quarter.   Solid operating performances in April and June were partially offset by challenging year-over-year comparisons in May. In May 2015, one-time citywide events drove unusually strong visitation to the Las Vegas market. 

Downtown Las Vegas
In the Downtown Las Vegas segment, net revenues were $59.2 million in the second quarter of 2016, up 1.3% from $58.4 million in the year-ago period.  Adjusted EBITDA increased 15.9% to $14.3 million, compared to $12.3 million in the second quarter of 2015.

The Downtown Las Vegas segment delivered its sixth straight quarter of revenue and double-digit Adjusted EBITDA gains, driven by growth in Hawaiian business and further increases in visitation to the downtown area. Results also benefitted from continued operational efficiencies, as operating margins improved by 300 basis points during the quarter.

Midwest and South; Peninsula
In the Midwest and South segment, net revenues were $207.8 million, compared to $217.8 million in the second quarter of 2015, while Adjusted EBITDA was $50.1 million versus $51.8 million in the year-ago period. The Peninsula segment reported net revenues of $122.9 million, compared to $130.6 million in the second quarter of 2015, and Adjusted EBITDA of $44.7 million versus $49.2 million in the year-ago period.

In the Midwest and South, five of the segment's seven properties achieved Adjusted EBITDA above prior-year levels, and overall operating margins improved. Results reflect declines at IP and Par-A-Dice, as both properties continued to contend with new competition in their markets.  Overall, the segment's Adjusted EBITDA performance reflected a slight improvement over first-quarter trends.

Peninsula segment results were largely impacted by revenue and Adjusted EBITDA declines at the Kansas Star, due to general softness in visitation across the state's gaming market.  Additionally, results at Evangeline Downs and Amelia Belle reflect continued economic weakness in south-central Louisiana.

Borgata
Borgata reported second quarter 2016 net revenues of $203.3 million, up from $191.2 million in revenues in the year-ago period. Adjusted EBITDA was $60.8 million, compared to $44.5 million in the year-ago period.

Year-over-year growth was primarily driven by higher slot volumes, normalized table game hold compared to the year-ago quarter, and a $5 million recovery from the Casino Reinvestment Development Authority, related to certain capital improvement projects.

The Company's share of Borgata's net income is reported as discontinued operations, and was $18.7 million for the second quarter of 2016, compared to $6.0 million in the year-ago period. 

Balance Sheet Statistics
As of June 30, 2016, Boyd Gaming had cash on hand of $628.3 million, including $23.6 million related to Peninsula.  Total debt was $3.71 billion, of which $960.5 million was related to Peninsula.

Borgata's cash and debt balances are not included in the Company's balance sheet. Borgata had cash on hand of $31.3 million and total debt of $603.0 million at June 30, 2016. 

Full Year 2016 Guidance
Following Boyd Gaming's divestiture of its 50% equity interest in Borgata, the Company is excluding Borgata's results from its guidance for the full year 2016.

Boyd Gaming projects wholly-owned Adjusted EBITDA of $535 million to $555 million for the full year 2016, which includes anticipated fourth-quarter contributions from Aliante and the Cannery properties.   Excluding these pending acquisitions, the Company projects wholly-owned Adjusted EBITDA of $535 million to $545 million for the full year 2016.

Conference Call Information
Boyd Gaming will host its conference call to discuss second-quarter 2016 results and provide an update on its pending acquisitions today, August 3, at 5:00 p.m. Eastern.  The conference call number is (888) 317-6003, passcode 5148733.  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/964/16471

Following the call's completion, a replay will be available by dialing (877) 344-7529 today, August 3, beginning at 7:00 p.m. Eastern and continuing through Wednesday, August 10, at 11:59 p.m. Eastern.  The passcode for the replay will be 10090638.  The replay will also be available on the Internet at www.boydgaming.com.

 

BOYD GAMING CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited)

                               
 

Three Months Ended

 

Six Months Ended

 

June 30,

 

June 30,

(In thousands, except per share data)

2016

 

2015

 

2016

 

2015

Revenues

             

Gaming

$

452,928

   

$

468,580

   

$

915,479

   

$

933,337

 

Food and beverage

75,898

   

77,909

   

152,698

   

154,205

 

Room

43,365

   

42,332

   

85,240

   

81,685

 

Other

29,693

   

30,642

   

61,159

   

60,327

 

Gross revenues

601,884

   

619,463

   

1,214,576

   

1,229,554

 

Less promotional allowances

57,010

   

59,596

   

117,324

   

119,109

 

Net revenues

544,874

   

559,867

   

1,097,252

   

1,110,445

 

Operating costs and expenses

             

Gaming

217,768

   

224,686

   

441,293

   

451,383

 

Food and beverage

42,116

   

42,913

   

83,919

   

84,480

 

Room

11,293

   

10,682

   

21,792

   

20,729

 

Other

18,827

   

19,744

   

38,159

   

39,390

 

Selling, general and administrative

79,002

   

81,013

   

160,853

   

162,702

 

Maintenance and utilities

25,009

   

26,616

   

48,857

   

51,935

 

Depreciation and amortization

48,250

   

51,964

   

95,903

   

103,906

 

Corporate expense

16,099

   

17,352

   

34,006

   

37,004

 

Project development, preopening and writedowns

5,897

   

1,749

   

7,738

   

2,704

 

Impairments of assets

   

   

1,440

   

1,065

 

Other operating items, net

123

   

54

   

552

   

170

 

Total operating costs and expenses

464,384

   

476,773

   

934,512

   

955,468

 

Operating income

80,490

   

83,094

   

162,740

   

154,977

 

Other expense (income)

             

Interest income

(959)

   

(465)

   

(1,456)

   

(936)

 

Interest expense, net of amounts capitalized

61,887

   

57,131

   

114,952

   

114,066

 

Loss on early extinguishments of debt

419

   

30,962

   

846

   

31,470

 

Other, net

65

   

1,270

   

142

   

1,888

 

Total other expense, net

61,412

   

88,898

   

114,484

   

146,488

 

Income (loss) from continuing operations before income taxes

19,078

   

(5,804)

   

48,256

   

8,489

 

Income taxes benefit (provision)

(7,771)

   

(6,586)

   

(15,389)

   

9,625

 

Income (loss) from continuing operations, net of tax

11,307

   

(12,390)

   

32,867

   

18,114

 

Income from discontinued operations, net of tax

18,715

   

5,965

   

30,345

   

10,564

 

Net income (loss)

$

30,022

   

$

(6,425)

   

$

63,212

   

$

28,678

 
               

Basic net income (loss) per common share

             

Continuing operations

$

0.10

   

$

(0.11)

   

$

0.29

   

$

0.17

 

Discontinued operations

0.16

   

0.05

   

0.27

   

0.09

 

  Basic net income (loss) per common share

$

0.26

   

$

(0.06)

   

$

0.56

   

$

0.26

 

Weighted average basic shares outstanding

114,328

   

112,232

   

114,218

   

111,841

 
               

Diluted net income (loss) per common share

             

Continuing operations

$

0.10

   

$

(0.11)

   

$

0.29

   

$

0.16

 

Discontinued operations

0.16

   

0.05

   

0.26

   

0.09

 

  Diluted net income (loss) per common share

$

0.26

   

$

(0.06)

   

$

0.55

   

$

0.25

 

Weighted average diluted shares outstanding

115,077

   

112,232

   

114,974

   

112,694

 

 

BOYD GAMING CORPORATION

SUPPLEMENTAL INFORMATION

Reconciliation of Adjusted EBITDA to Net Income (Loss)

(Unaudited)

                               
 

Three Months Ended

 

Six Months Ended

 

June 30,

 

June 30,

(In thousands)

2016

 

2015

 

2016

 

2015

Net Revenues by Reportable Segment

             

Las Vegas Locals

$

154,936

   

$

153,032

   

$

313,334

   

$

303,332

 

Downtown Las Vegas

59,212

   

58,434

   

117,817

   

115,038

 

Midwest and South

207,837

   

217,777

   

417,022

   

435,542

 

Peninsula

122,889

   

130,624

   

249,079

   

256,533

 

  Net revenues

$

544,874

   

$

559,867

   

$

1,097,252

   

$

1,110,445

 
               

Adjusted EBITDA by Reportable Segment

             

Las Vegas Locals

$

43,173

   

$

42,175

   

$

87,444

   

$

81,052

 

Downtown Las Vegas

14,263

   

12,307

   

26,944

   

22,984

 

Midwest and South

50,056

   

51,777

   

98,869

   

102,761

 

Peninsula

44,691

   

49,164

   

91,803

   

95,527

 

  Property Adjusted EBITDA

152,183

   

155,423

   

305,060

   

302,324

 

Corporate expense (a)

(14,286)

   

(14,777)

   

(29,471)

   

(31,419)

 

  Adjusted EBITDA

137,897

   

140,646

   

275,589

   

270,905

 
               

Other operating costs and expenses

             

Deferred rent

817

   

859

   

1,633

   

1,716

 

Depreciation and amortization

48,250

   

51,964

   

95,903

   

103,906

 

Share-based compensation expense

2,320

   

2,926

   

5,583

   

6,367

 

Project development, preopening and writedowns

5,897

   

1,749

   

7,738

   

2,704

 

Impairments of assets

   

   

1,440

   

1,065

 

Other operating items, net

123

   

54

   

552

   

170

 

Total other operating costs and expenses

57,407

   

57,552

   

112,849

   

115,928

 

Operating income

80,490

   

83,094

   

162,740

   

154,977

 

Other expense (income)

             

Interest income

(959)

   

(465)

   

(1,456)

   

(936)

 

Interest expense, net of amounts capitalized

61,887

   

57,131

   

114,952

   

114,066

 

Loss on early extinguishments of debt

419

   

30,962

   

846

   

31,470

 

Other, net

65

   

1,270

   

142

   

1,888

 

Total other expense, net

61,412

   

88,898

   

114,484

   

146,488

 

Income (loss) before income taxes

19,078

   

(5,804)

   

48,256

   

8,489

 

Income taxes benefit (provision)

(7,771)

   

(6,586)

   

(15,389)

   

9,625

 

Income (loss) from continuing operations, net of tax

11,307

   

(12,390)

   

32,867

   

18,114

 

Income from discontinued operations, net of tax

18,715

   

5,965

   

30,345

   

10,564

 

Net income (loss)

$

30,022

   

$

(6,425)

   

$

63,212

   

$

28,678

 

 

BOYD GAMING CORPORATION

SUPPLEMENTAL INFORMATION

Reconciliation of Adjusted EBITDA to Net Income (Loss)

(Unaudited)

(Continued)

 

(a) Reconciliation of corporate expense:

                               
 

Three Months Ended

 

Six Months Ended

 

June 30,

 

June 30,

(In thousands)

2016

 

2015

 

2016

 

2015

Corporate expense as reported on Consolidated Statements of
   Operations

$

16,099

   

$

17,352

   

$

34,006

   

$

37,004

 

Corporate share-based compensation expense

(1,813)

   

(2,575)

   

(4,535)

   

(5,585)

 

Corporate expense as reported on the above table

$

14,286

   

$

14,777

   

$

29,471

   

$

31,419

 

 

BOYD GAMING CORPORATION

SUPPLEMENTAL INFORMATION

Reconciliation of Net Income (Loss) to Adjusted Earnings (Loss) and Net Income (Loss) Per Share to

Adjusted Earnings Per Share

(Unaudited)

                               
 

Three Months Ended

 

Six Months Ended

 

June 30,

 

June 30,

(In thousands, except per share data)

2016

 

2015

 

2016

 

2015

Net income (loss)

$

30,022

   

$

(6,425)

   

$

63,212

   

$

28,678

 

Less: income from discontinued operations, net of tax

(18,715)

   

(5,965)

   

(30,345)

   

(10,564)

 

Adjusted net income (loss)

11,307

   

(12,390)

   

32,867

   

18,114

 

Pretax adjustments:

             

  Project development, preopening and writedowns

5,897

   

1,749

   

7,738

   

2,704

 

  Impairments of assets

   

   

1,440

   

1,065

 

  Other operating items, net

123

   

54

   

552

   

170

 

  Loss on early extinguishments of debt

419

   

30,962

   

846

   

31,470

 

  Other, net

65

   

1,270

   

142

   

1,888

 

 Total adjustments

6,504

   

34,035

   

10,718

   

37,297

 
               

Income tax effect for above adjustments

294

   

(785)

   

30

   

(1,789)

 

Impact of tax audit settlements on provision

   

   

   

(22,606)

 

Adjusted earnings

$

18,105

   

$

20,860

   

$

43,615

   

$

31,016

 
               

Net income (loss) per share

$

0.26

   

$

(0.06)

   

$

0.55

   

$

0.25

 

Less: income from discontinued operations per share

(0.16)

   

(0.05)

   

(0.26)

   

(0.09)

 

Adjusted net income (loss) per share

0.10

   

(0.11)

   

0.29

   

0.16

 

Pretax adjustments:

             

  Project development, preopening and writedowns

0.05

   

0.02

   

0.07

   

0.02

 

  Impairments of assets

   

   

0.01

   

0.01

 

  Other operating items, net

   

   

   

 

  Loss on early extinguishments of debt

   

0.28

   

   

0.29

 

  Other, net

0.01

   

0.01

   

   

0.02

 

 Total adjustments

0.06

   

0.31

   

0.09

   

0.34

 
               

Income tax effect for above adjustments

   

(0.01)

   

   

(0.02)

 

Impact of tax audit settlements on provision

   

   

   

(0.20)

 

Adjusted earnings per share

$

0.16

   

$

0.19

   

$

0.38

   

$

0.28

 
               

Weighted average shares outstanding

115,077

   

113,021

   

114,974

   

112,694

 

 

BOYD GAMING CORPORATION

SUPPLEMENTAL INFORMATION

Condensed Consolidating Statements of Operations

Three Months Ended June 30, 2016

(Unaudited)

               
 

Boyd Gaming

(In thousands, except per share data)

Excluding
Peninsula
Segment

 

Peninsula
Segment

 

Eliminations

 

 

Consolidated

Revenues

             

Gaming

$

338,772

   

$

114,156

   

$

   

$

452,928

 

Food and beverage

66,981

   

8,917

   

   

75,898

 

Room

43,365

   

   

   

43,365

 

Other

29,960

   

4,425

   

(4,692)

   

29,693

 

Gross revenues

479,078

   

127,498

   

(4,692)

   

601,884

 

Less promotional allowances

52,400

   

4,610

   

   

57,010

 

  Net revenues

426,678

   

122,888

   

(4,692)

   

544,874

 

Operating costs and expenses

             

Gaming

164,063

   

53,705

   

   

217,768

 

Food and beverage

35,943

   

6,173

   

   

42,116

 

Room

11,293

   

   

   

11,293

 

Other

16,197

   

7,322

   

(4,692)

   

18,827

 

Selling, general and administrative

66,510

   

12,492

   

   

79,002

 

Maintenance and utilities

21,813

   

3,196

   

   

25,009

 

Depreciation and amortization

34,570

   

13,680

   

   

48,250

 

Corporate expense

15,709

   

390

   

   

16,099

 

Project development, preopening and writedowns

5,744

   

153

   

   

5,897

 

Impairments of assets

   

   

   

 

Other operating items, net

71

   

52

   

   

123

 

  Total operating costs and expenses

371,913

   

97,163

   

(4,692)

   

464,384

 

Operating income

54,765

   

25,725

   

   

80,490

 

Other expense (income)

             

Interest income

(500)

   

(459)

   

   

(959)

 

Interest expense, net of amounts capitalized

44,392

   

17,495

   

   

61,887

 

Loss on early extinguishments of debt

   

419

   

   

419

 

Other, net

(18)

   

83

   

   

65

 

     Total other expense, net

43,874

   

17,538

   

   

61,412

 

Income before income taxes

10,891

   

8,187

   

   

19,078

 

Income taxes provision

(2,166)

   

(5,605)

   

   

(7,771)

 

Income (loss) from continuing operations, net of tax

8,725

   

2,582

   

   

11,307

 

Income from discontinued operations, net of tax

18,715

   

   

   

18,715

 

Net income

$

27,440

   

$

2,582

   

$

   

$

30,022

 
               

Basic net income per common share

             

Continuing operations

           

$

0.10

 

Discontinued operations

           

0.16

 

  Basic net income per common share

           

$

0.26

 

Weighted average basic shares outstanding

           

114,328

 
               

Diluted net income per common share

             

Continuing operations

           

$

0.10

 

Discontinued operations

           

0.16

 

  Diluted net income per common share

           

$

0.26

 

Weighted average diluted shares outstanding

           

115,077

 

 

BOYD GAMING CORPORATION

SUPPLEMENTAL INFORMATION

Condensed Consolidating Statements of Operations

Three Months Ended June 30, 2015

(Unaudited)

               
 

Boyd Gaming

(In thousands, except per share data)

Excluding
Peninsula
Segment

 

Peninsula
Segment

 

Eliminations

 

 

Consolidated

Revenues

             

Gaming

$

347,647

   

$

120,933

   

$

   

$

468,580

 

Food and beverage

68,195

   

9,714

   

   

77,909

 

Room

42,332

   

   

   

42,332

 

Other

30,755

   

4,940

   

(5,053)

   

30,642

 

Gross revenues

488,929

   

135,587

   

(5,053)

   

619,463

 

Less promotional allowances

54,631

   

4,965

   

   

59,596

 

  Net revenues

434,298

   

130,622

   

(5,053)

   

559,867

 

Operating costs and expenses

             

Gaming

168,830

   

55,856

   

   

224,686

 

Food and beverage

36,556

   

6,357

   

   

42,913

 

Room

10,682

   

   

   

10,682

 

Other

16,759

   

8,038

   

(5,053)

   

19,744

 

Selling, general and administrative

68,023

   

12,990

   

   

81,013

 

Maintenance and utilities

23,345

   

3,271

   

   

26,616

 

Depreciation and amortization

34,863

   

17,101

   

   

51,964

 

Corporate expense

17,005

   

347

   

   

17,352

 

Project development, preopening and writedowns

1,226

   

523

   

   

1,749

 

Impairments of assets

   

   

   

 

Other operating items, net

(1)

   

55

   

   

54

 

  Total operating costs and expenses

377,288

   

104,538

   

(5,053)

   

476,773

 

Operating income

57,010

   

26,084

   

   

83,094

 

Other expense (income)

             

Interest income

   

(465)

   

   

(465)

 

Interest expense, net of amounts capitalized

38,706

   

18,425

       

57,131

 

Loss on early extinguishments of debt

30,008

   

954

   

   

30,962

 

Other, net

1,245

   

25

   

   

1,270

 

     Total other expense, net

69,959

   

18,939

   

   

88,898

 

Income before income taxes

(12,949)

   

7,145

   

   

(5,804)

 

Income taxes provision

(2,088)

   

(4,498)

   

   

(6,586)

 

Income (loss) from continuing operations, net of tax

(15,037)

   

2,647

   

   

(12,390)

 

Income from discontinued operations, net of tax

5,965

   

   

   

5,965

 

Net income (loss)

$

(9,072)

   

$

2,647

   

$

   

$

(6,425)

 
               

Basic net income (loss) per common share

             

Continuing operations

           

$

(0.11)

 

Discontinued operations

           

0.05

 

  Basic net loss per common share

           

$

(0.06)

 

Weighted average basic shares outstanding

           

112,232

 
               

Diluted net income (loss) per common share

             

Continuing operations

           

$

(0.11)

 

Discontinued operations

           

0.05

 

  Diluted net per common share

           

$

(0.06)

 

Weighted average diluted shares outstanding

           

112,232

 

 

BOYD GAMING CORPORATION

SUPPLEMENTAL INFORMATION

Condensed Consolidating Statements of Operations

Six Months Ended June 30, 2016

(Unaudited)

               
 

Boyd Gaming

(In thousands, except per share data)

Excluding
Peninsula
Segment

 

Peninsula
Segment

 

Eliminations

 

Consolidated

Revenues

             

Gaming

$

684,078

   

$

231,401

   

$

   

$

915,479

 

Food and beverage

134,256

   

18,442

   

   

152,698

 

Room

85,240

   

   

   

85,240

 

Other

61,940

   

8,789

   

(9,570)

   

61,159

 

Gross revenues

965,514

   

258,632

   

(9,570)

   

1,214,576

 

Less promotional allowances

107,771

   

9,553

   

   

117,324

 

  Net revenues

857,743

   

249,079

   

(9,570)

   

1,097,252

 

Operating costs and expenses

             

Gaming

333,785

   

107,508

   

   

441,293

 

Food and beverage

71,376

   

12,543

   

   

83,919

 

Room

21,792

   

   

   

21,792

 

Other

33,259

   

14,470

   

(9,570)

   

38,159

 

Selling, general and administrative

134,814

   

26,039

   

   

160,853

 

Maintenance and utilities

42,571

   

6,286

   

   

48,857

 

Depreciation and amortization

68,640

   

27,263

   

   

95,903

 

Corporate expense

33,207

   

799

   

   

34,006

 

Project development, preopening and writedowns

7,434

   

304

   

   

7,738

 

Impairments of assets

1,440

   

   

   

1,440

 

Other operating items, net

500

   

52

   

   

552

 

  Total operating costs and expenses

748,818

   

195,264

   

(9,570)

   

934,512

 

Operating income

108,925

   

53,815

   

   

162,740

 

Other expense (income)

             

Interest income

(535)

   

(921)

   

   

(1,456)

 

Interest expense, net of amounts capitalized

79,647

   

35,305

   

   

114,952

 

Loss on early extinguishments of debt

   

846

   

   

846

 

Other, net

(33)

   

175

   

   

142

 

     Total other expense, net

79,079

   

35,405

   

   

114,484

 

Income before income taxes

29,846

   

18,410

   

   

48,256

 

Income taxes provision

(4,180)

   

(11,209)

   

   

(15,389)

 

Income from continuing operations, net of tax

25,666

   

7,201

   

   

32,867

 

Income from discontinued operations, net of tax

30,345

   

   

   

30,345

 

Net income

$

56,011

   

$

7,201

   

$

   

$

63,212

 
               

Basic net income per common share

             

Continuing operations

           

$

0.29

 

Discontinued operations

           

0.27

 

  Basic net income per common share

           

$

0.56

 

 Weighted average basic shares outstanding

           

114,218

 
               

Diluted net income per common share

               

Continuing operations

           

$

0.29

 

Discontinued operations

           

0.26

 

  Diluted net income per common share

           

$

0.55

 

 Weighted average diluted shares outstanding

           

114,974

 

 

BOYD GAMING CORPORATION

SUPPLEMENTAL INFORMATION

Condensed Consolidating Statements of Operations

Six Months Ended June 30, 2015

(Unaudited)

               
 

Boyd Gaming

(In thousands, except per share data)

Excluding
Peninsula
Segment

 

Peninsula
Segment

 

Eliminations

 

 

Consolidated

Revenues

             

Gaming

$

695,361

   

$

237,976

   

$

   

$

933,337

 

Food and beverage

134,512

   

19,693

   

   

154,205

 

Room

81,685

   

   

   

81,685

 

Other

61,363

   

8,845

   

(9,881)

   

60,327

 

Gross revenues

972,921

   

266,514

   

(9,881)

   

1,229,554

 

Less promotional allowances

109,126

   

9,983

   

   

119,109

 

  Net revenues

863,795

   

256,531

   

(9,881)

   

1,110,445

 

Operating costs and expenses

             

Gaming

341,246

   

110,137

   

   

451,383

 

Food and beverage

71,754

   

12,726

   

   

84,480

 

Room

20,729

   

   

   

20,729

 

Other

34,023

   

15,248

   

(9,881)

   

39,390

 

Selling, general and administrative

136,456

   

26,246

   

   

162,702

 

Maintenance and utilities

45,406

   

6,529

   

   

51,935

 

Depreciation and amortization

69,817

   

34,089

   

   

103,906

 

Corporate expense

36,252

   

752

   

   

37,004

 

Project development, preopening and writedowns

2,051

   

653

   

   

2,704

 

Impairments of assets

1,065

   

   

   

1,065

 

Other operating items, net

70

   

100

   

   

170

 

  Total operating costs and expenses

758,869

   

206,480

   

(9,881)

   

955,468

 

Operating income

104,926

   

50,051

   

   

154,977

 

Other expense (income)

             

Interest income

(4)

   

(932)

   

   

(936)

 

Interest expense, net of amounts capitalized

76,971

   

37,095

       

114,066

 

Loss on early extinguishments of debt

30,008

   

1,462

   

   

31,470

 

Other, net

1,702

   

186

   

   

1,888

 

     Total other expense, net

108,677

   

37,811

   

   

146,488

 

Income before income taxes

(3,751)

   

12,240

   

   

8,489

 

Income taxes benefit (provision)

18,622

   

(8,997)

   

   

9,625

 

Income from continuing operations, net of tax

14,871

   

3,243

   

   

18,114

 

Income from discontinued operations, net of tax

10,564

   

   

   

10,564

 

Net income

$

25,435

   

$

3,243

   

$

   

$

28,678

 
               

Basic net income per common share

             

Continuing operations

           

$

0.17

 

Discontinued operations

           

0.09

 

  Basic net income per common share

           

$

0.26

 

Weighted average basic shares outstanding

           

111,841

 
               

Diluted net income per common share

             

Continuing operations

           

$

0.16

 

Discontinued operations

           

0.09

 

  Diluted net income per common share

           

$

0.25

 

Weighted average diluted shares outstanding

           

112,694

 

 

MARINA DISTRICT DEVELOPMENT COMPANY, LLC

dba BORGATA HOTEL CASINO AND SPA

CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited)

                               
 

Three Months Ended

 

Six Months Ended

 

June 30,

 

June 30,

(In thousands)

2016

 

2015

 

2016

 

2015

Revenues

             

Gaming

$

180,987

   

$

170,277

   

$

355,000

   

$

335,405

 

Food and beverage

38,002

   

36,392

   

71,760

   

70,860

 

Room

31,050

   

30,349

   

59,678

   

57,953

 

Other

10,138

   

10,397

   

19,265

   

18,907

 

Gross revenues

260,177

   

247,415

   

505,703

   

483,125

 

Less promotional allowances

56,830

   

56,252

   

112,063

   

109,373

 

Net revenues

203,347

   

191,163

   

393,640

   

373,752

 

Operating costs and expenses

             

Gaming

67,233

   

67,057

   

135,026

   

133,976

 

Food and beverage

19,135

   

19,147

   

35,919

   

36,834

 

Room

3,671

   

3,799

   

6,940

   

7,059

 

Other

8,768

   

9,590

   

16,091

   

16,344

 

Selling, general and administrative

28,804

   

32,523

   

64,226

   

66,676

 

Maintenance and utilities

14,973

   

14,520

   

29,340

   

30,511

 

Depreciation and amortization

14,638

   

14,791

   

28,987

   

29,590

 

Preopening expenses

242

   

   

313

   

 

Other operating items, net

(7,269)

   

(441)

   

(14,027)

   

(765)

 

Total operating costs and expenses

150,195

   

160,986

   

302,815

   

320,225

 

Operating income

53,152

   

30,177

   

90,825

   

53,527

 

Other expense

             

Interest expense, net of amounts capitalized

11,125

   

16,307

   

22,880

   

32,964

 

Loss on early extinguishments of debt

903

   

543

   

1,228

   

1,035

 

Total other expense

12,028

   

16,850

   

24,108

   

33,999

 

Income before state income taxes

41,124

   

13,327

   

66,717

   

19,528

 

State income tax benefit (expense)

(3,736)

   

(1,374)

   

(6,068)

   

453

 

Net income

$

37,388

   

$

11,953

   

$

60,649

   

$

19,981

 
               
               

Reconciliation of Adjusted EBITDA to Operating Income

       
 

Three Months Ended

 

Six Months Ended

 

June 30,

 

June 30,

(In thousands)

2016

 

2015

 

2016

 

2015

Adjusted EBITDA

$

60,763

   

$

44,527

   

$

106,098

   

$

82,352

 

Less:

             

Depreciation and amortization

14,638

   

14,791

   

28,987

   

29,590

 

Preopening expenses

242

   

   

313

   

 

Other operating items, net

(7,269)

   

(441)

   

(14,027)

   

(765)

 

Operating income

$

53,152

   

$

30,177

   

$

90,825

   

$

53,527

 

 

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 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-down expenses, impairments of assets, loss on early extinguishments of debt and other operating items, net.

Adjusted Earnings and Adjusted EPS

Adjusted Earnings is net income (loss) before project development, preopening and write-down 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, the impact on Boyd's income tax provision of tax audit settlements, and income from discontinued operations, net of tax. 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: the Company's pending acquisitions, continued growth, strengthening the Company's financial foundation, long-term growth trends throughout southern Nevada, optimism for long-term prospects for the business, the high-growth locals market, progress on the Company's strategic growth plan, and 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: failure of the Company's pending acquisitions to close, or to close when anticipated; 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, 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 21 gaming entertainment properties located in Nevada, Illinois, Indiana, Iowa, Kansas, Louisiana and Mississippi.  Boyd Gaming press releases are available at www.prnewswire.com.  Additional news and information on Boyd Gaming can be found at www.boydgaming.com.

Logo - http://photos.prnewswire.com/prnh/20030219/BOYDLOGO

 

SOURCE Boyd Gaming Corporation

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