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8-K - FORM 8-K - MOHEGAN TRIBAL GAMING AUTHORITY | d388317d8k.htm |
Exhibit 99.1
MOHEGAN TRIBAL GAMING AUTHORITY ANNOUNCES
THIRD QUARTER FISCAL 2012 OPERATING RESULTS
Uncasville, Connecticut, July 31, 2012 The Mohegan Tribal Gaming Authority, or the Authority, the owner and operator of Mohegan Sun in Uncasville, Connecticut, and Mohegan Sun at Pocono Downs in Wilkes-Barre, Pennsylvania, announced today the operating results for its third quarter ended June 30, 2012.
Our third quarter operating results were lackluster, said Mitchell Grossinger Etess, Chief Executive Officer of the Authority. We faced difficult year-over-year comparisons, persisting economic concerns and significant new supply in the marketplace. However, Mohegan Sun at Pocono Downs continued to perform well, and we recently broke ground on our new hotel and convention center, which will further add to the propertys profitability in the future. In addition, we continue to manage expenses and develop marketing strategies in response to current market conditions.
Consolidated operating results for the third quarter ended June 30, 2012 (unaudited):
| Net revenues of $344.4 million, a 4.7% decrease from the third quarter of fiscal 2011 |
| Gaming revenues of $307.1 million, a 6.5% decrease from the third quarter of fiscal 2011 |
| Gross slot revenues of $224.9 million, a 3.4% decrease from the third quarter of fiscal 2011 |
| Table game revenues of $78.4 million, a 13.8% decrease from the third quarter of fiscal 2011 |
| Non-gaming revenues of $62.8 million, a 3.5% increase over the third quarter of fiscal 2011 |
| Adjusted EBITDA, a non-GAAP measure described below, of $72.9 million, a 12.4% decrease from the third quarter of fiscal 2011 |
| Income from operations of $50.8 million, a 15.4% decrease from the third quarter of fiscal 2011 |
| Net income attributable to the Authority of $9.4 million, a 67.9% decrease from the third quarter of fiscal 2011 |
The declines in income from operations and Adjusted EBITDA were primarily attributable to lower gaming revenues at Mohegan Sun resulting from lower table game hold and decreased slot revenues. These results, combined with a sluggish overall economic environment, offset increased Adjusted EBITDA at Mohegan Sun at Pocono Downs and overall changes in our operations designed to improve profitability. The decline in net income attributable to the Authority primarily resulted from higher interest expense, driven by our March 6, 2012 refinancing transactions, as well as the reduction in income from operations.
Mohegan Sun
Operating results (in thousands, unaudited):
For the Three Months Ended | ||||||||||||||||
June 30, 2012 |
June 30, 2011 |
Variance | Percentage Variance |
|||||||||||||
Income from operations |
$ | 44,801 | $ | 56,316 | $ | (11,515 | ) | (20.4 | %) | |||||||
Adjusted EBITDA |
$ | 62,525 | $ | 73,682 | $ | (11,157 | ) | (15.1 | %) | |||||||
Operating costs and expenses |
$ | 220,075 | $ | 227,973 | $ | (7,898 | ) | (3.5 | %) | |||||||
Net revenues |
$ | 264,876 | $ | 284,289 | $ | (19,413 | ) | (6.8 | %) | |||||||
Gaming revenues |
$ | 232,346 | $ | 255,916 | $ | (23,570 | ) | (9.2 | %) | |||||||
Non-gaming revenues |
$ | 53,935 | $ | 51,945 | $ | 1,990 | 3.8 | % |
The declines in income from operations and Adjusted EBITDA were primarily attributable to lower gaming revenues. Adjusted EBITDA margin decreased to 23.6% for the quarter ended June 30, 2012 from 25.9% in the third quarter of fiscal 2011. Both gaming revenues and Adjusted EBITDA margin in the third quarter of fiscal 2011 benefited from higher table game hold.
Gaming revenues declined due to lower table game and slot revenues. The decrease in table game revenues primarily resulted from lower table game hold. Table game hold at Mohegan Sun decreased to 14.7% for the quarter ended June 30, 2012 from 16.7% in the third quarter of fiscal 2011. The decline in slot revenues resulted from lower slot handle reflecting additional gaming capacity in the Northeast gaming market, changes in our operations designed to improve profitability, including changes in the slot mix on our gaming floor, and a shift in hotel occupancy from casino patrons to transient guests. The decline in gaming revenues also reflects the sluggish overall economic environment.
Non-gaming revenues increased primarily as a result of higher hotel revenues. The growth in hotel revenues reflects a shift in hotel occupancy to higher paying transient guests which had the effect of increasing the average daily room rate.
Selected gaming data (in thousands, except where noted, unaudited):
For the Three Months Ended | ||||||||||||||||
June 30, 2012 |
June 30, 2011 (1) |
Variance | Percentage Variance |
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Slots: |
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Handle |
$ | 2,010,037 | $ | 2,226,569 | $ | (216,532 | ) | (9.7 | %) | |||||||
Gross revenues |
$ | 165,224 | $ | 179,576 | $ | (14,352 | ) | (8.0 | %) | |||||||
Net revenues |
$ | 158,761 | $ | 172,743 | $ | (13,982 | ) | (8.1 | %) | |||||||
Free promotional slot plays (2) |
$ | 18,236 | $ | 17,412 | $ | 824 | 4.7 | % | ||||||||
Weighted average number of machines (in units) |
5,953 | 6,358 | (405 | ) | (6.4 | %) | ||||||||||
Hold percentage (gross) |
8.2 | % | 8.1 | % | 0.1 | % | 1.2 | % | ||||||||
Win per unit per day (gross) (in dollars) |
$ | 305 | $ | 310 | $ | (5 | ) | (1.6 | %) | |||||||
Table games: |
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Drop |
$ | 469,276 | $ | 491,104 | $ | (21,828 | ) | (4.4 | %) | |||||||
Revenues |
$ | 69,150 | $ | 81,749 | $ | (12,599 | ) | (15.4 | %) | |||||||
Weighted average number of games (in units) |
314 | 324 | (10 | ) | (3.1 | %) | ||||||||||
Hold percentage (3) |
14.7 | % | 16.7 | % | (2.0 | %) | (12.0 | %) | ||||||||
Win per unit per day (in dollars) |
$ | 2,421 | $ | 2,775 | $ | (354 | ) | (12.8 | %) | |||||||
Poker: |
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Revenues |
$ | 2,627 | $ | 2,891 | $ | (264 | ) | (9.1 | %) | |||||||
Weighted average number of tables (in units) |
42 | 42 | | | ||||||||||||
Revenue per unit per day (in dollars) |
$ | 687 | $ | 756 | $ | (69 | ) | (9.1 | %) |
(1) | Excludes adjustment to slot revenues of $3.7 million related to prior periods. |
(2) | Free promotional slot plays are included in slot handle, but not reflected in slot revenues. |
(3) | Table game hold percentage is relatively predictable over longer periods of time, but can significantly fluctuate over shorter periods. |
Non-gaming data (in thousands, except where noted, unaudited):
For the Three Months Ended | ||||||||||||||||
June 30, 2012 |
June 30, 2011 |
Variance | Percentage Variance |
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Food and beverage: |
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Revenues |
$ | 16,163 | $ | 15,897 | $ | 266 | 1.7 | % | ||||||||
Meals served |
804 | 802 | 2 | 0.2 | % | |||||||||||
Average price per meal served (in dollars) |
$ | 16.17 | $ | 15.71 | $ | 0.46 | 2.9 | % | ||||||||
Hotel: |
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Revenues |
$ | 10,152 | $ | 9,134 | $ | 1,018 | 11.1 | % | ||||||||
Rooms occupied |
103 | 105 | (2 | ) | (1.9 | %) | ||||||||||
Occupancy rate |
96.3 | % | 97.5 | % | (1.2 | %) | (1.2 | %) | ||||||||
Average daily room rate (in dollars) |
$ | 93 | $ | 84 | $ | 9 | 10.7 | % | ||||||||
Revenue per available room (in dollars) |
$ | 89 | $ | 82 | $ | 7 | 8.5 | % | ||||||||
Retail, entertainment and other: |
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Revenues |
$ | 27,620 | $ | 26,914 | $ | 706 | 2.6 | % | ||||||||
Arena events (in events) |
38 | 30 | 8 | 26.7 | % | |||||||||||
Arena tickets |
229 | 182 | 47 | 25.8 | % | |||||||||||
Average price per Arena ticket (in dollars) |
$ | 42.23 | $ | 57.18 | $ | (14.95 | ) | (26.1 | %) |
Mohegan Sun at Pocono Downs
Operating results (in thousands, unaudited):
For the Three Months Ended | ||||||||||||||||
June 30, 2012 |
June 30, 2011 |
Variance | Percentage Variance |
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Income from operations |
$ | 10,716 | $ | 7,677 | $ | 3,039 | 39.6 | % | ||||||||
Adjusted EBITDA |
$ | 14,686 | $ | 12,881 | $ | 1,805 | 14.0 | % | ||||||||
Operating costs and expenses |
$ | 68,844 | $ | 69,413 | $ | (569 | ) | (0.8 | %) | |||||||
Net revenues |
$ | 79,560 | $ | 77,090 | $ | 2,470 | 3.2 | % | ||||||||
Gaming revenues |
$ | 74,747 | $ | 72,401 | $ | 2,346 | 3.2 | % | ||||||||
Non-gaming revenues |
$ | 8,863 | $ | 8,758 | $ | 105 | 1.2 | % |
The growth in income from operations and Adjusted EBITDA was primarily attributable to higher gaming revenues. The increase in income from operations also reflects lower depreciation expense. Adjusted EBITDA margin increased to 18.5% for the quarter ended June 30, 2012 from 16.7% in the third quarter of fiscal 2011.
Gaming revenues increased primarily as a result of higher slot revenues. The increase in slot revenues resulted from changes in our promotional programs designed to improve profitability.
Selected gaming data (in thousands, except where noted, unaudited):
For the Three Months Ended | ||||||||||||||||
June 30, 2012 |
June 30, 2011 |
Variance | Percentage Variance |
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Slots: |
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Handle |
$ | 743,645 | $ | 753,434 | $ | (9,789 | ) | (1.3 | %) | |||||||
Gross revenues |
$ | 59,696 | $ | 57,047 | $ | 2,649 | 4.6 | % | ||||||||
Net revenues |
$ | 59,667 | $ | 57,034 | $ | 2,633 | 4.6 | % | ||||||||
Free promotional slot plays (1) |
$ | 15,324 | $ | 18,386 | $ | (3,062 | ) | (16.7 | %) | |||||||
Weighted average number of machines (in units) |
2,332 | 2,332 | | | ||||||||||||
Hold percentage (gross) |
8.0 | % | 7.6 | % | 0.4 | % | 5.3 | % | ||||||||
Win per unit per day (gross) (in dollars) |
$ | 281 | $ | 269 | $ | 12 | 4.5 | % | ||||||||
Table games: |
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Drop |
$ | 50,927 | $ | 53,524 | $ | (2,597 | ) | (4.9 | %) | |||||||
Revenues |
$ | 9,246 | $ | 9,171 | $ | 75 | 0.8 | % | ||||||||
Weighted average number of games (in units) |
66 | 66 | | | ||||||||||||
Hold percentage (2) |
18.2 | % | 17.1 | % | 1.1 | % | 6.4 | % | ||||||||
Win per unit per day (in dollars) |
$ | 1,540 | $ | 1,527 | $ | 13 | 0.9 | % | ||||||||
Poker: |
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Revenues |
$ | 871 | $ | 1,074 | $ | (203 | ) | (18.9 | %) | |||||||
Weighted average number of tables (in units) |
18 | 18 | | | ||||||||||||
Revenue per unit per day (in dollars) |
$ | 531 | $ | 656 | $ | (125 | ) | (19.1 | %) |
(1) | Free promotional slot plays are included in slot handle, but not reflected in slot revenues. |
(2) | Table game hold percentage is relatively predictable over longer periods of time, but can significantly fluctuate over shorter periods. |
Non-gaming revenues (in thousands, except where noted, unaudited):
For the Three Months Ended | ||||||||||||||||
June 30, 2012 |
June 30, 2011 |
Variance | Percentage Variance |
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Food and beverage: |
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Revenues |
$ | 6,537 | $ | 6,549 | $ | (12 | ) | (0.2 | %) | |||||||
Meals served |
186 | 219 | (33 | ) | (15.1 | %) | ||||||||||
Average price per meal served (in dollars) |
$ | 15.98 | $ | 15.16 | $ | 0.82 | 5.4 | % | ||||||||
Retail, entertainment and other: |
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Revenues |
$ | 2,326 | $ | 2,209 | $ | 117 | 5.3 | % |
Corporate
Loss from operations (in thousands, unaudited):
For the Three Months Ended | ||||||||||||||||
June 30, 2012 |
June 30, 2011 |
Variance | Percentage Variance |
|||||||||||||
Loss from operations |
$ | 4,681 | $ | 3,896 | $ | 785 | 20.1 | % |
The increase in loss from operations primarily resulted from higher development related expenditures.
Mohegan Tribal Gaming Authority Property Information
(in thousands, unaudited) | Income (Loss) from Operations For the Three Months Ended |
Adjusted
EBITDA For the Three Months Ended |
Net
Revenues For the Three Months Ended |
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June 30, 2012 |
June 30, 2011 |
June 30, 2012 |
June 30, 2011 |
June 30, 2012 |
June 30, 2011 |
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Mohegan Sun |
$ | 44,801 | $ | 56,316 | $ | 62,525 | $ | 73,682 | $ | 264,876 | $ | 284,289 | ||||||||||||
Mohegan Sun at Pocono Downs |
10,716 | 7,677 | 14,686 | 12,881 | 79,560 | 77,090 | ||||||||||||||||||
Corporate |
(4,681 | ) | (3,896 | ) | (4,315 | ) | (3,370 | ) | | | ||||||||||||||
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Total |
$ | 50,836 | $ | 60,097 | $ | 72,896 | $ | 83,193 | $ | 344,436 | $ | 361,379 | ||||||||||||
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Income (Loss) from Operations For the Nine Months Ended |
Adjusted
EBITDA For the Nine Months Ended |
Net
Revenues For the Nine Months Ended |
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June 30, 2012 |
June 30, 2011 |
June 30, 2012 |
June 30, 2011 |
June 30, 2012 |
June 30, 2011 |
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Mohegan Sun |
$ | 148,424 | $ | 152,107 | $ | 200,726 | $ | 204,918 | $ | 811,838 | $ | 822,284 | ||||||||||||
Mohegan Sun at Pocono Downs |
31,660 | 21,590 | 43,660 | 37,349 | 235,628 | 222,644 | ||||||||||||||||||
Corporate |
(12,748 | ) | (12,288 | ) | (11,506 | ) | (10,763 | ) | | | ||||||||||||||
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Total |
$ | 167,336 | $ | 161,409 | $ | 232,880 | $ | 231,504 | $ | 1,047,466 | $ | 1,044,928 | ||||||||||||
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Other Information
Liquidity
As of June 30, 2012, the Authority held cash and cash equivalents of $120.5 million compared to $112.2 million as of September 30, 2011. As of June 30, 2012, no amount was drawn on the Authoritys $75.0 million revolving bank credit facility. As of June 30, 2012, letters of credit issued under the Authoritys bank credit facilities totaled $2.3 million, of which no amounts were drawn. Inclusive of letters of credit, which reduce borrowing availability under the Authoritys bank credit facilities, and after taking into account restrictive financial covenant requirements, the Authority had approximately $72.7 million of borrowing capacity under its bank credit facilities as of June 30, 2012. As of June 30, 2012, the Authoritys debt, including capital leases, totaled $1.66 billion compared to $1.64 billion as of September 30, 2011.
Interest Expense
Interest expense increased by $12.2 million, or 41.5%, to $41.6 million for the quarter ended June 30, 2012 compared to $29.4 million in the third quarter of fiscal 2011. The increase in interest expense was primarily due to higher weighted average interest rate. Weighted average interest rate was 9.9% for the quarter ended June 30, 2012 compared to 7.2% in the third quarter of fiscal 2011. The increase in weighted average interest rate was driven by our March 6, 2012 refinancing transactions. Weighted average outstanding debt was $1.67 billion for the quarter ended June 30, 2012 compared to $1.63 billion in the third quarter of fiscal 2011.
Capital Expenditures
The following table presents data related to capital expenditures (in millions):
Capital Expenditures | ||||||||||||
Nine Months Ended June 30, 2012 |
Remaining Forecasted Fiscal Year 2012 |
Total Forecasted Fiscal Year 2012 |
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Mohegan Sun: |
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Maintenance |
$ | 24.1 | $ | 8.9 | $ | 33.0 | ||||||
Development |
5.6 | 4.4 | 10.0 | |||||||||
Expansion - Project Horizon |
0.3 | | 0.3 | |||||||||
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Subtotal |
30.0 | 13.3 | 43.3 | |||||||||
Mohegan Sun at Pocono Downs: |
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Maintenance |
3.8 | 0.2 | 4.0 | |||||||||
Expansion (1) |
(0.3 | ) | | (0.3 | ) | |||||||
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Subtotal |
3.5 | 0.2 | 3.7 | |||||||||
Corporate: |
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Expansion - Project Sunlight |
0.6 | 5.2 | 5.8 | |||||||||
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Subtotal |
0.6 | 5.2 | 5.8 | |||||||||
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Total |
$ | 34.1 | $ | 18.7 | $ | 52.8 | ||||||
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(1) | Represents adjustments to the cost for Project Sunrise and table game and poker operations expansions. |
Project Sunlight
Mohegan Sun at Pocono Downs recently commenced Project Sunlight, an estimated $50 million hotel expansion project to be located adjacent to the Mohegan Sun at Pocono Downs casino. This expansion will include a 238-room hotel and a 20,000-square-foot convention center. The hotel will include a combination of standard guest rooms and suites and feature rooms with exclusive views of the race track, as well as a fitness center, an indoor pool and a bistro serving breakfast and light fare. A new porte-cochere also is being added for additional guest convenience. The convention center will be located adjacent to the hotel and will be able to accommodate a number of different sized groups up to 800 for seated banquets. This space also can be converted into a 1,500-seat concert venue. The hotel and convention center are being developed and built by Downs Lodging, LLC, a wholly-owned unrestricted subsidiary of the Authority. Project Sunlight is expected to be completed by the end of 2013.
Distributions to the Tribe
Distributions to the Tribe totaled $12.5 million for the quarter ended June 30, 2012 compared to $14.6 million in the third quarter of fiscal 2011. Distributions to the Tribe are anticipated to total $53.0 million for fiscal 2012.
Conference Call
The Authority will host a conference call and simultaneous webcast regarding its third quarter fiscal 2012 operating results on Tuesday, July 31, 2012 at 11:00 a.m. (Eastern Daylight Time).
Those interested in participating in the call should dial as follows:
(877) 756-4274
(706) 643-0107 (International)
Conference ID: 13602298
Please call five minutes in advance to ensure that you are connected prior to the initiation of the call. Questions and answers will be reserved for call-in analysts and investors.
Parties who want to listen to the live conference call on the Internet may do so through a web link on the Authoritys website at www.mtga.com, under the Investor Relations/Financial News section. Interested parties also may listen to a taped replay of the entire conference call commencing two hours after the calls completion on Tuesday, July 31, 2012. This replay will run through August 14, 2012.
The access number for a taped replay of the conference call is as follows:
(855) 859-2056
(404) 537-3406 (International)
Conference ID: 13602298
A transcript will be available on the Authoritys website for a period of 90 days following the conference call.
About the Authority
The Authority is an instrumentality of the Mohegan Tribe of Indians of Connecticut, or the Tribe, a federally-recognized Indian tribe with an approximately 544-acre reservation situated in Southeastern Connecticut, adjacent to Uncasville, Connecticut. The Authority has been granted the exclusive authority to conduct and regulate gaming activities on the existing reservation of the Tribe, including the operation of Mohegan Sun, a gaming and entertainment complex located on a 185-acre site on the Tribes reservation. Through its subsidiary, Downs Racing, L.P., the Authority also owns and operates Mohegan Sun at Pocono Downs, a gaming and entertainment facility located on a 400-acre site in Plains Township, Pennsylvania, and several off-track wagering facilities located elsewhere in Pennsylvania.
The Tribes gaming operation at Mohegan Sun is one of only two legally authorized gaming operations in New England offering traditional slot machines and table games. Mohegan Sun currently operates in an approximately 3.1 million square-foot facility, which includes Casino of the Earth, Casino of the Sky, Casino of the Wind, 100,000 square feet of retail space, including The Shops at Mohegan Sun, a 10,000-seat Mohegan Sun Arena, a 350-seat Cabaret Theatre, 100,000 square feet of meeting and convention space and the approximately 1,200-room luxury Sky Hotel Tower. Mohegan Sun at Pocono Downs operates in an approximately 400,000-square-foot facility, offering traditional slot machines and table games, live harness racing and simulcast and off-track wagering, several dining and retail options and a bus passenger lounge. More information about the Authority and its properties can be obtained by visiting www.mohegansun.com, www.mohegansunpocono.com or www.mtga.com.
Special Note Regarding Forward-Looking Statements
Some information included in this press release may contain forward-looking statements, within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. These statements can sometimes be identified by the use of forward-looking words such as may, will, anticipate, estimate, expect or intend and similar expressions. Such forward-looking information may involve important risks and uncertainties that could significantly affect anticipated results in the future and, accordingly, such results may differ materially from those expressed in any forward-looking statements made by or on behalf of the Authority. Information concerning potential factors that could affect the Authoritys financial results is included in its Annual Report on Form 10-K for the fiscal year ended September 30, 2011, as well as in the Authoritys other reports and filings with the Securities and Exchange Commission. Any forward-looking statements included in this press release are made only as of the date of this release. The Authority does not undertake any obligation to update or supplement any forward-looking statements to reflect subsequent events or circumstances. The Authority cannot assure that projected results or events will be achieved or will occur.
MOHEGAN TRIBAL GAMING AUTHORITY
CONSOLIDATED STATEMENTS OF INCOME
(in thousands)
(unaudited)
For the Three Months Ended June 30, 2012 |
For the Three Months Ended June 30, 2011 |
For
the Nine Months Ended June 30, 2012 |
For
the Nine Months Ended June 30, 2011 |
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Revenues: |
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Gaming |
$ | 307,093 | $ | 328,317 | $ | 940,753 | $ | 952,418 | ||||||||
Food and beverage |
22,700 | 22,446 | 68,627 | 65,669 | ||||||||||||
Hotel |
10,152 | 9,134 | 29,524 | 26,788 | ||||||||||||
Retail, entertainment and other |
29,946 | 29,123 | 82,458 | 77,947 | ||||||||||||
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Gross revenues |
369,891 | 389,020 | 1,121,362 | 1,122,822 | ||||||||||||
Less - Promotional allowances |
(25,455 | ) | (27,641 | ) | (73,896 | ) | (77,894 | ) | ||||||||
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Net revenues |
344,436 | 361,379 | 1,047,466 | 1,044,928 | ||||||||||||
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Operating costs and expenses: |
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Gaming |
193,019 | 198,923 | 582,017 | 587,247 | ||||||||||||
Food and beverage |
11,240 | 10,421 | 33,355 | 30,861 | ||||||||||||
Hotel |
3,658 | 3,413 | 10,703 | 9,906 | ||||||||||||
Retail, entertainment and other |
10,578 | 9,081 | 29,819 | 23,247 | ||||||||||||
Advertising, general and administrative |
48,730 | 52,978 | 147,186 | 151,400 | ||||||||||||
Corporate |
4,651 | 3,856 | 12,653 | 12,163 | ||||||||||||
Depreciation and amortization |
21,693 | 22,621 | 64,077 | 68,451 | ||||||||||||
Loss on disposition of assets |
31 | | 320 | | ||||||||||||
Severance |
| (11 | ) | | 244 | |||||||||||
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Total operating costs and expenses |
293,600 | 301,282 | 880,130 | 883,519 | ||||||||||||
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Income from operations |
50,836 | 60,097 | 167,336 | 161,409 | ||||||||||||
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Other income (expense): |
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Accretion of discount to the relinquishment liability |
(2,062 | ) | (2,842 | ) | (6,186 | ) | (8,525 | ) | ||||||||
Interest income |
1,842 | 665 | 3,559 | 2,063 | ||||||||||||
Interest expense |
(41,581 | ) | (29,378 | ) | (103,047 | ) | (88,837 | ) | ||||||||
Loss on early exchange of debt |
(17 | ) | | (14,323 | ) | | ||||||||||
Other income (expense), net |
7 | 118 | (31 | ) | (226 | ) | ||||||||||
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Total other expense |
(41,811 | ) | (31,437 | ) | (120,028 | ) | (95,525 | ) | ||||||||
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Net income |
9,025 | 28,660 | 47,308 | 65,884 | ||||||||||||
Loss attributable to non-controlling interests |
336 | 486 | 1,147 | 1,400 | ||||||||||||
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Net income attributable to Mohegan Tribal Gaming Authority |
$ | 9,361 | $ | 29,146 | $ | 48,455 | $ | 67,284 | ||||||||
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MOHEGAN TRIBAL GAMING AUTHORITY
CONSOLIDATED SELECTED FINANCIAL INFORMATION
(in thousands)
(unaudited)
For the Three Months Ended | For the Nine Months Ended | |||||||||||||||
June 30, 2012 |
June 30, 2011 |
June 30, 2012 |
June 30, 2011 |
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Operating Results: |
||||||||||||||||
Gross revenues |
$ | 369,891 | $ | 389,020 | $ | 1,121,362 | $ | 1,122,822 | ||||||||
Net revenues |
$ | 344,436 | $ | 361,379 | $ | 1,047,466 | $ | 1,044,928 | ||||||||
Income from operations |
$ | 50,836 | $ | 60,097 | $ | 167,336 | $ | 161,409 | ||||||||
Other Data: |
||||||||||||||||
Adjusted EBITDA |
$ | 72,896 | $ | 83,193 | $ | 232,880 | $ | 231,504 | ||||||||
Capital expenditures |
$ | 8,707 | $ | 16,871 | $ | 34,131 | $ | 34,013 | ||||||||
Cash interest paid |
$ | 8,609 | $ | 27,491 | $ | 78,119 | $ | 82,377 | ||||||||
June 30, 2012 |
September 30, 2011 |
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Balance Sheet Data: |
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Cash and cash equivalents |
$ | 120,530 | $ | 112,174 | ||||||||||||
Debt, including capital leases |
$ | 1,662,268 | $ | 1,635,758 |
MOHEGAN SUN
SUPPLEMENTAL DATA - OPERATING STATISTICS
(unaudited)
For the Three Months Ended | For the Nine Months Ended | |||||||||||||||
June 30, 2012 |
June 30, 2011 |
June 30, 2012 |
June 30, 2011 |
|||||||||||||
Operating results: |
||||||||||||||||
Gross revenues (in thousands) |
$ | 286,281 | $ | 307,861 | $ | 873,725 | $ | 889,178 | ||||||||
Net revenues (in thousands) |
$ | 264,876 | $ | 284,289 | $ | 811,838 | $ | 822,284 | ||||||||
Income from operations (in thousands) |
$ | 44,801 | $ | 56,316 | $ | 148,424 | $ | 152,107 | ||||||||
Operating margin |
16.9 | % | 19.8 | % | 18.3 | % | 18.5 | % | ||||||||
Adjusted EBITDA: |
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Adjusted EBITDA (in thousands) |
$ | 62,525 | $ | 73,682 | $ | 200,726 | $ | 204,918 | ||||||||
Adjusted EBITDA margin |
23.6 | % | 25.9 | % | 24.7 | % | 24.9 | % | ||||||||
Capital expenditures (in thousands) |
$ | 7,054 | $ | 15,793 | $ | 29,967 | $ | 29,889 | ||||||||
Weighted average number of units: |
||||||||||||||||
Slot machines |
5,953 | 6,358 | 6,085 | 6,377 | ||||||||||||
Table games |
314 | 324 | 314 | 329 | ||||||||||||
Poker tables |
42 | 42 | 42 | 42 | ||||||||||||
Win per unit per day: |
||||||||||||||||
Slot machines (gross) |
$ | 305 | $ | 310 | $ | 302 | $ | 301 | ||||||||
Table games |
$ | 2,421 | $ | 2,775 | $ | 2,560 | $ | 2,525 | ||||||||
Poker tables |
$ | 687 | $ | 756 | $ | 756 | $ | 762 | ||||||||
Hold percentage: |
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Slot machines (gross) |
8.2 | % | 8.1 | % | 8.3 | % | 8.0 | % | ||||||||
Table games |
14.7 | % | 16.7 | % | 15.2 | % | 15.3 | % | ||||||||
Food and beverage statistics: |
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Meals served (in thousands) |
804 | 802 | 2,408 | 2,433 | ||||||||||||
Average price per meal served |
$ | 16.17 | $ | 15.71 | $ | 16.40 | $ | 15.50 | ||||||||
Hotel statistics: |
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Rooms occupied (in thousands) |
103 | 105 | 308 | 310 | ||||||||||||
Occupancy rate |
96.3 | % | 97.5 | % | 95.8 | % | 96.5 | % | ||||||||
Average daily room rate |
$ | 93 | $ | 84 | $ | 91 | $ | 83 | ||||||||
Revenue per available room |
$ | 89 | $ | 82 | $ | 87 | $ | 80 | ||||||||
Entertainment statistics: |
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Arena events (in events) |
38 | 30 | 91 | 79 | ||||||||||||
Arena tickets (in thousands) |
229 | 182 | 529 | 449 | ||||||||||||
Average price per Arena ticket |
$ | 42.23 | $ | 57.18 | $ | 45.12 | $ | 54.04 |
MOHEGAN SUN AT POCONO DOWNS
SUPPLEMENTAL DATA - OPERATING STATISTICS
(unaudited)
For the Three Months Ended | For the Nine Months Ended | |||||||||||||||
June 30, 2012 |
June 30, 2011 |
June 30, 2012 |
June 30, 2011 |
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Operating results: |
||||||||||||||||
Gross revenues (in thousands) |
$ | 83,610 | $ | 81,159 | $ | 247,637 | $ | 233,644 | ||||||||
Net revenues (in thousands) |
$ | 79,560 | $ | 77,090 | $ | 235,628 | $ | 222,644 | ||||||||
Income from operations (in thousands) |
$ | 10,716 | $ | 7,677 | $ | 31,660 | $ | 21,590 | ||||||||
Operating margin |
13.5 | % | 10.0 | % | 13.4 | % | 9.7 | % | ||||||||
Adjusted EBITDA: |
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Adjusted EBITDA (in thousands) |
$ | 14,686 | $ | 12,881 | $ | 43,660 | $ | 37,349 | ||||||||
Adjusted EBITDA margin |
18.5 | % | 16.7 | % | 18.5 | % | 16.8 | % | ||||||||
Capital expenditures (in thousands) |
$ | 1,047 | $ | 1,078 | $ | 3,558 | $ | 4,124 | ||||||||
Weighted average number of units: |
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Slot machines |
2,332 | 2,332 | 2,332 | 2,409 | ||||||||||||
Table games |
66 | 66 | 66 | 66 | ||||||||||||
Poker tables |
18 | 18 | 18 | 18 | ||||||||||||
Win per unit per day: |
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Slot machines (gross) |
$ | 281 | $ | 269 | $ | 280 | $ | 254 | ||||||||
Table games |
$ | 1,540 | $ | 1,527 | $ | 1,615 | $ | 1,506 | ||||||||
Poker tables |
$ | 531 | $ | 656 | $ | 586 | $ | 656 | ||||||||
Hold percentage: |
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Slot machines (gross) |
8.0 | % | 7.6 | % | 8.0 | % | 7.8 | % | ||||||||
Table games |
18.2 | % | 17.1 | % | 18.1 | % | 18.2 | % | ||||||||
Food and beverage statistics: |
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Meals served (in thousands) |
186 | 219 | 546 | 578 | ||||||||||||
Average price per meal served |
$ | 15.98 | $ | 15.16 | $ | 15.67 | $ | 15.00 |
MOHEGAN TRIBAL GAMING AUTHORITY
ADJUSTED EBITDA RECONCILIATIONS
(unaudited)
Reconciliations of Adjusted EBITDA to Net Income:
Reconciliations of Adjusted EBITDA to net income, a financial measure determined in accordance with accounting principles generally accepted in the United States of America, or GAAP, are shown below (in thousands):
For the Three Months Ended | For the Nine Months Ended | |||||||||||||||
June 30, 2012 |
June 30, 2011 |
June 30, 2012 |
June 30, 2011 |
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Adjusted EBITDA |
$ | 72,896 | $ | 83,193 | $ | 232,880 | $ | 231,504 | ||||||||
Depreciation and amortization |
(21,693 | ) | (22,621 | ) | (64,077 | ) | (68,451 | ) | ||||||||
Loss on disposition of assets |
(31 | ) | | (320 | ) | | ||||||||||
Severance |
| 11 | | (244 | ) | |||||||||||
Loss attributable to non-controlling interests |
(336 | ) | (486 | ) | (1,147 | ) | (1,400 | ) | ||||||||
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Income from operations |
50,836 | 60,097 | 167,336 | 161,409 | ||||||||||||
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Accretion of discount to the relinquishment liability |
(2,062 | ) | (2,842 | ) | (6,186 | ) | (8,525 | ) | ||||||||
Interest income |
1,842 | 665 | 3,559 | 2,063 | ||||||||||||
Interest expense |
(41,581 | ) | (29,378 | ) | (103,047 | ) | (88,837 | ) | ||||||||
Loss on early exchange of debt |
(17 | ) | | (14,323 | ) | | ||||||||||
Other income (expense), net |
7 | 118 | (31 | ) | (226 | ) | ||||||||||
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Net income |
$ | 9,025 | $ | 28,660 | $ | 47,308 | $ | 65,884 | ||||||||
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Reconciliations of Income (Loss) from Operations to Adjusted EBITDA (unaudited):
Reconciliations of income (loss) from operations, a financial measure determined in accordance with GAAP, to Adjusted EBITDA, are shown below (in thousands):
For the Three Months Ended June 30, 2012 | ||||||||||||||||||||||||
Income (Loss) from Operations |
Depreciation and Amortization |
Loss on Disposition of Assets |
Severance | Loss attributable to Non-controlling Interests |
Adjusted EBITDA |
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Mohegan Sun |
$ | 44,801 | $ | 17,706 | $ | 18 | $ | | $ | | $ | 62,525 | ||||||||||||
Mohegan Sun at Pocono Downs |
10,716 | 3,957 | 13 | | | 14,686 | ||||||||||||||||||
Corporate |
(4,681 | ) | 30 | | | 336 | (4,315 | ) | ||||||||||||||||
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Total |
$ | 50,836 | $ | 21,693 | $ | 31 | $ | | $ | 336 | $ | 72,896 | ||||||||||||
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For the Three Months Ended June 30, 2011 | ||||||||||||||||||||||||
Income (Loss) from Operations |
Depreciation and Amortization |
Loss on Disposition of Assets |
Severance | Loss attributable to Non-controlling Interests |
Adjusted EBITDA |
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Mohegan Sun |
$ | 56,316 | $ | 17,377 | $ | | $ | (11 | ) | $ | | $ | 73,682 | |||||||||||
Mohegan Sun at Pocono Downs |
7,677 | 5,204 | | | | 12,881 | ||||||||||||||||||
Corporate |
(3,896 | ) | 40 | | | 486 | (3,370 | ) | ||||||||||||||||
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Total |
$ | 60,097 | $ | 22,621 | $ | | $ | (11 | ) | $ | 486 | $ | 83,193 | |||||||||||
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For the Nine Months Ended June 30, 2012 | ||||||||||||||||||||||||
Income (Loss) from Operations |
Depreciation and Amortization |
Loss on Disposition of Assets |
Severance | Loss attributable to Non-controlling Interests |
Adjusted EBITDA |
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Mohegan Sun |
$ | 148,424 | $ | 52,266 | $ | 36 | $ | | $ | | $ | 200,726 | ||||||||||||
Mohegan Sun at Pocono Downs |
31,660 | 11,716 | 284 | | | 43,660 | ||||||||||||||||||
Corporate |
(12,748 | ) | 95 | | | 1,147 | (11,506 | ) | ||||||||||||||||
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Total |
$ | 167,336 | $ | 64,077 | $ | 320 | $ | | $ | 1,147 | $ | 232,880 | ||||||||||||
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For the Nine Months Ended June 30, 2011 | ||||||||||||||||||||||||
Income (Loss) from Operations |
Depreciation and Amortization |
Loss on Disposition of Assets |
Severance | Loss attributable to Non-controlling Interests |
Adjusted EBITDA |
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Mohegan Sun |
$ | 152,107 | $ | 52,569 | $ | | $ | 242 | $ | | $ | 204,918 | ||||||||||||
Mohegan Sun at Pocono Downs |
21,590 | 15,759 | | | | 37,349 | ||||||||||||||||||
Corporate |
(12,288 | ) | 123 | | 2 | 1,400 | (10,763 | ) | ||||||||||||||||
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Total |
$ | 161,409 | $ | 68,451 | $ | | $ | 244 | $ | 1,400 | $ | 231,504 | ||||||||||||
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Adjusted EBITDA Explanation:
Earnings before interest, income taxes, depreciation and amortization, or EBITDA, is a commonly used measure of performance in the casino and hospitality industry. EBITDA is not a measure of performance calculated in accordance with GAAP. The Authority historically has evaluated its operating performance with the non-GAAP measure, Adjusted EBITDA, which as used in this press release, represents earnings before interest, depreciation and amortization, loss on disposition of assets, workforce reduction severance, accretion of discount to a relinquishment liability, loss on early exchange of debt, other non-operating income and expense and loss attributable to non-controlling interests.
Adjusted EBITDA provides an additional way to evaluate the Authoritys operations and, when viewed with both the Authoritys GAAP results and the reconciliations provided, the Authority believes that it provides a more complete understanding of its business than could be otherwise obtained absent this disclosure. Adjusted EBITDA is presented solely as a supplemental disclosure because: (1) the Authority believes it enhances an overall understanding of the Authoritys past and current financial performance; (2) the Authority believes it is a useful tool for investors to assess the operating performance of the business in comparison to other operators within the casino and hospitality industry since Adjusted EBITDA excludes certain items that may not be indicative of the Authoritys operating results; (3) measures that are comparable to Adjusted EBITDA are often used as an important basis for the valuation of casino and hospitality companies; and (4) the Authority uses Adjusted EBITDA internally to evaluate the performance of its operating personnel and management and as a benchmark to evaluate its operating performance in comparison to its competitors.
The use of Adjusted EBITDA has certain limitations. Adjusted EBITDA should be considered in addition to, not as a substitute for or superior to, any GAAP financial measure including net income (as an indicator of the Authoritys performance) or cash flows provided by operating activities (as an indicator of the Authoritys liquidity), nor should it be considered as an indicator of the Authoritys overall financial performance. The Authoritys calculation of Adjusted EBITDA is likely to be different from the calculation of Adjusted EBITDA or other similarly titled measurements used by other casino and hospitality companies, and therefore, comparability may be limited. Adjusted EBITDA eliminates certain items from net income, such as interest, depreciation and amortization and reassessment and accretion of discount to the relinquishment liability. Each of these items has been incurred in the past, will continue to be incurred in the future and should be considered in the overall evaluation of the Authoritys results. The Authority compensates for these limitations by providing the relevant disclosure of interest, depreciation and amortization, reassessment and accretion of discount to the relinquishment liability and other items excluded in the calculation of Adjusted EBITDA, both in its reconciliations to the GAAP financial measure of net income and in its consolidated financial statements, all of which should be considered when evaluating its results. The Authority strongly encourages investors to review its financial information in its entirety and not to rely on a single financial measure.
Press Release:
Mohegan Tribal Gaming Authority, Uncasville, Connecticut, July 31, 2012
Contacts:
Mitchell Grossinger Etess
Chief Executive Officer
Mohegan Tribal Gaming Authority
(860) 862-8000
Mario C. Kontomerkos
Chief Financial Officer
Mohegan Tribal Gaming Authority
(860) 862-8000