UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
Date of report (Date of earliest event reported): July 30, 2013
MOHEGAN TRIBAL GAMING AUTHORITY
(Exact name of registrant as specified in its charter)
| Not Applicable | 033-80655 | 06-1436334 | ||
| (State or other jurisdiction of incorporation) |
(Commission File Number) |
(IRS Employer Identification No.) |
| One Mohegan Sun Boulevard, Uncasville, CT | 06382 | |
| (Address of principal executive offices) | (Zip Code) |
(860) 862-8000
(Registrant’s telephone number, including area code)
Not Applicable
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
| ¨ | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
| ¨ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
| ¨ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
| ¨ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
| Section 2 | Financial Information |
| Item 2.02 | Results of Operations and Financial Condition. |
The Mohegan Tribal Gaming Authority (the “Authority”) today issued a press release announcing the operating results for its third fiscal quarter ended June 30, 2013. A copy of the press release is attached hereto as Exhibit 99.1. The press release and related information also may be found on the Authority’s website at www.mtga.com, under “Investor Relations/Financial News.”
The information, including the exhibit attached hereto, in this Current Report is being furnished and shall not be deemed to be “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to liability under that section, and shall not be incorporated by reference into any registration statement or other document filed under the Securities Act of 1933, as amended, except as expressly set forth by specific reference in such filing.
| Section 9 | Financial Statements and Exhibits |
| Item 9.01 | Financial Statements and Exhibits. |
(d) Exhibits
The following exhibit is furnished as part of this Current Report:
99.1 Press Release of the Mohegan Tribal Gaming Authority, dated July 30, 2013.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| MOHEGAN TRIBAL GAMING AUTHORITY | ||||||
| Date: July 30, 2013 | By: | /s/ Bruce S. Bozsum | ||||
| Bruce S. Bozsum | ||||||
| Chairman, Management Board | ||||||
Exhibit Index
| Exhibit |
Description | |
| 99.1 | Press Release of the Mohegan Tribal Gaming Authority, dated July 30, 2013. | |
Exhibit 99.1
MOHEGAN TRIBAL GAMING AUTHORITY ANNOUNCES
THIRD QUARTER FISCAL 2013 OPERATING RESULTS
Uncasville, Connecticut, July 30, 2013 – 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 fiscal quarter ended June 30, 2013.
“Our results for the third quarter were quite rewarding,” said Mitchell Grossinger Etess, Chief Executive Officer of the Authority. “The growth in Adjusted EBITDA and margins at both Mohegan Sun and Mohegan Sun at Pocono Downs demonstrates the commitment of our entire team towards pursuing operational efficiencies while providing the ultimate guest experience. We are also extremely optimistic with the stabilization, and, in some cases, increases in revenues.”
Consolidated operating results for the third quarter ended June 30, 2013 (unaudited):
| • | Net revenues of $344.2 million, a 0.1% decrease from the third quarter of fiscal 2012 |
| • | Gaming revenues of $304.6 million, a 0.8% decrease from the third quarter of fiscal 2012 |
| • | Gross slot revenues of $214.7 million, a 4.5% decrease from the third quarter of fiscal 2012 |
| • | Table game revenues of $86.2 million, a 10.0% increase over the third quarter of fiscal 2012 |
| • | Non-gaming revenues of $65.1 million, a 3.6% increase over the third quarter of fiscal 2012 |
| • | Adjusted EBITDA, a non-GAAP measure described below, of $85.1 million, a 16.7% increase over the third quarter of fiscal 2012 |
| • | Adjusted EBITDA margin of 24.7%, a 350 basis point increase over the third quarter of fiscal 2012 |
| • | Income from operations of $64.2 million, a 26.3% increase over the third quarter of fiscal 2012 |
| • | Net income attributable to the Authority of $22.3 million, a 138.2% increase over the third quarter of fiscal 2012 |
The increases in Adjusted EBITDA, income from operations and net income were primarily attributable to higher table game revenues and lower operating costs and expenses resulting from cost saving initiatives designed to improve efficiency and profitability at both Mohegan Sun and Mohegan Sun at Pocono Downs.
Mohegan Sun
Operating results (in thousands, unaudited):
| For the Three Months Ended | ||||||||||||||||
| June 30, 2013 |
June 30, 2012 |
Variance | Percentage Variance |
|||||||||||||
| Adjusted EBITDA |
$ | 74,790 | $ | 62,525 | $ | 12,265 | 19.6 | % | ||||||||
| Income from operations |
$ | 57,396 | $ | 44,801 | $ | 12,595 | 28.1 | % | ||||||||
| Operating costs and expenses |
$ | 209,303 | $ | 220,075 | $ | (10,772 | ) | (4.9 | %) | |||||||
| Net revenues |
$ | 266,699 | $ | 264,876 | $ | 1,823 | 0.7 | % | ||||||||
| Gaming revenues |
$ | 232,161 | $ | 232,346 | $ | (185 | ) | (0.1 | %) | |||||||
| Non-gaming revenues |
$ | 55,274 | $ | 53,935 | $ | 1,339 | 2.5 | % | ||||||||
The growth in Adjusted EBITDA and income from operations was primarily attributable to higher table game revenues, combined with the reduction in operating costs and expenses, reflecting, in part, staffing reductions and other cost saving initiatives implemented in September 2012. These results were partially offset by lower slot revenues, which we believe reflected continued economic weakness in New England and the impact of competition. Table game revenues benefited from higher table game hold during the quarter. The growth in Adjusted EBITDA and income from operations also reflected higher entertainment revenues due to an increase in the number of headliner shows held at the Mohegan Sun Arena. Adjusted EBITDA margin increased 440 basis points to 28.0% for the quarter ended June 30, 2013 from 23.6% in the third quarter of fiscal 2012.
1
Selected gaming data (in thousands, except where noted, unaudited):
| For the Three Months Ended | ||||||||||||||||
| June 30, 2013 |
June 30, 2012 |
Variance | Percentage Variance |
|||||||||||||
| Slots: |
||||||||||||||||
| Handle |
$ | 1,923,281 | $ | 2,010,037 | $ | (86,756 | ) | (4.3 | %) | |||||||
| Gross revenues |
$ | 158,129 | $ | 165,224 | $ | (7,095 | ) | (4.3 | %) | |||||||
| Net revenues |
$ | 152,086 | $ | 158,761 | $ | (6,675 | ) | (4.2 | %) | |||||||
| Free promotional slot plays (1) |
$ | 17,624 | $ | 18,236 | $ | (612 | ) | (3.4 | %) | |||||||
| Weighted average number of machines (in units) |
5,530 | 5,953 | (423 | ) | (7.1 | %) | ||||||||||
| Hold percentage (gross) |
8.2 | % | 8.2 | % | — | — | ||||||||||
| Win per unit per day (gross) (in dollars) |
$ | 314 | $ | 305 | $ | 9 | 3.0 | % | ||||||||
| Table games: |
||||||||||||||||
| Drop |
$ | 467,768 | $ | 469,276 | $ | (1,508 | ) | (0.3 | %) | |||||||
| Revenues |
$ | 76,176 | $ | 69,150 | $ | 7,026 | 10.2 | % | ||||||||
| Weighted average number of games (in units) |
284 | 314 | (30 | ) | (9.6 | %) | ||||||||||
| Hold percentage (2) |
16.3 | % | 14.7 | % | 1.6 | % | 10.9 | % | ||||||||
| Win per unit per day (in dollars) |
$ | 2,944 | $ | 2,421 | $ | 523 | 21.6 | % | ||||||||
| Poker: |
||||||||||||||||
| Revenues |
$ | 2,314 | $ | 2,627 | $ | (313 | ) | (11.9 | %) | |||||||
| Weighted average number of tables (in units) |
42 | 42 | — | — | ||||||||||||
| Revenue per unit per day (in dollars) |
$ | 606 | $ | 687 | $ | (81 | ) | (11.8 | %) | |||||||
| (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 data (in thousands, except where noted, unaudited):
| For the Three Months Ended | ||||||||||||||||
| June 30, 2013 |
June 30, 2012 |
Variance | Percentage Variance |
|||||||||||||
| Food and beverage: |
||||||||||||||||
| Revenues |
$ | 15,341 | $ | 16,163 | $ | (822 | ) | (5.1 | %) | |||||||
| Meals served |
708 | 809 | (101 | ) | (12.5 | %) | ||||||||||
| Average price per meal served (in dollars) |
$ | 16.38 | $ | 16.08 | $ | 0.30 | 1.9 | % | ||||||||
| Hotel: |
||||||||||||||||
| Revenues |
$ | 10,318 | $ | 10,152 | $ | 166 | 1.6 | % | ||||||||
| Rooms occupied |
104 | 103 | 1 | 1.0 | % | |||||||||||
| Occupancy rate |
96.7 | % | 96.3 | % | 0.4 | % | 0.4 | % | ||||||||
| Average daily room rate (in dollars) |
$ | 95 | $ | 93 | 2 | 2.2 | % | |||||||||
| Revenue per available room (in dollars) |
$ | 92 | $ | 89 | 3 | 3.4 | % | |||||||||
| Retail, entertainment and other: |
||||||||||||||||
| Revenues |
$ | 29,615 | $ | 27,620 | $ | 1,995 | 7.2 | % | ||||||||
| Arena events (in events) |
26 | 38 | (12 | ) | (31.6 | %) | ||||||||||
| Arena tickets |
174 | 229 | (55 | ) | (24.0 | %) | ||||||||||
| Average price per Arena ticket (in dollars) |
$ | 61.45 | $ | 42.23 | $ | 19.22 | 45.5 | % | ||||||||
2
Mohegan Sun at Pocono Downs
Operating results (in thousands, unaudited):
| For the Three Months Ended | ||||||||||||||||
| June 30, 2013 |
June 30, 2012 |
Variance | Percentage Variance |
|||||||||||||
| Adjusted EBITDA |
$ | 15,730 | $ | 14,686 | $ | 1,044 | 7.1 | % | ||||||||
| Income from operations |
$ | 12,435 | $ | 10,716 | $ | 1,719 | 16.0 | % | ||||||||
| Operating costs and expenses |
$ | 64,793 | $ | 68,844 | $ | (4,051 | ) | (5.9 | %) | |||||||
| Net revenues |
$ | 77,228 | $ | 79,560 | $ | (2,332 | ) | (2.9 | %) | |||||||
| Gaming revenues |
$ | 72,421 | $ | 74,747 | $ | (2,326 | ) | (3.1 | %) | |||||||
| Non-gaming revenues |
$ | 9,457 | $ | 8,863 | $ | 594 | 6.7 | % | ||||||||
The growth in Adjusted EBITDA and income from operations resulted primarily from higher table game revenues, combined with the reduction in operating costs and expenses, reflecting, in part, cost saving initiatives implemented in March 2013. These results were partially offset by lower slot revenues, which we believe reflected continued economic weakness and higher local property taxes. Table game revenues benefited from slightly higher volumes along with increased table game hold during the quarter. The growth in Adjusted EBITDA and income from operations also reflected higher food and beverage revenues resulting from strong patron response to our promotional offers. We believe overall business volumes were negatively impacted by construction disruptions associated with our hotel and convention center expansion. Adjusted EBITDA margin increased 190 basis points to 20.4% for the quarter ended June 30, 2013 from 18.5% in the third quarter of fiscal 2012.
Selected gaming data (in thousands, except where noted, unaudited):
| For the Three Months Ended | ||||||||||||||||
| June 30, 2013 |
June 30, 2012 |
Variance | Percentage Variance |
|||||||||||||
| Slots: |
||||||||||||||||
| Handle |
$ | 774,897 | $ | 743,645 | $ | 31,252 | 4.2 | % | ||||||||
| Gross revenues |
$ | 56,600 | $ | 59,696 | $ | (3,096 | ) | (5.2 | %) | |||||||
| Net revenues |
$ | 56,575 | $ | 59,667 | $ | (3,092 | ) | (5.2 | %) | |||||||
| Free promotional slot plays (1) |
$ | 23,327 | $ | 15,324 | $ | 8,003 | 52.2 | % | ||||||||
| Weighted average number of machines (in units) |
2,332 | 2,332 | — | — | ||||||||||||
| Hold percentage (gross) |
7.3 | % | 8.0 | % | (0.7 | %) | (8.8 | %) | ||||||||
| Win per unit per day (gross) (in dollars) |
$ | 267 | $ | 281 | $ | (14 | ) | (5.0 | %) | |||||||
| Table games: |
||||||||||||||||
| Drop |
$ | 51,437 | $ | 50,927 | $ | 510 | 1.0 | % | ||||||||
| Revenues |
$ | 10,048 | $ | 9,246 | $ | 802 | 8.7 | % | ||||||||
| Weighted average number of games (in units) |
66 | 66 | — | — | ||||||||||||
| Hold percentage (2) |
19.5 | % | 18.2 | % | 1.3 | % | 7.1 | % | ||||||||
| Win per unit per day (in dollars) |
$ | 1,673 | $ | 1,540 | $ | 133 | 8.6 | % | ||||||||
| Poker: |
||||||||||||||||
| Revenues |
$ | 900 | $ | 871 | $ | 29 | 3.3 | % | ||||||||
| Weighted average number of tables (in units) |
18 | 18 | — | — | ||||||||||||
| Revenue per unit per day (in dollars) |
$ | 549 | $ | 531 | $ | 18 | 3.4 | % | ||||||||
| (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. |
3
Non-gaming revenues (in thousands, except where noted, unaudited):
| For the Three Months Ended | ||||||||||||||||
| June 30, 2013 |
June 30, 2012 |
Variance | Percentage Variance |
|||||||||||||
| Food and beverage: |
||||||||||||||||
| Revenues |
$ | 7,059 | $ | 6,537 | $ | 522 | 8.0 | % | ||||||||
| Meals served |
209 | 186 | 23 | 12.4 | % | |||||||||||
| Average price per meal served (in dollars) |
$ | 15.84 | $ | 15.98 | $ | (0.14 | ) | (0.9 | %) | |||||||
| Retail, entertainment and other: |
||||||||||||||||
| Revenues |
$ | 2,398 | $ | 2,326 | $ | 72 | 3.1 | % | ||||||||
Corporate
Operating results (in thousands, unaudited):
| For the Three Months Ended | ||||||||||||||||
| June 30, 2013 |
June 30, 2012 |
Variance | Percentage Variance |
|||||||||||||
| Loss from operations |
$ | 5,644 | $ | 4,681 | $ | 963 | 20.6 | % | ||||||||
| Net revenues |
$ | 318 | $ | — | $ | 318 | 100.0 | % | ||||||||
The increase in loss from operations reflected higher professional and development related expenditures, including expenditures associated with our pursuit of a Massachusetts casino license.
Mohegan Tribal Gaming Authority Property Information
| (in thousands, unaudited) | Adjusted
EBITDA For the Three Months Ended |
Income (Loss) from Operations For the Three Months Ended |
Net
Revenues For the Three Months Ended |
|||||||||||||||||||||
| June 30, 2013 |
June 30, 2012 |
June 30, 2013 |
June 30, 2012 |
June 30, 2013 |
June 30, 2012 |
|||||||||||||||||||
| Mohegan Sun |
$ | 74,790 | $ | 62,525 | $ | 57,396 | $ | 44,801 | $ | 266,699 | $ | 264,876 | ||||||||||||
| Mohegan Sun at Pocono Downs |
15,730 | 14,686 | 12,435 | 10,716 | 77,228 | 79,560 | ||||||||||||||||||
| Corporate |
(5,469 | ) | (4,315 | ) | (5,644 | ) | (4,681 | ) | 318 | — | ||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
| Total |
$ | 85,051 | $ | 72,896 | $ | 64,187 | $ | 50,836 | $ | 344,245 | $ | 344,436 | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
| Adjusted
EBITDA For the Nine Months Ended |
Income (Loss) from Operations For the Nine Months Ended |
Net
Revenues For the Nine Months Ended |
||||||||||||||||||||||
| June 30, 2013 |
June 30, 2012 |
June 30, 2013 |
June 30, 2012 |
June 30, 2013 |
June 30, 2012 |
|||||||||||||||||||
| Mohegan Sun |
$ | 210,147 | $ | 200,726 | $ | 158,654 | $ | 148,424 | $ | 772,571 | $ | 811,838 | ||||||||||||
| Mohegan Sun at Pocono Downs |
41,876 | 43,660 | 32,441 | 31,660 | 221,155 | 235,628 | ||||||||||||||||||
| Corporate |
(15,888 | ) | (11,506 | ) | (18,743 | ) | (12,748 | ) | 969 | — | ||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
| Total |
$ | 236,135 | $ | 232,880 | $ | 172,352 | $ | 167,336 | $ | 994,695 | $ | 1,047,466 | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
4
Other Information
Liquidity
As of June 30, 2013, the Authority held cash and cash equivalents of $80.3 million compared to $114.1 million as of September 30, 2012. As of June 30, 2013, no amount was drawn on the Authority’s $75.0 million revolving bank credit facility. As of June 30, 2013, letters of credit issued under the Authority’s bank credit facilities totaled $3.4 million, of which no amounts were drawn. Inclusive of letters of credit, which reduce borrowing availability under the Authority’s bank credit facilities, and after taking into account restrictive financial covenant requirements, the Authority had approximately $71.6 million of borrowing capacity under its bank credit facilities as of June 30, 2013.
Long-term Debt
Long-term debt consisted of the following (in thousands, including current maturities):
| June 30, 2013 |
September 30, 2012 |
|||||||
| Bank Credit Facility, due March 2015 |
$ | 394,000 | $ | 397,000 | ||||
| Term Loan Facility, due March 2016, net of discount of $3,263 and $3,988, respectively |
221,737 | 221,012 | ||||||
| 2009 11 1/2% Second Lien Senior Secured Notes, due November 2017, net of discount of $5 and $6, respectively |
195 | 194 | ||||||
| 2012 11 1/2% Second Lien Senior Secured Notes, due November 2017, net of discount of $4,981 and $5,587, respectively |
194,819 | 194,213 | ||||||
| 2012 10 1/2% Third Lien Senior Secured Notes, due December 2016 |
417,771 | 417,771 | ||||||
| 2005 6 1/8% Senior Unsecured Notes, due February 2013 |
— | 15,775 | ||||||
| 2004 7 1/8% Senior Subordinated Notes, due August 2014 |
21,156 | 21,156 | ||||||
| 2005 6 7/8% Senior Subordinated Notes, due February 2015 |
9,654 | 9,654 | ||||||
| 2012 11% Senior Subordinated Notes, due September 2018 |
344,190 | 344,190 | ||||||
| 2009 Mohegan Tribe Promissory Note, due September 2014 |
5,125 | 10,000 | ||||||
| 2012 Mohegan Tribe Minor’s Trust Promissory Note, due March 2016 |
18,500 | 20,000 | ||||||
| Mohegan Tribe Credit Facility, due September 2013 |
363 | 1,450 | ||||||
| 2013 Mohegan Tribe Promissory Note, due December 2018 |
7,420 | — | ||||||
| Downs Lodging Credit Facility, due July 2016 |
45,000 | 45,000 | ||||||
| Salishan-Mohegan Promissory Notes, due December 2014 |
485 | — | ||||||
|
|
|
|
|
|||||
| Subtotal |
1,680,415 | 1,697,415 | ||||||
| Plus: net deferred gain on derivative instruments sold |
320 | 386 | ||||||
|
|
|
|
|
|||||
| Long-term debt, excluding capital leases |
1,680,735 | 1,697,801 | ||||||
| Less: current portion of long-term debt |
(10,670 | ) | (29,737 | ) | ||||
|
|
|
|
|
|||||
| Long-term debt, net of current portion |
$ | 1,670,065 | $ | 1,668,064 | ||||
|
|
|
|
|
|||||
Interest Expense
Interest expense increased by $798,000, or 1.9%, to $42.4 million for the quarter ended June 30, 2013 compared to $41.6 million in the third quarter of fiscal 2012. Weighted average interest rate was 10.1% for the quarter ended June 30, 2013 compared to 9.9% in the third quarter of fiscal 2012. Weighted average outstanding debt was $1.70 billion for the quarter ended June 30, 2013 compared to $1.67 billion in the third quarter of fiscal 2012.
Cost Saving Initiatives
In September 2012, the Authority implemented staffing reductions and other cost saving initiatives at Mohegan Sun. The resulting labor and operating cost savings for fiscal 2013 are currently forecasted to be at least $25 million. In addition, in March 2013, the Authority implemented a number of cost saving initiatives at Mohegan Sun at Pocono Downs. The resulting labor and operating cost savings for fiscal 2013 are currently forecasted to be at least $4 million, while annual labor and operating cost savings are currently forecasted to be at least $7 million. The Authority estimated that these cost saving initiatives yielded consolidated labor and operating cost savings totaling approximately $21 million for the nine months ended June 30, 2013.
5
Capital Expenditures
The following table presents data related to capital expenditures (in millions, including capitalized interest):
| Capital Expenditures | ||||||||||||
| Nine Months Ended June 30, 2013 |
Remaining Forecasted Fiscal Year 2013 |
Forecasted Fiscal Year 2013 |
||||||||||
| Mohegan Sun: |
||||||||||||
| Maintenance |
$ | 13.0 | $ | 12.7 | $ | 25.7 | ||||||
| Development |
3.8 | 0.1 | 3.9 | |||||||||
|
|
|
|
|
|
|
|||||||
| Subtotal |
16.8 | 12.8 | 29.6 | |||||||||
| Mohegan Sun at Pocono Downs: |
||||||||||||
| Maintenance |
3.0 | 1.9 | 4.9 | |||||||||
| Expansion |
0.3 | 0.3 | 0.6 | |||||||||
|
|
|
|
|
|
|
|||||||
| Subtotal |
3.3 | 2.2 | 5.5 | |||||||||
| Corporate: |
||||||||||||
| Expansion - Project Sunlight (1) |
22.4 | 13.0 | 35.4 | |||||||||
| Development |
0.7 | — | 0.7 | |||||||||
|
|
|
|
|
|
|
|||||||
| Subtotal |
23.1 | 13.0 | 36.1 | |||||||||
|
|
|
|
|
|
|
|||||||
| Total |
$ | 43.2 | $ | 28.0 | $ | 71.2 | ||||||
|
|
|
|
|
|
|
|||||||
| (1) | Mohegan Sun at Pocono Downs’ hotel and convention center expansion. |
Distributions to the Tribe
Distributions to the Tribe totaled $15.0 million for the quarter ended June 30, 2013 compared to $12.5 million in the third quarter of fiscal 2012. Distributions to the Tribe are anticipated to total $50 million for fiscal 2013.
Recent Developments
On July 22, 2013, the Authority commenced a solicitation of consents, or the Consent Solicitation, to amend the indenture governing the Authority’s 11.5% Second Lien Senior Secured Notes due 2017 to permit the Authority to refinance its outstanding subordinated notes with senior unsecured indebtedness and to enter into certain transactions with the Tribe in the event that the Tribe constructs a hotel on Tribal land currently leased by the Authority. Please refer to the Authority’s July 22, 2013 press release for further information regarding the Consent Solicitation.
On June 25, 2013, the Authority announced plans for The Downtown District, a major retail expansion at Mohegan Sun featuring 200,000 square feet of entertainment, shopping and dining to be located adjacent to the Winter Garage. The project will be developed by a partnership of The Hampshire Companies and The Bronson Companies. Construction on The Downtown District is expected to begin later this year and is scheduled to open in early 2015.
6
Conference Call
The Authority will host a conference call and simultaneous webcast regarding its third quarter fiscal 2013 operating results on Tuesday, July 30, 2013 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: 23775256
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 Authority’s 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 call’s completion on Tuesday, July 30, 2013. This replay will run through August 13, 2013.
The access number for a taped replay of the conference call is as follows:
(855) 859-2056
(404) 537-3406 (International)
Conference ID: 23775256
A transcript will be available on the Authority’s 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 Tribe’s 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 Tribe’s gaming operation at Mohegan Sun is one of only three legally authorized gaming operations in southern 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.
7
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 Authority’s financial results is included in its Annual Report on Form 10-K for the fiscal year ended September 30, 2012, as well as in the Authority’s 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.
8
MOHEGAN TRIBAL GAMING AUTHORITY
CONSOLIDATED STATEMENTS OF INCOME
(in thousands)
(unaudited)
| For the Three Months Ended June 30, 2013 |
For the Three Months Ended June 30, 2012 |
For the Nine Months Ended June 30, 2013 |
For the Nine Months Ended June 30, 2012 |
|||||||||||||
| Revenues: |
||||||||||||||||
| Gaming |
$ | 304,582 | $ | 307,093 | $ | 885,602 | $ | 940,753 | ||||||||
| Food and beverage |
22,400 | 22,700 | 63,404 | 68,627 | ||||||||||||
| Hotel |
10,318 | 10,152 | 30,363 | 29,524 | ||||||||||||
| Retail, entertainment and other |
32,346 | 29,946 | 84,521 | 82,458 | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| Gross revenues |
369,646 | 369,891 | 1,063,890 | 1,121,362 | ||||||||||||
| Less - Promotional allowances |
(25,401 | ) | (25,455 | ) | (69,195 | ) | (73,896 | ) | ||||||||
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|
|
|
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|
|
|
|
|||||||||
| Net revenues |
344,245 | 344,436 | 994,695 | 1,047,466 | ||||||||||||
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|
|
|
|
|
|
|
|||||||||
| Operating costs and expenses: |
||||||||||||||||
| Gaming |
179,537 | 193,019 | 525,409 | 582,017 | ||||||||||||
| Food and beverage |
10,231 | 11,240 | 31,035 | 33,355 | ||||||||||||
| Hotel |
3,743 | 3,658 | 10,674 | 10,703 | ||||||||||||
| Retail, entertainment and other |
11,858 | 10,578 | 31,314 | 29,819 | ||||||||||||
| Advertising, general and administrative |
48,038 | 48,730 | 143,271 | 147,186 | ||||||||||||
| Corporate |
5,933 | 4,651 | 19,624 | 12,653 | ||||||||||||
| Depreciation and amortization |
20,350 | 21,693 | 60,465 | 64,077 | ||||||||||||
| Loss on disposition of assets |
144 | 31 | 277 | 320 | ||||||||||||
| Severance |
51 | — | 29 | — | ||||||||||||
| Pre-opening |
173 | — | 245 | — | ||||||||||||
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|
|
|
|
|
|
|
|||||||||
| Total operating costs and expenses |
280,058 | 293,600 | 822,343 | 880,130 | ||||||||||||
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|
|
|
|||||||||
| Income from operations |
64,187 | 50,836 | 172,352 | 167,336 | ||||||||||||
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|
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|
|||||||||
| Other income (expense): |
||||||||||||||||
| Accretion of discount to the relinquishment liability |
(1,243 | ) | (2,062 | ) | (3,730 | ) | (6,186 | ) | ||||||||
| Interest income |
1,533 | 1,842 | 4,421 | 3,559 | ||||||||||||
| Interest expense, net of capitalized interest |
(42,379 | ) | (41,581 | ) | (128,213 | ) | (103,047 | ) | ||||||||
| Loss on early exchange of debt |
— | (17 | ) | (403 | ) | (14,323 | ) | |||||||||
| Other income (expense), net |
53 | 7 | (1,732 | ) | (31 | ) | ||||||||||
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|
|
|
|
|
|
|
|
|||||||||
| Total other expense |
(42,036 | ) | (41,811 | ) | (129,657 | ) | (120,028 | ) | ||||||||
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|
|
|
|
|
|
|
|||||||||
| Net income |
22,151 | 9,025 | 42,695 | 47,308 | ||||||||||||
| Loss attributable to non-controlling interests |
146 | 336 | 2,767 | 1,147 | ||||||||||||
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|
|
|
|
|||||||||
| Net income attributable to Mohegan Tribal Gaming Authority |
$ | 22,297 | $ | 9,361 | $ | 45,462 | $ | 48,455 | ||||||||
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9
MOHEGAN TRIBAL GAMING AUTHORITY
CONSOLIDATED SELECTED FINANCIAL INFORMATION
(in thousands)
(unaudited)
| For the Three Months Ended | For the Nine Months Ended | |||||||||||||||
| June 30, 2013 |
June 30, 2012 |
June 30, 2013 |
June 30, 2012 |
|||||||||||||
| Operating Results: |
||||||||||||||||
| Gross revenues |
$ | 369,646 | $ | 369,891 | $ | 1,063,890 | $ | 1,121,362 | ||||||||
| Net revenues |
$ | 344,245 | $ | 344,436 | $ | 994,695 | $ | 1,047,466 | ||||||||
| Income from operations |
$ | 64,187 | $ | 50,836 | $ | 172,352 | $ | 167,336 | ||||||||
| Other Data: |
||||||||||||||||
| Adjusted EBITDA |
$ | 85,051 | $ | 72,896 | $ | 236,135 | $ | 232,880 | ||||||||
| Capital expenditures |
$ | 18,619 | $ | 8,707 | $ | 43,221 | $ | 34,131 | ||||||||
| Cash interest paid |
$ | 45,997 | $ | 8,609 | $ | 140,281 | $ | 78,119 | ||||||||
| Net cash flows provided by operating activities |
$ | 24,621 | $ | 58,073 | $ | 85,609 | $ | 144,291 | ||||||||
| Net cash flows used in investing activities |
$ | 6,617 | $ | 8,970 | $ | 23,862 | $ | 38,700 | ||||||||
| Net cash flows used in financing activities |
$ | 24,803 | $ | 87,100 | $ | 95,540 | $ | 97,235 | ||||||||
| June 30, 2013 |
September 30, 2012 |
|||||||||||||||
| Balance Sheet Data: |
||||||||||||||||
| Cash and cash equivalents |
$ | 80,291 | $ | 114,084 | ||||||||||||
| Relinquishment liability |
$ | 92,634 | $ | 120,782 | ||||||||||||
| Capital leases |
$ | 5,987 | $ | 8,825 | ||||||||||||
| Long-term debt, including current portion |
$ | 1,680,735 | $ | 1,697,801 | ||||||||||||
MOHEGAN SUN
SUPPLEMENTAL DATA
(unaudited)
| For the Three Months Ended | For the Nine Months Ended | |||||||||||||||
| June 30, 2013 |
June 30, 2012 |
June 30, 2013 |
June 30, 2012 |
|||||||||||||
| Operating results: |
||||||||||||||||
| Gross revenues (in thousands) |
$ | 287,435 | $ | 286,281 | $ | 829,068 | $ | 873,725 | ||||||||
| Net revenues (in thousands) |
$ | 266,699 | $ | 264,876 | $ | 772,571 | $ | 811,838 | ||||||||
| Income from operations (in thousands) |
$ | 57,396 | $ | 44,801 | $ | 158,654 | $ | 148,424 | ||||||||
| Operating margin |
21.5 | % | 16.9 | % | 20.5 | % | 18.3 | % | ||||||||
| Adjusted EBITDA: |
||||||||||||||||
| Adjusted EBITDA (in thousands) |
$ | 74,790 | $ | 62,525 | $ | 210,147 | $ | 200,726 | ||||||||
| Adjusted EBITDA margin |
28.0 | % | 23.6 | % | 27.2 | % | 24.7 | % | ||||||||
| Capital expenditures (in thousands) |
$ | 8,255 | $ | 7,054 | $ | 16,821 | $ | 29,967 | ||||||||
| Weighted average number of units: |
||||||||||||||||
| Slot machines |
5,530 | 5,953 | 5,560 | 6,085 | ||||||||||||
| Table games |
284 | 314 | 286 | 314 | ||||||||||||
| Poker tables |
42 | 42 | 42 | 42 | ||||||||||||
| Win per unit per day: |
||||||||||||||||
| Slot machines (gross) |
$ | 314 | $ | 305 | $ | 302 | $ | 302 | ||||||||
| Table games |
$ | 2,944 | $ | 2,421 | $ | 2,893 | $ | 2,560 | ||||||||
| Poker tables |
$ | 606 | $ | 687 | $ | 651 | $ | 756 | ||||||||
| Hold percentage: |
||||||||||||||||
| Slot machines (gross) |
8.2 | % | 8.2 | % | 8.3 | % | 8.3 | % | ||||||||
| Table games |
16.3 | % | 14.7 | % | 16.5 | % | 15.2 | % | ||||||||
| Food and beverage statistics: |
||||||||||||||||
| Meals served (in thousands) |
708 | 809 | 2,047 | 2,413 | ||||||||||||
| Average price per meal served |
$ | 16.38 | $ | 16.08 | $ | 16.26 | $ | 16.37 | ||||||||
| Hotel statistics: |
||||||||||||||||
| Rooms occupied (in thousands) |
104 | 103 | 310 | 308 | ||||||||||||
| Occupancy rate |
96.7 | % | 96.3 | % | 96.5 | % | 95.8 | % | ||||||||
| Average daily room rate |
$ | 95 | $ | 93 | $ | 94 | $ | 91 | ||||||||
| Revenue per available room |
$ | 92 | $ | 89 | $ | 90 | $ | 87 | ||||||||
| Entertainment statistics: |
||||||||||||||||
| Arena events (in events) |
26 | 38 | 71 | 91 | ||||||||||||
| Arena tickets (in thousands) |
174 | 229 | 451 | 529 | ||||||||||||
| Average price per Arena ticket |
$ | 61.45 | $ | 42.23 | $ | 56.20 | $ | 45.12 | ||||||||
10
MOHEGAN SUN AT POCONO DOWNS
SUPPLEMENTAL DATA
(unaudited)
| For the Three Months Ended | For the Nine Months Ended | |||||||||||||||
| June 30, 2013 |
June 30, 2012 |
June 30, 2013 |
June 30, 2012 |
|||||||||||||
| Operating results: |
||||||||||||||||
| Gross revenues (in thousands) |
$ | 81,878 | $ | 83,610 | $ | 233,794 | $ | 247,637 | ||||||||
| Net revenues (in thousands) |
$ | 77,228 | $ | 79,560 | $ | 221,155 | $ | 235,628 | ||||||||
| Income from operations (in thousands) |
$ | 12,435 | $ | 10,716 | $ | 32,441 | $ | 31,660 | ||||||||
| Operating margin |
16.1 | % | 13.5 | % | 14.7 | % | 13.4 | % | ||||||||
| Adjusted EBITDA: |
||||||||||||||||
| Adjusted EBITDA (in thousands) |
$ | 15,730 | $ | 14,686 | $ | 41,876 | $ | 43,660 | ||||||||
| Adjusted EBITDA margin |
20.4 | % | 18.5 | % | 18.9 | % | 18.5 | % | ||||||||
| Capital expenditures (in thousands) |
$ | 714 | $ | 1,047 | $ | 3,260 | $ | 3,558 | ||||||||
| Weighted average number of units: |
||||||||||||||||
| Slot machines |
2,332 | 2,332 | 2,332 | 2,332 | ||||||||||||
| Table games |
66 | 66 | 66 | 66 | ||||||||||||
| Poker tables |
18 | 18 | 18 | 18 | ||||||||||||
| Win per unit per day: |
||||||||||||||||
| Slot machines (gross) |
$ | 267 | $ | 281 | $ | 259 | $ | 280 | ||||||||
| Table games |
$ | 1,673 | $ | 1,540 | $ | 1,601 | $ | 1,615 | ||||||||
| Poker tables |
$ | 549 | $ | 531 | $ | 631 | $ | 586 | ||||||||
| Hold percentage: |
||||||||||||||||
| Slot machines (gross) |
7.3 | % | 8.0 | % | 7.6 | % | 8.0 | % | ||||||||
| Table games |
19.5 | % | 18.2 | % | 20.0 | % | 18.1 | % | ||||||||
| Food and beverage statistics: |
||||||||||||||||
| Meals served (in thousands) |
209 | 186 | 534 | 546 | ||||||||||||
| Average price per meal served |
$ | 15.84 | $ | 15.98 | $ | 16.49 | $ | 15.67 | ||||||||
CORPORATE
SUPPLEMENTAL DATA
(unaudited)
| For the Three Months Ended | For the Nine Months Ended | |||||||||||||||
| June 30, 2013 |
June 30, 2012 |
June 30, 2013 |
June 30, 2012 |
|||||||||||||
| Capital expenditures (in thousands) |
$ | 9,650 | $ | 606 | $ | 23,140 | $ | 606 | ||||||||
| Capitalized interest (in thousands) |
$ | 584 | $ | — | $ | 1,067 | $ | — | ||||||||
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, 2013 |
June 30, 2012 |
June 30, 2013 |
June 30, 2012 |
|||||||||||||
| Adjusted EBITDA |
$ | 85,051 | $ | 72,896 | $ | 236,135 | $ | 232,880 | ||||||||
| Depreciation and amortization |
(20,350 | ) | (21,693 | ) | (60,465 | ) | (64,077 | ) | ||||||||
| Loss on disposition of assets |
(144 | ) | (31 | ) | (277 | ) | (320 | ) | ||||||||
| Severance |
(51 | ) | — | (29 | ) | — | ||||||||||
| Pre-opening |
(173 | ) | — | (245 | ) | — | ||||||||||
| Loss attributable to non-controlling interests |
(146 | ) | (336 | ) | (2,767 | ) | (1,147 | ) | ||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| Income from operations |
64,187 | 50,836 | 172,352 | 167,336 | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| Accretion of discount to the relinquishment liability |
(1,243 | ) | (2,062 | ) | (3,730 | ) | (6,186 | ) | ||||||||
| Interest income |
1,533 | 1,842 | 4,421 | 3,559 | ||||||||||||
| Interest expense, net of capitalized interest |
(42,379 | ) | (41,581 | ) | (128,213 | ) | (103,047 | ) | ||||||||
| Loss on early exchange of debt |
— | (17 | ) | (403 | ) | (14,323 | ) | |||||||||
| Other income (expense), net |
53 | 7 | (1,732 | ) | (31 | ) | ||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| Net income |
$ | 22,151 | $ | 9,025 | $ | 42,695 | $ | 47,308 | ||||||||
|
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|
|
|
|
|
|
|
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11
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, 2013 | ||||||||||||||||||||||||||||
| Income (Loss) from Operations |
Depreciation and Amortization |
Loss on Disposition of Assets |
Severance | Pre-opening | Loss attributable to Non-controlling Interests |
Adjusted EBITDA |
||||||||||||||||||||||
| Mohegan Sun |
$ | 57,396 | $ | 17,268 | $ | 126 | $ | — | $ | — | $ | — | $ | 74,790 | ||||||||||||||
| Mohegan Sun at Pocono Downs |
12,435 | 3,053 | 18 | 51 | 173 | — | 15,730 | |||||||||||||||||||||
| Corporate |
(5,644 | ) | 29 | — | — | — | 146 | (5,469 | ) | |||||||||||||||||||
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|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
| Total |
$ | 64,187 | $ | 20,350 | $ | 144 | $ | 51 | $ | 173 | $ | 146 | $ | 85,051 | ||||||||||||||
|
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|
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|
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|
|
|||||||||||||||
| For the Three Months Ended June 30, 2012 | ||||||||||||||||||||||||||||
| Income (Loss) from Operations |
Depreciation and Amortization |
Loss on Disposition of Assets |
Severance | Pre-opening | Loss attributable to Non-controlling Interests |
Adjusted EBITDA |
||||||||||||||||||||||
| 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 | ) | |||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
| Total |
$ | 50,836 | $ | 21,693 | $ | 31 | $ | — | $ | — | $ | 336 | $ | 72,896 | ||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
| For the Nine Months Ended June 30, 2013 | ||||||||||||||||||||||||||||
| Income (Loss) from Operations |
Depreciation and Amortization |
Loss on Disposition of Assets |
Severance | Pre-opening | Loss attributable to Non-controlling Interests |
Adjusted EBITDA |
||||||||||||||||||||||
| Mohegan Sun |
$ | 158,654 | $ | 51,380 | $ | 259 | $ | (146 | ) | $ | — | $ | — | $ | 210,147 | |||||||||||||
| Mohegan Sun at Pocono Downs |
32,441 | 8,997 | 18 | 175 | 245 | — | 41,876 | |||||||||||||||||||||
| Corporate |
(18,743 | ) | 88 | — | — | — | 2,767 | (15,888 | ) | |||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
| Total |
$ | 172,352 | $ | 60,465 | $ | 277 | $ | 29 | $ | 245 | $ | 2,767 | $ | 236,135 | ||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
| For the Nine Months Ended June 30, 2012 | ||||||||||||||||||||||||||||
| Income (Loss) from Operations |
Depreciation and Amortization |
Loss on Disposition of Assets |
Severance | Pre-opening | Loss attributable to Non-controlling Interests |
Adjusted EBITDA |
||||||||||||||||||||||
| 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 | ) | |||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
| Total |
$ | 167,336 | $ | 64,077 | $ | 320 | $ | — | $ | — | $ | 1,147 | $ | 232,880 | ||||||||||||||
|
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|
|
|
|
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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, pre-opening costs and expenses, accretion of discount to a relinquishment liability, other non-operating income and expense and loss attributable to non-controlling interests.
Adjusted EBITDA provides an additional way to evaluate the Authority’s operations and, when viewed with both the Authority’s 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 Authority’s 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 Authority’s 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
12
of the Authority’s performance) or cash flows provided by operating activities (as an indicator of the Authority’s liquidity), nor should it be considered as an indicator of the Authority’s overall financial performance. The Authority’s 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 Authority’s 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.
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
13