(Mark One) | |
þ | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the quarterly period ended September 30, 2016 | |
or | |
o | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the transition period from to |
Delaware (State or other jurisdiction of incorporation or organization) | 13-3391527 (I.R.S. Employer Identification No.) | |
4670 S. Fort Apache Road, Ste. 190 Las Vegas, Nevada (Address of principal executive offices) | 89147 (Zip Code) |
Large Accelerated Filer o | Accelerated Filer o |
Non Accelerated Filer o (Do not check if a smaller reporting company) | Smaller reporting company þ |
Page | |||
PART I. Financial Information | |||
Item 1. | |||
Item 2. | |||
Item 3. | |||
Item 4. | |||
PART II. Other Information | |||
Item 1. | |||
Item 1A. | |||
Item 6. | |||
FULL HOUSE RESORTS, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) (In thousands, except per share data) | |||||||||||||||
Three months ended September 30, | Nine months ended September 30, | ||||||||||||||
2016 | 2015 | 2016 | 2015 | ||||||||||||
Revenues | |||||||||||||||
Casino | $ | 37,460 | $ | 30,577 | $ | 97,897 | $ | 84,374 | |||||||
Food and beverage | 8,282 | 6,891 | 21,438 | 19,053 | |||||||||||
Hotel | 2,361 | 2,020 | 6,488 | 4,836 | |||||||||||
Other operations | 1,253 | 1,208 | 3,096 | 2,890 | |||||||||||
Gross revenues | 49,356 | 40,696 | 128,919 | 111,153 | |||||||||||
Less promotional allowances | (7,600 | ) | (6,430 | ) | (20,309 | ) | (17,077 | ) | |||||||
Net revenues | 41,756 | 34,266 | 108,610 | 94,076 | |||||||||||
Operating costs and expenses | |||||||||||||||
Casino | 19,814 | 15,600 | 50,574 | 43,569 | |||||||||||
Food and beverage | 2,817 | 2,282 | 7,090 | 6,632 | |||||||||||
Hotel | 297 | 248 | 768 | 678 | |||||||||||
Other operations | 475 | 372 | 1,236 | 1,023 | |||||||||||
Selling, general and administrative | 12,808 | 9,570 | 36,650 | 30,763 | |||||||||||
Project development and acquisition costs | 130 | 730 | 902 | 894 | |||||||||||
Depreciation and amortization | 2,203 | 2,203 | 5,795 | 6,225 | |||||||||||
Loss on disposal of assets, net | 309 | — | 309 | — | |||||||||||
38,853 | 31,005 | 103,324 | 89,784 | ||||||||||||
Operating income | 2,903 | 3,261 | 5,286 | 4,292 | |||||||||||
Other (expense) income | |||||||||||||||
Interest expense, net of amounts capitalized | (2,748 | ) | (1,829 | ) | (6,740 | ) | (4,876 | ) | |||||||
Debt modification costs | (24 | ) | — | (624 | ) | — | |||||||||
Adjustment to fair value of warrants and other | 181 | — | (60 | ) | 12 | ||||||||||
(2,591 | ) | (1,829 | ) | (7,424 | ) | (4,864 | ) | ||||||||
Income (loss) before income taxes | 312 | 1,432 | (2,138 | ) | (572 | ) | |||||||||
Provision (benefit) for income taxes | 177 | (603 | ) | 458 | (425 | ) | |||||||||
Net income (loss) | $ | 135 | $ | 2,035 | $ | (2,596 | ) | $ | (147 | ) | |||||
Basic income (loss) per share | $ | 0.01 | $ | 0.11 | $ | (0.14 | ) | $ | (0.01 | ) | |||||
Diluted income (loss) per share | $ | — | $ | 0.11 | $ | (0.14 | ) | $ | (0.01 | ) |
FULL HOUSE RESORTS, INC. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS (In thousands, except share data) | |||||||
September 30, 2016 | December 31, 2015 | ||||||
(Unaudited) | |||||||
ASSETS | |||||||
Current assets | |||||||
Cash and equivalents | $ | 23,082 | $ | 14,574 | |||
Restricted cash | — | 569 | |||||
Accounts receivable, net of collection allowance of $83 and $121 | 1,557 | 1,714 | |||||
Inventories | 1,447 | 1,125 | |||||
Prepaid expenses | 3,952 | 2,800 | |||||
Acquisition deposit | — | 2,500 | |||||
30,038 | 23,282 | ||||||
Property and equipment, net | 111,229 | 98,982 | |||||
Other long-term assets | |||||||
Goodwill | 21,279 | 16,480 | |||||
Intangible assets, net of accumulated amortization of $7,725 and $7,701 | 11,145 | 2,127 | |||||
Deposits and other | 547 | 541 | |||||
Deferred taxes | 55 | 55 | |||||
33,026 | 19,203 | ||||||
$ | 174,293 | $ | 141,467 | ||||
LIABILITIES AND STOCKHOLDERS’ EQUITY | |||||||
Current liabilities | |||||||
Accounts payable | $ | 3,888 | $ | 4,272 | |||
Accrued payroll and other | 11,635 | 6,529 | |||||
Deferred taxes | 979 | 981 | |||||
Current portion of long-term debt | 1,688 | 6,000 | |||||
Current portion of capital lease obligation | 400 | 665 | |||||
18,590 | 18,447 | ||||||
Warrant liability | 634 | — | |||||
Deferred taxes | 811 | 350 | |||||
Long-term debt, net of current portion | 94,584 | 60,642 | |||||
Capital lease obligation, net of current portion | 5,432 | 5,505 | |||||
120,051 | 84,944 | ||||||
Commitments and contingencies (Notes 7 and 9) | |||||||
Stockholders’ equity | |||||||
Common stock, $0.0001 par value, 100,000,000 shares authorized; 20,375,404 and 20,325,991 issued; and 19,018,809 and 18,969,396 shares outstanding | 2 | 2 | |||||
Additional paid-in capital | 46,536 | 46,221 | |||||
Treasury stock, 1,356,595 common shares | (1,654 | ) | (1,654 | ) | |||
Retained earnings | 9,358 | 11,954 | |||||
54,242 | 56,523 | ||||||
$ | 174,293 | $ | 141,467 |
FULL HOUSE RESORTS, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENT OF STOCKHOLDERS’ EQUITY (Unaudited) (In thousands) | ||||||||||||||||||||||||||
Common stock | Treasury stock | |||||||||||||||||||||||||
Shares | Dollars | Additional Paid-in Capital | Shares | Dollars | Retained Earnings | Total Stockholders' Equity | ||||||||||||||||||||
Balance, January 1, 2016 | 20,326 | $ | 2 | $ | 46,221 | 1,357 | $ | (1,654 | ) | $ | 11,954 | $ | 56,523 | |||||||||||||
Stock-based compensation | 49 | — | 315 | — | — | — | 315 | |||||||||||||||||||
Net loss | — | — | — | — | — | (2,596 | ) | (2,596 | ) | |||||||||||||||||
Balance, September 30, 2016 | 20,375 | $ | 2 | $ | 46,536 | 1,357 | $ | (1,654 | ) | $ | 9,358 | $ | 54,242 |
FULL HOUSE RESORTS, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) (In thousands) | |||||||
Nine Months Ended September 30, | |||||||
2016 | 2015 | ||||||
Cash flows from operating activities: | |||||||
Net loss | $ | (2,596 | ) | $ | (147 | ) | |
Adjustments to reconcile net loss to net cash provided by operating activities: | |||||||
Depreciation | 5,771 | 4,727 | |||||
Amortization of debt issuance costs and other | 864 | 1,218 | |||||
Amortization of player loyalty program, land lease and water rights | 24 | 1,498 | |||||
Tribal advance collection allowance reduction | — | (250 | ) | ||||
Loss on disposal of assets | 354 | — | |||||
Stock-based compensation | 315 | 285 | |||||
Change in fair value of stock warrants | 60 | — | |||||
Increases and decreases in operating assets and liabilities: | |||||||
Accounts receivable, net | (93 | ) | (1,267 | ) | |||
Income tax receivable | — | 2,336 | |||||
Prepaid expenses, inventories and other | (1,267 | ) | (1,449 | ) | |||
Deferred taxes | 459 | 268 | |||||
Accounts payable and accrued expenses | 2,425 | (1,624 | ) | ||||
Net cash provided by operating activities | 6,316 | 5,595 | |||||
Cash flows from investing activities: | |||||||
Acquisition of Bronco Billy's, net of cash acquired | (28,369 | ) | — | ||||
Purchase of property and equipment | (1,736 | ) | (10,021 | ) | |||
Restricted cash | 569 | (569 | ) | ||||
Refunded deposits and other, net | 2,861 | (3,177 | ) | ||||
Net cash used in investing activities | (26,675 | ) | (13,767 | ) | |||
Cash flows from financing activities: | |||||||
First Term Loan (repayments) borrowings | (2,125 | ) | 8,869 | ||||
Revolving Loan repayments | (2,000 | ) | (1,500 | ) | |||
Second Term Loan borrowings | 35,000 | — | |||||
Repayment of capital lease obligation | (338 | ) | (573 | ) | |||
Debt issuance costs and other | (1,670 | ) | (325 | ) | |||
Net cash provided by financing activities | 28,867 | 6,471 | |||||
Net increase (decrease) in cash and equivalents | 8,508 | (1,701 | ) | ||||
Cash and equivalents, beginning of period | 14,574 | 15,639 | |||||
Cash and equivalents, end of period | $ | 23,082 | $ | 13,938 | |||
SUPPLEMENTAL CASH FLOW INFORMATION: | |||||||
Cash paid for interest, net of amounts capitalized | $ | 5,738 | $ | 3,439 | |||
Cash (received) paid for income taxes | $ | — | $ | (3,154 | ) | ||
NON-CASH INVESTING AND FINANCING ACTIVITIES: | |||||||
Accounts payable related capital expenditures | $ | 730 | $ | 1,438 | |||
Issuance of stock warrants | $ | 574 | $ | — |
Property | Acquisition Date | Location | ||
Silver Slipper Casino and Hotel | 2012 | Hancock County, MS (near New Orleans) | ||
Bronco Billy's Hotel and Casino | 2016 | Cripple Creek, CO (near Colorado Springs) | ||
Rising Star Casino Resort | 2011 | Rising Sun, IN (near Cincinnati) | ||
Stockman’s Casino | 2007 | Fallon, NV (one hour east of Reno) | ||
Grand Lodge Casino (leased and part of the Hyatt Regency Lake Tahoe Resort) | 2011 | Incline Village, NV (North Shore of Lake Tahoe) |
(In thousands, unaudited) | ||||
Cash and equivalents | $ | 2,682 | ||
Other current assets | 258 | |||
Property and equipment | 16,694 | |||
Goodwill | 4,799 | |||
Gaming licenses | 7,000 | |||
Trade names | 1,800 | |||
Total assets | 33,233 | |||
Current liabilities | 2,182 | |||
Total liabilities | 2,182 | |||
Estimated net assets acquired | $ | 31,051 |
Pro Forma Consolidated Statement of Operations | |||||||||||||||
(In thousands, unaudited) | |||||||||||||||
For the three months ended | For the nine months ended | ||||||||||||||
September 30, 2016 | September 30, 2015 | September 30, 2016 | September 30, 2015 | ||||||||||||
Net revenues | $ | 41,756 | $ | 41,889 | $ | 117,822 | $ | 114,063 | |||||||
Net income (loss) | 208 | 3,144 | (3,213 | ) | (949 | ) | |||||||||
Basic income (loss) per share | 0.01 | 0.17 | (0.17 | ) | (0.05 | ) | |||||||||
Diluted income (loss) per share | — | 0.17 | (0.17 | ) | (0.05 | ) |
(In thousands) | September 30, 2016 | December 31, 2015 | |||||
(Unaudited) | |||||||
Land and improvements | $ | 13,699 | $ | 12,657 | |||
Buildings and improvements | 102,365 | 90,636 | |||||
Furniture and equipment | 36,348 | 31,899 | |||||
Construction in progress | 448 | 13 | |||||
152,860 | 135,205 | ||||||
Less accumulated depreciation and amortization | (41,631 | ) | (36,223 | ) | |||
$ | 111,229 | $ | 98,982 |
(In thousands) | September 30, 2016 | ||||||||||||||
(unaudited) | |||||||||||||||
Outstanding Principal | Unamortized Discount | Unamortized Debt Issuance Costs | Long-term Debt, Net | ||||||||||||
First Term Loan | $ | 43,875 | $ | — | $ | (625 | ) | $ | 43,250 | ||||||
Revolving Loan | — | — | — | — | |||||||||||
Second Term Loan | 55,000 | (510 | ) | (1,468 | ) | 53,022 | |||||||||
Total debt including current maturities | 98,875 | (510 | ) | (2,093 | ) | 96,272 | |||||||||
Less current portion | (1,688 | ) | — | — | (1,688 | ) | |||||||||
Total long-term debt, net | $ | 97,187 | $ | (510 | ) | $ | (2,093 | ) | $ | 94,584 |
(In thousands) | December 31, 2015 | ||||||||||
Outstanding Principal | Unamortized Debt Issuance Costs | Long-term Debt, Net | |||||||||
First Term Loan | $ | 46,000 | $ | (777 | ) | $ | 45,223 | ||||
Revolving Loan | 2,000 | — | 2,000 | ||||||||
Second Term Loan | 20,000 | (581 | ) | 19,419 | |||||||
Total debt including current maturities | 68,000 | (1,358 | ) | 66,642 | |||||||
Less current portion | (6,000 | ) | — | (6,000 | ) | ||||||
Total long-term debt, net | $ | 62,000 | $ | (1,358 | ) | $ | 60,642 |
First Lien Credit Facility | |||||
Applicable Period | Maximum Total Leverage Ratio | Maximum First Lien Leverage Ratio | |||
April 1, 2016 through and including March 30, 2017 | 5.875x | 2.750x | |||
March 31, 2017 through and including September 29, 2017 | 5.875x | 2.625x | |||
September 30, 2017 through and including March 30, 2018 | 5.750x | 2.500x | |||
March 31, 2018 through and including September 29, 2018 | 5.625x | 2.375x | |||
September 30, 2018 through and including March 30, 2019 | 5.375x | 2.250x | |||
March 31, 2019 and thereafter | 5.250x | 2.125x |
Second Lien Credit Facility | |||||
Applicable Period | Maximum Total Leverage Ratio | Maximum First Lien Leverage Ratio | |||
April 1, 2016 through and including March 30, 2017 | 6.125x | 3.000x | |||
March 31, 2017 through and including September 29, 2017 | 6.125x | 2.875x | |||
September 30, 2017 through and including March 30, 2018 | 6.000x | 2.750x | |||
March 31, 2018 through and including September 29, 2018 | 5.875x | 2.625x | |||
September 30, 2018 through and including March 30, 2019 | 5.625x | 2.500x | |||
March 31, 2019 through and including September 29, 2019 | 5.500x | 2.375x | |||
September 30, 2019 and thereafter | 5.250x | 2.250x |
(In thousands) | Three Months Ended | Nine Months Ended | |||||||||||||
September 30, 2016 | September 30, 2015 | September 30, 2016 | September 30, 2015 | ||||||||||||
Numerator: | |||||||||||||||
Net income (loss) attributable to Full House Resorts, Inc. - basic | $ | 135 | $ | 2,035 | $ | (2,596 | ) | $ | (147 | ) | |||||
Change in fair value of warrants | (181 | ) | — | — | — | ||||||||||
Net loss attributable to Full House Resorts, Inc. - diluted | $ | (46 | ) | $ | 2,035 | $ | (2,596 | ) | $ | (147 | ) | ||||
Denominator: | |||||||||||||||
Weighted-average common share equivalents - basic | 19,019 | 18,969 | 18,995 | 18,927 | |||||||||||
Potential dilution from share-based awards | 195 | — | — | — | |||||||||||
Potential dilution from assumed conversion of warrants | 112 | — | — | — | |||||||||||
Weighted-average common and common share equivalents - diluted | 19,326 | 18,969 | 18,995 | 18,927 |
Number of Stock Options | Weighted Average Exercise Price | |||||
Options outstanding at January 1, 2016 | 1,563,834 | $ | 1.33 | |||
Granted | 494,116 | 1.70 | ||||
Exercised | — | n/a | ||||
Canceled/Forfeited | — | n/a | ||||
Options outstanding at September 30, 2016 | 2,057,950 | $ | 1.42 | |||
Options exercisable at September 30, 2016 | 664,255 | $ | 1.31 |
For the three months ended September 30, 2016 | |||||||||||||||||||||||
(In thousands, unaudited) | |||||||||||||||||||||||
Casino/Resort Operations | |||||||||||||||||||||||
Silver Slipper Casino & Hotel | Rising Star Casino Resort | Bronco Billy's Casino & Hotel | Northern Nevada | Corporate | Consolidated | ||||||||||||||||||
Revenues, net | $ | 14,987 | $ | 12,553 | $ | 7,565 | $ | 6,651 | $ | — | $ | 41,756 | |||||||||||
Adjusted Property EBITDA | $ | 2,304 | $ | 751 | $ | 1,610 | $ | 1,864 | $ | — | $ | 6,529 | |||||||||||
Other operating costs and expenses: | |||||||||||||||||||||||
Depreciation and amortization | 818 | 660 | 504 | 219 | 2 | 2,203 | |||||||||||||||||
Loss on asset disposals, net | 6 | 8 | — | 295 | — | 309 | |||||||||||||||||
Corporate expenses | — | — | — | — | 889 | 889 | |||||||||||||||||
Project development and acquisition costs | — | — | — | — | 130 | 130 | |||||||||||||||||
Stock compensation | — | — | — | — | 95 | 95 | |||||||||||||||||
Operating income (loss) | 1,480 | 83 | 1,106 | 1,350 | (1,116 | ) | 2,903 | ||||||||||||||||
Non-operating expense (income): | |||||||||||||||||||||||
Interest expense | 5 | 51 | — | — | 2,692 | 2,748 | |||||||||||||||||
Debt modification costs | — | — | — | — | 24 | 24 | |||||||||||||||||
Adjustment to fair value of warrants | — | — | — | — | (181 | ) | (181 | ) | |||||||||||||||
Non-operating expense | 5 | 51 | — | — | 2,535 | 2,591 | |||||||||||||||||
Income (loss) before income taxes | 1,475 | 32 | 1,106 | 1,350 | (3,651 | ) | 312 | ||||||||||||||||
Provision (benefit) for income taxes | 85 | (1 | ) | 88 | — | 5 | 177 | ||||||||||||||||
Net income (loss) | $ | 1,390 | $ | 33 | $ | 1,018 | $ | 1,350 | $ | (3,656 | ) | $ | 135 |
For the three months ended September 30, 2015 | |||||||||||||||||||||||
(In thousands, unaudited) | |||||||||||||||||||||||
Casino/Resort Operations | |||||||||||||||||||||||
Silver Slipper Casino & Hotel | Rising Star Casino Resort | Bronco Billy's Hotel & Casino | Northern Nevada | Corporate | Consolidated | ||||||||||||||||||
Revenues, net | $ | 14,894 | $ | 12,563 | $ | — | $ | 6,809 | $ | — | $ | 34,266 | |||||||||||
Adjusted Property EBITDA | $ | 2,413 | $ | 2,455 | $ | — | $ | 2,227 | $ | — | $ | 7,095 | |||||||||||
Other operating costs and expenses: | |||||||||||||||||||||||
Depreciation and amortization | 1,322 | 678 | — | 199 | 4 | 2,203 | |||||||||||||||||
Corporate expenses | — | — | — | — | 844 | 844 | |||||||||||||||||
Project development and acquisition costs | — | — | — | — | 709 | 709 | |||||||||||||||||
Pre-opening | 21 | — | — | — | — | 21 | |||||||||||||||||
Stock compensation | — | — | — | — | 57 | 57 | |||||||||||||||||
Operating income (loss) | 1,070 | 1,777 | — | 2,028 | (1,614 | ) | 3,261 | ||||||||||||||||
Non-operating expense: | |||||||||||||||||||||||
Interest expense, net of amounts capitalized | 4 | 40 | — | — | 1,785 | 1,829 | |||||||||||||||||
Non-operating expense | 4 | 40 | — | — | 1,785 | 1,829 | |||||||||||||||||
Income (loss) before income taxes | 1,066 | 1,737 | — | 2,028 | (3,399 | ) | 1,432 | ||||||||||||||||
Provision (benefit) for income taxes | 3 | (61 | ) | — | — | (545 | ) | (603 | ) | ||||||||||||||
Net income (loss) | $ | 1,063 | $ | 1,798 | $ | — | $ | 2,028 | $ | (2,854 | ) | $ | 2,035 |
For the nine months ended September 30, 2016 | |||||||||||||||||||||||
(In thousands, unaudited) | |||||||||||||||||||||||
Casino/Resort Operations | |||||||||||||||||||||||
Silver Slipper Casino & Hotel | Rising Star Casino Resort | Bronco Billy's Hotel & Casino | Northern Nevada | Corporate | Consolidated | ||||||||||||||||||
Revenues, net | $ | 44,326 | $ | 36,851 | $ | 11,149 | $ | 16,284 | $ | — | $ | 108,610 | |||||||||||
Adjusted Property EBITDA | $ | 7,335 | $ | 2,483 | $ | 2,698 | $ | 3,256 | $ | — | $ | 15,772 | |||||||||||
Other operating costs and expenses: | |||||||||||||||||||||||
Depreciation and amortization | 2,482 | 1,993 | 723 | 589 | 8 | 5,795 | |||||||||||||||||
Loss on asset disposals, net | 6 | 8 | — | 295 | — | 309 | |||||||||||||||||
Corporate expenses | — | — | — | — | 3,165 | 3,165 | |||||||||||||||||
Project development and acquisition costs | — | — | — | — | 902 | 902 | |||||||||||||||||
Stock compensation | — | — | — | — | 315 | 315 | |||||||||||||||||
Operating income (loss) | 4,847 | 482 | 1,975 | 2,372 | (4,390 | ) | 5,286 | ||||||||||||||||
Non-operating expense (income): | |||||||||||||||||||||||
Interest expense | 13 | 157 | — | — | 6,570 | 6,740 | |||||||||||||||||
Debt modification costs | — | — | — | — | 624 | 624 | |||||||||||||||||
Adjustment to fair value of warrants | — | — | — | — | 60 | 60 | |||||||||||||||||
Non-operating expense | 13 | 157 | — | — | 7,254 | 7,424 | |||||||||||||||||
Income (loss) before income taxes | 4,834 | 325 | 1,975 | 2,372 | (11,644 | ) | (2,138 | ) | |||||||||||||||
Provision for income taxes | 326 | 1 | 119 | 1 | 11 | 458 | |||||||||||||||||
Net income (loss) | $ | 4,508 | $ | 324 | $ | 1,856 | $ | 2,371 | $ | (11,655 | ) | $ | (2,596 | ) |
For the nine months ended September 30, 2015 | |||||||||||||||||||||||
(In thousands, unaudited) | |||||||||||||||||||||||
Casino/Resort Operations | |||||||||||||||||||||||
Silver Slipper Casino & Hotel | Rising Star Casino Resort | Bronco Billy's Hotel & Casino | Northern Nevada | Corporate | Consolidated | ||||||||||||||||||
Revenues, net | $ | 42,967 | $ | 35,444 | $ | — | $ | 15,665 | $ | — | $ | 94,076 | |||||||||||
Adjusted Property EBITDA | $ | 7,774 | $ | 3,251 | $ | — | $ | 3,269 | $ | — | $ | 14,294 | |||||||||||
Other operating costs and expenses: | |||||||||||||||||||||||
Depreciation and amortization | 3,582 | 2,039 | — | 593 | 11 | 6,225 | |||||||||||||||||
Other losses (recoveries) | — | — | — | 80 | (446 | ) | (366 | ) | |||||||||||||||
Corporate expenses | — | — | — | — | 2,964 | 2,964 | |||||||||||||||||
Project development and acquisition costs | — | — | — | — | 760 | 760 | |||||||||||||||||
Pre-opening | 134 | — | — | — | — | 134 | |||||||||||||||||
Stock compensation | — | — | — | — | 285 | 285 | |||||||||||||||||
Operating income (loss) | 4,058 | 1,212 | — | 2,596 | (3,574 | ) | 4,292 | ||||||||||||||||
Non-operating expense: | |||||||||||||||||||||||
Interest expense, net of amounts capitalized | 13 | 124 | — | 4,739 | 4,876 | ||||||||||||||||||
Other | — | (11 | ) | — | — | (1 | ) | (12 | ) | ||||||||||||||
Non-operating expense | 13 | 113 | — | — | 4,738 | 4,864 | |||||||||||||||||
Income (loss) before income taxes | 4,045 | 1,099 | — | 2,596 | (8,312 | ) | (572 | ) | |||||||||||||||
Provision (benefit) for income taxes | 8 | (61 | ) | — | — | (372 | ) | (425 | ) | ||||||||||||||
Net income (loss) | $ | 4,037 | $ | 1,160 | $ | — | $ | 2,596 | $ | (7,940 | ) | $ | (147 | ) |
As of September 30, 2016 | |||||||||||||||||||||||
(In thousands, unaudited) | |||||||||||||||||||||||
Casino/Resort Operations | |||||||||||||||||||||||
Silver Slipper Casino & Hotel | Rising Star Casino Resort | Bronco Billy's Hotel & Casino | Northern Nevada | Corporate | Consolidated | ||||||||||||||||||
Total assets | $ | 80,603 | $ | 36,099 | $ | 37,589 | $ | 11,500 | $ | 8,502 | $ | 174,293 | |||||||||||
Property and equipment, net | 59,452 | 29,583 | 16,280 | 5,782 | 132 | 111,229 | |||||||||||||||||
Goodwill | 14,671 | — | 4,799 | 1,809 | — | 21,279 | |||||||||||||||||
Liabilities | 4,157 | 10,363 | 3,459 | 2,480 | 99,592 | 120,051 |
As of December 31, 2015 | |||||||||||||||||||||||
(In thousands) | |||||||||||||||||||||||
Casino/Resort Operations | |||||||||||||||||||||||
Silver Slipper Casino & Hotel | Rising Star Casino Resort | Bronco Billy's Hotel & Casino | Northern Nevada | Corporate | Consolidated | ||||||||||||||||||
Total assets | $ | 82,621 | $ | 37,141 | $ | — | $ | 12,105 | $ | 9,600 | $ | 141,467 | |||||||||||
Property and equipment, net | 61,150 | 31,391 | — | 6,098 | 343 | 98,982 | |||||||||||||||||
Goodwill | 14,671 | — | — | 1,809 | — | 16,480 | |||||||||||||||||
Liabilities | 3,389 | 10,034 | — | 1,834 | 69,687 | 84,944 |
Property | Acquisition Date | Location | ||
Silver Slipper Casino and Hotel | 2012 | Hancock County, MS (near New Orleans) | ||
Bronco Billy Casino and Hotel | 2016 | Cripple Creek, CO (near Colorado Springs) | ||
Rising Star Casino Resort | 2011 | Rising Sun, IN (near Cincinnati) | ||
Stockman’s Casino | 2007 | Fallon, NV (one hour east of Reno) | ||
Grand Lodge Casino (leased and part of the Hyatt Regency Lake Tahoe Resort) | 2011 | Incline Village, NV (North Shore of Lake Tahoe) |
(In thousands) | Three Months Ended September 30, | Percent Change | Nine Months Ended September 30, | Percent Change | |||||||||||||||||
2016 | 2015 | 2016 | 2015 | ||||||||||||||||||
Net revenues | $ | 41,756 | $ | 34,266 | 21.9 | % | $ | 108,610 | $ | 94,076 | 15.4 | % | |||||||||
Operating expenses | 38,853 | 31,005 | 25.3 | % | 103,324 | 89,784 | 15.1 | % | |||||||||||||
Operating income | 2,903 | 3,261 | (11.0 | )% | 5,286 | 4,292 | 23.2 | % | |||||||||||||
Interest and other, net | 2,591 | 1,829 | 41.7 | % | 7,424 | 4,864 | 52.6 | % | |||||||||||||
Income tax expense (benefit) | 177 | (603 | ) | (129.4 | )% | 458 | (425 | ) | (207.8 | )% | |||||||||||
Net income (loss) | $ | 135 | $ | 2,035 | (93.4 | )% | $ | (2,596 | ) | $ | (147 | ) | 1,666.0 | % |
(In thousands) | Three Months Ended September 30, | Percent Change | Nine Months Ended September 30, | Percent Change | |||||||||||||||||
2016 | 2015 | 2016 | 2015 | ||||||||||||||||||
Casino revenues | |||||||||||||||||||||
Slots | $ | 32,886 | $ | 26,358 | 24.8 | % | $ | 84,537 | $ | 72,622 | 16.4 | % | |||||||||
Table games | 4,493 | 4,135 | 8.7 | % | 13,078 | 11,499 | 13.7 | % | |||||||||||||
Other | 82 | 84 | (2.4 | )% | 285 | 253 | 12.6 | % | |||||||||||||
37,461 | 30,577 | 22.5 | % | 97,900 | 84,374 | 16.0 | % | ||||||||||||||
Non-casino revenues, net | |||||||||||||||||||||
Food and beverage | 2,860 | 2,515 | 13.7 | % | 7,235 | 7,041 | 2.8 | % | |||||||||||||
Hotel | 521 | 376 | 38.6 | % | 1,254 | 776 | 61.6 | % | |||||||||||||
Other | 914 | 798 | 14.5 | % | 2,221 | 1,885 | 17.8 | % | |||||||||||||
4,295 | 3,689 | 16.4 | % | 10,710 | 9,702 | 10.4 | % | ||||||||||||||
Total net revenues | $ | 41,756 | $ | 34,266 | 21.9 | % | $ | 108,610 | $ | 94,076 | 15.4 | % |
(In thousands) | Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||
2016 | 2015 | 2016 | 2015 | ||||||||||||
Interest cost (excluding loan fee amortization) | $ | 2,523 | $ | 1,404 | $ | 5,901 | $ | 4,098 | |||||||
Amortization of debt costs | 225 | 408 | 839 | 1,218 | |||||||||||
Capitalized interest | — | 17 | — | (440 | ) | ||||||||||
$ | 2,748 | $ | 1,829 | $ | 6,740 | $ | 4,876 |
(In thousands) | Three Months Ended September 30, | Percent Change | Nine Months Ended September 30, | Percent Change | |||||||||||||||||
2016 | 2015 | 2016 | 2015 | ||||||||||||||||||
Net revenues | |||||||||||||||||||||
Silver Slipper Casino and Hotel | $ | 14,987 | $ | 14,894 | 0.6 | % | $ | 44,326 | $ | 42,967 | 3.2 | % | |||||||||
Rising Star Casino Resort | 12,553 | 12,563 | (0.1 | )% | 36,851 | 35,444 | 4.0 | % | |||||||||||||
Bronco Billy's Casino and Hotel | 7,565 | — | n/a | 11,149 | — | n/a | |||||||||||||||
Northern Nevada Casinos | 6,651 | 6,809 | (2.3 | )% | 16,284 | 15,665 | 4.0 | % | |||||||||||||
$ | 41,756 | $ | 34,266 | 21.9 | % | $ | 108,610 | $ | 94,076 | 15.4 | % | ||||||||||
Adjusted EBITDA | |||||||||||||||||||||
Silver Slipper Casino and Hotel | $ | 2,304 | $ | 2,413 | (4.5 | )% | $ | 7,335 | $ | 7,774 | (5.6 | )% | |||||||||
Rising Star Casino Resort | 751 | 2,455 | (69.4 | )% | 2,483 | 3,251 | (23.6 | )% | |||||||||||||
Bronco Billy's Casino and Hotel | 1,610 | — | n/a | 2,698 | — | n/a | |||||||||||||||
Northern Nevada Casinos | 1,864 | 2,227 | (16.3 | )% | 3,256 | 3,269 | (0.4 | )% | |||||||||||||
Corporate | (889 | ) | (844 | ) | 5.3 | % | (3,165 | ) | (2,964 | ) | 6.8 | % | |||||||||
$ | 5,640 | $ | 6,251 | (9.8 | )% | $ | 12,607 | $ | 11,330 | 11.3 | % |
(In thousands) | Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||
2016 | 2015 | 2016 | 2015 | ||||||||||||
Adjusted EBITDA | $ | 5,640 | $ | 6,251 | $ | 12,607 | $ | 11,330 | |||||||
Depreciation and amortization | (2,203 | ) | (2,203 | ) | (5,795 | ) | (6,225 | ) | |||||||
Write-offs, recoveries and asset disposals, net | (309 | ) | — | (309 | ) | 366 | |||||||||
Preopening | — | (21 | ) | — | (134 | ) | |||||||||
Project development and acquisition costs | (130 | ) | (709 | ) | (902 | ) | (760 | ) | |||||||
Stock compensation | (95 | ) | (57 | ) | (315 | ) | (285 | ) | |||||||
Operating income | 2,903 | 3,261 | 5,286 | 4,292 | |||||||||||
Non-operating (expense) income | |||||||||||||||
Interest expense | (2,748 | ) | (1,829 | ) | (6,740 | ) | (4,876 | ) | |||||||
Debt modification costs | (24 | ) | — | (624 | ) | — | |||||||||
Adjustment to fair value of warrants and other | 181 | — | (60 | ) | 12 | ||||||||||
(2,591 | ) | (1,829 | ) | (7,424 | ) | (4,864 | ) | ||||||||
Income (loss) before income taxes | 312 | 1,432 | (2,138 | ) | (572 | ) | |||||||||
Income tax expense (benefit) | 177 | (603 | ) | 458 | (425 | ) | |||||||||
Net income (loss) | $ | 135 | $ | 2,035 | $ | (2,596 | ) | $ | (147 | ) |
For the three months ended September 30, 2016 | |||||||||||||||||||||||
(In thousands) | |||||||||||||||||||||||
Operating income (loss) | Depreciation and amortization | Write-offs, recoveries and asset disposals | Project development and acquisition costs | Stock compensation | Adjusted EBITDA | ||||||||||||||||||
Casino properties | |||||||||||||||||||||||
Silver Slipper Casino and Hotel | $ | 1,480 | $ | 818 | $ | 6 | $ | — | $ | — | $ | 2,304 | |||||||||||
Rising Star Casino Resort | 83 | 660 | 8 | — | — | 751 | |||||||||||||||||
Bronco Billy's Casino and Hotel | 1,106 | 504 | — | — | — | 1,610 | |||||||||||||||||
Northern Nevada Casinos | 1,350 | 219 | 295 | — | — | 1,864 | |||||||||||||||||
4,019 | 2,201 | 309 | — | — | 6,529 | ||||||||||||||||||
Other operations | |||||||||||||||||||||||
Corporate | (1,116 | ) | 2 | — | 130 | 95 | (889 | ) | |||||||||||||||
(1,116 | ) | 2 | — | 130 | 95 | (889 | ) | ||||||||||||||||
$ | 2,903 | $ | 2,203 | $ | 309 | $ | 130 | $ | 95 | $ | 5,640 |
For the three months ended September 30, 2015 | |||||||||||||||||||||||||||
(In thousands) | |||||||||||||||||||||||||||
Operating income (loss) | Depreciation and amortization | Write-offs, recoveries and asset disposals | Project development and acquisition costs | Pre-opening | Stock compensation | Adjusted EBITDA | |||||||||||||||||||||
Casino properties | |||||||||||||||||||||||||||
Silver Slipper Casino and Hotel | $ | 1,070 | $ | 1,322 | $ | — | $ | — | $ | 21 | $ | — | $ | 2,413 | |||||||||||||
Rising Star Casino Resort | 1,777 | 678 | — | — | — | — | 2,455 | ||||||||||||||||||||
Bronco Billy's Casino and Hotel | — | — | — | — | — | — | — | ||||||||||||||||||||
Northern Nevada Casinos | 2,028 | 199 | — | — | — | — | 2,227 | ||||||||||||||||||||
4,875 | 2,199 | — | — | 21 | — | 7,095 | |||||||||||||||||||||
Other operations | |||||||||||||||||||||||||||
Corporate | (1,614 | ) | 4 | — | 709 | — | 57 | (844 | ) | ||||||||||||||||||
(1,614 | ) | 4 | — | 709 | — | 57 | (844 | ) | |||||||||||||||||||
$ | 3,261 | $ | 2,203 | $ | — | $ | 709 | $ | 21 | $ | 57 | $ | 6,251 |
For the nine months ended September 30, 2016 | |||||||||||||||||||||||
(In thousands) | |||||||||||||||||||||||
Operating income (loss) | Depreciation and amortization | Write-offs, recoveries and asset disposals | Project development and acquisition costs | Stock compensation | Adjusted EBITDA | ||||||||||||||||||
Casino properties | |||||||||||||||||||||||
Silver Slipper Casino and Hotel | $ | 4,847 | $ | 2,482 | $ | 6 | $ | — | $ | — | $ | 7,335 | |||||||||||
Rising Star Casino Resort | 482 | 1,993 | 8 | — | — | 2,483 | |||||||||||||||||
Bronco Billy's Casino and Hotel | 1,975 | 723 | — | — | — | 2,698 | |||||||||||||||||
Northern Nevada Casinos | 2,372 | 589 | 295 | — | — | 3,256 | |||||||||||||||||
9,676 | 5,787 | 309 | — | — | 15,772 | ||||||||||||||||||
Other operations | |||||||||||||||||||||||
Corporate | (4,390 | ) | 8 | — | 902 | 315 | (3,165 | ) | |||||||||||||||
(4,390 | ) | 8 | — | 902 | 315 | (3,165 | ) | ||||||||||||||||
$ | 5,286 | $ | 5,795 | $ | 309 | $ | 902 | $ | 315 | $ | 12,607 |
For the nine months ended September 30, 2015 | |||||||||||||||||||||||||||
(In thousands) | |||||||||||||||||||||||||||
Operating income (loss) | Depreciation and amortization | Project development and acquisition costs | Write-offs, recoveries and asset disposals | Pre-opening | Stock compensation | Adjusted EBITDA | |||||||||||||||||||||
Casino properties | |||||||||||||||||||||||||||
Silver Slipper Casino and Hotel | $ | 4,058 | $ | 3,582 | $ | — | $ | — | $ | 134 | $ | — | $ | 7,774 | |||||||||||||
Rising Star Casino Resort | 1,212 | 2,039 | — | — | — | — | 3,251 | ||||||||||||||||||||
Bronco Billy's Casino and Hotel | — | — | — | — | — | — | — | ||||||||||||||||||||
Northern Nevada Casinos | 2,596 | 593 | — | 80 | — | — | 3,269 | ||||||||||||||||||||
7,866 | 6,214 | — | 80 | 134 | — | 14,294 | |||||||||||||||||||||
Other operations | |||||||||||||||||||||||||||
Corporate | (3,574 | ) | 11 | 760 | (446 | ) | — | 285 | (2,964 | ) | |||||||||||||||||
(3,574 | ) | 11 | 760 | (446 | ) | — | 285 | (2,964 | ) | ||||||||||||||||||
$ | 4,292 | $ | 6,225 | $ | 760 | $ | (366 | ) | $ | 134 | $ | 285 | $ | 11,330 |
• | general market and economic conditions, including but not limited to, the effects of local and national economic, housing and energy conditions on the economy in general and on the gaming and lodging industries in particular; |
• | access to capital and credit, including our ability to finance future business requirements and to repay or refinance debt as it matures; |
• | dependence on key personnel; |
• | availability of adequate levels of insurance; |
• | changes in federal, state, and local gaming, taxation, and environmental laws, regulations and legislation, including obtaining and maintaining gaming and other licenses; |
• | impact of weather; |
• | lack of alternative routes to certain of our properties; |
• | competitive environment, including increased competition in our target market areas; |
• | increases in the effective rate of taxation at any of our properties or at the corporate level; and |
• | other risks, uncertainties and factors described from time to time in this and our other SEC filings and reports. |
• | making it more difficult for us to satisfy our obligations with respect to our existing indebtedness; |
• | limiting our ability to obtain additional financing without restructuring the covenants in our existing indebtedness to permit the incurrence of such financing; |
• | requiring a substantial portion of our cash flow to be used for payments on debt and related interest, thereby reducing our ability to use cash flow to fund other working capital, capital expenditures and general corporate requirements; |
• | limiting our ability to respond to changing business, industry and economic conditions and to withstand competitive pressures, which may affect our financial condition; |
• | causing us to incur higher interest expense, either in the event of increases in interest rates on our borrowings that have variable interest rates, or in the event of refinancing existing debt at higher interest rates; |
• | limiting our ability to make investments, dispose of assets, pay cash dividends or repurchase stock; |
• | increasing our vulnerability to downturns in our business, our industry or the general economy and restricting us from making improvements or acquisitions or exploring business opportunities; |
• | placing us at a competitive disadvantage to competitors with less debt or greater resources; and |
• | subjecting us to financial and other restrictive covenants in our indebtedness, the non-compliance with which could result in an event of default. |
• | regional economic conditions; |
• | regional competitive conditions, including legalization or expansion of gaming in Mississippi, Colorado, Indiana, Nevada, or in neighboring states; |
• | allowance of new types of gaming, such as the introduction of live table games at Indiana racinos; |
• | reduced land and air travel due to increasing fuel costs or transportation disruptions; and, |
• | increase in our vulnerability to economic downturns and competitive pressures in the markets in which we operate. |
4.1 | Prospectus for Subscription Rights to Purchase Common Stock effective October 6, 2016 (incorporated by reference to the Company’s Form 424B2 filed October 7, 2016) | |
4.2 | Registration Statement effective October 6, 2016 (incorporated by reference to the Company’s Form S-3 filed on August 15, 2016) | |
4.3 | Amendment to Registration Statement (incorporated by reference to the company’s Form S-3/A filed on September 16, 2016) | |
4.4 | Amendment to Registration Statement (incorporated by reference to the Company’s Form S-3/A filed on October 3, 2016) | |
10.1 | Third Amendment to Casino Operations Lease, effective August 29, 2016, between Hyatt Equities, L.L.C. and Gaming Entertainment (Nevada) LLC | |
10.2 | Standby Purchase Agreement dated October 7, 2016 between the Company and Daniel R. Lee (incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed on October 7, 2016) | |
10.3 | Registration Rights Agreement dated October 7, 2016 between the Company and Daniel R. Lee (incorporated by reference to Exhibit 10.2 to the Company’s Current Report on Form 8-K filed on October 7, 2016) | |
23.1 | Consent of Brownstein Hyatt Farber Shreck, LLP (incorporated by reference to Exhibit 5.1 to the Company’s Form S-3 filed on August 15, 2016) | |
23.2 | Consent of Piercy Bowler Taylor & Kern (incorporated by reference to Exhibit 23.1 to the Company’s Form S-3/A filed on October 3, 2016) | |
23.3 | Consent of BKD, LLP (incorporated by reference to Exhibit 23.2 to the Company’s Form S-3/A filed on October 3, 2016) | |
31.1* | Certification of principal executive officer pursuant to 18 U.S.C. section 1350, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 | |
31.2* | Certification of principal financial officer pursuant to 18 U.S.C. section 1350, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 | |
32.1* | Certification of principal executive officer pursuant to 18 U.S.C. section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 | |
32.2* | Certification of principal financial officer pursuant to 18 U.S.C. section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 | |
101.INS* | XBRL Instance | |
101.SCH* | XBRL Taxonomy Extension Schema | |
101.CAL* | XBRL Taxonomy Extension Calculation | |
101.DEF* | XBRL Taxonomy Extension Definition | |
101.LAB* | XBRL Taxonomy Extension Labels | |
101.PRE* | XBRL Taxonomy Extension Presentation |
* | Filed herewith. | |
FULL HOUSE RESORTS, INC. | ||
Date: November 10, 2016 | By: | /s/ DANIEL R. LEE |
Daniel R. Lee Chief Executive Officer (on behalf of the Registrant and as principal executive officer) | ||
Date: November 10, 2016 | By: | /s/ LEWIS A. FANGER |
Lewis A. Fanger Chief Financial Officer (on behalf of the Registrant and as principal financial officer and as principal accounting officer) |
1. | I have reviewed this Quarterly Report on Form 10-Q of Full House Resorts, Inc.; |
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |
4. | The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f)) and 15d-15(f)) for the registrant and have: |
a. | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
b. | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
c. | Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
d. | Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant’s most recent quarter (the registrant’s fourth quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect the registrant’s internal control over financial reporting; and |
5. | The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent function): |
a) | All significant deficiencies and material weaknesses in the design or operation of internal controls over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and |
b) | Any fraud, whether or not material, that involves management of other employees who have a significant role in the registrant’s internal controls over financial reporting. |
Date: November 10, 2016 | By: | /s/ DANIEL R. LEE |
Daniel R. Lee | ||
Chief Executive Officer |
1. | I have reviewed this Quarterly Report on Form 10-Q of Full House Resorts, Inc.; |
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |
4. | The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: |
a) | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
b) | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
c) | Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
d) | Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent quarter (the registrant’s fourth quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect the registrant’s internal control over financial reporting; and |
5. | The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent function): |
a) | All significant deficiencies and material weaknesses in the design or operation of internal controls over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and |
b) | Any fraud, whether or not material, that involves management of other employees who have a significant role in the registrant’s internal controls over financial reporting. |
Dates: November 10, 2016 | By: | /s/ LEWIS A. FANGER |
Lewis A. Fanger | ||
Chief Financial Officer |
(1) | The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and |
(2) | The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of Full House Resorts, Inc. |
Date: November 10, 2016 | By: | /s/ DANIEL R. LEE |
Daniel R. Lee | ||
Chief Executive Officer |
(1) | The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and |
(2) | The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of Full House Resorts, Inc. |
Date: November 10, 2016 | By: | /s/ LEWIS A. FANGER |
Lewis A. Fanger | ||
Chief Financial Officer |
Document and Entity Information - shares |
9 Months Ended | |
---|---|---|
Sep. 30, 2016 |
Nov. 10, 2016 |
|
Document and Entity Information [Abstract] | ||
Entity Registrant Name | FULL HOUSE RESORTS INC | |
Entity Central Index Key | 0000891482 | |
Trading Symbol | fll | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Smaller Reporting Company | |
Entity Common Stock, Shares Outstanding | 22,864,963 | |
Document Type | 10-Q | |
Document Period End Date | Sep. 30, 2016 | |
Amendment Flag | false | |
Document Fiscal Year Focus | 2016 | |
Document Fiscal Period Focus | Q3 |
CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) - USD ($) $ in Thousands |
3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
Sep. 30, 2016 |
Sep. 30, 2015 |
Sep. 30, 2016 |
Sep. 30, 2015 |
|
Revenues | ||||
Casino | $ 37,460 | $ 30,577 | $ 97,897 | $ 84,374 |
Food and beverage | 8,282 | 6,891 | 21,438 | 19,053 |
Hotel | 2,361 | 2,020 | 6,488 | 4,836 |
Other operations | 1,253 | 1,208 | 3,096 | 2,890 |
Gross revenues | 49,356 | 40,696 | 128,919 | 111,153 |
Less promotional allowances | (7,600) | (6,430) | (20,309) | (17,077) |
Net revenues | 41,756 | 34,266 | 108,610 | 94,076 |
Operating costs and expenses | ||||
Casino | 19,814 | 15,600 | 50,574 | 43,569 |
Food and beverage | 2,817 | 2,282 | 7,090 | 6,632 |
Hotel | 297 | 248 | 768 | 678 |
Other operations | 475 | 372 | 1,236 | 1,023 |
Selling, general and administrative | 12,808 | 9,570 | 36,650 | 30,763 |
Project development and acquisition costs | 130 | 730 | 902 | 894 |
Depreciation and amortization | 2,203 | 2,203 | 5,795 | 6,225 |
Loss on disposal of assets, net | 309 | 0 | 309 | 0 |
Total operating costs and expenses | 38,853 | 31,005 | 103,324 | 89,784 |
Operating income | 2,903 | 3,261 | 5,286 | 4,292 |
Other (expense) income | ||||
Interest expense, net of amounts capitalized | (2,748) | (1,829) | (6,740) | (4,876) |
Debt modification costs | (24) | 0 | (624) | 0 |
Adjustment to fair value of warrants and other | 181 | 0 | (60) | 12 |
Total other (expense) income | (2,591) | (1,829) | (7,424) | (4,864) |
Income (loss) before income taxes | 312 | 1,432 | (2,138) | (572) |
Provision (benefit) for income taxes | 177 | (603) | 458 | (425) |
Net income (loss) | $ 135 | $ 2,035 | $ (2,596) | $ (147) |
Basic income (loss) per share (in dollars per share) | $ 0.01 | $ 0.11 | $ (0.14) | $ (0.01) |
Diluted income (loss) per share (in dollars per share) | $ 0.00 | $ 0.11 | $ (0.14) | $ (0.01) |
CONSOLIDATED BALANCE SHEETS (Unaudited) (Parentheticals) - USD ($) $ in Thousands |
Sep. 30, 2016 |
Dec. 31, 2015 |
---|---|---|
Statement of Financial Position [Abstract] | ||
Allowance for doubtful accounts | $ 83 | $ 121 |
Accumulated amortization of intangible assets | $ 7,725 | $ 7,701 |
Common stock, par value (in dollars per share) | $ 0.0001 | $ 0.0001 |
Common stock, shares authorized | 100,000,000 | 100,000,000 |
Common stock, shares issued | 20,375,404 | 20,325,991 |
Common stock, shares outstanding | 19,018,809 | 18,969,396 |
Treasury stock, common shares | 1,356,595 | 1,356,595 |
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (Unaudited) - 9 months ended Sep. 30, 2016 - USD ($) shares in Thousands, $ in Thousands |
Total |
Common stock |
Additional paid-in capital |
Treasury stock |
Retained Earnings |
---|---|---|---|---|---|
Beginning balances at Dec. 31, 2015 | $ 56,523 | $ 2 | $ 46,221 | $ (1,654) | $ 11,954 |
Beginning balances (in shares) at Dec. 31, 2015 | 20,326 | 1,357 | |||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Stock-based compensation | 315 | 315 | |||
Stock-based compensation (in shares) | 49 | ||||
Net loss | (2,596) | (2,596) | |||
Ending balances at Sep. 30, 2016 | $ 54,242 | $ 2 | $ 46,536 | $ (1,654) | $ 9,358 |
Ending balances (in shares) at Sep. 30, 2016 | 20,375 | 1,357 |
ORGANIZATION |
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Organization, Consolidation and Presentation of Financial Statements [Abstract] | |||||||||||||||||||||||||||||||||||||||||
ORGANIZATION | ORGANIZATION Organization. Formed as a Delaware corporation in 1987, Full House Resorts, Inc. owns, operates, develops, manages, and/or invests in casinos and related hospitality and entertainment facilities. References in this document to "Full House", the "Company", “we”, “our”, or “us” refer to Full House Resorts, Inc. and its subsidiaries, except where stated or the context otherwise indicates. On May 13, 2016, the Company completed its acquisition of Bronco Billy's Casino and Hotel and concurrently refinanced its outstanding first and second lien debt. We currently own and operate four casino properties and operate Grand Lodge Casino subject to a space lease. The following identifies the properties along with their dates of acquisition and locations:
We manage our casinos based on geographic regions within the United States. Accordingly, Stockman’s Casino and Grand Lodge Casino comprise our Northern Nevada business segment, while Silver Slipper, Rising Star, and Bronco Billy's are currently distinct segments. See Note 12 for further information. |
BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES |
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Sep. 30, 2016 | |
Accounting Policies [Abstract] | |
BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES | BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES Basis of Presentation. As permitted by the rules and regulations of the Securities and Exchange Commission, certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles in the United States of America (“GAAP”) have been condensed or omitted. These consolidated financial statements should be read in conjunction with the Company’s 2015 annual consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2015. The interim consolidated financial statements of the Company included herein reflect all adjustments (consisting of normal recurring adjustments) that are, in the opinion of management, necessary to present fairly the financial position and results of operations for the interim periods presented. The results of operations for the interim periods are not necessarily indicative of the results that may be expected for the entire year. The consolidated financial statements include the accounts of Full House and its wholly-owned subsidiaries. All material inter-company accounts and transactions have been eliminated. Fair Value Measurements. Fair value measurements affect our accounting for net assets acquired in acquisition transactions, share-based compensation, and certain financial assets and liabilities such as our common stock warrant liability. Our periodic assessments of long-lived tangible and intangible assets for possible impairment, including for property and equipment, goodwill, and other intangible assets, may also be affected by fair value measurements. Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date and is measured according to a hierarchy that includes: “Level 1” inputs, such as quoted prices in an active market for identical assets or liabilities; “Level 2” inputs, which are observable inputs for similar assets; or “Level 3” inputs, which are unobservable inputs. The Company utilizes Level 3 inputs when measuring net assets acquired in business combination transactions, subsequent assessments for impairment, and the estimated fair value of common stock warrants at issuance and for recurring changes in the related warrant liability (see Note 6). Income Taxes. For interim income tax reporting, it was determined that the Company's annual effective tax rate could not be reasonably estimated at the present time. As a result, the actual year-to-date effective tax rate was used to determine the tax expense incurred during the three and nine months ended September 30, 2016 and 2015. Earnings (Loss) Per Share. Earnings (loss) per share is computed by dividing net income (loss) applicable to common stock by the weighted average number of common shares outstanding during the period. Diluted earnings per share reflects the additional dilution for all potentially-dilutive securities, including common stock options, warrants and unvested restricted shares, using the treasury stock method. Debt Issuance Costs. In April 2015, the Financial Accounting Standards Board (the "FASB") issued Accounting Standards Update ("ASU") No. 2015-03, “Simplifying the Presentation of Debt Issuance Costs,” (“ASU 2015-03”), which is effective for fiscal years, and interim periods within those years, beginning after December 15, 2015. ASU 2015-03 requires debt issuance costs to be presented in the balance sheet as a direct deduction from the carrying value of the associated debt liability, consistent with the presentation of a debt discount. The amortization of such costs will continue to be reported as interest expense. Accordingly, the Company has adopted this accounting standard and reclassified the prior-period amounts to conform to the current-period presentation. Reclassifications. Certain minor reclassifications have been made to prior period amounts to conform to the current-period presentation. Such reclassifications had no effect on the previously reported net income (loss) or retained earnings. Recently Issued Accounting Standards. In February 2016, the FASB issued ASU No. 2016-02, “Leases (Topic 842),” (“ASU 2016-02”), which replaces the existing guidance in ASC 840, Leases. ASU 2016-02 is effective for fiscal years, and interim periods within those years, beginning after December 15, 2018. ASU 2016-02 requires a dual approach for lessee accounting under which a lessee would account for leases as finance leases or operating leases. Both finance leases and operating leases will result in the lessee recognizing a right-of-use (“ROU”) asset and a corresponding lease liability. The Company is currently assessing the impact that adoption of this guidance will have on its consolidated financial statements and footnote disclosures. Management believes that there are no other recently issued accounting standards not yet effective that are likely to have a material impact on our financial statements. |
ACQUISITION |
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Business Combinations [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
ACQUISITION | ACQUISITION On May 13, 2016, we completed our acquisition of Bronco Billy's Casino and Hotel from Pioneer Group, Inc. for estimated consideration of $31.1 million, inclusive of an adjustment for net working capital. The acquisition included the three licensed operations in Cripple Creek, Colorado known as Bronco Billy's Casino, Buffalo Billy's Casino and Billy's Casino (collectively referred to as "Bronco Billy's"). The results of Bronco Billy's operations have been included in the consolidated financial statements since that date. The acquisition was financed primarily through a $35 million increase in our Second Lien Credit Facility (see Note 6). Bronco Billy’s has approximately 803 slot and video poker machines, 13 table games and a 24-guest-room hotel. This acquisition diversifies our operations into a new geographical market. We are in the process of completing our valuation analysis and thus these estimates are subject to change. During the quarter ended September 30, 2016, the Company recognized a measurement period adjustment increasing the carrying amount of certain leasehold improvements within property, plant and equipment by $500,000, with a corresponding decrease to gaming licenses. The related additional amortization expense for the leasehold improvements was not material. The following table summarizes our preliminary estimates of the fair values of the assets acquired and liabilities assumed at the acquisition date:
The $4.8 million of estimated goodwill, which represents the excess of the purchase price over the estimated fair value of the assets acquired, was primarily attributable to expected synergies and the economic benefits arising from other assets acquired that could not be individually identified and separately recognized, including the assembled workforce of Bronco Billy's. All of the goodwill is expected to be deductible for income tax purposes. Gaming licenses and trade names are intangible assets with indefinite useful lives. The Company incurred $0.4 million of acquisition-related costs for the nine months ended September 30, 2016 and $0.4 million for the year ended December 31, 2015. These costs are included in the consolidated statements of operations under "Project development and acquisition costs". We also incurred $1.5 million of debt issuance costs, $0.6 million of warrant issuance costs, and $0.6 million of debt modification expenses in conjunction with the refinanced credit facilities. From May 13, 2016 through September 30, 2016, Bronco Billy's revenues were $11.1 million and net income was $1.9 million and were included in our consolidated statements of operations for the nine months ended September 30, 2016. The following unaudited pro forma consolidated income statement for the Company includes the results of Bronco Billy's as if the acquisition and related financing transactions occurred on January 1, 2015. The pro forma financial information does not necessarily represent the results that might have actually occurred or may occur in the future. The pro forma amounts include the historical operating results of Full House and Bronco Billy's prior to the acquisition, adjusted only for matters directly attributable to the acquisition, which primarily include interest expense related to the Amended and Restated First and Second Lien Credit Facilities (see Note 6). The pro forma results also reflect adjustments for the impact of depreciation and amortization expense based on the estimated fair value of property and equipment acquired, tax expense, and the removal of non-recurring expenses directly attributable to the transaction of $58,000 and $0.8 million for the three months ended September 30, 2016 and 2015, and $1.2 million and $0.9 million for the nine months ended September 30, 2016 and 2015. The pro forma results do not include any anticipated synergies or other expected benefits from the acquisition.
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PROPERTY AND EQUIPMENT |
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Property, Plant and Equipment [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
PROPERTY AND EQUIPMENT | PROPERTY AND EQUIPMENT Property and equipment, including capital lease assets, consists of the following:
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GOODWILL AND OTHER INTANGIBLES |
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Sep. 30, 2016 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
GOODWILL AND OTHER INTANGIBLES | GOODWILL AND OTHER INTANGIBLES At least annually during the fourth quarter, or more frequently when there is a material change in circumstances that could have a negative effect, the Company performs an assessment of its goodwill and other indefinite-lived intangible assets to determine if the carrying value of such assets exceeds the fair value. No change in circumstances that would trigger an evaluation occurred during the three and nine months ended September 30, 2016, or subsequently. |
LONG-TERM DEBT AND WARRANT LIABILITY |
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Debt Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
LONG-TERM DEBT AND WARRANT LIABILITY | LONG-TERM DEBT AND WARRANT LIABILITY Long-Term Debt On May 13, 2016, we entered into an amended and restated First Lien Credit Facility ("Amended and Restated First Lien Credit Facility") with Capital One Bank, N.A., ("Capital One"), which includes a First Term Loan of $45 million and Revolving Loan of $2 million, and an amended and restated Second Lien Credit Facility ("Amended and Restated Second Lien Credit Facility") with ABC Funding, LLC, which includes a term loan facility increase from $20 million to $55 million, of which the additional proceeds of $35 million were used primarily to complete our acquisition of Bronco Billy's. The Amended and Restated First and Second Lien Credit Facilities are secured by substantially all of our assets and our wholly-owned subsidiaries guarantee our obligations under the agreements. The Amended and Restated Second Lien Credit Facility is subordinate to the lien of the Amended and Restated First Lien Credit Facility. Long-term debt, related discounts and issuance costs consists of the following:
First Lien Credit Facility. The Amended and Restated First Lien Credit Facility matures in May 2019 and requires monthly interest-only payments and quarterly principal payments of $562,500 until May 2018, with such quarterly principal payments increasing to $843,750 through maturity. We incurred debt issuance costs of $248,000, which are being amortized over the remaining term of the loan, and expensed debt modification costs of $330,000. We made our required quarterly payment of $562,500 due October 1, 2016, on September 30, 2016. The interest rate of the Amended and Restated First Lien Credit Facility is initially based on the greater of the elected London Interbank Offered Rate (“LIBOR”) (as defined) or 1.0%, plus a margin rate of 3.75%. The margin rate of 3.75% will increase by 50 basis points beginning in May 2017 and will increase by an additional 50 basis points if the Company does not raise at least $5 million of gross equity proceeds by May 13, 2017. The rights offering satisfied this latter condition, preventing such increase in the interest rate spread (see footnote 13). There is no prepayment premium or interest rate cap associated with this facility. During June 2016, $569,000 of previously restricted cash proceeds drawn from the original construction loan were released to the Company. Second Lien Credit Facility. The Amended and Restated Second Lien Credit Facility matures on the earlier of (i) May 13, 2022, or (ii) six months following the maturity date of the Amended and Restated First Lien Credit Facility. Given that the Amended and Restated First Lien Credit Facility currently matures in May 2019, the current maturity date of the Amended and Restated Second Lien Credit Facility is November 2019. Interest is currently payable monthly at a rate of 13.5% (and may vary between 12.5% and 13.5%, depending on the total leverage of the Company), and there are no quarterly principal payment requirements as all principal is due at maturity. The prepayment premium is 3% of the total principal amount until May 13, 2017, 2% until May 13, 2018, 1% until May 13, 2019, and no prepayment premium thereafter. We incurred debt issuance costs of $1,239,000, which are being amortized over the current remaining term of the loan, and expensed debt modification costs of $294,000. Covenants. The Amended and Restated First and Second Lien Credit Facilities contain customary negative covenants, including, but not limited to, restrictions on our ability to: incur indebtedness; grant liens; pay dividends and make other restricted payments; make investments; dispose of assets; and change the basic underlying nature of our business. We are also required to make capital expenditures of at least 1.425%, and no more than 5.25%, of our prior-year revenues, excluding capital expenditures made from any future sale of equity securities. The Amended and Restated First Lien and Second Lien Credit Facilities define Adjusted EBITDA as, for any four fiscal quarter period, (a) net income (loss) for such period, plus (b) to the extent deducted in determining net income (loss) for such period: (i) interest expense, (ii) provisions for income taxes, (iii) depreciation and amortization expenses, (iv) extraordinary losses (including non-cash impairment charges), (v) stock compensation expense, (vi) acquisition costs related to Bronco Billy's in an aggregate amount not to exceed $1 million, (vii) pre-opening expenses related to the hotel at Silver Slipper that opened in 2015, and (viii) non-recurring development expenses for new initiatives in an aggregate amount not to exceed $500,000 for the trailing four consecutive fiscal quarters, minus (c) extraordinary gains, and minus (d) joint venture net income, unless such net income has been actually received by the Company in the form of cash dividends or distributions. Adjusted EBITDA shall include results for Bronco Billy's as if it were owned for the entire measurement period. The Amended and Restated First Lien and Second Lien Credit Facilities require that we maintain specified financial covenants, including a total leverage ratio, a first lien leverage ratio, and a fixed charge coverage ratio, all of which measure Adjusted EBITDA against outstanding debt and fixed charges (as defined in the agreements). These financial covenant ratios currently are as follows:
Additionally, the Fixed Charge Coverage Ratio as of the last day of any fiscal quarter shall not be less than 1.10x.
Additionally, the Fixed Charge Coverage Ratio as of the last day of any fiscal quarter shall not be less than 1.0x. We were in compliance with our covenants as of September 30, 2016; however, there can be no assurances that we will remain in compliance with all covenants in the future. The Amended First and Second Lien Credit Facilities also include customary events of default, including, among other things: non-payment; breach of covenant; breach of representation or warranty; cross-default under certain other indebtedness or guarantees; commencement of insolvency proceedings; inability to pay debts; entry of certain material judgments against us or our subsidiaries; occurrence of certain ERISA events; repurchase of our own stock; and certain changes of control. A breach of a covenant or other events of default could cause the loans to be immediately due and payable, terminate commitments for additional loan funds, or the lenders could exercise any other remedy available under the Amended and Restated First and Second Lien Credit Facilities or by law. If a breach of covenants or other event of default were to occur, we would seek modifications to covenants or a temporary waiver or waivers from the Amended and Restated First and Second Lien Credit Facilities lenders. No assurance can be given that we would be successful in obtaining such waivers or modifications. We are required to make prepayments under the Amended and Restated First Lien Credit Facility, under certain conditions as defined in the agreement, in addition to the scheduled principal installments as defined. With regards to the Amended and Restated Second Lien Credit Facility, no mandatory prepayments are required prior to the discharge of the First Lien Credit Facility. Warrant Liability As part of the Amended and Restated Second Lien Credit Facility, on May 13, 2016, the Company granted the second lien lenders 1,006,568 warrants representing 5% of the outstanding common equity of the Company, as determined on a fully-diluted basis. The warrants have an exercise price of $1.67 (the average trading price of the Company's common stock during a 60-day period bracketing the completion of the financing) and expire May 13, 2026. The warrants also provide the second lien lenders with redemption rights, pre-emptive rights under certain circumstances to maintain their 5% ownership interest in the Company, piggyback registration rights and mandatory registration rights after two years. The redemption rights allow the second lien lenders, at their option, to require the Company to repurchase all or a portion of all of the warrants in the event of: (i) the maturity of the Amended and Restated Second Lien Credit Facility, (ii) an acceleration pursuant to the Amended and Restated Second Lien Credit Facility, (iii) a refinancing, repayment or other transaction decreasing the aggregate principal amount of the Amended Second Lien Facility debt outstanding as of May 13, 2016 by more than 50%, (iv) a liquidity event, as defined, or (v) the Company's insolvency. The repurchase value is the 21-day average price of the Company's stock at the time of the event, as defined, net of the warrant exercise price. If the redemption rights are exercised, the repurchase amount is payable by the Company in cash or through the issuance of an unsecured note with a four-year term and a minimum interest rate of 13.25%, as further defined. Although unsecured, the note would be guaranteed by the Company's subsidiaries. Alternatively, the second lien lenders may choose to have the Company register and sell the shares related to the warrants through a public stock offering. We measure the fair value of the warrants at each reporting period. The fair value at issuance of the warrants was $0.6 million, which was recorded as a liability due to the redemption feature and a resulting discount to the Amended and Restated Second Lien Credit Facility. The discount is amortized to interest expense during the expected term of the Amended and Restated Second Lien Credit Facility, which is currently 3.5 years. The Company recognized $0.2 million of income and $0.1 million of expense for the three and nine months ended September 30, 2016, respectively, due to a change in the fair value of the warrants, which was reflected as part of "Other" non-operating expense on the consolidated statements of operations. Due to the variable terms regarding the timing of the settlement of the warrants, the Company utilized a "Monte Carlo" simulation approach to measure the fair value of the warrants. The simulation included the Company's stock price and the following assumptions: an expected contractual term of 3.85 years, an expected stock price volatility rate of 44.78%, an expected dividend yield of 0%, and an expected risk-free interest rate of 1.1%. The simulation included certain estimates by Company management regarding the estimated timing of the settlement of the warrants. Significant increases or decreases in those management estimates would result in a significantly higher or lower fair value measurement. The Company also utilized the Monte Carlo simulation approach for its valuation at September 30, 2016 which included the following assumptions: an expected contractual term of 3.57 years, an expected stock price volatility rate of 45.99%, an expected dividend yield of 0%, and an expected risk-free interest rate of 1.06%. |
CAPITAL LEASE OBLIGATION |
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Sep. 30, 2016 | |
Leases, Capital [Abstract] | |
CAPITAL LEASE OBLIGATION | CAPITAL LEASE OBLIGATION Our Indiana subsidiary, Gaming Entertainment (Indiana) LLC ("GEI"), leases a 104-room hotel at Rising Star Casino Resort. At any time during the lease term, we have the exclusive option to purchase the hotel at a price based upon the project’s actual cost of $7.7 million, reduced by the cumulative principal payments made by the Company during the lease term. At September 30, 2016, such net amount was $5.8 million. Upon expiration of the lease term, (i) the Landlord has the right to sell the hotel to us, and (ii) we have the option to purchase the hotel. In either case, the purchase price is $1 plus closing costs. The hotel lease agreement is not guaranteed by any other subsidiary or the parent company. On March 16, 2016, the hotel lease agreement was amended. The amendment extended the initial term of the lease by four years to October 1, 2027 and modified the rent payment schedule. The rental rate has been reduced from $77,537 per month as follows: (i) to $48,537 per month from April 2016 through March 2017, (ii) to $56,537 per month from April 2017 through March 2018; (iii) to $57,537 per month from April 2018 through March 2019; and (iv) to $63,537 per month from April 2019 through March 2020. Beginning April 1, 2020 through the end of the lease, the scheduled monthly payment shall be $54,326. The amendment also requires the Company to make certain improvements to the Rising Star Casino Resort of at least $1 million by March 31, 2017 which the Company planned and intends to complete. If the Company does not make the $1 million of improvements, the lease will revert back to the original payment schedule. |
INCOME TAXES |
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Sep. 30, 2016 | |
Income Tax Disclosure [Abstract] | |
INCOME TAXES | INCOME TAXES The Company's effective income tax rate for the three and nine months ended September 30, 2016 was 56.9% and -21.4%, compared to an effective tax rate of -42.1% and 74.3% during the corresponding prior-year periods. Our tax rate differs from the statutory rate of 34.0% primarily due to the effects of our valuation allowance and certain permanent items for tax purposes, with such differences being amplified by the Company's low pre-taxable income (loss) during recent periods. During 2016, we continued to provide a valuation allowance against the deferred tax assets that remain after being utilized by available deferred tax liabilities. In future years, if it is determined that we meet the "more likely than not" threshold of utilizing our deferred tax assets, we may reverse some or all of our valuation allowance against our deferred tax assets. Our annual effective tax rate could not be reasonably estimated at the present time. |
COMMITMENTS AND CONTINGENCIES |
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Sep. 30, 2016 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENCIES | COMMITMENTS AND CONTINGENCIES Operating Leases In addition to the following leases, we have less significant operating leases for certain office and warehouse facilities, office equipment, signage and land. Grand Lodge Casino Lease through August 2023. Our subsidiary, Gaming Entertainment (Nevada), LLC, has a lease with Hyatt Equities L.L.C. ("Hyatt") to operate the Grand Lodge Casino. The lease is secured by the Company’s interests under the lease and property as defined and is subordinate to the liens in the Amended and Restated First and Second Lien Credit Facilities. Hyatt has an option, beginning January 1, 2019, to purchase our leasehold interest and related operating assets of the Grand Lodge Casino subject to assumption of applicable liabilities. The option price is an amount equal to the Grand Lodge Casino’s positive working capital, plus Grand Lodge Casino’s earnings before interest, income taxes, depreciation and amortization (“EBITDA”) for the twelve-month period preceding the acquisition (or pro-rated if less than twelve months remain on the lease), plus the fair market value of the Grand Lodge Casino’s personal property. Monthly rent will increase from $125,000 to (i) $145,833 commencing on January 1, 2017 (or the date which Hyatt's renovations are completed as described below, whichever is later), and (ii) $166,667 commencing on January 1, 2018. As a condition of the lease, the Company is required to purchase new gaming devices and equipment or make other capital expenditures at its sole cost and expense of approximately $1.5 million and Hyatt is required to renovate the casino at its sole cost and expense of approximately $3.5 million, with both parties completing these renovations by June 30, 2017. We also have an agreement with Hyatt to rent a villa for use by our designated casino guests which commenced on June 1, 2016. The villa is a free-standing building and consists of two, two-bedroom suites. The agreement includes monthly payments of $41,667, a six-month termination notification clause which may be exercised by either party, and a maturity date of August 31, 2023, or earlier as set forth therein. Silver Slipper Casino Land Lease through April 2058 and Options to Purchase. In 2004, our subsidiary, Silver Slipper Casino Venture, LLC, entered into a land lease with Cure Land Company, LLC for approximately 31 acres of marshlands and a seven-acre parcel on which the Silver Slipper Casino and Hotel is situated (the "Silver Slipper Land Lease"). The Silver Slipper Land Lease includes base monthly payments of $77,500 plus contingent rents of 3% of monthly gross gaming revenue (as defined) in excess of $3.65 million. The Silver Slipper Land Lease includes an exclusive option to purchase the leased land (“Purchase Option”) after February 26, 2019 through October 1, 2027, for $15.5 million plus a seller retained interest in Silver Slipper Casino & Hotel’s operations of 3% of net income (as defined), for ten years from the purchase date. In the event that we sell or transfer (i) substantially all of the assets of Silver Slipper Casino Venture, LLC, or (ii) our membership interests in Silver Slipper Casino Venture, LLC in its entirety, the purchase price will increase to $17.1 million plus the retained interest for ten years mentioned above. In either case, we also have an option to purchase only a four-acre portion of the leased land for $2 million, which may be exercised at any time in conjunction with the development of a hotel and which accordingly reduces the purchase price of the remaining land by $2 million. Bronco Billy's Lease through 2035 and Option to Purchase. Bronco Billy's leases certain parking lots and buildings, including a portion of the hotel and casino, under a long-term lease. The lease terms include an initial expiration date of January 2017, current rents of $18,500 per month, and six renewal options in three-year increments to 2035. Bronco Billy's recently exercised its first renewal option through January 2020, which increases the monthly rents to $25,000 for the first two years of the renewal period and $30,000 for the third year. The lease also contains a $7.6 million purchase option exercisable at any time during the lease and a right of first refusal. Corporate Office Lease. In August 2016, the Company executed a lease for 4,479 square feet of office space in Las Vegas, Nevada. The lease terms include a maturity date of 7.6 years and approximately $0.2 million of annual rents. The lease includes a tenant improvement allowance of $0.2 million. We are currently in the process of designing the space and anticipate moving in during mid-2017. Litigation In 2013 and 2014, we expended approximately $1.6 million to repair defects to the parking garage at the Silver Slipper Casino and Hotel. The parking garage was originally built in 2007, and we acquired the property in 2012. We hired outside legal counsel to pursue the reimbursement of such costs from the contractor and architect, who neglected to install certain structural elements required by the building codes. During the third quarter of 2015, the case was dismissed in favor of the defendants, as the statutes of repose had expired. We filed an appeal on November 2, 2015 on the basis that there were elements in the case that would have extended our right to seek reimbursement of the remedial costs. On November 25, 2015, we entered into a settlement and release agreement with the architect, and on January 12, 2016, we filed an appellate brief in the US Court of Appeals for the Fifth Circuit with respect to our litigation with the contractor. On August 31, 2016 oral arguments were heard and we expect the court to issue an opinion during the fourth quarter of 2016. We are party to a number of pending legal proceedings which occurred in the normal course of business. Management does not expect that the outcome of such proceedings, either individually or in the aggregate, will have a material effect on our financial position, cash flows or results of operations. |
EARNINGS (LOSS) PER SHARE |
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Earnings Per Share [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Earnings (Loss) Per Share | EARNINGS (LOSS) PER SHARE The weighted-average number of common and common equivalent shares used in the calculation of basic and diluted income per share consists of the following:
For the nine months ended September 30, 2016, all potentially dilutive securities, totaling 3.1 million shares, were excluded from the computation of diluted earnings per share as their effect was anti-dilutive due to the net loss recognized by the Company. For the three and nine months ended September 30, 2015, all 1.6 million potentially dilutive securities were excluded from the computation of diluted earnings per share as their effect would be anti-dilutive. |
SHARE-BASED INCENTIVE COMPENSATION |
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Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
SHARE-BASED INCENTIVE COMPENSATION | SHARE-BASED INCENTIVE COMPENSATION As of September 30, 2016, we had 443,756 share-based awards available for grant from the 2015 Equity Incentive Plan (the “2015 Plan”). In May 2016, the Company issued stock options to purchase 420,000 shares of our common stock to various employees of the Company, all of which have an exercise price of $1.70 per share, a price slightly higher than the Company's closing price on the day of grant. These stock options all vest in equal amounts over three years from the date of grant. The Company also issued stock options to purchase 74,116 shares of our common stock at an exercise price of $1.70 per share subject to a one-year vesting period, and 49,413 shares of common stock, which vested immediately, to members of our Board of Directors. The following table summarizes information related to our common stock options as of September 30, 2016:
We estimated the fair value of each stock option award on the grant date using the Black-Scholes valuation model. Option valuation models require the input of highly subjective assumptions. Changes in assumptions used can materially affect the fair value estimate. Option valuation assumptions for the options granted during the nine-month period ended September 30, 2016 included: an expected volatility range between 43.7% and 44.6%, an expected dividend yield of 0%, an expected life of 5.0 to 5.8 years, and an expected weighted-average risk-free rate of between 1.3% and 1.4%. Share-based compensation expense totaled $95,000 and $57,000, respectively, for the three months ended September 30, 2016 and 2015, and $315,000 and $285,000, respectively, for the nine months ended September 30, 2016 and 2015. As of September 30, 2016, there was approximately $0.8 million of unrecognized compensation cost related to unvested stock options previously granted by the Company. This unrecognized compensation cost is expected to be recognized over a weighted average period of 2.1 years. |
SEGMENT REPORTING |
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Segment Reporting [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
SEGMENT REPORTING | SEGMENT REPORTING We manage our casinos based on geographic regions within the United States. The casino/resort operations includes four segments; the Silver Slipper Casino and Hotel (Hancock County, Mississippi); Bronco Billy's Casino and Hotel (Cripple Creek, Colorado); the Rising Star Casino Resort (Rising Sun, Indiana); and the Northern Nevada segment, consisting of the Grand Lodge Casino (Incline Village, Nevada) and Stockman’s Casino (Fallon, Nevada). Bronco Billy's Casino and Hotel was included beginning May 13, 2016. The Company's management utilizes Adjusted Property EBITDA as the primary profit measure for its segments. Adjusted Property EBITDA is a non-GAAP measure defined as Adjusted EBITDA before corporate-related costs and expenses that are not allocated to each property. Adjusted EBITDA is a non-GAAP measure defined as earnings before interest and other non-operating income (expense), taxes, depreciation and amortization, pre-opening expenses, impairment charges, asset write-offs, recoveries, gain (loss) from asset disposals, project development and acquisition costs, and non-cash share-based compensation expense. Adjusted EBITDA and Adjusted Property EBITDA should not be construed as an alternative to operating income and net income for use as indicators of our performance; or as an alternative to cash flows from operating activities for use as a measure of liquidity; or as an alternative to any other measure determined in accordance with GAAP. We have significant uses of cash flows, including capital expenditures, interest payments, taxes and debt principal repayments, which are not reflected in Adjusted EBITDA and/or Adjusted Property EBITDA. Also, other companies in the gaming and hospitality industries that report Adjusted EBITDA and/or Adjusted Property EBITDA information may calculate Adjusted EBITDA or Adjusted Property EBITDA in a different manner. The following tables reflect selected operating information for our reporting segments for the three and nine months ended September 30, 2016 and 2015 and include a reconciliation of Adjusted Property EBITDA to operating income (loss) and net income (loss):
Selected balance sheet data is as follows:
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SUBSEQUENT EVENT |
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Subsequent Events [Abstract] | |
Subsequent Event | SUBSEQUENT EVENT On August 15, 2016, the Company announced a $5 million rights offering. A registration statement on Form S-3 relating to these securities was declared effective by the U.S. Securities and Exchange Commission on October 6, 2016. The rights offering commenced on October 7, 2016 and the Company distributed, at no charge, non-transferable subscription rights to the holders of the Company's common stock as of August 25, 2016. The Company closed on its rights offering on November 10, 2016. The Company received a total of $5 million of gross proceeds (or an estimated $4.7 million of net proceeds after offering costs) from the rights offering through the issuance of 3,846,154 shares of common stock at a price of $1.30 per share. The net proceeds from the rights offering will be used to partially fund certain capital expenditure growth projects at our existing properties, as well as for general corporate purposes. Of the 3,846,154 shares issued in connection with the rights offering, Daniel R. Lee, Chief Executive Officer, President and a director of the Company, purchased 1,000,000 shares as the standby purchaser in connection with the standby purchase agreement that the Company entered into with Mr. Lee on October 7, 2016. Under the standby purchase agreement, Mr. Lee agreed to hold such shares for a minimum period. |
BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES (Policies) |
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Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation. As permitted by the rules and regulations of the Securities and Exchange Commission, certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles in the United States of America (“GAAP”) have been condensed or omitted. These consolidated financial statements should be read in conjunction with the Company’s 2015 annual consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2015. The interim consolidated financial statements of the Company included herein reflect all adjustments (consisting of normal recurring adjustments) that are, in the opinion of management, necessary to present fairly the financial position and results of operations for the interim periods presented. The results of operations for the interim periods are not necessarily indicative of the results that may be expected for the entire year. The consolidated financial statements include the accounts of Full House and its wholly-owned subsidiaries. All material inter-company accounts and transactions have been eliminated. |
Fair Value Measurements | Fair Value Measurements. Fair value measurements affect our accounting for net assets acquired in acquisition transactions, share-based compensation, and certain financial assets and liabilities such as our common stock warrant liability. Our periodic assessments of long-lived tangible and intangible assets for possible impairment, including for property and equipment, goodwill, and other intangible assets, may also be affected by fair value measurements. Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date and is measured according to a hierarchy that includes: “Level 1” inputs, such as quoted prices in an active market for identical assets or liabilities; “Level 2” inputs, which are observable inputs for similar assets; or “Level 3” inputs, which are unobservable inputs. The Company utilizes Level 3 inputs when measuring net assets acquired in business combination transactions, subsequent assessments for impairment, and the estimated fair value of common stock warrants at issuance and for recurring changes in the related warrant liability (see Note 6). |
Income Taxes | Income Taxes. For interim income tax reporting, it was determined that the Company's annual effective tax rate could not be reasonably estimated at the present time. As a result, the actual year-to-date effective tax rate was used to determine the tax expense incurred during the three and nine months ended September 30, 2016 and 2015. |
Earnings (Loss) Per Share | Earnings (Loss) Per Share. Earnings (loss) per share is computed by dividing net income (loss) applicable to common stock by the weighted average number of common shares outstanding during the period. Diluted earnings per share reflects the additional dilution for all potentially-dilutive securities, including common stock options, warrants and unvested restricted shares, using the treasury stock method. |
Debt Issuance Costs | Debt Issuance Costs. In April 2015, the Financial Accounting Standards Board (the "FASB") issued Accounting Standards Update ("ASU") No. 2015-03, “Simplifying the Presentation of Debt Issuance Costs,” (“ASU 2015-03”), which is effective for fiscal years, and interim periods within those years, beginning after December 15, 2015. ASU 2015-03 requires debt issuance costs to be presented in the balance sheet as a direct deduction from the carrying value of the associated debt liability, consistent with the presentation of a debt discount. The amortization of such costs will continue to be reported as interest expense. Accordingly, the Company has adopted this accounting standard and reclassified the prior-period amounts to conform to the current-period presentation. |
Reclassifications | Reclassifications. Certain minor reclassifications have been made to prior period amounts to conform to the current-period presentation. Such reclassifications had no effect on the previously reported net income (loss) or retained earnings. |
Recently issued accounting standards | Recently Issued Accounting Standards. In February 2016, the FASB issued ASU No. 2016-02, “Leases (Topic 842),” (“ASU 2016-02”), which replaces the existing guidance in ASC 840, Leases. ASU 2016-02 is effective for fiscal years, and interim periods within those years, beginning after December 15, 2018. ASU 2016-02 requires a dual approach for lessee accounting under which a lessee would account for leases as finance leases or operating leases. Both finance leases and operating leases will result in the lessee recognizing a right-of-use (“ROU”) asset and a corresponding lease liability. The Company is currently assessing the impact that adoption of this guidance will have on its consolidated financial statements and footnote disclosures. Management believes that there are no other recently issued accounting standards not yet effective that are likely to have a material impact on our financial statements. |
ORGANIZATION (Tables) |
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Schedule of Real Estate Properties | We currently own and operate four casino properties and operate Grand Lodge Casino subject to a space lease. The following identifies the properties along with their dates of acquisition and locations:
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ACQUISITION (Tables) |
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Schedule of Recognized Identified Assets Acquired and Liabilities Assumed | The following table summarizes our preliminary estimates of the fair values of the assets acquired and liabilities assumed at the acquisition date:
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Business Acquisition, Pro Forma Information | The pro forma results do not include any anticipated synergies or other expected benefits from the acquisition.
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PROPERTY AND EQUIPMENT (Tables) |
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Sep. 30, 2016 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Property, Plant and Equipment [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of property and equipment | Property and equipment, including capital lease assets, consists of the following:
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LONG-TERM DEBT AND WARRANT LIABILITY (Tables) |
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Debt Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of long-term debt, net of current portion | Long-term debt, related discounts and issuance costs consists of the following:
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Schedule of first and second lien leverage ratio and fixed charge coverage ratio | These financial covenant ratios currently are as follows:
Additionally, the Fixed Charge Coverage Ratio as of the last day of any fiscal quarter shall not be less than 1.10x.
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EARNINGS (LOSS) PER SHARE (Tables) |
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Earnings Per Share [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Earnings Per Share, Basic and Diluted | The weighted-average number of common and common equivalent shares used in the calculation of basic and diluted income per share consists of the following:
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SHARE-BASED INCENTIVE COMPENSATION (Tables) |
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Sep. 30, 2016 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Share-based Compensation, Stock Options, Activity | The following table summarizes information related to our common stock options as of September 30, 2016:
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SEGMENT REPORTING (Tables) |
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Segment Reporting [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of selected statement of operations data | The following tables reflect selected operating information for our reporting segments for the three and nine months ended September 30, 2016 and 2015 and include a reconciliation of Adjusted Property EBITDA to operating income (loss) and net income (loss):
Selected balance sheet data is as follows:
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ORGANIZATION (Details) |
Sep. 30, 2016
Casino
|
---|---|
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Number of casinos owned | 4 |
ACQUISITION - Pro Forma Consolidated Statement of Operations (Details) - Bronco Billy's Casino and Hotel - USD ($) $ / shares in Units, $ in Thousands |
3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
Sep. 30, 2016 |
Sep. 30, 2015 |
Sep. 30, 2016 |
Sep. 30, 2015 |
|
Business Acquisition [Line Items] | ||||
Net revenues | $ 41,756 | $ 41,889 | $ 117,822 | $ 114,063 |
Net income (loss) | $ 208 | $ 3,144 | $ (3,213) | $ (949) |
Basic income (loss) per share (in USD per share) | $ 0.01 | $ 0.17 | $ (0.17) | $ (0.05) |
Diluted income (loss) per share (in USD per share) | $ 0.00 | $ 0.17 | $ (0.17) | $ (0.05) |
PROPERTY AND EQUIPMENT (Details) - USD ($) $ in Thousands |
Sep. 30, 2016 |
Dec. 31, 2015 |
---|---|---|
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | $ 152,860 | $ 135,205 |
Less accumulated depreciation | (41,631) | (36,223) |
Property and equipment, net of accumulated depreciation | 111,229 | 98,982 |
Land and improvements | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 13,699 | 12,657 |
Buildings and improvements | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 102,365 | 90,636 |
Furniture and equipment | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 36,348 | 31,899 |
Construction in progress | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | $ 448 | $ 13 |
LONG-TERM DEBT AND WARRANT LIABILITY - Long-term Debt (Details) - Line of Credit - USD ($) $ in Millions |
May 13, 2016 |
Mar. 31, 2016 |
---|---|---|
Capital One Bank | Term Loan | First Lien Credit Agreement | ||
Debt Instrument [Line Items] | ||
Maximum borrowing capacity | $ 45 | |
Capital One Bank | Revolving Loan | First Lien Credit Agreement | ||
Debt Instrument [Line Items] | ||
Maximum borrowing capacity | 2 | |
Abc Funding LLC | Term Loan | Second Lien Credit Agreement | ||
Debt Instrument [Line Items] | ||
Maximum borrowing capacity | 55 | $ 20 |
Proceeds from issuance of debt | $ 35 |
CAPITAL LEASE OBLIGATION (Detail Textuals) |
1 Months Ended | 9 Months Ended | 12 Months Ended | |||||
---|---|---|---|---|---|---|---|---|
Apr. 01, 2020
USD ($)
|
Mar. 16, 2016
USD ($)
|
Mar. 31, 2016
USD ($)
|
Sep. 30, 2016
USD ($)
Room
|
Mar. 31, 2020
USD ($)
|
Mar. 31, 2019
USD ($)
|
Mar. 31, 2018
USD ($)
|
Mar. 31, 2017
USD ($)
|
|
Rising Sun/Ohio County First, Inc | Rising Star Casino Resort | ||||||||
Capital Leased Assets [Line Items] | ||||||||
Number of hotel rooms | Room | 104 | |||||||
Project's actual cost | $ 7,700,000 | |||||||
Lease purchase option | 5,800,000 | |||||||
Option price at lease maturity | $ 1 | |||||||
Monthly payment per month | $ 77,537 | |||||||
Rising Sun/Ohio County First, Inc | Rising Star Casino Resort | Scenario, Forecast | ||||||||
Capital Leased Assets [Line Items] | ||||||||
Monthly payment per month | $ 54,326 | $ 63,537 | $ 57,537 | $ 56,537 | $ 48,537 | |||
Rising Star Casino Resort | ||||||||
Capital Leased Assets [Line Items] | ||||||||
Lease extension term | 4 years | |||||||
Lease amendment, minimum capital improvement requirement | $ 1,000,000 |
INCOME TAXES (Detail Textuals) |
3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
Sep. 30, 2016 |
Sep. 30, 2015 |
Sep. 30, 2016 |
Sep. 30, 2015 |
|
Income Tax Disclosure [Abstract] | ||||
Effective income tax rate for continuing operations | 56.90% | (42.10%) | (21.40%) | 74.30% |
Federal statutory income tax rate | 34.00% |
EARNINGS (LOSS) PER SHARE (Details) - USD ($) shares in Thousands, $ in Thousands |
3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
Sep. 30, 2016 |
Sep. 30, 2015 |
Sep. 30, 2016 |
Sep. 30, 2015 |
|
Numerator: | ||||
Net income (loss) attributable to Full House Resorts, Inc. - basic | $ 135 | $ 2,035 | $ (2,596) | $ (147) |
Change in fair value of warrants | (181) | 0 | 0 | 0 |
Net loss attributable to Full House Resorts, Inc. - diluted | $ (46) | $ 2,035 | $ (2,596) | $ (147) |
Denominator: | ||||
Weighted-average common share equivalents - basic (in shares) | 19,019 | 18,969 | 18,995 | 18,927 |
Potential dilution from share-based awards (in shares) | 195 | 0 | 0 | 0 |
Potential dilution from assumed conversion of warrants (in shares) | 112 | 0 | 0 | 0 |
Weighted-average common and common share equivalents - diluted (in shares) | 19,326 | 18,969 | 18,995 | 18,927 |
Antidilutive shares excluded from EPS calculation (in shares) | 1,600 | 3,100 | 1,600 |
SHARE-BASED INCENTIVE COMPENSATION - Summarizes information related to our common stock options (Details) - Stock options |
9 Months Ended |
---|---|
Sep. 30, 2016
$ / shares
shares
| |
Number of Stock Options | |
Options outstanding at January 1, 2016 (in shares) | 1,563,834 |
Granted (in shares) | 494,116 |
Exercised (in shares) | 0 |
Canceled/Forfeited (in shares) | 0 |
Options outstanding at September 30, 2016 (in shares) | 2,057,950 |
Options exercisable at September 30, 2016 (in shares) | 664,255 |
Weighted Average Exercise Price | |
Options outstanding at January 1, 2016 (in dollars per share) | $ / shares | $ 1.33 |
Granted (in dollars per share) | $ / shares | 1.70 |
Options outstanding at September 30, 2016 (in dollars per share) | $ / shares | 1.42 |
Options exercisable at September 30, 2016 (in dollars per share) | $ / shares | $ 1.31 |
SUBSEQUENT EVENT (Details) - USD ($) |
3 Months Ended | |
---|---|---|
Nov. 10, 2016 |
Aug. 15, 2016 |
|
Subsequent Event | Rights Offering | ||
Subsequent Event [Line Items] | ||
Gross proceeds from issuance of common stock | $ 5,000,000 | |
Net proceeds from issuance of common stock | $ 4,700,000 | |
Subscription price (in USD per share) | $ 1.30 | |
Stock issued during period (in shares) | 3,846,154 | |
Subsequent Event | Rights Offering, Standby Purchaser | ||
Subsequent Event [Line Items] | ||
Stock issued during period (in shares) | 1,000,000 | |
Right to Purchase Common Shares | ||
Subsequent Event [Line Items] | ||
Proposed rights offering amount | $ 5,000,000 |
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