-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, LoAOqI8iV9pPkdh94cYeafzrXKHc4++xdMiB62x+I1X+MxR1PE9bLLDCuiTaLYaE rzLUSrcuVRrS48wiGj6zqA== 0000907242-06-000033.txt : 20060427 0000907242-06-000033.hdr.sgml : 20060427 20060427120014 ACCESSION NUMBER: 0000907242-06-000033 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 20060426 ITEM INFORMATION: Results of Operations and Financial Condition FILED AS OF DATE: 20060427 DATE AS OF CHANGE: 20060427 FILER: COMPANY DATA: COMPANY CONFORMED NAME: MONARCH CASINO & RESORT INC CENTRAL INDEX KEY: 0000907242 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-MISCELLANEOUS AMUSEMENT & RECREATION [7990] IRS NUMBER: 880300760 STATE OF INCORPORATION: NV FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 000-22088 FILM NUMBER: 06783881 BUSINESS ADDRESS: STREET 1: 1175 W MOANA LANE STREET 2: STE 200 CITY: RENO STATE: NV ZIP: 89509 BUSINESS PHONE: 7758253355 MAIL ADDRESS: STREET 1: 1175 W MOANA LANE STREET 2: STE 200 CITY: RENO STATE: NV ZIP: 89509 8-K 1 q106earn8k.txt UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 ---------------------- FORM 8-K CURRENT REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934 Date of Report (Date of earliest event reported): April 26, 2006 MONARCH CASINO & RESORT, INC. (Exact name of registrant as specified in its charter) NEVADA 0-22088 88-0300760 (State or other jurisdiction (Commission (I.R.S. Employer of incorporation) File Number) Identification No.) 1175 W. Moana Lane, Suite 200 Reno, NEVADA 89509 (Address of Principal Executive Offices) (Zip Code) (775)825-3355 ---------------------------------------------------- (Registrant's telephone number, including area code) NOT APPLICABLE ---------------------------------------------------- (Former name or former address, if changed since last report) ITEM 2.02 Results of Operations and Financial Condition On April 26, 2006, Monarch Casino & Resort, Inc. (the "Company") issued a press release reporting the Company's financial results for the first quarter ended March 31, 2006. A copy of the press release is attached hereto as Exhibit 99.1 and incorporated herein by reference. ITEM 9.01 Financial Statements and Exhibits (c) EXHIBITS 99.1 Text of press release dated April 26, 2006. -2- SIGNATURE Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. MONARCH CASINO & RESORT, INC. Date: April 27, 2006 By: /s/ Ben Farahi ------------------------------- Name: Ben Farahi Title: Chief Financial Officer, Treasurer and Secretary -3- Exhibit 99.1 PRESS RELEASE NEW RECORD FIRST QUARTER RESULTS FOR MONARCH CASINO - EBITDA (1) IMPROVES 15.5%, DILUTED EPS INCREASES 25.0% DESPITE IMPLEMENTATION OF SFAS 123R - RENO, NV-April 26, 2006- Monarch Casino & Resort, Inc. (Nasdaq: MCRI) (the "Company"), owner of the Atlantis Casino Resort in Reno, Nevada, today announced record financial results for its first quarter ended March 31, 2006. The Company reported EBITDA (1) of $9.5 million, a 15.5% improvement over the $8.2 million EBITDA (1) reported for the first quarter of 2005. The improved EBITDA (1) beat published consensus analysts' estimate of $9.2 million and was the result of record first quarter net revenues of $35.6 million and better operating margins. The Company's operating margin for the period improved to 20.6% of net revenues from 19.6% of net revenues during the same period a year earlier. The record revenues were driven by a 15.4% increase in casino revenue, an 8.0% increase in both food and beverage and hotel revenues, and a 4.0% improvement in other revenues. Record first quarter 2006 net income of $4.8 million is a 23.7% increase from first quarter 2005 net income of $3.9 million and translates into earnings per diluted share (EPS) of $0.25 versus $0.20 for the same period last year. The Company's first quarter 2006 diluted EPS beat the published consensus analysts' estimate of $0.24. The Company achieved record results despite implementing the requirements of SFAS 123R in the first quarter of 2006. The Company booked approximately $548,000 in additional pre-tax equity compensation expense during the quarter as a result of implementing the provisions of SFAS 123R, which went into effect January 1, 2006. SFAS 123R requires fair value measurement and recognition in the financial statements for all share-based compensation arrangements. Excluding this share based compensation expense, the Company's reported after-tax earnings would have been $0.27 per diluted share for the first quarter 2006, which would have been a 35% increase from the $0.20 diluted EPS reported in the first quarter 2005. Had SFAS 123R been in effect during the first quarter 2005, pre-tax expenses for that period would have increased by approximately $252,000. Also during the first quarter of 2006, the Company became debt free, having paid off the $8.1 million December 31, 2005 balance on its revolving credit facility. $24 million remains available to be drawn down under the revolving credit facility should the Company require such funds. John Farahi, Monarch's CEO and Co-Chairman commended his team for the positive results: "Our management continues to do a fabulous job of making the Atlantis one of the premier properties in northern Nevada. As a result, we benefit from the frequent repeat business of our established guests, and also attract fresh patronage from first time visitors, as well as locals who are new to the area. Circumstances that allow us to thrive and continue to be the foundation of our success are our location, strong local economy and the quality of the product and services we provide. But it is the vibrant hospitality, attention to detail, and tireless effort of our team members that maximize our potential. One measure of our success is our continuing strong -4- flow through: This quarter we produced an increase to our net revenues by almost thirteen percent, yet our promotional allowances increased by less than eight percent." Mr. Farahi also observed: "Being debt free gives our Board even greater opportunity to explore corporate growth opportunities. At the same time, we continue work on our Atlantis expansion plans which are in the preliminary design phase." Monarch Casino & Resort, Inc., through its wholly-owned subsidiary, owns and operates the tropically-themed Atlantis Casino Resort in Reno, Nevada. The Atlantis is the closest hotel-casino to, and is directly across the street from, the Reno-Sparks Convention Center. The Atlantis is recognizable due to its Sky Terrace, a unique structure rising approximately 55 feet above street level and spanning 160 feet across Virginia Street with no intermediate support pillars. The Sky Terrace connects the Atlantis to a 16-acre parcel of land owned by the Company, that is compliant with all casino zoning requirements and is suitable and available for future expansion of the Atlantis facilities and is currently being used by the Company as additional paved parking for the Atlantis. The existing Atlantis site offers almost 1,000 guest rooms in three contiguous high-rise hotel towers and a motor lodge. The tropically-themed Atlantis features approximately 51,000 square feet of high-energy casino space with 38 table games and approximately 1,450 slot and video poker machines, a sports book, Keno and a poker room, and offers a variety of dining choices in the form of nine high-quality food outlets. This press release contains forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934 which are subject to change, including, but not limited to, comments relating to (i) future operating performance, and (ii) future expansion plans. The actual results may differ materially from those described in any forward-looking statements. Additional information concerning potential factors that could affect the Company's financial results is included in the Company's Securities and Exchange Commission filings, which are available on the Company's web site. Contacts: Ben Farahi at (775) 825-3355 or benfarahi@monarchcasino.com Karl G. Brokmann at (775) 825-3355 or kbrokmann@monarchcasino.com For additional information including artist renditions and photographs, visit Monarch's web site at monarchcasino.com. (1) "EBITDA" consists of net income plus provision for income taxes, interest expense, and depreciation and amortization. EBITDA should not be construed as an alternative to operating income (as determined in accordance with generally accepted accounting principles) as an indicator of the Company's operating performance, or as an alternative to cash flows from operating activities (as determined in accordance with generally accepted accounting principles) as a measure of liquidity. This item enables comparison of the Company's performance with the performance of other companies that report EBITDA, although some companies do not calculate this measure in the same manner and therefore, the measure as presented may not be comparable to similarly titled measures presented by other companies. -5- MONARCH CASINO & RESORT, INC. CONDENSED CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)
Three Months Ended March 31, ---------------------------- 2006 2005 ------------ ------------ (Unaudited) (Unaudited) Revenues Casino...................................... $ 24,124,047 $ 20,901,908 Food and beverage........................... 9,744,817 9,026,336 Hotel....................................... 6,033,935 5,588,152 Other....................................... 1,090,576 1,048,337 ------------ ------------ Gross revenues........................... 40,993,375 36,564,733 Less promotional allowances................. (5,387,714) (5,002,031) ------------ ------------ Net revenues............................. 35,605,661 31,562,702 ------------ ------------ Operating expenses Casino...................................... 8,012,162 7,534,847 Food and beverage........................... 4,790,771 4,437,365 Hotel....................................... 2,103,723 2,027,873 Other....................................... 314,454 321,646 Selling, general, and administrative........ 10,841,486 8,809,293 Gaming development expense.................. 43,765 204,398 Depreciation and amortization............... 2,146,758 2,038,200 ------------ ------------ Total operating expenses................. 28,253,119 25,373,622 ------------ ------------ Income from operations................... 7,352,542 6,189,080 Other expense Interest expense............................ (59,444) (305,374) ------------ ------------ Income before income taxes............... 7,293,098 5,883,706 Provision for income taxes.................... 2,525,000 2,030,000 ------------ ------------ Net income............................... $ 4,768,098 $ 3,853,706 ============ ============ Earnings per share of common stock Net income Basic..................................... $ 0.25 $ 0.20 Diluted................................... $ 0.25 $ 0.20 Weighted average number of common shares and potential common shares outstanding Basic................................... 18,885,595 18,816,819 Diluted................................. 19,252,277 19,043,546
-6- MONARCH CASINO & RESORT, INC. CONDENSED CONSOLIDATED BALANCE SHEETS
March 31, December 31, 2006 2005 ------------- ------------- (Unaudited) ASSETS Current assets Cash............................................ $ 12,010,163 $ 12,886,494 Receivables, net................................ 3,091,337 3,559,602 Federal income tax refund receivable............ - 286,760 Inventories..................................... 1,458,070 1,456,453 Prepaid expenses................................ 2,537,300 2,401,619 Deferred income taxes........................... 1,518,152 1,326,224 ------------- ------------- Total current assets......................... 20,615,022 21,917,152 ------------- ------------- Property and equipment Land............................................ 10,339,530 10,339,530 Land improvements............................... 3,166,107 3,166,107 Buildings....................................... 78,955,538 78,955,538 Building improvements........................... 10,398,814 10,398,814 Furniture and equipment......................... 68,826,326 67,393,755 Leasehold improvement........................... 1,346,965 1,346,965 ------------- ------------- 173,033,280 171,600,709 ------------- ------------- Less accumulated depreciation and amortization.. (78,138,462) (76,117,346) ------------- ------------- Net property and equipment................... 94,894,818 95,483,363 ------------- ------------- Other assets, net................................. 269,524 269,524 ------------- ------------- Total assets................................. $ 115,779,364 $ 117,670,039 ============= ============= LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities Accounts payable................................ 6,761,798 7,335,630 Accrued expenses................................ 7,590,609 8,722,221 Federal income taxes payable.................... 2,548,782 - ------------- ------------- Total current liabilities.................... 16,901,189 16,057,851 Long-term debt, less current maturities........... - 8,100,000 Deferred income taxes............................. 5,747,192 5,953,193 Commitments and contingencies..................... Stockholders' equity Preferred stock, $.01 par value, 10,000,000 shares authorized; none issued................. - - Common stock, $.005 par value, 30,000,000 shares authorized; 19,072,550 shares issued; 18,885,595 outstanding at 03/31/2006, 18,879,310 outstanding at 12/31/2005........... 190,726 190,726 Additional paid-in capital...................... 18,630,715 17,882,827 Treasury stock, 177,974 shares at 03/31/2006, 193,240 shares at 12/31/2005, at cost......................... (652,875) (708,877) Retained earnings............................... 74,962,417 70,194,319 ------------- ------------- Total stockholders' equity................... 93,130,983 87,558,995 ------------- ------------- Total liabilities and stockholders' equity... $ 115,779,364 $ 117,670,039 ============= =============
-7- MONARCH CASINO & RESORT, INC. RECONCILIATION OF NET INCOME TO EBITDA (1)
Three Months Ended March 31, ----------------------- 2006 2005 (unaudited) (unaudited) ----------- ----------- Net income......................... $4,768,098 $3,853,706 Adjustments: Provision for income taxes....... 2,525,000 2,030,000 Interest expense................. 59,444 305,374 Depreciation and amortization.... 2,146,758 2,038,200 ----------- ----------- EBITDA (1) $9,499,300 $8,227,280 =========== ===========
(1) "EBITDA" consists of net income plus provision for income taxes, interest and stockholder guarantee fee expense, and depreciation and amortization. EBITDA should not be construed as an alternative to operating income (as determined in accordance with generally accepted accounting principles) as an indicator of the Company's operating performance, or as an alternative to cash flows from operating activities (as determined in accordance with generally accepted accounting principles) as a measure of liquidity. This item enables comparison of the Company's performance with the performance of other companies that report EBITDA, although some companies do not calculate this measure in the same manner and therefore, the measure as presented may not be comparable to similarly titled measures presented by other companies. -8- -----END PRIVACY-ENHANCED MESSAGE-----