Century Casinos, Inc. · NASDAQ:CNTY
Century Casinos — Q2 2023 Earnings Presentation
48 slides from Century Casinos's earnings presentation, Aug 8, 2023
Slide 1: Investor Presentation: Results through Q2 2023
INVESTOR PRESENTATION Peter Hoetzinger, Co CEO & President Results through Q2 2023
Slide 2: Forward-Looking Statements, Business Environment, Risk Factors & Notes on Presentation
Forward-Looking Statements, Business Environment, Risk Factors & Notes on Presentation This presentation may contain “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange
Slide 3: Key Investment Highlights
Key Investment Highlights Founded in 1992, Century Casinos is a multi-channel gaming company with focus on drive-to U.S. markets Casinos located in attractive markets with limited new competition risk Regional and local customer base. Majority of revenue comes from guests who live within a one
Slide 4: Multi-Channel North American Gaming Company
Multi-Channel North American Gaming Company1 Land-based Casinos (USA and Canada) The online world and the land-based casino world co-exist successfully. Racing and On/Off-Track Betting Give online customers a better experience and social excitement when they visit land- based casino properties. Spor
Slide 5: Century's North American Property Footprint
Century’s North American Property Footprint1 Diversified Local Gaming Footprint in Drive-to Markets 4 1. As of July 25, 2023.
Slide 6: Diverse Regional Exposure in Stable, Mature Gaming Markets in the U.S.
Diverse Regional Exposure in Stable, Mature Gaming Markets in the U.S. Exposure to attractive regional markets proven to be Colorado GGR resilient throughout the pandemic. – 2021 and 2022 GGR1 levels materially up versus $811 $828 $842 $834 $560 $976 $1,060 2019 across almost all markets served in
Slide 7: Stable Historical Performance of Regional GGR in the U.S.
Stable Historical Performance of Regional GGR in the U.S. US regional GGR has maintained stable growth since 2001 and is resilient to macroeconomic changes including oil prices and CPI U.S. Regional GGR ($bn) WTI Crude Oil Price (US$ / Barrel) CPI Index YoY % Change Sources: UNLV Gaming Research and
Slide 8: Broad Geographic and Asset Diversification
Broad Geographic and Asset Diversification No Single Property Accounts for More than 25% of Adjusted EBITDA # of Properties 19 Properties Acquisition of the Nugget and Rocky Gap (“Acquisitions”) is expected to significantly increase Century’s scale # of Slot Machines 7,575 On a pro forma basis,
Slide 9: Summary of Pro Forma Historical Financial Performance
Summary of Pro Forma1 Historical Financial Performance (in Millions) Key Highlights Revenue Stable revenue growth across Century, the Nugget $567 $608 and Rocky Gap with strong recovery post-COVID $78 $78 $413 $99 Consistent Adjusted EBITDA growth combined with $321 $377 $52 $100 margin expansio
Slide 10: Proven Track Record of Consistent Adjusted EBITDA Stability
Century Has a Proven Track Record of Consistent Adjusted EBITDA Stability and is Poised for Future Growth Decade plus of steady Adjusted EBITDA growth with attractive opportunities to accelerate growth with new acquisitions Pro 2012 - 2017 2018 - Present Forma1 Increased Canadian footprint through
Slide 11: Income Statement
Income Statement Selected information in USD, in millions except for per share Q2 2023 Q2 2022 Change Net Operating Revenue 136.8 111.1 +23% Earnings from Operations 18.6 20.8 -10% Net (Loss) Earnings Attributable to Century Casinos, Inc. Shareholders -2.0 8.9 -122% Adjusted EBITDA1 29.3 29.8 -2% Ba
Slide 12: Balance Sheet and Leverage
Balance Sheet and Leverage As of June 30, 2023 / Pro Forma1 5.0x 3.5x 4.9x Total Principal Debt to Adjusted Net Debt to Adjusted EBITDA less Lease Adjusted Net Leverage EBITDA less Lease Payments2 Lease Payments3 (8.0x)4 5.3x 2.6x 5.0x Pro Forma1 Total Principal Debt to Pro Forma1 Net Debt to Pro Fo
Slide 13: Environmental, Social and Governance: Century's Commitment
Environmental, Social and Governance (“ESG”) Century’s Commitment Environmental Social Responsibility Corporate Governance Century is committed to Century is involved with local Century created an ESG environmental responsibility in projects and charities in the Steering Committee to oversee the com
Slide 14: CNTY Consolidated Results
CNTY Consolidated Results 2019 – 2023 Quarterly Results (in USD, in millions) Net Operating Revenue 160 136.8 140 111.1 116.6112.6 120 103.1108.5 107.3103.8 92.2 95.7 100 87.7 84.8 80 72.4 67.2 60 52.4 52.9 45.6 36.1 40 20 0 Q1 Q2 Q3 Q4 2019 2020 2021 2022 2023 Adjusted EBITDA (1) 35.0 33.1 29.8 29.
Slide 15: Net Operating Revenue by Segment
Net Operating Revenue Q2 2023 by Reportable Segment and Operating Segment (1) (in USD) Canada 14% Canada 14% Midwest Poland 29% 17% Poland 17% East United States 21% 69% West 19% 1. Excludes the Corporate and Other Reportable Segment. 14
Slide 16: Adjusted EBITDA by Segment
Adjusted EBITDA (1) Q2 2023 by Reportable Segment and Operating Segment (2) (in USD) Canada 16% Poland Canada 6% 16% Poland Midwest 6% 46% West United States 20% 78% East 12% 1. Adjusted EBITDA is a non-GAAP financial measure. See Appendix for the definition and reconciliation of Adjusted EBITDA. 2.
Slide 17: U.S. Operations Overview
• East • Midwest U.S. OPERATIONS OVERVIEW • West
Slide 18: East Region Market Overview and Asset Summary
East Region Market Overview and Asset Summary West Virginia Asset Property Highlights Key Stats1 Mountaineer Casino is the area’s only full-service resort Casino Sq. Footage 72,380 and casino featuring world-class thoroughbred racing, an 18-hole golf course and 5,000-seat convention center Locat
Slide 19: East Region Results
East Region Results West Virginia Net Operating Revenue Adjusted EBITDA 1 35.0 7.0 31.7 30.6 6.2 30.4 29.7 5.9 30.0 28.7 6.0 28.2 26.3 26.7 26.5 5.3 4.9 25.0 23.9 5.0 4.5 4.3 3.9 3.9 20.0 4.0 3.6 3.5 15.0 3.0 10.0 2.0 5.0 1.0 0.0 0.0 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 2021 2022 2023 2021 2022 2023 1. Adjusted
Slide 20: Midwest Market Overview and Asset Summary
Midwest Market Overview and Asset Summary Colorado Asset Property Highlights Key Stats1 Central City is located just 45 minutes west of Denver, Casino Sq. Footage 22,640 Colorado Slot Machines 411 Easily accessible from highway I-70 Tables 8 Online sports betting through Tipico Sportsbook part
Slide 21: Midwest Region Market Overview and Asset Summary
Midwest Region Market Overview and Asset Summary Missouri Asset Property Highlights Key Stats1 Casino is situated in downtown Cape Girardeau Casino Sq. Footage 41,530 The property opened in October 2012 with the 13th and final gaming license in Missouri Slot Machines 833 Property includes an e
Slide 22: Midwest Region Results
Midwest Region Results Colorado and Missouri Net Operating Revenue Adjusted EBITDA 1 50.0 25.0 46.2 45.0 22.0 42.2 40.4 40.6 40.3 40.0 39.0 39.7 39.2 39.6 20.0 18.5 18.4 35.8 17.4 35.0 16.7 16.1 15.9 15.9 15.4 30.0 15.0 12.8 25.0 20.0 10.0 15.0 10.0 5.0 5.0 0.0 0.0 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 2021 2022
Slide 23: West Region Market Overview and Asset Summary
West Region Market Overview and Asset Summary Nevada Asset Property Highlights Key Stats1 The newly remodeled Nugget Casino is conveniently Casino Sq. Footage 71,200 located on route I-80 with easy access from the airport The full-service resort boasts a large gaming floor, two Slot Machines 919
Slide 24: Acquired July 25, 2023: Flintstone, Maryland
ACQUIRED JULY 25, 2023 FLINTSTONE, MARYLAND
Slide 25: Transaction Overview
Transaction Overview On July 25, 2023, Century acquired the operations of Rocky Gap Casino, Resort & Golf for $61.2mm. – Represents a purchase price multiple of 6.2x 2022 Adj. EBITDA (pro forma1 after lease payments to VICI). – Simultaneously, VICI acquired a related interest in the land and build
Slide 26: Rocky Gap Casino, Resort & Golf
Rocky Gap Casino, Resort & Golf Only casino resort in western Maryland, with over 10 million adults within a 100-mile radius 198 hotel rooms 630 slot machines 16 table games $10mm of property upgrades since 2018 remodeled rooms and suites new sports lounge renovation and upgrade of f
Slide 27: Rocky Gap, MD: Competitive Landscape
Rocky Gap, MD Competitive Landscape Property attracts local and destination drive-in customers from Maryland and surrounding states. 26
Slide 28: Additional Growth Drivers
• Cape Girardeau Hotel • Caruthersville Land-based ADDITIONAL GROWTH DRIVERS
Slide 29: Missouri Projects – Cape Girardeau Hotel
Century is Well-Positioned for the Next Stage of Growth Missouri Projects – Cape Girardeau Hotel Century commenced construction of a 69-room hotel at Cape Girardeau connected to the existing casino in September 2022. Project will transform the facility to a full resort destination with gaming, v
Slide 30: Missouri Projects – Caruthersville Temporary Land-Based Casino & Hotel
Century is Well-Positioned for the Next Stage of Growth Missouri Projects – Caruthersville Temporary Land-Based Casino & Hotel Originally, the casino operated on a riverboat and barge. Closed all games on the riverboat in October 2022 as it was no longer accessible due to record low water levels (
Slide 31: Missouri Projects – Caruthersville Permanent Land-Based Casino & Hotel
Century is Well-Positioned for the Next Stage of Growth Missouri Projects – Caruthersville Permanent Land-Based Casino & Hotel Groundbreaking on December 2, 2022. Expected opening in late 2024. 600 slot machines (with the possibility of an expansion for an additional 140), table games, a restaur
Slide 32: Thank You!
THANK YOU !
Slide 33: Appendix
APPENDIX
Slide 34: Earnings from Operations by Segment
Appendix Earnings from Operations – Q2 2023 by Reportable Segment and Operating Segment1 (in USD) Canada 20% Canada Poland 20% 5% Midwest Poland 52% 5% United States West 75% 19% East 4% 1. Excludes the Corporate and Other Reportable Segment. 33
Slide 35: Net Earnings Attributable to Shareholders by Segment
Appendix Net Earnings (Loss) Attributable to Century Casinos, Inc. Shareholders – Q2 2023 by Reportable Segment and Operating Segment1 (in USD) Canada 26% Canada 26% Midwest 50% Poland 7% Poland 7% United States 67% West 26% East -9% 1. Excludes the Corporate and Other Reportable Segment. 34
Slide 36: Abbreviations of Subsidiaries and Reporting Units
Appendix Abbreviations of Century Casinos, Inc. Subsidiaries and Certain Reporting Units Abbreviation Operating Segment Century Casino & Hotel – Central City CTL or Central City Midwest Century Casino & Hotel – Cripple Creek CRC or Cripple Creek Midwest Mountaineer Casino, Resort & Races MTR or Moun
Slide 37: Terms and Definitions
Appendix Terms and Definitions In this presentation, the term “USD” refers to US dollars, the term “CAD” refers to Canadian dollars and the term “PLN” refers to Polish zloty. Amounts presented are rounded. As such, rounding differences could occur in period-over-period changes and percentages report
Slide 38: Non-GAAP Financial Measures
Appendix Non-GAAP Financial Measures The Company supplements its consolidated financial statements prepared in accordance with US generally accepted accounting principles (“GAAP”) by using the following non-GAAP financial measures, which management believes are useful in properly understanding the C
Slide 39: Non-GAAP Financial Measures: Adjusted EBITDA Definition
Appendix Non-GAAP Financial Measures The Company defines Adjusted EBITDA as net earnings (loss) attributable to Century Casinos, Inc. shareholders before interest expense (income), net, income taxes (benefit), depreciation and amortization, non-controlling interests net earnings (loss) and transacti
Slide 40: Non-GAAP Financial Measures: Adjusted EBITDA less Lease Payments
Appendix Non-GAAP Financial Measures Adjusted EBITDA less Lease Payments is calculated by deducting the cash payments related to the Company’s Master Lease, CDR land lease and 50% of the lease payments from the Nugget to Smooth Bourbon (“Lease Payments”) from Adjusted EBITDA to calculate the debt an
Slide 41: Reconciliation of Adjusted EBITDA
Appendix Non-GAAP Financial Measures – Reconciliation of Adjusted EBITDA Century Casinos, Inc. For the three months ended March 31, in USD, in thousands 2023 2022 Net Operating Revenue $ 136,761 $ 111,122 Net (loss) earnings attributable to Century Casinos, Inc. shareholders (1,959) 8,856 Interest e
Slide 42: Reconciliation of Adjusted EBITDA, Year Ended December 31, 2022
Appendix Non-GAAP Financial Measures – Reconciliation of Adjusted EBITDA For the year ended December 31, 2022 Pro Forma Century Nugget Rocky Gap Property in USD, in thousands Casinos, Inc. Casino Resort Casino Resort EBITDA Net earnings $ 7,976 $ 1,984 $ 22,966 $ 32,926 Interest expense (income), ne
Slide 43: Reconciliation of Adjusted EBITDA by Region, Q2 2023
Appendix Non-GAAP Financial Measures – Reconciliation of Adjusted EBITDA For the three months ended June 30, 2023 Total United in USD, in thousands East Midwest West States Net (loss) income attributable to Century Casinos, Inc. shareholders (968) 5,391 2,829 7,252 Interest expense (income), net 2,1
Slide 44: Reconciliation of Adjusted EBITDA: Rocky Gap Casino Resort
Appendix Non-GAAP Financial Measures – Reconciliation of Adjusted EBITDA Rocky Gap Casino Resort1 For the year ended December 31, in USD, in thousands 2022 Net Operating Revenue $ 78,010 Net income 22,966 Interest expense, net 16 Depreciation and amortization 2,423 Change in non-cash lease expense (
Slide 45: Reconciliation of Quarterly Adjusted EBITDA
Appendix Non-GAAP Financial Measures – Reconciliation of Quarterly Adjusted EBITDA 2019 2020 2021 2022 2023 in USD, in millions Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Net earnings (loss) attributable to Century Casinos, Inc. shareholders $ 1.1 $ (0.6) $ 0.5 $ (20.1) $ (45.9) $ (12.6)
Slide 46: Reconciliation of Adjusted EBITDA and Adjusted EBITDA less Lease Payments
Appendix Non-GAAP Financial Measures – Reconciliation of Adjusted EBITDA and Adjusted EBITDA less Lease Payments (in thousands) Trailing-Twelve Year Ended Months Ended December 31, in USD, in thousands Q3 2022 Q4 2022 Q1 2023 Q2 2023 March 31, 2023 2022 Net earnings (loss) attributable to Century Ca
Slide 47: Calculation of Lease Adjusted Net Leverage and Lease Adjusted Leverage
Appendix Non-GAAP Financial Measures – Calculation of Lease Adjusted Net Leverage and Lease Adjusted Leverage Trailing Twelve Trailing Twelve Months ended Rocky Gap Canada Real Months ended (1) June 30, 2023 Acquisition Estate Sale (2) June 30, 2023 in dollars, in millions Current (PENDING) PRO FORM
Slide 48: Reconciliation of Net Debt
Appendix Non-GAAP Financial Measures – Reconciliation of Net Debt Amounts in thousands June 30, 2023 ############# Total long-term debt, including current portion $ 348,597 $ 349,580 Deferred financing costs 15,496 16,844 Total principal $ 364,093 $ 366,424 Less: Cash and cash equivalents $ 108,595