Monarch Casino & Resort, Inc. · NASDAQ:MCRI
Monarch Casino & Resort — Shareholder Meeting (May 2013)
38 slides from Monarch Casino & Resort's shareholder meeting presentation, May 10, 2013
Slide 1: Annual Stockholder Presentation – May 10, 2013
Annual Stockholder Presentation – May 10, 2013 Atlantis Casino Resort Spa in Reno, Nevada Riviera Black Hawk Casino in Black Hawk, Colorado 1
Slide 2: Forward-looking information
Forward-looking information This presentation contains certain forward-looking information that generally can be identified by the context of the statement or the use of forward-looking terminology, such as “believes,” “estimates,” “anticipates,” “intends,” “expects,” “plans,” “is confident that,” “
Slide 3: Table of contents
Table of contents 1) Monarch company history 2) Riviera Black Hawk Review 3) Atlantis Review 4) Monarch Consolidated Results 5) Conclusion 6) Questions and Answers 3
Slide 4: Company history: organizational chart
Company history Organizational chart1 Monarch Casino & Resort, Inc. Golden Road Motor Inn, Inc. Monarch Growth Inc. Atlantis Casino Resort Spa Monarch Black Hawk, Inc. HoldCo Riviera Black Hawk Casino Sub Owned property 1) Does not show non-operating subsidiaries. 4
Slide 5: Company history: historic milestones
Company history Historic milestones 1970s 1980s 1990s 2000s 2010s 1972: Golden Door Motel 1993: Initial stock offering raises Phase IV - Atlantis Acquisition of Riviera Black Hawk purchased by the Farahi family: $17mm of expansion capital 2008 Q2: When the most recent 2012 Q2: Acquisition of Riviera
Slide 6: Table of contents
Table of contents 1) Monarch company history 2) Riviera Black Hawk Review 3) Atlantis Review 4) Monarch Consolidated Results 5) Conclusion 6) Questions and Answers 6
Slide 7: Acquisition transaction summary
Riviera Black Hawk Acquisition transaction summary Transaction closed April 26, 2012 Purchase price of $76.0mm cash ($73.9mm net after $2.1mm of cash) Funded by new $100mm revolving credit facility TTM Adjusted EBITDA at time of transaction announcement was $10.3mm which represents a 7.2x purchase m
Slide 8: Black Hawk financial review
Black Hawk(1) financial review Income statement Net Revenue Adjusted EBITDA (2) $12.9 $50 Quarterly $ in millions $42.0 $12 Annual $ in millions Annual $ in millions $9 $40 $39.8 $39.3 $17 $10.0 $10 $8.9 $7 $30 $8 $9.6 $29.4 $11.6 $4.0 $5 $12 $6 $20 $10.0 $2.6 $3 $4 $12.6 $3.3 $10 $7 $2 $1 2010 2011
Slide 9: Local metropolitan area population
Riviera Black Hawk Local metropolitan area population Black Hawk / Central City Black Hawk is located 35 miles west of the Denver metro area (2.6 million people1), 35 miles southwest of Boulder, 20 miles west of Golden, and 77 miles east of Vail2 Source: 1) US Census Bureau (www.census.gov); Denver
Slide 10: Black Hawk-Central City gaming market
Riviera Black Hawk Black Hawk-Central City gaming market Commentary Property level detail 1 1 2 Property Location Slots Tables Rooms Comprised of 26 casinos Ameristar Black Hawk 1,466 47 536 Isle of Capri (ISLE) Black Hawk 1,080 35 238 10,258 slot machines and 246 table The Lodge (JACENT) Black Hawk
Slide 11: Black Hawk gaming market
Riviera Black Hawk Black Hawk gaming market Slot count > 700 Bullwhackers 500 to 700 Wild Card Saloon < 500 Bull Durham Black Hawk Station Ameristar Entrance To Black Hawk Central City Market Fitzgeralds Golden Riviera Canyon Mardi Gras Grand Plateau Gilpin Red Dolly The Lodge Golden Lady Luck Gates
Slide 12: Black Hawk-Central City market performance
Riviera Black Hawk Black Hawk-Central City market performance Black Hawk-Central City total gaming revenue1 $700 $350 $661 $650 $27 $633 $629 $625 $300 $619 $604 $25 Annual revenue ($ in millions) YTD revenue ($ in millions) $594 $600 $69 $577 $577 $25 $576 $66 $67 $250 $21 $556 $23 $48 $27 $550 $53
Slide 13: Black Hawk-Central City vs. Reno-Sparks market performance
Riviera Black Hawk Black Hawk-Central City vs. Reno-Sparks market performance Black Hawk-Central City vs. Reno-Sparks total gaming revenue The Black Hawk-Central $1,200 City market has $1,000 increased, while Reno- $ in millions $800 Sparks has decreased $600 $400 The two markets were $200 approxima
Slide 14: Gaming revenue per unit comparison
Riviera Black Hawk Black Hawk-Central City vs. Reno-Sparks gaming revenue per unit Slots WPD $200 $142 $143 $145 $150 $128 $133 Slot WPD $98 $94 $93 $94 $93 $100 $50 $0 2008 2009 2010 2011 2012 Black Hawk-Central City Reno-Sparks Table games WPD (excl player banked poker) $1,000 Pre $843 $825 $789 $
Slide 15: Market overview
Riviera Black Hawk Market overview Consideration Commentary 35 miles to Denver metro area (2.6 million people1) No tribal casino competition two tribal in southwest CO 350 to 400 miles drive time from Denver Desirable regional market Denver metro area median household income of $59K; 17% higher than
Slide 16: Market overview
Riviera Black Hawk Market overview Consideration Commentary Among leading facilities in Single-level gaming floor seamlessly connected to six-floor parking garage Black Hawk Fourth largest casino in Black Hawk-Central City by number of slots Low tax rate structure; gaming revenue taxed on a graduate
Slide 17: Master development expansion plan
Riviera Black Hawk Master development expansion plan The master development plan: Nearly double the existing casino space 507 room hotel tower Resort quality spa and pool facility Four restaurants and additional bars Ten story parking structure; 1,551 total spaces Approved by Black Hawk City Council
Slide 18: Current facility
Riviera Black Hawk Current facility 18
Slide 19: Redesigned rendering
Riviera Black Hawk Redesigned rendering 19
Slide 20: Current facility
Riviera Black Hawk Current facility 20
Slide 21: Redesigned rendering
Riviera Black Hawk Redesigned rendering 21
Slide 22: Redesigned rendering
Riviera Black Hawk Redesigned rendering 22
Slide 23: Redesigned rendering
Riviera Black Hawk Redesigned rendering 23
Slide 24: Significant EBITDA gains at Ameristar Black Hawk
Riviera Black Hawk Significant EBITDA gains at Ameristar Black Hawk Annual adjusted EBITDA and capital spend for Ameristar Black Hawk $70 Casino Hotel Smoking Amendment remodel construction ban 50 begins commences & $58.8 $60 $56.0 Hotel opens $53.0 Adj EBITDA ($ in millions) $50 $40 $35.5 $28.8 $30
Slide 25: Table of contents
Table of contents 1) Monarch company history 2) Riviera Black Hawk Review 3) Atlantis Review 4) Monarch Consolidated Results 5) Conclusion 6) Questions and Answers 25
Slide 26: Atlantis expansion and upgrade
Company history Atlantis expansion and upgrade Facility is very fresh and was recently expanded and upgraded $95 million of capital improvements completed in 2009 Awarded AAA’s “Four Diamond Rating” in August 2012 (less than 5% of AAA rated properties achieve “Four Diamond”) The new amenities have b
Slide 27: New amenity highlights
Company history New amenity highlights Established as one of the finest restaurants in northern Nevada Atlantis Steakhouse Established as a locals favorite Manhattan Deli & Popular with local business and community leaders Restaurant 2012 write was 31% higher than 2009 (opened Q3 2008) Race & sports
Slide 28: Atlantis financial review
Atlantis financial review Income statement Net Revenue Adjusted EBITDA (1) $150 $150 $35 $33.5 $30 $33.3 Quarterly $ in millions Annual $ in millions Annual $ in millions Quarterly $ in millions $145 $142.0 $140.6 $140.9 $25 $31.1 $140 $100 $30 $20 $135 $15 $130 $34.9 $36.0 $50 $7.8 $9.3 $25 $10 $12
Slide 29: Atlantis financial review: RevPAR drivers
Atlantis financial review RevPAR drivers Occupancy1 100% 84.1% 87.8% 86.2% 84.1% 62.0% 65.2% 63.7% 59.7% 50% 0% 2010 2011 2012 YTD Q1 2013 MCRI Reno-Sparks ADR1,2 $90 $84.39 $85 $80.31 $80 $75.47 $74.83 $77.01 $75.00 $74.56 $75 $72.30 $70 $65 2010 2011 2012 YTD Q1 2013 MCRI Reno-Sparks Occupancy and
Slide 30: The Reno-Sparks market: competitors
The Reno-Sparks market The competitors: recent developments Heavy promotional environment in Reno-Sparks Downtown properties losing share to Atlantis and Peppermill Increased competition from central California casinos Red Hawk casino opened in December 2008 2,000 slots, 75 tables, no hotel rooms ne
Slide 31: The Reno-Sparks market: competitors (cont'd)
The Reno-Sparks market The competitors: recent developments (cont’d) Red Fox Existing Sherwood Valley Colusa Coyote Valley Robinson Proposed Pinoleville (on reservation) Konocti Vista Enterprise Sho-Ka-Wah Twin Pine Thunder Valley Proposed (off reservation) River Rock Cache Creek Red Hawk Under Cons
Slide 32: Atlantis market share
The Reno-Sparks market Atlantis market share MCRI and Reno-Sparks indexed gaming revenue growth Over the last 17 years, 300% 17% Atlantis construction disruption 16.1% Atlantis has continued from 2007 Q3 to 2008 Q2 to outperform the 250% 15% Indexed gaming revenue (1996=0%) Reno-Sparks market by foc
Slide 33: Table of contents
Table of contents 1) Monarch company history 2) Riviera Black Hawk Review 3) Atlantis Review 4) Monarch Consolidated Results 5) Conclusion 6) Questions and Answers 33
Slide 34: Monarch consolidated results
Monarch consolidated results Income statement Net Revenue Adjusted EBITDA (1) Black hawk acquired 04/26/12 $170.4 $150 $40 $50 Annual $ in millions Quarterly $ in millions Quarterly $ in millions Annual $ in millions $36.2 $40 $160 $142.0 $140.6 $100 $35 $30 $140 $29.5 $29.3 $20 $34.9 $47.6 $50 $30
Slide 35: Strong balance sheet position
Atlantis financial review Strong balance sheet position Total debt LTM leverage ratio1 $100 2.5x $90 $81.1 2.0x $80 2.0x 1.9x $71.8 1.7x $70 Total debt / adjusted EBITDA $60 1.5x $ in millions $48.5 $50 $40 1.0x 1.0x $28.6 0.8x $30 $24.7 $20 0.5x $10 $0 2009 2010 2011 2012 2013 Q1 0.0x 2009 2010 201
Slide 36: Table of contents
Table of contents 1) Monarch company history 2) Riviera Black Hawk Review 3) Atlantis Review 4) Monarch Consolidated Results 5) Conclusion 6) Questions and Answers 36
Slide 37: Conclusion
Conclusion Summary Strong results out of Black Hawk during our first year of ownership (increased Adjusted EBITDA by 43%) Difficult market conditions to continue in Northern Nevada due to: recessionary macroeconomic factors and continued heavy promotional environment in local market We have upgraded
Slide 38: Table of contents
Table of contents 1) Monarch company history 2) Riviera Black Hawk Review 3) Atlantis Review 4) Monarch Consolidated Results 5) Conclusion 6) Questions and Answers 38
Monarch Casino & Resort — Shareholder Meeting (May 2013) on 6ix