Monarch Casino & Resort, Inc. · NASDAQ:MCRI
Monarch Casino & Resort — Q3 2022 Earnings Presentation
26 slides from Monarch Casino & Resort's earnings presentation, November 2022
Slide 1: Investor Presentation
Investor Presentation November 2022
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: Monarch Casino & Resort, Inc. (MCRI) Highlights
Monarch Casino & Resort, Inc. (MCRI) Highlights Prime locations and assets • Atlantis Casino Resort Spa is located in the more affluent area of south Reno, 3 miles south of downtown, connected by a bridge to the Reno-Sparks Convention Center • Monarch Casino Resort Spa is the first property encounte
Slide 4: Company History
Company History 2008 Phase IV – Atlantis • Expansion of the 2022 1994 1999 casino including: Atlantis 1991 Phase II - Atlantis Phase III - Atlantis • Large race and • ~61,000 square feet of Phase I – Atlantis • Second high-rise tower • Third high-rise tower sports book casino space • First high-rise
Slide 5: Atlantis Casino Resort Spa Reno
Atlantis Casino Resort Spa Reno
Slide 6: Atlantis Overview
Atlantis Overview Award-winning facility • AAA - “Four Diamond” rating • 2022 TripAdvisor - Rated #1 Reno resort for 8 consecutive years with 4 of our restaurants ranked in the top 10 in the city • 2022 Forbes: • Four-Star Award for Spa Atlantis for 7 consecutive years (only four-star venue in Reno)
Slide 7: Atlantis Market Share
18% Atlantis Market Share 16% 16.5% 14% MCRI market share (TTM) Atlantis Casino Resort Spa has consistently outperformed the greater Reno-Sparks market for the last 25 years 12% • Primary focus has always been providing best-in-class and best-in-market 10% experiences, amenities, and service 8% Prop
Slide 8: Atlantis Hotel Occupancy and Cash ADR
Atlantis Hotel Occupancy and Cash ADR Total Occupancy Cash ADR1 90% $160 83% 84% $150 $149 $140 $140 80% $140 71% $122 70% $118 64% 64% $120 60% 53% $100 50% $80 40% $60 30% $40 20% 10% $20 0% $0 2020 2021 3Q22 LTM 2020 2021 3Q22 LTM Atlantis Reno-Sparks Atlantis Reno-Sparks Return of leisure and gr
Slide 9: Fast-Growing Reno Metro Market
Fast-Growing Reno Metro Market Population of ~500,000 • Reno metro’s population has grown 17.0% from 2010 to 2021 (national average: 7.5%) • 2020 per capita personal income for the Reno metro area was 11% higher than the national average ($66,075 vs. $59,510) • Gaming environment remains extremely c
Slide 10: Atlantis’ Prime Location
Silver Legacy Circus Circus Rail City Western Village Ramada Reno Atlantis’ Prime Location Downtown Nugget Eldorado Club Cal Neva Baldini’s Ideally located in the heart of south Reno’s restaurant, shopping Grand Sierra and convention district Boomtown Reno, Gold Dust West & • ~3 miles south of downt
Slide 11: Monarch Casino Resort Spa Black Hawk
Monarch Casino Resort Spa Black Hawk
Slide 12: Monarch Black Hawk Overview
Monarch Black Hawk Overview Monarch Casino Resort Spa’s amenities include: • 23-story luxurious tower with 516 hotel rooms (20% suites) • ~60,000 square foot casino • ~1,100 slot machines • ~40 table games • 14 poker tables • Keno • Company managed sports book, lounge and bar • World-class spa and p
Slide 13: Black Hawk-Central City Market
50-mile radius Black Hawk-Central City Market Market consists of: • 21 casinos • 7,938 slot machines Boulder • 166 table games • 49 poker tables • 1,651 hotel rooms spread across seven gaming facilities Black Hawk Denver Population of ~3 million within a 50-mile radius of Black Hawk • The Denver met
Slide 14: Monarch Market Share
Monarch Market Share1 30% 27.2% 25% Monarch Casino Resort Spa has consistently grown market share MCRI market share (TTM) over the past seven years 20% • 3Q22 LTM market share was an all-time record at 27.2% 15% • Represents an increase of 1,920 basis points compared to market share of 8.0% at the t
Slide 15: Prime Property Location
Slot count Z Casino > 600 300 to 600 Sasquatch Bull Durham < 300 Prime Property Location Saratoga Gilpin Wild Card Saloon Red Dolly Ameristar First property encountered by visitors arriving from Denver and Monarch The Lodge Casino Resort other major population centers via Highway 119 (as pictured) B
Slide 16: Denver Metro Area Provides Significant Air Traffic to Las Vegas
Denver Metro Area Provides Significant Air Traffic to Las Vegas Top Las Vegas Feeder Markets (2019 Originating Passengers in Thousands) 1,800 1,600 1,565 1,521 1,400 1,200 1,000 815 800 690 671 636 600 510 502 477 444 400 200 0 Los Angeles San Francisco Chicago Seattle Dallas Denver New York Washing
Slide 17: Growth Initiatives
Growth Initiatives
Slide 18: Sports Betting
Sports Betting Company owns & operates its sports book • Atlantis Race and Sports mobile app launched in Nevada in 2015 • BetMonarch mobile app launched in Colorado in May 2020 as one of the state’s first mobile sports betting operators • Low operating cost structure and existing player database hav
Slide 19: Balance Sheet Management
Balance Sheet Management As of September 30, 2022: $33.1 million of cash $27 million principal balance on existing Term Loan No borrowings outstanding under $70 million Revolving Credit Facility Monarch owns substantially all of its real estate and is not subject to material rent payments
Slide 20: Strong Growth Profile
Strong Growth Profile Near term organic growth: • Elimination of betting limits in Colorado on 5/1/21 • Completion of Black Hawk expansion project in Q1 2022 • Strong economic tailwinds in both Reno and Denver metro areas • Significant population growth in both markets Substantial free cash flow wit
Slide 21: Financial Results
Financial Results
Slide 22: Historical Financial Performance
Historical Financial Performance $600 40% Acquired Colorado Monarch Black Hawk gaming license starts phased opening April 2012 November 2020 35% $500 30% $400 25% $ in millions $300 20% 15% $200 10% $100 5% $0 0% 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 3Q22 LTM Net Revenue $
Slide 23: Historical Net Leverage Ratio
Historical Net Leverage Ratio Net Leverage Ratio 4.0x 3.5x 3.5x 3.0x Total Net Debt/LTM Adjusted EBITDA1 2.5x 2.2x 2.0x 1.7x 1.5x 1.3x 1.1x 1.0x 0.7x 0.5x 0.6x 0.5x 0.4x 0.4x 0.4x 0.0x 0.0x -0.1x 0.0x -0.5x 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 3Q22 LTM Source: Monarch Cas
Slide 24: Income Statement Overview
Income Statement Overview Monarch Casino & Resort reported all-time quarterly Three Months Ended record financial results in Q3 2022 September 30, $ in 000s, except per share 2022 2021 Increase data and percentages Net revenue $133,727 $111,630 19.8% Net income(1) 27,493 22,314 23.2% Adjusted EBITDA
Slide 25: Balance Sheet Overview
Balance Sheet Overview $ in 000s September 30, 2022 December 31, 2021 Cash and cash equivalents $33,139 $33,526 Net property and equipment 581,183 580,807 Other assets 74,343 76,126 Total assets $688,665 $690,459 Long-term debt (including $26,237 $88,152 current maturities) Other liabilities 147,058
Slide 26: Adjusted EBITDA Reconciliation
Adjusted EBITDA Reconciliation Three Months Ended September 30, $ in 000s 2022 2021 Adjusted EBITDA(1) $51,694 $40,279 Expenses: Stock based compensation (1,257) (572) Depreciation and amortization (11,183) (9,434) Provision for income taxes (7,993) (5,835) Interest expense (870) (891) Construction
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