Monarch Casino & Resort, Inc. · NASDAQ:MCRI

Monarch Casino & Resort — Investor Presentation (March 2018)

32 slides from Monarch Casino & Resort's investor presentation, March 2018

1. Slide 1: Investor Presentation

   Investor Presentation March 2018

2. 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,” “

3. Slide 3: Company Overview

   Company Overview

4. Slide 4: Summary

   Summary  Excellent economic fundamentals in both Reno and Black Hawk markets  Significant and diverse business investment in Reno  Denver economy is one of the nation’s strongest  Monarch’s properties have the premier locations in both markets  Hands-on, results-oriented management with strong

5. Slide 5: Regional Summary

   Regional Summary Reno, NV  Atlantis has been continually upgraded and expanded in recent years  Investment of over $95 million completed in 2009  Toucan Charlie’s Buffet recently redesigned and upgraded  Added 300 new surface parking spaces  Minimal forward maintenance capex requirements Black

6. Slide 6: Historic Milestones

   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 142 rooms and a

7. Slide 7: Positive Market Characteristics for the Reno Market

   Positive Market Characteristics for the Reno Market Reno Gazette-Journal – “Industrial Park that Houses Tesla Gigafactory Nearly Sold Out After Blockchains Deal” “Blockchains LLC, is purchasing 64,000 acres at the Tahoe-Reno Industrial Center…The deal leaves only 250 acres of the 104,000-acre indust

8. Slide 8: Positive Market Characteristics for the Denver Market

   Positive Market Characteristics for the Denver Market The Denver Post – “Metro Denver Home Sales and Prices Hit New High in 2017; Inventory at Record Low ” “The uptick in the number of sales combined with higher prices pushed the total sales volume over $25 billion, up from $22.2 billion in 2016, $2

9. Slide 9: Atlantis Casino Resort Spa

   Atlantis Casino Resort Spa

10. Slide 10: Property Overview

    Property Overview  Opened in 1991  Fresh, award-winning facility  USA Today Travel - #1 casino outside Las Vegas  AAA - “Four Diamond” rating  Forbes - Four-Star Award for Spa Atlantis  Only venue in Northern Nevada with this rating  TripAdvisor - Consistently rated #1 Reno resort; boasts #1

11. Slide 11: Positioned Near More Affluent South Reno Communities

    Positioned Near More Affluent South Reno Communities  Ideal location in heart of south Reno’s restaurant, shopping and convention district  ~3 miles south of downtown in more affluent area  ~3 miles from Reno-Tahoe International Airport  Close to Reno’s main north/south artery, Highway 395  ~40

12. Slide 12: Reno Market Growth Drivers

    Reno Market Growth Drivers  Reno’s economy historically centered on gaming and entertainment but is diversifying to a broader base including healthcare, manufacturing, distribution and technology industries as well as a variety of entrepreneurial startups  Tesla Motors announced the construction o

13. Slide 13: Atlantis Casino Market Share

    Atlantis Casino Market Share  Over the last 21 years, Atlantis 300% 17% has continued to outperform the greater Reno-Sparks market 14.8% 250% 15% by focusing on providing best- Indexed gaming revenue (1996=0%) in-class experiences, amenities, 200% 13% and service MCRI market share 150% 11%  Since

14. Slide 14: Atlantis Hotel Occupancy and Cash ADR

    Atlantis Hotel Occupancy and Cash ADR1 Total Occupancy Cash ADR 100% $140 89.7% 89.3% 88.6% 90% $120 $117.03 $110.77 80% $105.55 71.8% $102.25 69.1% $99.22 68.3% $100 70% $92.10 60% $80 50% $60 40% 30% $40 20% $20 10% 0% $0 2015 2016 2017 2015 2016 2017 Reno-Sparks Atlantis Reno-Sparks Atlantis Atla

15. Slide 15: Monarch Casino Black Hawk

    era gl a Sa == T = Monarch Casino Black Hawk

16. Slide 16: Property Overview

    Property Overview  Acquired in April 2012  Existing facility redesigned and upgraded from June 2012 to August 2015  Broke ground on hotel tower and casino expansion in January 2017 Property Amenities  32,000 square foot casino with ~756 slots and 14 tables  Buffet restaurant and snack bar  Par

17. Slide 17: Property Location

    Property Location  ~35 miles west of Denver, ~35 miles southwest of Boulder, ~20 miles west of Golden and ~77 miles east of Vail  Property is strategically located at the entrance to Main Street, Black Hawk’s primary access road and Black Hawk casino district  First property encountered by visito

18. Slide 18: Black Hawk Gaming Market

    Black Hawk Gaming Market  15 casinos Property Level Detail  7,131 slot machines Property Location Slots1 Tables1 Rooms2 Ameristar (PNK) Black Hawk 1,191 40 536  157 table games Isle of Capri (ERI) Black Hawk 1,034 25 238 The Lodge (JACENT) Black Hawk 968 25 50  Only four casinos offer more Monar

19. Slide 19: Monarch Black Hawk Market Share

    Monarch Black Hawk Market Share  Monarch Casino Black Hawk MCRI and Black Hawk Indexed Gaming Revenue Growth market share has dramatically 70% 13.0% increased since the acquisition 12.7% Indexed gaming revenue (2012 Q1=0%) 60% 12.5% Black Hawk 12.0% MCRI market share (TTM) construction  TTM market

20. Slide 20: Rationale for Further Investment in Black Hawk

    Rationale for Further Investment in Black Hawk  Denver metro area is an attractive target market  Population of more than 3 million  Median household income of $71,926 is 25% above the national average  Top 20% of personal income growth among all MSAs in nation  Third largest supplier of air tr

21. Slide 21: Black Hawk Market Underserved by Hotel Rooms

    Black Hawk Market Underserved by Hotel Rooms 2017 Gross Gaming Revenue per Hotel Room $1,000 $890 $900 $800 $700 $629 $ in 000s $600 $500 $400 $300 $184 $200 $115 $78 $60 $100 $47 $43 $0 Black Hawk has the highest GGR per hotel room nationwide at $629K, and is second only to Macau GGR per hotel room

22. Slide 22: Black Hawk Market Performance

    Black Hawk Total Gaming Revenue Black Hawk Market Performance $700 $650 $621 $610 Annual revenue ($ in millions) $596 $600 $581 $24 $559 $559 $561 $554 $551 $553 $550 $532 $22 $90 $524 $524 $530 $85 $22 $80 $20 $506 $21 $509 $61 $65 $500 $19 $44 $62 $66 $70 $478 $25 $19 $557 $533 $524 $531 $505 $503

23. Slide 23: Ameristar Black Hawk Case Study

    Ameristar Black Hawk Case Study Annual Adjusted EBITDA and Capital Spend for Ameristar Black Hawk1 $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 $20.9 $21.9 $20 $10 $6.7 $1.0 $0 2

24. Slide 24: Existing Facility Upgrades

    Existing Facility Upgrades Original Cabaret Stage Phase 1 Phase 2 Phase 3 24

25. Slide 25: Hotel Tower/Casino Expansion

    Hotel Tower/Casino Expansion New Parking Structure  9-story garage now open  Increases on-site parking from ~500 spaces to ~1,500 spaces Hotel Tower/Casino Expansion  Groundbreaking held in February 2017  Project to include:  23-story tower with approximately 500 hotel rooms  Nearly double the

26. Slide 26: Hotel Tower/Casino Expansion

    Hotel Tower/Casino Expansion Current Facility Expansion Rendering New Parking Structure Hotel Tower/Casino Expansion: Current Progress 26

27. Slide 27: Hotel Tower/Casino Expansion

    Hotel Tower/Casino Expansion South View Rendering Exterior Pool Rendering Interior Pool Rendering 27

28. Slide 28: Monarch Black Hawk Master Plan Budget and Timeline

    Monarch Black Hawk Master Plan Budget and Timeline Budget Total Spent Through Left to Estimated Cost December 31, 2017 Spend Completion Date $ in millions I. Existing Facility Monarch Casino Black Hawk (1) $76 $76 - Completed Interior completed; Existing Facility Upgrade (2)(3) $34-$36 $23 $11-$13 E

29. Slide 29: Monarch Consolidated Results

    Monarch Consolidated Results

30. Slide 30: Income Statement

    Income Statement $250 27% Black Hawk acquired 04/26/12 26% $200 25% 24% $150 $ in millions 23% $100 22% 21% $50 20% $0 19% 2010 2011 2012 2013 2014 2015 2016 2017 Net Revenue $136.4 $134.5 $163.3 $188.7 $187.8 $202.2 $217.0 $230.7 Adj. EBITDA $29.5 $29.3 $36.2 $48.5 $43.5 $50.0 $55.7 $58.0 EBITDA Ma

31. Slide 31: Strong Balance Sheet

    Strong Balance Sheet Total Debt Leverage Ratio $90 2.5x $81.1 2.2x $80 2.0x 1.9x Total Debt/LTM Adjusted EBITDA $70 $60 $53.8 1.5x $ in millions $48.5 $50 $46.3 $40.9 1.1x 1.1x $40 1.0x 1.0x 0.8x 0.8x $28.6 $30 $26.2 $26.2 $24.7 $20 0.5x 0.5x 0.5x $10 $0 0.0x 2009 2010 2011 2012 2013 2014 2015 2016

32. Slide 32: Summary

    Summary  Optimally positioned in two of the most robust macroeconomic markets in the country, with 2017 same store Y/Y gaming revenue growth of 5.8%  Monarch has upgraded and expanded Atlantis through more than $95 million of investment over the last few years  Property requires minimal forward m

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