Monarch Casino & Resort, Inc. · NASDAQ:MCRI
Monarch Casino & Resort — Investor Presentation (May 2016)
34 slides from Monarch Casino & Resort's investor presentation, May 2016
Slide 1: Investor Presentation May 2016
Investor Presentation Atlantis Casino Resort Spa in Reno, NV Monarch Casino in Black Hawk, CO May 2016
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) Company Overview 2) Atlantis Casino Resort Spa 3) Monarch Casino Black Hawk 4) Monarch Consolidated Results 5) Conclusion 3
Slide 4: Company Overview: Summary
Company Overview Summary Excellent economic fundamentals in both Reno and Black Hawk markets Significant influx of business to Reno led by Tesla’s $5 billion battery factory Denver economy remains among the nation’s strongest Monarch’s properties have the premier locations in both the Reno a
Slide 5: Company Overview: Regional Summary
Company Overview Regional Summary Reno, NV Atlantis has been upgraded and expanded in recent years Investment of over $95 million in 2009 Recently completed redesign of Toucan Charlie’s Buffet Additional surface parking expected to open in 2Q16 Minimal forward capex requirements Black Hawk
Slide 6: Historic Milestones
Company Overview 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 Rivier
Slide 7: Positive Market Characteristics for the Reno Market
Company Overview Positive Market Characteristics for the Reno Market Reno Yahoo Finance – “$1B Switch Data Center Near Reno Will be World’s Biggest” – January 16, 2015 Departures Magazine – “Reno-Vation: The Biggest Little City in the World is proving that America is ready to start making things aga
Slide 8: Positive Market Characteristics for the Denver Market
Company Overview Positive Market Characteristics for the Denver Market Denver Denver OED – “In 2014, Downtown Denver received over $1 billion of development investment, including 482 hotel rooms, 1,148 residences, 275,000 sq. ft. of office space and 170,000 sq. ft. of retail. Looking forward, 20 pro
Slide 9: Table of Contents
Table of Contents 1) Company Overview 2) Atlantis Casino Resort Spa 3) Monarch Casino Black Hawk 4) Monarch Consolidated Results 5) Conclusion 9
Slide 10: Atlantis Property Overview
Atlantis Casino Resort Spa Property Overview Opened in 1991 Facility is very fresh ($95 million upgrade completed in 2009) Identified in March 2015 by USA Today Travel as the #1 casino outside Las Vegas Awarded AAA’s “Four Diamond Rating” in August 2012 (received by fewer than 5% of AAA’s ra
Slide 11: Positioned Near More Affluent South Reno Communities
Atlantis Casino Resort Spa Positioned Near More Affluent South Reno Communities Located ~3 miles south of downtown in the generally more affluent area of Reno and ~3 miles from Reno- Tahoe International Airport Near freeway on South Virginia Street, the main north/south artery in Reno Ideal lo
Slide 12: Reno Growth Drivers
Atlantis Casino Resort Spa Reno Growth Drivers Reno’s economy was historically centered on gaming and entertainment but has recently diversified to a broader base including the healthcare, manufacturing and technology industries as well as a variety of entrepreneurial startups Tesla Motors annou
Slide 13: Reno Growth Drivers: Jobs, Unemployment, Housing
Atlantis Casino Resort Spa Reno Growth Drivers EDAWN Jobs1 EDAWN Prospects2 EDAWN jobs announced surged on heels of Tesla’s indication of interest EDAWN prospective site visits remain strong Includes 700 Tesla jobs 15 5,000 4,179 4,000 3,460 10 3,000 5-year Average 2,231 2014 Average 2015 Average 2,
Slide 14: Atlantis Casino Market Share
Atlantis Casino Resort Spa Atlantis Casino Market Share Over the last 18 years, 300% 17% Atlantis has continued Indexed gaming revenue (1996=0%) to outperform the 250% 14.5% 15% Reno-Sparks market 200% 13% MCRI market share by focusing on providing best-in-class 150% 11% experiences, 100% 9% ameni
Slide 15: Opportunity to Further Improve Atlantis Hotel Performance
Atlantis Casino Resort Spa Opportunity to Further Improve Atlantis Hotel Performance Total Occupancy Cash ADR 100% $120 88.7% 89.7% 89.5% 90% $102.25 $104.52 $98.91 $100 $93.31 80% $92.10 $86.25 66.9% 68.3% 68.3% 70% $80 60% 50% $60 40% $40 30% 20% $20 10% - $0 2014 2015 2016 Q1 LTM 2014 2015 2016 Q
Slide 16: Table of Contents
Table of Contents 1) Company Overview 2) Atlantis Casino Resort Spa 3) Monarch Casino Black Hawk 4) Monarch Consolidated Results 5) Conclusion 16
Slide 17: Monarch Casino Black Hawk Property Overview
Monarch Casino Black Hawk Property Overview Acquired in April 2012 Existing facility redesigned and upgraded from June 2012 to August 2015 Zoning approval received for master plan of expansion and conversion to resort Property Amenities 32,000 square foot casino with ~719 slots and 14 tables
Slide 18: Black Hawk Property Location
Monarch Casino Black Hawk Property Location Black Hawk, CO is located ~35 miles west of Denver (3.0 million people), ~35 miles southwest of Boulder, ~20 miles west of Golden and ~77 miles east of Vail Monarch Black Hawk is strategically located at the entrance to Main Street, Black Hawk’s primar
Slide 19: Black Hawk Gaming Market
Monarch Casino Black Hawk Black Hawk Gaming Market 17 casinos Property Level Detail 7,865 slot machines Property Location Slots1 Tables1 Rooms2 Ameristar (PNK) Black Hawk 1,290 40 536 152 table games Isle of Capri (ISLE) Black Hawk 1,075 25 238 Only five casinos offer more than The Lodge (JA
Slide 20: Black Hawk Market Share
Monarch Casino Black Hawk Monarch Black Hawk Market Share Monarch Casino Black Hawk market share (TTM) has MCRI and Black Hawk Indexed Gaming Revenue Growth increased since the 40% 12.0% acquisition Indexed gaming revenue (2012 Q1=0%) 35% Black Hawk 11.5% construction 11.0% MCRI market share (TTM)
Slide 21: Rationale for Further Investment in Black Hawk
Monarch Casino Black Hawk Rationale for Further Investment in Black Hawk Denver metro area is an attractive target market Population of more than 3 million Household income in Denver MSA of $58,732 is 17% above national average Top 20% of personal income growth among all MSAs in nation Thi
Slide 22: Ameristar Black Hawk Case Study
Monarch Casino Black Hawk 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 $2
Slide 23: Black Hawk Market Performance
Monarch Casino Black Hawk Black Hawk Total Gaming Revenue1 Black Hawk Market Performance $700 $650 Annual revenue ($ in millions) $603 $596 $600 $581 $554 $24 $559 $559 $561 $551 $553 $550 $532 $22 $530 $524 $524 $82 $22 $80 $20 $506 $21 $509 $61 $65 $500 $19 $44 $62 $66 $70 $478 $25 $19 $557 $533 $
Slide 24: Master Plan Budget and Timeline
Monarch Casino Black Hawk Master Plan Budget and Timeline $ in millions Total Spent Through Cost Left to Spend Expected Completion Date March 31, 2016 I. Existing Facility Riviera Black Hawk Casino (1) $76 $76 - Completed Interior completed; Existing Facility Upgrade (2)(3) $34-$36 $18 $16-$18 Exter
Slide 25: Existing Facility Upgrade
Monarch Casino Black Hawk Existing Facility Upgrade Interior upgrades completed All aspects of the casino redesigned and upgraded New buffet New front entrance New bar/cabaret lounge New customer service area Work left to complete: Exterior upgrade to match expansion Remaining cost
Slide 26: Existing Facility Upgrade Phases
Monarch Casino Black Hawk Existing Facility Upgrade Original Cabaret Stage Phase 1 Phase 2 Phase 3 26
Slide 27: New Parking Structure and Hotel Tower/Casino Expansion
Monarch Casino Black Hawk New Parking Structure and Hotel Tower/Casino Expansion New Parking Structure Completion of construction expected late in 2Q16 9-story garage to increase on-site parking from ~500 spaces to ~1,500 spaces Remaining cost as of March 31, 2016 of approximately $7-$10 milli
Slide 28: Parking Structure and Expansion: Current Progress
Monarch Casino Black Hawk New Parking Structure and Hotel Tower/Casino Expansion Current Parking Structure New Parking Structure: Current Progress Current Facility Expansion Rendering 28
Slide 29: Expansion Renderings
Monarch Casino Black Hawk New Parking Structure and Hotel Tower/Casino Expansion South View Rendering Exterior Pool Rendering Interior Pool Rendering 29
Slide 30: Table of Contents
Table of Contents 1) Company Overview 2) Atlantis Casino Resort Spa 3) Monarch Casino Black Hawk 4) Monarch Consolidated Results 5) Conclusion 30
Slide 31: Consolidated Results: Income Statement
Monarch Consolidated Results Income Statement $250.0 27.0% Black Hawk acquired 26.0% 04/26/12 $200.0 25.0% 24.0% $150.0 23.0% $100.0 22.0% 21.0% $50.0 20.0% $0.0 19.0% 2010 2011 2012 2013 2014 2015 2016 Q1 LTM Net Revenue $136.4 $134.5 $163.3 $188.7 $187.8 $202.2 $204.8 Adj. EBITDA $29.5 $29.3 $36.2
Slide 32: Strong Balance Sheet Position
Monarch Consolidated Results Strong Balance Sheet Position Total Debt Leverage Ratio $90.0 2.5x $81.1 2.2x $80.0 2.0x 1.9x $70.0 Total Debt/LTM Adjusted EBITDA $60.0 $53.8 $48.5 1.5x $50.0 $46.3 $40.9 1.1x 1.1x $40.0 $35.4 1.0x 1.0x $28.6 0.8x 0.8x $30.0 $24.7 0.7x $20.0 0.5x $10.0 $0.0 0.0x 2009 20
Slide 33: Table of Contents
Table of Contents 1) Company Overview 2) Atlantis Casino Resort Spa 3) Monarch Casino Black Hawk 4) Monarch Consolidated Results 5) Conclusion 33
Slide 34: Conclusion
Conclusion Summary Reno area attracting strong, diversified, long-term investment led by planned $5 billion Tesla battery factory Monarch has upgraded and expanded Atlantis through more than $95 million of investment over the last few years Property requires minimal forward capex Strong Blac
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