Monarch Casino & Resort, Inc. · NASDAQ:MCRI
Monarch Casino & Resort — Investor Presentation (September 2016)
31 slides from Monarch Casino & Resort's investor presentation, September 2016
Slide 1: Investor Presentation September 2016
Investor Presentation Atlantis Casino Resort Spa in Reno, NV Monarch Casino in Black Hawk, CO September 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 markets
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 completed in 2009 Recently completed redesign and upgrade of Toucan Charlie’s Buffet Added additional 300 surface parking spaces Minimal forward maintenance cap
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) Award-winning facility Named 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
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 ~40 acres covering both sides of S. Virginia St. provides opportunity for future deve
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: 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% greater Reno-Sparks 200% 13% MCRI market share market by focusing on providing best-in-class 150% 11% experiences, 100%
Slide 14: 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 14
Slide 15: 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 ~716 slots and 14 tables
Slide 16: 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 17: Black Hawk Gaming Market
Monarch Casino Black Hawk Black Hawk Gaming Market 17 casinos Property Level Detail 7,733 slot machines Property Location Slots1 Tables1 Rooms2 Ameristar (PNK) Black Hawk 1,217 40 536 155 table games Isle of Capri (ISLE) Black Hawk 1,082 27 238 Only four casinos offer more than The Lodge (JA
Slide 18: Black Hawk Market Share
Monarch Casino Black Hawk Monarch Black Hawk Market Share Monarch Casino Black Hawk market share has increased MCRI and Black Hawk Indexed Gaming Revenue Growth since the acquisition 45% 12.0% 11.6% Indexed gaming revenue (2012 Q1=0%) 40% Black Hawk 11.5% Market share (TTM) increased 35% constru
Slide 19: 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 20: 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 21: Black Hawk Market Performance
Monarch Casino Black Hawk Black Hawk Total Gaming Revenue1 Black Hawk Market Performance $700 $650 Annual revenue ($ in millions) $605 $596 $600 $581 $554 $24 $559 $559 $561 $551 $553 $550 $532 $22 $530 $524 $524 $83 $22 $80 $20 $506 $21 $509 $61 $65 $500 $19 $44 $62 $66 $70 $478 $25 $19 $557 $533 $
Slide 22: 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 guest service area Work left to complete: Exterior upgrade to match expansion 22
Slide 23: Existing Facility Upgrade
Monarch Casino Black Hawk Existing Facility Upgrade Original Cabaret Stage Phase 1 Phase 2 Phase 3 23
Slide 24: New Parking Structure and Hotel Tower/Casino Expansion
Monarch Casino Black Hawk New Parking Structure and Hotel Tower/Casino Expansion New Parking Structure 9-story garage expected to be completed in 3Q16 Increases on-site parking from ~500 spaces to ~1,500 spaces Remaining cost as of June 30, 2016 of approximately $3-$6 million Company expects
Slide 25: New Parking Structure and Hotel Tower/Casino Expansion
Monarch Casino Black Hawk New Parking Structure and Hotel Tower/Casino Expansion Current Parking Structure New Parking Structure: Current Progress Current Facility Expansion Rendering 25
Slide 26: New Parking Structure and Hotel Tower/Casino Expansion
Monarch Casino Black Hawk New Parking Structure and Hotel Tower/Casino Expansion South View Rendering Exterior Pool Rendering Interior Pool Rendering 26
Slide 27: 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 27
Slide 28: 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 Q2 LTM Net Revenue $136.4 $134.5 $163.3 $188.7 $187.8 $202.2 $209.4 Adj. EBITDA $29.5 $29.3 $36.2
Slide 29: 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 $35.0 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 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: Conclusion Summary
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 maintenance capex
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