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Boyd Gaming reports Q4, Full Year 2014 results13 February 2015LAS VEGAS, Nevada -- (PRESS RELEASE) -- Boyd Gaming Corporation (BYD) today reported financial results for the fourth quarter and full year ended December 31, 2014. Boyd Gaming reported fourth quarter 2014 net revenues of $531.6 million, an increase of 1.4% compared to pro forma net revenues of $524.4 million for the same quarter in 2013. Total Adjusted EBITDA(1) was $136.4 million, up 10.6% from the comparable pro forma amount of $123.3 million for the year-ago period. Effective September 30, 2014, the Company deconsolidated Borgata and is accounting for its 50% investment in Borgata by applying the equity method for periods subsequent to that date. The prior-year pro forma amounts reflect the results for Borgata on a comparable equity method basis to the current period presentation. Keith Smith, President and Chief Executive Officer of Boyd Gaming, said: "In the fourth quarter we were pleased to achieve EBITDA growth and margin improvement in every segment of our business. We saw modest revenue gains throughout our portfolio, continued growth in our Las Vegas business and ongoing stabilization in our regional markets. We also made steady progress executing our strategy to enhance our non-gaming amenities, which contributed to improved growth and profitability in the quarter. Additionally, we continued to strengthen our balance sheet during the quarter, bringing total debt reduction to nearly $200 million in 2014. The second half of 2014 provided encouraging signs of growth and a solid base for continuing to build long-term shareholder value." Adjusted Earnings(1) for the fourth quarter 2014 reflect a loss of $0.1 million, break even on a per share basis, compared to a loss of $26.4 million, or $0.24 per share, for the same period in 2013. The calculations of Adjusted Earnings, Adjusted Earnings per share, and pro forma results reflecting Borgata on a comparable basis for all periods are presented in tables at the end of this press release. On a GAAP basis, the Company reported a net loss of $32.4 million, or $0.29 per share, for the fourth quarter 2014, compared to a net loss of $47.3 million, or $0.43 per share, for the year-ago period. During the fourth quarter of 2014, Boyd Gaming reported impairment charges of $40.6 million, primarily due to impairments of intangible assets. Results for the prior-year period included a pretax loss on early extinguishments of debt of $24.7 million, primarily due to the redemption of certain debt at Borgata. These charges are not included in Adjusted Earnings or Adjusted Earnings per share. Key Operations Review Las Vegas Locals In the Las Vegas Locals segment, fourth-quarter 2014 net revenues rose 2.1% to $151.7 million, compared to $148.6 million in the year-ago period. Fourth-quarter 2014 Adjusted EBITDA was $39.8 million, an increase of 19.7% from $33.2 million in the fourth quarter of 2013, marking the seventh quarter of EBITDA growth in the last two years. Gaming revenues were up slightly, while targeted capital investments in new amenities helped drive growth in non-gaming revenues. Results also reflect the Company's ability to drive operating efficiencies, as EBITDA margins improved year-over-year. Downtown Las Vegas In the Downtown Las Vegas segment, net revenues were $59.6 million in the fourth quarter of 2014, down slightly from $59.8 million in the year-ago period. Adjusted EBITDA was $13.1 million, increasing approximately $2 million year-over-year after excluding one-time adjustments in the fourth quarter of 2013. Results benefitted from strength in Hawaiian visitation and increased pedestrian traffic on Fremont Street. Midwest and South; Peninsula In the Midwest and South segment, net revenues were $200.0 million, an increase of 2.0% from $196.0 million in the fourth quarter of 2013. Adjusted EBITDA was $40.1 million, a year-over-year increase of $9.7 million, or 31.8%, after excluding a one-time tax adjustment in the fourth quarter of 2013. During the fourth quarter of 2014, the Peninsula segment reported net revenues of $120.2 million, a slight increase from $119.9 million in the year-ago period. Adjusted EBITDA was $42.2 million, up 2.9% from $41.0 million in the fourth quarter of 2013. EBITDA growth in these segments was broad-based, as 10 out of 12 of the Company's regional properties posted year-over-year EBITDA gains, including strong performances at Delta Downs and Kansas Star. While favorable weather contributed to revenue gains, increased operating efficiencies created positive flow-through to EBITDA, as operating margins improved by more than 300 basis points. Borgata Borgata reported fourth quarter 2014 net revenues of $179.1 million ? including $7.0 million from its online gaming operations – a 14.0% increase from the $157.1 million in revenues reported in the year-ago period. Adjusted EBITDA at Borgata more than doubled to $36.0 million, compared to $16.4 million in the fourth quarter of 2013. Due to its deconsolidation, the Company now applies the equity method of accounting to its investment in Borgata. The Company's share of Borgata's Adjusted EBITDA was $18.0 million for the fourth quarter of 2014 as compared to pro forma Adjusted EBITDA of $8.2 million for the prior-year period. Borgata saw significant growth in both gaming and non-gaming business during the quarter. The property set all-time market share records for gross gaming revenue, table win, slot win and poker during the fourth quarter, and achieved solid growth in its hotel and meetings business. Borgata also continued to enhance the profitability of its online gaming operations, generating $1.8 million in EBITDA from this business in the fourth quarter. Full Year 2014 Results For the full year ended December 31, 2014, Boyd Gaming reported pro forma net revenues of $2.14 billion, compared to $2.20 billion in pro forma net revenues reported for the year-ago period. Total pro forma Adjusted EBITDA was $545.3 million, compared to $550.8 million in the prior year. Adjusted Earnings for the year ended December 31, 2014, were $1.3 million, or $0.01 per share, compared to a loss of $33.4 million, or $0.34 per share, for the year ended December 31, 2013. On a GAAP basis, Boyd Gaming reported a net loss of $53.0 million, or $0.48 per share, for the full year ended December 31, 2014. By comparison, the Company reported a net loss of $80.3 million, or $0.83 per share, for the prior-year period. The Company reported impairment charges of $60.8 million in 2014, compared to $10.4 million reported in the prior year. Results for the prior year also included an aggregate pretax loss on early extinguishments of debt of $54.2 million, and income of $10.8 million, after tax, related to discontinued operations. These amounts are excluded from Adjusted Earnings and Adjusted Earnings per share. Balance Sheet Statistics As of December 31, 2014, Boyd Gaming had cash on hand of $145.3 million, including $29.9 million related to Peninsula. Total debt was $3.48 billion, of which $1.09 billion was related to Peninsula. As a result of the deconsolidation, Borgata is no longer included in the Company's balance sheet. Borgata had cash on hand of $36.1 million and total debt of $754.9 million at December 31, 2014. Full Year 2015 Guidance For the full year 2015, Boyd Gaming projects total Adjusted EBITDA, including Peninsula and 50% of Borgata's Adjusted EBITDA, of $535 million to $560 million. |