![]() Newsletter Signup
Stay informed with the
NEW Casino City Times newsletter! Related Links
Related News
|
Gaming News
Vici Properties reports over 35% year-over-year revenue growth26 July 2023(PRESS RELEASE) -- VICI Properties Inc., an experiential real estate investment trust, today reported results for the quarter ended 30 June 2023. All per share amounts included herein are on a per diluted common share basis unless otherwise stated. Second Quarter 2023 Financial and Operating Highlights
“VICI’s strong second quarter financial performance, exemplified by approximately 36% revenue growth and nearly 12% growth in AFFO per share year-over-year, reflects the impact of our consistent commitment to accretive acquisitions and strategic financings. We also ended the quarter with ample liquidity, including $739 million in cash and cash equivalents, $868 million of estimated equity proceeds available upon settlement of forward sale agreements, and $2.4 billion of availability under the Revolving Credit Facility. The quarter's results and current liquidity enable VICI to continue in our pursuit of attractive domestic and international growth opportunities across the experiential landscape. “In the second quarter, we continued to expand our international presence through the announced acquisition of four casino properties in Alberta, Canada with our existing tenant and partner, Century Casinos. Subsequent to quarter end, we also closed the previously announced acquisition with Century of Rocky Gap, proving the value of our enduring partnerships with growth-minded operators. Finally, we are excited to announce that subsequent to quarter end, we broadened and deepened our relationship with Canyon Ranch through the establishment of our VICI-Canyon Ranch Growth Partnership, a multi-faceted investment relationship. This initiative (fully described in a separate VICI release and VICI transaction deck at www.viciproperties.com) includes VICI investing preferred equity into the Canyon Ranch operating platform, an investment that will contribute to enabling the Canyon Ranch operating platform to resource the growth of the Canyon Ranch resort network and other brand extensions. Through this investment, we have also further enhanced our embedded growth pipeline with call rights on Canyon Ranch Tucson and Canyon Ranch Lenox as well as solidified the partnership as the capital partner for Canyon Ranch as they look to expand their wellness resort ecosystem.” Second Quarter 2023 Financial Results: Total Revenues Total revenues were $898.2 million for the quarter, an increase of 35.5% compared to $662.6 million for the quarter ended June 30, 2022. Total revenues for the quarter included $129.5 million of non-cash leasing and financing adjustments and $18.5 million of other income. Net Income (Loss) Attributable to Common Stockholders Net income (loss) attributable to common stockholders was $690.7 million for the quarter, or $0.69 per share, compared to $(57.7) million, or $(0.06) per share, for the quarter ended June 30, 2022. The net loss and net loss per share in Q2 2022 was primarily related, on an absolute basis, to the $551.9 million increase in the CECL allowance for the quarter ended June 30, 2022. Approximately 80% of the total allowance increase in Q2 2022 was driven by the CECL charge in relation to our entry into the MGM Master Lease in connection with the acquisition of MGM Growth Properties LLC, which closed on April 29, 2022. Funds from Operations FFO attributable to common stockholders was $690.7 million for the quarter, or $0.69 per share, compared to $(50.4) million, or $(0.06) per share, for the quarter ended 30 June 2022. The FFO and FFO per share loss in Q2 2022 was primarily related to, on an absolute basis, the increase in the CECL allowance for the quarter ended 30 June 2022, as described above. Adjusted Funds from Operations AFFO attributable to common stockholders was $540.4 million for the quarter, an increase of 25.7% compared to $430.1 million for the quarter ended June 30, 2022. AFFO per share was $0.54 for the quarter, an increase of 11.9% compared to $0.48 for the quarter ended 30 June 2022. Second Quarter 2023 Acquisitions and Portfolio Activity Acquisitions and Investments On 16 May 2023, the Company entered into definitive agreements to acquire four real estate assets from Century Casinos, Inc. in Alberta, Canada: Century Casino Edmonton, Century Casino St. Albert and Century Mile Racetrack and Casino, each in Edmonton, Alberta and Century Downs Racetrack and Casino in Calgary, Alberta, (collectively the “Century Canadian Portfolio”) for an aggregate purchase price of approximately C$221.7 million (approximately US$164.7 million based on the exchange rate at the time of the announcement) in cash. Simultaneous with the acquisition, the Century Canadian Portfolio will be added to the existing triple-net master lease agreement between the Company and Century (the "Century Master Lease") and annual rent will increase by C$17.3 million (approximately US$12.8 million based on the exchange rate at the time of the announcement) representing an implied acquisition capitalization rate of 7.8%. The Century Canadian Portfolio acquisition remains subject to customary closing conditions, including regulatory approvals, and is expected to close in the second half of 2023. Subsequent to quarter-end, on 25 July 2023, the Company completed the previously announced transaction to acquire the leasehold interest in the land and buildings associated with Rocky Gap Casino Resort ("Rocky Gap") in Flintstone, Maryland for $203.9 million in cash, with Century acquiring the operating assets of Rocky Gap for $56.1 million. Simultaneous with the close of the acquisition, Rocky Gap was added to the Century Master Lease and annual rent increased by $15.5 million. The transaction was funded through a combination of cash on hand and proceeds from the partial settlement of forward equity sale agreements discussed below. Subsequent to quarter-end, on 26 July 2023, the company committed to an up to $150.0 million preferred equity investment into the controlling entity of Canyon Ranch, a leading provider of holistic, integrative health and wellness guest experiences ("Canyon Ranch"). The preferred equity has a term of 10 years and may be redeemed by Canyon Ranch at any time, subject to a redemption premium in the first three years. In connection with this investment, the Company entered into (i) a call right agreement whereby the Company will have the option to call the real estate assets of each of the Canyon Ranch facility in Tucson, Arizona ("Canyon Ranch Tucson") and the Canyon Ranch facility in Lenox, Massachusetts ("Canyon Ranch Lenox") subject to certain conditions, and (ii) a right of first financing agreement pursuant to which the company will have the first right, but not the obligation, to serve as the real estate capital financing partner for Canyon Ranch with respect to the acquisition, build-out and/or redevelopment of future wellness resorts. If the call right(s) are exercised, Canyon Ranch would continue to operate the applicable wellness resort(s) subject to a long-term triple net master lease with the company. In addition, the company intends to provide approximately $150.0 million of mortgage financing to a subsidiary of Canyon Ranch secured by Canyon Ranch Tucson and Canyon Ranch Lenox. Proceeds of the mortgage financing would be used to refinance Canyon Ranch’s existing CMBS debt secured by these two assets. The mortgage financing will have an initial term of two years with three one-year extensions, exercisable at Canyon Ranch’s option, subject to satisfying certain customary extension conditions. The company expects the mortgage financing to close in Q3 2023. Second Quarter 2023 Capital Markets Activity On 4 April 2023, and subsequent to quarter end, on 20 July 2023, the company physically settled 3,200,000 and 6,000,000 shares, respectively, under the January 2023 forward sale agreements in exchange for aggregate net proceeds of approximately $291.8 million. During the three months ended 30 June 2023, the company sold a total of 327,306 shares under its ATM program for a net value of $10.4 million, all of which were sold subject to a forward sale agreement (the "Q2 2023 ATM Forward Sale Agreement"). The company did not receive any proceeds from the sale of shares at the time it entered into the Q2 2023 ATM Forward Sale Agreement. Subsequent to quarter end, on 12 July 2023, the company entered into a forward-starting interest rate swap agreement with an aggregate notional amount of $50.0 million, intended to reduce the variability in future cash flows for a forecasted issuance of long-term debt over a maximum period ended December 2024. As of 30 June 2023, the company had approximately $17.1 billion in total debt and approximately $4.0 billion in liquidity, comprised of $738.8 million in cash and cash equivalents, $867.9 million of estimated proceeds available upon settlement of outstanding forward sale agreements, and approximately $2.4 billion of availability under the Revolving Credit Facility. In addition, the Revolving Credit Facility includes the option to increase the revolving loan commitments by up to $1.0 billion to the extent that any one or more lenders (from the syndicate or otherwise) agree to provide such additional credit extensions. On 8 June 2023, the company declared a regular quarterly cash dividend of $0.39 per share. The Q2 2023 dividend was paid on 6 July 2023 to stockholders of record as of the close of business on 22 June 2023 and totaled in aggregate approximately $392.9 million. 2023 Guidance The company is updating AFFO guidance for the full year 2023. In determining AFFO, the company adjusts for certain items that are otherwise included in determining net income attributable to common stockholders, the most comparable generally accepted accounting principles in the United States (“GAAP”) financial measure. In reliance on the exception provided by applicable rules, the Company does not provide guidance for GAAP net income, the most comparable GAAP financial measure, or a reconciliation of 2023 AFFO to GAAP net income because we are unable to predict with reasonable certainty the amount of the change in non-cash allowance for credit losses under ASU No. 2016-13 - Financial Instruments—Credit Losses (Topic 326) (“ASC 326”) for a future period. The non-cash change in allowance for credit losses under ASC 326 with respect to a future period is dependent upon future events that are entirely outside of the Company’s control and may not be reliably predicted, including its tenants’ respective financial performance, fluctuations in the trading price of their common stock, credit ratings and outlook (each to the extent applicable), as well as broader macroeconomic performance. Based on past results and, as disclosed in our historical financial results, the impact of these adjustments could be material, individually or in the aggregate, to the company’s reported GAAP results. For more information, see “Non-GAAP Financial Measures.” The company estimates AFFO for the year ending 31 December 2023 will be between $2,130 million and $2,160 million, or between $2.11 and $2.14 per diluted share. Guidance does not include the impact on operating results from any pending or possible future acquisitions or dispositions, capital markets activity, or other non-recurring transactions. |