Exhibit 99.1
MOHEGAN TRIBAL GAMING AUTHORITY ANNOUNCES
FOURTH QUARTER FISCAL 2016 OPERATING RESULTS
Uncasville, Connecticut, November 22, 2016 – The Mohegan Tribal Gaming Authority, or the Authority, the owner and operator of Mohegan Sun in Uncasville, Connecticut, and Mohegan Sun Pocono in Wilkes-Barre, Pennsylvania, announced today the operating results for its fourth fiscal quarter ended September 30, 2016.
“We are pleased to report another quarter of strong operating results and year-over-year growth,” said Robert J. Soper, President and Chief Executive Officer of the Authority. “Our fiscal fourth quarter capped off an equally strong fiscal year, highlighted by increased consolidated profit and profit margin, led by Mohegan Sun which generated its highest operating cash flow since 2008. With a successful comprehensive refinancing behind us, the opening of our new 400-room Earth Hotel and the grand opening of ilani Resort approximately two quarters away, we look forward to even stronger financial performance going forward.”
Consolidated operating results for the fourth quarter ended September 30, 2016 (unaudited):
| • | Net revenues of $346.4 million, a 2.1% increase over the fourth quarter of fiscal 2015 |
| • | Gaming revenues of $301.0 million, a 1.6% increase over the fourth quarter of fiscal 2015 |
| • | Gross slot revenues of $209.1 million, a 0.9% increase over the fourth quarter of fiscal 2015 |
| • | Table game revenues of $91.7 million, a 5.0% increase over the fourth quarter of fiscal 2015 |
| • | Non-gaming revenues of $70.0 million, a 1.5% increase over the fourth quarter of fiscal 2015 |
| • | Adjusted EBITDA, a non-GAAP measure described below, of $94.8 million, a 2.1% increase over the fourth quarter of fiscal 2015 |
| • | Adjusted EBITDA margin of 27.4%, relatively flat compared to the fourth quarter of fiscal 2015 |
| • | Income from operations of $72.8 million, relatively flat compared to the fourth quarter of fiscal 2015 |
| • | Net income attributable to the Authority of $44.2 million, a 21.2% increase over the fourth quarter of fiscal 2015 |
The growth in Adjusted EBITDA was principally driven by higher gaming revenues at Mohegan Sun and increased revenues generated by Corporate. Income from operations was relatively flat. Net income attributable to the Authority increased primarily as a result of a non-recurring loss on early extinguishment of debt recorded in the fourth quarter of fiscal 2015 and lower interest expense, combined with the increase in Adjusted EBITDA.
Mohegan Sun
Operating results (in thousands, unaudited):
| For the Three Months Ended | ||||||||||||||||
| September 30, 2016 | September 30, 2015 | Variance | Percentage Variance | |||||||||||||
Adjusted EBITDA | $ | 83,600 | $ | 79,672 | $ | 3,928 | 4.9 | % | ||||||||
Income from operations | $ | 66,354 | $ | 63,638 | $ | 2,716 | 4.3 | % | ||||||||
Operating costs and expenses | $ | 200,330 | $ | 197,469 | $ | 2,861 | 1.4 | % | ||||||||
Net revenues | $ | 266,684 | $ | 261,107 | $ | 5,577 | 2.1 | % | ||||||||
Gaming revenues | $ | 231,854 | $ | 226,142 | $ | 5,712 | 2.5 | % | ||||||||
Non-gaming revenues | $ | 54,016 | $ | 55,571 | $ | (1,555 | ) | (2.8 | %) | |||||||
The growth in Adjusted EBITDA and income from operations primarily resulted from increased table game and slot revenues driven by higher gaming volumes, combined with lower payroll costs. These results were partially offset by higher costs related to general administrative and consulting services. The decline in non-gaming revenues primarily reflected lower entertainment revenues resulting from a reduction in the number of shows held at the Mohegan Sun Arena. Adjusted EBITDA margin increased to 31.3% for the quarter ended September 30, 2016 from 30.5% in the fourth quarter of fiscal 2015.
Selected gaming data (in thousands, except where noted, unaudited):
| For the Three Months Ended | ||||||||||||||||
| September 30, 2016 | September 30, 2015 | Variance | Percentage Variance | |||||||||||||
Slots: | ||||||||||||||||
Handle | $ | 1,874,628 | $ | 1,849,341 | $ | 25,287 | 1.4 | % | ||||||||
Gross revenues | $ | 153,874 | $ | 151,333 | $ | 2,541 | 1.7 | % | ||||||||
Net revenues | $ | 147,794 | $ | 146,165 | $ | 1,629 | 1.1 | % | ||||||||
Free promotional slot plays (1) | $ | 15,553 | $ | 15,517 | $ | 36 | 0.2 | % | ||||||||
Weighted average number of machines (in units) | 5,095 | 5,136 | (41 | ) | (0.8 | %) | ||||||||||
Hold percentage (gross) | 8.2 | % | 8.2 | % | — | — | ||||||||||
Win per unit per day (gross) (in dollars) | $ | 328 | $ | 320 | $ | 8 | 2.5 | % | ||||||||
Table games: | ||||||||||||||||
Drop | $ | 497,499 | $ | 451,120 | $ | 46,379 | 10.3 | % | ||||||||
Revenues | $ | 80,956 | $ | 76,716 | $ | 4,240 | 5.5 | % | ||||||||
Weighted average number of games (in units) | 278 | 283 | (5 | ) | (1.8 | %) | ||||||||||
Hold percentage (2) | 16.3 | % | 17.0 | % | (0.7 | %) | (4.1 | %) | ||||||||
Win per unit per day (in dollars) | $ | 3,166 | $ | 2,950 | $ | 216 | 7.3 | % | ||||||||
Poker: | ||||||||||||||||
Revenues | $ | 2,192 | $ | 2,268 | $ | (76 | ) | (3.4 | %) | |||||||
Weighted average number of tables (in units) | 42 | 42 | — | — | ||||||||||||
Revenue per unit per day (in dollars) | $ | 567 | $ | 587 | $ | (20 | ) | (3.4 | %) | |||||||
| (1) | Free promotional slot plays are included in slot handle, but not reflected in slot revenues. |
| (2) | Table game hold percentage is relatively predictable over longer periods of time, but can significantly fluctuate over shorter periods. |
Non-gaming data (in thousands, except where noted, unaudited):
| For the Three Months Ended | ||||||||||||||||
| September 30, 2016 | September 30, 2015 | Variance | Percentage Variance | |||||||||||||
Food and beverage: | ||||||||||||||||
Revenues | $ | 14,735 | $ | 15,399 | $ | (664 | ) | (4.3 | %) | |||||||
Meals served | 676 | 727 | (51 | ) | (7.0 | %) | ||||||||||
Average price per meal served (in dollars) | $ | 16.23 | $ | 15.85 | $ | 0.38 | 2.4 | % | ||||||||
Hotel: | ||||||||||||||||
Revenues | $ | 12,257 | $ | 11,695 | $ | 562 | 4.8 | % | ||||||||
Rooms occupied | 106 | 106 | — | — | ||||||||||||
Occupancy rate | 97.8 | % | 98.5 | % | (0.7 | %) | (0.7 | %) | ||||||||
Average daily room rate (in dollars) | $ | 109 | $ | 102 | $ | 7 | 6.9 | % | ||||||||
Revenue per available room (in dollars) | $ | 107 | $ | 101 | $ | 6 | 5.9 | % | ||||||||
Retail, entertainment and other: | ||||||||||||||||
Revenues | $ | 27,024 | $ | 28,477 | $ | (1,453 | ) | (5.1 | %) | |||||||
Arena events (in events) | 33 | 35 | (2 | ) | (5.7 | %) | ||||||||||
Arena tickets | 195 | 199 | (4 | ) | (2.0 | %) | ||||||||||
Average price per Arena ticket (in dollars) | $ | 44.10 | $ | 43.17 | $ | 0.93 | 2.2 | % | ||||||||
Mohegan Sun Pocono
Operating results (in thousands, unaudited):
| For the Three Months Ended | ||||||||||||||||
| September 30, 2016 | September 30, 2015 | Variance | Percentage Variance | |||||||||||||
Adjusted EBITDA | $ | 13,463 | $ | 17,306 | $ | (3,843 | ) | (22.2 | %) | |||||||
Income from operations | $ | 10,535 | $ | 14,394 | $ | (3,859 | ) | (26.8 | %) | |||||||
Operating costs and expenses | $ | 64,982 | $ | 62,285 | $ | 2,697 | 4.3 | % | ||||||||
Net revenues | $ | 75,517 | $ | 76,679 | $ | (1,162 | ) | (1.5 | %) | |||||||
Gaming revenues | $ | 69,143 | $ | 70,115 | $ | (972 | ) | (1.4 | %) | |||||||
Non-gaming revenues | $ | 11,784 | $ | 11,771 | $ | 13 | 0.1 | % | ||||||||
The declines in Adjusted EBITDA and income from operations primarily resulted from a combination of higher operating costs and expenses and a difficult comparison due to a non-recurring property tax adjustment recorded in the fourth quarter of fiscal 2015. These results were partially offset by lower payroll costs. Adjusted EBITDA margin decreased to 17.8% for the quarter ended September 30, 2016 from 22.6% in the fourth quarter of fiscal 2015.
Selected gaming data (in thousands, except where noted, unaudited):
| For the Three Months Ended | ||||||||||||||||
| September 30, 2016 | September 30, 2015 | Variance | Percentage Variance | |||||||||||||
Slots: | ||||||||||||||||
Handle | $ | 679,208 | $ | 692,710 | $ | (13,502 | ) | (1.9 | %) | |||||||
Gross revenues | $ | 55,184 | $ | 55,796 | $ | (612 | ) | (1.1 | %) | |||||||
Net revenues | $ | 55,058 | $ | 55,794 | $ | (736 | ) | (1.3 | %) | |||||||
Free promotional slot plays (1) | $ | 11,485 | $ | 12,687 | $ | (1,202 | ) | (9.5 | %) | |||||||
Weighted average number of machines (in units) | 2,297 | 2,332 | (35 | ) | (1.5 | %) | ||||||||||
Hold percentage (gross) | 8.1 | % | 8.1 | % | — | — | ||||||||||
Win per unit per day (gross) (in dollars) | $ | 260 | $ | 260 | $ | — | — | |||||||||
Table games: | ||||||||||||||||
Drop | $ | 54,729 | $ | 56,562 | $ | (1,833 | ) | (3.2 | %) | |||||||
Revenues | $ | 10,777 | $ | 10,640 | $ | 137 | 1.3 | % | ||||||||
Weighted average number of games (in units) | 73 | 73 | — | — | ||||||||||||
Hold percentage (2) | 19.7 | % | 18.8 | % | 0.9 | % | 4.8 | % | ||||||||
Win per unit per day (in dollars) | $ | 1,605 | $ | 1,584 | $ | 21 | 1.3 | % | ||||||||
Poker: | ||||||||||||||||
Revenues | $ | 661 | $ | 704 | $ | (43 | ) | (6.1 | %) | |||||||
Weighted average number of tables (in units) | 18 | 18 | — | — | ||||||||||||
Revenue per unit per day (in dollars) | $ | 400 | $ | 425 | $ | (25 | ) | (5.9 | %) | |||||||
| (1) | Free promotional slot plays are included in slot handle, but not reflected in slot revenues. |
| (2) | Table game hold percentage is relatively predictable over longer periods of time, but can significantly fluctuate over shorter periods. |
Non-gaming revenues (in thousands, except where noted, unaudited):
| For the Three Months Ended | ||||||||||||||||
| September 30, 2016 | September 30, 2015 | Variance | Percentage Variance | |||||||||||||
Food and beverage: | ||||||||||||||||
Revenues | $ | 7,380 | $ | 7,510 | $ | (130 | ) | (1.7 | %) | |||||||
Meals served | 165 | 186 | (21 | ) | (11.3 | %) | ||||||||||
Average price per meal served (in dollars) | $ | 19.85 | | $ | 17.44 | | $ | 2.41 | | 13.8 | % | |||||
Hotel: | ||||||||||||||||
Revenues | $ | 1,665 | $ | 1,602 | $ | 63 | 3.9 | % | ||||||||
Rooms occupied | 21 | 21 | — | — | ||||||||||||
Occupancy rate | 96.8 | % | 98.5 | % | (1.7 | %) | (1.7 | %) | ||||||||
Average daily room rate (in dollars) | $ | 73 | $ | 69 | $ | 4 | 5.8 | % | ||||||||
Revenue per available room (in dollars) | $ | 71 | $ | 68 | $ | 3 | 4.4 | % | ||||||||
Retail, entertainment and other: | ||||||||||||||||
Revenues | $ | 2,739 | $ | 2,659 | $ | 80 | 3.0 | % | ||||||||
Corporate
Operating results (in thousands, unaudited):
| For the Three Months Ended | ||||||||||||||||
| September 30, 2016 | September 30, 2015 | Variance | Percentage Variance | |||||||||||||
Adjusted EBITDA | $ | (2,226 | ) | $ | (4,055 | ) | $ | 1,829 | 45.1 | % | ||||||
Loss from operations | $ | (4,077 | ) | $ | (5,136 | ) | $ | 1,059 | 20.6 | % | ||||||
Operating costs and expenses | $ | 9,541 | $ | 8,049 | $ | 1,492 | 18.5 | % | ||||||||
Net revenues | $ | 5,464 | $ | 2,913 | $ | 2,551 | 87.6 | % | ||||||||
Adjusted EBITDA and loss from operations benefited from increased revenues driven by development and consulting fees earned in connection with our development arrangement for the Cowlitz Project and our consulting arrangement with Paragon Casino Resort. The increase in operating costs and expenses primarily reflected increased expenditures associated with various diversification initiatives.
Mohegan Tribal Gaming Authority Property Information
| (in thousands, unaudited) | Adjusted EBITDA For the Three Months Ended | Income (Loss) from Operations For the Three Months Ended | Net Revenues For the Three Months Ended | |||||||||||||||||||||
| September 30, 2016 | September 30, 2015 | September 30, 2016 | September 30, 2015 | September 30, 2016 | September 30, 2015 | |||||||||||||||||||
Mohegan Sun | $ | 83,600 | $ | 79,672 | $ | 66,354 | $ | 63,638 | $ | 266,684 | $ | 261,107 | ||||||||||||
Mohegan Sun Pocono | 13,463 | 17,306 | 10,535 | 14,394 | 75,517 | 76,679 | ||||||||||||||||||
Corporate | (2,226 | ) | (4,055 | ) | (4,077 | ) | (5,136 | ) | 5,464 | 2,913 | ||||||||||||||
Inter-segment revenues | — | — | — | — | (1,273 | ) | (1,273 | ) | ||||||||||||||||
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Total | $ | 94,837 | $ | 92,923 | $ | 72,812 | $ | 72,896 | $ | 346,392 | $ | 339,426 | ||||||||||||
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| Adjusted EBITDA For the Fiscal Year Ended | Income (Loss) from Operations For the Fiscal Year Ended | Net Revenues For the Fiscal Year Ended | ||||||||||||||||||||||
| September 30, 2016 | September 30, 2015 | September 30, 2016 | September 30, 2015 | September 30, 2016 | September 30, 2015 | |||||||||||||||||||
Mohegan Sun | $ | 302,181 | $ | 284,091 | $ | 237,605 | $ | 212,211 | $ | 1,022,076 | $ | 994,010 | ||||||||||||
Mohegan Sun Pocono | 53,281 | 57,946 | 41,445 | 45,817 | 298,677 | 295,135 | ||||||||||||||||||
Corporate | (12,062 | ) | (22,380 | ) | (17,907 | ) | (24,853 | ) | 19,133 | 7,567 | ||||||||||||||
Inter-segment revenues | — | — | — | — | (5,092 | ) | (5,092 | ) | ||||||||||||||||
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Total | $ | 343,400 | $ | 319,657 | $ | 261,143 | $ | 233,175 | $ | 1,334,794 | $ | 1,291,620 | ||||||||||||
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Other Information
Liquidity
As of September 30, 2016, the Authority held cash and cash equivalents of $83.7 million compared to $65.8 million as of September 30, 2015. As of September 30, 2016, $13.0 million was drawn on the Authority’s $100 million revolving credit facility, while no amounts were drawn on the Authority’s $16.5 million line of credit. As of September 30, 2016, letters of credit issued under the revolving credit facility totaled $2.5 million, of which no amounts were drawn. Inclusive of letters of credit, which reduce borrowing availability under the revolving credit facility, the Authority had approximately $84.5 million of borrowing capacity under its revolving credit facility and line of credit as of September 30, 2016.
Interest Expense
Interest expense decreased by $2.3 million, or 6.3%, to $33.9 million for the quarter ended September 30, 2016 compared to $36.2 million in the fourth quarter of fiscal 2015. The reduction in interest expense was attributable to lower weighted average interest rate. Weighted average interest rate was 7.9% for the quarter ended September 30, 2016 compared to 8.5% in the fourth quarter of fiscal 2015. Weighted average outstanding debt was $1.71 billion for the quarter ended September 30, 2016 compared to $1.69 billion in the fourth quarter of fiscal 2015.
Capital Expenditures
The following table presents data related to capital expenditures (in millions):
| Capital Expenditures | ||||||||
| Fiscal Year Ended September 30, 2016 | Forecasted Fiscal Year 2017 | |||||||
Mohegan Sun: | ||||||||
Maintenance | $ | 29.0 | $ | 35.0 | ||||
Development | 10.9 | 0.9 | ||||||
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Subtotal | 39.9 | 35.9 | ||||||
Mohegan Sun Pocono: | ||||||||
Maintenance | 5.4 | 7.3 | ||||||
Development | 2.2 | 0.7 | ||||||
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Subtotal | 7.6 | 8.0 | ||||||
Corporate: | ||||||||
Maintenance | 0.2 | 0.2 | ||||||
Development | — | 0.7 | ||||||
Other | 1.3 | — | ||||||
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Subtotal | 1.5 | 0.9 | ||||||
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Total | $ | 49.0 | $ | 44.8 | ||||
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Distributions to the Tribe
Distributions to the Tribe totaled $18.5 million for the quarter ended September 30, 2016 compared to $17.5 million in the fourth quarter of fiscal 2015. Distributions to the Tribe are anticipated to total $60.0 million for fiscal 2017.
Conference Call
The Authority will host a conference call and simultaneous webcast regarding its fourth quarter fiscal 2016 operating results on Tuesday, November 22, 2016 at 11:00 a.m. (Eastern Standard Time).
Those interested in participating in the call should dial as follows:
(877) 756-4274
(706) 643-0107 (International)
Conference ID: 85028365
Please call five minutes in advance to ensure that you are connected prior to the initiation of the call. Questions and answers will be reserved for call-in analysts and investors.
Parties who want to listen to the live conference call on the Internet may do so through a web link on the Authority’s website atwww.mtga.com, under the “Investor Relations/Financial News” section. Interested parties also may listen to a taped replay of the entire conference call commencing two hours after the call’s completion on Tuesday, November 22, 2016. This replay will run through December 6, 2016.
The access number for a taped replay of the conference call is as follows:
(855) 859-2056
(404) 537-3406 (International)
Conference ID: 85028365
A transcript will be available on the Authority’s website for a period of 90 days following the conference call.
About the Authority
The Authority is an instrumentality of the Mohegan Tribe of Indians of Connecticut, or the Tribe, a federally-recognized Indian tribe with an approximately 595-acre reservation situated in southeastern Connecticut, adjacent to Uncasville, Connecticut. The Authority has been granted the exclusive authority to conduct and regulate gaming activities on the existing reservation of the Tribe, including the operation of Mohegan Sun, a gaming and entertainment complex located on an approximately 185-acre site on the Tribe’s reservation. Through its subsidiary, Downs Racing, L.P., the Authority also owns and operates Mohegan Sun Pocono, a gaming and entertainment facility located on an approximately 400-acre site in Plains Township, Pennsylvania, and several off-track wagering facilities located elsewhere in Pennsylvania.
The Tribe’s gaming operation at Mohegan Sun is one of only two legally authorized gaming operations in southern New England offering traditional slot machines and table games. Mohegan Sun currently operates in an approximately 3.1 million square-foot facility, which includes Casino of the Earth, Casino of the Sky, Casino of the Wind, 100,000 square feet of retail space, including The Shops at Mohegan Sun, a 10,000-seat Mohegan Sun Arena, a 350-seat Cabaret Theatre, 100,000 square feet of meeting and convention space and the 1,200-room luxury Sky Hotel Tower. Mohegan Sun Pocono operates in an approximately 400,000 square-foot facility, offering traditional slot machines and table games, live harness racing and simulcast and off-track wagering, a 238-room hotel, 20,000 square feet of meeting and convention space, several dining and retail options and a bus passenger lounge. More information about the Authority and its properties can be obtained by visitingwww.mohegansun.com,www.mohegansunpocono.com orwww.mtga.com.
Special Note Regarding Forward-Looking Statements
Some information included in this press release may contain forward-looking statements, within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. These statements can sometimes be identified by the use of forward-looking words such as “may,” “will,” “anticipate,” “estimate,” “expect” or “intend” and similar expressions. Such forward-looking information may involve important risks and uncertainties that could significantly affect anticipated results in the future and, accordingly, such results may differ materially from those
expressed in any forward-looking statements made by or on behalf of the Authority. Information concerning potential factors that could affect the Authority’s financial results is included in its Annual Report on Form 10-K for the fiscal year ended September 30, 2015, as well as in the Authority’s other reports and filings with the Securities and Exchange Commission. Any forward-looking statements included in this press release are made only as of the date of this release. The Authority does not undertake any obligation to update or supplement any forward-looking statements to reflect subsequent events or circumstances. The Authority cannot assure that projected results or events will be achieved or will occur.
MOHEGAN TRIBAL GAMING AUTHORITY
CONSOLIDATED STATEMENTS OF INCOME
(in thousands)
(unaudited)
| For the Three Months Ended September 30, 2016 | For the Three Months Ended September 30, 2015 | For the Fiscal Year Ended September 30, 2016 | For the Fiscal Year Ended September 30, 2015 | |||||||||||||
Revenues: | ||||||||||||||||
Gaming | $ | 300,997 | $ | 296,257 | $ | 1,166,886 | $ | 1,133,720 | ||||||||
Food and beverage | 22,115 | 22,909 | 88,923 | 89,720 | ||||||||||||
Hotel | 13,922 | 13,297 | 52,561 | 50,496 | ||||||||||||
Retail, entertainment and other | 33,986 | 32,799 | 123,017 | 115,030 | ||||||||||||
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Gross revenues | 371,020 | 365,262 | 1,431,387 | 1,388,966 | ||||||||||||
Less – Promotional allowances | (24,628 | ) | (25,836 | ) | (96,593 | ) | (97,346 | ) | ||||||||
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Net revenues | 346,392 | 339,426 | 1,334,794 | 1,291,620 | ||||||||||||
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Operating costs and expenses: | ||||||||||||||||
Gaming | 166,569 | 165,906 | 661,629 | 651,900 | ||||||||||||
Food and beverage | 9,630 | 10,191 | 40,437 | 41,554 | ||||||||||||
Hotel | 4,287 | 4,167 | 16,018 | 14,934 | ||||||||||||
Retail, entertainment and other | 11,917 | 11,511 | 42,608 | 45,779 | ||||||||||||
Advertising, general and administrative | 51,576 | 47,978 | 200,447 | 188,924 | ||||||||||||
Corporate | 9,220 | 7,727 | 35,821 | 31,127 | ||||||||||||
Depreciation and amortization | 17,944 | 18,877 | 73,913 | 77,580 | ||||||||||||
(Gain) loss on disposition of assets | (161 | ) | 173 | 180 | 1,018 | |||||||||||
Severance | — | — | — | 3,370 | ||||||||||||
Pre-opening | 723 | — | 723 | — | ||||||||||||
Impairment | 1,875 | — | 1,875 | 2,502 | ||||||||||||
Relinquishment liability reassessment | — | — | — | (243 | ) | |||||||||||
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Total operating costs and expenses | 273,580 | 266,530 | 1,073,651 | 1,058,445 | ||||||||||||
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Income from operations | 72,812 | 72,896 | 261,143 | 233,175 | ||||||||||||
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Other income (expense): | ||||||||||||||||
Accretion of discount to the relinquishment liability | — | — | — | (227 | ) | |||||||||||
Interest income | 3,091 | 2,429 | 9,560 | 7,983 | ||||||||||||
Interest expense | (33,900 | ) | (36,184 | ) | (136,194 | ) | (143,876 | ) | ||||||||
Loss on modification and early extinguishment of debt | — | (3,987 | ) | (484 | ) | (3,987 | ) | |||||||||
Income (loss) from unconsolidated affiliates | 399 | 330 | (939 | ) | (972 | ) | ||||||||||
Other income (expense), net | 8 | 1 | (9 | ) | 43 | |||||||||||
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Total other expense | (30,402 | ) | (37,411 | ) | (128,066 | ) | (141,036 | ) | ||||||||
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Net income | 42,410 | 35,485 | 133,077 | 92,139 | ||||||||||||
(Income) loss attributable to non-controlling interests | 1,798 | 977 | (427 | ) | 2,255 | |||||||||||
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Net income attributable to Mohegan Tribal Gaming Authority | $ | 44,208 | $ | 36,462 | $ | 132,650 | $ | 94,394 | ||||||||
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MOHEGAN TRIBAL GAMING AUTHORITY
CONSOLIDATED SELECTED FINANCIAL INFORMATION
(in thousands)
(unaudited)
| For the Three Months Ended | For the Fiscal Year Ended | |||||||||||||||
| September 30, 2016 | September 30, 2015 | September 30, 2016 | September 30, 2015 | |||||||||||||
Operating Results: | ||||||||||||||||
Gross revenues | $ | 371,020 | $ | 365,262 | $ | 1,431,387 | $ | 1,388,966 | ||||||||
Net revenues | $ | 346,392 | $ | 339,426 | $ | 1,334,794 | $ | 1,291,620 | ||||||||
Income from operations | $ | 72,812 | $ | 72,896 | $ | 261,143 | $ | 233,175 | ||||||||
Other Data: | ||||||||||||||||
Adjusted EBITDA | $ | 94,837 | $ | 92,923 | $ | 343,400 | $ | 319,657 | ||||||||
Capital expenditures | $ | 21,267 | $ | 20,986 | $ | 48,962 | $ | 30,024 | ||||||||
Cash interest paid | $ | 48,142 | $ | 55,941 | $ | 132,730 | $ | 136,541 | ||||||||
Distributions to the Tribe | $ | 18,550 | $ | 17,500 | $ | 53,000 | $ | 50,000 | ||||||||
Balance Sheet Data: | September 30, 2016 | September 30, 2015 | ||||||||||||||
Cash and cash equivalents | $ | 83,743 | $ | 65,754 | ||||||||||||
Capital leases | $ | 1,521 | $ | 2,345 | ||||||||||||
Long-term debt, including current portion | $ | 1,685,167 | $ | 1,666,344 | ||||||||||||
MOHEGAN SUN
SUPPLEMENTAL DATA
(unaudited)
| For the Three Months Ended | For the Fiscal Year Ended | |||||||||||||||
| September 30, 2016 | September 30, 2015 | September 30, 2016 | September 30, 2015 | |||||||||||||
Operating results: | ||||||||||||||||
Gross revenues (in thousands) | $ | 285,870 | $ | 281,713 | $ | 1,096,864 | $ | 1,071,194 | ||||||||
Net revenues (in thousands) | $ | 266,684 | $ | 261,107 | $ | 1,022,076 | $ | 994,010 | ||||||||
Income from operations (in thousands) | $ | 66,354 | $ | 63,638 | $ | 237,605 | $ | 212,211 | ||||||||
Operating margin | 24.9 | % | 24.4 | % | 23.2 | % | 21.3 | % | ||||||||
Adjusted EBITDA: | ||||||||||||||||
Adjusted EBITDA (in thousands) | $ | 83,600 | $ | 79,672 | $ | 302,181 | $ | 284,091 | ||||||||
Adjusted EBITDA margin | 31.3 | % | 30.5 | % | 29.6 | % | 28.6 | % | ||||||||
Capital expenditures (in thousands) | $ | 16,255 | $ | 17,622 | $ | 39,921 | $ | 24,521 | ||||||||
Weighted average number of units: | ||||||||||||||||
Slot machines | 5,095 | 5,136 | 5,123 | 5,268 | ||||||||||||
Table games | 278 | 283 | 273 | 283 | ||||||||||||
Poker tables | 42 | 42 | 42 | 42 | ||||||||||||
Win per unit per day: | ||||||||||||||||
Slot machines (gross) | $ | 328 | $ | 320 | $ | 316 | $ | 303 | ||||||||
Table games | $ | 3,166 | $ | 2,950 | $ | 3,088 | $ | 2,781 | ||||||||
Poker tables | $ | 567 | $ | 587 | $ | 606 | $ | 637 | ||||||||
Hold percentage: | ||||||||||||||||
Slot machines (gross) | 8.2 | % | 8.2 | % | 8.1 | % | 8.3 | % | ||||||||
Table games | 16.3 | % | 17.0 | % | 16.4 | % | 16.3 | % | ||||||||
Food and beverage statistics: | ||||||||||||||||
Meals served (in thousands) | 676 | 727 | 2,684 | 2,881 | ||||||||||||
Average price per meal served | $ | 16.23 | $ | 15.85 | $ | 16.16 | $ | 15.92 | ||||||||
Hotel statistics: | ||||||||||||||||
Rooms occupied (in thousands) | 106 | 106 | 423 | 420 | ||||||||||||
Occupancy rate | 97.8 | % | 98.5 | % | 98.4 | % | 98.0 | % | ||||||||
Average daily room rate | $ | 109 | $ | 102 | $ | 103 | $ | 100 | ||||||||
Revenue per available room | $ | 107 | $ | 101 | $ | 102 | $ | 98 | ||||||||
Entertainment statistics: | ||||||||||||||||
Arena events (in events) | 33 | 35 | 118 | 120 | ||||||||||||
Arena tickets (in thousands) | 195 | 199 | 667 | 691 | ||||||||||||
Average price per Arena ticket | $ | 44.10 | $ | 43.17 | $ | 48.05 | $ | 50.60 | ||||||||
MOHEGAN SUN POCONO
SUPPLEMENTAL DATA
(unaudited)
| For the Three Months Ended | For the Fiscal Year Ended | |||||||||||||||
| September 30, 2016 | September 30, 2015 | September 30, 2016 | September 30, 2015 | |||||||||||||
Operating results: | ||||||||||||||||
Gross revenues (in thousands) | $ | 80,927 | $ | 81,886 | $ | 320,364 | $ | 315,224 | ||||||||
Net revenues (in thousands) | $ | 75,517 | $ | 76,679 | $ | 298,677 | $ | 295,135 | ||||||||
Income from operations (in thousands) | $ | 10,535 | $ | 14,394 | $ | 41,445 | $ | 45,817 | ||||||||
Operating margin | 14.0 | % | 18.8 | % | 13.9 | % | 15.5 | % | ||||||||
Adjusted EBITDA: | ||||||||||||||||
Adjusted EBITDA (in thousands) | $ | 13,463 | $ | 17,306 | $ | 53,281 | $ | 57,946 | ||||||||
Adjusted EBITDA margin | 17.8 | % | 22.6 | % | 17.8 | % | 19.6 | % | ||||||||
Capital expenditures (in thousands) | $ | 3,661 | $ | 3,361 | $ | 7,575 | $ | 5,448 | ||||||||
Weighted average number of units: | ||||||||||||||||
Slot machines | 2,297 | 2,332 | 2,322 | 2,331 | ||||||||||||
Table games | 73 | 73 | 73 | 73 | ||||||||||||
Poker tables | 18 | 18 | 18 | 18 | ||||||||||||
Win per unit per day: | ||||||||||||||||
Slot machines (gross) | $ | 260 | $ | 260 | $ | 260 | $ | 251 | ||||||||
Table games | $ | 1,605 | $ | 1,584 | $ | 1,575 | $ | 1,699 | ||||||||
Poker tables | $ | 400 | $ | 425 | $ | 454 | $ | 462 | ||||||||
Hold percentage: | ||||||||||||||||
Slot machines (gross) | 8.1 | % | 8.1 | % | 8.1 | % | 8.2 | % | ||||||||
Table games | 19.7 | % | 18.8 | % | 19.2 | % | 19.7 | % | ||||||||
Food and beverage statistics: | ||||||||||||||||
Meals served (in thousands) | 165 | 186 | 664 | 695 | ||||||||||||
Average price per meal served | $ | 19.85 | $ | 17.44 | $ | 19.67 | $ | 17.94 | ||||||||
Hotel statistics: | ||||||||||||||||
Rooms occupied (in thousands) | 21 | 21 | 83 | 82 | ||||||||||||
Occupancy rate | 96.8 | % | 98.5 | % | 96.3 | % | 95.2 | % | ||||||||
Average daily room rate | $ | 73 | $ | 69 | $ | 66 | $ | 64 | ||||||||
Revenue per available room | $ | 71 | $ | 68 | $ | 64 | $ | 61 | ||||||||
CORPORATE
SUPPLEMENTAL DATA
(unaudited)
| For the Three Months Ended | For the Fiscal Year Ended | |||||||||||||||
| September 30, 2016 | September 30, 2015 | September 30, 2016 | September 30, 2015 | |||||||||||||
Operating results: | ||||||||||||||||
Gross revenues (in thousands) | $ | 5,496 | $ | 2,936 | $ | 19,251 | $ | 7,640 | ||||||||
Net revenues (in thousands) | $ | 5,464 | $ | 2,913 | $ | 19,133 | $ | 7,567 | ||||||||
Loss from operations (in thousands) | $ | (4,077 | ) | $ | (5,136 | ) | $ | (17,907 | ) | $ | (24,853 | ) | ||||
Adjusted EBITDA (in thousands) | $ | (2,226 | ) | $ | (4,055 | ) | $ | (12,062 | ) | $ | (22,380 | ) | ||||
Capital expenditures (in thousands) | $ | 1,351 | $ | 3 | $ | 1,466 | $ | 55 | ||||||||
MOHEGAN TRIBAL GAMING AUTHORITY
ADJUSTED EBITDA RECONCILIATIONS
(unaudited)
Reconciliations of Adjusted EBITDA to Net Income:
Reconciliations of Adjusted EBITDA to net income, a financial measure determined in accordance with accounting principles generally accepted in the United States of America, or GAAP, are shown below (in thousands):
| For the Three Months Ended | For the Fiscal Year Ended | |||||||||||||||
| September 30, 2016 | September 30, 2015 | September 30, 2016 | September 30, 2015 | |||||||||||||
Adjusted EBITDA | $ | 94,837 | $ | 92,923 | $ | 343,400 | $ | 319,657 | ||||||||
Depreciation and amortization | (17,944 | ) | (18,877 | ) | (73,913 | ) | (77,580 | ) | ||||||||
Share compensation | — | — | (6,147 | ) | — | |||||||||||
Gain (loss) on disposition of assets | 161 | (173 | ) | (180 | ) | (1,018 | ) | |||||||||
Severance | — | — | — | (3,370 | ) | |||||||||||
Pre-opening | (723 | ) | — | (723 | ) | — | ||||||||||
Impairment | (1,875 | ) | — | (1,875 | ) | (2,502 | ) | |||||||||
Relinquishment liability reassessment | — | — | — | 243 | ||||||||||||
Adjusted EBITDA attributable to non-controlling interests | (1,644 | ) | (977 | ) | 581 | (2,255 | ) | |||||||||
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Income from operations | 72,812 | 72,896 | 261,143 | 233,175 | ||||||||||||
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Accretion of discount to the relinquishment liability | — | — | — | (227 | ) | |||||||||||
Interest income | 3,091 | 2,429 | 9,560 | 7,983 | ||||||||||||
Interest expense | (33,900 | ) | (36,184 | ) | (136,194 | ) | (143,876 | ) | ||||||||
Loss on modification and early extinguishment of debt | — | (3,987 | ) | (484 | ) | (3,987 | ) | |||||||||
Income (loss) from unconsolidated affiliates | 399 | 330 | (939 | ) | (972 | ) | ||||||||||
Other income (expense), net | 8 | 1 | (9 | ) | 43 | |||||||||||
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Net income | $ | 42,410 | $ | 35,485 | $ | 133,077 | $ | 92,139 | ||||||||
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Reconciliations of Income (Loss) from Operations to Adjusted EBITDA (unaudited):
Reconciliations of income (loss) from operations, a financial measure determined in accordance with GAAP, to Adjusted EBITDA, are shown below (in thousands):
| For the Three Months Ended September 30, 2016 | ||||||||||||||||||||||||||||||||||||||||
| Income (Loss) from Operations | Depreciation and Amortization | Share Compensation | (Gain) Loss on Disposition of Assets | Severance | Pre-Opening | Impairment | Relinquishment Liability Reassessment | Adjusted EBITDA Attributable to Non-controlling Interests | Adjusted EBITDA | |||||||||||||||||||||||||||||||
Mohegan Sun | $ | 66,354 | $ | 14,745 | $ | — | $ | (160 | ) | $ | — | $ | 723 | $ | 1,875 | $ | — | $ | 63 | $ | 83,600 | |||||||||||||||||||
Mohegan Sun Pocono | 10,535 | 2,929 | — | (1 | ) | — | — | — | — | — | 13,463 | |||||||||||||||||||||||||||||
Corporate | (4,077 | ) | 270 | — | — | — | — | — | — | 1,581 | (2,226 | ) | ||||||||||||||||||||||||||||
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Total | $ | 72,812 | $ | 17,944 | $ | — | $ | (161 | ) | $ | — | $ | 723 | $ | 1,875 | $ | — | $ | 1,644 | $ | 94,837 | |||||||||||||||||||
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| For the Three Months Ended September 30, 2015 | ||||||||||||||||||||||||||||||||||||||||
| Income (Loss) from Operations | Depreciation and Amortization | Share Compensation | (Gain) Loss on Disposition of Assets | Severance | Pre-Opening | Impairment | Relinquishment Liability Reassessment | Adjusted EBITDA Attributable to Non-controlling Interests | Adjusted EBITDA | |||||||||||||||||||||||||||||||
Mohegan Sun | $ | 63,638 | $ | 15,697 | $ | — | $ | 179 | $ | — | $ | — | $ | — | $ | — | $ | 158 | $ | 79,672 | ||||||||||||||||||||
Mohegan Sun Pocono | 14,394 | 2,918 | — | (6 | ) | — | — | — | — | — | 17,306 | |||||||||||||||||||||||||||||
Corporate | (5,136 | ) | 262 | — | — | — | — | — | — | 819 | (4,055 | ) | ||||||||||||||||||||||||||||
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Total | $ | 72,896 | $ | 18,877 | $ | — | $ | 173 | $ | — | $ | — | $ | — | $ | — | $ | 977 | $ | 92,923 | ||||||||||||||||||||
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| For the Fiscal Year Ended September 30, 2016 | ||||||||||||||||||||||||||||||||||||||||
| Income (Loss) from Operations | Depreciation and Amortization | Share Compensation | (Gain) Loss on Disposition of Assets | Severance | Pre-Opening | Impairment | Relinquishment Liability Reassessment | Adjusted EBITDA Attributable to Non-controlling Interests | Adjusted EBITDA | |||||||||||||||||||||||||||||||
Mohegan Sun | $ | 237,605 | $ | 61,017 | $ | — | $ | 167 | $ | — | $ | 723 | $ | 1,875 | $ | — | $ | 794 | $ | 302,181 | ||||||||||||||||||||
Mohegan Sun Pocono | 41,445 | 11,823 | — | 13 | — | — | — | — | — | 53,281 | ||||||||||||||||||||||||||||||
Corporate | (17,907 | ) | 1,073 | 6,147 | — | — | — | — | — | (1,375 | ) | (12,062 | ) | |||||||||||||||||||||||||||
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Total | $ | 261,143 | $ | 73,913 | $ | 6,147 | $ | 180 | $ | — | $ | 723 | $ | 1,875 | $ | — | $ | (581 | ) | $ | 343,400 | |||||||||||||||||||
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| For the Fiscal Year Ended September 30, 2015 | ||||||||||||||||||||||||||||||||||||||||
| Income (Loss) from Operations | Depreciation and Amortization | Share Compensation | (Gain) Loss on Disposition of Assets | Severance | Pre-Opening | Impairment | Relinquishment Liability Reassessment | Adjusted EBITDA Attributable to Non-controlling Interests | Adjusted EBITDA | |||||||||||||||||||||||||||||||
Mohegan Sun | $ | 212,211 | $ | 64,520 | $ | — | $ | 1,022 | $ | 3,244 | $ | — | $ | 2,502 | $ | (243 | ) | $ | 835 | $ | 284,091 | |||||||||||||||||||
Mohegan Sun Pocono | 45,817 | 12,007 | — | (4 | ) | 126 | — | — | — | — | 57,946 | |||||||||||||||||||||||||||||
Corporate | (24,853 | ) | 1,053 | — | — | — | — | — | — | 1,420 | (22,380 | ) | ||||||||||||||||||||||||||||
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Total | $ | 233,175 | $ | 77,580 | $ | — | $ | 1,018 | $ | 3,370 | $ | — | $ | 2,502 | $ | (243 | ) | $ | 2,255 | $ | 319,657 | |||||||||||||||||||
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Adjusted EBITDA Explanation:
Net income before interest, income taxes, depreciation and amortization, or EBITDA, is a commonly used measure of performance in the casino and hospitality industry. EBITDA is not a measure of performance calculated in accordance with GAAP. The Authority historically has evaluated its operating performance with the non-GAAP measure, Adjusted EBITDA, which as used in this press release, represents net income before interest, depreciation and amortization, share compensation expense, gain or loss on disposition of assets, workforce reduction severance, pre-opening costs and expenses, impairment charges, reassessment and accretion of discount to a relinquishment liability, loss on modification and early extinguishment of debt, income or loss from unconsolidated affiliates, other non-operating income and expense and Adjusted EBITDA attributable to non-controlling interests.
Adjusted EBITDA provides an additional way to evaluate the Authority’s operations and, when viewed with both the Authority’s GAAP results and the reconciliations provided, the Authority believes that it provides a more complete understanding of its business than could be otherwise obtained absent this disclosure. Adjusted EBITDA is presented solely as a supplemental disclosure because: (1) the Authority believes it enhances an overall understanding of the Authority’s past and current financial performance; (2) the Authority believes it is a useful tool for investors to assess the operating performance of the business in comparison to other operators within the casino and hospitality industry since Adjusted EBITDA excludes certain items that may not be indicative of the Authority’s operating results; (3) measures that are comparable to Adjusted EBITDA are often used as an important basis for the valuation of casino and hospitality companies; and (4) the Authority uses Adjusted EBITDA internally to evaluate the performance of its operating personnel and management and as a benchmark to evaluate its operating performance in comparison to its competitors.
The use of Adjusted EBITDA has certain limitations. Adjusted EBITDA should be considered in addition to, not as a substitute for or superior to, any GAAP financial measure including net income (as an indicator of the Authority’s performance) or cash flows provided by operating activities (as an indicator of the Authority’s liquidity), nor should it be considered as an indicator of the Authority’s overall financial performance. The Authority’s calculation of Adjusted EBITDA is likely to be different from the calculation of Adjusted EBITDA or other similarly titled measurements used by other casino and hospitality companies, and therefore, comparability may be limited. Adjusted EBITDA eliminates certain items from net income, such as interest and depreciation and amortization. Each of these items has been incurred in the past, will continue to be incurred in the future and should be considered in the overall evaluation of the Authority’s results. The Authority compensates for these limitations by providing relevant disclosures of items excluded in the calculation of Adjusted EBITDA, both in its reconciliations to the GAAP financial measure of net income and in its consolidated financial statements, all of which should be considered when evaluating its results. The Authority strongly encourages investors to review its financial information in its entirety and not to rely on a single financial measure.
Contacts:
Robert J. Soper
President and Chief Executive Officer
Mohegan Tribal Gaming Authority
(860) 862-8000
Mario C. Kontomerkos
Chief Financial Officer
Mohegan Tribal Gaming Authority
(860) 862-8000