Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 31, 2016 | May. 09, 2016 | |
Document and Entity Information [Abstract] | ||
Entity Registrant Name | PINNACLE ENTERTAINMENT, INC. | |
Entity Central Index Key | 1,656,239 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Non-accelerated Filer | |
Document Type | 10-Q | |
Document Period End Date | Mar. 31, 2016 | |
Document Fiscal Year Focus | 2,016 | |
Document Fiscal Period Focus | Q1 | |
Amendment Flag | false | |
Entity Common Stock, Shares Outstanding | 61,054,313 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Revenues: | ||
Gaming | $ 520,841 | $ 514,347 |
Food and beverage | 31,995 | 32,030 |
Lodging | 11,247 | 11,495 |
Retail, entertainment and other | 15,942 | 14,967 |
Total revenues | 580,025 | 572,839 |
Expenses and other costs: | ||
Gaming | 267,133 | 264,885 |
Food and beverage | 29,910 | 29,167 |
Lodging | 5,608 | 5,788 |
Retail, entertainment and other | 4,513 | 5,090 |
General and administrative | 104,862 | 102,290 |
Depreciation and amortization | 54,096 | 67,831 |
Pre-opening, development and other costs | 5,329 | 1,567 |
Write-downs, reserves and recoveries, net | 2,890 | 3,144 |
Total expenses and other costs | 474,341 | 479,762 |
Operating income | 105,684 | 93,077 |
Interest expense, net | (59,793) | (61,083) |
Loss from equity method investment | 0 | (83) |
Income from continuing operations before income taxes | 45,891 | 31,911 |
Income tax expense | (4,998) | (4,832) |
Income from continuing operations | 40,893 | 27,079 |
Income from discontinued operations, net of income taxes | 125 | 217 |
Net income | 41,018 | 27,296 |
Net loss attributable to non-controlling interest | (8) | (10) |
Net income attributable to Pinnacle Entertainment, Inc. | $ 41,026 | $ 27,306 |
Net income per common share—basic | ||
Income from continuing operations (in dollars per share) | $ 0.67 | $ 0.45 |
Income from discontinued operations, net of income taxes (in dollars per share) | 0 | 0 |
Net income per common share—basic (in dollars per share) | 0.67 | 0.45 |
Net income per common share—diluted | ||
Income from continuing operations (in dollars per share) | 0.65 | 0.44 |
Income from discontinued operations, net of income taxes (in dollars per share) | 0 | 0 |
Net income per common share—diluted (in dollars per share) | $ 0.65 | $ 0.44 |
Number of shares—basic | 61,362 | 60,508 |
Number of shares—diluted | 63,571 | 62,396 |
CONDENSED CONSOLIDATED STATEME3
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Statement of Comprehensive Income [Abstract] | ||
Net income | $ 41,018 | $ 27,296 |
Comprehensive income | 41,018 | 27,296 |
Comprehensive loss attributable to non-controlling interest | (8) | (10) |
Comprehensive income attributable to Pinnacle Entertainment, Inc. | $ 41,026 | $ 27,306 |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Mar. 31, 2016 | Dec. 31, 2015 |
Current Assets: | ||
Cash and cash equivalents | $ 121,317 | $ 164,034 |
Accounts receivable, net of allowance for doubtful accounts of $9,736 and $9,445 | 25,195 | 33,594 |
Inventories | 9,662 | 10,309 |
Income tax receivable, net | 0 | 1,133 |
Prepaid expenses and other assets | 24,566 | 14,624 |
Assets held for sale and assets of discontinued operations | 9,780 | 9,938 |
Total current assets | 190,520 | 233,632 |
Land, buildings, vessels and equipment, net | 2,823,364 | 2,856,011 |
Goodwill | 914,525 | 914,525 |
Intangible assets, net | 476,573 | 479,543 |
Other assets, net | 46,274 | 47,200 |
Total assets | 4,451,256 | 4,530,911 |
Current Liabilities: | ||
Accounts payable | 35,733 | 67,297 |
Accrued interest | 69,787 | 50,091 |
Accrued compensation | 55,073 | 74,069 |
Accrued taxes | 38,704 | 38,910 |
Other accrued liabilities | 92,875 | 84,872 |
Current portion of long-term debt | 11,006 | 11,006 |
Total current liabilities | 303,178 | 326,245 |
Long-term debt less current portion | 3,514,731 | 3,616,729 |
Other long-term liabilities | 33,139 | 36,605 |
Deferred income taxes | 191,340 | 187,823 |
Total liabilities | $ 4,042,388 | $ 4,167,402 |
Commitments and contingencies | ||
Stockholders’ Equity: | ||
Preferred stock—$1.00 par value, 250,000 shares authorized, none issued or outstanding | $ 0 | $ 0 |
Common stock—$0.10 par value, 150,000,000 authorized, 61,074,913 and 60,870,749 shares issued and outstanding, net of treasury shares | 6,745 | 6,724 |
Additional paid-in capital | 1,126,981 | 1,122,661 |
Accumulated deficit | (664,293) | (705,319) |
Accumulated other comprehensive income | 408 | 408 |
Treasury stock, at cost, 6,374,882 of treasury shares for both periods | (71,090) | (71,090) |
Total Pinnacle stockholders’ equity | 398,751 | 353,384 |
Non-controlling interest | 10,117 | 10,125 |
Total stockholders’ equity | 408,868 | 363,509 |
Total liabilities and stockholders’ equity | $ 4,451,256 | $ 4,530,911 |
CONDENSED CONSOLIDATED BALANCE5
CONDENSED CONSOLIDATED BALANCE SHEETS (PARENTHETICAL) - USD ($) $ in Thousands | Mar. 31, 2016 | Dec. 31, 2015 |
Statement of Financial Position [Abstract] | ||
Allowance for doubtful accounts | $ 9,736 | $ 9,445 |
Preferred stock, par value per share (in dollars per share) | $ 1 | $ 1 |
Preferred stock, shares authorized | 250,000 | 250,000 |
Preferred stock, shares issued | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 |
Common stock, par value per share (in dollars per share) | $ 0.10 | $ 0.10 |
Common stock, shares authorized | 150,000,000 | 150,000,000 |
Common stock, shares issued | 61,074,913 | 60,870,749 |
Common stock, shares outstanding | 61,074,913 | 60,870,749 |
Treasury stock, shares | 6,374,882 | 6,374,882 |
CONDENSED CONSOLIDATED STATEME6
CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY - 3 months ended Mar. 31, 2016 - USD ($) shares in Thousands, $ in Thousands | Total | Capital Stock | Additional Paid-In Capital | Accumulated Deficit | Accumulated Other Comprehensive Income | Treasury Stock | Total Pinnacle Stockholders’ Equity | Non-Controlling Interest |
Beginning balance, shares at Dec. 31, 2015 | 60,871 | |||||||
Beginning balance at Dec. 31, 2015 | $ 363,509 | $ 6,724 | $ 1,122,661 | $ (705,319) | $ 408 | $ (71,090) | $ 353,384 | $ 10,125 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Net income (loss) | 41,018 | 41,026 | 41,026 | (8) | ||||
Share-based compensation | 4,351 | 4,351 | 4,351 | |||||
Common stock issuance and option exercises, shares | 204 | |||||||
Common stock issuance and option exercises | 829 | $ 21 | 808 | 829 | ||||
Tax withholding related to vesting of restricted stock units | (839) | (839) | (839) | |||||
Ending balance, shares at Mar. 31, 2016 | 61,075 | |||||||
Ending balance at Mar. 31, 2016 | $ 408,868 | $ 6,745 | $ 1,126,981 | $ (664,293) | $ 408 | $ (71,090) | $ 398,751 | $ 10,117 |
CONDENSED CONSOLIDATED STATEME7
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Cash flows from operating activities: | ||
Net income | $ 41,018 | $ 27,296 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Depreciation and amortization | 54,096 | 67,831 |
Loss on sales or disposals of long-lived assets, net | 2,716 | 383 |
Loss from equity method investment | 0 | 83 |
Impairment of land, buildings, vessels and equipment | 174 | 2,769 |
Amortization of debt issuance costs and debt discounts/premiums | 4,143 | 1,608 |
Share-based compensation expense | 4,351 | 4,145 |
Change in income taxes | 4,990 | 23,351 |
Changes in operating assets and liabilities: | ||
Receivables, net | 8,232 | (1,328) |
Prepaid expenses and other | (8,266) | 12 |
Accounts payable, accrued expenses and other | (25,986) | (13,053) |
Net cash provided by operating activities | 85,468 | 113,097 |
Cash flows from investing activities: | ||
Capital expenditures | (21,884) | (21,118) |
Net proceeds from disposition of asset held for sale | 325 | 0 |
Proceeds from sales of property and equipment | 0 | 294 |
Loans receivable | (750) | (750) |
Net cash used in investing activities | (22,309) | (21,574) |
Cash flows from financing activities: | ||
Proceeds from credit facility | 64,000 | 35,000 |
Repayments under credit facility | (169,250) | (137,750) |
Proceeds from common stock options exercised | 215 | 6,146 |
Other | (841) | (252) |
Net cash used in financing activities | (105,876) | (96,856) |
Change in cash and cash equivalents | (42,717) | (5,333) |
Cash and cash equivalents at the beginning of the period | 164,034 | 164,654 |
Cash and cash equivalents at the end of the period | 121,317 | 159,321 |
Supplemental Cash Flow Information: | ||
Cash paid for interest, net of amounts capitalized | 36,011 | 39,465 |
Cash payments (refunds) related to income taxes, net | 14 | (17,379) |
Decrease in construction-related deposits and liabilities | (491) | (5,617) |
Non-cash issuance of common stock | $ 614 | $ 260 |
Organization and Summary of Sig
Organization and Summary of Significant Accounting Policies | 3 Months Ended |
Mar. 31, 2016 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization and Summary of Significant Accounting Policies | Organization and Summary of Significant Accounting Policies Organization. Pinnacle Entertainment, Inc., is an owner, operator and developer of casinos and related hospitality and entertainment businesses. References in these footnotes to “Pinnacle,” “OpCo,” the “Company,” “we,” “our” or “us” refer to Pinnacle Entertainment, Inc. and its subsidiaries, except where stated or the context otherwise indicates. References to “Former Pinnacle” refer to Pinnacle Entertainment, Inc. prior to the Spin-Off and Merger (as such terms are defined below). We own and operate 15 gaming businesses, located in Colorado, Indiana, Iowa, Louisiana, Mississippi, Missouri, Nevada, and Ohio. We also hold a majority interest in the racing license owner, and we are a party to a management contract, for Retama Park Racetrack located outside of San Antonio, Texas. In addition to these properties, we own and operate a live and televised poker tournament series under the trade name Heartland Poker Tour. We view each of our operating properties as an operating segment with the exception of our two properties in Jackpot, Nevada, which we view as one operating segment. For financial reporting purposes, we aggregate our operating segments into the following reportable segments: Midwest segment, which includes: Location Ameristar Council Bluffs Council Bluffs, Iowa Ameristar East Chicago East Chicago, Indiana Ameristar Kansas City Kansas City, Missouri Ameristar St. Charles St. Charles, Missouri River City St. Louis, Missouri Belterra Florence, Indiana Belterra Park Cincinnati, Ohio South segment, which includes: Location Ameristar Vicksburg Vicksburg, Mississippi Boomtown Bossier City Bossier City, Louisiana Boomtown New Orleans New Orleans, Louisiana L’Auberge Baton Rouge Baton Rouge, Louisiana L’Auberge Lake Charles Lake Charles, Louisiana West segment, which includes: Location Ameristar Black Hawk Black Hawk, Colorado Cactus Petes and Horseshu Jackpot, Nevada On April 28, 2016, we completed the transactions under the terms of a definitive agreement (the “Merger Agreement”) with Gaming and Leisure Properties, Inc. (“GLPI”), a real estate investment trust. Pursuant to the terms of the Merger Agreement, Former Pinnacle separated its operating assets and liabilities (and its Belterra Park property and excess land at certain locations) into a newly formed subsidiary named PNK Entertainment, Inc. (“OpCo”) and distributed to its stockholders, on a pro rata basis, all of the issued and outstanding shares of common stock of OpCo (such distribution referred to as the “Spin-Off”). As a result, its stockholders received one share of OpCo common stock, with a par value of $0.01 per share, for each share of Former Pinnacle common stock that they owned. Gold Merger Sub, LLC, a wholly owned subsidiary of GLPI (“Merger Sub”), then merged with and into Former Pinnacle (the “Merger”), with Merger Sub surviving the Merger as a wholly owned subsidiary of GLPI. Following the Merger, OpCo was renamed Pinnacle Entertainment, Inc., and is now the operator of the gaming facilities acquired by GLPI under a triple-net master lease agreement (the “Master Lease”). For more information regarding the Spin-Off and Merger, see Note 6, “Investment, Restructuring and Acquisition Activities.” Former Pinnacle’s historical Consolidated Financial Statements and accompanying notes thereto have been determined to represent OpCo based on the conclusion that, for accounting purposes, the Spin-Off should be evaluated as the reverse of its legal form under the requirements of Accounting Standards Codification (“ASC”) Subtopic 505-60, Spinoffs and Reverse Spinoffs , resulting in OpCo being considered the accounting spinnor. In addition, the Master Lease of the gaming facilities acquired by GLPI will not qualify for sale-leaseback accounting pursuant to ASC Topic 840, Leases . Therefore, the Master Lease will be accounted for as a financing obligation and the gaming facilities will remain on OpCo’s Consolidated Financial Statements. The effect of the Spin-Off and Merger on our unaudited Condensed Consolidated Financial Statements and notes thereto will be recognized in the second quarter of 2016. Basis of Presentation. The accompanying unaudited Condensed Consolidated Financial Statements have been prepared in accordance with the instructions of the Securities and Exchange Commission (the “SEC”) to the Quarterly Report on Form 10-Q and, therefore, do not include all information and notes necessary for complete financial statements in conformity with generally accepted accounting principles in the United States (“GAAP”). The results for the periods indicated are unaudited, but reflect all adjustments, which are of a normal recurring nature, that management considers necessary for a fair presentation of operating results. The results of operations for interim periods are not indicative of a full year of operations. These unaudited Condensed Consolidated Financial Statements and notes thereto should be read in conjunction with the Consolidated Financial Statements and notes thereto included in our Information Statement included as Exhibit 99.1 to our Registration Statement on Form 10 filed with the SEC in final form on April 11, 2016. Principles of Consolidation. The unaudited Condensed Consolidated Financial Statements include the accounts of Pinnacle Entertainment, Inc. and its subsidiaries. Investments in the common stock of unconsolidated affiliates in which we have the ability to exercise significant influence are accounted for under the equity method. All intercompany accounts and transactions have been eliminated in consolidation. Use of Estimates. The preparation of unaudited Condensed Consolidated Financial Statements in conformity with GAAP requires management to make estimates and assumptions that affect (i) the reported amounts of assets and liabilities, (ii) the disclosure of contingent assets and liabilities at the date of the consolidated financial statements, and (iii) the reported amounts of revenues and expenses during the reporting period. Estimates used by us include, among other things, the estimated useful lives for depreciable and amortizable assets, the estimated allowance for doubtful accounts receivable, estimated income tax provisions, the evaluation of the future realization of deferred tax assets, determining the adequacy of reserves for self-insured liabilities and our customer loyalty programs, estimated cash flows in assessing the recoverability of long-lived assets, asset impairments, goodwill and intangible assets, contingencies and litigation, and estimates of the forfeiture rate and expected life of share-based awards and stock price volatility when computing share-based compensation expense. Actual results may differ from those estimates. Fair Value. Fair value measurements affect our accounting and impairment assessments of our long-lived assets, investments in unconsolidated affiliates, assets acquired in an acquisition, goodwill, and other intangible assets. Fair value measurements also affect our accounting for certain financial assets and liabilities. Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date and is measured according to a hierarchy that includes: “Level 1” inputs, such as quoted prices in an active market for identical assets or liabilities; “Level 2” inputs, which are observable inputs for similar assets; or “Level 3” inputs, which are unobservable inputs. The following table presents a summary of fair value measurements by level for certain liabilities measured at fair value on a recurring basis in the unaudited Condensed Consolidated Balance Sheets: Fair Value Measurements Using: Total Fair Value Level 1 Level 2 Level 3 (in millions) As of March 31, 2016 Liabilities: Deferred compensation $ 0.4 $ 0.4 $ — $ — As of December 31, 2015 Liabilities: Deferred compensation $ 0.4 $ 0.4 $ — $ — The following table presents a summary of fair value measurements by level for certain financial instruments not measured at fair value on a recurring basis in the unaudited Condensed Consolidated Balance Sheets for which it is practicable to estimate fair value: Fair Value Measurements Using: Total Carrying Amount Total Fair Value Level 1 Level 2 Level 3 (in millions) As of March 31, 2016 Assets: Held-to-maturity securities $ 14.4 $ 15.5 $ — $ 12.4 $ 3.1 Promissory notes $ 14.9 $ 19.4 $ — $ 19.4 $ — Liabilities: Long-term debt $ 3,525.7 $ 3,673.0 $ — $ 3,673.0 $ — As of December 31, 2015 Assets: Held-to-maturity securities $ 14.4 $ 15.2 $ — $ 12.1 $ 3.1 Promissory notes $ 14.1 $ 19.2 $ — $ 19.2 $ — Liabilities: Long-term debt $ 3,627.7 $ 3,740.6 $ — $ 3,740.6 $ — The estimated fair values for certain of our long-term held-to-maturity securities and our long-term promissory notes were based on Level 2 inputs using observable market data for comparable instruments in establishing prices. The estimated fair values for certain of our long-term held-to-maturity securities were based on Level 3 inputs using a present value of future cash flow valuation technique that relies on management assumptions and qualitative observations. Key significant unobservable inputs in this technique include discount rate risk premiums and probability-weighted cash flow scenarios. The estimated fair values of our long-term debt, which includes the fair value of our senior notes, senior subordinated notes, senior secured credit facility and term loans, were based on Level 2 inputs of observable market data on comparable debt instruments on or about March 31, 2016 and December 31, 2015 . The fair values of our short-term financial instruments approximate the carrying amounts due to their short-term nature. Land, Buildings, Vessels and Equipment. Land, buildings, vessels and equipment are stated at cost. Land includes land not currently being used in our operations, which totaled $35.8 million as of March 31, 2016 . We capitalize the costs of improvements that extend the life of the asset. We expense repair and maintenance costs as incurred. Gains or losses on the disposition of land, buildings, vessels and equipment are included in the determination of income. We review the carrying amounts of our land, buildings, vessels and equipment used in our operations whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable from estimated future undiscounted cash flows expected to result from its use and eventual disposition. If the undiscounted cash flows exceed the carrying amount, no impairment is indicated. If the undiscounted cash flows do not exceed the carrying amount, then an impairment charge is recorded based on the fair value of the asset. Development costs directly associated with the acquisition, development, and construction of a project are capitalized as a cost of the project during the periods in which activities necessary to get the property ready for its intended use are in progress. The costs incurred for development projects are carried at cost. Interest costs associated with development projects are capitalized as part of the cost of the constructed asset. When no debt is incurred specifically for a project, interest is capitalized on amounts expended for the project using our weighted-average cost of borrowing. Capitalization of interest ceases when the project, or discernible portion of the project, is substantially complete. If substantially all of the construction activities of a project are suspended, capitalization of interest will cease until such activities are resumed. The following table presents a summary of our land, buildings, vessels and equipment: March 31, December 31, (in millions) Land, buildings, vessels and equipment: Land and land improvements $ 424.6 $ 422.8 Buildings, vessels and improvements 2,675.3 2,674.6 Furniture, fixtures and equipment 767.5 763.8 Construction in progress 37.2 33.2 Land, buildings, vessels and equipment, gross 3,904.6 3,894.4 Less: accumulated depreciation (1,081.3 ) (1,038.4 ) Land, buildings, vessels and equipment, net $ 2,823.3 $ 2,856.0 Goodwill and Other Intangible Assets. Goodwill consists of the excess of the acquisition cost over the fair value of the net assets acquired in business combinations. Indefinite-lived intangible assets include gaming licenses and trade names for which it is reasonably assured that we will continue to renew indefinitely. Goodwill and other indefinite-lived intangible assets are subject to an annual assessment for impairment during the fourth quarter (October 1st test date), or more frequently if there are indications of possible impairment. Amortizing intangible assets include player relationships and favorable leasehold interests. We review amortizing intangible assets for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. As a result of the Spin-Off and Merger, we will test our reporting unit goodwill and other indefinite-lived intangible assets for impairment. This testing may result in a significant non-cash impairment charge to our goodwill or our other indefinite-lived intangible assets, which would be recognized during the second quarter of 2016. Customer Loyalty Programs. We offer incentives to our customers through our my choice customer loyalty program. Under the my choice customer loyalty program, customers earn points based on their level of play that may be redeemed for various benefits, such as cash back, dining, or hotel stays, among others. The reward credit balance under the plan will be forfeited if the customer does not earn or use any reward credits over the prior six-month period. In addition, based on their level of play, customers can earn additional benefits without redeeming points, such as a car lease, among other items. We accrue a liability for the estimated cost of providing these benefits as the benefits are earned. Estimates and assumptions are made regarding cost of providing the benefits, breakage rates, and the combination of goods and services customers will choose. We use historical data to assist in the determination of estimated accruals. Changes in estimates or customer redemption habits could produce different results. As of March 31, 2016 and December 31, 2015 , we had accrued $27.0 million and $25.4 million , respectively, for the estimated cost of providing these benefits, which are included in “Other accrued liabilities” in our unaudited Condensed Consolidated Balance Sheets. Revenue Recognition. Gaming revenues consist of the net win from gaming activities, which is the difference between amounts wagered and amounts paid to winning patrons. Cash discounts and other cash incentives to customers related to gaming play are recorded as a reduction to gaming revenue. Food and beverage, lodging, retail, entertainment, and other operating revenues are recognized as products are delivered or services are performed. Advance deposits on lodging are recorded as accrued liabilities until services are provided to the customer. The retail value of food and beverage, lodging and other services furnished to guests on a complimentary basis is included in revenues and then deducted as promotional allowances in calculating total revenues. The estimated cost of providing such promotional allowances is primarily included in gaming expenses. Complimentary revenues that have been excluded from the accompanying unaudited Condensed Consolidated Statements of Operations were as follows: For the three months ended March 31, 2016 2015 (in millions) Food and beverage $ 33.8 $ 35.2 Lodging 15.8 15.2 Other 3.7 4.4 Total promotional allowances $ 53.3 $ 54.8 The costs to provide such complimentary benefits were as follows: For the three months ended March 31, 2016 2015 (in millions) Promotional allowance costs included in gaming expense $ 38.2 $ 39.3 Gaming Taxes. We are subject to taxes based on gross gaming revenues in the jurisdictions in which we operate, subject to applicable jurisdictional adjustments. These gaming taxes are an assessment on our gaming revenues and are recorded as a gaming expense in our unaudited Condensed Consolidated Statements of Operations. These taxes were as follows: For the three months ended March 31, 2016 2015 (in millions) Gaming taxes $ 145.8 $ 144.7 Pre-opening, Development and Other Costs. Pre-opening, development and other costs consist of payroll costs to hire, employ and train the workforce prior to opening an operating facility; marketing campaigns prior to and in connection with the opening; legal and professional fees related to the project but not otherwise attributable to depreciable assets; lease payments; real estate taxes; acquisition costs; restructuring costs; and other costs prior to the opening of an operating facility. Pre-opening, development and other costs are expensed as incurred. Pre-opening, development and other costs consist of the following: For the three months ended March 31, 2016 2015 (in millions) Restructuring costs (1) $ 3.5 $ 0.7 Meadows acquisition costs (2) 1.7 — Other 0.1 0.9 Total pre-opening, development and other costs $ 5.3 $ 1.6 (1) Amounts comprised of costs associated with the separation of Former Pinnacle’s real estate assets from its operating assets. See Note 6, “Investment, Restructuring and Acquisition Activities.” (2) Amount comprised of costs associated with the Company’s acquisition of The Meadows Racetrack and Casino (“Meadows”) business. See Note 6, “Investment, Restructuring and Acquisition Activities.” Earnings Per Share. The computation of basic and diluted earnings per share is based on net income attributable to Pinnacle Entertainment, Inc. divided by the basic weighted average number of common shares and diluted weighted average number of common shares, respectively. Diluted earnings per share reflect the addition of potentially dilutive securities, which include in-the-money share-based awards. We calculate the effect of dilutive securities using the treasury stock method. A total of 1.1 million and 1.4 million out-of-the-money share-based awards were excluded from the calculation of diluted earnings per share for the three months ended March 31, 2016 , and 2015 , respectively, because including them would have been anti-dilutive. Reclassifications. The unaudited Condensed Consolidated Financial Statements reflect certain reclassifications to prior year amounts to conform to classification in the current period. These reclassifications had no effect on the previously reported net income. Recently Issued Accounting Pronouncements In May 2014, as part of its ongoing efforts to assist in the convergence of GAAP and International Financial Reporting Standards, the Financial Accounting Standards Board (the “FASB”) issued Accounting Standards Update (“ASU”) 2014-09, Revenue from Contracts with Customers , which is a new standard related to revenue recognition. Under the new standard, recognition of revenue occurs when a customer obtains control of promised services or goods in an amount that reflects the consideration to which the entity expects to receive in exchange for those goods or services. In addition, the standard requires disclosure of the nature, amount, timing, and uncertainty of revenue and cash flows arising from customer contracts. The standard must be adopted using either a full retrospective approach for all periods presented in the period of adoption or a modified retrospective approach. In July 2015, the FASB issued ASU 2015-14, Revenue from Contracts with Customers - Deferral of the Effective Date , which defers the implementation of this new standard to be effective for fiscal years beginning after December 15, 2017. In March 2016, the FASB issued ASU 2016-08, Principal versus Agent Considerations , which clarifies the implementation guidance on principal versus agent considerations in the new revenue recognition standard pursuant to ASU 2014-09. In April 2016, the FASB issued ASU 2016-10, Identifying Performance Obligations and Licensing , and in May 2016, the FASB issued ASU 2016-12, Narrow-Scope Improvements and Practical Expedients, which amend certain aspects of the new revenue recognition standard pursuant to ASU 2014-09. We are currently evaluating which transition approach we will utilize and the impact of adopting this accounting standard on our unaudited Condensed Consolidated Financial Statements. In June 2014, the FASB issued ASU 2014-12, Accounting for Share-Based Payments when the Terms of an Award Provide that a Performance Target Could be Achieved after the Requisite Service Period . This ASU requires that a performance target that affects vesting, and that could be achieved after the requisite service period, be treated as a performance condition. As such, the performance target should not be reflected in estimating the grant date fair value of the award. This update further clarifies that compensation cost should be recognized in the period in which it becomes probable that the performance target will be achieved and should represent the compensation cost attributable to the period or periods for which the requisite service has already been rendered. We adopted this guidance during the first quarter of 2016 using a prospective transition approach and it did not have a material impact on our unaudited Condensed Consolidated Financial Statements. In February 2015, the FASB issued ASU No. 2015-02, Amendments to the Consolidation Analysis , which amends 1) the assessment of whether a limited partnership is a variable interest entity; 2) the effect that fees paid to a decision maker have on the consolidation analysis; 3) how variable interests held by a reporting entity’s related parties or de facto agents affect its consolidation conclusion; and 4) for entities other than limited partnerships, clarifies how to determine whether the equity holders as a group have power over an entity. We adopted this guidance during the first quarter of 2016 and it did not have a material impact on our unaudited Condensed Consolidated Financial Statements. In September 2015, the FASB issued ASU No. 2015-16, Simplifying the Accounting for Measurement-Period Adjustments , which requires that an acquirer recognize adjustments to provisional amounts that are identified during the measurement period in the reporting period in which the adjustment amounts are determined. We adopted this guidance during the first quarter of 2016 and it did not have a material impact on our unaudited Condensed Consolidated Financial Statements. In January 2016, the FASB issued ASU No. 2016-01, Recognition and Measurement of Financial Assets and Financial Liabilities , which addresses certain aspects of recognition, measurement, presentation, and disclosure of financial instruments. The effective date for this update is for the annual and interim periods beginning after December 15, 2017, with early adoption not permitted. We are currently evaluating the impact of adopting this accounting standard on our unaudited Condensed Consolidated Financial Statements. In February 2016, the FASB issued ASU No. 2016-02, Recognition and Measurement of Leases . Under the new guidance, for all leases (with the exception of short-term leases), at the commencement date, lessees will be required to recognize a lease liability, which is a lessee’s obligation to make lease payments arising from a lease, measured on a discounted basis, and a right-of-use asset, which is an asset that represents the lessee’s right to use, or control the use of, a specified asset for the lease term. Under the new guidance, lessor accounting is largely unchanged. Further, the new lease guidance simplifies the accounting for sale and leaseback transactions primarily because lessees must recognize lease assets and liabilities, which no longer provides a source for off balance sheet financing. The effective date for this update is for the annual and interim periods beginning after December 15, 2018 with early adoption permitted. Lessees and lessors must apply a modified retrospective transition approach for leases existing at, or entered into after, the beginning of the earliest comparative period presented in the financial statements. We are currently evaluating the impact of adopting this accounting standard on our unaudited Condensed Consolidated Financial Statements. In March 2016, the FASB issued ASU No. 2016-06, Contingent Put and Call Options in Debt Instruments , which clarifies the requirements for assessing whether contingent call or put options that can accelerate the payment of principal on debt instruments are clearly and closely related to their debt hosts. The effective date for this update is for the annual and interim periods beginning after December 15, 2016, with early adoption permitted. We are currently evaluating the impact of adopting this accounting standard on our unaudited Condensed Consolidated Financial Statements. In March 2016, the FASB issued ASU No. 2016-07, Investments - Equity Method and Joint Ventures (Topic 323): Simplifying the Transition to the Equity Method of Accounting , which, among other things, eliminates the requirement that when an investment qualifies for use of the equity method as a result of an increase in the level of ownership interest or degree of influence, an investor must adjust the investment, results of operations, and retained earnings retroactively on a step-by-step basis as if the equity method had been in effect during all previous periods that the investment had been held. The effective date for this update is for the annual and interim periods beginning after December 15, 2016, with early adoption permitted. We are currently evaluating the impact of adopting this accounting standard on our unaudited Condensed Consolidated Financial Statements. In March 2016, the FASB issued ASU No. 2016-09, Improvements to Employee Share-Based Payment Accounting , which simplifies several aspects of the accounting for employee share-based payment transactions, including the accounting for income taxes, forfeitures, and statutory tax withholding requirements, as well as classification in the statement of cash flows. The effective date for this update is for the annual and interim periods beginning after December 15, 2016, with early adoption permitted. We are currently evaluating the impact of adopting this accounting standard on our unaudited Condensed Consolidated Financial Statements. A variety of proposed or otherwise potential accounting standards are currently under review and study by standard-setting organizations and certain regulatory agencies. Given the tentative and preliminary nature of such proposed standards, we have not yet determined the effect, if any, that the implementation of any such proposed or revised standards would have on our unaudited Condensed Consolidated Financial Statements. |
Long-Term Debt
Long-Term Debt | 3 Months Ended |
Mar. 31, 2016 | |
Debt Disclosure [Abstract] | |
Long-Term Debt | Long-Term Debt Long-term debt consisted of the following: March 31, 2016 Outstanding Principal Unamortized (Discount) Premium Unamortized Debt Issuance Costs Long-Term Debt, Net (in millions) Senior Secured Credit Facility: Revolving Credit Facility due 2018 $ 750.1 $ — $ — $ 750.1 B-2 Term Loans due 2020 197.0 (7.4 ) (1.7 ) 187.9 6.375% Senior Notes due 2021 850.0 — (12.5 ) 837.5 7.50% Senior Notes due 2021 1,040.0 44.8 — 1,084.8 7.75% Senior Subordinated Notes due 2022 325.0 — (4.6 ) 320.4 8.75% Senior Subordinated Notes due 2020 350.0 — (5.1 ) 344.9 Other 0.1 — — 0.1 Total debt including current maturities 3,512.2 37.4 (23.9 ) 3,525.7 Less: current maturities (11.0 ) — — (11.0 ) Total long-term debt $ 3,501.2 $ 37.4 $ (23.9 ) $ 3,514.7 December 31, 2015 Outstanding Principal Unamortized (Discount) Premium Unamortized Debt Issuance Costs Long-Term Debt, Net (in millions) Senior Secured Credit Facility: Revolving Credit Facility due 2018 $ 750.1 $ — $ — $ 750.1 B-2 Term Loans due 2020 302.2 (10.9 ) (2.4 ) 288.9 6.375% Senior Notes due 2021 850.0 — (13.0 ) 837.0 7.50% Senior Notes due 2021 1,040.0 46.7 — 1,086.7 7.75% Senior Subordinated Notes due 2022 325.0 — (4.7 ) 320.3 8.75% Senior Subordinated Notes due 2020 350.0 — (5.4 ) 344.6 Other 0.1 — — 0.1 Total debt including current maturities 3,617.4 35.8 (25.5 ) 3,627.7 Less: current maturities (11.0 ) — — (11.0 ) Total long-term debt $ 3,606.4 $ 35.8 $ (25.5 ) $ 3,616.7 Senior Secured Credit Facility: In August 2013, we entered into an Amended and Restated Credit Agreement (“Credit Facility”), which amended and restated our Fourth Amended and Restated Credit Agreement dated as of August 2, 2011, as amended. The Credit Facility consists of (i) $1.6 billion of term loans comprised of $500.0 million of Tranche B-1 term loans and $1.1 billion of Tranche B-2 term loans and (ii) a $1.0 billion revolving credit commitment. As of March 31, 2016 , we had approximately $750.1 million drawn under the $1.0 billion revolving credit facility, approximately $197.0 million in outstanding principal balance of Tranche B-2 term loans, and approximately $12.0 million committed under various letters of credit under our Credit Facility. We fully repaid the principal balance of our Tranche B-1 term loans during 2014. The outstanding principal on the Tranche B-2 term loans was discounted on issuance for the reduction in the proceeds received when the transaction was consummated. 6.375% Senior Notes due 2021: In August 2013, we issued $850.0 million in aggregate principal amount of 6.375% senior notes due 2021 (“ 6.375% Notes”) to fund the acquisition of Ameristar Casinos, Inc. (“Ameristar”). The 6.375% Notes bore interest at a rate of 6.375% per year, payable semi-annually in arrears on February 1st and August 1st of each year. Net of initial purchasers’ fees and various costs and expenses, proceeds from the offering were approximately $835.0 million . 7.50% Senior Notes due 2021: As part of the acquisition of Ameristar, we assumed $1.04 billion in aggregate principal amount of 7.50% Senior Notes due 2021 (“ 7.50% Notes”) that were originally issued by Ameristar. The 7.50% Notes bore interest at a rate of 7.50% per year, payable semi-annually in arrears on April 15th and October 15th of each year. The 7.50% Notes were recorded at fair value as part of the purchase price allocation with a premium of $72.8 million . In addition, a consent fee payment to the holders of the 7.50% Notes at acquisition was included as a discount component of the total carrying amount. 7.75% Senior Subordinated Notes due 2022: In March 2012, we issued $325.0 million in aggregate principal amount of 7.75% senior subordinated notes due 2022 (“ 7.75% Notes”). The 7.75% Notes were issued at par with interest payable on April 1st and October 1st of each year. Net of initial purchasers’ fees and various costs and expenses, proceeds from the offering were approximately $318.3 million . 8.75% Senior Subordinated Notes due 2020: In May 2010, we issued $350.0 million in aggregate principal amount of 8.75% senior subordinated notes due 2020 (“ 8.75% Notes”). The 8.75% Notes were issued at par with interest payable on May 15th and November 15th of each year. Net of the initial purchasers’ fees and various costs and expenses, proceeds from the offering were approximately $341.5 million . Financing in Connection with the Spin-Off and Merger In connection with the Spin-Off and Merger, the Company made a dividend to Former Pinnacle in the amount of $808.4 million (the “Cash Payment”), which was equal to the amount of existing debt outstanding of Former Pinnacle at the time of the closing of the Merger, less $2.7 billion that GLPI assumed pursuant to the Merger Agreement. Immediately prior to the consummation of the Spin-Off and Merger, Former Pinnacle’s Credit Facility was repaid in full and terminated and its 6.375% Notes, 7.50% Notes and 7.75% Notes were redeemed. Former Pinnacle’s indenture governing its 8.75% Notes will be redeemed on May 15, 2016. Following the consummation of the Spin-Off and Merger, the Company had no outstanding obligations under Former Pinnacle’s Credit Facility, the 6.375% Notes, the 7.50% Notes, the 7.75% Notes and the 8.75% Notes. On April 28, 2016, the Company completed its debt financings in connection with the Merger, consisting of (i) $375.0 million aggregate principal amount of 5.625% senior notes due 2024 (the “ 5.625% Notes”) and (ii) the credit agreement among the Company and certain lenders thereto (the “Credit Agreement”), comprised of (x) a $185.0 million term loan A facility with a maturity of five years (the “Term Loan A Facility”), (y) a $300.0 million term loan B facility with a maturity of seven years (the “Term Loan B Facility”) and (z) a $400.0 million revolving credit facility with a maturity of five years (the “Revolving Credit Facility” and together with the Term Loan A Facility and the Term Loan B Facility, the “OpCo Credit Facilities”). Loans under the Term Loan A Facility and Revolving Credit Facility will initially bear interest at a rate per annum equal to, at our option, LIBOR plus 2.00% or the base rate plus 1.00% and, after delivery of the Company’s financial statements for the first full fiscal quarter after the closing date, such loans will bear interest at a rate per annum equal to, at our option, LIBOR plus an applicable margin from 1.50% to 2.50% or the base rate plus an applicable margin from 0.50% to 1.50% , in each case, depending on the Consolidated Total Net Leverage Ratio (as defined in the Credit Agreement) as of the most recent fiscal quarter. Loans under the Term Loan B Facility will bear interest at a rate per annum equal to, at our option, LIBOR plus 3.00% or the base rate plus 2.00% . In addition, we will pay a commitment fee on the unused portion of the commitments under the Revolving Credit Facility at a rate that will range from 0.30% to 0.50% per annum, depending on the Consolidated Total Net Leverage Ratio as of the most recent fiscal quarter. The 5.625% Notes were issued at par, mature on May 1, 2024, and bear interest at the rate of 5.625% per annum. Interest on the 5.625% Notes is payable semi-annually on May 1st and November 1st of each year, commencing November 1, 2016. The net proceeds from the offering of the 5.625% Notes, after deducting the initial purchasers’ selling commissions and the estimated offering expenses, were approximately $369.4 million . The 5.625% Notes were issued pursuant to Rule 144A and Regulation S of the Securities Act of 1933. We are required to file a registration statement on Form S-4 to register the 5.625% Notes, which must be declared effective by the SEC by July 30, 2017. The proceeds of the OpCo Credit Facilities, together with the proceeds of the 5.625% Notes were used on the closing date of the Spin-Off and Merger (i) to make the Cash Payment and (ii) to pay fees and expenses related to the issuance of the OpCo Credit Facilities and the 5.625% Notes. Proceeds from loans under the Revolving Credit Facility will be used for working capital, to fund permitted dividends, distributions and acquisitions, for general corporate purposes and for any other purpose not prohibited by the Credit Agreement. See Note 6, “Investments, Restructuring and Acquisition Activities,” for further discussion of the Spin-Off and Merger. Interest expense, net, was as follows: For the three months ended March 31, 2016 2015 (in millions) Interest expense $ 59.9 $ 61.1 Interest income (0.1 ) — Interest expense, net $ 59.8 $ 61.1 |
Income Taxes
Income Taxes | 3 Months Ended |
Mar. 31, 2016 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes Our effective tax rate for continuing operations for the three months ended March 31, 2016 , was 10.9% , or an expense of $5.0 million , as compared to an effective tax rate of 15.1% , or an expense of $4.8 million , for the corresponding prior year period. Our tax rate differs from the statutory rate of 35.0% due to the effects of permanent items, deferred tax expense on tax amortization of indefinite-lived intangible assets, state taxes, and a reserve for unrecognized tax benefits. Our state tax provision represents taxes in the jurisdictions of Indiana and Louisiana as well as the city jurisdictions in Missouri, where we have no valuation allowance. |
Employee Benefit Plans
Employee Benefit Plans | 3 Months Ended |
Mar. 31, 2016 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Employee Benefit Plans | Employee Benefit Plans Share-based Compensation: As of March 31, 2016 , we had approximately 7.4 million share-based awards outstanding, including common stock options, restricted stock units, and performance stock units, which are detailed below. Our 2015 Equity and Performance Incentive Plan has approximately 0.2 million share-based awards available for grant as of March 31, 2016 . We recorded share-based compensation expense as follows: For the three months ended March 31, 2016 2015 (in millions) Share-based compensation expense $ 4.4 $ 4.1 Stock options: The following table summarizes information related to our common stock options: Number of Stock Options Weighted Average Exercise Price Options outstanding as of January 1, 2016 5,375,476 $ 16.04 Granted — $ — Exercised (14,405 ) $ 14.90 Canceled or forfeited (2,675 ) $ 23.23 Options outstanding as of March 31, 2016 5,358,396 $ 16.04 Options exercisable as of March 31, 2016 3,766,337 $ 13.13 Expected to vest as of March 31, 2016 1,301,667 $ 23.09 The unamortized compensation costs not yet expensed related to stock options totaled approximately $11.3 million as of March 31, 2016 . The weighted average period over which the costs are expected to be recognized is approximately one year. The aggregate amount of cash we received from the exercise of stock options was $0.2 million and $6.1 million for the three months ended March 31, 2016 , and 2015, respectively. The associated shares were newly issued common stock. The following information is provided for our stock options: For the three months ended March 31, 2016 2015 Weighted-average grant date fair value $ — $ 9.44 Restricted Stock Units: The following table summarizes information related to our restricted stock units: Number of Units Weighted Average Grant Date Fair Value Non-vested as of January 1, 2016 1,311,423 $ 25.16 Granted 4,105 $ 31.68 Vested (44,579 ) $ 26.50 Canceled or forfeited (4,443 ) $ 28.74 Non-vested as of March 31, 2016 1,266,506 $ 25.12 The unamortized compensation costs not yet expensed related to non-vested restricted stock units, totaled approximately $23.4 million as of March 31, 2016 . The weighted average period over which the costs are expected to be recognized is approximately one year. Performance Stock Units: The following table summarizes information related to our performance stock units: Number of Units Weighted Average Grant Date Fair Value Non-vested as of January 1, 2016 408,228 $ 23.23 Granted — $ — Canceled or forfeited — $ — Non-vested as of March 31, 2016 408,228 $ 23.23 Share-Based Awards After the Spin-Off and Merger: As a result of the Spin-Off and Merger, each vested and non-vested equity awards granted on or prior to July 16, 2015 were converted into a combination of (1) corresponding equity awards of OpCo which will continue to vest on the same schedule as Former Pinnacle’s outstanding equity and non-equity awards based on service with OpCo and (2) fully-vested shares of common stock of GLPI. The relative split of the value of equity awards between OpCo awards and GLPI shares was based on the relative values of OpCo and Former Pinnacle prior to the Merger. The strike prices of options were also proportionately adjusted. Each of Former Pinnacle’s equity awards granted after July 16, 2015 were converted into OpCo equity awards with the same intrinsic value and will continue to vest on the same schedule as Former Pinnacle’s outstanding equity awards based on service with OpCo. |
Write-downs, Reserves and Recov
Write-downs, Reserves and Recoveries, Net | 3 Months Ended |
Mar. 31, 2016 | |
Write Downs Reserves And Recoveries Net Abstract | |
Write Downs, Reserves and Recoveries Net | Write-downs, Reserves and Recoveries, Net Write-downs, reserves and recoveries, net consist of the following: For the three months ended March 31, 2016 2015 (in millions) Loss on disposals of long-lived assets, net $ 2.7 $ 0.4 Impairment of long-lived assets 0.2 2.7 Write-downs, reserves and recoveries, net $ 2.9 $ 3.1 Loss on disposals of long-lived assets, net: During the three months ended March 31, 2016 and 2015 , we recorded net losses related primarily to disposals of furniture, fixtures and equipment at our properties in the normal course of business. Impairment of long-lived assets: During the three months ended March 31, 2016 and 2015 , we recorded non-cash impairments on slot and other equipment at our properties. Additionally, during the three months ended March 31, 2015 , we recorded a $2.6 million non-cash impairment of our land in Central City, Colorado to reduce the carrying amount of the asset to its estimated fair value less cost to sell. |
Investment, Restructuring and A
Investment, Restructuring and Acquisition Activities | 3 Months Ended |
Mar. 31, 2016 | |
Investment, Restructuring and Acquisitions [Abstract] | |
Investment, Restructuring and Acquisition Activities | Investment, Restructuring and Acquisition Activities Merger Agreement with GLPI: On April 28, 2016, we completed the transactions contemplated under the terms of the Merger Agreement, dated as of July 20, 2015. The Merger Agreement effectuated the Spin-Off of Former Pinnacle’s operations (and Belterra Park property and excess land at certain locations) into OpCo, an independent publicly traded company, after which Former Pinnacle merged with and into Gold Merger Sub, with Gold Merger Sub surviving the Merger as a wholly-owned subsidiary of GLPI. Following the Merger, OpCo was renamed Pinnacle Entertainment, Inc., and is now the operator of the gaming facilities acquired by GLPI under the Master Lease. The Master Lease has an initial term of 10 years with five subsequent, five -year renewal periods at our option. The Company will pay initial annual rent of $377 million to GLPI. In completing the Merger, each share of common stock, par value $0.10 per share, of Former Pinnacle (the “Former Pinnacle Common Stock”) issued and outstanding immediately prior to the effective time (other than shares of Former Pinnacle Common Stock (i) owned or held in treasury by Former Pinnacle or (ii) owned by GLPI, its subsidiaries or Merger Sub) were canceled and converted into the right to receive 0.85 shares of common stock, par value $0.01 per share, of GLPI. As further described in Note 2, “Long-Term Debt,” in connection with the Spin-Off and Merger, the Company made a dividend to Former Pinnacle of $808.4 million , which was equal to the amount of debt outstanding at the time of the closing of the Merger, less $2.7 billion that GLPI assumed pursuant to the Merger Agreement. Following the consummation of the Spin-Off and Merger, the Company had no outstanding obligations under Former Pinnacle’s Credit Facility, the 6.375% Notes, the 7.50% Notes, the 7.75% Notes and the 8.75% Notes. Acquisition of the Meadows Business: On March 29, 2016, we entered into a purchase agreement (the “Purchase Agreement”) with GLP Capital, L.P. (“GLPC”), a subsidiary of GLPI, pursuant to which we will acquire the Meadows located in Washington County, Pennsylvania for total consideration of approximately $138 million . Following the close of the transaction, we will own and operate the Meadows’ gaming entertainment and harness racing business subject to a triple-net lease of its underlying real property with GLPI (the “Meadows Lease”). The Meadows Lease will provide for a 10 -year initial term, including renewal terms at our option, up to a total of 29 years . The initial annual rent will be $25.5 million , comprised of a base rent of $14.0 million , which is subject to annual escalation in the future, and an initial percentage rent of $11.5 million , which will adjust every two years. The completion of the transaction is subject to various closing conditions, including obtaining the approval of the Pennsylvania Gaming Control Board and the Pennsylvania Harness Racing Commission. The Company anticipates funding the acquisition with its Revolving Credit Facility. Subject to the satisfaction or waiver of conditions in the Purchase Agreement, we expect the transaction to close by the end of the third quarter of 2016. Equity Method Investment: We have invested in a land re-vitalization project in downtown St. Louis, which is accounted for under the equity method and included in “Other assets, net” in our unaudited Condensed Consolidated Balance Sheets. As of both March 31, 2016 , and December 31, 2015 , the carrying amount of this investment was $1.7 million . Retama Park Racetrack: We hold 75.5% of the equity of Pinnacle Retama Partners, LLC (“PRP”) and consolidate the accounts of PRP in our unaudited Condensed Consolidated Financial Statements. As of March 31, 2016 , PRP held $14.9 million in promissory notes issued by Retama Development Corporation (“RDC”), a local government corporation of the City of Selma, Texas, and $11.3 million in local government corporation bonds issued by RDC, at amortized cost. The promissory notes and local government corporation bonds, which are included in “Other assets, net” in our unaudited Condensed Consolidated Balance Sheets, have long-term contractual maturities and are collateralized by the assets of the Retama Park Racetrack. The contractual terms of the promissory notes include interest payments due at maturity; however, we have not recorded accrued interest because uncertainty exists as to RDC’s ability to make the interest payments. We have the positive intent and ability to hold the local government corporation bonds to maturity and until the amortized cost basis is recovered. |
Discontinued Operations and Ass
Discontinued Operations and Assets Held for Sale | 3 Months Ended |
Mar. 31, 2016 | |
Discontinued Operations and Disposal Groups [Abstract] | |
Discontinued Operations and Assets Held for Sale | Discontinued Operations and Assets Held for Sale Assets held for sale are measured at the lower of carrying amount or estimated fair value less cost to sell. The results of operations of a component or group of components that has either been disposed of or is classified as held for sale is included in discontinued operations when certain criteria are met. During the three months ended March 31, 2016 and 2015 , income before income taxes reported in discontinued operations was $0.1 million and $0.2 million , respectively. The fair value of the assets to be sold was determined using a market approach using Level 2 inputs, as defined in Note 1, “Organization and Summary of Significant Accounting Policies.” Central City, Colorado: In March 2016, we completed the sale of approximately two acres of land in Central City, Colorado, which had a carrying amount of $0.3 million , for cash consideration of $0.3 million . This land was classified as held for sale as of December 31, 2015 . During the three months ended March 31, 2015 , in order to reduce the carrying amount of this land to its estimated fair value less cost to sell, we recorded a $2.6 million non-cash impairment charge, which is included in “Write-downs, reserves and recoveries, net” in our unaudited Condensed Consolidated Statements of Operations. Ameristar Lake Charles: In July 2013, we entered into an agreement to sell all of the equity interests of our subsidiary, which was constructing the Ameristar Lake Charles development project. In November 2013, we closed the sale of the equity interests of our subsidiary. We received approximately $209.8 million in cash consideration and $10.0 million in deferred consideration in the form of a note receivable from the buyer due in July 2016. Total assets for entities and operations classified as held for sale are summarized as follows: March 31, December 31, (in millions) Assets: Land, buildings, vessels and equipment, net $ — $ 0.3 Other assets, net 9.8 9.6 Total assets $ 9.8 $ 9.9 |
Commitments and Contingencies
Commitments and Contingencies | 3 Months Ended |
Mar. 31, 2016 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies Self-Insurance: We self-insure various levels of general liability, workers’ compensation, and medical coverage at most of our properties. Insurance reserves include accruals for estimated settlements for known claims, as well as accruals for estimates of claims not yet made. As of March 31, 2016 and December 31, 2015 , we had total self-insurance accruals of $25.6 million and $25.5 million , respectively, which are included in “Total current liabilities” in our unaudited Condensed Consolidated Balance Sheets. Indiana Tax Dispute: In 2008, the Indiana Department of Revenue (the “IDR”) commenced an examination of our Indiana income tax filings for the years 2005, 2006, and 2007. In 2010, we received a proposed assessment in the amount of $7.3 million , excluding interest and penalties. We filed a protest requesting abatement of all taxes, interest and penalties and had two hearings with the IDR where we provided additional facts and support. At issue was whether income and gains from certain asset sales, including the sale of the Hollywood Park Racetrack in 1999, and other transactions outside of Indiana, such as the Aztar merger termination fee in 2006, which we reported on our Indiana state tax returns for the years 2000 through 2007, resulted in business income subject to apportionment. In April 2012, we received a supplemental letter of findings from the IDR that denied our protest on most counts. In the supplemental letter of findings, the IDR did not raise any new technical arguments or advance any new theory that would alter our judgment regarding the recognition or measurement of the unrecognized tax benefit related to this audit. In June 2012, we filed a tax appeal petition with the Indiana Tax Court (the “ITC”) to set aside the final assessment. In August 2013, we filed a motion for partial summary judgment on the 1999 Hollywood Park sale asking the court to grant summary judgment in our favor based on the technical merit of Indiana tax law. In January 2014, oral arguments were heard at the ITC regarding our motion for summary judgment. In June 2015, the ITC denied our motion for summary judgment and set the case for trial. In April 2016, we reached an agreement to settle with the IDR, which did not have a material effect on our unaudited Condensed Consolidated Financial Statements. Other: We are a party to a number of other pending legal proceedings. Management does not expect that the outcome of such proceedings, either individually or in the aggregate, will have a material effect on our financial position, cash flows or results of operations. |
Consolidating Condensed Financi
Consolidating Condensed Financial Information | 3 Months Ended |
Mar. 31, 2016 | |
Condensed Financial Information of Parent Company Only Disclosure [Abstract] | |
Consolidating Condensed Financial Information | Consolidating Condensed Financial Information Our subsidiaries (excluding subsidiaries with approximately $38.3 million in cash and other assets as of March 31, 2016 , that include a majority interest in the licensee of Retama Park Racetrack and certain other subsidiaries) have fully, unconditionally, jointly, and severally guaranteed the payment of all obligations under our senior and senior subordinated notes and our Credit Facility. Separate financial statements and other disclosures regarding the subsidiary guarantors are not included herein because management has determined that such information is not material to investors. In lieu thereof, we include the following: Pinnacle Entertainment, Inc. 100% Owned Guarantor Subsidiaries(a) Non- Guarantor Subsidiaries(b) Consolidating and Eliminating Entries Pinnacle Entertainment, Inc. Consolidated (in millions) Statements of Operations For the three months ended March 31, 2016 Revenues: Gaming $ — $ 520.8 $ — $ — $ 520.8 Food and beverage — 32.0 — — 32.0 Lodging — 11.3 — — 11.3 Retail, entertainment and other — 15.9 — — 15.9 — 580.0 — — 580.0 Expenses and other costs: Gaming — 267.1 — — 267.1 Food and beverage — 29.9 — — 29.9 Lodging — 5.6 — — 5.6 Retail, entertainment and other — 4.5 — — 4.5 General and administrative 23.3 81.6 — — 104.9 Depreciation and amortization 2.0 52.1 — — 54.1 Pre-opening, development and other costs 5.3 — — — 5.3 Write-downs, reserves and recoveries, net — 2.9 — — 2.9 30.6 443.7 — — 474.3 Operating income (loss) (30.6 ) 136.3 — — 105.7 Equity in earnings of subsidiaries 102.7 — — (102.7 ) — Interest expense, net (59.8 ) — — — (59.8 ) Income (loss) from continuing operations before inter-company activity and income taxes 12.3 136.3 — (102.7 ) 45.9 Management fee and inter-company interest 33.7 (33.7 ) — — — Income tax expense (5.0 ) — — — (5.0 ) Income (loss) from continuing operations 41.0 102.6 — (102.7 ) 40.9 Income from discontinued operations, net of income taxes — 0.1 — — 0.1 Net income (loss) $ 41.0 $ 102.7 $ — $ (102.7 ) $ 41.0 Pinnacle Entertainment, Inc. 100% Owned Guarantor Subsidiaries(a) Non- Guarantor Subsidiaries(b) Consolidating and Eliminating Entries Pinnacle Entertainment, Inc. Consolidated (in millions) For the three months ended March 31, 2015 Revenues: Gaming $ — $ 514.4 $ — $ — $ 514.4 Food and beverage — 32.0 — — 32.0 Lodging — 11.5 — — 11.5 Retail, entertainment and other — 14.9 — — 14.9 — 572.8 — — 572.8 Expenses and other costs: Gaming — 264.9 — — 264.9 Food and beverage — 29.2 — — 29.2 Lodging — 5.8 — — 5.8 Retail, entertainment and other — 5.1 — — 5.1 General and administrative 22.3 79.9 — — 102.2 Depreciation and amortization 4.3 63.5 — — 67.8 Pre-opening, development and other costs 1.4 0.1 — — 1.5 Write-downs, reserves and recoveries, net 3.0 0.2 — — 3.2 31.0 448.7 — — 479.7 Operating income (loss) (31.0 ) 124.1 — — 93.1 Equity in earnings of subsidiaries 88.3 — — (88.3 ) — Interest expense, net (61.1 ) — — — (61.1 ) Loss from equity method investment — — (0.1 ) — (0.1 ) Income (loss) from continuing operations before inter-company activity and income taxes (3.8 ) 124.1 (0.1 ) (88.3 ) 31.9 Management fee and inter-company interest 35.9 (35.9 ) — — — Income tax expense (4.8 ) — — — (4.8 ) Income (loss) from continuing operations 27.3 88.2 (0.1 ) (88.3 ) 27.1 Income from discontinued operations, net of income taxes — 0.2 — — 0.2 Net income (loss) $ 27.3 $ 88.4 $ (0.1 ) $ (88.3 ) $ 27.3 Pinnacle Entertainment, Inc. 100% Owned Guarantor Subsidiaries(a) Non- Guarantor Subsidiaries(b) Consolidating and Eliminating Entries Pinnacle Entertainment, Inc. Consolidated (in millions) Balance Sheets As of March 31, 2016 Current assets, excluding discontinued operations $ 41.5 $ 133.3 $ 5.9 $ — $ 180.7 Property and equipment, net 25.4 2,792.7 5.2 — 2,823.3 Goodwill — 914.6 — — 914.6 Intangible assets, net — 476.5 — — 476.5 Other non-current assets 16.2 2.9 27.2 — 46.3 Investment in subsidiaries 4,676.6 — — (4,676.6 ) — Assets of discontinued operations held for sale — 9.8 — — 9.8 Inter-company — 782.8 — (782.8 ) — Total assets $ 4,759.7 $ 5,112.6 $ 38.3 $ (5,459.4 ) $ 4,451.2 Current liabilities $ 117.5 $ 185.7 $ — $ — $ 303.2 Long-term debt less current portion 3,514.6 0.1 — — 3,514.7 Other non-current liabilities (52.7 ) 277.2 — — 224.5 Inter-company 781.6 — 1.2 (782.8 ) — Total liabilities 4,361.0 463.0 1.2 (782.8 ) 4,042.4 Total Pinnacle stockholders’ equity 398.7 4,649.6 27.0 (4,676.6 ) 398.7 Non-controlling interest — — 10.1 — 10.1 Total stockholders’ equity 398.7 4,649.6 37.1 (4,676.6 ) 408.8 Total liabilities and stockholders’ equity $ 4,759.7 $ 5,112.6 $ 38.3 $ (5,459.4 ) $ 4,451.2 As of December 31, 2015 Current assets, excluding discontinued operations $ 33.5 $ 190.4 $ 9.8 $ (10.0 ) $ 223.7 Property and equipment, net 23.9 2,826.9 5.2 — 2,856.0 Goodwill — 914.6 — — 914.6 Intangible assets, net — 479.5 — — 479.5 Other non-current assets 17.7 3.1 26.4 — 47.2 Investment in subsidiaries 4,636.6 — — (4,636.6 ) — Assets of discontinued operations held for sale 0.3 9.6 — — 9.9 Inter-company — 703.3 — (703.3 ) — Total assets $ 4,712.0 $ 5,127.4 $ 41.4 $ (5,349.9 ) $ 4,530.9 Current liabilities $ 96.5 $ 239.8 $ — $ (10.0 ) $ 326.3 Long-term debt less current portion 3,616.6 0.1 — — 3,616.7 Other non-current liabilities (56.6 ) 281.0 — — 224.4 Inter-company 702.1 — 1.2 (703.3 ) — Total liabilities 4,358.6 520.9 1.2 (713.3 ) 4,167.4 Total Pinnacle stockholders’ equity 353.4 4,606.5 30.1 (4,636.6 ) 353.4 Non-controlling interest — — 10.1 — 10.1 Total stockholders’ equity 353.4 4,606.5 40.2 (4,636.6 ) 363.5 Total liabilities and stockholders’ equity $ 4,712.0 $ 5,127.4 $ 41.4 $ (5,349.9 ) $ 4,530.9 Pinnacle Entertainment, Inc. 100% Owned Guarantor Non- Guarantor Subsidiaries(b) Consolidating and Eliminating Entries Pinnacle Entertainment, Inc. Consolidated (in millions) Statements of Cash Flows For the three months ended March 31, 2016 Cash provided by (used in) operating activities $ (34.1 ) $ 109.8 $ 9.8 $ — $ 85.5 Capital expenditures (4.4 ) (17.5 ) — — (21.9 ) Net proceeds from disposition of asset held for sale 0.3 — — — 0.3 Loans receivable — — (0.7 ) — (0.7 ) Net transfers to (from) affiliates 145.1 — — (145.1 ) — Cash provided by (used in) investing activities 141.0 (17.5 ) (0.7 ) (145.1 ) (22.3 ) Proceeds from credit facility 64.0 — — — 64.0 Repayments under credit facility (169.3 ) — — — (169.3 ) Net transfers to (from) affiliates — (142.0 ) (3.1 ) 145.1 — Other (0.6 ) — — — (0.6 ) Cash provided by (used in) financing activities (105.9 ) (142.0 ) (3.1 ) 145.1 (105.9 ) Change in cash and cash equivalents 1.0 (49.7 ) 6.0 — (42.7 ) Cash and cash equivalents, beginning of period 1.5 162.5 — — 164.0 Cash and cash equivalents, end of period $ 2.5 $ 112.8 $ 6.0 $ — $ 121.3 For the three months ended March 31, 2015 Cash provided by (used in) operating activities $ 115.0 $ (25.4 ) $ 23.5 $ — $ 113.1 Capital expenditures (2.1 ) (19.0 ) — — (21.1 ) Other — 0.3 (0.8 ) — (0.5 ) Cash used in investing activities (2.1 ) (18.7 ) (0.8 ) — (21.6 ) Proceeds from credit facility 35.0 — — — 35.0 Repayments under credit facility (137.8 ) — — — (137.8 ) Other 5.9 — — — 5.9 Cash used in financing activities (96.9 ) — — — (96.9 ) Change in cash and cash equivalents 16.0 (44.1 ) 22.7 — (5.4 ) Cash and cash equivalents, beginning of period 6.4 158.3 — — 164.7 Cash and cash equivalents, end of period $ 22.4 $ 114.2 $ 22.7 $ — $ 159.3 _______________________ (a) The following material subsidiaries are identified as guarantors of our senior and senior subordinated notes: Belterra Resort Indiana, LLC; Boomtown, LLC; Casino Magic, LLC; Louisiana-I Gaming; PNK (Baton Rouge) Partnership; PNK (BOSSIER CITY), LLC; PNK Development 7, LLC; PNK Development 8, LLC; PNK Development 9, LLC; PNK (LAKE CHARLES), L.L.C.; PNK (Ohio), LLC; PNK (Ohio) II, LLC; PNK (Ohio) III, LLC; PNK (River City), LLC; PNK (SAM), LLC; PNK (SAZ), LLC; Ameristar Casino Black Hawk, LLC; Ameristar Casino Council Bluffs, LLC; Ameristar Casino St. Charles, LLC; Ameristar Casino Kansas City, LLC; PNK Vicksburg, LLC; Cactus Pete’s, LLC; Ameristar East Chicago Holdings, LLC; and Ameristar Casino East Chicago, LLC. In addition, certain other immaterial subsidiaries are also guarantors of our senior and senior subordinated notes. (b) Guarantor subsidiaries of our senior and senior subordinated notes exclude subsidiaries with approximately $38.3 million in cash and other assets as of March 31, 2016 , that include a subsidiary that owns a majority interest in the licensee of Retama Park Racetrack and certain other subsidiaries. |
Segment Information
Segment Information | 3 Months Ended |
Mar. 31, 2016 | |
Segment Reporting [Abstract] | |
Segment Information | Segment Information We view each of our operating properties as an operating segment with the exception of our two properties in Jackpot, Nevada, which we view as one operating segment. Operating segments are aggregated based on their similar economic characteristics, types of customers, types of services provided, the regulatory environments in which they operate, and their management and reporting structure. We have aggregated our operating segments into three reportable segments based on the similar characteristics of the operating segments within the regions in which they operate: Midwest, South, and West. Corporate expenses and other is included in the following segment disclosures to reconcile to consolidated results. We use Consolidated Adjusted EBITDA (as defined below) and Adjusted EBITDA (as defined below) for each segment to compare operating results among our segments and allocate resources. The following table highlights our Adjusted EBITDA for each segment and reconciles Consolidated Adjusted EBITDA to Income from continuing operations for the three months ended March 31, 2016 , and 2015 . For the three months ended March 31, 2016 2015 (in millions) Revenues: Midwest segment (a) $ 328.6 $ 313.9 South segment (a) 193.7 203.7 West segment (a) 56.5 53.7 578.8 571.3 Corporate and other (c) 1.2 1.5 Total revenues $ 580.0 $ 572.8 Adjusted EBITDA (b): Midwest segment (a) $ 107.5 $ 100.8 South segment (a) 64.6 67.5 West segment (a) 20.9 20.7 193.0 189.0 Corporate expenses and other (c) (20.6 ) (19.3 ) Consolidated Adjusted EBITDA (b) 172.4 169.7 Other costs: Depreciation and amortization (54.1 ) (67.8 ) Pre-opening, development and other costs (5.3 ) (1.6 ) Non-cash share-based compensation expense (4.4 ) (4.1 ) Write-downs, reserves and recoveries, net (2.9 ) (3.1 ) Interest expense, net (59.8 ) (61.1 ) Loss from equity method investment — (0.1 ) Income tax expense (5.0 ) (4.8 ) Income from continuing operations $ 40.9 $ 27.1 For the three months ended March 31, 2016 2015 (in millions) Capital expenditures: Midwest segment (a) $ 9.2 $ 10.5 South segment (a) 7.1 7.2 West segment (a) 2.6 1.3 Corporate and other, including development projects 3.0 2.1 $ 21.9 $ 21.1 (a) See Note 1, “Organization and Summary of Significant Accounting Policies,” for listing of properties included in each segment. (b) We define Consolidated Adjusted EBITDA as earnings before interest income and expense, income taxes, depreciation, amortization, pre-opening, development and other costs, non-cash share-based compensation, asset impairment costs, write-downs, reserves, recoveries, corporate-level litigation settlement costs, gain (loss) on sale of certain assets, loss on early extinguishment of debt, gain (loss) on sale of equity security investments, income (loss) from equity method investments, non-controlling interest and discontinued operations. We define Adjusted EBITDA for each reportable segment as earnings before interest income and expense, income taxes, depreciation, amortization, pre-opening, development and other costs, non-cash share-based compensation, asset impairment costs, write-downs, reserves, recoveries, inter-company management fees, gain (loss) on sale of certain assets, gain (loss) on early extinguishment of debt, gain (loss) on sale of discontinued operations, and discontinued operations. We define Adjusted EBITDA margin as Adjusted EBITDA for the segment divided by segment revenues. We use Consolidated Adjusted EBITDA and Adjusted EBITDA for each segment to compare operating results among our properties and between accounting periods. Consolidated Adjusted EBITDA and Adjusted EBITDA have economic substance because they are used by management as measures to analyze the performance of our business and are especially relevant in evaluating large, long-lived casino-hotel projects because they provide a perspective on the current effects of operating decisions separated from the substantial non-operational depreciation charges and financing costs of such projects. We eliminate the results from discontinued operations at the time they are deemed discontinued. We also review pre-opening, development and other costs separately, as such expenses are also included in total project costs when assessing budgets and project returns, and because such costs relate to anticipated future revenues and income. We believe that Consolidated Adjusted EBITDA and Adjusted EBITDA are useful measures for investors because they are indicators of the performance of ongoing business operations. These calculations are commonly used as a basis for investors, analysts and credit rating agencies to evaluate and compare operating performance and value of companies within our industry. In addition, our credit agreement and bond indentures require compliance with financial measures similar to Consolidated Adjusted EBITDA. Consolidated Adjusted EBITDA should not be considered as an alternative to operating income as an indicator of performance, or as an alternative to any other measure provided in accordance with GAAP. Our calculations of Adjusted EBITDA and Consolidated Adjusted EBITDA may be different from the calculation methods used by other companies and, therefore, comparability may be limited. (c) Corporate and other includes revenues from Retama Park Racetrack (which we manage) and the Heartland Poker Tour. Corporate expenses represent payroll, professional fees, travel expenses and other general and administrative expenses not directly related to our casino and hotel operations. Corporate expenses that are directly attributable to a property are allocated to each applicable property. All other costs incurred relating to the management and consulting services provided by corporate headquarters to the properties are allocated to those properties based on their respective share of the monthly consolidated net revenues in the form of a management fee. The corporate management fee is excluded in the calculation of segment Adjusted EBITDA and is completely eliminated in any consolidated financial results. |
Organization and Summary of S18
Organization and Summary of Significant Accounting Policies (Policies) | 3 Months Ended |
Mar. 31, 2016 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation | Basis of Presentation. The accompanying unaudited Condensed Consolidated Financial Statements have been prepared in accordance with the instructions of the Securities and Exchange Commission (the “SEC”) to the Quarterly Report on Form 10-Q and, therefore, do not include all information and notes necessary for complete financial statements in conformity with generally accepted accounting principles in the United States (“GAAP”). The results for the periods indicated are unaudited, but reflect all adjustments, which are of a normal recurring nature, that management considers necessary for a fair presentation of operating results. The results of operations for interim periods are not indicative of a full year of operations. These unaudited Condensed Consolidated Financial Statements and notes thereto should be read in conjunction with the Consolidated Financial Statements and notes thereto included in our Information Statement included as Exhibit 99.1 to our Registration Statement on Form 10 filed with the SEC in final form on April 11, 2016. |
Principles of Consolidation | Principles of Consolidation. The unaudited Condensed Consolidated Financial Statements include the accounts of Pinnacle Entertainment, Inc. and its subsidiaries. Investments in the common stock of unconsolidated affiliates in which we have the ability to exercise significant influence are accounted for under the equity method. All intercompany accounts and transactions have been eliminated in consolidation. |
Use of Estimates | Use of Estimates. The preparation of unaudited Condensed Consolidated Financial Statements in conformity with GAAP requires management to make estimates and assumptions that affect (i) the reported amounts of assets and liabilities, (ii) the disclosure of contingent assets and liabilities at the date of the consolidated financial statements, and (iii) the reported amounts of revenues and expenses during the reporting period. Estimates used by us include, among other things, the estimated useful lives for depreciable and amortizable assets, the estimated allowance for doubtful accounts receivable, estimated income tax provisions, the evaluation of the future realization of deferred tax assets, determining the adequacy of reserves for self-insured liabilities and our customer loyalty programs, estimated cash flows in assessing the recoverability of long-lived assets, asset impairments, goodwill and intangible assets, contingencies and litigation, and estimates of the forfeiture rate and expected life of share-based awards and stock price volatility when computing share-based compensation expense. Actual results may differ from those estimates. |
Fair Value | Fair Value. Fair value measurements affect our accounting and impairment assessments of our long-lived assets, investments in unconsolidated affiliates, assets acquired in an acquisition, goodwill, and other intangible assets. Fair value measurements also affect our accounting for certain financial assets and liabilities. Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date and is measured according to a hierarchy that includes: “Level 1” inputs, such as quoted prices in an active market for identical assets or liabilities; “Level 2” inputs, which are observable inputs for similar assets; or “Level 3” inputs, which are unobservable inputs. |
Land, Buildings, Vessels and Equipment | Land, Buildings, Vessels and Equipment. Land, buildings, vessels and equipment are stated at cost. Land includes land not currently being used in our operations, which totaled $35.8 million as of March 31, 2016 . We capitalize the costs of improvements that extend the life of the asset. We expense repair and maintenance costs as incurred. Gains or losses on the disposition of land, buildings, vessels and equipment are included in the determination of income. We review the carrying amounts of our land, buildings, vessels and equipment used in our operations whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable from estimated future undiscounted cash flows expected to result from its use and eventual disposition. If the undiscounted cash flows exceed the carrying amount, no impairment is indicated. If the undiscounted cash flows do not exceed the carrying amount, then an impairment charge is recorded based on the fair value of the asset. Development costs directly associated with the acquisition, development, and construction of a project are capitalized as a cost of the project during the periods in which activities necessary to get the property ready for its intended use are in progress. The costs incurred for development projects are carried at cost. Interest costs associated with development projects are capitalized as part of the cost of the constructed asset. When no debt is incurred specifically for a project, interest is capitalized on amounts expended for the project using our weighted-average cost of borrowing. Capitalization of interest ceases when the project, or discernible portion of the project, is substantially complete. If substantially all of the construction activities of a project are suspended, capitalization of interest will cease until such activities are resumed. |
Goodwill and Other Intangible Assets | Goodwill and Other Intangible Assets. Goodwill consists of the excess of the acquisition cost over the fair value of the net assets acquired in business combinations. Indefinite-lived intangible assets include gaming licenses and trade names for which it is reasonably assured that we will continue to renew indefinitely. Goodwill and other indefinite-lived intangible assets are subject to an annual assessment for impairment during the fourth quarter (October 1st test date), or more frequently if there are indications of possible impairment. Amortizing intangible assets include player relationships and favorable leasehold interests. We review amortizing intangible assets for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. As a result of the Spin-Off and Merger, we will test our reporting unit goodwill and other indefinite-lived intangible assets for impairment. This testing may result in a significant non-cash impairment charge to our goodwill or our other indefinite-lived intangible assets, which would be recognized during the second quarter of 2016. |
Customer Loyalty Programs | Customer Loyalty Programs. We offer incentives to our customers through our my choice customer loyalty program. Under the my choice customer loyalty program, customers earn points based on their level of play that may be redeemed for various benefits, such as cash back, dining, or hotel stays, among others. The reward credit balance under the plan will be forfeited if the customer does not earn or use any reward credits over the prior six-month period. In addition, based on their level of play, customers can earn additional benefits without redeeming points, such as a car lease, among other items. We accrue a liability for the estimated cost of providing these benefits as the benefits are earned. Estimates and assumptions are made regarding cost of providing the benefits, breakage rates, and the combination of goods and services customers will choose. We use historical data to assist in the determination of estimated accruals. Changes in estimates or customer redemption habits could produce different results. |
Revenue Recognition | Revenue Recognition. Gaming revenues consist of the net win from gaming activities, which is the difference between amounts wagered and amounts paid to winning patrons. Cash discounts and other cash incentives to customers related to gaming play are recorded as a reduction to gaming revenue. Food and beverage, lodging, retail, entertainment, and other operating revenues are recognized as products are delivered or services are performed. Advance deposits on lodging are recorded as accrued liabilities until services are provided to the customer. The retail value of food and beverage, lodging and other services furnished to guests on a complimentary basis is included in revenues and then deducted as promotional allowances in calculating total revenues. The estimated cost of providing such promotional allowances is primarily included in gaming expenses. |
Gaming Taxes | Gaming Taxes. We are subject to taxes based on gross gaming revenues in the jurisdictions in which we operate, subject to applicable jurisdictional adjustments. These gaming taxes are an assessment on our gaming revenues and are recorded as a gaming expense in our unaudited Condensed Consolidated Statements of Operations. |
Pre-opening, Development and Other Costs | Pre-opening, Development and Other Costs. Pre-opening, development and other costs consist of payroll costs to hire, employ and train the workforce prior to opening an operating facility; marketing campaigns prior to and in connection with the opening; legal and professional fees related to the project but not otherwise attributable to depreciable assets; lease payments; real estate taxes; acquisition costs; restructuring costs; and other costs prior to the opening of an operating facility. Pre-opening, development and other costs are expensed as incurred. |
Earnings Per Share | Earnings Per Share. The computation of basic and diluted earnings per share is based on net income attributable to Pinnacle Entertainment, Inc. divided by the basic weighted average number of common shares and diluted weighted average number of common shares, respectively. Diluted earnings per share reflect the addition of potentially dilutive securities, which include in-the-money share-based awards. We calculate the effect of dilutive securities using the treasury stock method. |
Reclassifications | Reclassifications. The unaudited Condensed Consolidated Financial Statements reflect certain reclassifications to prior year amounts to conform to classification in the current period. These reclassifications had no effect on the previously reported net income. |
Recently Issued Accounting Pronouncements | Recently Issued Accounting Pronouncements In May 2014, as part of its ongoing efforts to assist in the convergence of GAAP and International Financial Reporting Standards, the Financial Accounting Standards Board (the “FASB”) issued Accounting Standards Update (“ASU”) 2014-09, Revenue from Contracts with Customers , which is a new standard related to revenue recognition. Under the new standard, recognition of revenue occurs when a customer obtains control of promised services or goods in an amount that reflects the consideration to which the entity expects to receive in exchange for those goods or services. In addition, the standard requires disclosure of the nature, amount, timing, and uncertainty of revenue and cash flows arising from customer contracts. The standard must be adopted using either a full retrospective approach for all periods presented in the period of adoption or a modified retrospective approach. In July 2015, the FASB issued ASU 2015-14, Revenue from Contracts with Customers - Deferral of the Effective Date , which defers the implementation of this new standard to be effective for fiscal years beginning after December 15, 2017. In March 2016, the FASB issued ASU 2016-08, Principal versus Agent Considerations , which clarifies the implementation guidance on principal versus agent considerations in the new revenue recognition standard pursuant to ASU 2014-09. In April 2016, the FASB issued ASU 2016-10, Identifying Performance Obligations and Licensing , and in May 2016, the FASB issued ASU 2016-12, Narrow-Scope Improvements and Practical Expedients, which amend certain aspects of the new revenue recognition standard pursuant to ASU 2014-09. We are currently evaluating which transition approach we will utilize and the impact of adopting this accounting standard on our unaudited Condensed Consolidated Financial Statements. In June 2014, the FASB issued ASU 2014-12, Accounting for Share-Based Payments when the Terms of an Award Provide that a Performance Target Could be Achieved after the Requisite Service Period . This ASU requires that a performance target that affects vesting, and that could be achieved after the requisite service period, be treated as a performance condition. As such, the performance target should not be reflected in estimating the grant date fair value of the award. This update further clarifies that compensation cost should be recognized in the period in which it becomes probable that the performance target will be achieved and should represent the compensation cost attributable to the period or periods for which the requisite service has already been rendered. We adopted this guidance during the first quarter of 2016 using a prospective transition approach and it did not have a material impact on our unaudited Condensed Consolidated Financial Statements. In February 2015, the FASB issued ASU No. 2015-02, Amendments to the Consolidation Analysis , which amends 1) the assessment of whether a limited partnership is a variable interest entity; 2) the effect that fees paid to a decision maker have on the consolidation analysis; 3) how variable interests held by a reporting entity’s related parties or de facto agents affect its consolidation conclusion; and 4) for entities other than limited partnerships, clarifies how to determine whether the equity holders as a group have power over an entity. We adopted this guidance during the first quarter of 2016 and it did not have a material impact on our unaudited Condensed Consolidated Financial Statements. In September 2015, the FASB issued ASU No. 2015-16, Simplifying the Accounting for Measurement-Period Adjustments , which requires that an acquirer recognize adjustments to provisional amounts that are identified during the measurement period in the reporting period in which the adjustment amounts are determined. We adopted this guidance during the first quarter of 2016 and it did not have a material impact on our unaudited Condensed Consolidated Financial Statements. In January 2016, the FASB issued ASU No. 2016-01, Recognition and Measurement of Financial Assets and Financial Liabilities , which addresses certain aspects of recognition, measurement, presentation, and disclosure of financial instruments. The effective date for this update is for the annual and interim periods beginning after December 15, 2017, with early adoption not permitted. We are currently evaluating the impact of adopting this accounting standard on our unaudited Condensed Consolidated Financial Statements. In February 2016, the FASB issued ASU No. 2016-02, Recognition and Measurement of Leases . Under the new guidance, for all leases (with the exception of short-term leases), at the commencement date, lessees will be required to recognize a lease liability, which is a lessee’s obligation to make lease payments arising from a lease, measured on a discounted basis, and a right-of-use asset, which is an asset that represents the lessee’s right to use, or control the use of, a specified asset for the lease term. Under the new guidance, lessor accounting is largely unchanged. Further, the new lease guidance simplifies the accounting for sale and leaseback transactions primarily because lessees must recognize lease assets and liabilities, which no longer provides a source for off balance sheet financing. The effective date for this update is for the annual and interim periods beginning after December 15, 2018 with early adoption permitted. Lessees and lessors must apply a modified retrospective transition approach for leases existing at, or entered into after, the beginning of the earliest comparative period presented in the financial statements. We are currently evaluating the impact of adopting this accounting standard on our unaudited Condensed Consolidated Financial Statements. In March 2016, the FASB issued ASU No. 2016-06, Contingent Put and Call Options in Debt Instruments , which clarifies the requirements for assessing whether contingent call or put options that can accelerate the payment of principal on debt instruments are clearly and closely related to their debt hosts. The effective date for this update is for the annual and interim periods beginning after December 15, 2016, with early adoption permitted. We are currently evaluating the impact of adopting this accounting standard on our unaudited Condensed Consolidated Financial Statements. In March 2016, the FASB issued ASU No. 2016-07, Investments - Equity Method and Joint Ventures (Topic 323): Simplifying the Transition to the Equity Method of Accounting , which, among other things, eliminates the requirement that when an investment qualifies for use of the equity method as a result of an increase in the level of ownership interest or degree of influence, an investor must adjust the investment, results of operations, and retained earnings retroactively on a step-by-step basis as if the equity method had been in effect during all previous periods that the investment had been held. The effective date for this update is for the annual and interim periods beginning after December 15, 2016, with early adoption permitted. We are currently evaluating the impact of adopting this accounting standard on our unaudited Condensed Consolidated Financial Statements. In March 2016, the FASB issued ASU No. 2016-09, Improvements to Employee Share-Based Payment Accounting , which simplifies several aspects of the accounting for employee share-based payment transactions, including the accounting for income taxes, forfeitures, and statutory tax withholding requirements, as well as classification in the statement of cash flows. The effective date for this update is for the annual and interim periods beginning after December 15, 2016, with early adoption permitted. We are currently evaluating the impact of adopting this accounting standard on our unaudited Condensed Consolidated Financial Statements. A variety of proposed or otherwise potential accounting standards are currently under review and study by standard-setting organizations and certain regulatory agencies. Given the tentative and preliminary nature of such proposed standards, we have not yet determined the effect, if any, that the implementation of any such proposed or revised standards would have on our unaudited Condensed Consolidated Financial Statements. |
Organization and Summary of S19
Organization and Summary of Significant Accounting Policies (Tables) | 3 Months Ended |
Mar. 31, 2016 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Schedule of Properties within Reportable Segments | For financial reporting purposes, we aggregate our operating segments into the following reportable segments: Midwest segment, which includes: Location Ameristar Council Bluffs Council Bluffs, Iowa Ameristar East Chicago East Chicago, Indiana Ameristar Kansas City Kansas City, Missouri Ameristar St. Charles St. Charles, Missouri River City St. Louis, Missouri Belterra Florence, Indiana Belterra Park Cincinnati, Ohio South segment, which includes: Location Ameristar Vicksburg Vicksburg, Mississippi Boomtown Bossier City Bossier City, Louisiana Boomtown New Orleans New Orleans, Louisiana L’Auberge Baton Rouge Baton Rouge, Louisiana L’Auberge Lake Charles Lake Charles, Louisiana West segment, which includes: Location Ameristar Black Hawk Black Hawk, Colorado Cactus Petes and Horseshu Jackpot, Nevada |
Fair Value of Liabilities Measured on Recurring Basis | The following table presents a summary of fair value measurements by level for certain liabilities measured at fair value on a recurring basis in the unaudited Condensed Consolidated Balance Sheets: Fair Value Measurements Using: Total Fair Value Level 1 Level 2 Level 3 (in millions) As of March 31, 2016 Liabilities: Deferred compensation $ 0.4 $ 0.4 $ — $ — As of December 31, 2015 Liabilities: Deferred compensation $ 0.4 $ 0.4 $ — $ — |
Fair Value Measurements Not Measured on a Recurring Basis | The following table presents a summary of fair value measurements by level for certain financial instruments not measured at fair value on a recurring basis in the unaudited Condensed Consolidated Balance Sheets for which it is practicable to estimate fair value: Fair Value Measurements Using: Total Carrying Amount Total Fair Value Level 1 Level 2 Level 3 (in millions) As of March 31, 2016 Assets: Held-to-maturity securities $ 14.4 $ 15.5 $ — $ 12.4 $ 3.1 Promissory notes $ 14.9 $ 19.4 $ — $ 19.4 $ — Liabilities: Long-term debt $ 3,525.7 $ 3,673.0 $ — $ 3,673.0 $ — As of December 31, 2015 Assets: Held-to-maturity securities $ 14.4 $ 15.2 $ — $ 12.1 $ 3.1 Promissory notes $ 14.1 $ 19.2 $ — $ 19.2 $ — Liabilities: Long-term debt $ 3,627.7 $ 3,740.6 $ — $ 3,740.6 $ — |
Summary of Land, Buildings, Vessels and Equipment | The following table presents a summary of our land, buildings, vessels and equipment: March 31, December 31, (in millions) Land, buildings, vessels and equipment: Land and land improvements $ 424.6 $ 422.8 Buildings, vessels and improvements 2,675.3 2,674.6 Furniture, fixtures and equipment 767.5 763.8 Construction in progress 37.2 33.2 Land, buildings, vessels and equipment, gross 3,904.6 3,894.4 Less: accumulated depreciation (1,081.3 ) (1,038.4 ) Land, buildings, vessels and equipment, net $ 2,823.3 $ 2,856.0 |
Schedule of Complimentary Revenue | Complimentary revenues that have been excluded from the accompanying unaudited Condensed Consolidated Statements of Operations were as follows: For the three months ended March 31, 2016 2015 (in millions) Food and beverage $ 33.8 $ 35.2 Lodging 15.8 15.2 Other 3.7 4.4 Total promotional allowances $ 53.3 $ 54.8 The costs to provide such complimentary benefits were as follows: For the three months ended March 31, 2016 2015 (in millions) Promotional allowance costs included in gaming expense $ 38.2 $ 39.3 |
Schedule of Gaming Taxes | These taxes were as follows: For the three months ended March 31, 2016 2015 (in millions) Gaming taxes $ 145.8 $ 144.7 |
Schedule of Pre-opening, Development and Other Costs | Pre-opening, development and other costs consist of the following: For the three months ended March 31, 2016 2015 (in millions) Restructuring costs (1) $ 3.5 $ 0.7 Meadows acquisition costs (2) 1.7 — Other 0.1 0.9 Total pre-opening, development and other costs $ 5.3 $ 1.6 (1) Amounts comprised of costs associated with the separation of Former Pinnacle’s real estate assets from its operating assets. See Note 6, “Investment, Restructuring and Acquisition Activities.” (2) Amount comprised of costs associated with the Company’s acquisition of The Meadows Racetrack and Casino (“Meadows”) business. See Note 6, “Investment, Restructuring and Acquisition Activities.” |
Long-Term Debt (Tables)
Long-Term Debt (Tables) | 3 Months Ended |
Mar. 31, 2016 | |
Debt Disclosure [Abstract] | |
Schedule of Long-term Debt Instruments | Long-term debt consisted of the following: March 31, 2016 Outstanding Principal Unamortized (Discount) Premium Unamortized Debt Issuance Costs Long-Term Debt, Net (in millions) Senior Secured Credit Facility: Revolving Credit Facility due 2018 $ 750.1 $ — $ — $ 750.1 B-2 Term Loans due 2020 197.0 (7.4 ) (1.7 ) 187.9 6.375% Senior Notes due 2021 850.0 — (12.5 ) 837.5 7.50% Senior Notes due 2021 1,040.0 44.8 — 1,084.8 7.75% Senior Subordinated Notes due 2022 325.0 — (4.6 ) 320.4 8.75% Senior Subordinated Notes due 2020 350.0 — (5.1 ) 344.9 Other 0.1 — — 0.1 Total debt including current maturities 3,512.2 37.4 (23.9 ) 3,525.7 Less: current maturities (11.0 ) — — (11.0 ) Total long-term debt $ 3,501.2 $ 37.4 $ (23.9 ) $ 3,514.7 December 31, 2015 Outstanding Principal Unamortized (Discount) Premium Unamortized Debt Issuance Costs Long-Term Debt, Net (in millions) Senior Secured Credit Facility: Revolving Credit Facility due 2018 $ 750.1 $ — $ — $ 750.1 B-2 Term Loans due 2020 302.2 (10.9 ) (2.4 ) 288.9 6.375% Senior Notes due 2021 850.0 — (13.0 ) 837.0 7.50% Senior Notes due 2021 1,040.0 46.7 — 1,086.7 7.75% Senior Subordinated Notes due 2022 325.0 — (4.7 ) 320.3 8.75% Senior Subordinated Notes due 2020 350.0 — (5.4 ) 344.6 Other 0.1 — — 0.1 Total debt including current maturities 3,617.4 35.8 (25.5 ) 3,627.7 Less: current maturities (11.0 ) — — (11.0 ) Total long-term debt $ 3,606.4 $ 35.8 $ (25.5 ) $ 3,616.7 |
Schedule of Interest Expense, Net | Interest expense, net, was as follows: For the three months ended March 31, 2016 2015 (in millions) Interest expense $ 59.9 $ 61.1 Interest income (0.1 ) — Interest expense, net $ 59.8 $ 61.1 |
Employee Benefit Plans (Tables)
Employee Benefit Plans (Tables) | 3 Months Ended |
Mar. 31, 2016 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Schedule of Share-Based Compensation Expense | We recorded share-based compensation expense as follows: For the three months ended March 31, 2016 2015 (in millions) Share-based compensation expense $ 4.4 $ 4.1 |
Schedule of Stock Option Activity | The following table summarizes information related to our common stock options: Number of Stock Options Weighted Average Exercise Price Options outstanding as of January 1, 2016 5,375,476 $ 16.04 Granted — $ — Exercised (14,405 ) $ 14.90 Canceled or forfeited (2,675 ) $ 23.23 Options outstanding as of March 31, 2016 5,358,396 $ 16.04 Options exercisable as of March 31, 2016 3,766,337 $ 13.13 Expected to vest as of March 31, 2016 1,301,667 $ 23.09 |
Schedule of Weighted Average Grant Date Fair Value | The following information is provided for our stock options: For the three months ended March 31, 2016 2015 Weighted-average grant date fair value $ — $ 9.44 |
Schedule of Restricted Stock Units Activity | The following table summarizes information related to our restricted stock units: Number of Units Weighted Average Grant Date Fair Value Non-vested as of January 1, 2016 1,311,423 $ 25.16 Granted 4,105 $ 31.68 Vested (44,579 ) $ 26.50 Canceled or forfeited (4,443 ) $ 28.74 Non-vested as of March 31, 2016 1,266,506 $ 25.12 |
Schedule of Performance Stock Units Activity | The following table summarizes information related to our performance stock units: Number of Units Weighted Average Grant Date Fair Value Non-vested as of January 1, 2016 408,228 $ 23.23 Granted — $ — Canceled or forfeited — $ — Non-vested as of March 31, 2016 408,228 $ 23.23 |
Write-downs, Reserves and Rec22
Write-downs, Reserves and Recoveries, Net (Tables) | 3 Months Ended |
Mar. 31, 2016 | |
Write Downs Reserves And Recoveries Net Abstract | |
Schedule of Write Downs, Reserves and Recoveries, Net | Write-downs, reserves and recoveries, net consist of the following: For the three months ended March 31, 2016 2015 (in millions) Loss on disposals of long-lived assets, net $ 2.7 $ 0.4 Impairment of long-lived assets 0.2 2.7 Write-downs, reserves and recoveries, net $ 2.9 $ 3.1 |
Discontinued Operations and A23
Discontinued Operations and Assets Held for Sale (Tables) | 3 Months Ended |
Mar. 31, 2016 | |
Discontinued Operations and Disposal Groups [Abstract] | |
Schedule of Total Assets for Entities and Operations Classified as Held for Sale | Total assets for entities and operations classified as held for sale are summarized as follows: March 31, December 31, (in millions) Assets: Land, buildings, vessels and equipment, net $ — $ 0.3 Other assets, net 9.8 9.6 Total assets $ 9.8 $ 9.9 |
Consolidating Condensed Finan24
Consolidating Condensed Financial Information (Tables) | 3 Months Ended |
Mar. 31, 2016 | |
Condensed Financial Information of Parent Company Only Disclosure [Abstract] | |
Schedule of Condensed Consolidating Financial Statements | In lieu thereof, we include the following: Pinnacle Entertainment, Inc. 100% Owned Guarantor Subsidiaries(a) Non- Guarantor Subsidiaries(b) Consolidating and Eliminating Entries Pinnacle Entertainment, Inc. Consolidated (in millions) Statements of Operations For the three months ended March 31, 2016 Revenues: Gaming $ — $ 520.8 $ — $ — $ 520.8 Food and beverage — 32.0 — — 32.0 Lodging — 11.3 — — 11.3 Retail, entertainment and other — 15.9 — — 15.9 — 580.0 — — 580.0 Expenses and other costs: Gaming — 267.1 — — 267.1 Food and beverage — 29.9 — — 29.9 Lodging — 5.6 — — 5.6 Retail, entertainment and other — 4.5 — — 4.5 General and administrative 23.3 81.6 — — 104.9 Depreciation and amortization 2.0 52.1 — — 54.1 Pre-opening, development and other costs 5.3 — — — 5.3 Write-downs, reserves and recoveries, net — 2.9 — — 2.9 30.6 443.7 — — 474.3 Operating income (loss) (30.6 ) 136.3 — — 105.7 Equity in earnings of subsidiaries 102.7 — — (102.7 ) — Interest expense, net (59.8 ) — — — (59.8 ) Income (loss) from continuing operations before inter-company activity and income taxes 12.3 136.3 — (102.7 ) 45.9 Management fee and inter-company interest 33.7 (33.7 ) — — — Income tax expense (5.0 ) — — — (5.0 ) Income (loss) from continuing operations 41.0 102.6 — (102.7 ) 40.9 Income from discontinued operations, net of income taxes — 0.1 — — 0.1 Net income (loss) $ 41.0 $ 102.7 $ — $ (102.7 ) $ 41.0 Pinnacle Entertainment, Inc. 100% Owned Guarantor Subsidiaries(a) Non- Guarantor Subsidiaries(b) Consolidating and Eliminating Entries Pinnacle Entertainment, Inc. Consolidated (in millions) For the three months ended March 31, 2015 Revenues: Gaming $ — $ 514.4 $ — $ — $ 514.4 Food and beverage — 32.0 — — 32.0 Lodging — 11.5 — — 11.5 Retail, entertainment and other — 14.9 — — 14.9 — 572.8 — — 572.8 Expenses and other costs: Gaming — 264.9 — — 264.9 Food and beverage — 29.2 — — 29.2 Lodging — 5.8 — — 5.8 Retail, entertainment and other — 5.1 — — 5.1 General and administrative 22.3 79.9 — — 102.2 Depreciation and amortization 4.3 63.5 — — 67.8 Pre-opening, development and other costs 1.4 0.1 — — 1.5 Write-downs, reserves and recoveries, net 3.0 0.2 — — 3.2 31.0 448.7 — — 479.7 Operating income (loss) (31.0 ) 124.1 — — 93.1 Equity in earnings of subsidiaries 88.3 — — (88.3 ) — Interest expense, net (61.1 ) — — — (61.1 ) Loss from equity method investment — — (0.1 ) — (0.1 ) Income (loss) from continuing operations before inter-company activity and income taxes (3.8 ) 124.1 (0.1 ) (88.3 ) 31.9 Management fee and inter-company interest 35.9 (35.9 ) — — — Income tax expense (4.8 ) — — — (4.8 ) Income (loss) from continuing operations 27.3 88.2 (0.1 ) (88.3 ) 27.1 Income from discontinued operations, net of income taxes — 0.2 — — 0.2 Net income (loss) $ 27.3 $ 88.4 $ (0.1 ) $ (88.3 ) $ 27.3 Pinnacle Entertainment, Inc. 100% Owned Guarantor Subsidiaries(a) Non- Guarantor Subsidiaries(b) Consolidating and Eliminating Entries Pinnacle Entertainment, Inc. Consolidated (in millions) Balance Sheets As of March 31, 2016 Current assets, excluding discontinued operations $ 41.5 $ 133.3 $ 5.9 $ — $ 180.7 Property and equipment, net 25.4 2,792.7 5.2 — 2,823.3 Goodwill — 914.6 — — 914.6 Intangible assets, net — 476.5 — — 476.5 Other non-current assets 16.2 2.9 27.2 — 46.3 Investment in subsidiaries 4,676.6 — — (4,676.6 ) — Assets of discontinued operations held for sale — 9.8 — — 9.8 Inter-company — 782.8 — (782.8 ) — Total assets $ 4,759.7 $ 5,112.6 $ 38.3 $ (5,459.4 ) $ 4,451.2 Current liabilities $ 117.5 $ 185.7 $ — $ — $ 303.2 Long-term debt less current portion 3,514.6 0.1 — — 3,514.7 Other non-current liabilities (52.7 ) 277.2 — — 224.5 Inter-company 781.6 — 1.2 (782.8 ) — Total liabilities 4,361.0 463.0 1.2 (782.8 ) 4,042.4 Total Pinnacle stockholders’ equity 398.7 4,649.6 27.0 (4,676.6 ) 398.7 Non-controlling interest — — 10.1 — 10.1 Total stockholders’ equity 398.7 4,649.6 37.1 (4,676.6 ) 408.8 Total liabilities and stockholders’ equity $ 4,759.7 $ 5,112.6 $ 38.3 $ (5,459.4 ) $ 4,451.2 As of December 31, 2015 Current assets, excluding discontinued operations $ 33.5 $ 190.4 $ 9.8 $ (10.0 ) $ 223.7 Property and equipment, net 23.9 2,826.9 5.2 — 2,856.0 Goodwill — 914.6 — — 914.6 Intangible assets, net — 479.5 — — 479.5 Other non-current assets 17.7 3.1 26.4 — 47.2 Investment in subsidiaries 4,636.6 — — (4,636.6 ) — Assets of discontinued operations held for sale 0.3 9.6 — — 9.9 Inter-company — 703.3 — (703.3 ) — Total assets $ 4,712.0 $ 5,127.4 $ 41.4 $ (5,349.9 ) $ 4,530.9 Current liabilities $ 96.5 $ 239.8 $ — $ (10.0 ) $ 326.3 Long-term debt less current portion 3,616.6 0.1 — — 3,616.7 Other non-current liabilities (56.6 ) 281.0 — — 224.4 Inter-company 702.1 — 1.2 (703.3 ) — Total liabilities 4,358.6 520.9 1.2 (713.3 ) 4,167.4 Total Pinnacle stockholders’ equity 353.4 4,606.5 30.1 (4,636.6 ) 353.4 Non-controlling interest — — 10.1 — 10.1 Total stockholders’ equity 353.4 4,606.5 40.2 (4,636.6 ) 363.5 Total liabilities and stockholders’ equity $ 4,712.0 $ 5,127.4 $ 41.4 $ (5,349.9 ) $ 4,530.9 Pinnacle Entertainment, Inc. 100% Owned Guarantor Non- Guarantor Subsidiaries(b) Consolidating and Eliminating Entries Pinnacle Entertainment, Inc. Consolidated (in millions) Statements of Cash Flows For the three months ended March 31, 2016 Cash provided by (used in) operating activities $ (34.1 ) $ 109.8 $ 9.8 $ — $ 85.5 Capital expenditures (4.4 ) (17.5 ) — — (21.9 ) Net proceeds from disposition of asset held for sale 0.3 — — — 0.3 Loans receivable — — (0.7 ) — (0.7 ) Net transfers to (from) affiliates 145.1 — — (145.1 ) — Cash provided by (used in) investing activities 141.0 (17.5 ) (0.7 ) (145.1 ) (22.3 ) Proceeds from credit facility 64.0 — — — 64.0 Repayments under credit facility (169.3 ) — — — (169.3 ) Net transfers to (from) affiliates — (142.0 ) (3.1 ) 145.1 — Other (0.6 ) — — — (0.6 ) Cash provided by (used in) financing activities (105.9 ) (142.0 ) (3.1 ) 145.1 (105.9 ) Change in cash and cash equivalents 1.0 (49.7 ) 6.0 — (42.7 ) Cash and cash equivalents, beginning of period 1.5 162.5 — — 164.0 Cash and cash equivalents, end of period $ 2.5 $ 112.8 $ 6.0 $ — $ 121.3 For the three months ended March 31, 2015 Cash provided by (used in) operating activities $ 115.0 $ (25.4 ) $ 23.5 $ — $ 113.1 Capital expenditures (2.1 ) (19.0 ) — — (21.1 ) Other — 0.3 (0.8 ) — (0.5 ) Cash used in investing activities (2.1 ) (18.7 ) (0.8 ) — (21.6 ) Proceeds from credit facility 35.0 — — — 35.0 Repayments under credit facility (137.8 ) — — — (137.8 ) Other 5.9 — — — 5.9 Cash used in financing activities (96.9 ) — — — (96.9 ) Change in cash and cash equivalents 16.0 (44.1 ) 22.7 — (5.4 ) Cash and cash equivalents, beginning of period 6.4 158.3 — — 164.7 Cash and cash equivalents, end of period $ 22.4 $ 114.2 $ 22.7 $ — $ 159.3 _______________________ (a) The following material subsidiaries are identified as guarantors of our senior and senior subordinated notes: Belterra Resort Indiana, LLC; Boomtown, LLC; Casino Magic, LLC; Louisiana-I Gaming; PNK (Baton Rouge) Partnership; PNK (BOSSIER CITY), LLC; PNK Development 7, LLC; PNK Development 8, LLC; PNK Development 9, LLC; PNK (LAKE CHARLES), L.L.C.; PNK (Ohio), LLC; PNK (Ohio) II, LLC; PNK (Ohio) III, LLC; PNK (River City), LLC; PNK (SAM), LLC; PNK (SAZ), LLC; Ameristar Casino Black Hawk, LLC; Ameristar Casino Council Bluffs, LLC; Ameristar Casino St. Charles, LLC; Ameristar Casino Kansas City, LLC; PNK Vicksburg, LLC; Cactus Pete’s, LLC; Ameristar East Chicago Holdings, LLC; and Ameristar Casino East Chicago, LLC. In addition, certain other immaterial subsidiaries are also guarantors of our senior and senior subordinated notes. (b) Guarantor subsidiaries of our senior and senior subordinated notes exclude subsidiaries with approximately $38.3 million in cash and other assets as of March 31, 2016 , that include a subsidiary that owns a majority interest in the licensee of Retama Park Racetrack and certain other subsidiaries. |
Segment Information (Tables)
Segment Information (Tables) | 3 Months Ended |
Mar. 31, 2016 | |
Segment Reporting [Abstract] | |
Schedule of Segment Reporting Information, by Segment | The following table highlights our Adjusted EBITDA for each segment and reconciles Consolidated Adjusted EBITDA to Income from continuing operations for the three months ended March 31, 2016 , and 2015 . For the three months ended March 31, 2016 2015 (in millions) Revenues: Midwest segment (a) $ 328.6 $ 313.9 South segment (a) 193.7 203.7 West segment (a) 56.5 53.7 578.8 571.3 Corporate and other (c) 1.2 1.5 Total revenues $ 580.0 $ 572.8 Adjusted EBITDA (b): Midwest segment (a) $ 107.5 $ 100.8 South segment (a) 64.6 67.5 West segment (a) 20.9 20.7 193.0 189.0 Corporate expenses and other (c) (20.6 ) (19.3 ) Consolidated Adjusted EBITDA (b) 172.4 169.7 Other costs: Depreciation and amortization (54.1 ) (67.8 ) Pre-opening, development and other costs (5.3 ) (1.6 ) Non-cash share-based compensation expense (4.4 ) (4.1 ) Write-downs, reserves and recoveries, net (2.9 ) (3.1 ) Interest expense, net (59.8 ) (61.1 ) Loss from equity method investment — (0.1 ) Income tax expense (5.0 ) (4.8 ) Income from continuing operations $ 40.9 $ 27.1 For the three months ended March 31, 2016 2015 (in millions) Capital expenditures: Midwest segment (a) $ 9.2 $ 10.5 South segment (a) 7.1 7.2 West segment (a) 2.6 1.3 Corporate and other, including development projects 3.0 2.1 $ 21.9 $ 21.1 (a) See Note 1, “Organization and Summary of Significant Accounting Policies,” for listing of properties included in each segment. (b) We define Consolidated Adjusted EBITDA as earnings before interest income and expense, income taxes, depreciation, amortization, pre-opening, development and other costs, non-cash share-based compensation, asset impairment costs, write-downs, reserves, recoveries, corporate-level litigation settlement costs, gain (loss) on sale of certain assets, loss on early extinguishment of debt, gain (loss) on sale of equity security investments, income (loss) from equity method investments, non-controlling interest and discontinued operations. We define Adjusted EBITDA for each reportable segment as earnings before interest income and expense, income taxes, depreciation, amortization, pre-opening, development and other costs, non-cash share-based compensation, asset impairment costs, write-downs, reserves, recoveries, inter-company management fees, gain (loss) on sale of certain assets, gain (loss) on early extinguishment of debt, gain (loss) on sale of discontinued operations, and discontinued operations. We define Adjusted EBITDA margin as Adjusted EBITDA for the segment divided by segment revenues. We use Consolidated Adjusted EBITDA and Adjusted EBITDA for each segment to compare operating results among our properties and between accounting periods. Consolidated Adjusted EBITDA and Adjusted EBITDA have economic substance because they are used by management as measures to analyze the performance of our business and are especially relevant in evaluating large, long-lived casino-hotel projects because they provide a perspective on the current effects of operating decisions separated from the substantial non-operational depreciation charges and financing costs of such projects. We eliminate the results from discontinued operations at the time they are deemed discontinued. We also review pre-opening, development and other costs separately, as such expenses are also included in total project costs when assessing budgets and project returns, and because such costs relate to anticipated future revenues and income. We believe that Consolidated Adjusted EBITDA and Adjusted EBITDA are useful measures for investors because they are indicators of the performance of ongoing business operations. These calculations are commonly used as a basis for investors, analysts and credit rating agencies to evaluate and compare operating performance and value of companies within our industry. In addition, our credit agreement and bond indentures require compliance with financial measures similar to Consolidated Adjusted EBITDA. Consolidated Adjusted EBITDA should not be considered as an alternative to operating income as an indicator of performance, or as an alternative to any other measure provided in accordance with GAAP. Our calculations of Adjusted EBITDA and Consolidated Adjusted EBITDA may be different from the calculation methods used by other companies and, therefore, comparability may be limited. (c) Corporate and other includes revenues from Retama Park Racetrack (which we manage) and the Heartland Poker Tour. Corporate expenses represent payroll, professional fees, travel expenses and other general and administrative expenses not directly related to our casino and hotel operations. Corporate expenses that are directly attributable to a property are allocated to each applicable property. All other costs incurred relating to the management and consulting services provided by corporate headquarters to the properties are allocated to those properties based on their respective share of the monthly consolidated net revenues in the form of a management fee. The corporate management fee is excluded in the calculation of segment Adjusted EBITDA and is completely eliminated in any consolidated financial results. |
Organization and Summary of S26
Organization and Summary of Significant Accounting Policies - Additional Information (Details) $ / shares in Units, shares in Millions, $ in Millions | 3 Months Ended | ||||
Mar. 31, 2016USD ($)propertysegment$ / sharesshares | Mar. 31, 2015shares | Apr. 28, 2016$ / shares | Dec. 31, 2015USD ($)$ / shares | Jul. 20, 2015$ / shares | |
Accounting Policies [Line Items] | |||||
Number of casinos owned and operated | property | 15 | ||||
Common stock, par value per share (in dollars per share) | $ / shares | $ 0.10 | $ 0.10 | $ 0.10 | ||
Land not used in operations | $ | $ 35.8 | ||||
Share-based awards | |||||
Accounting Policies [Line Items] | |||||
Out-of-the-money share-based awards excluded from calculation of diluted earnings per share (in shares) | shares | 1.1 | 1.4 | |||
Other accrued liabilities | |||||
Accounting Policies [Line Items] | |||||
Customer Loyalty Program liability | $ | $ 27 | $ 25.4 | |||
OpCo | Subsequent Event | |||||
Accounting Policies [Line Items] | |||||
Common stock conversion ratio | 1 | ||||
Common stock, par value per share (in dollars per share) | $ / shares | $ 0.01 | ||||
Jackpot, Nevada | |||||
Accounting Policies [Line Items] | |||||
Number of casinos owned and operated | property | 2 | ||||
Number of operating segments | segment | 1 |
Organization and Summary of S27
Organization and Summary of Significant Accounting Policies - Summary of Fair Value Measurements (Details) - USD ($) $ in Millions | Mar. 31, 2016 | Dec. 31, 2015 |
Assets: | ||
Held-to-maturity securities | $ 14.4 | $ 14.4 |
Promissory notes | 14.9 | 14.1 |
Liabilities: | ||
Long-term debt | 3,525.7 | 3,627.7 |
Recurring | ||
Liabilities: | ||
Deferred compensation | 0.4 | 0.4 |
Recurring | Level 1 | ||
Liabilities: | ||
Deferred compensation | 0.4 | 0.4 |
Recurring | Level 2 | ||
Liabilities: | ||
Deferred compensation | 0 | 0 |
Recurring | Level 3 | ||
Liabilities: | ||
Deferred compensation | 0 | 0 |
Nonrecurring | ||
Assets: | ||
Held-to-maturity securities, fair value | 15.5 | 15.2 |
Promissory notes, fair value | 19.4 | 19.2 |
Liabilities: | ||
Long-term debt, fair value | 3,673 | 3,740.6 |
Nonrecurring | Level 1 | ||
Assets: | ||
Held-to-maturity securities, fair value | 0 | 0 |
Promissory notes, fair value | 0 | 0 |
Liabilities: | ||
Long-term debt, fair value | 0 | 0 |
Nonrecurring | Level 2 | ||
Assets: | ||
Held-to-maturity securities, fair value | 12.4 | 12.1 |
Promissory notes, fair value | 19.4 | 19.2 |
Liabilities: | ||
Long-term debt, fair value | 3,673 | 3,740.6 |
Nonrecurring | Level 3 | ||
Assets: | ||
Held-to-maturity securities, fair value | 3.1 | 3.1 |
Promissory notes, fair value | 0 | 0 |
Liabilities: | ||
Long-term debt, fair value | $ 0 | $ 0 |
Organization and Summary of S28
Organization and Summary of Significant Accounting Policies - Summary of Land, Buildings, Vessels and Equipment (Details) - USD ($) $ in Thousands | Mar. 31, 2016 | Dec. 31, 2015 |
Land, buildings, vessels and equipment: | ||
Land and land improvements | $ 424,627 | $ 422,771 |
Buildings, vessels and improvements | 2,675,341 | 2,674,602 |
Furniture, fixtures and equipment | 767,529 | 763,812 |
Construction in progress | 37,209 | 33,196 |
Land, buildings, vessels and equipment, gross | 3,904,706 | 3,894,381 |
Less: accumulated depreciation | (1,081,342) | (1,038,370) |
Land, buildings, vessels and equipment, net | $ 2,823,364 | $ 2,856,011 |
Organization and Summary of S29
Organization and Summary of Significant Accounting Policies - Summary of Complimentary Revenue and Associated Costs (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Food and beverage | $ 33.8 | $ 35.2 |
Lodging | 15.8 | 15.2 |
Other | 3.7 | 4.4 |
Total promotional allowances | 53.3 | 54.8 |
Promotional allowance costs included in gaming expense | $ 38.2 | $ 39.3 |
Organization and Summary of S30
Organization and Summary of Significant Accounting Policies - Summary of Gaming Taxes (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Gaming taxes | $ 145.8 | $ 144.7 |
Organization and Summary of S31
Organization and Summary of Significant Accounting Policies - Schedule of Pre-opening, Development and Other Costs (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2016 | Mar. 31, 2015 | ||
Pre-opening and Development Costs [Line Items] | |||
Restructuring costs | [1] | $ 3,500 | $ 700 |
Pre-opening, development and other costs | 5,329 | 1,567 | |
Other | |||
Pre-opening and Development Costs [Line Items] | |||
Pre-opening, development and other costs | 100 | 900 | |
The Meadows Racetrack and Casino | |||
Pre-opening and Development Costs [Line Items] | |||
Meadows acquisition costs | [2] | $ 1,700 | $ 0 |
[1] | Amounts comprised of costs associated with the separation of Former Pinnacle’s real estate assets from its operating assets. See Note 6, “Investment, Restructuring and Acquisition Activities.” | ||
[2] | Amount comprised of costs associated with the Company’s acquisition of The Meadows Racetrack and Casino (“Meadows”) business. See Note 6, “Investment, Restructuring and Acquisition Activities.” |
Long-Term Debt - Schedule of Lo
Long-Term Debt - Schedule of Long-Term Debt (Details) - USD ($) $ in Thousands | Mar. 31, 2016 | Dec. 31, 2015 |
Debt Instrument [Line Items] | ||
Outstanding principal | $ 3,512,200 | $ 3,617,400 |
Unamortized (discount) premium | 37,400 | 35,800 |
Unamortized debt issuance costs | (23,900) | (25,500) |
Long-term debt, including current portion | 3,525,700 | 3,627,700 |
Less: current maturities | (11,006) | (11,006) |
Long-term debt, noncurrent, outstanding principal | 3,501,200 | 3,606,400 |
Long-term debt less current portion | 3,514,731 | 3,616,729 |
Revolving Credit Facility due 2018 | ||
Debt Instrument [Line Items] | ||
Outstanding principal | 750,100 | 750,100 |
Unamortized (discount) premium | 0 | 0 |
Unamortized debt issuance costs | 0 | 0 |
Long-term debt, including current portion | 750,100 | 750,100 |
B-2 Term Loans due 2020 | ||
Debt Instrument [Line Items] | ||
Outstanding principal | 197,000 | 302,200 |
Unamortized (discount) premium | (7,400) | (10,900) |
Unamortized debt issuance costs | (1,700) | (2,400) |
Long-term debt, including current portion | 187,900 | 288,900 |
6.375% Senior Notes due 2021 | ||
Debt Instrument [Line Items] | ||
Outstanding principal | 850,000 | 850,000 |
Unamortized (discount) premium | 0 | 0 |
Unamortized debt issuance costs | (12,500) | (13,000) |
Long-term debt, including current portion | 837,500 | 837,000 |
7.50% Senior Notes due 2021 | ||
Debt Instrument [Line Items] | ||
Outstanding principal | 1,040,000 | 1,040,000 |
Unamortized (discount) premium | 44,800 | 46,700 |
Unamortized debt issuance costs | 0 | 0 |
Long-term debt, including current portion | 1,084,800 | 1,086,700 |
7.75% Senior Subordinated Notes due 2022 | ||
Debt Instrument [Line Items] | ||
Outstanding principal | 325,000 | 325,000 |
Unamortized (discount) premium | 0 | 0 |
Unamortized debt issuance costs | (4,600) | (4,700) |
Long-term debt, including current portion | 320,400 | 320,300 |
8.75% Senior Subordinated Notes due 2020 | ||
Debt Instrument [Line Items] | ||
Outstanding principal | 350,000 | 350,000 |
Unamortized (discount) premium | 0 | 0 |
Unamortized debt issuance costs | (5,100) | (5,400) |
Long-term debt, including current portion | 344,900 | 344,600 |
Other | ||
Debt Instrument [Line Items] | ||
Outstanding principal | 100 | 100 |
Unamortized (discount) premium | 0 | 0 |
Unamortized debt issuance costs | 0 | 0 |
Long-term debt, including current portion | $ 100 | $ 100 |
Long-Term Debt - Additional Inf
Long-Term Debt - Additional Information (Details) - USD ($) | Apr. 28, 2016 | Aug. 31, 2013 | Mar. 31, 2012 | May. 31, 2010 | Mar. 31, 2016 | Dec. 31, 2015 |
Debt Instrument [Line Items] | ||||||
Long-term debt, outstanding principal | $ 3,512,200,000 | $ 3,617,400,000 | ||||
Term Loans | ||||||
Debt Instrument [Line Items] | ||||||
Line of credit, maximum borrowing capacity | $ 1,600,000,000 | |||||
Term B1 due 2016 | ||||||
Debt Instrument [Line Items] | ||||||
Line of credit, maximum borrowing capacity | 500,000,000 | |||||
Revolving Credit Facility due 2018 | ||||||
Debt Instrument [Line Items] | ||||||
Line of credit, maximum borrowing capacity | 1,000,000,000 | |||||
Long-term debt, outstanding principal | 750,100,000 | 750,100,000 | ||||
B-2 Term Loans due 2020 | ||||||
Debt Instrument [Line Items] | ||||||
Line of credit, maximum borrowing capacity | $ 1,100,000,000 | |||||
Long-term debt, outstanding principal | 197,000,000 | 302,200,000 | ||||
Letters of credit | ||||||
Debt Instrument [Line Items] | ||||||
Letters of credit outstanding, amount | 12,000,000 | |||||
6.375% Senior Notes due 2021 | ||||||
Debt Instrument [Line Items] | ||||||
Long-term debt, outstanding principal | $ 850,000,000 | $ 850,000,000 | ||||
Interest rate, stated percentage | 6.375% | 6.375% | 6.375% | |||
Debt instrument, face amount | $ 850,000,000 | |||||
Proceeds from issuance of senior long-term debt | $ 835,000,000 | |||||
7.50% Senior Notes due 2021 | ||||||
Debt Instrument [Line Items] | ||||||
Long-term debt, outstanding principal | $ 1,040,000,000 | $ 1,040,000,000 | ||||
Interest rate, stated percentage | 7.50% | 7.50% | 7.50% | |||
Debt instrument, face amount | $ 1,040,000,000 | |||||
Premium included in recorded fair value of senior notes | $ 72,800,000 | |||||
7.75% Senior Subordinated Notes due 2022 | ||||||
Debt Instrument [Line Items] | ||||||
Long-term debt, outstanding principal | $ 325,000,000 | $ 325,000,000 | ||||
Interest rate, stated percentage | 7.75% | 7.75% | 7.75% | |||
Debt instrument, face amount | $ 325,000,000 | |||||
Proceeds from issuance of senior long-term debt | $ 318,300,000 | |||||
8.75% Senior Subordinated Notes due 2020 | ||||||
Debt Instrument [Line Items] | ||||||
Long-term debt, outstanding principal | $ 350,000,000 | $ 350,000,000 | ||||
Interest rate, stated percentage | 8.75% | 8.75% | 8.75% | |||
Debt instrument, face amount | $ 350,000,000 | |||||
Proceeds from issuance of senior long-term debt | $ 341,500,000 | |||||
Subsequent Event | ||||||
Debt Instrument [Line Items] | ||||||
OpCo cash payment | $ 808,400,000 | |||||
Principal amount of debt to be refinanced by GLPI | 2,700,000,000 | |||||
Subsequent Event | OpCo Term Loan A Facility | ||||||
Debt Instrument [Line Items] | ||||||
Line of credit, maximum borrowing capacity | $ 185,000,000 | |||||
Debt instrument maturity | 5 years | |||||
Spread on LIBOR loan | 2.00% | |||||
Spread on base rate loan | 1.00% | |||||
Spread on LIBOR loan (minimum) | 1.50% | |||||
Spread on LIBOR loan (maximum) | 2.50% | |||||
Spread on base rate loan (minimum) | 0.50% | |||||
Spread on base rate loan (maximum) | 1.50% | |||||
Subsequent Event | OpCo Term Loan B Facility | ||||||
Debt Instrument [Line Items] | ||||||
Line of credit, maximum borrowing capacity | $ 300,000,000 | |||||
Debt instrument maturity | 7 years | |||||
Spread on LIBOR loan | 3.00% | |||||
Spread on base rate loan | 2.00% | |||||
Subsequent Event | OpCo Revolving Credit Facility | ||||||
Debt Instrument [Line Items] | ||||||
Line of credit, maximum borrowing capacity | $ 400,000,000 | |||||
Debt instrument maturity | 5 years | |||||
Spread on LIBOR loan | 2.00% | |||||
Spread on base rate loan | 1.00% | |||||
Spread on LIBOR loan (minimum) | 1.50% | |||||
Spread on LIBOR loan (maximum) | 2.50% | |||||
Spread on base rate loan (minimum) | 0.50% | |||||
Spread on base rate loan (maximum) | 1.50% | |||||
Commitment fee (minimum) | 0.30% | |||||
Commitment fee (maximum) | 0.50% | |||||
Subsequent Event | 5.625% Senior Unsecured Notes due 2024 | ||||||
Debt Instrument [Line Items] | ||||||
Interest rate, stated percentage | 5.625% | |||||
Debt instrument, face amount | $ 375,000,000 | |||||
Proceeds from issuance of senior long-term debt | $ 369,400,000 |
Long-Term Debt - Summary of Int
Long-Term Debt - Summary of Interest Expense (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Debt Disclosure [Abstract] | ||
Interest expense | $ 59,900 | $ 61,100 |
Interest income | (100) | 0 |
Interest expense, net | $ 59,793 | $ 61,083 |
Income Taxes (Details)
Income Taxes (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Income Tax Disclosure [Abstract] | ||
Effective income tax rate for continuing operations | 10.90% | 15.10% |
Income tax expense | $ 4,998 | $ 4,832 |
Federal statutory income tax rate | 35.00% |
Employee Benefit Plans - Additi
Employee Benefit Plans - Additional Information (Details) - USD ($) $ in Thousands, shares in Millions | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Share-based awards outstanding (in shares) | 7.4 | |
Share-based awards available for grant (in shares) | 0.2 | |
Share-based compensation expense | $ 4,400 | $ 4,100 |
Unamortized compensation costs not yet expensed, options | 11,300 | |
Cash received as a result of exercise of stock options | 215 | 6,146 |
Unamortized compensation costs not yet expensed, non-vested restricted stock units | $ 23,400 | |
Stock Options | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Weighted average period over which costs will be recognized | 1 year | |
Cash received as a result of exercise of stock options | $ 200 | $ 6,100 |
Restricted Stock | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Weighted average period over which costs will be recognized | 1 year |
Employee Benefit Plans - Summar
Employee Benefit Plans - Summary of Stock Options Activity (Details) - Stock Options - $ / shares | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Number of Stock Options | ||
Options outstanding as of January 1, 2016 (in shares) | 5,375,476 | |
Granted | 0 | |
Exercised | (14,405) | |
Canceled or forfeited | (2,675) | |
Options outstanding as of March 31, 2016 (in shares) | 5,358,396 | |
Options exercisable as of March 31, 2016 | 3,766,337 | |
Expected to vest as of March 31, 2016 | 1,301,667 | |
Weighted Average Exercise Price | ||
Options outstanding as of January 1, 2016 (in dollars per share) | $ 16.04 | |
Granted | 0 | |
Exercised | 14.90 | |
Canceled or forfeited | 23.23 | |
Options outstanding as of March 31, 2016 (in dollars per share) | 16.04 | |
Options exercisable as of March 31, 2016 | 13.13 | |
Expected to vest as of March 31, 2016 | 23.09 | |
Weighted average grant date fair value of stock options | $ 0 | $ 9.44 |
Employee Benefit Plans - Summ38
Employee Benefit Plans - Summary of Restricted Stock Activity (Details) - Restricted Stock | 3 Months Ended |
Mar. 31, 2016$ / sharesshares | |
Number of Units | |
Non-vested as of January 1, 2016 (in shares) | shares | 1,311,423 |
Granted | shares | 4,105 |
Vested | shares | (44,579) |
Canceled or forfeited | shares | (4,443) |
Non-vested as of March 31, 2016 (in shares) | shares | 1,266,506 |
Weighted Average Grant Date Fair Value | |
Non-vested at January 1, 2016 (in dollars per share) | $ / shares | $ 25.16 |
Granted | $ / shares | 31.68 |
Vested | $ / shares | 26.50 |
Canceled or forfeited | $ / shares | 28.74 |
Non-vested at March 31, 2016 (in dollars per share) | $ / shares | $ 25.12 |
Employee Benefit Plans - Summ39
Employee Benefit Plans - Summary of Performance Stock Activity (Details) - Performance Stock Units | 3 Months Ended |
Mar. 31, 2016$ / sharesshares | |
Number of Units | |
Non-vested as of January 1, 2016 (in shares) | shares | 408,228 |
Granted | shares | 0 |
Canceled or forfeited | shares | 0 |
Non-vested as of March 31, 2016 (in shares) | shares | 408,228 |
Weighted Average Grant Date Fair Value | |
Non-vested at January 1, 2016 (in dollars per share) | $ / shares | $ 23.23 |
Granted | $ / shares | 0 |
Canceled or forfeited | $ / shares | 0 |
Non-vested at March 31, 2016 (in dollars per share) | $ / shares | $ 23.23 |
Write-downs, Reserves and Rec40
Write-downs, Reserves and Recoveries, Net - Summary of Write-downs, Reserves and Recoveries, Net (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Write Downs, Reserves and Recoveries, Net [Line Items] | ||
Impairment of long-lived assets | $ 174 | $ 2,769 |
Write-downs, reserves and recoveries, net | 2,890 | 3,144 |
Continuing Operations [Member] | ||
Write Downs, Reserves and Recoveries, Net [Line Items] | ||
Loss on disposals of long-lived assets, net | 2,700 | 400 |
Impairment of long-lived assets | $ 200 | $ 2,700 |
Write-downs, Reserves and Rec41
Write-downs, Reserves and Recoveries, Net (Details) $ in Millions | 3 Months Ended |
Mar. 31, 2015USD ($) | |
Write-downs, reserves and recoveries, net | Central City, Colorado | |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |
Impairment of land | $ 2.6 |
Investment, Restructuring and42
Investment, Restructuring and Acquisition Activities Investment, Restructuring and Acquisition Activities - Merger Agreement (Details) $ / shares in Units, $ in Millions | Apr. 28, 2016USD ($) | Jul. 20, 2015USD ($)extension_period$ / shares | Mar. 31, 2016$ / shares | Dec. 31, 2015$ / shares |
Restructuring and Related Activities [Line Items] | ||||
Common stock, par value per share (in dollars per share) | $ / shares | $ 0.10 | $ 0.10 | $ 0.10 | |
Master Lease | ||||
Restructuring and Related Activities [Line Items] | ||||
Initial lease term | 10 years | |||
Number of renewal options | extension_period | 5 | |||
Lease term in renewal periods | 5 years | |||
First annual rent payment | $ 377 | |||
Gaming and Leisure Properties, Inc. | ||||
Restructuring and Related Activities [Line Items] | ||||
Common stock, par value per share (in dollars per share) | $ / shares | $ 0.01 | |||
Common stock conversion ratio | 0.85 | |||
Subsequent Event | ||||
Restructuring and Related Activities [Line Items] | ||||
OpCo cash payment | $ 808.4 | |||
Principal amount of debt to be refinanced by GLPI | $ 2,700 |
Investment, Restructuring and43
Investment, Restructuring and Acquisition Activities Investment, Restructuring and Acquisition Activities - Acquisitions (Details) $ in Millions | Mar. 29, 2016USD ($) |
The Meadows Racetrack and Casino | |
Business Acquisition [Line Items] | |
Total consideration | $ 138 |
Meadows Lease | |
Business Acquisition [Line Items] | |
Initial lease term | 10 years |
Total lease term | 29 years |
First annual rent payment | $ 25.5 |
First annual rent payment - base rent | 14 |
First annual rent payment - percentage rent | $ 11.5 |
Percentage rent adjustment term | 2 years |
Investment, Restructuring and44
Investment, Restructuring and Acquisition Activities - Additional Information (Details) - USD ($) $ in Millions | Mar. 31, 2016 | Dec. 31, 2015 |
Schedule of Equity Method Investments | ||
Equity method investments, carrying value | $ 1.7 | $ 1.7 |
Promissory notes | 14.9 | 14.1 |
Corporate bonds | $ 14.4 | $ 14.4 |
Retama Partners | ||
Schedule of Equity Method Investments | ||
Percentage of voting interests acquired | 75.50% | |
Local government corporation bonds | ||
Schedule of Equity Method Investments | ||
Corporate bonds | $ 11.3 |
Discontinued Operations and A45
Discontinued Operations and Assets Held for Sale - Additional Information (Details) $ in Millions | 1 Months Ended | 3 Months Ended | ||
Mar. 31, 2016USD ($)a | Nov. 30, 2013USD ($) | Mar. 31, 2016USD ($)a | Mar. 31, 2015USD ($) | |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||
Income before income tax from discontinued operations | $ 0.1 | $ 0.2 | ||
Central City, Colorado | ||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||
Additional land for sale (acres) | a | 2 | 2 | ||
Land available-for-sale | $ 0.3 | $ 0.3 | ||
Cash proceeds from sale of land | $ 0.3 | |||
Ameristar Lake Charles | ||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||
Cash consideration | $ 209.8 | |||
Deferred consideration | $ 10 | |||
Write-downs, reserves and recoveries, net | Central City, Colorado | ||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||
Impairment charge | $ 2.6 |
Discontinued Operations and A46
Discontinued Operations and Assets Held for Sale - Net Assets for Entities and Operations Included in Discontinued Operations (Details) - USD ($) $ in Thousands | Mar. 31, 2016 | Dec. 31, 2015 |
Assets: | ||
Land, buildings, vessels and equipment, net | $ 0 | $ 300 |
Other assets, net | 9,800 | 9,600 |
Total assets | $ 9,780 | $ 9,938 |
Commitments and Contingencies (
Commitments and Contingencies (Details) $ in Millions | 3 Months Ended | ||
Mar. 31, 2016USD ($)hearing | Dec. 31, 2015USD ($) | Dec. 31, 2010USD ($) | |
Long-term Purchase Commitment [Line Items] | |||
Self-insurance accruals | $ 25.6 | $ 25.5 | |
Indiana Income Tax | |||
Long-term Purchase Commitment [Line Items] | |||
Proposed adjustment excluding interest and penalties | $ 7.3 | ||
Number of hearings with IDR | hearing | 2 | ||
Minimum | Indiana Income Tax | |||
Long-term Purchase Commitment [Line Items] | |||
Year under Examination | 2,005 | ||
Maximum | Indiana Income Tax | |||
Long-term Purchase Commitment [Line Items] | |||
Year under Examination | 2,007 |
Consolidating Condensed Finan48
Consolidating Condensed Financial Information - Statements of Operations (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2016 | Mar. 31, 2015 | ||
Condensed Financial Statements | |||
Subsidiary reporting information, assets | $ 38,300 | ||
Revenues: | |||
Gaming | 520,841 | $ 514,347 | |
Food and beverage | 31,995 | 32,030 | |
Lodging | 11,247 | 11,495 | |
Retail, entertainment and other | 15,942 | 14,967 | |
Total revenues | 580,025 | 572,839 | |
Expenses and other costs: | |||
Gaming | 267,133 | 264,885 | |
Food and beverage | 29,910 | 29,167 | |
Lodging | 5,608 | 5,788 | |
Retail, entertainment and other | 4,513 | 5,090 | |
General and administrative | 104,862 | 102,290 | |
Depreciation and amortization | 54,096 | 67,831 | |
Pre-opening, development and other costs | 5,329 | 1,567 | |
Write-downs, reserves and recoveries, net | 2,890 | 3,144 | |
Total expenses and other costs | 474,341 | 479,762 | |
Operating income | 105,684 | 93,077 | |
Interest expense, net | (59,793) | (61,083) | |
Loss from equity method investment | 0 | (83) | |
Income tax expense | (4,998) | (4,832) | |
Income from continuing operations | 40,893 | 27,079 | |
Income from discontinued operations, net of income taxes | 125 | 217 | |
Net income | 41,018 | 27,296 | |
Pinnacle Entertainment, Inc. | |||
Revenues: | |||
Gaming | 0 | 0 | |
Food and beverage | 0 | 0 | |
Lodging | 0 | 0 | |
Retail, entertainment and other | 0 | 0 | |
Total revenues | 0 | 0 | |
Expenses and other costs: | |||
Gaming | 0 | 0 | |
Food and beverage | 0 | 0 | |
Lodging | 0 | 0 | |
Retail, entertainment and other | 0 | 0 | |
General and administrative | 23,300 | 22,300 | |
Depreciation and amortization | 2,000 | 4,300 | |
Pre-opening, development and other costs | 5,300 | 1,400 | |
Write-downs, reserves and recoveries, net | 0 | 3,000 | |
Total expenses and other costs | 30,600 | 31,000 | |
Operating income | (30,600) | (31,000) | |
Equity in earnings of subsidiaries | 102,700 | 88,300 | |
Interest expense, net | (59,800) | (61,100) | |
Loss from equity method investment | 0 | ||
Income (loss) from continuing operations before inter-company activity and income taxes | 12,300 | (3,800) | |
Management fee and inter-company interest | 33,700 | 35,900 | |
Income tax expense | (5,000) | (4,800) | |
Income from continuing operations | 41,000 | 27,300 | |
Income from discontinued operations, net of income taxes | 0 | 0 | |
Net income | 41,000 | 27,300 | |
100% Owned Guarantor Subsidiaries | |||
Revenues: | |||
Gaming | [1] | 520,800 | 514,400 |
Food and beverage | [1] | 32,000 | 32,000 |
Lodging | [1] | 11,300 | 11,500 |
Retail, entertainment and other | [1] | 15,900 | 14,900 |
Total revenues | [1] | 580,000 | 572,800 |
Expenses and other costs: | |||
Gaming | [1] | 267,100 | 264,900 |
Food and beverage | [1] | 29,900 | 29,200 |
Lodging | [1] | 5,600 | 5,800 |
Retail, entertainment and other | [1] | 4,500 | 5,100 |
General and administrative | [1] | 81,600 | 79,900 |
Depreciation and amortization | [1] | 52,100 | 63,500 |
Pre-opening, development and other costs | [1] | 0 | 100 |
Write-downs, reserves and recoveries, net | [1] | 2,900 | 200 |
Total expenses and other costs | [1] | 443,700 | 448,700 |
Operating income | [1] | 136,300 | 124,100 |
Equity in earnings of subsidiaries | [1] | 0 | 0 |
Interest expense, net | [1] | 0 | 0 |
Loss from equity method investment | [1] | 0 | |
Income (loss) from continuing operations before inter-company activity and income taxes | [1] | 136,300 | 124,100 |
Management fee and inter-company interest | [1] | (33,700) | (35,900) |
Income tax expense | [1] | 0 | 0 |
Income from continuing operations | [1] | 102,600 | 88,200 |
Income from discontinued operations, net of income taxes | [1] | 100 | 200 |
Net income | [1] | 102,700 | 88,400 |
Non-Guarantor Subsidiaries | |||
Revenues: | |||
Gaming | [2] | 0 | 0 |
Food and beverage | [2] | 0 | 0 |
Lodging | [2] | 0 | 0 |
Retail, entertainment and other | [2] | 0 | 0 |
Total revenues | [2] | 0 | 0 |
Expenses and other costs: | |||
Gaming | [2] | 0 | 0 |
Food and beverage | [2] | 0 | 0 |
Lodging | [2] | 0 | 0 |
Retail, entertainment and other | [2] | 0 | 0 |
General and administrative | [2] | 0 | 0 |
Depreciation and amortization | [2] | 0 | 0 |
Pre-opening, development and other costs | [2] | 0 | 0 |
Write-downs, reserves and recoveries, net | [2] | 0 | 0 |
Total expenses and other costs | [2] | 0 | 0 |
Operating income | [2] | 0 | 0 |
Equity in earnings of subsidiaries | [2] | 0 | 0 |
Interest expense, net | [2] | 0 | 0 |
Loss from equity method investment | [2] | (100) | |
Income (loss) from continuing operations before inter-company activity and income taxes | [2] | 0 | (100) |
Management fee and inter-company interest | [2] | 0 | 0 |
Income tax expense | [2] | 0 | 0 |
Income from continuing operations | [2] | 0 | (100) |
Income from discontinued operations, net of income taxes | [2] | 0 | 0 |
Net income | [2] | 0 | (100) |
Consolidating and Eliminating Entries | |||
Revenues: | |||
Gaming | 0 | 0 | |
Food and beverage | 0 | 0 | |
Lodging | 0 | 0 | |
Retail, entertainment and other | 0 | 0 | |
Total revenues | 0 | 0 | |
Expenses and other costs: | |||
Gaming | 0 | 0 | |
Food and beverage | 0 | 0 | |
Lodging | 0 | 0 | |
Retail, entertainment and other | 0 | 0 | |
General and administrative | 0 | 0 | |
Depreciation and amortization | 0 | 0 | |
Pre-opening, development and other costs | 0 | 0 | |
Write-downs, reserves and recoveries, net | 0 | 0 | |
Total expenses and other costs | 0 | 0 | |
Operating income | 0 | 0 | |
Equity in earnings of subsidiaries | (102,700) | (88,300) | |
Interest expense, net | 0 | 0 | |
Loss from equity method investment | 0 | ||
Income (loss) from continuing operations before inter-company activity and income taxes | (102,700) | (88,300) | |
Management fee and inter-company interest | 0 | 0 | |
Income tax expense | 0 | 0 | |
Income from continuing operations | (102,700) | (88,300) | |
Income from discontinued operations, net of income taxes | 0 | 0 | |
Net income | (102,700) | (88,300) | |
Pinnacle Entertainment, Inc. Consolidated | |||
Revenues: | |||
Gaming | 520,800 | 514,400 | |
Food and beverage | 32,000 | 32,000 | |
Lodging | 11,300 | 11,500 | |
Retail, entertainment and other | 15,900 | 14,900 | |
Total revenues | 580,000 | 572,800 | |
Expenses and other costs: | |||
Gaming | 267,100 | 264,900 | |
Food and beverage | 29,900 | 29,200 | |
Lodging | 5,600 | 5,800 | |
Retail, entertainment and other | 4,500 | 5,100 | |
General and administrative | 104,900 | 102,200 | |
Depreciation and amortization | 54,100 | 67,800 | |
Pre-opening, development and other costs | 5,300 | 1,500 | |
Write-downs, reserves and recoveries, net | 2,900 | 3,200 | |
Total expenses and other costs | 474,300 | 479,700 | |
Operating income | 105,700 | 93,100 | |
Equity in earnings of subsidiaries | 0 | 0 | |
Interest expense, net | (59,800) | (61,100) | |
Loss from equity method investment | (100) | ||
Income (loss) from continuing operations before inter-company activity and income taxes | 45,900 | 31,900 | |
Management fee and inter-company interest | 0 | 0 | |
Income tax expense | (5,000) | (4,800) | |
Income from continuing operations | 40,900 | 27,100 | |
Income from discontinued operations, net of income taxes | 100 | 200 | |
Net income | $ 41,000 | $ 27,300 | |
[1] | he following material subsidiaries are identified as guarantors of our senior and senior subordinated notes: Belterra Resort Indiana, LLC; Boomtown, LLC; Casino Magic, LLC; Louisiana-I Gaming; PNK (Baton Rouge) Partnership; PNK (BOSSIER CITY), LLC; PNK Development 7, LLC; PNK Development 8, LLC; PNK Development 9, LLC; PNK (LAKE CHARLES), L.L.C.; PNK (Ohio), LLC; PNK (Ohio) II, LLC; PNK (Ohio) III, LLC; PNK (River City), LLC; PNK (SAM), LLC; PNK (SAZ), LLC; Ameristar Casino Black Hawk, LLC; Ameristar Casino Council Bluffs, LLC; Ameristar Casino St. Charles, LLC; Ameristar Casino Kansas City, LLC; PNK Vicksburg, LLC; Cactus Pete’s, LLC; Ameristar East Chicago Holdings, LLC; and Ameristar Casino East Chicago, LLC. In addition, certain other immaterial subsidiaries are also guarantors of our senior and senior subordinated notes. | ||
[2] | Guarantor subsidiaries of our senior and senior subordinated notes exclude subsidiaries with approximately $38.3 million in cash and other assets as of March 31, 2016, that include a subsidiary that owns a majority interest in the licensee of Retama Park Racetrack and certain other subsidiaries. |
Consolidating Condensed Finan49
Consolidating Condensed Financial Information - Balance Sheets (Details) - USD ($) $ in Thousands | Mar. 31, 2016 | Dec. 31, 2015 | |
Condensed Financial Statements | |||
Property and equipment, net | $ 2,823,364 | $ 2,856,011 | |
Goodwill | 914,525 | 914,525 | |
Intangible assets, net | 476,573 | 479,543 | |
Assets held for sale and assets of discontinued operations | 9,780 | 9,938 | |
Total assets | 4,451,256 | 4,530,911 | |
Current liabilities | 303,178 | 326,245 | |
Long-term debt less current portion | 3,514,731 | 3,616,729 | |
Total liabilities | 4,042,388 | 4,167,402 | |
Total Pinnacle stockholders’ equity | 398,751 | 353,384 | |
Non-controlling interest | 10,117 | 10,125 | |
Total stockholders’ equity | 408,868 | 363,509 | |
Total liabilities and stockholders’ equity | 4,451,256 | 4,530,911 | |
Pinnacle Entertainment, Inc. | |||
Condensed Financial Statements | |||
Current assets, excluding discontinued operations | 41,500 | 33,500 | |
Property and equipment, net | 25,400 | 23,900 | |
Goodwill | 0 | 0 | |
Intangible assets, net | 0 | 0 | |
Other non-current assets | 16,200 | 17,700 | |
Investment in subsidiaries | 4,676,600 | 4,636,600 | |
Assets held for sale and assets of discontinued operations | 0 | 300 | |
Inter-company | 0 | 0 | |
Total assets | 4,759,700 | 4,712,000 | |
Current liabilities | 117,500 | 96,500 | |
Long-term debt less current portion | 3,514,600 | 3,616,600 | |
Other non-current liabilities | (52,700) | (56,600) | |
Inter-company | 781,600 | 702,100 | |
Total liabilities | 4,361,000 | 4,358,600 | |
Total Pinnacle stockholders’ equity | 398,700 | 353,400 | |
Non-controlling interest | 0 | 0 | |
Total stockholders’ equity | 398,700 | 353,400 | |
Total liabilities and stockholders’ equity | 4,759,700 | 4,712,000 | |
100% Owned Guarantor Subsidiaries | |||
Condensed Financial Statements | |||
Current assets, excluding discontinued operations | [1] | 133,300 | 190,400 |
Property and equipment, net | [1] | 2,792,700 | 2,826,900 |
Goodwill | [1] | 914,600 | 914,600 |
Intangible assets, net | [1] | 476,500 | 479,500 |
Other non-current assets | [1] | 2,900 | 3,100 |
Investment in subsidiaries | [1] | 0 | 0 |
Assets held for sale and assets of discontinued operations | [1] | 9,800 | 9,600 |
Inter-company | [1] | 782,800 | 703,300 |
Total assets | [1] | 5,112,600 | 5,127,400 |
Current liabilities | [1] | 185,700 | 239,800 |
Long-term debt less current portion | [1] | 100 | 100 |
Other non-current liabilities | [1] | 277,200 | 281,000 |
Inter-company | [1] | 0 | 0 |
Total liabilities | [1] | 463,000 | 520,900 |
Total Pinnacle stockholders’ equity | [1] | 4,649,600 | 4,606,500 |
Non-controlling interest | [1] | 0 | 0 |
Total stockholders’ equity | [1] | 4,649,600 | 4,606,500 |
Total liabilities and stockholders’ equity | [1] | 5,112,600 | 5,127,400 |
Non-Guarantor Subsidiaries | |||
Condensed Financial Statements | |||
Current assets, excluding discontinued operations | [2] | 5,900 | 9,800 |
Property and equipment, net | [2] | 5,200 | 5,200 |
Goodwill | [2] | 0 | 0 |
Intangible assets, net | [2] | 0 | 0 |
Other non-current assets | [2] | 27,200 | 26,400 |
Investment in subsidiaries | [2] | 0 | 0 |
Assets held for sale and assets of discontinued operations | [2] | 0 | 0 |
Inter-company | [2] | 0 | 0 |
Total assets | [2] | 38,300 | 41,400 |
Current liabilities | [2] | 0 | 0 |
Long-term debt less current portion | [2] | 0 | 0 |
Other non-current liabilities | [2] | 0 | 0 |
Inter-company | [2] | 1,200 | 1,200 |
Total liabilities | [2] | 1,200 | 1,200 |
Total Pinnacle stockholders’ equity | [2] | 27,000 | 30,100 |
Non-controlling interest | [2] | 10,100 | 10,100 |
Total stockholders’ equity | [2] | 37,100 | 40,200 |
Total liabilities and stockholders’ equity | [2] | 38,300 | 41,400 |
Consolidating and Eliminating Entries | |||
Condensed Financial Statements | |||
Current assets, excluding discontinued operations | 0 | (10,000) | |
Property and equipment, net | 0 | 0 | |
Goodwill | 0 | 0 | |
Intangible assets, net | 0 | 0 | |
Other non-current assets | 0 | 0 | |
Investment in subsidiaries | (4,676,600) | (4,636,600) | |
Assets held for sale and assets of discontinued operations | 0 | 0 | |
Inter-company | (782,800) | (703,300) | |
Total assets | (5,459,400) | (5,349,900) | |
Current liabilities | 0 | (10,000) | |
Long-term debt less current portion | 0 | 0 | |
Other non-current liabilities | 0 | 0 | |
Inter-company | (782,800) | (703,300) | |
Total liabilities | (782,800) | (713,300) | |
Total Pinnacle stockholders’ equity | (4,676,600) | (4,636,600) | |
Non-controlling interest | 0 | 0 | |
Total stockholders’ equity | (4,676,600) | (4,636,600) | |
Total liabilities and stockholders’ equity | (5,459,400) | (5,349,900) | |
Pinnacle Entertainment, Inc. Consolidated | |||
Condensed Financial Statements | |||
Current assets, excluding discontinued operations | 180,700 | 223,700 | |
Property and equipment, net | 2,823,300 | 2,856,000 | |
Goodwill | 914,600 | 914,600 | |
Intangible assets, net | 476,500 | 479,500 | |
Other non-current assets | 46,300 | 47,200 | |
Investment in subsidiaries | 0 | 0 | |
Assets held for sale and assets of discontinued operations | 9,800 | 9,900 | |
Inter-company | 0 | 0 | |
Total assets | 4,451,200 | 4,530,900 | |
Current liabilities | 303,200 | 326,300 | |
Long-term debt less current portion | 3,514,700 | 3,616,700 | |
Other non-current liabilities | 224,500 | 224,400 | |
Inter-company | 0 | 0 | |
Total liabilities | 4,042,400 | 4,167,400 | |
Total Pinnacle stockholders’ equity | 398,700 | 353,400 | |
Non-controlling interest | 10,100 | 10,100 | |
Total stockholders’ equity | 408,800 | 363,500 | |
Total liabilities and stockholders’ equity | $ 4,451,200 | $ 4,530,900 | |
[1] | he following material subsidiaries are identified as guarantors of our senior and senior subordinated notes: Belterra Resort Indiana, LLC; Boomtown, LLC; Casino Magic, LLC; Louisiana-I Gaming; PNK (Baton Rouge) Partnership; PNK (BOSSIER CITY), LLC; PNK Development 7, LLC; PNK Development 8, LLC; PNK Development 9, LLC; PNK (LAKE CHARLES), L.L.C.; PNK (Ohio), LLC; PNK (Ohio) II, LLC; PNK (Ohio) III, LLC; PNK (River City), LLC; PNK (SAM), LLC; PNK (SAZ), LLC; Ameristar Casino Black Hawk, LLC; Ameristar Casino Council Bluffs, LLC; Ameristar Casino St. Charles, LLC; Ameristar Casino Kansas City, LLC; PNK Vicksburg, LLC; Cactus Pete’s, LLC; Ameristar East Chicago Holdings, LLC; and Ameristar Casino East Chicago, LLC. In addition, certain other immaterial subsidiaries are also guarantors of our senior and senior subordinated notes. | ||
[2] | Guarantor subsidiaries of our senior and senior subordinated notes exclude subsidiaries with approximately $38.3 million in cash and other assets as of March 31, 2016, that include a subsidiary that owns a majority interest in the licensee of Retama Park Racetrack and certain other subsidiaries. |
Consolidating Condensed Finan50
Consolidating Condensed Financial Information - Statements of Cash Flows (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2016 | Mar. 31, 2015 | ||
Condensed Financial Statements | |||
Cash provided by (used in) operating activities | $ 85,468 | $ 113,097 | |
Capital expenditures | (21,884) | (21,118) | |
Net proceeds from disposition of asset held for sale | 325 | 0 | |
Loans receivable | (750) | (750) | |
Net cash used in investing activities | (22,309) | (21,574) | |
Proceeds from credit facility | 64,000 | 35,000 | |
Repayments under credit facility | (169,250) | (137,750) | |
Other | (841) | (252) | |
Net cash used in financing activities | (105,876) | (96,856) | |
Change in cash and cash equivalents | (42,717) | (5,333) | |
Cash and cash equivalents at the beginning of the period | 164,034 | 164,654 | |
Cash and cash equivalents at the end of the period | 121,317 | 159,321 | |
Pinnacle Entertainment, Inc. | |||
Condensed Financial Statements | |||
Cash provided by (used in) operating activities | (34,100) | 115,000 | |
Capital expenditures | (4,400) | (2,100) | |
Net proceeds from disposition of asset held for sale | 300 | ||
Loans receivable | 0 | ||
Net transfers to (from) affiliates | 145,100 | ||
Other | 0 | ||
Net cash used in investing activities | 141,000 | (2,100) | |
Proceeds from credit facility | 64,000 | 35,000 | |
Repayments under credit facility | (169,300) | (137,800) | |
Net transfers to (from) affiliates | 0 | ||
Other | (600) | 5,900 | |
Net cash used in financing activities | (105,900) | (96,900) | |
Change in cash and cash equivalents | 1,000 | 16,000 | |
Cash and cash equivalents at the beginning of the period | 1,500 | 6,400 | |
Cash and cash equivalents at the end of the period | 2,500 | 22,400 | |
100% Owned Guarantor Subsidiaries | |||
Condensed Financial Statements | |||
Cash provided by (used in) operating activities | [1] | 109,800 | (25,400) |
Capital expenditures | [1] | (17,500) | (19,000) |
Net proceeds from disposition of asset held for sale | [1] | 0 | |
Loans receivable | [1] | 0 | |
Net transfers to (from) affiliates | [1] | 0 | |
Other | [1] | 300 | |
Net cash used in investing activities | [1] | (17,500) | (18,700) |
Proceeds from credit facility | [1] | 0 | 0 |
Repayments under credit facility | [1] | 0 | 0 |
Net transfers to (from) affiliates | [1] | (142,000) | |
Other | [1] | 0 | 0 |
Net cash used in financing activities | [1] | (142,000) | 0 |
Change in cash and cash equivalents | [1] | (49,700) | (44,100) |
Cash and cash equivalents at the beginning of the period | [1] | 162,500 | 158,300 |
Cash and cash equivalents at the end of the period | [1] | 112,800 | 114,200 |
Non-Guarantor Subsidiaries | |||
Condensed Financial Statements | |||
Cash provided by (used in) operating activities | [2] | 9,800 | 23,500 |
Capital expenditures | [2] | 0 | 0 |
Net proceeds from disposition of asset held for sale | [2] | 0 | |
Loans receivable | [2] | (700) | |
Net transfers to (from) affiliates | [2] | 0 | |
Other | [2] | (800) | |
Net cash used in investing activities | [2] | (700) | (800) |
Proceeds from credit facility | [2] | 0 | 0 |
Repayments under credit facility | [2] | 0 | 0 |
Net transfers to (from) affiliates | [2] | (3,100) | |
Other | [2] | 0 | 0 |
Net cash used in financing activities | [2] | (3,100) | 0 |
Change in cash and cash equivalents | [2] | 6,000 | 22,700 |
Cash and cash equivalents at the beginning of the period | [2] | 0 | 0 |
Cash and cash equivalents at the end of the period | [2] | 6,000 | 22,700 |
Consolidating and Eliminating Entries | |||
Condensed Financial Statements | |||
Cash provided by (used in) operating activities | 0 | 0 | |
Capital expenditures | 0 | 0 | |
Net proceeds from disposition of asset held for sale | 0 | ||
Loans receivable | 0 | ||
Net transfers to (from) affiliates | (145,100) | ||
Other | 0 | ||
Net cash used in investing activities | (145,100) | 0 | |
Proceeds from credit facility | 0 | 0 | |
Repayments under credit facility | 0 | 0 | |
Net transfers to (from) affiliates | 145,100 | ||
Other | 0 | 0 | |
Net cash used in financing activities | 145,100 | 0 | |
Change in cash and cash equivalents | 0 | 0 | |
Cash and cash equivalents at the beginning of the period | 0 | 0 | |
Cash and cash equivalents at the end of the period | 0 | 0 | |
Pinnacle Entertainment, Inc. Consolidated | |||
Condensed Financial Statements | |||
Cash provided by (used in) operating activities | 85,500 | 113,100 | |
Capital expenditures | (21,900) | (21,100) | |
Net proceeds from disposition of asset held for sale | 300 | ||
Loans receivable | (700) | ||
Net transfers to (from) affiliates | 0 | ||
Other | (500) | ||
Net cash used in investing activities | (22,300) | (21,600) | |
Proceeds from credit facility | 64,000 | 35,000 | |
Repayments under credit facility | (169,300) | (137,800) | |
Net transfers to (from) affiliates | 0 | ||
Other | (600) | 5,900 | |
Net cash used in financing activities | (105,900) | (96,900) | |
Change in cash and cash equivalents | (42,700) | (5,400) | |
Cash and cash equivalents at the beginning of the period | 164,000 | 164,700 | |
Cash and cash equivalents at the end of the period | $ 121,300 | $ 159,300 | |
[1] | he following material subsidiaries are identified as guarantors of our senior and senior subordinated notes: Belterra Resort Indiana, LLC; Boomtown, LLC; Casino Magic, LLC; Louisiana-I Gaming; PNK (Baton Rouge) Partnership; PNK (BOSSIER CITY), LLC; PNK Development 7, LLC; PNK Development 8, LLC; PNK Development 9, LLC; PNK (LAKE CHARLES), L.L.C.; PNK (Ohio), LLC; PNK (Ohio) II, LLC; PNK (Ohio) III, LLC; PNK (River City), LLC; PNK (SAM), LLC; PNK (SAZ), LLC; Ameristar Casino Black Hawk, LLC; Ameristar Casino Council Bluffs, LLC; Ameristar Casino St. Charles, LLC; Ameristar Casino Kansas City, LLC; PNK Vicksburg, LLC; Cactus Pete’s, LLC; Ameristar East Chicago Holdings, LLC; and Ameristar Casino East Chicago, LLC. In addition, certain other immaterial subsidiaries are also guarantors of our senior and senior subordinated notes. | ||
[2] | Guarantor subsidiaries of our senior and senior subordinated notes exclude subsidiaries with approximately $38.3 million in cash and other assets as of March 31, 2016, that include a subsidiary that owns a majority interest in the licensee of Retama Park Racetrack and certain other subsidiaries. |
Segment Information Segment Inf
Segment Information Segment Information - Additional Details (Details) | 3 Months Ended |
Mar. 31, 2016propertysegment | |
Segment Reporting Information [Line Items] | |
Number of casinos owned and operated | property | 15 |
Number of reportable segments | segment | 3 |
Jackpot, Nevada | |
Segment Reporting Information [Line Items] | |
Number of casinos owned and operated | property | 2 |
Number of operating segments | segment | 1 |
Segment Information (Details)
Segment Information (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2016 | Mar. 31, 2015 | ||
Revenues: | |||
Revenues | $ 580,025 | $ 572,839 | |
Adjusted EBITDA [Abstract] | |||
Adjusted EBITDA | [1] | 172,400 | 169,700 |
Other costs: | |||
Depreciation and amortization | (54,096) | (67,831) | |
Pre-opening, development and other costs | (5,329) | (1,567) | |
Non-cash share-based compensation expense | (4,400) | (4,100) | |
Write-downs, reserves and recoveries, net | (2,890) | (3,144) | |
Interest expense, net | (59,793) | (61,083) | |
Loss from equity method investment | 0 | (83) | |
Income tax expense | (4,998) | (4,832) | |
Income from continuing operations | 40,893 | 27,079 | |
Capital expenditures | 21,884 | 21,118 | |
Midwest | |||
Revenues: | |||
Revenues | [2] | 328,600 | 313,900 |
Adjusted EBITDA [Abstract] | |||
Adjusted EBITDA | [1],[2] | 107,500 | 100,800 |
Other costs: | |||
Capital expenditures | [2] | 9,200 | 10,500 |
South | |||
Revenues: | |||
Revenues | [2] | 193,700 | 203,700 |
Adjusted EBITDA [Abstract] | |||
Adjusted EBITDA | [1],[2] | 64,600 | 67,500 |
Other costs: | |||
Capital expenditures | [2] | 7,100 | 7,200 |
West | |||
Revenues: | |||
Revenues | [2] | 56,500 | 53,700 |
Adjusted EBITDA [Abstract] | |||
Adjusted EBITDA | [1],[2] | 20,900 | 20,700 |
Other costs: | |||
Capital expenditures | [2] | 2,600 | 1,300 |
Operating Segments | |||
Revenues: | |||
Revenues | 578,800 | 571,300 | |
Adjusted EBITDA [Abstract] | |||
Adjusted EBITDA | [1] | 193,000 | 189,000 |
Corporate and Other | |||
Revenues: | |||
Revenues | [3] | 1,200 | 1,500 |
Adjusted EBITDA [Abstract] | |||
Adjusted EBITDA | [1],[3] | (20,600) | (19,300) |
Other costs: | |||
Capital expenditures | $ 3,000 | $ 2,100 | |
[1] | We define Consolidated Adjusted EBITDA as earnings before interest income and expense, income taxes, depreciation, amortization, pre-opening, development and other costs, non-cash share-based compensation, asset impairment costs, write-downs, reserves, recoveries, corporate-level litigation settlement costs, gain (loss) on sale of certain assets, loss on early extinguishment of debt, gain (loss) on sale of equity security investments, income (loss) from equity method investments, non-controlling interest and discontinued operations. We define Adjusted EBITDA for each reportable segment as earnings before interest income and expense, income taxes, depreciation, amortization, pre-opening, development and other costs, non-cash share-based compensation, asset impairment costs, write-downs, reserves, recoveries, inter-company management fees, gain (loss) on sale of certain assets, gain (loss) on early extinguishment of debt, gain (loss) on sale of discontinued operations, and discontinued operations. We define Adjusted EBITDA margin as Adjusted EBITDA for the segment divided by segment revenues. We use Consolidated Adjusted EBITDA and Adjusted EBITDA for each segment to compare operating results among our properties and between accounting periods. Consolidated Adjusted EBITDA and Adjusted EBITDA have economic substance because they are used by management as measures to analyze the performance of our business and are especially relevant in evaluating large, long-lived casino-hotel projects because they provide a perspective on the current effects of operating decisions separated from the substantial non-operational depreciation charges and financing costs of such projects. We eliminate the results from discontinued operations at the time they are deemed discontinued. We also review pre-opening, development and other costs separately, as such expenses are also included in total project costs when assessing budgets and project returns, and because such costs relate to anticipated future revenues and income. We believe that Consolidated Adjusted EBITDA and Adjusted EBITDA are useful measures for investors because they are indicators of the performance of ongoing business operations. These calculations are commonly used as a basis for investors, analysts and credit rating agencies to evaluate and compare operating performance and value of companies within our industry. In addition, our credit agreement and bond indentures require compliance with financial measures similar to Consolidated Adjusted EBITDA. Consolidated Adjusted EBITDA should not be considered as an alternative to operating income as an indicator of performance, or as an alternative to any other measure provided in accordance with GAAP. Our calculations of Adjusted EBITDA and Consolidated Adjusted EBITDA may be different from the calculation methods used by other companies and, therefore, comparability may be limited. | ||
[2] | See Note 1, “Organization and Summary of Significant Accounting Policies,” for listing of properties included in each segment. | ||
[3] | Corporate and other includes revenues from Retama Park Racetrack (which we manage) and the Heartland Poker Tour. Corporate expenses represent payroll, professional fees, travel expenses and other general and administrative expenses not directly related to our casino and hotel operations. Corporate expenses that are directly attributable to a property are allocated to each applicable property. All other costs incurred relating to the management and consulting services provided by corporate headquarters to the properties are allocated to those properties based on their respective share of the monthly consolidated net revenues in the form of a management fee. The corporate management fee is excluded in the calculation of segment Adjusted EBITDA and is completely eliminated in any consolidated financial results. |