Document and Entity Information
Document and Entity Information - shares | 6 Months Ended | |
Jun. 30, 2023 | Aug. 04, 2023 | |
Document and Entity Information [Abstract] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Jun. 30, 2023 | |
Document Transition Report | false | |
Entity File Number | 1-32583 | |
Entity Registrant Name | FULL HOUSE RESORTS INC | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 13-3391527 | |
Entity Address, Address Line One | One Summerlin, 1980 Festival Plaza Drive, Suite 680 | |
Entity Address, City or Town | Las Vegas | |
Entity Address, State or Province | NV | |
Entity Address, Postal Zip Code | 89135 | |
City Area Code | 702 | |
Local Phone Number | 221-7800 | |
Title of 12(b) Security | Common Stock, $0.0001 par value per share | |
Trading Symbol | FLL | |
Security Exchange Name | NASDAQ | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Accelerated Filer | |
Entity Emerging Growth Company | false | |
Entity Small Business | true | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 34,577,688 | |
Entity Central Index Key | 0000891482 | |
Current Fiscal Year End Date | --12-31 | |
Document Fiscal Year End | 2023 | |
Document Fiscal Period Focus | Q2 | |
Amendment Flag | false |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2023 | Jun. 30, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | |
Revenues | ||||
Net revenues | $ 59,382 | $ 44,383 | $ 109,488 | $ 85,806 |
Operating costs and expenses | ||||
Selling, general and administrative | 21,577 | 14,184 | 39,806 | 29,577 |
Project development costs | 17 | 17 | 24 | 182 |
Preopening costs | 1,086 | 1,534 | 11,583 | 2,320 |
Depreciation and amortization | 8,155 | 1,834 | 14,014 | 3,626 |
(Gain) loss on disposal of assets | (5) | 0 | 3 | |
Total operating costs and expenses | 58,788 | 36,164 | 115,880 | 72,284 |
Operating income (loss) | 594 | 8,219 | (6,392) | 13,522 |
Other (expense) income | ||||
Interest expense, net | (5,633) | (6,988) | (10,452) | (13,387) |
Loss on modification of debt | (19) | 0 | (4,425) | |
Gain on insurance settlement | 355 | 0 | ||
Total other expense | (5,633) | (7,007) | (10,097) | (17,812) |
(Loss) income before income taxes | (5,039) | 1,212 | (16,489) | (4,290) |
Income tax provision (benefit) | 561 | 5,567 | 526 | (45) |
Net loss | $ (5,600) | $ (4,355) | $ (17,015) | $ (4,245) |
Basic (loss) earnings per share (in dollars per share) | $ (0.16) | $ (0.13) | $ (0.49) | $ (0.12) |
Diluted (loss) earnings per share (in dollars per share) | $ (0.16) | $ (0.13) | $ (0.49) | $ (0.12) |
Casino | ||||
Revenues | ||||
Net revenues | $ 45,359 | $ 29,488 | $ 81,346 | $ 58,572 |
Operating costs and expenses | ||||
Costs and expenses | 16,990 | 10,106 | 30,334 | 19,981 |
Food and beverage | ||||
Revenues | ||||
Net revenues | 8,673 | 6,933 | 16,333 | 13,444 |
Operating costs and expenses | ||||
Costs and expenses | 9,030 | 6,752 | 16,485 | 13,320 |
Hotel | ||||
Revenues | ||||
Net revenues | 2,348 | 2,407 | 4,492 | 4,586 |
Operating costs and expenses | ||||
Costs and expenses | 1,228 | 1,197 | 2,447 | 2,268 |
Other operations, including contracted sports wagering | ||||
Revenues | ||||
Net revenues | 3,002 | 5,555 | 7,317 | 9,204 |
Operating costs and expenses | ||||
Costs and expenses | $ 705 | $ 545 | $ 1,187 | $ 1,007 |
CONSOLIDATED BALANCE SHEETS (Un
CONSOLIDATED BALANCE SHEETS (Unaudited) - USD ($) $ in Thousands | Jun. 30, 2023 | Dec. 31, 2022 |
Current assets | ||
Cash and equivalents | $ 35,501 | $ 56,589 |
Restricted cash | 78,078 | 134,587 |
Accounts receivable, net of reserves of $216 and $249 | 6,136 | 4,082 |
Inventories | 1,868 | 1,479 |
Prepaid expenses and other | 5,928 | 6,184 |
Total current assets | 127,511 | 202,921 |
Other long-term assets | ||
Property and equipment, net | 410,496 | 339,057 |
Operating lease right-of-use assets, net | 46,293 | 15,771 |
Finance lease right-of-use assets, net | 2,979 | 3,808 |
Goodwill | 21,286 | 21,286 |
Other intangible assets, net | 61,103 | 10,869 |
Deposits and other | 1,466 | 1,617 |
Total Assets | 671,134 | 595,329 |
Current liabilities | ||
Accounts payable | 6,459 | 4,602 |
Construction payable | 25,890 | 30,279 |
Accrued payroll and related | 3,247 | 3,784 |
Accrued interest | 13,867 | 12,966 |
Other accrued liabilities | 11,759 | 9,964 |
Current portion of operating lease obligations | 3,588 | 2,485 |
Current portion of finance lease obligation | 1,605 | 1,581 |
Total current liabilities | 66,415 | 65,661 |
Operating lease obligations, net of current portion | 42,902 | 13,418 |
Finance lease obligations, net of current portion | 3,756 | 4,727 |
Long-term debt, net | 463,654 | 401,852 |
Deferred income taxes, net | 1,550 | 1,024 |
Contract liabilities, net of current portion | 8,524 | 8,856 |
Total liabilities | 586,801 | 495,538 |
Commitments and contingencies (Note 6) | ||
Stockholders' equity | ||
Common stock, $0.0001 par value, 100,000,000 shares authorized; 35,302,549 and 35,302,549 shares issued and 34,577,688 and 34,407,654 shares outstanding | 4 | 4 |
Additional paid-in capital | 111,940 | 110,590 |
Treasury stock, 724,861 and 894,895 common shares | (884) | (1,091) |
Accumulated deficit | (26,727) | (9,712) |
Total stockholders' equity | 84,333 | 99,791 |
Total liabilities and stockholders' equity | $ 671,134 | $ 595,329 |
CONSOLIDATED BALANCE SHEETS (_2
CONSOLIDATED BALANCE SHEETS (Unaudited) (Parentheticals) - USD ($) $ in Thousands | Jun. 30, 2023 | Dec. 31, 2022 |
CONSOLIDATED BALANCE SHEETS (Unaudited) | ||
Accounts receivable reserves | $ 216 | $ 249 |
Common stock, par value (in dollars per share) | $ 0.0001 | $ 0.0001 |
Common stock, shares authorized (in shares) | 100,000,000 | 100,000,000 |
Common stock, shares issued (in shares) | 35,302,549 | 35,302,549 |
Common stock, shares outstanding (in shares) | 34,577,688 | 34,407,654 |
Treasury stock, common shares (in shares) | 724,861 | 894,895 |
CONSOLIDATED STATEMENTS OF STOC
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (Unaudited) - USD ($) shares in Thousands, $ in Thousands | Common Stock | Additional Paid-in Capital | Treasury Stock, Common [Member] | Retained Earnings (Accumulated Deficit) | Total |
Balance at Dec. 31, 2021 | $ 4 | $ 108,911 | $ (1,292) | $ 5,092 | $ 112,715 |
Balance (in shares) at Dec. 31, 2021 | 35,302 | 1,060 | |||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Options exercised and restricted stocks vested | 14 | $ 125 | 139 | ||
Options exercised and restricted stocks vested (in shares) | (103) | ||||
Stock-based compensation | 343 | 343 | |||
Net (loss) income | 110 | 110 | |||
Balance at Mar. 31, 2022 | $ 4 | 109,268 | $ (1,167) | 5,202 | 113,307 |
Balance (in shares) at Mar. 31, 2022 | 35,302 | 957 | |||
Balance at Dec. 31, 2021 | $ 4 | 108,911 | $ (1,292) | 5,092 | 112,715 |
Balance (in shares) at Dec. 31, 2021 | 35,302 | 1,060 | |||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Net (loss) income | (4,245) | ||||
Balance at Jun. 30, 2022 | $ 4 | 109,708 | $ (1,120) | 847 | 109,439 |
Balance (in shares) at Jun. 30, 2022 | 35,302 | 918 | |||
Balance at Mar. 31, 2022 | $ 4 | 109,268 | $ (1,167) | 5,202 | 113,307 |
Balance (in shares) at Mar. 31, 2022 | 35,302 | 957 | |||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Restricted stocks vested | (47) | $ 47 | |||
Restricted stocks vested, (in shares) | (39) | ||||
Stock-based compensation | 487 | 487 | |||
Net (loss) income | (4,355) | (4,355) | |||
Balance at Jun. 30, 2022 | $ 4 | 109,708 | $ (1,120) | 847 | 109,439 |
Balance (in shares) at Jun. 30, 2022 | 35,302 | 918 | |||
Balance at Dec. 31, 2022 | $ 4 | 110,590 | $ (1,091) | (9,712) | 99,791 |
Balance (in shares) at Dec. 31, 2022 | 35,302 | 895 | |||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Options exercised | 12 | $ 5 | 17 | ||
Options exercised (in shares) | (4) | ||||
Stock-based compensation | 748 | 748 | |||
Net (loss) income | (11,415) | (11,415) | |||
Balance at Mar. 31, 2023 | $ 4 | 111,350 | $ (1,086) | (21,127) | 89,141 |
Balance (in shares) at Mar. 31, 2023 | 35,302 | 891 | |||
Balance at Dec. 31, 2022 | $ 4 | 110,590 | $ (1,091) | (9,712) | 99,791 |
Balance (in shares) at Dec. 31, 2022 | 35,302 | 895 | |||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Net (loss) income | (17,015) | ||||
Balance at Jun. 30, 2023 | $ 4 | 111,940 | $ (884) | (26,727) | 84,333 |
Balance (in shares) at Jun. 30, 2023 | 35,302 | 725 | |||
Balance at Mar. 31, 2023 | $ 4 | 111,350 | $ (1,086) | (21,127) | 89,141 |
Balance (in shares) at Mar. 31, 2023 | 35,302 | 891 | |||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Options exercised and restricted stocks vested | (65) | $ 202 | 137 | ||
Options exercised and restricted stocks vested (in shares) | (166) | ||||
Stock-based compensation | 655 | 655 | |||
Net (loss) income | (5,600) | (5,600) | |||
Balance at Jun. 30, 2023 | $ 4 | $ 111,940 | $ (884) | $ (26,727) | $ 84,333 |
Balance (in shares) at Jun. 30, 2023 | 35,302 | 725 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2023 | Jun. 30, 2022 | |
Cash flows from operating activities: | ||
Net loss | $ (17,015) | $ (4,245) |
Adjustments to reconcile net loss to net cash (used in) provided by operating activities: | ||
Depreciation and amortization | 14,014 | 3,626 |
Amortization of debt issuance costs, discounts and premiums | 1,291 | 797 |
Non-cash change in ROU operating lease assets | 1,997 | 1,648 |
Stock-based compensation | 1,403 | 830 |
Loss on disposal of assets | 0 | 3 |
Gain on insurance settlement | (355) | 0 |
Loss on modification of debt | 0 | 4,425 |
Other operating activities | 773 | 0 |
Deferred income taxes | 526 | (45) |
Increases and decreases in operating assets and liabilities: | ||
Accounts receivable | (2,054) | (4,196) |
Prepaid expenses, inventories and other | (133) | (1,309) |
Operating lease liabilities | (1,933) | (1,747) |
Contract liabilities | 18 | 3,238 |
Accounts payable and other liabilities | 3,170 | 1,163 |
Net cash (used in) provided by operating activities | 1,702 | 4,188 |
Cash flows from investing activities: | ||
Capital expenditures | (89,309) | (64,061) |
Proceeds from insurance settlement related to property damage | 355 | 0 |
Acquisition of intangible assets | (50,250) | 0 |
Other | 0 | (965) |
Net cash used in investing activities | (139,204) | (65,026) |
Cash flows from financing activities: | ||
Proceeds from Senior Secured Notes due 2028 borrowings | 40,000 | 100,000 |
Proceeds from premium on Senior Secured Notes due 2028 borrowings | 0 | 2,000 |
Payment of debt discount and issuance costs | (6,490) | (7,841) |
Borrowings under revolving credit facility | 36,000 | 0 |
Repayment of revolving credit facility borrowings | (9,000) | 0 |
Repayment of finance lease obligations | (759) | (254) |
Proceeds from exercise of stock options | 154 | 139 |
Other | 0 | (108) |
Net cash provided by financing activities | 59,905 | 93,936 |
Net (decrease) increase in cash, cash equivalents and restricted cash | (77,597) | 33,098 |
Cash, cash equivalents and restricted cash, beginning of period | 191,176 | 265,293 |
Cash, cash equivalents and restricted cash, end of period | 113,579 | 298,391 |
Supplemental Cash Flow Disclosure: | ||
Cash paid for interest, net of amounts capitalized | 10,721 | 13,745 |
Supplemental Schedule of Non-Cash Investing and Financing Activities: | ||
Accounts payable related capital expenditures | 25,949 | 12,089 |
Right-of-use assets obtained in exchange for operating lease liabilities | 30,178 | $ 264 |
Operating lease right-of-use asset and liability remeasurements | 2,341 | |
Financing leases Right-of-use asset and liability remeasurements | $ (207) |
ORGANIZATION
ORGANIZATION | 6 Months Ended |
Jun. 30, 2023 | |
ORGANIZATION | |
ORGANIZATION | 1. ORGANIZATION Organization. The Company currently operates six casinos: five on real estate that we own or lease and one located within a hotel owned by a third party. We are currently constructing our seventh property, Chamonix Casino Hotel (“Chamonix”), adjacent to our existing Bronco Billy’s Casino and Hotel in Cripple Creek, Colorado. We are also designing our permanent American Place casino destination, which will be built adjacent to a temporary facility that we opened in February 2023, named The Temporary by American Place (“The Temporary”). We intend to operate The Temporary until the opening of the permanent American Place facility. Additionally, we benefit from seven permitted sports wagering “skins” – three in Colorado, three in Indiana, and one in Illinois. Other companies operate or will operate these online sports wagering websites under their brands, paying us a percentage of revenues, as defined, subject to annual minimum amounts. Starting in the first quarter of 2023, the Company updated its reportable segments to Midwest & South, West, and Contracted Sports Wagering. This change reflects a realignment within the Company as a result of our continued growth. See Note 9 The following table presents selected information concerning our segments: Segments and Properties Locations Midwest & South The Temporary by American Place (opened on February 17, 2023) Waukegan, IL Silver Slipper Casino and Hotel Hancock County, MS (near New Orleans) Rising Star Casino Resort Rising Sun, IN (near Cincinnati) West Bronco Billy’s Casino and Hotel Cripple Creek, CO (near Colorado Springs) Chamonix Casino Hotel (scheduled to open December 26, 2023) Cripple Creek, CO (near Colorado Springs) Grand Lodge Casino Incline Village, NV Stockman’s Casino Fallon, NV (one hour east of Reno) Contracted Sports Wagering Three sports wagering websites (“skins”) Colorado Three sports wagering websites (“skins”), one of which is currently idle Indiana One sports wagering website (“skin”), commencing in August 2023 Illinois |
BASIS OF PRESENTATION AND SIGNI
BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES | 6 Months Ended |
Jun. 30, 2023 | |
BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES | |
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 2. BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES Basis of Presentation. The interim consolidated financial statements of the Company included herein reflect all adjustments (consisting of normal recurring adjustments) that are, in the opinion of management, necessary to present fairly the financial position and results of operations for the interim periods presented. The results of operations for the interim periods are not necessarily indicative of annualized results for an entire year. The consolidated financial statements include the accounts of Full House and its wholly-owned subsidiaries. All intercompany accounts and transactions have been eliminated in consolidation. Fair Value and the Fair Value Input Hierarchy. GAAP categorizes the inputs used for fair value into a three-level hierarchy: ● Level 1: Observable inputs, such as quoted prices in active markets for identical assets or liabilities; ● Level 2: Comparable inputs other than quoted prices that are observable for similar assets or liabilities in less active markets; and ● Level 3: Unobservable inputs which may include metrics that market participants would use to estimate values, such as revenue and earnings multiples and relative rates of return. Methods and assumptions used to estimate the fair value of financial instruments are affected by the duration of the instruments and other factors used by market participants to estimate value. The carrying amounts for cash and equivalents, restricted cash, accounts receivable, and accounts payable approximate their estimated fair value because of the short durations of the instruments and inconsequential rates of interest. Cash Equivalents and Restricted Cash. Restricted cash balances consist of funds placed into a construction reserve, interest-bearing account to fund the completion of the Chamonix construction project, in accordance with the Company’s debt covenants. Accounts Receivable. In March 2023, Rising Star sold its available “free play” for $2.1 million. We received all of such amount in July 2023. Because Indiana has a progressive gaming tax system and Rising Star is one of the smaller casinos in the state, the property has consistently sold its ability to deduct “free play” in computing gaming taxes to operators in higher tax tiers. It sold such “free play” in the second quarter of 2022 for a similar amount. Other Intangible Assets. In March 2023, the Company paid $50.3 million to the Illinois Gaming Board (“IGB”) for required gaming license fees to operate The Temporary, and upon its opening, American Place. Management has deemed the gaming license in Illinois as having an indefinite economic life, as such license is eligible for renewal every four years if all regulatory requirements are met. There may be an additional one-time reconciliation fee, depending on interim gaming revenues, which is calculated three years after commencing operations and can be paid over a six-year period. See Note 6 for details. Revenue Recognition: Accrued Club Points and Customer Loyalty Programs: Operating Revenues and Related Costs and Expenses. The transaction price for a casino wager is the difference between gaming wins and losses, not the total amount wagered. As such wagers have similar characteristics, the Company accounts for its gaming transactions on a portfolio basis by recognizing net win per gaming day versus on an individual basis. The Company sometimes provides discretionary complimentary goods and services (“discretionary comps”). For these types of transactions, the Company allocates revenue to the department providing the complimentary goods or services based upon its estimated standalone selling price, offset by a reduction in casino revenues. Many of the Company’s casino customers choose to earn points under its customer loyalty programs. As points are accrued, the Company defers a portion of its casino revenue based on the estimated standalone value of loyalty points being earned by the customer. The standalone value of loyalty points is derived from the retail value of food, beverages, hotel rooms, and other goods or services for which such points may be redeemed. A liability related to these customer loyalty points is recorded, net of estimated breakage and other factors, until the customer redeems these points for various loyalty program benefits, primarily for “free casino play,” complimentary dining, or hotel stays, among others, depending on each property’s specific offers. Upon redemption, the related revenue is recognized at retail value within the department providing the goods or services. Unredeemed points are forfeited if the customer becomes and remains inactive for a specified period of time. Such liabilities were approximately $0.7 million for each of June 30, 2023 and December 31, 2022, and these amounts are included in “other accrued liabilities” on the consolidated balance sheets. Revenue for food and beverage, hotel, and other revenue transactions is typically the net amount collected from customers for such goods and services, plus the retail value of (i) discretionary comps and (ii) comps provided in return for redemption of loyalty points. The Company records such revenue as the good or service is transferred to the customer. Additionally, the Company may collect deposits in advance for future hotel reservations or entertainment, among other services, which represent obligations of the Company until the service is provided to the customer. Deferred Revenues: Market Access Fees from Sports Wagering Agreements. Indiana. Colorado. Illinois. In addition to the “market access” fees, deferred revenue includes quarterly and annual prepayments of contracted revenue, as required in three of the Sports Agreements. As of June 30, 2023, $1.3 million of such deferred revenue has been recognized during the year. Deferred revenues consisted of the following, as discussed above: (In thousands) June 30, December 31, Balance Sheet Location 2023 2022 Deferred revenue, current Other accrued liabilities $ 2,000 $ 1,651 Deferred revenue, net of current portion Contract liabilities, net of current portion 8,524 8,856 $ 10,524 $ 10,507 Other Revenues. Revenue by Source. Note 9 Income Taxes. Reclassifications. Earnings (Loss) Per Share. Leases. For material leases with terms greater than a year, the Company records right-of-use (“ROU”) assets and lease liabilities on the balance sheet, as measured on a discounted basis. For finance leases, the Company recognizes interest expense associated with the lease liability, as well as depreciation (or amortization) expense associated with the ROU asset, depending on whether those ROU assets are expected to transfer to the Company upon lease expiration. If ownership of a finance lease ROU asset is expected to transfer to the Company upon lease expiration, then it is included with the Company’s property and equipment; other qualifying finance lease ROU assets, based on other classifying criteria under Accounting Standards Codification 842 (“ASC 842”), are disclosed separately as “Finance Lease Right-of-Use Assets, Net.” For operating leases, the Company recognizes straight-line rent expense. The Company does not recognize ROU assets or lease liabilities for leases with a term of 12 months or less. However, costs related to short-term leases with terms greater than one month, which the Company deems material, are disclosed as a component of lease expenses when applicable. Additionally, the Company accounts for new and existing leases containing both lease and non-lease components (“embedded leases”) together as a single lease component Finance and operating lease ROU assets and liabilities are recognized based on the present value of future minimum lease payments over the expected lease term at commencement, plus any qualifying initial direct costs paid prior to commencement for ROU assets. As the implicit rate is not determinable in most of the Company’s leases, management uses the Company’s incremental borrowing rate as estimated by third-party valuation specialists in determining the present value of future payments based on the information available at the commencement date and/or modification date. The expected lease terms include options to extend or terminate the lease when it is reasonably certain that the Company will exercise such options. Lease expense for minimum lease payments is recognized on a straight-line basis over the expected lease term for operating leases. For finance leases, the ROU asset depreciates/amortizes on a straight-line basis over the shorter of the lease term or useful life of the ROU asset as applicable, and the lease liability accretes interest based on the interest method using the discount rate determined at lease commencement. Preopening costs. Debt Issuance Costs and Debt Discounts/Premiums. Recently Issued Accounting Pronouncements Not Yet Adopted. |
LEASES
LEASES | 6 Months Ended |
Jun. 30, 2023 | |
LEASES | |
LEASES | 3. LEASES The Company has no material leases in which it is the lessor. As lessee, the Company has finance leases for a hotel and certain equipment and operating leases for land, casino and office space, equipment, and buildings. The Company’s remaining lease terms, including extensions, range from one month to approximately 99 years. The Company’s lease agreements do not contain any material residual value guarantees or material restrictive covenants, but the land leases at Silver Slipper and The Temporary/American Place do include contingent rent, as further discussed below. Operating Leases Waukegan Ground Lease through February 2122 and Option to Purchase. The Company has the right to purchase the City-Owned Parcel at any time during the term of the Ground Lease for $30 million. If it does so prior to the opening of the permanent American Place facility, then it must continue to pay rent due to the City under the Ground Lease until the permanent casino is open. Silver Slipper Casino Land Lease through April 2058 and Option to Purchase. Through October 1, 2027, the Company may buy out the lease for $15.5 million, plus a seller-retained interest in Silver Slipper Casino and Hotel’s operations of 3% of net income (as defined) for 10 years following the purchase date. Bronco Billy’s / Chamonix Lease through January 2035 and Option to Purchase. three-year Grand Lodge Casino Lease through December 2024. Note 4 The current annual rent of $2.0 million is applicable through the remaining lease term. In February 2023, the lease was amended to extend the current term through December 31, 2024 (with no changes to rent). Accordingly, the Company remeasured this lease’s related ROU asset and liability balances on its balance sheet upon the effective date of the amendment. Corporate Office Lease through January 2025. Finance Lease Rising Star Casino Hotel Lease through October 2027 and Option to Purchase. The components of lease expenses are as follows: (In thousands) Three Months Ended Six Months Ended Classification within June 30, June 30, Lease Costs Statement of Operations 2023 2022 2023 2022 Operating leases: Fixed/base rent Selling, General and Administrative Expenses $ 2,170 $ 1,172 $ 3,962 $ 2,337 Short-term payments Selling, General and Administrative Expenses — 33 22 70 Variable payments Selling, General and Administrative Expenses 349 352 654 738 Finance leases: Amortization of leased assets Depreciation and Amortization 348 39 701 78 Interest on lease liabilities Interest Expense, Net 109 35 220 72 Total lease costs $ 2,976 $ 1,631 $ 5,559 $ 3,295 Leases recorded on the balance sheet consist of the following: (In thousands) June 30, December 31, Leases Balance Sheet Classification 2023 2022 Assets Operating lease assets Operating Lease Right-of-Use Assets, Net $ 46,293 $ 15,771 Finance lease assets Property and Equipment, Net (1) 4,487 4,566 Finance lease assets Finance Lease Right-of-Use Assets, Net (2) 2,979 3,808 Total lease assets $ 53,759 $ 24,145 Liabilities Current Operating Current Portion of Operating Lease Obligations $ 3,588 $ 2,485 Finance Current Portion of Finance Lease Obligation 1,605 1,581 Noncurrent Operating Operating Lease Obligations, Net of Current Portion 42,902 13,418 Finance Finance Lease Obligation, Net of Current Portion 3,756 4,727 Total lease liabilities $ 51,851 $ 22,211 __________ (1) Finance lease assets are recorded net of accumulated amortization of $3.2 million for each of June 30, 2023 and December 31, 2022. (2) These finance lease assets are recorded separately from Property and Equipment due to meeting qualifying classification criteria under ASC 842, but ownership of such assets is not expected to transfer to the Company upon term expiration. Additionally, amortization of these assets are expensed over the duration of the lease term or the assets’ estimated useful lives, whichever is earlier. Maturities of lease liabilities as of June 30, 2023 are summarized as follows: (In thousands) Operating Financing Years Ending December 31, Leases Leases 2023 (excluding the six months ended June 30, 2023) $ 3,848 $ 979 2024 7,735 1,957 2025 5,722 1,939 2026 4,864 652 2027 4,515 489 Thereafter 316,582 — Total future minimum lease payments 343,266 6,016 Less: Amount representing interest (296,776) (655) Present value of lease liabilities 46,490 5,361 Less: Current lease obligations (3,588) (1,605) Long-term lease obligations $ 42,902 $ 3,756 Other information related to lease term and discount rate is as follows: June 30, December 31, Lease Term and Discount Rate 2023 2022 Weighted-average remaining lease term Operating leases 66.3 years 23.2 years Finance lease 3.3 years 3.7 years Weighted-average discount rate Operating leases 10.89 % 9.73 % Finance leases 7.74 % 7.08 % Supplemental cash flow information related to leases is as follows: (In thousands) Six Months Ended June 30, Cash paid for amounts included in the measurement of lease liabilities: 2023 2022 Operating cash flows for operating leases $ 3,898 $ 2,436 Operating cash flows for finance leases $ 220 $ 72 Financing cash flows for finance leases $ 759 $ 254 |
LONG-TERM DEBT
LONG-TERM DEBT | 6 Months Ended |
Jun. 30, 2023 | |
LONG-TERM DEBT. | |
LONG-TERM DEBT | 4 . LONG-TERM DEBT Long-term debt consists of the following: (In thousands) June 30, December 31, 2023 2022 Revolving Credit Facility due 2026 $ 27,000 $ — 8.25% Senior Secured Notes due 2028 450,000 410,000 Less: Unamortized debt issuance costs and discounts/premiums, net (13,346) (8,148) $ 463,654 $ 401,852 Senior Secured Notes due 2028. On February 7, 2022, the Company closed a private offering for an additional $100.0 million of Senior Secured Notes due 2028, which sold at a price of 102.0% of such principal amount. Proceeds from this sale were used: (i) to develop, equip and open The Temporary, which the Company intends to operate while it designs and constructs its permanent American Place facility, (ii) to pay the transaction fees and expenses of such offer and sale, and (iii) for general corporate purposes. The additional notes from this sale were issued pursuant to the indenture, dated as of February 12, 2021 (the “Original Indenture”), to which the Company issued the $310.0 million of 2028 Notes described above. In connection with the issuance of the additional notes in February 2022, the Company and the subsidiary guarantors party to the Original Indenture also entered into three Supplemental Indentures with Wilmington Trust, National Association, as trustee. On February 21, 2023, the Company issued an additional $40.0 million of senior secured notes (the “Additional Notes”), thereby increasing the outstanding borrowing under the 2028 Notes to $450.0 million (collectively, the “Notes”). Related to the issuance of the Additional Notes, the Company further amended the indenture governing the Notes (collectively, the “Amended Indenture”) and amended its revolving credit facility. Proceeds from the offering of the Additional Notes, net of related expenses and discounts, were approximately $34 million and were used: (i) to open The Temporary, including the payment of related Illinois gaming license fees in March 2023, and (ii) for general corporate purposes. The Additional Notes are essentially identical to the 2028 Notes, as they are treated as a single series of senior secured debt securities with the 2028 Notes and also as a single class for all purposes under the Amended Indenture, including, without limitation, waivers, amendments, redemptions and offers to purchase. The Notes bear interest at a fixed rate of 8.25% per year and mature on February 15, 2028. There is no mandatory debt amortization prior to the maturity date. Interest on the Notes is payable on February 15 and August 15 of each year. The Notes are guaranteed, jointly and severally (such guarantees, the “Guarantees”), by each of the Company’s restricted subsidiaries (collectively, the “Guarantors”). The Notes and the Guarantees are the Company’s and the Guarantors’ general senior secured obligations, subject to the terms of the Collateral Trust Agreement (as defined in the Amended Indenture), ranking senior in right of payment to all of the Company’s and the Guarantors’ existing and future debt that is expressly subordinated in right of payment to the Notes and the Guarantees, if any. The Notes and the Guarantees will rank equally in right of payment with all of the Company’s and the Guarantors’ existing and future senior debt. The Notes contain representations and warranties, covenants, and restrictions on dividends customary for notes of this type. Mandatory prepayments, in whole or in part, of the Notes will be required upon the occurrence of certain events, including sales of certain assets (unless such net proceeds are reinvested in the business), upon certain changes of control, or should the Company have certain unused funds in the construction disbursement account following the completion of Chamonix. On or prior to February 15, 2024, the Company may redeem up to 35% of the original principal amount of the Notes with proceeds of certain equity offerings at a redemption price of 108.25%, plus accrued and unpaid interest to the redemption date. In addition, the Company may redeem some or all of the Notes prior to February 15, 2024 at a redemption price of 100% of the principal amount of the Notes, plus accrued and unpaid interest to the redemption date and a “make-whole” premium. At any time on or after February 15, 2024, the Company may redeem some or all of the Notes for cash at the following redemption prices: Redemption Periods Percentage Premium February 15, 2024 to February 14, 2025 104.125 % February 15, 2025 to February 14, 2026 102.063 % February 15, 2026 and Thereafter 100.000 % Revolving Credit Facility due 2026. On February 21, 2023, the Company entered into a Second Amendment to Credit Agreement with Capital One, which, among other things, increased the amount of additional indebtedness permitted under the Company’s Credit Agreement from $25.0 million to $40.0 million (collectively, the “Credit Facility”). Such amendment permitted the issuance of the Additional Notes, as described above. The interest rate per annum applicable to loans under the Credit Facility is currently, at the Company’s option, either (i) the Secured Overnight Financing Rate (“SOFR”) plus a margin equal to 3.50% and a Term SOFR adjustment of 0.15%, or (ii) a base rate plus a margin equal to 2.50%. Upon completion of Chamonix (as defined in the agreement), the interest rate per annum applicable to loans under the Credit Facility will be reduced to, at the Company’s option, either (i) SOFR plus a margin equal to 3.00% and a Term SOFR adjustment of 0.15%, or (ii) a base rate plus a margin equal to 2.00%. The Credit Facility is equally and ratably secured by the same assets and guarantees securing the Notes. The Company may make prepayments of any amounts outstanding under the Credit Facility (without any reduction of the revolving commitments) in whole or in part at any time without penalty. The Credit Facility contains a number of negative covenants that, subject to certain exceptions, are substantially similar to the covenants contained in the Notes. The Credit Facility also requires compliance with a financial covenant as of the last day of each fiscal quarter, such that Adjusted EBITDA (as defined) for the trailing 12-month period must equal or exceed the utilized portion of the Credit Facility, if drawn. As of June 30, 2023, the Company was in compliance with this financial covenant and $27.0 million of borrowings remain outstanding under the Credit Facility. Fair Value of Long-Term Debt. |
INCOME TAXES
INCOME TAXES | 6 Months Ended |
Jun. 30, 2023 | |
INCOME TAXES | |
INCOME TAXES | 5. INCOME TAXES The Company’s effective income tax rates for the three and six months ended June 30, 2023 were (11.1%) and (3.2%), respectively, compared to effective income tax rates of 459.3% and 1.0% for the corresponding prior-year periods. The changes in the effective income tax rates were primarily due to the Company’s projections for pre-tax book income in 2023, the effects of tax amortization on indefinite-lived intangibles in 2023 and valuation allowances. The Company’s income tax provision or benefit for interim periods has been determined using an estimate of its annual effective tax rate (“AETR”), adjusted for discrete items. The Company continues to assess the realizability of deferred tax assets (“DTAs”) and concluded that it has not met the “more likely than not” threshold. As of June 30, 2023, the Company continues to provide a valuation allowance against its DTAs that cannot be offset by existing deferred tax liabilities. In accordance with Accounting Standards Codification 740 (“ASC 740”), this assessment has taken into consideration the jurisdictions in which these DTAs reside. |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 6 Months Ended |
Jun. 30, 2023 | |
COMMITMENTS AND CONTINGENCIES. | |
COMMITMENTS AND CONTINGENCIES. | 6. COMMITMENTS AND CONTINGENCIES Litigation The Company is party to a number of pending legal proceedings related to matters that occurred in the normal course of business. Management does not expect that the outcome of any such proceedings, either individually or in the aggregate, will have a material effect on the Company’s financial position, results of operations and cash flows. Contracted Sports Wagering in Illinois In May 2022, the Company entered into an agreement with an affiliate of Circa Sports to jointly develop and manage on-site sportsbooks at both The Temporary and American Place casinos in Illinois. In addition to the on-site sportsbook, Circa Sports will utilize the Company’s expected mobile sports skin to conduct Internet sports wagering throughout Illinois. In exchange for such rights, the Company received a non-refundable market access fee of $5 million in May 2022, which was recorded as a long-term liability under deferred revenues. The Company will also receive a percentage of revenues (as defined), subject to a minimum of $5 million per year, once Circa Sports launches operations in Illinois. Such launch is contingent upon receipt of customary regulatory approvals. Under the agreement, the Company will begin to receive revenue payments for its Illinois sports skin in August 2023, irrespective of whether its sports wagering operations have begun. The term of the agreement is for eight years, followed by two four-year Contingent Gaming License Fees in Illinois As required for its gaming licensure at The Temporary/American Place, the Company may be required to make a “Reconciliation Payment” to the State of Illinois. The Reconciliation Payment is calculated three years after the commencement of gaming operations in Illinois in an amount equal to 75% of the adjusted gross receipts for the most lucrative trailing 12-month period six years |
EARNINGS (LOSS) PER SHARE
EARNINGS (LOSS) PER SHARE | 6 Months Ended |
Jun. 30, 2023 | |
EARNINGS (LOSS) PER SHARE | |
EARNINGS (LOSS) PER SHARE | 7. EARNINGS (LOSS) PER SHARE The table below reconciles basic and diluted loss per share of common stock: (In thousands) Three Months Ended Six Months Ended June 30, June 30, 2023 2022 2023 2022 Numerator: Net loss ─ basic $ (5,600) $ (4,355) $ (17,015) $ (4,245) Net loss ─ diluted $ (5,600) $ (4,355) $ (17,015) $ (4,245) Denominator: Weighted-average common shares ─ basic 34,496 34,364 34,453 34,313 Potential dilution from share-based awards — 52 — 45 Weighted-average common and common share equivalents ─ diluted 34,496 34,416 34,453 34,358 Anti-dilutive share-based awards excluded from the calculation of diluted loss per share 4,079 3,477 3,962 1,944 |
SHARE-BASED COMPENSATION
SHARE-BASED COMPENSATION | 6 Months Ended |
Jun. 30, 2023 | |
STOCK-BASED COMPENSATION | |
STOCK-BASED COMPENSATION | 8. SHARE-BASED COMPENSATION Performance-Based Shares. one one In April 2023, the Compensation Committee approved the satisfaction of certain performance criteria related to our operations in 2022. Such performance measures involved multi-year growth rates for EBITDA and free cash flow per share. As a result, a total of 73,885 shares were approved to vest upon the later of (a) such approval by the Compensation Committee or (b) the anniversary date of their grant. During the second quarter of 2023, a total of 64,223 shares vested, with the remainder expected to vest in the following quarter. Restricted Stock Awards. As of June 30, 2023, the Company had 671,041 share-based awards authorized by shareholders and available for grant from the Company’s 2015 Equity Incentive Plan. The following table summarizes information related to the Company’s common stock options as of June 30, 2023: Weighted Number Average of Stock Exercise Options Price Options outstanding at January 1, 2023 3,503,235 $ 2.80 Granted 350,754 7.40 Exercised (53,962) 1.38 Canceled/Forfeited (20,000) 6.88 Expired (20,000) 3.22 Options outstanding at June 30, 2023 3,760,027 $ 3.22 Options exercisable at June 30, 2023 3,039,335 $ 2.23 Components of compensation expense are as follows: (In thousands) Three Months Ended Six Months Ended June 30, June 30, Compensation Expense 2023 2022 2023 2022 Stock options $ 372 $ 302 $ 702 $ 520 Restricted and performance-based shares 283 185 701 310 $ 655 $ 487 $ 1,403 $ 830 As of June 30, 2023, there was approximately $2.9 million of unrecognized compensation cost related to unvested stock options previously granted that is expected to be recognized over a weighted-average period of approximately 2.2 years. As of such date, there was also $2.0 million of unrecognized compensation cost related to unvested restricted and performance-based shares, which is expected to be recognized over a weighted-average period of 1.4 years. |
SEGMENT REPORTING AND DISAGGREG
SEGMENT REPORTING AND DISAGGREGATED REVENUE | 6 Months Ended |
Jun. 30, 2023 | |
SEGMENT REPORTING AND DISAGGREGATED REVENUE | |
SEGMENT REPORTING AND DISAGGREGATED REVENUE | 9. SEGMENT REPORTING AND DISAGGREGATED REVENUE The Company manages its reporting segments based on geographic regions within the United States and type of income. Starting in the first quarter of 2023, the Company changed its reportable segments to Midwest & South, West, and Contracted Sports Wagering. This change reflects a realignment within the Company as a result of its continued growth. The Company’s management views the regions where each of its casino resorts are located as reportable segments, in addition to its contracted sports wagering segment. Reportable segments are aggregated based on geography, economic characteristics, types of customers, types of services and products provided, the regulatory environments in which they operate, and their management and reporting structure. The Company utilizes Adjusted Segment EBITDA as the measure of segment profit in assessing performance and allocating resources at the reportable segment level. Adjusted Segment EBITDA is defined as earnings before interest and other non-operating income (expense), taxes, depreciation and amortization, preopening expenses, impairment charges, asset write-offs, recoveries, gain (loss) from asset disposals, project development and acquisition costs, non-cash share-based compensation expense, and corporate-related costs and expenses that are not allocated to each segment. As a result of the change in reportable segments described above, the Company has recast previously-reported segment information to conform to the current presentation in the following tables: (In thousands) Three Months Ended June 30, 2023 Contracted Sports Midwest & South West Wagering Total Revenues Casino $ 38,281 $ 7,078 $ — $ 45,359 Food and beverage 7,894 779 — 8,673 Hotel 2,229 119 — 2,348 Other operations, including 1,507 113 1,382 3,002 $ 49,911 $ 8,089 $ 1,382 $ 59,382 Adjusted Segment EBITDA $ 9,391 $ 177 $ 1,361 $ 10,929 Other operating costs and expenses: Depreciation and amortization (8,155) Corporate expenses (422) Project development costs (17) Preopening costs (1,086) Stock-based compensation (655) Operating income 594 Other expense: Interest expense, net (5,633) (5,633) Loss before income taxes (5,039) Income tax provision 561 Net loss $ (5,600) (In thousands) Three Months Ended June 30, 2022 Contracted Sports Midwest & South West Wagering Total Revenues Casino $ 21,197 $ 8,291 $ — $ 29,488 Food and beverage 6,236 697 — 6,933 Hotel 2,262 145 — 2,407 Other operations, 3,241 145 2,169 5,555 $ 32,936 $ 9,278 $ 2,169 $ 44,383 Adjusted Segment EBITDA $ 9,149 $ 1,684 $ 2,196 $ 13,029 Other operating costs and expenses: Depreciation and amortization (1,834) Corporate expenses (943) Project development costs (17) Preopening costs (1,534) Gain on disposal of assets 5 Stock-based compensation (487) Operating income 8,219 Other expenses: Interest expense, net (6,988) Loss on modification of debt (19) Income before income taxes 1,212 Income tax provision 5,567 Net loss $ (4,355) (In thousands) Six Months Ended June 30, 2023 Contracted Sports Midwest & South West Wagering Total Revenues Casino $ 67,133 $ 14,213 $ — $ 81,346 Food and beverage 14,791 1,542 — 16,333 Hotel 4,269 223 — 4,492 Other operations, 4,520 235 2,562 7,317 $ 90,713 $ 16,213 $ 2,562 $ 109,488 Adjusted Segment EBITDA $ 20,077 $ 234 $ 2,522 $ 22,833 Other operating costs and expenses: Depreciation and amortization (14,014) Corporate expenses (2,201) Project development costs (24) Preopening costs (11,583) Stock-based compensation (1,403) Operating loss (6,392) Other (expense) income: Interest expense, net (10,452) Gain on insurance settlement 355 (10,097) Loss before income taxes (16,489) Income tax provision 526 Net loss $ (17,015) (In thousands) Six Months Ended June 30, 2022 Contracted Sports Midwest & South West Wagering Total Revenues Casino $ 42,595 $ 15,977 $ — $ 58,572 Food and beverage 12,048 1,396 — 13,444 Hotel 4,305 281 — 4,586 Other operations, 3,934 270 5,000 9,204 $ 62,882 $ 17,924 $ 5,000 $ 85,806 Adjusted Segment EBITDA $ 16,239 $ 2,191 $ 4,964 $ 23,394 Other operating costs and expenses: Depreciation and amortization (3,626) Corporate expenses (2,911) Project development costs (182) Preopening costs (2,320) Loss on disposal of assets (3) Stock-based compensation (830) Operating income 13,522 Other expenses: Interest expense, net (13,387) Loss on modification of debt (4,425) (17,812) Loss before income taxes (4,290) Income tax benefit (45) Net loss $ (4,245) (In thousands) June 30, December 31, 2023 2022 Total Assets Midwest & South $ 297,499 $ 194,033 West 352,554 351,069 Contracted Sports Wagering 1,658 1,658 Corporate and Other 19,423 48,569 $ 671,134 $ 595,329 |
BASIS OF PRESENTATION AND SUMMA
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 6 Months Ended |
Jun. 30, 2023 | |
BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES | |
Basis of Presentation | Basis of Presentation. The interim consolidated financial statements of the Company included herein reflect all adjustments (consisting of normal recurring adjustments) that are, in the opinion of management, necessary to present fairly the financial position and results of operations for the interim periods presented. The results of operations for the interim periods are not necessarily indicative of annualized results for an entire year. The consolidated financial statements include the accounts of Full House and its wholly-owned subsidiaries. All intercompany accounts and transactions have been eliminated in consolidation. |
Fair Value and the Fair Value Input Hierarchy | Fair Value and the Fair Value Input Hierarchy. GAAP categorizes the inputs used for fair value into a three-level hierarchy: ● Level 1: Observable inputs, such as quoted prices in active markets for identical assets or liabilities; ● Level 2: Comparable inputs other than quoted prices that are observable for similar assets or liabilities in less active markets; and ● Level 3: Unobservable inputs which may include metrics that market participants would use to estimate values, such as revenue and earnings multiples and relative rates of return. Methods and assumptions used to estimate the fair value of financial instruments are affected by the duration of the instruments and other factors used by market participants to estimate value. The carrying amounts for cash and equivalents, restricted cash, accounts receivable, and accounts payable approximate their estimated fair value because of the short durations of the instruments and inconsequential rates of interest. |
Cash Equivalents and Restricted Cash | Cash Equivalents and Restricted Cash. Restricted cash balances consist of funds placed into a construction reserve, interest-bearing account to fund the completion of the Chamonix construction project, in accordance with the Company’s debt covenants. |
Accounts Receivable | Accounts Receivable. In March 2023, Rising Star sold its available “free play” for $2.1 million. We received all of such amount in July 2023. Because Indiana has a progressive gaming tax system and Rising Star is one of the smaller casinos in the state, the property has consistently sold its ability to deduct “free play” in computing gaming taxes to operators in higher tax tiers. It sold such “free play” in the second quarter of 2022 for a similar amount. |
Other Intangible Assets | Other Intangible Assets. In March 2023, the Company paid $50.3 million to the Illinois Gaming Board (“IGB”) for required gaming license fees to operate The Temporary, and upon its opening, American Place. Management has deemed the gaming license in Illinois as having an indefinite economic life, as such license is eligible for renewal every four years if all regulatory requirements are met. There may be an additional one-time reconciliation fee, depending on interim gaming revenues, which is calculated three years after commencing operations and can be paid over a six-year period. See Note 6 for details. |
Revenue Recognition | Revenue Recognition: Accrued Club Points and Customer Loyalty Programs: Operating Revenues and Related Costs and Expenses. The transaction price for a casino wager is the difference between gaming wins and losses, not the total amount wagered. As such wagers have similar characteristics, the Company accounts for its gaming transactions on a portfolio basis by recognizing net win per gaming day versus on an individual basis. The Company sometimes provides discretionary complimentary goods and services (“discretionary comps”). For these types of transactions, the Company allocates revenue to the department providing the complimentary goods or services based upon its estimated standalone selling price, offset by a reduction in casino revenues. Many of the Company’s casino customers choose to earn points under its customer loyalty programs. As points are accrued, the Company defers a portion of its casino revenue based on the estimated standalone value of loyalty points being earned by the customer. The standalone value of loyalty points is derived from the retail value of food, beverages, hotel rooms, and other goods or services for which such points may be redeemed. A liability related to these customer loyalty points is recorded, net of estimated breakage and other factors, until the customer redeems these points for various loyalty program benefits, primarily for “free casino play,” complimentary dining, or hotel stays, among others, depending on each property’s specific offers. Upon redemption, the related revenue is recognized at retail value within the department providing the goods or services. Unredeemed points are forfeited if the customer becomes and remains inactive for a specified period of time. Such liabilities were approximately $0.7 million for each of June 30, 2023 and December 31, 2022, and these amounts are included in “other accrued liabilities” on the consolidated balance sheets. Revenue for food and beverage, hotel, and other revenue transactions is typically the net amount collected from customers for such goods and services, plus the retail value of (i) discretionary comps and (ii) comps provided in return for redemption of loyalty points. The Company records such revenue as the good or service is transferred to the customer. Additionally, the Company may collect deposits in advance for future hotel reservations or entertainment, among other services, which represent obligations of the Company until the service is provided to the customer. Deferred Revenues: Market Access Fees from Sports Wagering Agreements. Indiana. Colorado. Illinois. In addition to the “market access” fees, deferred revenue includes quarterly and annual prepayments of contracted revenue, as required in three of the Sports Agreements. As of June 30, 2023, $1.3 million of such deferred revenue has been recognized during the year. Deferred revenues consisted of the following, as discussed above: (In thousands) June 30, December 31, Balance Sheet Location 2023 2022 Deferred revenue, current Other accrued liabilities $ 2,000 $ 1,651 Deferred revenue, net of current portion Contract liabilities, net of current portion 8,524 8,856 $ 10,524 $ 10,507 Other Revenues. Revenue by Source. Note 9 |
Income Taxes | Income Taxes. |
Reclassifications | Reclassifications. |
Earnings (loss) per share | Earnings (Loss) Per Share. |
Leases | Leases. For material leases with terms greater than a year, the Company records right-of-use (“ROU”) assets and lease liabilities on the balance sheet, as measured on a discounted basis. For finance leases, the Company recognizes interest expense associated with the lease liability, as well as depreciation (or amortization) expense associated with the ROU asset, depending on whether those ROU assets are expected to transfer to the Company upon lease expiration. If ownership of a finance lease ROU asset is expected to transfer to the Company upon lease expiration, then it is included with the Company’s property and equipment; other qualifying finance lease ROU assets, based on other classifying criteria under Accounting Standards Codification 842 (“ASC 842”), are disclosed separately as “Finance Lease Right-of-Use Assets, Net.” For operating leases, the Company recognizes straight-line rent expense. The Company does not recognize ROU assets or lease liabilities for leases with a term of 12 months or less. However, costs related to short-term leases with terms greater than one month, which the Company deems material, are disclosed as a component of lease expenses when applicable. Additionally, the Company accounts for new and existing leases containing both lease and non-lease components (“embedded leases”) together as a single lease component Finance and operating lease ROU assets and liabilities are recognized based on the present value of future minimum lease payments over the expected lease term at commencement, plus any qualifying initial direct costs paid prior to commencement for ROU assets. As the implicit rate is not determinable in most of the Company’s leases, management uses the Company’s incremental borrowing rate as estimated by third-party valuation specialists in determining the present value of future payments based on the information available at the commencement date and/or modification date. The expected lease terms include options to extend or terminate the lease when it is reasonably certain that the Company will exercise such options. Lease expense for minimum lease payments is recognized on a straight-line basis over the expected lease term for operating leases. For finance leases, the ROU asset depreciates/amortizes on a straight-line basis over the shorter of the lease term or useful life of the ROU asset as applicable, and the lease liability accretes interest based on the interest method using the discount rate determined at lease commencement. |
Preopening costs | Preopening costs. |
Debt Issuance Costs and Debt Discounts | Debt Issuance Costs and Debt Discounts/Premiums. |
Recently Issued Accounting Pronouncements Not Yet Adopted | Recently Issued Accounting Pronouncements Not Yet Adopted. |
ORGANIZATION (Tables)
ORGANIZATION (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
ORGANIZATION | |
Schedule of Properties | Segments and Properties Locations Midwest & South The Temporary by American Place (opened on February 17, 2023) Waukegan, IL Silver Slipper Casino and Hotel Hancock County, MS (near New Orleans) Rising Star Casino Resort Rising Sun, IN (near Cincinnati) West Bronco Billy’s Casino and Hotel Cripple Creek, CO (near Colorado Springs) Chamonix Casino Hotel (scheduled to open December 26, 2023) Cripple Creek, CO (near Colorado Springs) Grand Lodge Casino Incline Village, NV Stockman’s Casino Fallon, NV (one hour east of Reno) Contracted Sports Wagering Three sports wagering websites (“skins”) Colorado Three sports wagering websites (“skins”), one of which is currently idle Indiana One sports wagering website (“skin”), commencing in August 2023 Illinois |
BASIS OF PRESENTATION AND SIG_2
BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES | |
Schedule of Deferred revenues | (In thousands) June 30, December 31, Balance Sheet Location 2023 2022 Deferred revenue, current Other accrued liabilities $ 2,000 $ 1,651 Deferred revenue, net of current portion Contract liabilities, net of current portion 8,524 8,856 $ 10,524 $ 10,507 |
Schedule of Earnings Per Share, Basic and Diluted | The table below reconciles basic and diluted loss per share of common stock: (In thousands) Three Months Ended Six Months Ended June 30, June 30, 2023 2022 2023 2022 Numerator: Net loss ─ basic $ (5,600) $ (4,355) $ (17,015) $ (4,245) Net loss ─ diluted $ (5,600) $ (4,355) $ (17,015) $ (4,245) Denominator: Weighted-average common shares ─ basic 34,496 34,364 34,453 34,313 Potential dilution from share-based awards — 52 — 45 Weighted-average common and common share equivalents ─ diluted 34,496 34,416 34,453 34,358 Anti-dilutive share-based awards excluded from the calculation of diluted loss per share 4,079 3,477 3,962 1,944 |
LEASES (Tables)
LEASES (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
LEASES | |
Balance Sheet Information For Leases | Leases recorded on the balance sheet consist of the following: (In thousands) June 30, December 31, Leases Balance Sheet Classification 2023 2022 Assets Operating lease assets Operating Lease Right-of-Use Assets, Net $ 46,293 $ 15,771 Finance lease assets Property and Equipment, Net (1) 4,487 4,566 Finance lease assets Finance Lease Right-of-Use Assets, Net (2) 2,979 3,808 Total lease assets $ 53,759 $ 24,145 Liabilities Current Operating Current Portion of Operating Lease Obligations $ 3,588 $ 2,485 Finance Current Portion of Finance Lease Obligation 1,605 1,581 Noncurrent Operating Operating Lease Obligations, Net of Current Portion 42,902 13,418 Finance Finance Lease Obligation, Net of Current Portion 3,756 4,727 Total lease liabilities $ 51,851 $ 22,211 __________ (1) Finance lease assets are recorded net of accumulated amortization of $3.2 million for each of June 30, 2023 and December 31, 2022. (2) These finance lease assets are recorded separately from Property and Equipment due to meeting qualifying classification criteria under ASC 842, but ownership of such assets is not expected to transfer to the Company upon term expiration. Additionally, amortization of these assets are expensed over the duration of the lease term or the assets’ estimated useful lives, whichever is earlier. |
Components of Lease Expense | The components of lease expenses are as follows: (In thousands) Three Months Ended Six Months Ended Classification within June 30, June 30, Lease Costs Statement of Operations 2023 2022 2023 2022 Operating leases: Fixed/base rent Selling, General and Administrative Expenses $ 2,170 $ 1,172 $ 3,962 $ 2,337 Short-term payments Selling, General and Administrative Expenses — 33 22 70 Variable payments Selling, General and Administrative Expenses 349 352 654 738 Finance leases: Amortization of leased assets Depreciation and Amortization 348 39 701 78 Interest on lease liabilities Interest Expense, Net 109 35 220 72 Total lease costs $ 2,976 $ 1,631 $ 5,559 $ 3,295 |
Finance Lease, Liability, Maturity | (In thousands) Operating Financing Years Ending December 31, Leases Leases 2023 (excluding the six months ended June 30, 2023) $ 3,848 $ 979 2024 7,735 1,957 2025 5,722 1,939 2026 4,864 652 2027 4,515 489 Thereafter 316,582 — Total future minimum lease payments 343,266 6,016 Less: Amount representing interest (296,776) (655) Present value of lease liabilities 46,490 5,361 Less: Current lease obligations (3,588) (1,605) Long-term lease obligations $ 42,902 $ 3,756 |
Other Information Related To Lease Term And Discount Rate | Other information related to lease term and discount rate is as follows: June 30, December 31, Lease Term and Discount Rate 2023 2022 Weighted-average remaining lease term Operating leases 66.3 years 23.2 years Finance lease 3.3 years 3.7 years Weighted-average discount rate Operating leases 10.89 % 9.73 % Finance leases 7.74 % 7.08 % |
Supplemental Cash Flow Information Related To Leases | (In thousands) Six Months Ended June 30, Cash paid for amounts included in the measurement of lease liabilities: 2023 2022 Operating cash flows for operating leases $ 3,898 $ 2,436 Operating cash flows for finance leases $ 220 $ 72 Financing cash flows for finance leases $ 759 $ 254 |
LONG-TERM DEBT (Tables)
LONG-TERM DEBT (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
LONG-TERM DEBT. | |
Schedule of Long-Term Debt | (In thousands) June 30, December 31, 2023 2022 Revolving Credit Facility due 2026 $ 27,000 $ — 8.25% Senior Secured Notes due 2028 450,000 410,000 Less: Unamortized debt issuance costs and discounts/premiums, net (13,346) (8,148) $ 463,654 $ 401,852 |
Debt Instrument Redemption | At any time on or after February 15, 2024, the Company may redeem some or all of the Notes for cash at the following redemption prices: Redemption Periods Percentage Premium February 15, 2024 to February 14, 2025 104.125 % February 15, 2025 to February 14, 2026 102.063 % February 15, 2026 and Thereafter 100.000 % |
EARNINGS (LOSS) PER SHARE (Tabl
EARNINGS (LOSS) PER SHARE (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
EARNINGS (LOSS) PER SHARE | |
Schedule of Earnings Per Share, Basic and Diluted | The table below reconciles basic and diluted loss per share of common stock: (In thousands) Three Months Ended Six Months Ended June 30, June 30, 2023 2022 2023 2022 Numerator: Net loss ─ basic $ (5,600) $ (4,355) $ (17,015) $ (4,245) Net loss ─ diluted $ (5,600) $ (4,355) $ (17,015) $ (4,245) Denominator: Weighted-average common shares ─ basic 34,496 34,364 34,453 34,313 Potential dilution from share-based awards — 52 — 45 Weighted-average common and common share equivalents ─ diluted 34,496 34,416 34,453 34,358 Anti-dilutive share-based awards excluded from the calculation of diluted loss per share 4,079 3,477 3,962 1,944 |
SHARE-BASED COMPENSATION (Table
SHARE-BASED COMPENSATION (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
STOCK-BASED COMPENSATION | |
Schedule of Common Stock Options | The following table summarizes information related to the Company’s common stock options as of June 30, 2023: Weighted Number Average of Stock Exercise Options Price Options outstanding at January 1, 2023 3,503,235 $ 2.80 Granted 350,754 7.40 Exercised (53,962) 1.38 Canceled/Forfeited (20,000) 6.88 Expired (20,000) 3.22 Options outstanding at June 30, 2023 3,760,027 $ 3.22 Options exercisable at June 30, 2023 3,039,335 $ 2.23 |
Schedule of compensation expense | (In thousands) Three Months Ended Six Months Ended June 30, June 30, Compensation Expense 2023 2022 2023 2022 Stock options $ 372 $ 302 $ 702 $ 520 Restricted and performance-based shares 283 185 701 310 $ 655 $ 487 $ 1,403 $ 830 |
SEGMENT REPORTING AND DISAGGR_2
SEGMENT REPORTING AND DISAGGREGATED REVENUE (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
SEGMENT REPORTING AND DISAGGREGATED REVENUE | |
Schedule of Total Revenues By Segment | As a result of the change in reportable segments described above, the Company has recast previously-reported segment information to conform to the current presentation in the following tables: (In thousands) Three Months Ended June 30, 2023 Contracted Sports Midwest & South West Wagering Total Revenues Casino $ 38,281 $ 7,078 $ — $ 45,359 Food and beverage 7,894 779 — 8,673 Hotel 2,229 119 — 2,348 Other operations, including 1,507 113 1,382 3,002 $ 49,911 $ 8,089 $ 1,382 $ 59,382 Adjusted Segment EBITDA $ 9,391 $ 177 $ 1,361 $ 10,929 Other operating costs and expenses: Depreciation and amortization (8,155) Corporate expenses (422) Project development costs (17) Preopening costs (1,086) Stock-based compensation (655) Operating income 594 Other expense: Interest expense, net (5,633) (5,633) Loss before income taxes (5,039) Income tax provision 561 Net loss $ (5,600) (In thousands) Three Months Ended June 30, 2022 Contracted Sports Midwest & South West Wagering Total Revenues Casino $ 21,197 $ 8,291 $ — $ 29,488 Food and beverage 6,236 697 — 6,933 Hotel 2,262 145 — 2,407 Other operations, 3,241 145 2,169 5,555 $ 32,936 $ 9,278 $ 2,169 $ 44,383 Adjusted Segment EBITDA $ 9,149 $ 1,684 $ 2,196 $ 13,029 Other operating costs and expenses: Depreciation and amortization (1,834) Corporate expenses (943) Project development costs (17) Preopening costs (1,534) Gain on disposal of assets 5 Stock-based compensation (487) Operating income 8,219 Other expenses: Interest expense, net (6,988) Loss on modification of debt (19) Income before income taxes 1,212 Income tax provision 5,567 Net loss $ (4,355) (In thousands) Six Months Ended June 30, 2023 Contracted Sports Midwest & South West Wagering Total Revenues Casino $ 67,133 $ 14,213 $ — $ 81,346 Food and beverage 14,791 1,542 — 16,333 Hotel 4,269 223 — 4,492 Other operations, 4,520 235 2,562 7,317 $ 90,713 $ 16,213 $ 2,562 $ 109,488 Adjusted Segment EBITDA $ 20,077 $ 234 $ 2,522 $ 22,833 Other operating costs and expenses: Depreciation and amortization (14,014) Corporate expenses (2,201) Project development costs (24) Preopening costs (11,583) Stock-based compensation (1,403) Operating loss (6,392) Other (expense) income: Interest expense, net (10,452) Gain on insurance settlement 355 (10,097) Loss before income taxes (16,489) Income tax provision 526 Net loss $ (17,015) (In thousands) Six Months Ended June 30, 2022 Contracted Sports Midwest & South West Wagering Total Revenues Casino $ 42,595 $ 15,977 $ — $ 58,572 Food and beverage 12,048 1,396 — 13,444 Hotel 4,305 281 — 4,586 Other operations, 3,934 270 5,000 9,204 $ 62,882 $ 17,924 $ 5,000 $ 85,806 Adjusted Segment EBITDA $ 16,239 $ 2,191 $ 4,964 $ 23,394 Other operating costs and expenses: Depreciation and amortization (3,626) Corporate expenses (2,911) Project development costs (182) Preopening costs (2,320) Loss on disposal of assets (3) Stock-based compensation (830) Operating income 13,522 Other expenses: Interest expense, net (13,387) Loss on modification of debt (4,425) (17,812) Loss before income taxes (4,290) Income tax benefit (45) Net loss $ (4,245) |
Schedule of Total Assets By Segment | (In thousands) June 30, December 31, 2023 2022 Total Assets Midwest & South $ 297,499 $ 194,033 West 352,554 351,069 Contracted Sports Wagering 1,658 1,658 Corporate and Other 19,423 48,569 $ 671,134 $ 595,329 |
ORGANIZATION - Resort (Details)
ORGANIZATION - Resort (Details) | Jun. 30, 2023 item |
Number of casinos operated | 6 |
Number of casinos owned or leased | 5 |
Number of casinos located within a hotel owned by a third party | 1 |
Number of sports skins operating | 7 |
INDIANA | |
Number of sports skins operating | 3 |
COLORADO | |
Number of sports skins operating | 3 |
ILLINOIS | |
Number of sports skins operating | 1 |
BASIS OF PRESENTATION AND SUM_2
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Leases (Details) | Jun. 30, 2023 |
BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES | |
Lease, Practical Expedient, Lessor Single Lease Component [true false] | true |
BASIS OF PRESENTATION AND SIG_3
BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES - Other Intangible Assets (Details) - USD ($) $ in Thousands | 1 Months Ended | 6 Months Ended | ||
Mar. 31, 2023 | Jun. 30, 2023 | Jun. 30, 2022 | Dec. 31, 2022 | |
Intangible assets, net (excluding goodwill) [Abstract] | ||||
Other intangible assets, net | $ 61,103 | $ 10,869 | ||
Acquisition of intangible assets | $ (50,250) | $ 0 | ||
Gaming Licenses | ||||
Intangible assets, net (excluding goodwill) [Abstract] | ||||
Acquisition of intangible assets | $ (50,300) |
BASIS OF PRESENTATION AND SUM_3
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Accounts Receivable (Details) $ in Millions | May 31, 2022 USD ($) |
Free play | |
Basis Of Presentation [Line Items] | |
Receivable from sale of free play | $ 2.1 |
BASIS OF PRESENTATION AND SUM_4
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Deferred Revenues (Details) - USD ($) $ in Thousands | Jun. 30, 2023 | Dec. 31, 2022 |
BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES | ||
Deferred revenue, current | $ 2,000 | $ 1,651 |
Deferred revenue, net of current portion | 8,524 | 8,856 |
Contract with Customer, Liability, Total | $ 10,524 | $ 10,507 |
BASIS OF PRESENTATION AND SUM_5
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Deferred Revenues: Market Access Fees from Sports Wagering Agreements (Details) $ in Thousands | 1 Months Ended | 3 Months Ended | 6 Months Ended | |||
May 31, 2022 USD ($) | Jun. 30, 2023 USD ($) item | Jun. 30, 2022 USD ($) | Jun. 30, 2023 USD ($) item | Jun. 30, 2022 USD ($) | Dec. 31, 2022 USD ($) | |
Basis Of Presentation [Line Items] | ||||||
Deferred revenues | $ 10,524 | $ 10,524 | $ 10,507 | |||
Revenue from Contract with Customer, Excluding Assessed Tax | 59,382 | $ 44,383 | 109,488 | $ 85,806 | ||
Liabilities in other accrued expenses | 700 | 700 | $ 700 | |||
Total operating costs and expenses | $ 58,788 | $ 36,164 | $ 115,880 | $ 72,284 | ||
COLORADO | ||||||
Basis Of Presentation [Line Items] | ||||||
Term of agreement | 10 years | |||||
Number of contracted mobile sports operators intended to cease operations | item | 1 | 1 | ||||
Minimum revenues receivable | $ 3,000 | $ 3,000 | ||||
INDIANA | ||||||
Basis Of Presentation [Line Items] | ||||||
Number of contracted mobile sports operators intended to cease operations | item | 1 | 1 | ||||
Minimum revenues receivable | $ 2,000 | $ 2,000 | ||||
ILLINOIS | ||||||
Basis Of Presentation [Line Items] | ||||||
Term of agreement | 8 years | |||||
Upfront fee received | $ 5,000 | |||||
Minimum revenues receivable | $ 5,000 | |||||
Sports Wagering Agreements | ||||||
Basis Of Presentation [Line Items] | ||||||
Term of agreement | 8 years | |||||
Sports Wagering Agreements | COLORADO | ||||||
Basis Of Presentation [Line Items] | ||||||
Deferred revenue | $ 1,300 | |||||
Number of contracted mobile sports operators in operations | item | 3 | |||||
Sports Wagering Agreements | INDIANA | ||||||
Basis Of Presentation [Line Items] | ||||||
Number of contracted mobile sports operators in operations | item | 3 |
LEASES - Narrative (Details)
LEASES - Narrative (Details) | 1 Months Ended | 6 Months Ended | 12 Months Ended | 108 Months Ended | |||
Jan. 01, 2018 USD ($) | Jan. 31, 2023 USD ($) a | Jun. 30, 2017 USD ($) ft² | Jun. 30, 2023 USD ($) a room Option | Dec. 31, 2004 USD ($) a | Jan. 31, 2035 USD ($) | Mar. 31, 2020 USD ($) | |
Grand Lodge Casino facility | |||||||
Lessee, Lease, Description [Line Items] | |||||||
Rent | $ 2 | ||||||
Corporate Office Lease | |||||||
Lessee, Lease, Description [Line Items] | |||||||
Rent | $ 200,000 | ||||||
Office lease, square feet | ft² | 4,479 | ||||||
Land Lease With City of Waukegan, Illinois | |||||||
Lessee, Lease, Description [Line Items] | |||||||
Lessee, Operating Lease, Term of Contract | 99 years | ||||||
Area of land subject to ground lease | a | 32 | ||||||
Land lease | Land Lease Of Silver Slipper Casino Site | |||||||
Lessee, Lease, Description [Line Items] | |||||||
Percentage of gross gaming revenue | 3% | ||||||
Gross gaming revenue (in excess of) | $ 3,650,000 | ||||||
Cost to exercise purchase option | $ 15,500,000 | ||||||
Retained interest in percentages of net income | 3% | ||||||
Retained interest in percentages of net income, term | 10 years | ||||||
Annual Guaranteed Minimum Rent | $ 900,000 | ||||||
Land lease | Land Lease Of Silver Slipper Casino Site | Marshland | |||||||
Lessee, Lease, Description [Line Items] | |||||||
Area of land subject to ground lease | a | 31 | ||||||
Land lease | Land Lease Of Silver Slipper Casino Site | Parcel | |||||||
Lessee, Lease, Description [Line Items] | |||||||
Area of land subject to ground lease | a | 7 | ||||||
Certain parking lots and buildings | Bronco Billy's Casino and Hotel | |||||||
Lessee, Lease, Description [Line Items] | |||||||
Cost to exercise purchase option | $ 7,600,000 | ||||||
Number of original renewal options | Option | 6 | ||||||
Certain parking lots and buildings | Lease Terms, Option One | Bronco Billy's Casino and Hotel | |||||||
Lessee, Lease, Description [Line Items] | |||||||
Lease extension term | 3 years | ||||||
Certain parking lots and buildings | Lease Terms, Option Two | Bronco Billy's Casino and Hotel | |||||||
Lessee, Lease, Description [Line Items] | |||||||
Operating Leases Annual Rent Payment | $ 400,000 | ||||||
Waukegan Ground Lease | |||||||
Lessee, Lease, Description [Line Items] | |||||||
Adjacent area parcel | a | 10 | ||||||
Annual Guaranteed Minimum Rent | $ 3,000,000 | ||||||
Adjusted Gross Receipts (in percent) | 2.50% | ||||||
Amount required to purchase lease area | $ 30,000,000 | ||||||
Rising Star Casino Resort | Rising Sun/Ohio County First, Inc | |||||||
Lessee, Lease, Description [Line Items] | |||||||
Number of hotel rooms | room | 104 | ||||||
Project actual cost | $ 7,700,000 | ||||||
Potential purchase price | 2,500,000 | ||||||
Option price at lease maturity | $ 1 | ||||||
Option to purchase land area | a | 3.01 | ||||||
Minimum | |||||||
Lessee, Lease, Description [Line Items] | |||||||
Lease terms | 1 month | ||||||
Minimum | Certain parking lots and buildings | Bronco Billy's Casino and Hotel | Scenario, Forecast | |||||||
Lessee, Lease, Description [Line Items] | |||||||
Operating Leases Annual Rent Payment | $ 500,000 | ||||||
Maximum | |||||||
Lessee, Lease, Description [Line Items] | |||||||
Lease terms | 99 years |
LEASES - Balance Sheet Details
LEASES - Balance Sheet Details (Details) - USD ($) $ in Thousands | 6 Months Ended | 12 Months Ended |
Jun. 30, 2023 | Dec. 31, 2022 | |
LEASES | ||
Operating lease assets | $ 46,293 | $ 15,771 |
Operating Lease, Right-of-Use Asset, Statement of Financial Position [Extensible List] | Operating lease assets | Operating lease assets |
Finance lease assets | $ 4,487 | $ 4,566 |
Finance Lease Right of Use Asset, Net Included in Property Plant and Equipment [Extensible Enumeration] | Property Plant And Equipment And Partial Finance Lease Right Of Use Asset After Accumulated Depreciation And Amortization | Property Plant And Equipment And Partial Finance Lease Right Of Use Asset After Accumulated Depreciation And Amortization |
Finance lease assets | $ 2,979 | $ 3,808 |
Finance Lease, Right-of-Use Asset, Statement of Financial Position [Extensible List] | Finance lease assets | Finance lease assets |
Total lease assets | $ 53,759 | $ 24,145 |
Current operating lease liability | $ 3,588 | $ 2,485 |
Operating Lease, Liability, Current, Statement of Financial Position [Extensible List] | Current operating lease liability | Current operating lease liability |
Current finance lease liability | $ 1,605 | $ 1,581 |
Finance Lease, Liability, Current, Statement of Financial Position [Extensible List] | Current finance lease liability | Current finance lease liability |
Noncurrent operating lease liability | $ 42,902 | $ 13,418 |
Operating Lease, Liability, Noncurrent, Statement of Financial Position [Extensible List] | Noncurrent operating lease liability | Noncurrent operating lease liability |
Noncurrent finance lease liability | $ 3,756 | $ 4,727 |
Finance Lease, Liability, Noncurrent, Statement of Financial Position [Extensible List] | Noncurrent finance lease liability | Noncurrent finance lease liability |
Total lease liabilities | $ 51,851 | $ 22,211 |
Finance Lease, Right-of-Use Asset, Accumulated Amortization | $ 3,200 | $ 3,200 |
LEASES - Lease Expense (Details
LEASES - Lease Expense (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2023 | Jun. 30, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | |
LEASES | ||||
Fixed/base rent | $ 2,170 | $ 1,172 | $ 3,962 | $ 2,337 |
Short-term payments | 33 | 22 | 70 | |
Variable payments | 349 | 352 | 654 | 738 |
Amortization of leased assets | 348 | 39 | 701 | 78 |
Interest on lease liabilities | 109 | 35 | 220 | 72 |
Total lease costs | $ 2,976 | $ 1,631 | $ 5,559 | $ 3,295 |
LEASES - Maturities of Lease Li
LEASES - Maturities of Lease Liabilities (Details) - USD ($) $ in Thousands | Jun. 30, 2023 | Dec. 31, 2022 |
Operating Leases | ||
2023 (excluding the six months ended June 30, 2023) | $ 3,848 | |
2024 | 7,735 | |
2025 | 5,722 | |
2026 | 4,864 | |
2027 | 4,515 | |
Thereafter | 316,582 | |
Total future minimum lease payments | 343,266 | |
Less: Amount representing interest | (296,776) | |
Present value of lease liabilities | 46,490 | |
Less: Current lease obligations | (3,588) | $ (2,485) |
Long-term lease obligations | 42,902 | 13,418 |
Financing Lease | ||
2022 (excluding the nine months ended September 30, 2022) | 979 | |
2023 | 1,957 | |
2024 | 1,939 | |
2025 | 652 | |
2026 | 489 | |
Total future minimum lease payments | 6,016 | |
Less: Amount representing interest | (655) | |
Present value of lease liabilities | 5,361 | |
Less: Current lease obligations | (1,605) | (1,581) |
Long-term lease obligations | $ 3,756 | $ 4,727 |
LEASES - Lease Term and Discoun
LEASES - Lease Term and Discount Rate (Details) | Jun. 30, 2023 | Dec. 31, 2022 |
LEASES | ||
Weighted-average remaining lease term, operating leases | 66 years 3 months 18 days | 23 years 2 months 12 days |
Weighted-average remaining lease term, finance leases | 3 years 3 months 18 days | 3 years 8 months 12 days |
Weighted-average discount rate, operating leases | 10.89% | 9.73% |
Weighted-average discount rate, finance leases | 7.74% | 7.08% |
LEASES - Supplemental Cash Flow
LEASES - Supplemental Cash Flow Information (Details) - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2023 | Jun. 30, 2022 | |
Cash paid for amounts included in the measurement of lease liabilities: | ||
Operating cash flows for operating leases | $ 3,898 | $ 2,436 |
Operating cash flows for finance lease | 220 | 72 |
Financing cash flows for finance lease | $ 759 | $ 254 |
LONG-TERM DEBT - Senior Secured
LONG-TERM DEBT - Senior Secured Notes Narrative (Details) $ in Thousands | 6 Months Ended | |||||
Feb. 21, 2023 USD ($) | Feb. 07, 2022 USD ($) item | Jun. 30, 2023 USD ($) | Jun. 30, 2022 USD ($) | Jan. 31, 2022 USD ($) | Feb. 12, 2021 USD ($) | |
Line of Credit Facility [Line Items] | ||||||
Proceeds from Senior Secured Notes due 2028 borrowings | $ 40,000 | $ 100,000 | ||||
Proceeds from the offering, net of related expenses and discounts | $ 34,000 | |||||
Senior Secured Notes Due 2028 | Senior Secured Notes | ||||||
Line of Credit Facility [Line Items] | ||||||
Proceeds from Senior Secured Notes due 2028 borrowings | 40,000 | |||||
Number of Supplemental Indentures Entered | item | 3 | |||||
Senior Secured Notes Due 2028 | Senior Secured Notes | ||||||
Line of Credit Facility [Line Items] | ||||||
Aggregate principal amount | $ 450,000 | $ 310,000 | ||||
Additional principal amount of debt issued | $ 100,000 | |||||
Issue price, percentage | 102% | |||||
Interest rate | 8.25% | 8.25% | ||||
Borrowed funds designated for constructing project | $ 221,000 | $ 180,000 |
LONG-TERM DEBT - Redemption of
LONG-TERM DEBT - Redemption of Senior Secured Notes (Details) - Senior Secured Notes | 6 Months Ended | |
Feb. 12, 2021 | Jun. 30, 2023 | |
Senior Secured Notes Due 2028 | ||
Line of Credit Facility [Line Items] | ||
Percentage of principal amount of debt redeemed | 35% | |
Percentage Premium | 100% | |
Percentage of redemption of equity offering | 108.25% | |
February 15, 2024 to February 14, 2025 | Senior Secured Notes Due 2028 | ||
Line of Credit Facility [Line Items] | ||
Percentage of principal amount of debt redeemed | 104.125% | |
February 15, 2025 to February 14, 2026 | Senior Secured Notes Due 2028 | ||
Line of Credit Facility [Line Items] | ||
Percentage of principal amount of debt redeemed | 102.063% | |
February 15, 2026 and Thereafter | Senior Secured Notes Due 2028 | ||
Line of Credit Facility [Line Items] | ||
Percentage of principal amount of debt redeemed | 100% |
LONG-TERM DEBT - Revolving Cred
LONG-TERM DEBT - Revolving Credit Facility (Details) - Revolving Credit Facility - USD ($) $ in Millions | Feb. 07, 2022 | Jun. 30, 2023 | Feb. 21, 2023 | Mar. 31, 2021 |
Debt Instrument [Line Items] | ||||
Agreement of revolving credit facility | $ 40 | $ 15 | ||
Line of Credit Facility, Additional Borrowing Capacity | $ 40 | $ 25 | ||
Outstanding borrowings | $ 27 | |||
SOFR | Until Completion of Chamonix Project | ||||
Debt Instrument [Line Items] | ||||
Applicable margin rate | 3.50% | |||
Adjustment rate | 0.15% | |||
SOFR | After Completion of Chamonix Project | ||||
Debt Instrument [Line Items] | ||||
Applicable margin rate | 3% | |||
Adjustment rate | 0.15% | |||
Base Rate | Until Completion of Chamonix Project | ||||
Debt Instrument [Line Items] | ||||
Applicable margin rate | 2.50% | |||
Base Rate | After Completion of Chamonix Project | ||||
Debt Instrument [Line Items] | ||||
Applicable margin rate | 2% |
LONG-TERM DEBT - Long-Term Debt
LONG-TERM DEBT - Long-Term Debt (Details) - USD ($) $ in Thousands | Jun. 30, 2023 | Dec. 31, 2022 | Feb. 12, 2021 |
Debt Instrument [Line Items] | |||
Unamortized debt issuance costs, discounts and premiums, net | $ (13,346) | $ (8,148) | |
Long-term debt, net | 463,654 | 401,852 | |
Revolving Credit Facility Due 2026 | Senior Secured Notes | |||
Debt Instrument [Line Items] | |||
Outstanding principal | 27,000 | ||
Senior Secured Notes Due 2028 | Senior Secured Notes | |||
Debt Instrument [Line Items] | |||
Outstanding principal | $ 450,000 | 410,000 | |
Debt Instrument, Interest Rate, Stated Percentage | 8.25% | 8.25% | |
Estimated fair value | $ 421,600 | $ 360,600 |
INCOME TAXES (Details)
INCOME TAXES (Details) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2023 | Jun. 30, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | |
INCOME TAXES | ||||
Effective income tax rate | (11.10%) | 459.30% | (3.20%) | 1% |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Details) $ in Thousands | 1 Months Ended | 3 Months Ended | 6 Months Ended | |||
Mar. 31, 2023 | May 31, 2022 USD ($) item | Mar. 31, 2023 | Jun. 30, 2023 USD ($) | Jun. 30, 2022 USD ($) | Dec. 31, 2022 USD ($) | |
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | ||||||
Paid for option agreement | $ 3,898 | $ 2,436 | ||||
Deferred revenues | 10,524 | $ 10,507 | ||||
Contract Liability to Circa Sports [Member] | ||||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | ||||||
Contractual Obligation | $ 5,000 | |||||
COLORADO | ||||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | ||||||
Minimum revenues receivable | $ 3,000 | |||||
Term of agreement | 10 years | |||||
ILLINOIS | ||||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | ||||||
Upfront fee received | 5,000 | |||||
Minimum revenues receivable | $ 5,000 | |||||
Term of agreement | 8 years | |||||
ILLINOIS | Contingent Gaming Licensing Fees [Member] | ||||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | ||||||
Other Commitment, Reconciliation Payment, Percentage of Adjusted Gross Receipt | 75% | 75% | ||||
Other Commitment, Reconciliation Payment Calculation, Gross Receipt Trailing Months | 12 months | |||||
Reconciliation payments, Installment period | 6 years | |||||
Sports Wagering Agreements | ||||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | ||||||
Additional Revenue Receivable | $ 5,000 | |||||
Number of extension | item | 2 | |||||
Duration of extension term | 4 years | |||||
Term of agreement | 8 years |
EARNINGS (LOSS) PER SHARE - Rec
EARNINGS (LOSS) PER SHARE - Reconciliation of Earnings Per Share (Details) - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2023 | Jun. 30, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | |
Numerator: | ||||
Net loss basic | $ (5,600) | $ (4,355) | $ (17,015) | $ (4,245) |
Net loss diluted | $ (5,600) | $ (4,355) | $ (17,015) | $ (4,245) |
Denominator: | ||||
Weighted-average common share - basic (in shares) | 34,496 | 34,364 | 34,453 | 34,313 |
Potential dilution from share-based awards (in shares) | 52 | 45 | ||
Weighted-average common and common share equivalents - diluted (in shares) | 34,496 | 34,416 | 34,453 | 34,358 |
Anti-dilutive share-based awards excluded from the calculation of diluted loss per share | 4,079 | 3,477 | 3,962 | 1,944 |
SHARE-BASED COMPENSATION (Detai
SHARE-BASED COMPENSATION (Details) $ in Millions | 1 Months Ended | 3 Months Ended | 6 Months Ended | |
May 18, 2023 shares | Apr. 30, 2023 shares | Jun. 30, 2023 USD ($) item shares | Jun. 30, 2023 USD ($) shares | |
Stock options | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Unrecognized compensation cost | $ | $ 2.9 | $ 2.9 | ||
Weighted-average period of unrecognized compensation cost expected to be recognized | 2 years 2 months 12 days | |||
Performance shares | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
No .of performance based shares vested | 64,223 | |||
Number of shares approved for vesting | 73,885 | |||
Performance shares | Vest on the anniversary date of the award if the Company's annual Adjusted EBITDA for 2023 reflects at least 10% per annum growth | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Vesting rights, percentage | 16.67% | |||
Stock Based Awards Incentive Marker 1 Percentage | 10% | |||
Performance shares | Vest on the anniversary date if the Company's annual Free Cash Flow Per Share for 2023 reflects at least 12% per annum growth | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Vesting rights, percentage | 16.67% | |||
Stock Based Awards Incentive Marker 2 Percentage | 12% | |||
Restricted and performance shares | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Unrecognized compensation cost | $ | $ 2 | $ 2 | ||
Weighted-average period of unrecognized compensation cost expected to be recognized | 1 year 4 months 24 days | |||
Non Executive Director [Member] | Restricted stock | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Shares granted | 70,945 | |||
Vesting period of remaining shares | 1 year | |||
2015 Equity Incentive Plan | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Number of shares available for future issuance (in shares) | 671,041 | 671,041 | ||
2015 Equity Incentive Plan | Three Company Executives | Performance shares | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Shares granted | 79,815 | 40,541 | ||
Number Of Executives | item | 4 |
SHARE-BASED COMPENSATION - Summ
SHARE-BASED COMPENSATION - Summarizes information related to our common stock options (Details) - Stock options | 6 Months Ended |
Jun. 30, 2023 $ / shares shares | |
Number of Stock Options | |
Options outstanding, beginning balance (in shares) | shares | 3,503,235 |
Granted (in shares) | shares | 350,754 |
Exercised (in shares) | shares | (53,962) |
Canceled/Forfeited (in shares) | shares | (20,000) |
Expired (in shares) | shares | (20,000) |
Options outstanding, ending balance (in shares) | shares | 3,760,027 |
Options exercisable (in shares) | shares | 3,039,335 |
Weighted Average Exercise Price | |
Weighted average exercise price, Options outstanding (in dollars per share) | $ / shares | $ 2.80 |
Granted (in dollars per share) | $ / shares | 7.40 |
Exercised (in dollars per share) | $ / shares | 1.38 |
Canceled/Forfeited (in dollars per share) | $ / shares | 6.88 |
Expired (in dollars per share) | $ / shares | 3.22 |
Weighted average exercise price, Options outstanding (in dollars per share) | $ / shares | 3.22 |
Weighted average exercise price, Options exercisable (in dollars per share) | $ / shares | $ 2.23 |
SHARE-BASED COMPENSATION - Comp
SHARE-BASED COMPENSATION - Compensation Expenses (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2023 | Jun. 30, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | |
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||||
Compensation expense | $ 655 | $ 487 | $ 1,403 | $ 830 |
Stock options | ||||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||||
Compensation expense | 372 | 302 | 702 | 520 |
Restricted stocks and Performance-based shares | ||||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||||
Compensation expense | $ 283 | $ 185 | $ 701 | $ 310 |
SEGMENT REPORTING AND DISAGGR_3
SEGMENT REPORTING AND DISAGGREGATED REVENUE - Selected Statement of Operations Data (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||||
Jun. 30, 2023 | Mar. 31, 2023 | Jun. 30, 2022 | Mar. 31, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | |
Segment Reporting Information [Line Items] | ||||||
Net Revenues | $ 59,382 | $ 44,383 | $ 109,488 | $ 85,806 | ||
Adjusted Segment EBITDA | 10,929 | 13,029 | 22,833 | 23,394 | ||
Depreciation and amortization | (8,155) | (1,834) | (14,014) | (3,626) | ||
Corporate expenses | (422) | (943) | (2,201) | (2,911) | ||
Project development costs | (17) | (17) | (24) | (182) | ||
Preopening costs | (1,086) | (1,534) | (11,583) | (2,320) | ||
Gain (Loss) on disposal of assets, net | 5 | 0 | (3) | |||
Stock-based compensation | (655) | (487) | (1,403) | (830) | ||
Operating income (loss) | 594 | 8,219 | (6,392) | 13,522 | ||
Other expenses: | ||||||
Interest expense, net | (5,633) | (6,988) | (10,452) | (13,387) | ||
Loss on modification of debt | (19) | 0 | (4,425) | |||
Gain on insurance settlement | 355 | 0 | ||||
Nonoperating Income (Expense) | (5,633) | (7,007) | (10,097) | (17,812) | ||
Income (Loss) before income taxes | (5,039) | 1,212 | (16,489) | (4,290) | ||
Income tax provision | 561 | 5,567 | 526 | (45) | ||
Net loss | (5,600) | $ (11,415) | (4,355) | $ 110 | (17,015) | (4,245) |
Midwest and South | ||||||
Segment Reporting Information [Line Items] | ||||||
Net Revenues | 49,911 | 32,936 | 90,713 | 62,882 | ||
Adjusted Segment EBITDA | 9,391 | 9,149 | 20,077 | 16,239 | ||
West | ||||||
Segment Reporting Information [Line Items] | ||||||
Net Revenues | 8,089 | 9,278 | 16,213 | 17,924 | ||
Adjusted Segment EBITDA | 177 | 1,684 | 234 | 2,191 | ||
Contracted Sports Wagering | ||||||
Segment Reporting Information [Line Items] | ||||||
Net Revenues | 1,382 | 2,169 | 2,562 | 5,000 | ||
Adjusted Segment EBITDA | 1,361 | 2,196 | 2,522 | 4,964 | ||
Casino | ||||||
Segment Reporting Information [Line Items] | ||||||
Net Revenues | 45,359 | 29,488 | 81,346 | 58,572 | ||
Casino | Midwest and South | ||||||
Segment Reporting Information [Line Items] | ||||||
Net Revenues | 38,281 | 21,197 | 67,133 | 42,595 | ||
Casino | West | ||||||
Segment Reporting Information [Line Items] | ||||||
Net Revenues | 7,078 | 8,291 | 14,213 | 15,977 | ||
Food and beverage | ||||||
Segment Reporting Information [Line Items] | ||||||
Net Revenues | 8,673 | 6,933 | 16,333 | 13,444 | ||
Food and beverage | Midwest and South | ||||||
Segment Reporting Information [Line Items] | ||||||
Net Revenues | 7,894 | 6,236 | 14,791 | 12,048 | ||
Food and beverage | West | ||||||
Segment Reporting Information [Line Items] | ||||||
Net Revenues | 779 | 697 | 1,542 | 1,396 | ||
Hotel | ||||||
Segment Reporting Information [Line Items] | ||||||
Net Revenues | 2,348 | 2,407 | 4,492 | 4,586 | ||
Hotel | Midwest and South | ||||||
Segment Reporting Information [Line Items] | ||||||
Net Revenues | 2,229 | 2,262 | 4,269 | 4,305 | ||
Hotel | West | ||||||
Segment Reporting Information [Line Items] | ||||||
Net Revenues | 119 | 145 | 223 | 281 | ||
Other operations, including contracted sports wagering | ||||||
Segment Reporting Information [Line Items] | ||||||
Net Revenues | 3,002 | 5,555 | 7,317 | 9,204 | ||
Other operations, including contracted sports wagering | Midwest and South | ||||||
Segment Reporting Information [Line Items] | ||||||
Net Revenues | 1,507 | 3,241 | 4,520 | 3,934 | ||
Other operations, including contracted sports wagering | West | ||||||
Segment Reporting Information [Line Items] | ||||||
Net Revenues | 113 | 145 | 235 | 270 | ||
Other operations, including contracted sports wagering | Contracted Sports Wagering | ||||||
Segment Reporting Information [Line Items] | ||||||
Net Revenues | $ 1,382 | $ 2,169 | $ 2,562 | $ 5,000 |
SEGMENT REPORTING AND DISAGGR_4
SEGMENT REPORTING AND DISAGGREGATED REVENUE - Selected Balance Sheet Data (Details) - USD ($) $ in Thousands | Jun. 30, 2023 | Dec. 31, 2022 |
Segment Reporting Information [Line Items] | ||
Total Assets | $ 671,134 | $ 595,329 |
Corporate and Other | ||
Segment Reporting Information [Line Items] | ||
Total Assets | 19,423 | 48,569 |
Midwest and South | Operating Segments | ||
Segment Reporting Information [Line Items] | ||
Total Assets | 297,499 | 194,033 |
West | Operating Segments | ||
Segment Reporting Information [Line Items] | ||
Total Assets | 352,554 | 351,069 |
Contracted Sports Wagering | Operating Segments | ||
Segment Reporting Information [Line Items] | ||
Total Assets | $ 1,658 | $ 1,658 |