Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 31, 2019 | May 03, 2019 | |
Document and Entity Information | ||
Entity Registrant Name | MONARCH CASINO & RESORT INC | |
Entity Central Index Key | 0000907242 | |
Document Type | 10-Q | |
Document Period End Date | Mar. 31, 2019 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --12-31 | |
Trading Symbol | MCRI | |
Entity Filer Category | Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Common Stock, Shares Outstanding | 17,985,692 | |
Document Fiscal Year Focus | 2019 | |
Document Fiscal Period Focus | Q1 |
CONSOLIDATED STATEMENTS OF INCO
CONSOLIDATED STATEMENTS OF INCOME - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Revenues | ||
Net revenues | $ 58,740 | $ 56,268 |
Operating expenses | ||
Selling, general and administrative | 16,452 | 15,185 |
Depreciation and amortization | 3,603 | 3,692 |
Pre-opening expenses | 436 | |
Total operating expenses | 50,019 | 47,711 |
Income from operations | 8,721 | 8,557 |
Other expenses | ||
Interest expense, net of amounts capitalized | (80) | |
Total other expense | (80) | |
Income before income taxes | 8,721 | 8,477 |
Provision for income taxes | (1,706) | (1,736) |
Net income | $ 7,015 | $ 6,741 |
Earnings per share of common stock | ||
Basic (in dollars per share) | $ 0.39 | $ 0.38 |
Diluted (in dollars per share) | $ 0.38 | $ 0.36 |
Weighted average number of common shares and potential common shares outstanding | ||
Basic (in shares) | 17,937 | 17,770 |
Diluted (in shares) | 18,619 | 18,710 |
Casino | ||
Revenues | ||
Net revenues | $ 28,976 | $ 29,945 |
Operating expenses | ||
Operating expenses | 10,820 | 10,696 |
Food and beverage | ||
Revenues | ||
Net revenues | 17,692 | 16,938 |
Operating expenses | ||
Operating expenses | 13,998 | 13,094 |
Hotel | ||
Revenues | ||
Net revenues | 8,505 | 6,363 |
Operating expenses | ||
Operating expenses | 3,130 | 3,499 |
Other | ||
Revenues | ||
Net revenues | 3,567 | 3,022 |
Operating expenses | ||
Operating expenses | $ 1,580 | $ 1,545 |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Mar. 31, 2019 | Dec. 31, 2018 |
Current assets | ||
Cash and cash equivalents | $ 23,817 | $ 30,462 |
Receivables, net | 5,388 | 6,740 |
Income taxes receivable | 279 | |
Inventories | 3,617 | 3,692 |
Prepaid expenses | 4,691 | 5,508 |
Total current assets | 37,513 | 46,681 |
Property and equipment | ||
Land | 30,034 | 30,034 |
Land improvements | 7,645 | 7,645 |
Buildings | 193,235 | 193,235 |
Buildings improvements | 25,995 | 25,995 |
Furniture and equipment | 145,245 | 139,772 |
Construction in Progress | 213,263 | 180,518 |
Right of use assets | 16,175 | |
Leasehold improvements | 3,782 | 3,782 |
Gross property and equipment | 635,374 | 580,981 |
Less accumulated depreciation and amortization | (209,969) | (206,657) |
Net property and equipment | 425,405 | 374,324 |
Other assets | ||
Goodwill | 25,111 | 25,111 |
Intangible assets, net | 2,412 | 2,704 |
Deferred income taxes | 4,027 | 4,027 |
Other assets, net | 2,146 | 2,280 |
Total other assets | 33,696 | 34,122 |
Total assets | 496,614 | 455,127 |
Current liabilities | ||
Accounts payable | 9,522 | 11,182 |
Construction accounts payable | 19,236 | 17,152 |
Accrued expenses | 29,574 | 31,111 |
Income taxes payable | 1,427 | |
Short-term lease liability | 796 | |
Total current liabilities | 60,555 | 59,445 |
Long-term lease liability | 15,382 | |
Long-term debt | 110,520 | 94,500 |
Total liabilities | 186,457 | 153,945 |
Stockholders' equity | ||
Preferred stock, $.01 par value, 10,000,000 shares authorized; none issued | ||
Common stock, $.01 par value, 30,000,000 shares authorized; 19,096,300 shares issued; 17,976,691 outstanding at March 31, 2019; 17,919,021 outstanding at December 31, 2018 | 191 | 191 |
Additional paid-in capital | 31,267 | 30,111 |
Treasury stock, 1,119,609 shares at March 31, 2019; 1,177,279 shares at December 31, 2018 | (15,072) | (15,876) |
Retained earnings | 293,771 | 286,756 |
Total stockholders' equity | 310,157 | 301,182 |
Total liabilities and stockholders' equity | $ 496,614 | $ 455,127 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares | Mar. 31, 2019 | Dec. 31, 2018 |
CONSOLIDATED BALANCE SHEETS | ||
Preferred stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized | 10,000,000 | 10,000,000 |
Preferred stock, shares issued | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized | 30,000,000 | 30,000,000 |
Common stock, shares issued | 19,096,300 | 19,096,300 |
Common stock, shares outstanding | 17,976,691 | 17,919,021 |
Treasury stock, shares | 1,119,609 | 1,177,279 |
CONSOLIDATED STATEMENTS OF STOC
CONSOLIDATED STATEMENTS OF STOCKHOLDERS EQUITY - USD ($) $ in Thousands | Common Stock | Additional Paid-in Capital | Retained Earnings | Treasury Stock | Total |
Balance at Dec. 31, 2017 | $ 191 | $ 26,890 | $ 257,516 | $ (18,123) | $ 266,474 |
Balance (in shares) at Dec. 31, 2017 | 17,759,446 | ||||
Increase (Decrease) in Stockholders' Equity | |||||
Net exercise of stock options | 85 | 465 | 550 | ||
Net exercise of stock options (in shares) | 32,938 | ||||
Stock-based compensation expense | 566 | 566 | |||
Adjustment to beginning retained earnings for accounting changes in accordance with the new revenue recognition standard | (4,858) | (4,858) | |||
Net income | 6,741 | 6,741 | |||
Balance at Mar. 31, 2018 | $ 191 | 27,541 | 259,399 | (17,658) | 269,473 |
Balance (in shares) at Mar. 31, 2018 | 17,792,384 | ||||
Balance at Dec. 31, 2018 | $ 191 | 30,111 | 286,756 | (15,876) | $ 301,182 |
Balance (in shares) at Dec. 31, 2018 | 17,919,021 | 17,919,021 | |||
Increase (Decrease) in Stockholders' Equity | |||||
Net exercise of stock options | 241 | 804 | $ 1,045 | ||
Net exercise of stock options (in shares) | 57,670 | ||||
Stock-based compensation expense | 915 | 915 | |||
Net income | 7,015 | 7,015 | |||
Balance at Mar. 31, 2019 | $ 191 | $ 31,267 | $ 293,771 | $ (15,072) | $ 310,157 |
Balance (in shares) at Mar. 31, 2019 | 17,976,691 | 17,976,691 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Cash flows from operating activities: | ||
Net income | $ 7,015 | $ 6,741 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Depreciation and amortization | 3,603 | 3,692 |
Amortization of deferred loan costs | 134 | 135 |
Stock-based compensation | 1,960 | 1,115 |
Recoveries for bad debts | (26) | (32) |
Changes in operating assets and liabilities: | ||
Receivables | 1,378 | 1,383 |
Income taxes | 1,706 | 1,736 |
Inventories | 75 | 91 |
Prepaid expenses | 817 | 99 |
Right of use asset, net | 3 | |
Accounts payable | (1,660) | 534 |
Accrued expenses | (1,537) | (2,467) |
Net cash provided by operating activities | 13,468 | 13,027 |
Cash flows from investing activities: | ||
Change in construction payable | 2,084 | 5,394 |
Acquisition of property and equipment | (38,217) | (18,204) |
Net cash used in investing activities | (36,133) | (12,810) |
Cash flows from financing activities: | ||
Long-term debt borrowings | 16,020 | |
Net cash provided by financing activities | 16,020 | |
Change in cash | (6,645) | 217 |
Cash and cash equivalents at beginning of period | 30,462 | 29,151 |
Cash and cash equivalents at end of period | $ 23,817 | 29,368 |
ASC 606 Changes | ASU 2014-09 | ||
Adjustment to beginning retained earnings for accounting changes in accordance with the new revenue recognition standard | ||
Accrued expenses | $ 4,858 |
SUMMARY OF SIGNIFICANT ACCOUNTI
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 3 Months Ended |
Mar. 31, 2019 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | MONARCH CASINO & RESORT, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) QUARTERLY PERIOD ENDED MARCH 31, 2019 NOTE 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of Presentation : Monarch Casino & Resort, Inc. was incorporated in 1993. Unless otherwise indicated, “Monarch” and the “Company” refer to Monarch Casino & Resort, Inc. and its subsidiaries. Monarch owns and operates the Atlantis Casino Resort Spa, a hotel and casino in Reno, Nevada (the “Atlantis”) and Monarch Casino Black Hawk, a casino in Black Hawk, Colorado. In addition, Monarch owns separate parcels of land located next to the Atlantis and a parcel of land with an industrial warehouse located between Denver, Colorado and Monarch Casino Black Hawk. Monarch also owns Chicago Dogs Eatery, Inc. and Monarch Promotional Association, both of which were formed in relation to licensure requirements for extended hours of liquor operation in Black Hawk, Colorado. The accompanying unaudited consolidated financial statements include the accounts of Monarch and its subsidiaries (the “Consolidated Financial Statements”). Intercompany balances and transactions are eliminated. Interim Financial Statements : The Consolidated Financial Statements have been prepared in accordance with U.S. generally accepted accounting principles (“U.S. GAAP”) for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for complete financial statements. In the opinion of the management of the Company, all adjustments considered necessary for a fair presentation are included. Operating results for the three months ended March 31, 2019 are not necessarily indicative of the results that may be expected for the year ending December 31, 2019. The balance sheet at December 31, 2018 has been derived from the audited consolidated financial statements of the Company at that date, but does not include all of the information and footnotes required by U.S. GAAP for complete financial statements. For further information, refer to the consolidated financial statements and footnotes thereto included in the Company’s annual report on Form 10-K for the year ended December 31, 2018. Fair Value of Financial Instruments : The estimated fair value of the Company’s financial instruments has been determined by the Company, using available market information and valuation methodologies. However, considerable judgment is required to develop the estimates of fair value; thus, the estimates provided herein are not necessarily indicative of the amounts that the Company could realize in a current market exchange. The carrying amounts of cash, receivables, accounts payable and accrued expenses approximate fair value because of the short-term nature of these instruments. Additionally, the carrying value of our debt approximates fair value due to the variable nature of applicable interest rates and relatively short-term maturity. Debt Issuance Costs: Costs incurred in connection with the issuance of long-term debt are capitalized and amortized to interest expense over the term of the related debt agreement. Loan issuance costs are included in “Other assets, net” on the Company’s consolidated balance sheets. As of March 31, 2019, loan issuance cost, net of amortization was $1.2 million. Segment Reporting: The accounting guidance for disclosures about segments of an enterprise and related information requires separate financial information to be disclosed for all operating segments of a business. Accounting Standards Codification (“ASC”) 280 allows individual operating segments to be aggregated for reporting purposes if certain criteria are met. The Company determined that the Company’s two operating segments, Atlantis and Monarch Casino Black Hawk, meet all of the aggregation criteria stipulated by ASC 280-10-50-11. The Company views each property as an operating segment and the two operating segments have been aggregated into one reporting segment. Inventories Inventories, consisting primarily of food, beverages, and retail merchandise, are stated at the lower of cost and net realizable value. Cost is determined based on the weighted average, which approximates a first-in, first-out method. Capitalized Interest The Company capitalizes interest costs associated with debt incurred in connection with major construction projects. When no debt is specifically identified as being incurred in connection with a construction project, the Company capitalizes interest on amounts expended on the project at the Company’s average borrowing cost. Interest capitalization is ceased when the project is substantially complete. The Company capitalized $1.2 million during the quarter ended March 31, 2019. Revenue Recognition The majority of the Company’s revenue is recognized when products are delivered or services are performed. For certain revenue transactions (when a patron uses a club loyalty card), in accordance with accounting standard update No. 2014-09 (“ASC 606”), a portion of the revenue is deferred until the points earned by the patron are redeemed or expire. Casino revenue: Casino revenues represent the net win from gaming activity, which is the difference between the amounts won and lost, which represents the transaction price. Jackpots, other than the incremental amount of progressive jackpots, are recognized at the time they are won by customers. Funds deposited by customers in advance and outstanding chips and slot tickets in the customers’ possession are recognized as a liability until such amounts are redeemed or used in gaming play by the customer. Additionally, net win is reduced by the performance obligations for the players’ club program, progressive jackpots and any pre-arranged marker discounts. Progressive jackpot provisions are recognized in two components: 1) as wagers are made for the share of players’ wagers that are contributed to the progressive jackpot award, and 2) as jackpots are won for the portion of the progressive jackpot award contributed by us. Cash discounts and other cash incentives to guests related to gaming play are recorded as a reduction to gaming revenue. Players’ Club Program: The Company operates a players’ club program under which as players perform gaming activities they earn and accumulate points, which may be redeemed for a variety of goods and services. Given the significance of the players’ club program and the ability for members to bank such points based on their past play, we have determined that players’ club program points granted in conjunction with gaming activity constitute a material right and, as such, represent a performance obligation associated with the gaming contracts. At the time points are earned, we recognize deferred revenue at the standalone selling prices (SSP) of the goods and services that the points are expected to be redeemed for, with a corresponding decrease in gaming revenue. The points estimated SSP is computed as the cash redemption value of the points expected to be redeemed, which is determined through an analysis of all redemption activity over the preceding twelve-month period. As of March 31, 2019, we had estimated the obligations related to the players’ club program at $9.4 million, which is included in Accrued Expenses in the Liabilities and Stockholders’ Equity section in the Consolidated Balance Sheet. Pursuant to the new Financial Accounting Standards Board (“FASB”) guidelines, food and beverage, hotel and other complimentaries are now valued at their retail price and included as revenues within their respective categories, with a corresponding decrease in gaming revenues. In addition, the cost of providing these complimentary goods and services are now included as expenses within their respective categories, resulting in a corresponding decrease in casino expenses. Food and Beverage, Hotel and Other (retail) Revenues: Food and Beverage, Hotel and Other Revenues in general are recognized when products are delivered or services are performed. We recognize revenue related to the products and services associated to the players points’ redemptions at the time products are delivered or services are performed, with corresponding reduction in the deferred revenue, at SSP. Other complimentaries in conjunction with the gaming and other business are also valued at SSP. Hotel revenue is presented net of non-third-party rebate and commission. Other Revenues : Other revenues (excluding retail) primarily consist of commissions received on ATM transactions and cash advances, which are recorded on a net basis as the Company represents the agent in its relationship with the third-party service providers, and commissions and fees received in connection with pari-mutuel wagering, which are also recorded on a net basis. Sales and other taxes : Sales taxes and other taxes collected from customers on behalf of governmental authorities are accounted for on a net basis and are not included in revenues or operating expenses. In addition, tips and other gratuities, excluding service charges, collected from customers on behalf of our employees are also accounted for on a net basis and are not included in revenues or operating expenses. |
ACCOUNTING FOR LEASES
ACCOUNTING FOR LEASES | 3 Months Ended |
Mar. 31, 2019 | |
ACCOUNTING FOR LEASES | |
ACCOUNTING FOR LEASES | NOTE 2. ACCOUNTING FOR LEASES We adopted accounting standard update (“ASU”) No. 2016-02, “Leases (Topic 842), (“ASC 842”)” which requires leases with durations greater than twelve months to be recognized on the balance sheet. We adopted the standard using the modified retrospective approach with an effective date as of the beginning of our fiscal year, January 1, 2019. At January 1, 2019 we recorded a transition adjustment for the right of use assets of $16.4 million offset by short- and long-term lease liabilities of $0.9 million and $15.5 million, respectively, properly treated as a non-cash item in the Consolidated Statement of Cash Flows. Prior year financial statements were not recast under the new standard and, therefore, those amounts are not presented below. We elected the package of transition provisions available for expired or existing contracts, which allowed us to carryforward our historical assessments of (1) whether contracts are or contain leases, (2) lease classification and (3) initial direct costs. For leases with terms greater than 12 months, we record the related asset and obligation at the present value of the lease payments over the lease term. Many of our leases include rental escalation clauses, renewal options and/or termination options that are factored into our determination of lease payments when appropriate. As permitted by ASC 842, we elected not to separate non-lease components from their related lease components. When available, we use the rate implicit in the lease to discount lease payments to present value; however, most of our leases do not provide a readily determinable implicit rate. Therefore, we must estimate our incremental borrowing rate to discount the lease payments based on information available at lease commencement. As of the end of the first quarter of 2019 our right of use assets consisted of the Parking Lot Lease, the Driveway Lease (as defined and discussed in NOTE 6. RELATED PARTY TRANSACTIONS) , as well as certain billboard leases. The table below presents information related to the lease costs for operating leases during 2019 (in thousands): Three months ended March 31, 2019 Short-term lease cost $ 88 Long-term lease cost 371 Total lease cost $ 459 Upon adoption of the new lease standard, incremental borrowing rates used for existing leases were established using the rates in effect as of the lease inception or modification date. The w eighted-average incremental borrowing rate of the leases presented in the lease liability as of the end of the first quarter of 2019 was 4.32%. The w eighted-average remaining lease term of the leases presented in the lease liability as of the end of the first quarter of 2019 was 22.06 years. Following is the undiscounted cash flow for the nine months of the current year, for each of the next four years and total of the remaining years to the operating lease liabilities recorded on the balance sheet (in thousands): Operating Leases Year ending December 31, 2019 $ 1,104 2020 1,446 2021 1,432 2022 1,078 2023 1,071 Thereafter 19,084 Total minimum lease payments 25,215 Less: amount of lease payment representing interest (9,037) Present value of future minimum payments 16,178 Less: current obligations under leases (796) Long-term lease obligations $ 15,382 Cash paid related to the operating leases presented in the lease liability as of the end of the first quarter of 2019 was $368 thousand. |
STOCK-BASED COMPENSATION
STOCK-BASED COMPENSATION | 3 Months Ended |
Mar. 31, 2019 | |
STOCK-BASED COMPENSATION. | |
STOCK-BASED COMPENSATION | NOTE 3. STOCK-BASED COMPENSATION In accordance with ASU No. 2016-09, the Company records any excess tax benefits or deficiencies from its equity awards in its Consolidated Statements of Income in the reporting periods in which vesting occurs. As a result, the Company’s income tax expense and associated effective tax rate are impacted by fluctuations in stock price between the grant dates and vesting dates of equity awards. For the three months ended March 31, 2019 and 2018, the effect of the adoption of ASU No. 2016-09 was a decrease of tax expense by $253 thousand and $145 thousand, respectively, resulting in an increase of basic and diluted earnings per share by approximately a $0.01, for each of the periods. The Company is estimating forfeitures, rather than accounting for forfeitures, as they occur. Reported stock-based compensation expense was classified as follows (in thousands): Three months ended March 31, 2019 2018 Casino $ 46 $ 38 Food and beverage 50 38 Hotel 21 10 Selling, general and administrative 798 480 Total stock-based compensation, before taxes 915 566 Tax benefit (192) (119) Total stock-based compensation, net of tax $ 723 $ 447 |
EARNINGS PER SHARE
EARNINGS PER SHARE | 3 Months Ended |
Mar. 31, 2019 | |
EARNINGS PER SHARE | |
EARNINGS PER SHARE | NOTE 4. EARNINGS PER SHARE Basic earnings per share is computed by dividing reported net earnings by the weighted-average number of common shares outstanding during the period. Diluted earnings per share reflect the additional dilution for all potentially dilutive securities such as stock options. The following is a reconciliation of the number of shares (denominator) used in the basic and diluted earnings per share computations (shares in thousands): Three months ended March 31, 2019 2018 Per Share Per Share Shares Amount Shares Amount Basic 17,937 $ 0.39 17,770 $ 0.38 Effect of dilutive stock options 682 (0.01) 940 (0.02) Diluted 18,619 $ 0.38 18,710 $ 0.36 Excluded from the computation of diluted earnings per share are options where the exercise prices are greater than the market price as their effects would be anti-dilutive in the computation of diluted earnings per share. For the three months ended March 31, 2019 and 2018, options for approximately 725 thousand and 236 thousand shares, respectively, were excluded from the computation. |
NEW ACCOUNTING PRONOUNCEMENTS
NEW ACCOUNTING PRONOUNCEMENTS | 3 Months Ended |
Mar. 31, 2019 | |
NEW ACCOUNTING PRONOUNCEMENTS | |
NEW ACCOUNTING PRONOUNCEMENTS | NOTE 5. NEW ACCOUNTING PRONOUNCEMENTS In August 2018, the FASB issued an ASU to align the requirements for capitalizing implementation costs incurred in a hosting arrangement with the requirements for capitalizing implementation costs incurred to develop or obtain internal-use software. The implementation costs incurred in a hosting arrangement that is a service contract should be presented as a prepaid asset in the balance sheet and expensed over the term of the hosting arrangement to the same line item in the statement of income as the costs related to the hosting fees. The guidance in this ASU is effective for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years, and early adoption is permitted including adoption in any interim period. The amendments should be applied either retrospectively or prospectively to all implementation costs incurred after adoption. The Company is currently assessing the impact the adoption of this standard will have on its Consolidated Financial Statements. In January 2017, the FASB issued an ASU that simplifies the accounting for goodwill impairment for all entities by eliminating the requirement to calculate the implied fair value of goodwill (i.e., Step 2 of today’s goodwill impairment test) to measure a goodwill impairment charge. Instead, entities will record an impairment charge based on the excess of a reporting unit’s carrying amount over its fair value (i.e., measure the charge based on today’s Step 1). The standard does not change the guidance on completing Step 1 of the goodwill impairment test. An entity will still be able to perform today’s optional qualitative goodwill impairment assessment before determining whether to proceed to Step 1. The standard will be applied prospectively and is effective for annual and interim impairment tests performed in periods beginning after December 15, 2019. Early adoption is allowed for all entities as of January 1, 2017, for annual and any interim impairment tests occurring after January 1, 2017. In February 2016, the FASB issued an ASU, amended January 2017, which addresses the recognition and measurement of leases. Under the new guidance, for all leases (with the exception of short-term leases), at the commencement date, lessees will be required to recognize a lease liability, which is a lessee’s obligation to make lease payments arising from a lease, measured on a discounted basis, and a right-of-use asset, which is an asset that represents the lessee’s right to use, or control the use of, a specified asset for the lease term. Under the new guidance, lessor accounting is largely unchanged. Further, the new lease guidance simplifies the accounting for sale and leaseback transactions primarily because lessees must recognize lease assets and liabilities, which no longer provides a source for off- balance sheet financing. The standard permits two approaches, one requiring retrospective application of the new guidance with restatement of prior years, and one requiring prospective application of the new guidance. In July 2018, the FASB issued ASU 2018-11, Leases (Topic 842) Targeted Improvements, amending certain aspects of the new leasing standard. The amendment allows an additional optional transition method whereby an entity records a cumulative effect adjustment to opening retained earnings in the year of adoption without restating prior periods. We adopted this standard as of the first quarter of 2019. See NOTE 2. ACCOUNTING FOR LEASES. A variety of proposed or otherwise potential accounting standards are currently under review and study by standard-setting organizations and certain regulatory agencies. Because of the tentative and preliminary nature of such proposed standards, we have not yet determined the effect, if any, the implementation of any such proposed or revised standards would have on the Company’s Consolidated Financial Statements. |
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS | 3 Months Ended |
Mar. 31, 2019 | |
RELATED PARTY TRANSACTIONS | |
RELATED PARTY TRANSACTIONS | NOTE 6. RELATED PARTY TRANSACTIONS The shopping center adjacent to the Atlantis (the “Shopping Center”) is owned by Biggest Little Investments, L.P. (“BLI”). John Farahi and Bob Farahi, Co-Chairmen of the Board and executive officers of the Company, and Ben Farahi are the three largest stockholders (the “Farahi Family Stockholders”) of Monarch and each also beneficially owns limited partnership interests in BLI. Maxum LLC is the sole general partner of BLI, and Ben Farahi is the sole managing member of Maxum LLC. Neither John Farahi nor Bob Farahi has any management or operational control over BLI or the Shopping Center. Until May 2006, Ben Farahi held the positions of Co-Chairman of the Board, Secretary, Treasurer and Chief Financial Officer of the Company. On August 28, 2015, Monarch, through its subsidiary Golden Road, entered into a 20-year lease agreement with BLI for a portion of the Shopping Center, consisting of an approximate 46,000 square-foot commercial building on approximately 4.2 acres of land adjacent to the Atlantis (the “Parking Lot Lease”). This lease gives the Atlantis the right to use a parcel, approximately 4.2 acres, comprised of a commercial building and surrounding land adjacent to the Atlantis. The primary purpose of the Parking Lot Lease is to provide additional, convenient, Atlantis surface parking. The Company demolished the commercial building and converted the land into approximately 300 additional surface parking spaces for the Atlantis. The minimum annual rent under the Parking Lot Lease is $695 thousand, commencing on November 17, 2015. The minimum annual rent is subject to a cost of living adjustment increase on each five-year anniversary. In addition, the Company is responsible for payment of property taxes, utilities and maintenance expenses related to the leased property. The Company has an option to renew the Parking Lot Lease for an additional 10-year term. If the Company elects not to exercise its renewal option, the Company will be obligated to pay BLI $1.6 million. For each of the three-month periods ended March 31, 2019 and 2018, the Company paid $174 thousand in rent, plus $12 thousand and $8 thousand, respectively, in operating expenses relating to this lease. The right of use asset and lease liability balances as of March 31, 2019, recognized in the Consolidated Balance Sheet, was $10.9 million. In addition, the Atlantis shares a driveway with the Shopping Center and leases approximately 37,400 square feet from BLI (the “Driveway Lease”) for an initial lease term of 15 years, which commenced on September 30, 2004, at an original annual rent of $300 thousand plus common area expenses. The annual rent of the Driveway Lease is subject to a cost of living adjustment increase on each five-year anniversary of the Driveway Lease. The total cost of the improvements was $2.0 million of which $1.35 million was paid by the Company. The cost of the driveway improvements is being depreciated over the 15-year expected economic life of the asset; some components of the driveway were depreciated over a shorter period of time. Effective August 28, 2015, in connection with the Company entering into the Parking Lot Lease, the Driveway Lease was amended to: (i) make the Company solely responsible for the operation and maintenance costs of the shared driveway (including the fountains thereon); (ii) eliminate the Company’s obligation to reimburse the Shopping Center for its proportionate share of common area expenses; and (iii) exercise the three successive five-year renewal terms beyond the initial 15 year term in the existing Driveway Lease agreement. At the end of the renewal terms, the Company has the option to purchase the leased driveway section of the Shopping Center. For each of the three-month periods ended March 31, 2019 and 2018, the Company paid $94 thousand in rent, plus $9 thousand and $5 thousand, respectively, in operating expenses relating to this lease. The right of use asset and lease liability balances as of March 31, 2019, recognized in the Consolidated Balance Sheet, was $4.3 million. We occasionally lease billboard advertising, storage space and parking lot space from affiliates controlled by the Farahi Family Stockholders and paid $36 thousand and $32 thousand, respectively, for the three-month periods ended March 31, 2019 and 2018, for such leases. |
LONG-TERM DEBT
LONG-TERM DEBT | 3 Months Ended |
Mar. 31, 2019 | |
LONG-TERM DEBT | |
LONG-TERM DEBT | NOTE 7. LONG-TERM DEBT On July 20, 2016, the Company entered into an amended and restated credit facility agreement (the “Amended Credit Facility”), under which our former $100.0 million credit facility (under which as of June 30, 2016 the borrowing capacity had been reduced to $45.5 million as a result of $19.5 million in mandatory reductions pursuant to the agreement and $35.0 million in voluntary reductions, as allowed by the agreement) was increased to $250.0 million, and the maturity date was extended from November 15, 2016 to July 20, 2021. As of March 31, 2019, the Company had an outstanding principal balance of $110.5 million under the Amended Credit Facility, a $0.6 million Standby Letter of Credit and $138.9 million remaining in available borrowings of the $250.0 million maximum principal available under the Amended Credit Facility. As of March 31, 2019, there have been no withdrawals from the Standby Letter of Credit. The total revolving loan commitment under the Amended Credit Facility will be automatically and permanently reduced to $50.0 million in the first full quarter after completion of the expansion project at the Monarch Casino Black Hawk (the “Monarch Black Hawk Expansion”) and all then outstanding revolving loans up to $200.0 million under the Amended Credit Facility will be converted to a term loan at such time. We may be required to prepay borrowings under the Amended Credit Facility no later than December 31, 2019 using excess cash flows depending on our leverage ratio. We have an option to permanently reduce the maximum revolving available credit at any time so long as the amount of such reduction is at least $0.5 million and in multiples of $50 thousand. Borrowings are secured by liens on substantially all of the Company’s real and personal property. In addition to other customary covenants for a facility of this nature, as of March 31, 2019, we are required to maintain a Total Leverage Ratio (Total Funded Debt divided by EBITDA, as defined in the Amended Credit Facility) of no more than 4.75:1 and a Fixed Charge Coverage Ratio (EBITDA divided by Fixed Charges, as defined in the Amended Credit Facility) of at least 1.15:1. As of March 31, 2019, the Company’s Total Leverage Ratio and Fixed Charge Coverage Ratio were 1.8:1 and 15.5:1, respectively. The interest rate under the Amended Credit Facility is LIBOR plus a margin ranging from 1.00% to 2.50%, or a base rate (as defined in the Amended Credit Facility) plus a margin ranging from 0.00% to 1.50%, or the Prime Rate. The applicable margins will vary depending on our leverage ratio. Commitment fees are equal to the daily average unused revolving commitment multiplied by the commitment fee percentage, ranging from 0.175% to 0.45%, based on our leverage ratio. At March 31, 2019, our interest rate was based on LIBOR and our leverage ratio was such that pricing for borrowings under the Amended Credit Facility was LIBOR plus 1.25%. At March 31, 2019, the one-month LIBOR interest rate was 2.50%. The carrying value of the debt outstanding under the Amended Credit Facility approximates fair value because the interest fluctuates with the lender’s prime rate or other market rates of interest. We may prepay borrowings under the Amended Credit Facility without penalty (subject to certain charges applicable to the prepayment of LIBOR borrowings prior to the end of the applicable interest period). Amounts prepaid may be re-borrowed so long as the total borrowings outstanding do not exceed the maximum principal available. We believe that our existing cash balances, cash flow from operations and borrowings available under the Amended Credit Facility will provide us with sufficient resources to fund our operations, meet our debt obligations, and fulfill our capital expenditure plans over the next twelve months; however, our operations are subject to financial, economic, competitive, regulatory, and other factors, many of which are beyond our control. If we are unable to generate sufficient cash flow or if our cash needs exceed our borrowing capacity under the Amended Credit Facility, we could be required to adopt one or more alternatives, such as reducing, delaying or eliminating planned capital expenditures, selling assets, restructuring debt or obtaining additional equity capital. |
TAXES
TAXES | 3 Months Ended |
Mar. 31, 2019 | |
TAXES | |
TAXES | NOTE 8. TAXES For the three months ended March 31, 2019 and 2018, the Company’s effective tax rate was 19.6% and 20.5%, respectively. The variation in the effective tax rate in the three-month periods of 2019 and 2018 is primarily attributable to the difference in the excess tax benefit on stock-based compensation. No uncertain tax positions were recorded as of March 31, 2019 and 2018. No change in uncertain tax positions is anticipated over the next twelve months. |
STOCK REPURCHASE PLAN
STOCK REPURCHASE PLAN | 3 Months Ended |
Mar. 31, 2019 | |
STOCK REPURCHASE PLAN | |
STOCK REPURCHASE PLAN | NOTE 9. STOCK REPURCHASE PLAN On October 22, 2014, the board of directors of Monarch authorized a stock repurchase plan (the “Repurchase Plan”). Under the Repurchase Plan, the board of directors authorized a program to repurchase up to 3,000,000 shares of the Company’s common stock in the open market or in privately negotiated transactions from time to time, in compliance with Rule 10b-18 of the Securities and Exchange Act of 1934, as amended, subject to market conditions, applicable legal requirements and other factors. The Repurchase Plan does not obligate the Company to acquire any particular amount of common stock and the plan may be suspended at any time at the Company’s discretion, and it will continue until exhausted. The actual timing, number and value of shares repurchased under the repurchase program will be determined by management at its discretion and will depend on a number of factors, including the market price of the Company’s stock, general market economic conditions and applicable legal requirements. The Company has made no purchases under the Repurchase Plan. |
SUMMARY OF SIGNIFICANT ACCOUN_2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 3 Months Ended |
Mar. 31, 2019 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
Basis of Presentation | Basis of Presentation : Monarch Casino & Resort, Inc. was incorporated in 1993. Unless otherwise indicated, “Monarch” and the “Company” refer to Monarch Casino & Resort, Inc. and its subsidiaries. Monarch owns and operates the Atlantis Casino Resort Spa, a hotel and casino in Reno, Nevada (the “Atlantis”) and Monarch Casino Black Hawk, a casino in Black Hawk, Colorado. In addition, Monarch owns separate parcels of land located next to the Atlantis and a parcel of land with an industrial warehouse located between Denver, Colorado and Monarch Casino Black Hawk. Monarch also owns Chicago Dogs Eatery, Inc. and Monarch Promotional Association, both of which were formed in relation to licensure requirements for extended hours of liquor operation in Black Hawk, Colorado. The accompanying unaudited consolidated financial statements include the accounts of Monarch and its subsidiaries (the “Consolidated Financial Statements”). Intercompany balances and transactions are eliminated. |
Interim Financial Statements | Interim Financial Statements : The Consolidated Financial Statements have been prepared in accordance with U.S. generally accepted accounting principles (“U.S. GAAP”) for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for complete financial statements. In the opinion of the management of the Company, all adjustments considered necessary for a fair presentation are included. Operating results for the three months ended March 31, 2019 are not necessarily indicative of the results that may be expected for the year ending December 31, 2019. The balance sheet at December 31, 2018 has been derived from the audited consolidated financial statements of the Company at that date, but does not include all of the information and footnotes required by U.S. GAAP for complete financial statements. For further information, refer to the consolidated financial statements and footnotes thereto included in the Company’s annual report on Form 10-K for the year ended December 31, 2018. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments : The estimated fair value of the Company’s financial instruments has been determined by the Company, using available market information and valuation methodologies. However, considerable judgment is required to develop the estimates of fair value; thus, the estimates provided herein are not necessarily indicative of the amounts that the Company could realize in a current market exchange. The carrying amounts of cash, receivables, accounts payable and accrued expenses approximate fair value because of the short-term nature of these instruments. Additionally, the carrying value of our debt approximates fair value due to the variable nature of applicable interest rates and relatively short-term maturity. |
Debt Issuance Costs | Debt Issuance Costs: Costs incurred in connection with the issuance of long-term debt are capitalized and amortized to interest expense over the term of the related debt agreement. Loan issuance costs are included in “Other assets, net” on the Company’s consolidated balance sheets. As of March 31, 2019, loan issuance cost, net of amortization was $1.2 million. |
Segment Reporting | Segment Reporting: The accounting guidance for disclosures about segments of an enterprise and related information requires separate financial information to be disclosed for all operating segments of a business. Accounting Standards Codification (“ASC”) 280 allows individual operating segments to be aggregated for reporting purposes if certain criteria are met. The Company determined that the Company’s two operating segments, Atlantis and Monarch Casino Black Hawk, meet all of the aggregation criteria stipulated by ASC 280-10-50-11. The Company views each property as an operating segment and the two operating segments have been aggregated into one reporting segment. |
Inventories | Inventories Inventories, consisting primarily of food, beverages, and retail merchandise, are stated at the lower of cost and net realizable value. Cost is determined based on the weighted average, which approximates a first-in, first-out method. |
Capitalized Interest | Capitalized Interest The Company capitalizes interest costs associated with debt incurred in connection with major construction projects. When no debt is specifically identified as being incurred in connection with a construction project, the Company capitalizes interest on amounts expended on the project at the Company’s average borrowing cost. Interest capitalization is ceased when the project is substantially complete. The Company capitalized $1.2 million during the quarter ended March 31, 2019. |
Revenues Recognition | Revenue Recognition The majority of the Company’s revenue is recognized when products are delivered or services are performed. For certain revenue transactions (when a patron uses a club loyalty card), in accordance with accounting standard update No. 2014-09 (“ASC 606”), a portion of the revenue is deferred until the points earned by the patron are redeemed or expire. Casino revenue: Casino revenues represent the net win from gaming activity, which is the difference between the amounts won and lost, which represents the transaction price. Jackpots, other than the incremental amount of progressive jackpots, are recognized at the time they are won by customers. Funds deposited by customers in advance and outstanding chips and slot tickets in the customers’ possession are recognized as a liability until such amounts are redeemed or used in gaming play by the customer. Additionally, net win is reduced by the performance obligations for the players’ club program, progressive jackpots and any pre-arranged marker discounts. Progressive jackpot provisions are recognized in two components: 1) as wagers are made for the share of players’ wagers that are contributed to the progressive jackpot award, and 2) as jackpots are won for the portion of the progressive jackpot award contributed by us. Cash discounts and other cash incentives to guests related to gaming play are recorded as a reduction to gaming revenue. Players’ Club Program: The Company operates a players’ club program under which as players perform gaming activities they earn and accumulate points, which may be redeemed for a variety of goods and services. Given the significance of the players’ club program and the ability for members to bank such points based on their past play, we have determined that players’ club program points granted in conjunction with gaming activity constitute a material right and, as such, represent a performance obligation associated with the gaming contracts. At the time points are earned, we recognize deferred revenue at the standalone selling prices (SSP) of the goods and services that the points are expected to be redeemed for, with a corresponding decrease in gaming revenue. The points estimated SSP is computed as the cash redemption value of the points expected to be redeemed, which is determined through an analysis of all redemption activity over the preceding twelve-month period. As of March 31, 2019, we had estimated the obligations related to the players’ club program at $9.4 million, which is included in Accrued Expenses in the Liabilities and Stockholders’ Equity section in the Consolidated Balance Sheet. Pursuant to the new Financial Accounting Standards Board (“FASB”) guidelines, food and beverage, hotel and other complimentaries are now valued at their retail price and included as revenues within their respective categories, with a corresponding decrease in gaming revenues. In addition, the cost of providing these complimentary goods and services are now included as expenses within their respective categories, resulting in a corresponding decrease in casino expenses. Food and Beverage, Hotel and Other (retail) Revenues: Food and Beverage, Hotel and Other Revenues in general are recognized when products are delivered or services are performed. We recognize revenue related to the products and services associated to the players points’ redemptions at the time products are delivered or services are performed, with corresponding reduction in the deferred revenue, at SSP. Other complimentaries in conjunction with the gaming and other business are also valued at SSP. Hotel revenue is presented net of non-third-party rebate and commission. Other Revenues : Other revenues (excluding retail) primarily consist of commissions received on ATM transactions and cash advances, which are recorded on a net basis as the Company represents the agent in its relationship with the third-party service providers, and commissions and fees received in connection with pari-mutuel wagering, which are also recorded on a net basis. Sales and other taxes : Sales taxes and other taxes collected from customers on behalf of governmental authorities are accounted for on a net basis and are not included in revenues or operating expenses. In addition, tips and other gratuities, excluding service charges, collected from customers on behalf of our employees are also accounted for on a net basis and are not included in revenues or operating expenses. |
ACCOUNTING FOR LEASES (Tables)
ACCOUNTING FOR LEASES (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
ACCOUNTING FOR LEASES | |
Schedule of information related to the lease costs | The table below presents information related to the lease costs for operating leases during 2019 (in thousands): Three months ended March 31, 2019 Short-term lease cost $ 88 Long-term lease cost 371 Total lease cost $ 459 |
Schedule of future minimum lease payments | Following is the undiscounted cash flow for the nine months of the current year, for each of the next four years and total of the remaining years to the operating lease liabilities recorded on the balance sheet (in thousands): Operating Leases Year ending December 31, 2019 $ 1,104 2020 1,446 2021 1,432 2022 1,078 2023 1,071 Thereafter 19,084 Total minimum lease payments 25,215 Less: amount of lease payment representing interest (9,037) Present value of future minimum payments 16,178 Less: current obligations under leases (796) Long-term lease obligations $ 15,382 |
STOCK-BASED COMPENSATION (Table
STOCK-BASED COMPENSATION (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
STOCK-BASED COMPENSATION. | |
Schedule of stock-based compensation expense | Reported stock-based compensation expense was classified as follows (in thousands): Three months ended March 31, 2019 2018 Casino $ 46 $ 38 Food and beverage 50 38 Hotel 21 10 Selling, general and administrative 798 480 Total stock-based compensation, before taxes 915 566 Tax benefit (192) (119) Total stock-based compensation, net of tax $ 723 $ 447 |
EARNINGS PER SHARE (Tables)
EARNINGS PER SHARE (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
EARNINGS PER SHARE | |
Schedule of reconciliation of the number of shares (denominator) used in the basic and diluted earnings per share computations | Three months ended March 31, 2019 2018 Per Share Per Share Shares Amount Shares Amount Basic 17,937 $ 0.39 17,770 $ 0.38 Effect of dilutive stock options 682 (0.01) 940 (0.02) Diluted 18,619 $ 0.38 18,710 $ 0.36 |
SUMMARY OF SIGNIFICANT ACCOUN_3
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Segment Reporting (Details) | 3 Months Ended |
Mar. 31, 2019segment | |
Segment Reporting | |
Number of operating segments | 2 |
Number of reportable segments | 1 |
SUMMARY OF SIGNIFICANT ACCOUN_4
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Debt Issuance Costs and Capitalized Interest (Details) $ in Millions | 3 Months Ended |
Mar. 31, 2019USD ($) | |
Capitalized Interest | |
Capitalized interest | $ 1.2 |
Other assets, net | |
Debt Issuance Costs | |
Loan issuance costs, net of amortization | $ 1.2 |
SUMMARY OF SIGNIFICANT ACCOUN_5
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Revenue Recognition (Details) - USD ($) $ in Thousands | Mar. 31, 2019 | Dec. 31, 2018 |
Accrued expenses | $ 29,574 | $ 31,111 |
Players Club Program | ASU 2014-09 | ||
Accrued expenses | $ 9,400 |
ACCOUNTING FOR LEASES - Narrati
ACCOUNTING FOR LEASES - Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Jan. 01, 2019 | |
Lease terms | ||
Right of use asset | $ 16,175 | |
short term lease liability | 796 | |
Long-term lease liability | $ 15,382 | |
Lease, Practical Expedients, Package [true false] | true | |
Lease, Practical Expedient, Lessor Single Lease Component [true false] | true | |
Weighted-average discount rate | 4.32% | |
weighted-average remaining lease term | 22 years 22 days | |
Lease rent paid | $ 368 | |
ASU 2016-02 | Transition adjustment | ||
Lease terms | ||
Right of use asset | $ 16,400 | |
short term lease liability | 900 | |
Long-term lease liability | $ 15,500 |
ACCOUNTING FOR LEASES - Lease c
ACCOUNTING FOR LEASES - Lease costs (Details) $ in Thousands | 3 Months Ended |
Mar. 31, 2019USD ($) | |
ACCOUNTING FOR LEASES | |
Short-term lease cost | $ 88 |
Long-term lease cost | 371 |
Total lease cost | $ 459 |
ACCOUNTING FOR LEASES - Undisco
ACCOUNTING FOR LEASES - Undiscounted cash flow operating lease liability (Details) $ in Thousands | Mar. 31, 2019USD ($) |
ACCOUNTING FOR LEASES | |
2019 | $ 1,104 |
2020 | 1,446 |
2021 | 1,432 |
2022 | 1,078 |
2023 | 1,071 |
Thereafter | 19,084 |
Total minimum lease payments | 25,215 |
Less: amount of lease payment representing interest | (9,037) |
Present value of future minimum payments | 16,178 |
Less: current obligations under leases | (796) |
Long-term lease obligations | $ 15,382 |
STOCK-BASED COMPENSATION - Adop
STOCK-BASED COMPENSATION - Adoption of ASU No. 2016-09 (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Prospective adoption | ||
Provision for income taxes | $ (1,706) | $ (1,736) |
ASU 2016-09 | ||
Prospective adoption | ||
Provision for income taxes | $ 253 | $ 145 |
Increase of basic and diluted earnings per share | $ 0.01 | $ 0.01 |
STOCK-BASED COMPENSATION - Repo
STOCK-BASED COMPENSATION - Reported Expense (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Stock-based compensation expense | ||
Total stock-based compensation, before taxes | $ 915 | $ 566 |
Tax benefit | (192) | (119) |
Total stock-based compensation, net of tax | 723 | 447 |
Casino | ||
Stock-based compensation expense | ||
Total stock-based compensation, before taxes | 46 | 38 |
Food and beverage | ||
Stock-based compensation expense | ||
Total stock-based compensation, before taxes | 50 | 38 |
Hotel | ||
Stock-based compensation expense | ||
Total stock-based compensation, before taxes | 21 | 10 |
Selling, general and administrative | ||
Stock-based compensation expense | ||
Total stock-based compensation, before taxes | $ 798 | $ 480 |
EARNINGS PER SHARE - (Details)
EARNINGS PER SHARE - (Details) - $ / shares shares in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Shares | ||
Basic (in shares) | 17,937 | 17,770 |
Effect of dilutive stock options (in shares) | 682 | 940 |
Diluted (in shares) | 18,619 | 18,710 |
Per Share Amount | ||
Basic (in dollars per share) | $ 0.39 | $ 0.38 |
Effect of dilutive stock options (in dollars per share) | (0.01) | (0.02) |
Diluted (in dollars per share) | $ 0.38 | $ 0.36 |
EARNINGS PER SHARE - Anti-dilut
EARNINGS PER SHARE - Anti-dilutive Options (Details) - shares shares in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Stock options | ||
Anti-dilutive securities | ||
Anti-dilutive securities excluded from the computation of diluted earnings per share (in shares) | 725 | 236 |
RELATED PARTY TRANSACTIONS (Det
RELATED PARTY TRANSACTIONS (Details) $ in Thousands | Aug. 28, 2015USD ($)ft²aitem | Sep. 30, 2004USD ($) | Mar. 31, 2019USD ($)ft² | Mar. 31, 2018USD ($) | Nov. 17, 2015USD ($) |
RELATED PARTY TRANSACTIONS | |||||
Lease rent paid | $ 368 | ||||
Right of use asset | 16,175 | ||||
Operating lease liability | 16,178 | ||||
Driveway Lease | |||||
RELATED PARTY TRANSACTIONS | |||||
Operating expenses related to lease | $ 1,350 | ||||
Biggest Little Investments, L.P. (BLI) | Parking Lot Lease | |||||
RELATED PARTY TRANSACTIONS | |||||
Number of parking spaces | item | 300 | ||||
Minimum annual rent | $ 695 | ||||
Anniversary years subject to cost of living adjustment rent increases | 5 years | ||||
Lease renewal option additional term | 10 years | ||||
Amount due to related party if lease is not renewed | $ 1,600 | ||||
Lease rent paid | 174 | ||||
Lease rent paid | $ 174 | ||||
Operating expenses related to lease | 12 | ||||
Operating expenses related to lease | 8 | ||||
Right of use asset | $ 10,900 | ||||
Biggest Little Investments, L.P. (BLI) | Driveway Lease | |||||
RELATED PARTY TRANSACTIONS | |||||
Lease term | 15 years | ||||
Area of property | ft² | 37,400 | ||||
Minimum annual rent | $ 300 | ||||
Anniversary years subject to cost of living adjustment rent increases | 5 years | ||||
Number of terms for which the lease can be renewed | item | 3 | ||||
Lease renewal option additional term | 5 years | ||||
Cost of improvements, useful life | 15 years | ||||
Lease rent paid | $ 94 | ||||
Lease rent paid | 94 | 94 | |||
Operating expenses related to lease | 9 | ||||
Operating expenses related to lease | $ 2,000 | 5 | |||
Right of use asset | 4,300 | ||||
Operating lease liability | 4,300 | ||||
Affiliates | Billboard advertising, storage space and parking lot space | |||||
RELATED PARTY TRANSACTIONS | |||||
Lease rent paid | $ 36 | ||||
Lease rent paid | $ 32 | ||||
Golden Road | Biggest Little Investments, L.P. (BLI) | Parking Lot Lease | |||||
RELATED PARTY TRANSACTIONS | |||||
Lease term | 20 years | ||||
Golden Road | Biggest Little Investments, L.P. (BLI) | Parking Lot Lease | Buildings | |||||
RELATED PARTY TRANSACTIONS | |||||
Area of property | ft² | 46,000 | ||||
Area of land | a | 4.2 |
LONG-TERM DEBT (Details)
LONG-TERM DEBT (Details) | 3 Months Ended | ||
Mar. 31, 2019USD ($) | Jul. 20, 2016USD ($) | Jun. 30, 2016USD ($) | |
Amended Credit Facility, July 20, 2021 | |||
Long-term debt | |||
Maximum borrowing capacity | $ 250,000,000 | $ 250,000,000 | |
Remaining available borrowings | 138,900,000 | ||
Amount in which the maximum borrowing capacity can be permanently reduced | 500,000 | ||
Multiple which may be used to permanently reduce the maximum borrowing capacity under the credit facility | $ 50,000 | ||
Total leverage ratio | 1.8 | ||
Amended Credit Facility, July 20, 2021 | Completion of expansion project at Monarch Casino Black Hawk | |||
Long-term debt | |||
Maximum borrowing capacity | $ 50,000,000 | ||
Amended Credit Facility, July 20, 2021 | LIBOR | |||
Long-term debt | |||
Margin added to variable rate (as a percent) | 1.25% | ||
Variable interest rate (as a percent) | 2.50% | ||
Amended Credit Facility, July 20, 2021 | Minimum | |||
Long-term debt | |||
Fixed charge coverage ratio | 1.15 | ||
Commitment fee as a percentage of daily average unused revolving commitment | 0.175% | ||
Amended Credit Facility, July 20, 2021 | Minimum | LIBOR | |||
Long-term debt | |||
Margin added to variable rate (as a percent) | 1.00% | ||
Amended Credit Facility, July 20, 2021 | Minimum | Base Rate | |||
Long-term debt | |||
Margin added to variable rate (as a percent) | 0.00% | ||
Amended Credit Facility, July 20, 2021 | Maximum | |||
Long-term debt | |||
Total leverage ratio | 4.75 | ||
Commitment fee as a percentage of daily average unused revolving commitment | 0.45% | ||
Amended Credit Facility, July 20, 2021 | Maximum | Completion of expansion project at Monarch Casino Black Hawk | |||
Long-term debt | |||
Face amount of debt | $ 200,000,000 | ||
Amended Credit Facility, July 20, 2021 | Maximum | LIBOR | |||
Long-term debt | |||
Margin added to variable rate (as a percent) | 2.50% | ||
Amended Credit Facility, July 20, 2021 | Maximum | Base Rate | |||
Long-term debt | |||
Margin added to variable rate (as a percent) | 1.50% | ||
Credit facility, November 15, 2016 | |||
Long-term debt | |||
Maximum borrowing capacity | $ 100,000,000 | ||
Current borrowing capacity | 45,500,000 | ||
Mandatory reductions in borrowing capacity | 19,500,000 | ||
Voluntary reductions in borrowing capacity | $ 35,000,000 | ||
Amended Credit Facility, July 20, 2021 | Amended Credit Facility, July 20, 2021 | |||
Long-term debt | |||
Amount outstanding | $ 110,500,000 | ||
Standby Letter of Credit | |||
Long-term debt | |||
Amount outstanding | 600,000 | ||
Standby Letter of Credit | Amended Credit Facility, July 20, 2021 | |||
Long-term debt | |||
Amount drawn under the facility | $ 0 |
TAXES (Details)
TAXES (Details) | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
TAXES | ||
Effective tax rate (as a percent) | 19.60% | 20.50% |
TAXES - Unrecognized Tax Benefi
TAXES - Unrecognized Tax Benefits (Details) - USD ($) $ in Millions | Mar. 31, 2019 | Mar. 31, 2018 |
TAXES | ||
Liability for uncertain tax positions recorded | $ 0 | $ 0 |
Change in uncertain tax positions, increase | 0 | |
Change in uncertain tax positions, decrease | $ 0 |
STOCK REPURCHASE PLAN (Details)
STOCK REPURCHASE PLAN (Details) - Repurchase Plan - shares | 3 Months Ended | |
Mar. 31, 2019 | Oct. 22, 2014 | |
Stock repurchase plan | ||
Shares authorized for repurchase under program | 3,000,000 | |
Stock repurchases made | 0 |