Golden Entertainment reported a 16.5 percent increase in net revenues in its second-quarter earnings statement Wednesday evening.
The Las Vegas-based company posted second-quarter revenues of $102.6 million, a noteworthy year-over-year jump from the $88 million in combined revenues earned in the same period in 2015 by Sartini Gaming and Lakes Entertainment – which merged to form Golden Entertainment last July.
“As we approach the one year anniversary of the merger, we are well positioned to continue our strategic approach to building shareholder value,” said Blake L. Sartini, Chief Executive Officer of Golden Entertainment on a conference call with investors and analysts. “In the last quarter, we saw continued economic strength in all three jurisdictions in which we operate.”
Net income for the quarter checked in at $2.8 million and $0.12 per share, compared to a net loss of $0.2 million – or $0.01 per share – in the prior year quarter. Adjusted EBITDA – earnings before interest, taxes, depreciation and amortization – checked in at a $13.3 million, up from $11.9 million year-over-year. The company attributed these increases to last year’s merger and to successful growth strategy implementation.
“By all measures we made significant progress during the second quarter. Our net revenues and Adjusted EBITDA were up 16.5% and 12.2%, respectively, driven by a combination of organic and external growth,” Sartini said. “During the quarter our distributed gaming net revenues increased 23.2% compared to the combined net revenues from the prior year quarter, and we continue to see real potential for growth.”
Sartini attributed the strong performance to increased same-store play at Golden’s Las Vegas-area tavern and supermarket locations, which realized a 9.3 percent year-over-year boost in revenues. After opening two more tavern locations last quarter, the company now boasts 51 total in Southern Nevada and expects to open two more by the end of 2016.
Golden’s two acquisitions in Montana earlier this year produced EBITDA largely as expected, and the company is moving forward with a $1.5 million upgrade to its Rocky Gap property in Maryland – a project that includes additional parking spaces, an upgrade to the hotel and new forms of floor games.
“We look at Rocky Gap as having significant upside opportunity,” Sartini said, adding that he expects a 30 percent return on capital invested at the property.
