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Colorado Springs, Colorado, March 15, 2010 – Century Casinos, Inc. (NASDAQ Capital Market® and Vienna Stock Exchange: CNTY) announced today its financial results for the three months and year ended December 31, 2009.
Fourth Quarter 2009
Amounts in thousands, except share data | | For the Three Months
Ended December 31, | | Consolidated Results: | | 2009 | | 2008 | % Change | Net operating revenue | $ | 12,131 | $ | 11,673 | 3.9% | Operating loss from continuing operations | | (9,027) | | (553) | NM | Loss from continuing operations | | (9,220) | | (1,873) | NM | Earnings from discontinued operations | | 1,582 | | 1,189 | 33.1% | Net loss | | (7,638) | | (684) | NM | Net loss attributable to Century Casinos, Inc. | | (7,638) | | (651) | NM | Adjusted EBITDA | | 1,725 | | 1,527 | 13.0% | | | | | | | Earnings per share: | | | | | | Loss from continuing operations | $ | (0.39) | $ | (0.08) | NM | Net loss | $ | (0.32) | $ | (0.03) | NM | | | | | | | Weighted-average common shares, basic and diluted | | 23,630,045 | | 23,524,067 | 0.5% |
For the fourth quarter of 2009, net operating revenue from continuing operations was $12.1 million and consolidated Adjusted EBITDA* was $1.7 million. This represents a 3.9% increase in net operating revenue from continuing operations over the same quarter of last year ($11.7 million in the fourth quarter of 2008) and a 13.0% increase in consolidated Adjusted EBITDA* ($1.5 million in the fourth quarter of 2008). Net operating revenue at the Edmonton, Alberta, Canada casino, as reported in U.S. dollars, was 13.9% higher than the same period in 2008. Management attributes the increase in net operating revenue in Edmonton to a 12.9% increase in the average exchange rate between the U.S. dollar and Canadian dollar in the fourth quarter of 2009 compared to the fourth quarter of 2008. In Canadian dollars, net operating revenue remained flat when compared to the prior year quarter. The increase in revenue at Edmonton was offset by decreased net operating revenue at the Company’s casino in Central City, Colorado. Management attributes most of the decline in revenue at the Company’s Central City casino to a competitor opening a new hotel in the market and overall difficult economic conditions.
Operating loss from continuing operations was $9.0 million in the fourth quarter of 2009 compared to operating losses from continuing operations of $0.6 million for the fourth quarter of 2008, primarily due to the write-down of our investment in Casinos Poland (“CPL”) by $9.0 million during the fourth quarter of 2009. Effective January 1, 2010, the gaming laws in Poland changed, increasing the gaming tax rate from 45% to 50% and now requiring all licensees to go through a renewal process once their current licenses have expired. Also, all slot arcades are now required to cease operations at the end of their current license period. As a result of these changes, the Company determined that its investment in Poland suffered a decline in value that was other than temporary. The Company recorded an impairment of $9.0 million in the value of CPL to bring the value of the Company’s investment in CPL in line with management’s estimate of CPL’s fair market value based on expectations of CPL’s future cash flows.
The Company reported a loss from continuing operations of $9.2 million, or $0.39 per share, for the fourth quarter of 2009, compared to a loss from continuing operations of $1.9 million, or $0.08 per share, for the fourth quarter of 2008. Partially offsetting the increase in operating loss from continuing operations was a decrease in interest expense of $0.7 million and an increase in foreign currency gains of $0.9 million when comparing the fourth quarter of 2009 to the fourth quarter of 2008. Adjusted for the one-time write-down of CPL and foreign currency transaction gains, the loss from continuing operations was $0.6 million*, or $0.03 per share, for the fourth quarter of 2009.
Including discontinued operations, the Company reported a net loss attributable to Century Casinos, Inc. and subsidiaries of $7.6 million, or $0.32 per share, for the fourth quarter of 2009. During the fourth quarter of 2009, the Company recorded a gain of $1.6 million that was previously deferred from the disposition of its South African casinos (“See Sale of CCA” below). The Company reported a net loss attributable to Century Casinos, Inc. and subsidiaries of $0.7 million, or $0.03 per share, for the fourth quarter of 2008.
Year ended December 31, 2009
Amounts in thousands, except share data | | For the Year
Ended December 31, | | Consolidated Results: | | 2009 | | 2008 | % Change | Net operating revenue | $ | 49,738 | $ | 53,042 | (6.2%) | Operating loss from continuing operations | | (8,370) | | (9,257) | 9.6% | Loss from continuing operations | | (12,903) | | (17,857) | 27.7% | Earnings from discontinued operations | | 24,722 | | 4,662 | NM | Net earnings (loss) | | 11,819 | | (13,195) | NM | Net earnings (loss) attributable to Century Casinos, Inc. | | 10,883 | | (13,473) | NM | Adjusted EBITDA | | 7,941 | | 8,377 | (5.2%) | | | | | | | Earnings per share: | | | | | | Loss from continuing operations | $ | (0.55) | $ | (0.76) | 27.6% | Net earnings (loss) | $ | 0.46 | $ | (0.57) | NM | | | | | | | Weighted-average common shares, basic and diluted | | 23,575,709 | | 23,455,351 | 0.5% |
For the year ended December 31, 2009, net operating revenue from continuing operations was $49.7 million and consolidated Adjusted EBITDA* was $7.9 million. This represents a 6.2% decrease in net operating revenue from continuing operations over 2008 ($53.0 million for the year ended December 31, 2008) and a 5.2% decrease in consolidated Adjusted EBITDA* ($8.4 million for the year ended December 31, 2008). This decrease is due to declines in net operating revenue at the Company’s properties in Colorado, resulting in a decrease in its Colorado casinos’ market share in the Cripple Creek and the Central City/Black Hawk market. In addition, net operating revenue in Edmonton, Alberta, Canada, as reported in U.S. dollars, was 7.3% lower than in 2008, but essentially comparable in Canadian dollars. The reported results were negatively affected by a 7.0% decrease in the average exchange rate between the U.S. dollar and Canadian dollar for the year ended December 31, 2009, compared to the year ended December 31, 2008.
Operating loss from continuing operations was $8.4 million for the year ended December 31, 2009 compared to an operating loss from continuing operations of $9.3 million for the year ended December 31, 2008. For the year ended December 31, 2009, the Company recorded a write-down of $9.0 million in the value of CPL. For the year ended December 31, 2008, the Company recorded goodwill impairments of $9.3 million related to its investments in Central City, Colorado and Cripple Creek, Colorado. Excluding these items, the Company had operating earnings from continuing operations of $0.6 million* and $0.1* million for the years ended December 31, 2009 and 2008, respectively. The increase in operating earnings from continuing operations (adjusted for the write-downs) is primarily due to a decrease in depreciation expense at the Company’s Colorado properties on a year-over-year basis. The Company substantially offset the decline in gaming revenue in 2009 by controlling its general and administrative expenses.
The Company reported a loss from continuing operations of $12.9 million, or $0.55 per share for the year ended December 31, 2009 and a loss from continuing operations of $17.9 million, or $0.76 per share, for 2008. In addition to the decrease in operating losses from continuing operations, the Company’s loss from continuing operations decreased due to the Company establishing a valuation allowance on its U.S. deferred taxes of approximately $6.0 million during the third quarter of 2008. The tax effect on subsequent net operating income or losses incurred in the U.S. reduces or increases this valuation allowance. The recording of the valuation allowance and the subsequent effect of not taking a tax benefit on U.S. losses has contributed to a $3.2 million decrease in our tax expense when comparing the year ended December 31, 2009 to the year ended December 31, 2008. The Company continues to not recognize tax benefits on operating losses incurred in the U.S. In addition to the decline in tax expense, foreign currency losses for 2009 declined by $0.4 million compared to the prior year. Adjusted for the write-down of the investment in CPL, the one-time write-off of deferred financing charges resulting from the early repayment of the Company’s Colorado third party debt (See “Sale of CCA” below) and foreign currency transaction losses, the loss from continuing operations was $2.9 million*, or $0.12 per share, for the year ended December 31, 2009.
Including discontinued operations, the Company reported net earnings attributable to Century Casinos, Inc. and subsidiaries of $10.9 million, or $0.46 per share, for the year ended December 31, 2009. During the year ended December 31, 2009, the Company reported a gain of $21.9 million, or $0.93 per share, on the disposition of Century Casinos Africa (“CCA”) and a gain of $915,000, or $0.04 per share, on the previously reported disposition of the Century Casino Millennium.
Sale of CCA
On December 19, 2008, the Company entered into an agreement to sell all of the outstanding shares of CCA for a gross selling price of ZAR 460.0 million ($59.4 million), less the balance of third party South African debt and other agreed-to amounts. CCA owned the Caledon Hotel, Spa & Casino and 60% of the Century Casino & Hotel in Newcastle, South Africa. The Company received total net proceeds of ZAR 373.2 million ($47.9 million) from the sale of CCA.
During the fourth quarter of 2009, the Company realized a previously deferred gain of $1.7 million resulting from the sale of CCA
With the proceeds from the sale of CCA, the Company repaid all of its third party debt in Colorado (approximately $15.9 million) and purchased the Silver Dollar Casino in Calgary, Alberta, Canada. In conjunction with the repayment of the third party debt in Colorado, the Company wrote off approximately $1.0 million in deferred finance charges.
Purchase of Silver Dollar Casino
On December 15, 2009, the Company announced that its subsidiary, Century Casinos Europe GmbH ("CCE"), entered into a definitive agreement to acquire 100% of the issued and outstanding shares of Frank Sisson's Silver Dollar Ltd. ("FSSD") and 100% of the issued and outstanding shares of EGC Properties Ltd. ("EGC") from Grant Thornton Limited, as receiver and manager of EGC Holdings Ltd. ("Holdings"), FSSD and EGC. Prior to the closing of the transaction, FSSD and EGC collectively owned and operated the Silver Dollar Casino ("Silver Dollar") and related land in Calgary.
The Silver Dollar is a 93,000 square-foot casino facility located on approximately seven acres of land in Calgary. The casino facility includes 504 slot machines, 16 table games, 25 video lottery terminals, two restaurants, a lounge, a 5,000 square-foot showroom, an 18,000 square-foot convention center and a 30-lane bowling alley.
The total consideration for the transaction was $10.7 million plus a working capital adjustment of $0.8 million, for a total of $11.5 million. The transaction closed on January 13, 2010.
Share Repurchases
In March 2000, the Company’s board of directors approved a discretionary program to repurchase up to $5.0 million of the Company’s outstanding common stock. In November 2009, the board of directors approved an increase of the amount available to be repurchased to $15.0 million under the repurchase program. The repurchase program has no set expiration or termination date. In December 2009, the Company repurchased 53,557 shares of common stock at a weighted average price of $2.43 per share.
Property Results (Continuing Operations)
The following discussion of the Company’s property results is for the fourth quarter of 2009 and 2008. For a discussion of year-over-year property results, please refer to the Company’s 2009 10-K filed with the Securities and Exchange Commission (“SEC”) on March 15, 2010.
Property Highlights | (Amounts in thousands) | | | | | | | | Net Operating Revenue | | Adjusted EBITDA* | | | For the Three Months
Ended December 31, | | For the Three Months
Ended December 31, | | | 2009 | | 2008 | | 2009 | | 2008 | Century Casino & Hotel, Edmonton | $ | 5,635 | $ | 4,948 | $ | 2,023 | $ | 1,658 | Womacks Casino & Hotel (Cripple Creek) | | 2,385 | | 2,416 | | 286 | | 338 | Century Casino & Hotel, Central City | | 3,604 | | 3,756 | | 775 | | 671 | Cruise Ships | | 507 | | 549 | | 102 | | 123 | Corporate | | - | | 4 | | (1,461) | | (1,263) | Consolidated net operating revenue | $ | 12,131 | $ | 11,673 | $ | 1,725 | $ | 1,527 | | | | | | | | | | Century Casino & Hotel (Edmonton, Alberta, Canada) – Net operating revenue at the Century Casino & Hotel in Edmonton increased by 13.9% to $5.6 million for the fourth quarter of 2009 compared to $4.9 million for the fourth quarter of 2008, primarily due to a 12.9% increase in the average exchange rate between the U.S. dollar and the Canadian dollar. In Canadian dollars, net operating revenue in the fourth quarter of 2009 remained flat at CAD 6.0 million compared to the prior year quarter. Declines in gaming revenue (reported in Canadian dollars) were offset by an increase in hotel, food and beverage revenue, particularly due to increased activity at the property’s showroom. Management believes that revenue at the Edmonton casino was negatively impacted by a slow economy and that road construction in front of the casino during a portion of 2009 adversely affected access to the casino. The construction ended in the first week of November 2009.
Adjusted EBITDA* was $2.0 million for the fourth quarter of 2009, an increase of 22.0% from $1.7 million for the fourth quarter of 2008, which management attributes primarily to the favorable exchange rate. In Canadian dollars, Adjusted EBITDA* increased by 6.4% to CAD 2.1 million for the three months ended December 31, 2009 from CAD 2.0 million for the three months ended December 31, 2008, which management attributes to the increased hotel, food and beverage revenue.
Womacks Casino (Cripple Creek, Colorado, USA) – Net operating revenue at Womacks Casino in Cripple Creek, Colorado for the fourth quarter of 2009 remained flat at $2.4 million compared to the prior year quarter. A 3.1% increase in gaming revenue was offset by a comparable decrease in hotel, food and beverage revenue. On July 2, 2009, gaming establishments in Colorado were permitted to raise the maximum betting limit to $100, be open for 24 hours and have roulette and craps tables. The Company has implemented these changes at its Colorado casinos. Management believes that any benefit achieved from the change in gaming laws was offset by the continued slow economy. The Cripple Creek gaming market as a whole increased by 2.2% during the fourth quarter of 2009. Womacks’ Adjusted EBITDA* for both the fourth quarter of 2009 and the fourth quarter of 2008 was $0.3 million, primarily due to flat revenue on a year over year basis and continued cost control.
Century Casino and Hotel (Central City, Colorado, USA) – Net operating revenue at the Century Casino and Hotel in Central City decreased 4.0% to $3.6 million for the fourth quarter of 2009 compared to $3.8 million for the fourth quarter of 2008. The combined Central City/Black Hawk gaming market as a whole increased 13.1%. The Company’s share of Central City/Black Hawk gaming revenue decreased from 3.2% for the three months ended December 31, 2008 to 2.7% for the three months ended December 31, 2009. During the fourth quarter 2009, our largest competitor in the market opened a 536-room hotel with pool and spa facilities in which they invested approximately $235 million. Management believes that this negatively impacted Century Casino and Hotel’s revenue. Adjusted EBITDA* for the Century Casino and Hotel in Central City for the fourth quarter of 2009 increased by 15.5% to $0.8 million compared to $0.7 million in the fourth quarter of 2008. The increase is primarily due to a decline in property taxes for which we reduced our property tax accrual by $0.2 million during the fourth quarter 2009.
The Company expects that in 2010 a new casino will open across from its casino in Central City. Management believes that this casino will have approximately 200 slot machines, 5 table games, a video poker sports bar and a banquet room, and will provide further competition to the Company’s casino in Central City.
Cruise Ships – The Company’s ship-based casinos contributed net operating revenue of $0.5 million and Adjusted EBITDA* of $0.1 million for each of the fourth quarters of 2009 and 2008.
Corporate – Corporate operations reported negative Adjusted EBITDA* of $1.5 million for the fourth quarter of 2009 compared to negative Adjusted EBITDA* of $1.3 million for the fourth quarter of 2008. The lower negative Adjusted EBITDA* is primarily due to an increase in our bonus compensation awards of $0.2 million when comparing the fourth quarter of 2009 to the fourth quarter of 2008.
Liquidity
Cash and cash equivalents totaled $37.0 million at December 31, 2009 and the Company had working capital (current assets minus current liabilities) of $28.6 million. During 2009, the Company received net cash of $47.9 million and net cash of $1.6 million from the sales of its casinos in South Africa and the Czech Republic, respectively. With the proceeds from these sales and from its operations, the Company repaid $24.6 million of its debt during 2009.
Subsequent to December 31, 2009, the Company has paid $10.5 million towards its acquisition of the Silver Dollar Casino in Calgary. In the second quarter of 2010, the Company expects to close on the purchase of land in Cripple Creek, Colorado to be used as a parking lot. The expected cost to purchase the land is $2.2 million.
The Company will post a copy of its 2009 Form 10-K filed with the SEC on its website at www.cnty.com/corporate/investor/sec-filings/ on Monday, March 15, 2010.
Century Casinos will host its Q4 2009 Earnings Conference Call today at 8:30 am MST; 3:30 pm CET, respectively. U.S. domestic participants please dial +1-800-894-5910; all other international participants please use +1-785-424-1052 to dial in. Participants may also listen to the call live or obtain a recording of the call on our website at www.cnty.com/corporate/investor/financial-results/.
(continued)
CENTURY CASINOS, INC. AND SUBSIDIARIES
SUPPLEMENTAL INFORMATION
Century Casinos, Inc. | | Condensed Consolidated Statements of (Loss) Earnings (Unaudited) | | (Amounts in thousands, except for share information) | | | | | | | | | | For the Three Months
Ended December 31, | | For the Year
Ended December 31, | | | | 2009 | | 2008 | | 2009 | | 2008 | Operating revenue: | | | | | | | | Gaming | $ | 11,082 | $ | 10,841 | $ | 46,496 | $ | 49,949 | | Hotel, food and beverage | | 2,202 | | 2,075 | | 8,417 | | 8,669 | | Other | | 519 | | 466 | | 1,914 | | 1,935 | | Gross revenue | | 13,803 | | 13,382 | | 56,827 | | 60,553 | | Less promotional allowances | | 1,672 | | 1,709 | | 7,089 | | 7,511 | | Net operating revenue | | 12,131 | | 11,673 | | 49,738 | | 53,042 | | | | | | | | | | | Operating costs and expenses: | | | | | | | | | | Gaming | | 4,814 | | 4,651 | | 19,068 | | 20,432 | | Hotel, food and beverage | | 1,618 | | 1,683 | | 6624 | | 6,961 | | General and administrative | | 4,336 | | 4,287 | | 17,652 | | 19,586 | | Impairments and other write-offs | | 8,983 | | - | | 8,985 | | 9,357 | | Depreciation | | 1,490 | | 1,648 | | 6,138 | | 6,772 | | Total operating costs and expenses | | 21,241 | | 12,269 | | 58,467 | | 63,108 | Earnings from unconsolidated subsidiary | | 83 | | 43 | | 359 | | 809 | Operating loss from continuing operations | | (9,027) | | (553) | | (8,370) | | (9,257) | | | | | | | | | | | Non-operating income (expense): | | | | | | | | | | Interest income | | 7 | | 5 | | 50 | | 31 | | Interest expense | | (340) | | (1,043) | | (3,773) | | (4,130) | | Gains (losses) on foreign currency transactions and other | | 446 | | (472) | | 15 | | (441) | Non-operating income (expense), net | | 113 | | (1,510) | | (3,708) | | (4,540) | Loss from continuing operations before income taxes | | (8,914) | | (2,063) | | (12,078) | | (13,797) | | Income tax provision (benefit) | | 306 | | (190) | | 825 | | 4,060 | Loss from continuing operations | | (9,220) | | (1,873) | | (12,903) | | (17,857) | | | | | | | | | | | Discontinued operations: | | | | | | | | | | Earnings from discontinued operations | | - | | 1,218 | | 2,674 | | 5,448 | | Gain on disposition of Century Casino Millennium | | - | | - | | 915 | | - | | Gain on disposition of Century Casinos Africa | | 1,582 | | - | | 21,859 | | - | | Provision for income taxes | | - | | 29 | | 726 | | 786 | Earnings from discontinued operations | | 1,582 | | 1,189 | | 24,722 | | 4,662 | | | | | | | | | | | Net (loss) earnings | | (7,638) | | (684) | | 11,819 | | (13,195) | | Less: Net (loss) earnings attributable to the noncontrolling interests (continuing operations) | | - | | (46) | | (42) | | 77 | | Less: Net earnings attributable to the noncontrolling interests (discontinued operations) | | - | | 13 | | 978 | | 201 | Net (loss) earnings attributable to Century Casinos, Inc. and subsidiaries | $ | (7,638) | $ | (651) | $ | 10,883 | $ | (13,473) | | | | | | | | | |
CENTURY CASINOS, INC. AND SUBSIDIARIES
SUPPLEMENTAL INFORMATION
Century Casinos, Inc. | Earnings per Share | | | | | | | | | | For the Three Months
Ended December 31, | | For the Year
Ended December 31, | | | | 2009 | | 2008 | | 2009 | | 2008 | Basic (loss) earnings per share: | | | | | | | | | | Loss from continuing operations | $ | (0.39) | $ | (0.08) | $ | (0.55) | $ | (0.76) | | Earnings from discontinued operations | | 0.07 | | 0.05 | | 1.01 | | 0.19 | | Net (loss) earnings | $ | (0.32) | $ | (0.03) | $ | 0.46 | $ | (0.57) | | | | | | | | | | | Diluted (loss) earnings per share: | | | | | | | | | | Loss from continuing operations | $ | (0.39) | $ | (0.08) | $ | (0.55) | $ | (0.76) | | Earnings from discontinued operations | | 0.07 | | 0.05 | | 1.01 | | 0.19 | | Net (loss) earnings | $ | (0.32) | $ | (0.03) | $ | 0.46 | $ | (0.57) | | | | | | | | | | Weighted Average Shares Outstanding: | | | | | | | | | | Basic & Diluted | | 23,630,045 | | 23,524,067 | | 23,575,709 | | 23,455,351 | | | | | | | | | | Amounts attributable to Century Casinos, Inc. and subsidiaries common shareholders: | | | | | | | | | | Loss from continuing operations | $ | (9,220) | $ | (1,827) | $ | (12,861) | $ | (17,934) | | Earnings from discontinued operations | | 1,582 | | 1,176 | | 23,744 | | 4,461 | | Net (loss) earnings | $ | (7,638) | $ | (651) | $ | 10,883 | $ | (13,473) | Century Casinos, Inc. | Condensed Consolidated Balance Sheets (Unaudited) | (Amounts in thousands) | | | | | | | | | | December 31,
2009 | | December 31,
2008 | Assets | | | | | | Current Assets, excluding assets held for sale | $ | 39,627 | $ | 9,707 | | Assets held for sale (all current) | | - | | 35,983 | | Other Assets | | 95,683 | | 104,316 | | Total Assets | $ | 135,310 | $ | 150,006 | | | | | | | Liabilities and Shareholders’ Equity | | | | | | Current Liabilities, excluding liabilities related to assets held for sale | $ | 10,984 | $ | 17,521 | | Liabilities related to assets held for sale (all current) | | - | | 10,770 | | Non-Current Liabilities | | 16,037 | | 29,231 | | Shareholders’ Equity | | 108,289 | | 92,484 | | Total Liabilities and Shareholders’ Equity | $ | 135,310 | $ | 150,006 | | | | | | |
CENTURY CASINOS, INC. AND SUBSIDIARIES
SUPPLEMENTAL INFORMATION
Century Casinos, Inc. | Adjusted Operating (Loss) Earnings from Continuing Operations | (Amounts in thousands) | | | | | | | | | | For the Three Months
Ended December 31, | | For the Year
Ended December 31, | | | | 2009 | | 2008 | | 2009 | | 2008 | | Operating Loss from Continuing Operations | $ | (9,027) | $ | (553) | $ | (8,370) | $ | (9,257) | | Impairments and other write-offs | | 8,983 | | - | | 8,985 | | 9,357 | | Adjusted Operating (Loss) Earnings from Continuing Operations | $ | (44) | $ | (553) | $ | 615 | $ | 100 | | | | | | | | | | | Century Casinos, Inc. | Adjusted Net (Loss) Earnings (Unaudited) | (Amounts in thousands) | | | | | | | | | | For the Three Months
Ended December 31, | | For the Year
Ended December 31, | | | | 2009 | | 2008 | | 2009 | | 2008 | | Loss from Continuing Operations | $ | (9,220) | $ | (1,873) | $ | (12,903) | $ | (17,857) | | Impairments and other write-offs | | 8,983 | | - | | 8,985 | | 9,357 | | Tax valuation allowance | | - | | - | | - | | 6,021 | | Write-off of deferred financing charges | | - | | - | | 945 | | - | | Foreign currency losses (gains) | | (406) | | 486 | | 55 | | 455 | | Adjusted Net (Loss) Earnings | $ | (643) | $ | 1,387 | $ | (2,918) | $ | (2,024) | | | | | | | | | | |
The Company defines Adjusted EBITDA margin as Adjusted EBITDA (see below) divided by net operating revenue. Management uses this margin as one of several measures to evaluate the efficiency of the Company’s casino operations.
Century Casinos, Inc. | Adjusted EBITDA Margins by Property (Unaudited) | | | | | | | | | | For the Three Months
Ended December 31, | | For the Year
Ended December 31, | | | | 2009 | | 2008 | | 2009 | | 2008 | | Century Casino & Hotel, Edmonton | | 36% | | 34% | | 35% | | 36% | | Womacks Casino & Hotel (Cripple Creek) | | 12% | | 14% | | 18% | | 15% | | Century Casino & Hotel, Central City | | 22% | | 18% | | 24% | | 22% | | Cruise Ships | | 20% | | 22% | | 18% | | 19% | | Corporate | | - | | - | | - | | - | | Consolidated Adjusted EBITDA Margin | | 14% | | 13% | | 16% | | 16% |
CENTURY CASINOS, INC. AND SUBSIDIARIES
SUPPLEMENTAL INFORMATION
The Company defines Adjusted EBITDA as earnings (loss) from continuing operations before interest, income taxes, depreciation, amortization, pre-opening expenses, non-cash stock based compensation charges, asset impairment costs, gains (losses) on disposition of fixed assets, discontinued operations, realized foreign currency gains (losses) and certain other one-time items. Intercompany transactions consisting primarily of management fees and interest, along with their related tax effects, are excluded from the presentation of net earnings and Adjusted EBITDA reported for each property. These adjustments have no effect on the consolidated results. Adjusted EBITDA is not considered a measure of performance recognized under accounting principles generally accepted in the United States of America. Management believes that Adjusted EBITDA is a valuable measure of the relative performance among its operating segments. The gaming industry commonly uses Adjusted EBITDA as a method of arriving at the economic value of a casino operation. Management uses Adjusted EBITDA to compare the relative operating performance of separate operating units by eliminating the above mentioned items associated with the varying levels of capital expenditures for infrastructure required to generate revenue, and the often high cost of acquiring existing operations. EBITDA (Earnings before interest, taxes, depreciation and amortization) is used by the Company’s lending institution to gauge operating performance. The Company’s computation of Adjusted EBITDA may be different from, and therefore may not be comparable to, similar measures used by other companies. Please see the reconciliation of Adjusted EBITDA to earnings from continuing operations below. Not all of the aforementioned items occur in each reporting period, but have been included in the definition based on historical activity.
Century Casinos, Inc. | Reconciliation of Adjusted EBITDA to Earnings (Loss) from Continuing Operations by Property (Unaudited) | For the Three Months Ended December 31, 2009 | (Amounts in thousands) | | Edmonton | Cripple Creek | Central City | Cruise Ships | Corporate | Total | | | | | | | | Earnings (loss) from continuing operations | $ 958 | $ (21) | $ 58 | $ 11 | $ (10,226) | $ (9,220) | Interest income | (6) | - | - | - | (1) | (7) | Interest expense | 298 | 1 | 21 | - | 20 | 340 | Income taxes | 411 | (14) | 25 | - | (116) | 306 | Depreciation | 345 | 315 | 671 | 91 | 68 | 1,490 | Stock compensation | - | - | - | - | 238 | 238 | Foreign currency losses (gains) | 17 | - | - | - | (423) | (406) | Impairments and other write-offs | - | 5 | - | - | 8,978 | 8,983 | Loss on disposition of fixed assets | - | - | - | - | 1 | 1 | Adjusted EBITDA* | $ 2,023 | $ 286 | $ 775 | $ 102 | $ (1,461) | $ 1,725 |
CENTURY CASINOS, INC. AND SUBSIDIARIES
SUPPLEMENTAL INFORMATION
Century Casinos, Inc. | Reconciliation of Adjusted EBITDA to Earnings (Loss) from Continuing Operations by Property (Unaudited) | For the Three Months Ended December 31, 2008 | (Amounts in thousands) | | Edmonton | Cripple Creek | Central City | Cruise Ships | Corporate | Total | | | | | | | | Earnings (loss) from continuing operations | $ 742 | $ (97) | $ (430) | $ 44 | $ (2,132) | $ (1,873) | Interest income | (2) | - | - | - | (3) | (5) | Interest expense | 323 | 47 | 611 | - | 62 | 1,043 | Income taxes | 309 | (62) | (275) | 1 | (163) | (190) | Depreciation | 305 | 451 | 765 | 59 | 68 | 1,648 | Stock compensation | - | - | - | - | 399 | 399 | Foreign currency losses | (19) | (1) | - | - | 506 | 486 | Impairments and other write-offs | - | - | - | - | - | - | Loss on disposition of fixed assets | - | - | - | 19 | - | 19 | Adjusted EBITDA* | $ 1,658 | $ 338 | $ 671 | $ 123 | $ (1,263) | $ 1,527 | Century Casinos, Inc. | Reconciliation of Adjusted EBITDA to Earnings (Loss) from Continuing Operations by Property (Unaudited) | For the Year Ended December 31, 2009 | (Amounts in thousands) | | Edmonton | Cripple Creek | Central City | Cruise Ships | Corporate | Total | | | | | | | | Earnings (loss) from continuing operations | $ 3,311 | $ 242 | $ (733) | $ 56 | $ (15,779) | $ (12,903) | Interest income | (10) | - | (1) | - | (39) | (50) | Interest expense | 1,121 | 144 | 2,329 | - | 179 | 3,773 | Income taxes | 1,327 | 147 | (498) | 1 | (152) | 825 | Depreciation | 1,304 | 1,361 | 2,894 | 311 | 268 | 6,138 | Stock compensation | - | - | - | - | 1,101 | 1,101 | Foreign currency losses | 75 | - | - | - | (20) | 55 | Impairments and other write-offs | - | 5 | - | - | 8,980 | 8,985 | Loss on disposition of fixed assets | - | - | 3 | - | 14 | 17 | Adjusted EBITDA* | $ 7,128 | $ 1,899 | $ 3,994 | $ 368 | $ (5,448) | $ 7,941 |
CENTURY CASINOS, INC. AND SUBSIDIARIES
SUPPLEMENTAL INFORMATION
Century Casinos, Inc. | Reconciliation of Adjusted EBITDA to Earnings (Loss) from Continuing Operations by Property (Unaudited) | For the Year Ended December 31, 2008 | (Amounts in thousands) | | Edmonton | Cripple Creek | Central City | Cruise Ships | Corporate | Total | | | | | | | | Earnings (loss) from continuing operations | $ 3,681 | $ (7,305) | $ (2,984) | $ 160 | $ (11,409) | $ (17,857) | Interest income | (19) | - | - | - | (12) | (31) | Interest expense | 1,382 | (22) | 2,306 | - | 464 | 4,130 | Income taxes | 1,567 | (45) | (574) | 4 | 3,108 | 4,060 | Depreciation | 1,385 | 1,806 | 3,032 | 250 | 299 | 6,772 | Stock compensation | - | - | - | - | 1,443 | 1,443 | Foreign currency (gains) losses | (125) | - | - | - | 580 | 455 | Impairments and other write-offs | - | 7,233 | 2,124 | - | - | 9,357 | Loss on disposition of fixed assets | - | - | 2 | 40 | 6 | 48 | Adjusted EBITDA* | $ 7,871 | $ 1,667 | $ 3,906 | $ 454 | $ (5,521) | $ 8,377 | Century Resorts Alberta | Reconciliation of Adjusted EBITDA to Net Earnings (Unaudited) in Canadian Dollars | (Amounts in thousands) | | For the three months ended
December 31, 2009 | For the three months ended
December 31, 2008 | For the year ended
December 31, 2009 | For the year ended
December 31, 2008 | | | | | | Net earnings | CAD 1,095 | CAD 936 | CAD 3,930 | CAD 3,829 | Interest income | (7) | (2) | (11) | (20) | Interest expense | 315 | 389 | 1,274 | 1,467 | Income taxes | 434 | 317 | 1,508 | 1,598 | Depreciation | 366 | 369 | 1,484 | 1,470 | Foreign currency (gains) | (67) | (2) | (67) | (7) | Adjusted EBITDA* | CAD 2,136 | CAD 2,007 | CAD 8,118 | CAD 8,337 |
CENTURY CASINOS, INC. AND SUBSIDIARIES
SUPPLEMENTAL INFORMATION
About Century Casinos, Inc.:
Century Casinos, Inc. is an international casino entertainment company that owns and operates the Womacks Casino & Hotel in Cripple Creek, Colorado, the Century Casino & Hotel in Central City, Colorado, the Century Casino & Hotel in Edmonton, Canada and the Silver Dollar Casino in Calgary, Canada. The Company also operates casinos aboard five luxury cruise vessels (Silver Cloud, Regatta, Insignia, Nautica, Mein Schiff). Through its Austrian subsidiary, Century Casinos Europe GmbH, the Company holds a 33.3% ownership interest in Casinos Poland Ltd., the owner and operator of seven full casinos and one slot casino in Poland. Century Casinos, Inc. continues to pursue other international projects in various stages of development.
For more information about Century Casinos, visit our website at www.centurycasinos.com. Century Casinos’ common stock trades on The NASDAQ Capital Market® and the Vienna Stock Exchange under the symbol CNTY.
This release may contain “forward-looking statements“ within the meaning of the Private Securities Litigation Reform Act of 1995. These statements are based on the beliefs and assumptions of the management of Century Casinos based on information currently available to management. Such forward-looking statements include, but are not limited to, expected competition, expected purchase of property in Cripple Creek, plans for our casinos and the impact of economic downturn. Such forward-looking statements are subject to risks, uncertainties and other factors that could cause actual results to differ materially from future results expressed or implied by such forward-looking statements. Important factors that could cause actual results to differ materially from the forward-looking statements include, among others, the risks described in the sections entitled “Risk Factors” under Item 1A in our Annual Report on Form 10-K filed on March 15, 2010. Century Casinos disclaims any obligation to revise or update any forward-looking statement that may be made from time to time by it or on its behalf.
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