Dover Downs Gaming & Entertainment, Inc. Reports Results for the First Quarter Ended March 31, 2017

DOVER, Del.--()--Dover Downs Gaming & Entertainment, Inc. (NYSE: DDE) today reported results for the three months ended March 31, 2017.

The Company’s revenues for the first quarter of 2017 were $44,148,000 compared with $44,717,000 for the first quarter of 2016.

Gaming revenues of $38,647,000 were down 1.8% compared to the first quarter of last year, primarily from lower horse racing revenue and a lower table game hold percentage.

Other operating revenues were $5,501,000 compared to $5,359,000 last year. Occupancy levels in the Dover Downs Hotel were approximately 74% for the first quarter of 2017 and 2016.

General and administrative expenses of $1,331,000 were consistent with last year.

Depreciation expense increased to $1,946,000 from $1,887,000 last year.

Interest expense decreased to $209,000 during the quarter as a result of lower outstanding borrowings partially offset by slightly higher rates.

Net loss was ($184,000), or ($.01) per diluted share, compared with net loss of ($239,000), or ($.01) per diluted share for the first quarter of 2016.

This release contains or may contain forward-looking statements based on management’s beliefs and assumptions. Such statements are subject to various risks and uncertainties that could cause results to vary materially. Please refer to the Company’s SEC filings for a discussion of such factors.

Owned by Dover Downs Gaming & Entertainment, Inc. (NYSE: DDE), Dover Downs Hotel & Casino® is a premier gaming and entertainment resort destination in the Mid-Atlantic region. Gaming operations consist of approximately 2,300 slots and a full complement of table games including poker. The AAA-rated Four Diamond hotel is Delaware’s largest with 500 luxurious rooms/suites and amenities including a full-service spa/salon, concert hall and 41,500 sq. ft. of multi-use event space. Live, world-class harness racing is featured November through April, and horse racing is simulcast year-round. Professional football parlay betting is accepted during the season. Additional property amenities include multiple restaurants from fine dining to casual fare, bars/lounges and retail shops. For more information, please visit www.doverdowns.com.

 
DOVER DOWNS GAMING & ENTERTAINMENT, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
In Thousands, Except Per Share Amounts
(Unaudited)
     
 
Three Months Ended
March 31,
  2017     2016  
Revenues:
Gaming (1) $ 38,647 $ 39,358
Other operating (2)   5,501     5,359  
  44,148     44,717  
Expenses:
Gaming 36,869 37,495
Other operating 3,950 3,973
General and administrative 1,331 1,328
Depreciation   1,946     1,887  
  44,096     44,683  
 
Operating earnings 52 34
 
Interest expense   (209 )   (229 )
 
Loss before income taxes (157 ) (195 )
 
Income tax expense   (27 )   (44 )
 
Net loss $ (184 ) $ (239 )
 
Net loss per common share:
- Basic $ (0.01 ) $ (0.01 )
- Diluted $ (0.01 ) $ (0.01 )
 
Weighted average shares outstanding:
- Basic 32,319 32,199
- Diluted 32,319 32,199
_________________________
(1)  

Gaming revenues from the Company’s slot machine and table game operations include the total win from such operations. The Delaware State Lottery Office collects the win and remits a portion thereof to the Company as its commission for acting as a Licensed Agent. The difference between total win and the amount remitted to the Company is reflected in gaming expenses.

(2)

Other operating revenues do not include the retail amount of promotional allowances which are provided to customers on a complimentary basis.

 

 
DOVER DOWNS GAMING & ENTERTAINMENT, INC.
CONSOLIDATED BALANCE SHEETS
In Thousands
(Unaudited)
   
 
March 31, December 31,
2017 2016
ASSETS
 
Current assets:
Cash $ 10,802 $ 11,677
Accounts receivable 2,815 3,507
Due from State of Delaware 1,889 7,285
Inventories 2,107 1,910
Prepaid expenses and other 2,134 2,365
Receivable from Dover Motorsports, Inc. 8 7
Income taxes receivable   242     221  

Total current assets

19,997 26,972
 
Property and equipment, net 139,155 140,714
Other assets 584 594
Deferred income taxes   2,004     2,020  
Total assets

$

161,740

 

$

170,300

 
 
LIABILITIES AND STOCKHOLDERS’ EQUITY
 
Current liabilities:
Accounts payable $ 3,932 $ 3,749
Purses due horsemen 2,084 7,649
Accrued liabilities 8,018 9,732
Deferred revenue 485 361
Revolving line of credit   24,000     25,250  
Total current liabilities 38,519 46,741
 
Liability for pension benefits   7,660     7,897  
Total liabilities   46,179     54,638  
 
Stockholders’ equity:
Common stock 1,828 1,814
Class A common stock 1,487 1,487
Additional paid-in capital 5,709 5,669
Retained earnings 111,104 111,288
Accumulated other comprehensive loss   (4,567 )   (4,596 )
Total stockholders’ equity   115,561     115,662  
Total liabilities and stockholders’ equity

$

161,740

 

$

170,300

 
 
   
DOVER DOWNS GAMING & ENTERTAINMENT, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
In Thousands
(Unaudited)
 
Three Months Ended
March 31,
2017 2016
 
Operating activities:
Net loss $ (184 ) $ (239 )

Adjustments to reconcile net loss to net cash provided by operating activities:

Depreciation 1,946 1,887
Amortization of credit facility origination fees 13 26
Stock-based compensation 128 103
Deferred income taxes (3 ) 46
Changes in assets and liabilities:
Accounts receivable 692 (129 )
Due from State of Delaware 5,396 5,289
Inventories (197 ) (26 )
Prepaid expenses and other 226 559
Receivable from/payable to Dover Motorsports, Inc. (1 ) (54 )
Income taxes receivable (21 ) 28
Accounts payable 370 562
Purses due horsemen (5,565 ) (4,723 )
Accrued liabilities (1,714 ) (848 )
Deferred revenue 124 95
Liability for pension benefits   (186 )   (149 )
Net cash provided by operating activities   1,024     2,427  
 
Investing activities:
Capital expenditures (574 ) (1,279 )
Purchase of available-for-sale securities (31 ) (1 )
Proceeds from sale of available-for-sale securities   30     -  
Net cash used in investing activities   (575 )   (1,280 )
 
Financing activities:
Borrowings from revolving line of credit 29,730 15,450
Repayments of revolving line of credit (30,980 ) (15,950 )
Repurchase of common stock   (74 )   (66 )
Net cash used in financing activities   (1,324 )   (566 )
 
Net (decrease) increase in cash (875 ) 581
Cash, beginning of period   11,677     10,496  
Cash, end of period $ 10,802   $ 11,077  
 

Contacts

Dover Downs Gaming & Entertainment, Inc.
Timothy R. Horne - Sr. Vice President-Finance
302-857-3292

Contacts

Dover Downs Gaming & Entertainment, Inc.
Timothy R. Horne - Sr. Vice President-Finance
302-857-3292