Boyd Gaming Reports Fourth Quarter, Full Year 2015 Results

LAS VEGAS, Feb. 16, 2016 /PRNewswire/ -- Boyd Gaming Corporation (NYSE: BYD) today reported financial results for the fourth quarter and full year ended December 31, 2015.  

Boyd Gaming reported fourth quarter 2015 net revenues of $542.7 million, an increase of 2.1% from $531.6 million for the same quarter in 2014.  Total Adjusted EBITDA⁽¹⁾ was $154.2 million, up 13.1% from $136.4 million for the year-ago period. 

Keith Smith, President and Chief Executive Officer of Boyd Gaming, said: "The fourth quarter of 2015 was a strong conclusion to a year of solid progress for our Company.  Our operating teams continued to drive profitable revenue growth, identify additional efficiencies in our business, and successfully leverage new amenities, all of which contributed to our fifth consecutive quarter of revenue and double-digit Adjusted EBITDA growth. We were particularly encouraged by the performance of our Las Vegas Locals business, as a strengthening economy and effective marketing programs resulted in the segment's strongest fourth-quarter results since 2007. After a strong performance in 2015, we are well-positioned for continued growth and success this year."

Adjusted Earnings⁽¹⁾ for the fourth quarter 2015 were $18.2 million, or $0.16 per share, compared to a loss of $0.1 million, or breakeven on a per-share basis, for the same period in 2014.   The calculations of Adjusted Earnings, Adjusted Earnings per share, and pro forma results reflecting Borgata on a comparable basis for all periods are presented in tables at the end of this press release.

On a GAAP basis, the Company reported a net loss of $6.9 million, or $0.06 per share, for the fourth quarter 2015, compared to a net loss of $32.4 million, or $0.29 per share, for the year-ago period.  During the fourth quarter of 2015, the Company reported noncash intangible asset impairment charges of $17.5 million and a pretax loss on early extinguishments of debt of $8.4 million.  Results for the prior-year period included noncash impairment charges of $40.6 million, primarily due to the impairments of intangible assets.  These charges are not included in Adjusted Earnings or Adjusted Earnings per share.

Key Operations Review

Las Vegas Locals
In the Las Vegas Locals segment, fourth-quarter 2015 net revenues rose 4.6% to $158.8 million, compared to $151.7 million in the year-ago period.  Fourth-quarter 2015 Adjusted EBITDA was $44.0 million ‒ an increase of 10.7% from $39.8 million in the fourth quarter of 2014 – marking the segment's best fourth-quarter Adjusted EBITDA performance in eight years.  Results reflect broad-based growth in both gaming and non-gaming revenues.  Operating margins improved more than 150 basis points year-over-year, driving the segment's third consecutive quarter of double-digit Adjusted EBITDA gains.

Downtown Las Vegas
In the Downtown Las Vegas segment, net revenues were $62.5 million in the fourth quarter of 2015, up 4.8% from $59.6 million in the year-ago period.  Adjusted EBITDA was $16.2 million, a 23.4% increase from $13.1 million in the fourth quarter of 2014, marking the segment's sixth straight quarter of Adjusted EBITDA growth.  Results benefitted from significant increases in visitation throughout the Downtown area, as well as lower fuel costs at the Company's Hawaiian charter service.

Midwest and South; Peninsula
In the Midwest and South segment, fourth-quarter 2015 net revenues were $200.9 million, up from $200.0 million in the year-ago quarter.  Adjusted EBITDA rose 8.1% to $43.3 million, compared to $40.1 million in the fourth quarter of 2014.

During the fourth quarter of 2015, the Peninsula segment reported net revenues of $120.5 million, increasing from $120.2 million in the year-ago period. Adjusted EBITDA was $43.0 million, up 1.9% from $42.2 million in the fourth quarter of 2014. 

Ongoing refinements to marketing programs and operations drove the fifth consecutive quarter of revenue and Adjusted EBITDA growth in the two segments, as margins improved nearly 120 basis points year-over-year on a combined basis.  Results were led by double-digit Adjusted EBITDA gains at Blue Chip, Diamond Jo Dubuque, Treasure Chest and IP.

Borgata
Borgata reported fourth quarter 2015 net revenues of $193.0 million, a 7.7% increase from the $179.1 million in revenues reported in the year-ago period. Fourth-quarter Adjusted EBITDA at Borgata was $45.9 million, up 27.3% from $36.0 million in the fourth quarter of 2014. 

The Company applies the equity method of accounting to its 50% investment in Borgata, and the Company's share of Borgata's Adjusted EBITDA was $22.9 million for the fourth quarter of 2015, compared to $18.0 million for the prior-year period.

Borgata's fourth-quarter results reflect successful efforts to leverage the property's market-leading amenities, more efficient marketing initiatives, and higher table hold. Borgata achieved fourth-quarter records for gross slot win and hotel rooms occupied, as well as a record gross gaming market share of 30.4%.  

Full Year 2015 Results
For the full year ended December 31, 2015, Boyd Gaming reported pro forma net revenues of $2.20 billion, an increase of 2.7% from $2.14 billion in pro forma net revenues reported for the year-ago period.  Total pro forma Adjusted EBITDA was $629.5 million, an increase of 15.4% compared to $545.3 million in the prior year.

Effective September 30, 2014, the Company deconsolidated Borgata and is accounting for its 50% investment in Borgata by applying the equity method for periods subsequent to that date.  The prior-year pro forma amounts reflect the results for Borgata on a comparable equity method basis to the current period presentation.

Adjusted Earnings for the year ended December 31, 2015, were $89.7 million, or $0.79 per share, compared to $1.3 million, or $0.01 per share, for the year ended December 31, 2014.

On a GAAP basis, Boyd Gaming reported net income of $47.2 million, or $0.42 per share, for the full year ended December 31, 2015.  By comparison, the Company reported a net loss of $53.0 million, or $0.48 per share, for the prior-year period.  The Company's results for the year ended December 31, 2015, included noncash impairment charges of $18.6 million and pretax losses on the early extinguishments of debt of $40.7 million.  In addition, settlements of previous years' income tax appeals reduced the 2015 income tax provision by $30.4 million.  Results for the prior year included impairment charges of $60.8 million.  These amounts are excluded from Adjusted Earnings and Adjusted Earnings per share.

Balance Sheet Statistics
As of December 31, 2015, Boyd Gaming had cash on hand of $158.8 million, including $29.6 million related to Peninsula.  Total debt was $3.32 billion, of which $1.01 billion was related to Peninsula. As a result of the deconsolidation, Borgata is no longer included in the Company's balance sheet. Borgata had cash on hand of $44.1 million and total debt of $697.6 million at December 31, 2015. 

Full Year 2016 Guidance
For the full year 2016, Boyd Gaming projects total Adjusted EBITDA, including Peninsula and 50% of Borgata's Adjusted EBITDA, of $635 million to $655 million.

Conference Call Information
Boyd Gaming will host its conference call to discuss fourth quarter and full year 2015 results today, February 16, at 5:00 p.m. Eastern.  The conference call number is (888) 317-6003, passcode 7592271.  Please call up to 15 minutes in advance to ensure you are connected prior to the start of the call. 

The conference call will also be available live on the Internet at www.boydgaming.com, or: https://www.webcaster4.com/Webcast/Page/964/13211

Following the call's completion, a replay will be available by dialing (877) 344-7529 today, February 16, beginning at 7:00 p.m. Eastern and continuing through Wednesday, February 24, at 11:59 p.m. Eastern.  The conference number for the replay will be 10080449.  The replay will also be available on the Internet at www.boydgaming.com.

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