Exhibit 99.1

 

 

FOR IMMEDIATE RELEASE

For further information, call:

 

Timothy R. Horne - Sr. Vice President-Finance

Dover, Delaware, October 25, 2018

(302) 857-3292

 

DOVER DOWNS GAMING & ENTERTAINMENT, INC. REPORTS RESULTS

FOR THE THIRD QUARTER ENDED SEPTEMBER 30, 2018

 

Dover Downs Gaming & Entertainment, Inc. (NYSE-DDE) today reported results for the three months ended September 30, 2018.

 

Gaming revenues increased 2.8% to $36,723,000 compared to $35,716,000 for the third quarter of 2017.  Slot machine and table game win were both higher, and sports betting win improved as a result of recently expanded sports wagering in Delaware.  These increases were offset by lower wagering on horse racing compared to last year.

 

Other operating revenues of $9,284,000 were up slightly compared to the third quarter of 2017 from an increase in food and beverage revenue offset by a decline in rooms revenue during the quarter.  Occupancy levels in the Dover Downs Hotel were almost 90% for the third quarter of both years, while average rates were lower this year.

 

General and administrative costs were $1,355,000 for the third quarter compared to $1,316,000 last year.

 

Costs incurred to date related to the Company’s pending merger with Twin River Worldwide Holdings, Inc. were $765,000 during the quarter.

 

Including the merger related costs, the Company’s pretax loss was ($149,000) compared with ($225,000) for the third quarter of last year.

 

Net loss was ($269,000), or ($.01) per diluted share compared with net loss of ($138,000) or $.00 per diluted share for the third quarter of 2017.

 

Capital spending increased to $3,029,000 for the nine months ended September 30, 2018 as compared to $1,764,000 for the comparable period last year, and related primarily to renovations to the Dover Downs Hotel and improvements related to the recently opened Pearl Oyster Grill.

 


 

* * *

 

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 2,200 slots, a full complement of table games, including poker, and a newly expanded race and sports book taking single game wagers on professional and college sports.  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.  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

 

Nine Months Ended

 

 

 

September 30,

 

September 30,

 

 

 

2018

 

2017 *

 

2018

 

2017 *

 

Revenues:

 

 

 

 

 

 

 

 

 

Gaming

 

$

36,723

 

$

35,716

 

$

104,752

 

$

104,249

 

Other operating

 

9,284

 

9,245

 

28,547

 

27,865

 

 

 

46,007

 

44,961

 

133,299

 

132,114

 

Expenses:

 

 

 

 

 

 

 

 

 

Gaming

 

34,427

 

34,446

 

99,992

 

100,427

 

Other operating

 

7,493

 

7,141

 

22,182

 

21,403

 

General and administrative

 

1,355

 

1,316

 

4,082

 

4,024

 

Merger costs

 

765

 

 

765

 

 

Depreciation

 

2,010

 

2,096

 

6,200

 

6,128

 

 

 

46,050

 

44,999

 

133,221

 

131,982

 

 

 

 

 

 

 

 

 

 

 

Operating (loss) earnings

 

(43

)

(38

)

78

 

132

 

 

 

 

 

 

 

 

 

 

 

Interest expense

 

(190

)

(217

)

(598

)

(634

)

Other income

 

84

 

30

 

251

 

118

 

 

 

 

 

 

 

 

 

 

 

Loss before income taxes

 

(149

)

(225

)

(269

)

(384

)

 

 

 

 

 

 

 

 

 

 

Income tax (expense) benefit

 

(120

)

87

 

(120

)

83

 

 

 

 

 

 

 

 

 

 

 

Net loss

 

$

(269

)

$

(138

)

$

(389

)

$

(301

)

 

 

 

 

 

 

 

 

 

 

Net loss per common share:

 

 

 

 

 

 

 

 

 

- Basic

 

$

(0.01

)

$

 

$

(0.01

)

$

(0.01

)

- Diluted

 

$

(0.01

)

$

 

$

(0.01

)

$

(0.01

)

 

 

 

 

 

 

 

 

 

 

Weighted average shares outstanding:

 

 

 

 

 

 

 

 

 

- Basic

 

32,447

 

32,322

 

32,446

 

32,321

 

- Diluted

 

32,447

 

32,322

 

32,446

 

32,321

 

 


*                 Prior-period information has been restated for the adoption of Accounting Standards Update (“ASU”) No. 2014-09, Revenue from Contracts with Customers, and ASU No. 2017-07, Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost, which we adopted on January 1, 2018.

 


 

DOVER DOWNS GAMING & ENTERTAINMENT, INC.

CONSOLIDATED BALANCE SHEETS

In Thousands

(Unaudited)

 

 

 

September 30,

 

December 31,

 

 

 

2018

 

2017 *

 

ASSETS

 

 

 

 

 

 

 

 

 

 

 

Current assets:

 

 

 

 

 

Cash

 

$

10,184

 

$

10,714

 

Accounts receivable

 

2,784

 

3,557

 

Due from State of Delaware

 

8,958

 

5,720

 

Inventories

 

2,059

 

1,928

 

Prepaid expenses and other

 

3,504

 

2,840

 

Receivable from Dover Motorsports, Inc.

 

6

 

7

 

Income taxes receivable

 

294

 

318

 

Total current assets

 

27,789

 

25,084

 

 

 

 

 

 

 

Property and equipment, net

 

131,460

 

134,527

 

Other assets

 

404

 

564

 

Deferred income taxes

 

1,656

 

1,786

 

Total assets

 

$

161,309

 

$

161,961

 

 

 

 

 

 

 

LIABILITIES AND STOCKHOLDERS’ EQUITY

 

 

 

 

 

 

 

 

 

 

 

Current liabilities:

 

 

 

 

 

Accounts payable

 

$

2,569

 

$

2,571

 

Purses due horsemen

 

8,960

 

5,814

 

Accrued liabilities

 

8,372

 

8,111

 

Deferred credits

 

120

 

49

 

Contract liabilities

 

3,954

 

3,724

 

Revolving line of credit

 

16,500

 

19,900

 

Total current liabilities

 

40,475

 

40,169

 

 

 

 

 

 

 

Liability for pension benefits

 

6,713

 

7,483

 

Total liabilities

 

47,188

 

47,652

 

 

 

 

 

 

 

Stockholders’ equity:

 

 

 

 

 

Common stock

 

1,841

 

1,827

 

Class A common stock

 

1,487

 

1,487

 

Additional paid-in capital

 

5,976

 

5,877

 

Retained earnings

 

109,462

 

109,817

 

Accumulated other comprehensive loss

 

(4,645

)

(4,699

)

Total stockholders’ equity

 

114,121

 

114,309

 

Total liabilities and stockholders’ equity

 

$

161,309

 

$

161,961

 

 

 


 

*                 Prior-period information has been restated for the adoption of ASU No. 2014-09, Revenue from Contracts with Customers, which we adopted on January 1, 2018.

 


 

DOVER DOWNS GAMING & ENTERTAINMENT, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

In Thousands

(Unaudited)

 

 

 

Nine Months Ended

 

 

 

September 30,

 

 

 

2018

 

2017 *

 

Operating activities:

 

 

 

 

 

Net loss

 

$

(389

)

$

(301

)

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

 

 

 

 

 

Depreciation

 

6,200

 

6,128

 

Amortization of credit facility origination fees

 

30

 

42

 

Stock-based compensation

 

187

 

243

 

Deferred income taxes

 

98

 

(233

)

Gains on equity investments

 

(5

)

 

Changes in assets and liabilities:

 

 

 

 

 

Accounts receivable

 

773

 

729

 

Due from State of Delaware

 

(3,238

)

(454

)

Inventories

 

(131

)

(164

)

Prepaid expenses and other

 

(671

)

(1,185

)

Receivable from/payable to Dover Motorsports, Inc.

 

1

 

34

 

Income taxes receivable

 

22

 

50

 

Accounts payable

 

73

 

238

 

Purses due horsemen

 

3,146

 

115

 

Accrued liabilities

 

261

 

(848

)

Deferred credits

 

71

 

23

 

Contract liabilities

 

230

 

469

 

Liability for pension benefits

 

(648

)

(347

)

Net cash provided by operating activities

 

6,010

 

4,539

 

 

 

 

 

 

 

Investing activities:

 

 

 

 

 

Capital expenditures

 

(3,029

)

(1,764

)

Purchase of equity investments

 

(33

)

(47

)

Proceeds from sale of equity investments

 

29

 

44

 

Net cash used in investing activities

 

(3,033

)

(1,767

)

 

 

 

 

 

 

Financing activities:

 

 

 

 

 

Borrowings from revolving line of credit

 

34,180

 

58,670

 

Repayments of revolving line of credit

 

(37,580

)

(62,420

)

Repurchase of common stock

 

(74

)

(74

)

Credit facility fees

 

(33

)

(35

)

Net cash used in financing activities

 

(3,507

)

(3,859

)

 

 

 

 

 

 

Net decrease in cash

 

(530

)

(1,087

)

Cash, beginning of period

 

10,714

 

11,677

 

Cash, end of period

 

$

10,184

 

$

10,590

 

 


*                 Prior-period information has been restated for the adoption of ASU No. 2014-09, Revenue from Contracts with Customers, which we adopted on January 1, 2018.

 


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