EXHIBIT 99.1

Monarch Casino & Resort Reports Fourth Quarter Net Revenue of $59.8 Million, Net Income of $7.3 Million and Adjusted EBITDA of $13.4 Million

RENO, Nev., Feb. 20, 2019 (GLOBE NEWSWIRE) -- Monarch Casino & Resort, Inc. (Nasdaq: MCRI) (“Monarch” or “the Company”) today reported operating results for the fourth quarter and full year ended December 31, 2018, as summarized below:

 Three Months Ended December 31, Twelve Months Ended December,
 2018 2017 Increase 2018 2017 Increase
  Net revenue(1) $ 59,779  $ 56,056 6.6%  $ 240,315  $ 230,726 4.2%
            
  Adjusted EBITDA(2)  13,435   12,589 6.7%   60,586   58,046 4.4%
            
  Net income $ 7,259  $ 4,397 65.1%  $ 34,098  $ 25,538 33.5%
            
  Basic EPS $ 0.40  $ 0.25 60.0%  $ 1.91  $ 1.45 31.7%
  Diluted EPS $ 0.39  $ 0.23 69.6%  $ 1.83  $ 1.39 31.7%

(1) As described in the section below entitled “New Revenue Recognition Standard,” the Company has changed its revenue recognition policy effective January 1, 2018. This change resulted in a $585 thousand and $936 thousand increase in Net revenue for the three and twelve months ended December 31, 2018, respectively. Please see the reconciliation provided at the end of this release for more information related to the changes in revenues and expenses.
(2) Definitions, disclosures and reconciliations of non-GAAP financial information are included later in the release.

CEO Comment
John Farahi, Co-Chairman and Chief Executive Officer of Monarch, commented: “The 2018 fourth quarter completed a productive year, with record financial performance at Atlantis Casino Resort in Reno and consistent progress towards the anticipated opening of the transformed Monarch Casino Black Hawk later in 2019. In the fourth quarter, Monarch generated net revenue and adjusted EBITDA growth of 6.6% and 6.7%, respectively, as strong top-line performance was partially offset by the ongoing impact of higher labor expenses across our business and construction disruption in Black Hawk.

“Atlantis Casino Resort and Spa generated record fourth quarter revenue and EBITDA. Reno’s ongoing revitalization drove strong visitation and equally strong gaming trends as our team leveraged Atlantis’ best-in-class amenities to maintain our strong market share.

“Fourth quarter financial performance at Monarch Casino Black Hawk was impacted by the ongoing construction and increased labor expenses, including management-level hiring in anticipation of the commencement of our expanded operations later this year. Black Hawk results for the 2018 fourth quarter were also impacted by a gaming system conversion issue, which weighed heavily on promotional expenses.

“Our Monarch Casino Black Hawk general contractor has informed us that the new expanded casino, hotel tower, restaurants and retail areas will be completed in the third quarter of 2019 and that the upgraded amenities in the existing casino will be completed in the fourth quarter of 2019.

“Since acquiring the former Riviera Black Hawk in 2012, we have been executing our vision for transforming the property into Black Hawk’s leading gaming and entertainment resort destination and remain confident in our ability to generate an attractive return on our ongoing investment. This investment, combined with our growth in Reno and our industry-best balance sheet, positions Monarch to drive long-term stockholder value.”

New Revenue Recognition Standard
On January 1, 2018, the Company adopted accounting standard update No. 2014-09 (“ASC 606”) and all the related amendments (“new revenue standard”) to all contracts which provides consistency in the reported financial information within the gaming industry. The Company applied the modified retrospective method and recognized the cumulative effect of the initial application of the new revenue standard as an adjustment to the opening balance of retained earnings. The opening retained earnings adjustment primarily related to the change in the accounting for the slot club liability from the immediate revenue/cost method to the deferred revenue method.

The new revenue standard also resulted in reclassifications to and from revenues, promotional allowances and operating expenses. Pursuant to the new revenue standard, food and beverage, hotel and other complimentaries are now valued at their retail price and included as revenues within their respective categories, with a corresponding decrease in gaming revenues, as the offsetting amount historically included in promotional allowances has been eliminated. In addition, the cost of providing these complimentary goods and services are now included as expenses within their respective categories, resulting in a corresponding decrease in casino expenses. While those changes resulted in a $585 thousand and $936 thousand increase in net revenue for the three and twelve months ended December 31, 2018, respectively, they had no impact on adjusted EBITDA, net income or EPS (basic and diluted).

Financial results for the three months and twelve months ended December 31, 2017 have not been restated and are reported under the accounting standards in effect during those periods. The Company has provided reconciliation between the new revenue standard and the old revenue standard for the three and twelve months ended December 31, 2018 at the end of this release.

Summary of 2018 Fourth Quarter Operating Results
For the 2018 fourth quarter, consolidated net revenues of $59.8 million increased 6.6% from $56.1 million in the prior year. Casino revenues declined 28.0% year over year, while food and beverage revenues increased 14.0% and hotel revenues increased 23.1%, primarily reflecting the previously announced change in revenue recognition accounting. Please see “Monarch Casino & Resort, Inc. and Subsidiaries Reconciliation of Post to Pre ASC 606 Adoption” below for more information.

Selling, general and administrative (“SG&A”) expenses for the fourth quarter of 2018 were $17.7 million compared to $16.6 million in the prior year period, driven primarily by higher labor expense, in addition to increased management staffing in preparation for the opening of the Black Hawk expansion later this year. As a percentage of net revenue, SG&A expenses were 29.6% in both the 2018 and 2017 fourth quarter periods. Casino operating expense as a percentage of casino revenue decreased to 34.5% in the fourth quarter of 2018 compared to 41.9% in the fourth quarter of 2017 due to the adoption of the new revenue standard and operational efficiencies. Food and beverage operating expense as a percentage of food and beverage revenue increased to 76.7% during the fourth quarter of 2018 from 39.1% a year ago due to the adoption of the new revenue standard. Hotel operating expense as a percentage of hotel revenue increased to 46.4% in the fourth quarter of 2018 compared to 38.1% in the same period in the prior year, primarily as a result of the adoption of the new revenue standard as well as an increase in labor expenses, partially offset by operational efficiencies.

The Company generated consolidated adjusted EBITDA of $13.4 million in the fourth quarter of 2018, an increase of $0.8 million, or 6.7%, over the same period a year ago. Net income and diluted EPS for the fourth quarter of 2018 rose 65.1% and 69.6%, respectively, partially benefiting from a lower tax rate as a result of the Tax Cuts and Jobs Act enacted late in 2017.

Monarch Black Hawk Expansion
Summarized below is an update on the Company’s ongoing upgrade and expansion of Monarch Casino Black Hawk, including the budgeted costs and completion dates for the project as well as the amounts spent through December 31, 2018: 

$ in millionsBudget Cost Total Spent Through
December 31, 2018
 Left to
Spend
 Estimated
Completion Date
 
I. Existing Facility        
  Monarch Casino Black Hawk (1)$76 $76 - Completed 
  Existing Facility Upgrade (2)(3)$34 - $36 $25 $9- $11 Exterior 2Q19
Interior 4Q19
 
  Total Existing Facility$110 - $112 $101 $9 - $11   
         
II. Expansion        
  Acquired Land Parcels$10 $10 - Completed 
  Parking Structure$38 - $41 $41 - Completed 
  Hotel Tower & Casino (3) $264 - $269 $144 $120- $125 3Q19 
  Other  $8 - $10 $10 -   
  Total Expansion$320 - $330 $205 $120 - $125   
  Total Cost$430 - $442 $306 $129 - $136   
         
(1) The Company paid $76.0 million cash or $69.2 million net of acquired working capital and NOLs when it acquired Monarch Casino Black Hawk (formerly Riviera Black Hawk Casino) in 2012. 
(2) Includes upgrades to the interior, which were completed in August 2015, demolition of the original garage, and upgrades to the exterior of the existing facility to match the design of the master planned expansion.
(3) The Company anticipates funding the hotel tower and casino expansion, as well as the existing facility exterior upgrades, from a combination of operating cash flow and the amended and restated credit facility (the “Amended Credit Facility”). 
  

As previously stated, our Monarch Casino Black Hawk general contractor has informed us that our new expanded casino, hotel tower, restaurants and retail areas will be completed in the third quarter of 2019 and that the upgraded amenities in the existing casino will be completed in the fourth quarter of 2019.

Credit Facility and Liquidity
Capital expenditures of $43.2 million in the fourth quarter of 2018 include construction costs related to the Monarch Casino Black Hawk expansion and ongoing capital maintenance spending. Capital expenditures were funded from the Company’s operating cash flows as well as $25.2 million of borrowings against Monarch’s Amended Credit Facility during the quarter. The amount of borrowings outstanding on Monarch’s $250.0 million Amended Credit Facility as of December 31, 2018 was $94.5 million.

All interest in the fourth quarter of 2018 was capitalized, compared to $328 thousand of interest expense, net of amounts capitalized, in the fourth quarter of 2017.

Monarch continues to believe that its operating cash flow and the $154.9 million available under its Amended Credit Facility will be sufficient to fund all remaining costs related to the completion of the Monarch Casino Black Hawk expansion, as well as our capital expenditures plans at Atlantis, Reno

Forward-Looking Statements
This press release contains forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended, including, but not limited to, statements relating to (i) our plans, objectives, near- and long-term outlook, opportunities, expectations, growth prospects and future operations with respect to Atlantis Casino Resort Spa and Monarch Casino Black Hawk and the markets in their respective regions; (ii) our plans, costs, financing, and additional expenses and revenue opportunities as a result of project and budget modifications, construction, completion and opening timelines of upgraded, redesigned and/or expanded facilities at Monarch Casino Black Hawk; and (iii) our expectations regarding our future position in the market and the quality of service we provide to our guests. Actual results and future events and conditions may differ materially from those described in any forward-looking statements. Important factors that could cause actual results to differ materially from estimates or projections contained in the forward-looking statements include, without limitation:

  • construction factors, including delays, disruptions, increased costs of labor and materials, contractor disagreements, availability of labor and materials, zoning issues, environmental restrictions, soil and water conditions, weather and other hazards, site access matters, building permit issues and other regulatory approvals or issues;
  • we have not yet entered into a guaranteed maximum price (“GMP”) construction contract with our Monarch Casino Black Hawk general contractor and negotiation of the GMP may involve disagreements between the parties, including potential disagreements over costs of and responsibility for delays and other construction related matters;
  • components of our Monarch Casino Black Hawk construction project will be outside the scope of any GMP contract;
  • access to available and reasonable financing on a timely basis;
  • our ability to generate sufficient operating cash flow to help finance our expansion plans;
  • our ability to effectively manage expenses to optimize its margins and operating results;
  • changes in laws and regulations permitting expanded and other forms of gaming in our key markets;
  • the effects of local and national economic, credit and capital market conditions on the economy in general and on the gaming industry and our business in particular;
  • guest acceptance of our expanded facilities once completed and the resulting impact on our market position, growth and future financial results; and
  • competition in our target market areas

Additional information concerning potential factors that could adversely affect all forward-looking statements, including the Company's financial results, is included in our Securities and Exchange Commission filings, including our most recent annual report on Form 10-K and quarterly report on Form 10-Q, which are available on our website at www.monarchcasino.com.

About Monarch Casino & Resort, Inc.
Monarch Casino & Resort, Inc., through its subsidiaries, owns and operates the Atlantis Casino Resort Spa, a hotel/casino facility in Reno, Nevada, and the Monarch Casino Black Hawk in Black Hawk, Colorado, approximately 40 miles west of Denver. For additional information on Monarch, visit Monarch's website at www.monarchcasino.com.

The Atlantis features approximately 61,000 square feet of casino space; 824 guest rooms; eight food outlets; two espresso and pastry bars; a 30,000 square-foot health spa and salon with an enclosed year-round pool; two retail outlets offering clothing and traditional gift shop merchandise; an 8,000 square-foot family entertainment center; and approximately 52,000 square feet of banquet, convention and meeting room space. The casino features approximately 1,450 slot and video poker machines; approximately 38 table games, including blackjack, craps, roulette, and others; a race and sports book; a 24-hour live keno lounge; and a poker room.

The Monarch Casino Black Hawk features approximately 30,000 square feet of casino space; approximately 740 slot machines; 14 table games; a 250-seat buffet-style restaurant; a snack bar and a new nine-story parking structure with approximately 1,350 spaces, plus additional existing valet parking bringing total parking capacity to 1,500 spaces. Once completed, the Monarch Casino Black Hawk expansion will nearly double the casino space and will add a 23-story hotel tower with approximately 500 guest rooms and suites, an upscale spa and pool facility, three restaurants (bringing the total to four restaurants), additional bars, and associated support facilities.

Contacts:
David Farahi
Chief Operating Officer
775/825-4700 or dfarahi@monarchcasino.com

Joseph Jaffoni, Richard Land, James Leahy
JCIR
212/835-8500 or mcri@jcir.com

- financial tables follow -

 
 
MONARCH CASINO & RESORT, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(In thousands, except per share data)


  Three months ended
December 31,
 Twelve months ended
December 31,
  2018 2017 2018 2017
  (Unaudited) (Unaudited) (Unaudited)  
Revenues        
  Casino $ 31,253  $ 43,378 $ 125,844  $ 178,585
  Food and beverage   18,261   16,022   71,212   63,416
  Hotel   6,870   5,580   30,497   24,784
  Other   3,395   3,428   12,762   12,467
  Gross revenues   59,779   68,408   240,315   279,252
  Less promotional allowances   —   (12,352)   —   (48,526)
  Net revenues   59,779   56,056   240,315   230,726
         
Operating expenses        
  Casino   10,784   18,180   43,791   73,017
  Food and beverage   14,012   6,266   54,002   25,727
   Hotel   3,189   2,128   13,059   9,320
  Other   1,525   1,008   6,206   4,141
  Selling, general and administrative   17,672   16,602   65,802   62,719
  Depreciation and amortization   3,536   3,735   14,617   15,132
  Loss on disposition of assets   —   —   12   4
  Total operating expenses   50,718   47,919   197,489   190,060
         
  Income from operations   9,061   8,137   42,826   40,666
         
Other expenses        
Interest expense, net of amounts capitalized   —    (328)   (177)   (967)
  Total other expense   —   (328)   (177)   (967)
         
  Income before income taxes   9,061   7,809   42,649   39,699
Provision for income taxes   (1,802)   (3,412)   (8,551)   (14,161)
  Net income $ 7,259 $ 4,397 $ 34,098 $ 25,538
         
Earnings per share of common stock        
  Net income        
  Basic $ 0.40 $ 0.25 $ 1.91 $ 1.45
  Diluted $ 0.39 $ 0.23 $ 1.83 $ 1.39
         
Weighted average number of common shares and potential common shares outstanding        
  Basic   17,904   17,717   17,846   17,585
  Diluted   18,566   18,701   18,574   18,367


 
MONARCH CASINO & RESORT, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands, except shares)
 
  December 31, December 31,
  2018 2017
ASSETS (unaudited)  
Current assets    
  Cash and cash equivalents $ 30,462  $ 29,151
  Receivables, net   6,740   6,925
  Income taxes receivable   279 2,008
  Inventories   3,692   3,335
  Prepaid expenses   5,508   4,612
  Total current assets   46,681   46,031
Property and equipment    
  Land    30,034   30,034
  Land improvements   7,645   7,249
  Buildings   193,235   193,286
  Buildings improvements   25,995   24,745
  Furniture and equipment   139,772   140,404
  Construction in progress   180,518   48,834
  Leasehold improvements    3,782   3,800
    580,981   448,352
  Less accumulated depreciation and amortization   (206,657)   (197,638)
  Net property and equipment    374,324   250,714
Other assets    
  Goodwill   25,111   25,111
  Intangible assets, net   2,704   3,869
  Deferred income taxes    4,027   3,544
  Other assets, net   2,280   2,818
  Total other assets   34,122   35,342
  Total  assets $ 455,127  $ 332,087
 

LIABILITIES AND STOCKHOLDERS' EQUITY
    
Current liabilities    
  Accounts payable 11,182 $ 8,184
  Construction accounts payable 17,152   5,823
  Accrued expenses 31,111 25,406
  Total current liabilities   59,445 39,413
Long - term debt 94,500   26,200
  Total liabilities   153,945   65,613
 

Stockholders' equity
    
  Preferred stock, $.01 par value, 10,000,000  shares authorized; none issued - -
  Common stock, $.01 par value, 30,000,000 shares authorized;   191   191
  19,096,300 shares issued; 17,919,021 outstanding at December 31, 2018;    
  17,759,446 outstanding at December 31, 2017    
  Additional paid-in capital   30,111   26,890
  Treasury stock, 1,177,279 shares at December 31, 2018; 1,336,854 shares   (15,876)   (18,123)
  at December 31, 2017    
  Retained earnings   286,756   257,516
Total stockholders' equity   301,182   266,474
Total liabilities and stockholders' equity   455,127  $ 332,087


 
MONARCH CASINO & RESORT, INC. AND SUBSIDIARIES
RECONCILIATION OF POST TO PRE ASC 606 ADOPTION
(In thousands, unaudited)
 
 Three Months Ended December 31, 2018

 Post ASC
606 Adoption
 ASC 606
Changes
  Pre ASC 606
Adoption
Revenues      
Casino  $  31,253   $  15,181(a)(b)(c)(d) $  46,434
Food and beverage  18,261   (1,372)(a)(d)(e)   16,889
Hotel  6,870   (744)(a)(f)   6,126
Other  3,395   62(a)(d)    3,457
Gross revenues  59,779   13,127    72,906
Less promotional allowances  —   (13,712)(a)(d)   (13,712)
Net revenues  59,779   (585)(b)(c)(e)(f)   59,194
       
Operating expenses      
Casino  10,784   8,322(b)(c)(g)   19,106
Food and beverage  14,012   (7,412)(e)(g)   6,600
Hotel  3,189   (947)(f)(g)   2,242
Other  1,525   (548)(g)   977
Selling, general and administrative  17,672   —    17,672
Depreciation and amortization  3,536   —     3,536
Total operating expenses  50,718   (585)    50,133
Income from operations  9,061   —  9,061
Adjusted EBITDA (1)  $  13,435   —    $  13,435
       

(1) Definitions, disclosures and reconciliations of non-GAAP financial information are included later in the release.

(a) Change as a result of reclassification of current period complimentaries at estimated retail price from promotional allowances to casino, food and beverage, hotel, spa and retail revenues.
(b) Change as a result of reclassification of the earned and unused points during the period from casino expense to casino revenue.
(c) Change as a result of reclassification of the wide area progressive system expense from casino revenue to casino expense.
(d) Change as a result of the change of the casino floor bars menu prices and some retail outlets prices from discounted to retail price.
(e) Change as a result of reclassification of the banquets service fees from food and beverage expense to food and beverage revenue.
(f)  Change as a result of reclassification of the group rebates and commissions from hotel expense to hotel revenue.
(g) Change as a result of the elimination of the reclassification journal entry that reclassified the costs of complimentaries from hotel, food and beverage and other expense categories to casino expense. Under ASC 606, the costs of complimentaries stay in the complimentaries revenue producing department.

 
  MONARCH CASINO & RESORT, INC. AND SUBSIDIARIES
  RECONCILIATION OF POST TO PRE ASC 606 ADOPTION
  (In thousands, unaudited)
 
 Twelve Months Ended December 31, 2018

 Post ASC
606 Adoption
 ASC 606
Changes
  Pre ASC 606
Adoption
Revenues      
Casino  $  125,844   $  59,522(a)(b)(c)(d) $  185,366
Food and beverage  71,212   (5,600)(a)(d)(e)   65,612
Hotel  30,497   (4,158)(a)(f)   26,339
Other  12,762   143(a)(d)   12,905
Gross revenues  240,315   49,907    290,222
Less promotional allowances  —   (50,843)(a)(d)   (50,843)
Net revenues  240,315   (936)(b)(c)(e)(f)   239,379
       
Operating expenses      
Casino  43,791   33,174(b)(c)(g)   76,965
Food and beverage  54,002   (28,550)(e)(g)   25,452
Hotel  13,059   (3,428)(f)(g)   9,631
Other  6,206   (2,132)(g)   4,074
Selling, general and administrative  65,802   —    65,802
Depreciation and amortization  14,617   —    14,617
Loss on disposal of assets  12   —    12
Total operating expenses  197,489   (936)    196,553
Income from operations  42,826   —  42,826
Adjusted EBITDA (1)  $  60,586    —  $  60,586
       

(1) Definitions, disclosures and reconciliations of non-GAAP financial information are included later in the release.
(h) Change as a result of reclassification of current period complimentaries at estimated retail price from promotional allowances to casino, food and beverage, hotel, spa and retail revenues.
(i)  Change as a result of reclassification of the earned and unused points during the period from casino expense to casino revenue.
(j)  Change as a result of reclassification of the wide area progressive system expense from casino revenue to casino expense.
(k) Change as a result of the change of the casino floor bars menu prices and some retail outlets prices from discounted to retail price.
(l)  Change as a result of reclassification of the banquets service fees from food and beverage expense to food and beverage revenue.
(m) Change as a result of reclassification of the group rebates and commissions from hotel expense to hotel revenue.
(n) Change as a result of the elimination of the reclassification journal entry that reclassified the costs of complimentaries from hotel, food and beverage and other expense categories to casino expense. Under ASC 606, the costs of complimentaries stay in the complimentaries revenue producing department.

MONARCH CASINO & RESORT, INC. AND SUBSIDIARIES
RECONCILIATION OF ADJUSTED EBITDA TO NET INCOME
 (In thousands, unaudited)

The following table sets forth a reconciliation of Adjusted EBITDA, a non-GAAP financial measure, to net income, a GAAP financial measure:

 Three Months
Ended December 31,
 Twelve Months
Ended December 31,
 2018 2017 2018 2017
  Adjusted EBITDA (1) $13,435  $12,589 $60,586 $58,046
Expenses:       
Stock based compensation(838) (717) (3,131) (2,244)
Depreciation and amortization(3,536) (3,735) (14,617) (15,132)
Interest expense, net of amount capitalized  — (328) (177) (967)
Loss on disposition of assets  (12) (4)
Revaluation of deferred tax asset due to enactment of the Tax Cut and Jobs Act (1,461)  (1,461)
Provision for income taxes(1,802) (1,951) (8,551) (12,700)
Net income $7,259  $4,397 $34,098 $25,538

(2) Adjusted EBITDA, a non-GAAP financial measure, consists of net income plus loss on disposal of assets, provision for income taxes, stock based compensation expense, other one-time charges, interest expense, depreciation and amortization less interest income, any benefit for income taxes and gain on disposal of assets. Adjusted EBITDA should not be construed as an alternative to operating income (as determined in accordance with US GAAP), as an indicator of the Company's operating performance, as an alternative to cash flows from operating activities (as determined in accordance with US GAAP) or as a measure of liquidity. This measure enables comparison of the Company's performance over multiple periods, as well as against the performance of other companies in our industry that report Adjusted EBITDA, although some companies do not calculate this measure in the same manner and, therefore, the measure as presented may not be comparable to similarly titled measures presented by other companies.


The following information was filed by Monarch Casino Resort Inc (MCRI) on Thursday, February 21, 2019 as an 8K 2.02 statement, which is an earnings press release pertaining to results of operations and financial condition. It may be helpful to assess the quality of management by comparing the information in the press release to the information in the accompanying 10-K Annual Report statement of earnings and operation as management may choose to highlight particular information in the press release.
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