Document and Entity Information
Document and Entity Information - shares | 6 Months Ended | |
Jun. 30, 2018 | Aug. 06, 2018 | |
Document and Entity Information [Abstract] | ||
Entity Registrant Name | FULL HOUSE RESORTS INC | |
Entity Central Index Key | 891,482 | |
Trading Symbol | fll | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Smaller Reporting Company | |
Entity Common Stock, Shares Outstanding | 26,932,169 | |
Document Type | 10-Q | |
Document Period End Date | Jun. 30, 2018 | |
Amendment Flag | false | |
Document Fiscal Year Focus | 2,018 | |
Document Fiscal Period Focus | Q2 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | ||
Revenues | |||||
Casino | [1] | $ 28,632 | $ 35,787 | $ 55,602 | $ 71,693 |
Food and beverage | [1] | 8,783 | 8,100 | 16,722 | 15,999 |
Hotel | [1] | 2,582 | 2,237 | 4,865 | 4,315 |
Other operations | 1,230 | 1,243 | 1,969 | 2,017 | |
Gross revenues | 41,227 | 47,367 | 79,158 | 94,024 | |
Less promotional allowances | [1] | 0 | (7,246) | 0 | (14,283) |
Net revenues | 41,227 | 40,121 | 79,158 | 79,741 | |
Operating costs and expenses | |||||
Casino | [1] | 11,282 | 18,874 | 22,366 | 37,454 |
Food and beverage | [1] | 9,757 | 3,160 | 18,883 | 6,132 |
Hotel | [1] | 2,652 | 276 | 5,139 | 478 |
Other operations | [1] | 834 | 571 | 1,348 | 851 |
Selling, general and administrative | [1] | 12,462 | 13,728 | 24,424 | 26,812 |
Project development and acquisition costs | 130 | 53 | 167 | 185 | |
Depreciation and amortization | 2,038 | 2,138 | 4,206 | 4,235 | |
Loss (gain) on disposal of assets, net | 69 | (14) | 79 | (1) | |
Total operating costs and expenses | 39,224 | 38,786 | 76,612 | 76,146 | |
Operating income | 2,003 | 1,335 | 2,546 | 3,595 | |
Other (expense) income | |||||
Interest expense, net of $171 and $216 capitalized for the three and six months ended June 30, 2018 | (2,466) | (2,705) | (5,006) | (5,384) | |
Loss on extinguishment of debt | 0 | 0 | (2,673) | 0 | |
Adjustment to fair value of warrants | (80) | 30 | 423 | 30 | |
Total other (expense) income | (2,546) | (2,675) | (7,256) | (5,354) | |
Loss before income taxes | (543) | (1,340) | (4,710) | (1,759) | |
Provision for income taxes | 118 | 184 | 237 | 368 | |
Net loss | $ (661) | $ (1,524) | $ (4,947) | $ (2,127) | |
Basic loss per share (in dollars per share) | $ (0.02) | $ (0.07) | $ (0.20) | $ (0.09) | |
Diluted loss per share (in dollars per share) | $ (0.02) | $ (0.07) | $ (0.21) | $ (0.09) | |
[1] | On January 1, 2018, the Company adopted Accounting Standards Codification No. 606, Revenue from Contracts with Customers (“ASC 606”), using the modified retrospective method, which impacts the comparability of these line items. |
CONSOLIDATED STATEMENTS OF OPE3
CONSOLIDATED STATEMENTS OF OPERATIONS (Phantom) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended |
Jun. 30, 2018 | Jun. 30, 2018 | |
Income Statement [Abstract] | ||
Interest costs capitalized | $ 171 | $ 216 |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Jun. 30, 2018 | Dec. 31, 2017 |
Current assets | ||
Cash and equivalents | $ 22,726 | $ 19,910 |
Accounts receivable, net of allowance of $105 and $103 | 1,530 | 1,760 |
Inventories | 1,551 | 1,692 |
Prepaid expenses and other | 4,644 | 2,849 |
Total current assets | 30,451 | 26,211 |
Other long-term assets | ||
Property and equipment, net | 117,661 | 114,058 |
Goodwill | 21,286 | 21,286 |
Intangible assets, net of accumulated amortization of $7,779 and $7,763 | 10,926 | 10,936 |
Deposits and other | 1,031 | 994 |
Total assets | 181,355 | 173,485 |
Current liabilities | ||
Accounts payable | 5,927 | 5,182 |
Accrued payroll and related | 3,864 | 3,115 |
Other accrued expenses | 7,955 | 8,846 |
Common stock warrant liability | 2,074 | 0 |
Current portion of long-term debt | 1,000 | 1,000 |
Current portion of capital lease obligation | 451 | 421 |
Total current liabilities | 21,271 | 18,564 |
Other long-term obligations | 179 | 2,689 |
Long-term debt, net of current portion | 94,362 | 93,566 |
Capital lease obligation, net of current portion | 4,605 | 4,861 |
Deferred tax liability | 1,994 | 1,757 |
Total liabilities | 122,411 | 121,437 |
Commitments and contingencies (Notes 6, 7 and 9) | ||
Stockholders’ equity | ||
Common stock, $0.0001 par value, 100,000,000 shares authorized; 28,288,764 and 24,294,084 shares issued and 26,932,169 and 22,937,489 shares outstanding | 3 | 2 |
Additional paid-in capital | 63,710 | 51,868 |
Treasury stock, 1,356,595 common shares | (1,654) | (1,654) |
Retained earnings (deficit) | (3,115) | 1,832 |
Total stockholders' equity | 58,944 | 52,048 |
Total liabilities and stockholders' equity | $ 181,355 | $ 173,485 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parentheticals) - USD ($) $ in Thousands | Jun. 30, 2018 | Dec. 31, 2017 |
Statement of Financial Position [Abstract] | ||
Allowance for doubtful accounts | $ 105 | $ 103 |
Accumulated amortization of intangible assets | $ 7,779 | $ 7,763 |
Common stock, par value (in dollars per share) | $ 0.0001 | $ 0.0001 |
Common stock, shares authorized (in shares) | 100,000,000 | 100,000,000 |
Common stock, shares issued (in shares) | 28,288,764 | 24,294,084 |
Common stock, shares outstanding (in shares) | 26,932,169 | 22,937,489 |
Treasury stock, common shares (in shares) | 1,356,595 | 1,356,595 |
CONSOLIDATED STATEMENT OF STOCK
CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY (Unaudited) - 6 months ended Jun. 30, 2018 - USD ($) shares in Thousands, $ in Thousands | Total | Common Stock | Additional Paid-in Capital | Treasury Stock | Retained Earnings (Deficit) |
Balance (in shares) at Dec. 31, 2017 | 24,294 | 1,357 | |||
Balance at Dec. 31, 2017 | $ 52,048 | $ 2 | $ 51,868 | $ (1,654) | $ 1,832 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Stock grants (in shares) | 34 | ||||
Stock grants | $ 104 | 104 | |||
Registered direct offering (in shares) | 3,943 | ||||
Registered direct offering | 11,436 | $ 1 | 11,435 | ||
Share-based compensation (in shares) | 18 | ||||
Share-based compensation | 303 | 303 | |||
Net loss | (4,947) | (4,947) | |||
Balance (in shares) at Jun. 30, 2018 | 28,289 | 1,357 | |||
Balance at Jun. 30, 2018 | $ 58,944 | $ 3 | $ 63,710 | $ (1,654) | $ (3,115) |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2018 | Jun. 30, 2017 | |
Cash flows from operating activities: | ||
Net loss | $ (4,947) | $ (2,127) |
Adjustments to reconcile net loss to net cash provided by operating activities: | ||
Depreciation and amortization | 4,206 | 4,235 |
Amortization of debt issuance and warrant costs | 398 | 439 |
Share-based compensation | 407 | 269 |
Change in fair value of stock warrants | (423) | (30) |
Debt extinguishment costs | 2,673 | 0 |
Loss (gain) on disposal of assets and other | 80 | (14) |
Increases and decreases in operating assets and liabilities: | ||
Accounts receivable | 230 | 711 |
Prepaid expenses, inventories and other | (1,652) | (1,985) |
Deferred taxes | 237 | 367 |
Accounts payable and accrued expenses | (538) | 458 |
Net cash provided by operating activities | 671 | 2,323 |
Cash flows from investing activities: | ||
Purchase of property and equipment | (6,744) | (6,252) |
Other | (234) | (40) |
Net cash used in investing activities | (6,978) | (6,292) |
Cash flows from financing activities: | ||
Payment of First and Second Lien Term Loans | (96,063) | (563) |
Prepayment premium of Second Lien Term Loan | (1,100) | 0 |
Proceeds from Senior Secured Notes borrowings | 100,000 | 0 |
Payment of debt issuance costs | (4,044) | (281) |
Payment of Interest Rate Cap premium | (238) | 0 |
Repayment of Senior Secured Notes principal | (500) | 0 |
Repayment of capital lease obligation | (226) | (224) |
Proceeds from equity offering | 11,435 | 0 |
Other | (141) | 0 |
Net cash provided by (used in) financing activities | 9,123 | (1,068) |
Net increase (decrease) in cash and equivalents | 2,816 | (5,037) |
Cash and equivalents, beginning of period | 19,910 | 27,038 |
Cash and equivalents, end of period | 22,726 | 22,001 |
SUPPLEMENTAL CASH FLOW INFORMATION: | ||
Cash paid for interest, net of amounts capitalized | 4,717 | 4,871 |
NON-CASH INVESTING AND FINANCING ACTIVITIES: | ||
Accounts payable related capital expenditures | $ 2,073 | $ 1,100 |
ORGANIZATION
ORGANIZATION | 6 Months Ended |
Jun. 30, 2018 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
ORGANIZATION | ORGANIZATION Organization. Formed as a Delaware corporation in 1987, Full House Resorts, Inc. owns, leases, operates, develops, manages, and/or invests in casinos and related hospitality and entertainment facilities. References in this document to “Full House”, the “Company”, “we”, “our”, or “us” refer to Full House Resorts, Inc. and its subsidiaries, except where stated or the context otherwise indicates. We currently operate five casinos; four are part of real estate that we own or lease and one is located within a hotel owned by a third party. The following table identifies the properties along with their respective dates of acquisition and locations: Property Acquisition Location Silver Slipper Casino and Hotel 2012 Hancock County, MS Bronco Billy’s Casino and Hotel 2016 Cripple Creek, CO Rising Star Casino Resort 2011 Rising Sun, IN Stockman’s Casino 2007 Fallon, NV Grand Lodge Casino (leased and part of the Hyatt Regency Lake Tahoe Resort, Spa and Casino) 2011 Incline Village, NV We manage our casinos based on geographic regions within the United States. See Note 12 for further information. |
BASIS OF PRESENTATION AND SIGNI
BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES | 6 Months Ended |
Jun. 30, 2018 | |
Accounting Policies [Abstract] | |
BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES | BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES Basis of Presentation. As permitted by the rules and regulations of the Securities and Exchange Commission, certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles in the United States of America (“GAAP”) have been condensed or omitted. These consolidated financial statements should be read in conjunction with the Company’s 2017 annual consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2017 . The interim consolidated financial statements of the Company included herein reflect all adjustments (consisting of normal recurring adjustments) that are, in the opinion of management, necessary to present fairly the financial position and results of operations for the interim periods presented. The results of operations for the interim periods are not necessarily indicative of annualized results for an entire year. The consolidated financial statements include the accounts of Full House and its wholly-owned subsidiaries. All intercompany accounts and transactions have been eliminated in consolidation. Fair Value and the Fair Value Input Hierarchy. Fair value measurements affect our accounting for net assets acquired in acquisition transactions and certain financial assets and liabilities, such as our interest rate cap (“Interest Rate Cap”) agreement and common stock warrant liability. Fair value measurements are also used in our periodic assessments of long-lived tangible and intangible assets for possible impairment, including for property and equipment, goodwill, and other intangible assets. Fair value is defined as the expected price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. GAAP categorizes the inputs used for fair value into a three-level hierarchy: • Level 1: Observable inputs, such as quoted prices in active markets for identical assets or liabilities; • Level 2: Comparable inputs other than quoted prices that are observable for similar assets or liabilities in less active markets; and • Level 3: Unobservable inputs which may include metrics that market participants would use to estimate values, such as revenue and earnings multiples and relative rates of return. The Company utilizes Level 2 inputs when measuring the fair value of its Interest Rate Cap. In order to estimate the fair value of this derivative instrument, the Company obtains valuation reports from the third-party broker that issued the Interest Rate Cap. The report contemplates fair value by using inputs including market-observable data such as interest rate curves, volatilities, and information derived from or corroborated by that market-observable data (see Note 6). The Company utilizes Level 3 inputs when measuring the fair value of net assets acquired in business combination transactions, subsequent assessments for impairment, and most financial instruments, including but not limited to the estimated fair value of common stock warrants at issuance and for recurring changes in the related warrant liability (see Note 7). Operating Revenues and Related Costs and Expenses. The Company adopted a new revenue standard (see Note 3) effective January 1, 2018. The Company’s revenues consist primarily of casino gaming, food and beverage, hotel, and other revenues (such as entertainment). The majority of our revenues are derived from casino gaming, principally slot machines. Gaming revenue is the difference between gaming wins and losses, not the total amount wagered. We account for our gaming transactions on a portfolio basis as such wagers have similar characteristics and it would not be practical to view each wager on an individual basis. We sometimes provide discretionary complimentary goods and services (“Discretionary Comps”). For these types of transactions, we allocate revenue to the department providing the complimentary goods or services based upon its estimated standalone selling price, offset by a reduction in casino revenues. Some of our customers choose to earn points under our customer loyalty programs. As points are accrued, we defer a portion of our gaming revenue based on the estimated standalone value of loyalty points being earned by the customer. The standalone value of loyalty points is derived from the retail value of food, beverages, hotel rooms, and other goods or services for which such points may be redeemed. A liability related to these customer loyalty points is recorded, net of estimated breakage and other factors, until the customer redeems these points, primarily for “free casino play/cash back,” complimentary dining, or hotel stays. Upon redemption, the related revenue is recognized at retail value within the department providing the goods or services. Revenue for food and beverage, hotel, and other revenue transactions is typically the net amount collected from the customer for such goods and services, plus the retail value of (i) discretionary comps and (ii) comps provided in return for redemption of loyalty points. We record such revenue as the good or service is transferred to the customer. Additionally, we may collect deposits in advance for future hotel reservations or entertainment, among other services, which represent obligations to the Company until the service is provided to the customer. Other notable changes of the new revenue recognition standard include: • The Company no longer presents a promotional allowances line item on its consolidated statement of operations, as revenues are now allocated between casino revenue and other revenue categories. • The Company no longer reclassifies the estimated cost of complimentaries provided to a gaming customer from other expense categories to casino operating expenses. Income Taxes. For interim income tax reporting, it was determined that the Company’s annual effective tax rate could not be reasonably estimated. As a result, the Company used the actual year-to-date effective tax rate to determine the tax expense incurred during the three and six months ended June 30, 2018 and 2017 . Reclassifications. We made certain minor reclassifications to prior-period amounts to conform to the current-period presentation. Such reclassifications had no effect on the previously reported net loss or stockholders’ equity. Earnings (Loss) Per Share. Earnings (loss) per share is net income (loss) applicable to common stock divided by the weighted average number of common shares outstanding during the period. Diluted earnings per share reflects additional dilutive effects for all potentially-dilutive securities, including common stock options and warrants, using the treasury stock method. |
NEW ACCOUNTING PRONOUNCEMENTS
NEW ACCOUNTING PRONOUNCEMENTS | 6 Months Ended |
Jun. 30, 2018 | |
Accounting Changes and Error Corrections [Abstract] | |
NEW ACCOUNTING PRONOUNCEMENTS | NEW ACCOUNTING PRONOUNCEMENTS New Accounting Pronouncements Implemented Statement of Cash Flows. In January 2018, the Company adopted Accounting Standards Update (“ASU”) No. 2016-15, “Statement of Cash Flows: Classification of Certain Cash Receipts and Cash Payments,” otherwise referred as “ASU 2016-15.” ASU 2016-15 amends the guidance of Accounting Standards Codification (“ASC”) Topic 230 on the classification of certain cash receipts and payments in the statement of cash flows. The primary purpose of ASU 2016-15 is to reduce the diversity in practice that has resulted from the lack of consistent principles, specifically clarifying the guidance on eight cash flow issues. The adoption did not and is not expected to have a material impact on our consolidated financial statements. Revenue from Contracts with Customers. In January 2018, the Company adopted ASC 606, Revenue from Contracts with Customers (“ASC 606”) using the modified retrospective method, which applies to all contracts that are written, oral or implied by customary business practices. The comparative information as of and for the three and six months ended June 30, 2017 has not been restated and continues to be reported under the accounting standards in effect for that period. The adoption of ASC 606 for 2018 has not and is not expected to have an aggregate material impact on operating income, net income, or cash flows on an ongoing basis. The impact of adoption on our consolidated statement of operations is shown below. Note that we did not present any balance sheet effects, as the amounts are immaterial. (In thousands, unaudited) Three Months Ended June 30, 2018 Statement of Operations As Reported Balances without Adoption of ASC 606 Effect of Change Higher/(Lower) Revenues Casino $ 28,632 $ 36,713 $ (8,081 ) Food and beverage 8,783 8,704 79 Hotel 2,582 2,376 206 Promotional allowances — (7,733 ) 7,733 Costs and expenses Casino 11,282 18,675 (7,393 ) Food and beverage 9,757 3,124 6,633 Hotel 2,652 389 2,263 Other operations 834 505 329 Selling, general and administrative 12,462 14,352 (1,890 ) Operating income 2,003 2,008 (5 ) Loss before income taxes (543 ) (538 ) (5 ) Net loss (661 ) (656 ) (5 ) (In thousands, unaudited) Six Months Ended June 30, 2018 Statement of Operations As Reported Balances without Adoption of ASC 606 Effect of Change Higher/(Lower) Revenues Casino $ 55,602 $ 71,226 $ (15,624 ) Food and beverage 16,722 16,584 138 Hotel 4,865 4,459 406 Promotional allowances — (14,653 ) 14,653 Costs and expenses Casino 22,366 36,945 (14,579 ) Food and beverage 18,883 6,190 12,693 Hotel 5,139 618 4,521 Other operations 1,348 827 521 Selling, general and administrative 24,424 27,982 (3,558 ) Operating income 2,546 2,571 (25 ) Loss before income taxes (4,710 ) (4,685 ) (25 ) Net loss (4,947 ) (4,922 ) (25 ) New Accounting Pronouncements to be Implemented Leases. In February 2016, the FASB issued ASU No. 2016-02, “Leases (Topic 842),” (“ASU 2016-02”), which replaces the existing guidance in ASC 840, Leases. ASU 2016-02 is effective for fiscal years, and interim periods within those years, beginning after December 15, 2018. ASU 2016-02 requires a dual approach for lessee accounting under which a lessee would account for leases as finance leases or operating leases. Both finance leases and operating leases will result in the lessee recognizing a right-of-use asset and a corresponding lease liability. The Company is currently assessing the impact that adoption of this guidance will have on its consolidated financial statements and footnote disclosures. Management believes that there are no other recently-issued accounting standards not yet effective that are currently likely to have a material impact on our financial statements. |
REVENUE
REVENUE | 6 Months Ended |
Jun. 30, 2018 | |
Revenue from Contract with Customer [Abstract] | |
REVENUE | REVENUE Our revenue, disaggregated by type of revenue and segment, is as follows: (In thousands, unaudited) Three Months Ended June 30, 2018 Silver Slipper Casino and Hotel Rising Star Casino Resort Bronco Billy’s Casino and Hotel Northern Nevada Casinos Total Revenues Casino $ 11,438 $ 7,974 $ 5,373 $ 3,847 $ 28,632 Food and beverage 4,824 2,291 1,182 486 8,783 Hotel 835 1,586 161 — 2,582 Other operations 395 677 79 79 1,230 $ 17,492 $ 12,528 $ 6,795 $ 4,412 $ 41,227 (In thousands, unaudited) Six Months Ended June 30, 2018 Silver Slipper Casino and Hotel Rising Star Casino Resort Bronco Billy’s Casino and Hotel Northern Nevada Casinos Total Revenues Casino $ 22,488 $ 15,499 $ 10,347 $ 7,268 $ 55,602 Food and beverage 9,169 4,348 2,258 947 16,722 Hotel 1,612 2,974 279 — 4,865 Other operations 732 934 153 150 1,969 $ 34,001 $ 23,755 $ 13,037 $ 8,365 $ 79,158 We have accruals for certain liabilities with customers, including liabilities for our customer loyalty programs and progressive jackpot liabilities. Such liabilities were approximately $3.2 million for each of June 30, 2018 and December 31, 2017 . |
PROPERTY AND EQUIPMENT
PROPERTY AND EQUIPMENT | 6 Months Ended |
Jun. 30, 2018 | |
Property, Plant and Equipment [Abstract] | |
PROPERTY AND EQUIPMENT | PROPERTY AND EQUIPMENT Property and equipment, including capital lease assets, consists of the following: (In thousands) June 30, December 31, (Unaudited) Land and improvements $ 15,927 $ 15,376 Buildings and improvements 108,874 106,728 Furniture and equipment 42,764 41,281 Construction in progress 6,225 2,723 173,790 166,108 Less: Accumulated depreciation (56,129 ) (52,050 ) $ 117,661 $ 114,058 |
LONG-TERM DEBT AND CAPITAL LEAS
LONG-TERM DEBT AND CAPITAL LEASE | 6 Months Ended |
Jun. 30, 2018 | |
Debt Disclosure [Abstract] | |
LONG-TERM DEBT AND CAPITAL LEASE | LONG-TERM DEBT AND CAPITAL LEASE Long-Term Debt Long-term debt, related discounts and issuance costs consist of the following: (In thousands) June 30, December 31, 2017 (Unaudited) Senior Secured Notes $ 99,500 $ — First Lien Term Loan — 41,063 Revolving Loan — — Second Lien Term Loan — 55,000 99,500 96,063 Less: Discounts and unamortized debt issuance costs (4,138 ) (1,497 ) 95,362 94,566 Less: Current portion of long-term debt (1,000 ) (1,000 ) $ 94,362 $ 93,566 Senior Secured Notes. On February 2, 2018, we sold $100 million of senior secured notes due 2024 (the “Notes”) to qualified institutional buyers. The Notes were issued on the same day at a price of 98% of their face value (a 2% original issue discount). Proceeds from the Notes were used to (i) pay fees and expenses incurred in connection with the debt offering; (ii) refinance the entire amounts outstanding under the First and Second Lien Credit Facilities; (iii) provide ongoing working capital; and (iv) provide funds for capital expenditures and for general corporate purposes. As of February 2, 2018, immediately prior to the issuance of the Notes, we had approximately $41 million outstanding under the First Lien Credit Facility and approximately $55 million outstanding under the Second Lien Credit Facility, which were extinguished at a loss of $2.7 million , reflecting the call premiums on such debt and the write-off of unamortized debt issuance costs. The Notes bear interest at the greater of the three-month London Interbank Offered Rate (“LIBOR”) or 1.0% , plus a margin rate of 7.0% . Interest on the Notes is payable quarterly in arrears, on March 31, June 30, September 30 and December 31 of each year until the Notes mature on February 2, 2024. On each interest payment date, we are required to make principal payments of $250,000 with a balloon payment for the remaining $94 million due upon maturity. At any time prior to February 2, 2019, the Company may redeem all or a part of the Notes at a redemption price equal to 100% of the principal amount of Notes redeemed, plus the “Applicable Premium” (as defined in the indenture governing the Notes and similar to a “make whole” provision) and accrued and unpaid interest. On or after February 2, 2019, the Company may redeem all or a part of the Notes plus the premium as set forth below, plus accrued and applicable unpaid interest: Redemption Periods Percentage Premium On February 2, 2019 to February 1, 2020 2.0% On February 2, 2020 to February 1, 2021 1.5% On February 2, 2021 to February 1, 2022 0.5% On or after February 2, 2022 —% The Notes are collateralized by substantially all of our assets and are guaranteed by all of our material subsidiaries. Interest Rate Cap Agreement. In April 2018, the Company purchased an Interest Rate Cap from Capital One, N.A. for $238,000 in order to manage expected interest rate increases on the Notes. The agreement is for a notional amount of $50 million and expires on March 31, 2021. The Interest Rate Cap has a strike rate of 3.00% and resets every three months at the end of March, June, September, and December. If the three-month LIBOR exceeds the strike rate at the end of any covered period, the Company will receive cash payments from Capital One. Based on fair value measurements using Level 2 inputs (see Note 2), the Company adjusts the carrying value of the Interest Rate Cap quarterly. Since the Company did not elect for hedge accounting, any adjustments to the carrying value between reporting periods will be charged to interest expense on the consolidated statement of operations. In order to estimate the fair value of this derivative instrument, the Company obtains valuation reports from the third-party issuer of the Interest Rate Cap. Fair value of the Company’s Interest Rate Cap at June 30, 2018 was $236,877 and is presented on the consolidated balance sheet under non-current assets as “Deposits and other”. Covenants . The indenture governing the Notes contains customary representations and warranties, events of default, and positive and negative covenants, including financial covenants. We are required to maintain a total leverage ratio (as defined below), which measures Consolidated EBITDA (as defined in the indenture) against outstanding debt. We are allowed to deduct up to $15 million of our cash and equivalents (beyond estimated cash utilized in daily operations) in calculating the numerator of such ratio. Four Fiscal Quarters Ending Maximum Total Leverage Ratio June 30, 2018 5.50 to 1.00 September 30, 2018 5.50 to 1.00 December 31, 2018 5.25 to 1.00 March 31, 2019 5.00 to 1.00 June 30, 2019 5.00 to 1.00 September 30, 2019 4.75 to 1.00 December 31, 2019 4.75 to 1.00 March 31, 2020 4.50 to 1.00 June 30, 2020 4.50 to 1.00 September 30, 2020 4.25 to 1.00 December 31, 2020 4.25 to 1.00 March 31, 2021 4.25 to 1.00 June 30, 2021 4.25 to 1.00 September 30, 2021 and the last day of each fiscal quarter thereafter 4.00 to 1.00 We were in compliance with our covenants as of June 30, 2018 . However, there can be no assurances that we will remain in compliance with all covenants in the future and/or that we would be successful in obtaining waivers or modifications in the event of noncompliance. Capital Lease Our Indiana subsidiary, Gaming Entertainment (Indiana) LLC, leases a 104 -room hotel at Rising Star Casino Resort. At any time during the lease term, we have the option to purchase the hotel at a price based upon the project’s actual cost of $7.7 million , reduced by the cumulative principal payments made by the Company during the lease term. At June 30, 2018 , such net amount was $5.1 million . Upon expiration of the lease term in October 2027, (i) the Landlord has the right to sell the hotel to us, and (ii) we have the option to purchase the hotel. In either case, the purchase price is $1 plus closing costs. |
COMMON STOCK WARRANT LIABILITY
COMMON STOCK WARRANT LIABILITY | 6 Months Ended |
Jun. 30, 2018 | |
Other Liabilities Disclosure [Abstract] | |
COMMON STOCK WARRANT LIABILITY | COMMON STOCK WARRANT LIABILITY The refinancing disclosed in Note 6 is considered a “triggering event” for the possible redemption or registration of the warrants, as further detailed below. The Company’s warrant-holders have not yet requested the redemption or registration of their outstanding warrants, though they may do so on any six-month anniversary of the refinancing date prior to warrant expiration. Accordingly, the obligation is reflected as a current liability as of June 30, 2018 . As part of the Company’s former Second Lien Credit Facility, on May 13, 2016, the Company granted the Second Lien Credit Facility lenders 1,006,568 warrants. The warrants have an exercise price of $1.67 and expire on May 13, 2026. The warrants also provide for redemption rights, preemptive rights under certain circumstances to maintain their ownership interest in the Company, piggyback registration rights and mandatory registration rights after two years. In addition to a refinancing, the redemption rights allow the warrant-holders, at their option, to require the Company to repurchase all or a portion of the warrants upon the occurrence of certain events, including: (i) a liquidity event, as defined in the warrant purchase agreement, or (ii) the Company’s insolvency. The repurchase value is the 21 -day average price of the Company’s common stock at the time of such liquidity event, net of the warrant exercise price. If the redemption rights are exercised, the repurchase amount is payable by the Company in cash or through the issuance of an unsecured note with a four -year term and a minimum interest rate of 13.25% , as further defined in the warrant purchase agreement, and would be guaranteed by the Company’s subsidiaries. Alternatively, the warrant-holders may choose to have the Company register and sell the shares related to the warrants through a public stock offering. We measure the fair value of the warrants at each reporting period. Due to the variable terms regarding the timing of the settlement of the warrants, the Company utilized a “Monte Carlo” simulation approach to measure the fair value of the warrants. The simulation included certain estimates by Company management regarding the estimated timing of the settlement of the warrants. Significant increases or decreases in those management estimates would result in a significantly higher or lower fair value measurement. At June 30, 2018 , the simulation included the following assumptions: an expected contractual term of 7.87 years, an expected stock price volatility rate of 43.00% , an expected dividend yield of 0% , and an expected risk-free interest rate of 2.82% . The common stock warrant liability at June 30, 2018 was $2.1 million compared to $2.5 million at December 31, 2017 . |
INCOME TAXES
INCOME TAXES | 6 Months Ended |
Jun. 30, 2018 | |
Income Tax Disclosure [Abstract] | |
INCOME TAXES | INCOME TAXES The Company’s effective income tax rate for the three and six months ended June 30, 2018 was (21.9)% and (5.0)% , respectively, compared to an effective income tax rate of (13.7)% and (20.9)% in the corresponding prior-year periods. Our tax rate differs from the statutory rate of 21.0% primarily due to the effects of valuation allowances against net deferred tax assets, as well as certain permanent item differences between tax and financial reporting purposes. On December 22, 2017, the U.S. government enacted comprehensive tax legislation commonly referred to as the Tax Cuts and Jobs Act (the “2017 Tax Act”). The 2017 Tax Act establishes new tax laws that will affect 2018 and beyond, including, but not limited to: (i) reduction of the U.S. federal corporate tax rate from 35% to 21%; (ii) elimination of the corporate alternative minimum tax; (iii) limitations on the deductibility of interest expense; (iv) limitations on the deductibility of certain executive compensation; and (v) limitations on the use of net operating losses (“NOLs”) generated after December 31, 2017 to reduce taxable income. The SEC staff issued Staff Accounting Bulletin (“SAB”) 118, which provides guidance on accounting for the tax effects of the 2017 Tax Act. SAB 118 provides a measurement period that should not extend beyond one year from the 2017 Tax Act enactment date for companies to complete the accounting under Accounting Standards Codification (“ASC”) 740. In accordance with SAB 118, a company must reflect the income tax effects of those aspects of the 2017 Tax Act for which the accounting under ASC 740 is complete. To the extent that a company’s accounting for certain income tax effects of the 2017 Tax Act is incomplete but it is able to determine a reasonable estimate, it must record a provisional estimate in the financial statements. If a company cannot determine a provisional estimate to be included in the financial statements, it should continue to apply ASC 740 on the basis of the provisions of the tax laws that were in effect immediately before the enactment of the 2017 Tax Act. As of June 30, 2018 , the Company was able to reasonably estimate the effects of the 2017 Tax Act and recorded provisional adjustments associated with the effects on existing deferred tax balances. The Company will continue to make and refine its calculations as additional analysis is completed and further guidance is provided. The provisional amount recorded related to the remeasurement of its deferred tax balance at December 31, 2017 remains unchanged as of June 30, 2018 . We do not expect to pay any federal income taxes or receive any federal tax refunds related to our 2018 results. Tax losses incurred in 2018 may shelter taxable income in future years. However, because of the level of uncertainty regarding sufficient prospective income, we maintain a valuation allowance against our remaining deferred tax assets. |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 6 Months Ended |
Jun. 30, 2018 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENCIES | COMMITMENTS AND CONTINGENCIES Litigation We are party to a number of pending legal proceedings related to matters that occurred in the normal course of business. Management does not expect that the outcome of any such proceedings, either individually or in the aggregate, will have a material effect on our financial position, results of operations and cash flows. Options to Purchase or Lease Land and Buildings During November 2017, the Company capitalized $0.2 million of costs for options to either purchase or lease various buildings and land in Cripple Creek, Colorado, near Bronco Billy’s. The options include: • an option to purchase or lease land consisting of a closed casino. The Company exercised the lease option during the second quarter of 2018, with an anticipated lease start in August 2018. The lease includes a minimum three -year term with annual lease payments of $0.2 million , and can be extended by an additional two years with annual lease payments of $0.3 million . The Company can also purchase the casino prior to lease-end at a price that increases over time, with a purchase price of $2.5 million if bought by October 31, 2019, and increasing by $0.1 million on each anniversary thereafter up to $2.8 million ; • an option to purchase land improved with a hotel for $1.7 million , which the Company exercised during the second quarter of 2018 and now owns; and • an option to purchase land for $0.3 million , which the Company exercised during the first quarter of 2018 and now owns. The Company also had a short-term lease on a parking lot behind Bronco Billy’s that included an option to purchase the lot for $1.2 million . The Company exercised its right to purchase such land on June 20, 2018 and expects to close on the purchase in the third quarter of 2018. Operating Leases In addition to the following leases, we have less-significant operating leases for certain office and warehouse facilities, office equipment, signage and land. Silver Slipper Casino Land Lease through April 2058 and Options to Purchase. In 2004, our subsidiary, Silver Slipper Casino Venture, LLC, entered into a land lease with Cure Land Company, LLC for approximately 31 acres of marshlands and a seven -acre parcel on which the Silver Slipper Casino and Hotel is situated. The land lease includes base monthly payments of $77,500 plus contingent rents of 3% of monthly gross gaming revenue (as defined in the lease agreement) in excess of $3.65 million . The land lease also includes an exclusive option to purchase the leased land during the period from February 26, 2019 through October 1, 2027, for $15.5 million plus a seller-retained interest in Silver Slipper Casino and Hotel’s operations of 3% of net income (as defined) for ten years following the purchase date. In the event that we sell or transfer (i) substantially all of the assets of Silver Slipper Casino Venture, LLC, or (ii) our membership interests in Silver Slipper Casino Venture, LLC in its entirety, the purchase price will increase to $17.1 million plus the retained interest mentioned above for ten years. Bronco Billy’s Lease through January 2035 and Option to Purchase. Bronco Billy’s leases certain parking lots and buildings, including a portion of the hotel and casino, under a long-term lease. The lease term includes six renewal options in three -year increments to 2035. Bronco Billy’s exercised its first renewal option through January 2020, which increased the monthly rents from $18,500 to $25,000 for the first two years of the renewal period and $30,000 for the third year. The lease also contains a $7.6 million purchase option exercisable at any time during the lease and a right of first refusal. Grand Lodge Casino Lease through August 2023. Our subsidiary, Gaming Entertainment (Nevada), LLC, has a lease with Hyatt Equities, L.L.C. (“Hyatt”) to operate the Grand Lodge Casino. The lease is collateralized by the Company’s interests under the lease and property as defined in the lease and is subordinate to the liens of the Notes. Hyatt has an option, beginning January 1, 2019, to purchase our leasehold interest and related operating assets of the Grand Lodge Casino subject to assumption of applicable liabilities. The option price is an amount equal to the Grand Lodge Casino’s positive working capital, plus Grand Lodge Casino’s earnings before interest, income taxes, depreciation and amortization (“EBITDA”) for the twelve -month period preceding the acquisition (or pro-rated if less than twelve months remain on the lease), plus the fair market value of the Grand Lodge Casino’s personal property. On January 1, 2018, the monthly rent payment increased from $145,833 to $166,667 . Corporate Office Lease. In June 2017, the Company began occupying 4,479 square feet of office space in Las Vegas, Nevada. The office lease terms include an expiration date in January 2025 and approximately $0.2 million of annual rents. |
EARNINGS (LOSS) PER SHARE AND S
EARNINGS (LOSS) PER SHARE AND STOCKHOLDERS' EQUITY | 6 Months Ended |
Jun. 30, 2018 | |
Earnings Per Share [Abstract] | |
EARNINGS (LOSS) PER SHARE AND STOCKHOLDERS' EQUITY | EARNINGS (LOSS) PER SHARE AND STOCKHOLDERS ’ EQUITY The table below reconciles basic and diluted loss per share of common stock: (In thousands, unaudited) Three Months Ended June 30, 2018 Six Months Ended June 30, 2018 2018 2017 2018 2017 Numerator: Net loss - basic $ (661 ) $ (1,524 ) $ (4,947 ) $ (2,127 ) Adjustment for assumed conversion of warrants 81 — (423 ) — Net loss - diluted $ (580 ) $ (1,524 ) $ (5,370 ) $ (2,127 ) Denominator: Weighted-average common share equivalents - basic 26,922 22,876 25,077 22,871 Potential dilution from assumed conversion of warrants — — 499 — Weighted-average common and common share equivalents - diluted 26,922 22,876 25,576 22,871 Anti-dilutive share-based awards and warrants excluded from the calculation of diluted loss per share 3,540 3,545 2,533 3,545 In March 2018, we completed a registered direct offering for a total of 3,943,333 shares of our common stock at a price of $3.00 per share, resulting in net proceeds to us of approximately $11.4 million . We intend to use the net proceeds from this offering for general corporate purposes, including Phase One of our planned expansion of Bronco Billy’s Casino and Hotel in Cripple Creek, Colorado. |
SHARE-BASED COMPENSATION
SHARE-BASED COMPENSATION | 6 Months Ended |
Jun. 30, 2018 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
SHARE-BASED COMPENSATION | SHARE-BASED COMPENSATION As of June 30, 2018 , we had 961,225 share-based awards authorized by shareholders and available for grant from the 2015 Equity Incentive Plan. The following table summarizes information related to our common stock options as of June 30, 2018 : Number of Stock Options Weighted Average Exercise Price Options outstanding at January 1, 2018 2,491,274 $ 1.59 Granted 42,000 3.35 Exercised — — Canceled/Forfeited (16,666 ) 2.01 Options outstanding at June 30, 2018 2,516,608 $ 1.61 Options exercisable at June 30, 2018 1,849,212 $ 1.46 Share-based compensation expense totaled $175,000 and $176,000 for the three months ended June 30, 2018 and 2017 , respectively, and $407,000 and $269,000 for the six months ended June 30, 2018 and 2017 , respectively. As of June 30, 2018 , there was approximately $0.4 million of unrecognized compensation cost related to unvested stock options previously granted that is expected to be recognized over a weighted-average period of one year. As compensation for their annual service, the Company issued in May 2018 to certain non-executive members of its Board of Directors a total of 17,910 restricted shares under the 2015 Plan with a one -year transfer restriction. |
SEGMENT REPORTING
SEGMENT REPORTING | 6 Months Ended |
Jun. 30, 2018 | |
Segment Reporting [Abstract] | |
SEGMENT REPORTING | SEGMENT REPORTING We manage our casinos based on geographic regions within the United States. The casino/resort operations include four segments: Silver Slipper Casino and Hotel (Hancock County, Mississippi); Rising Star Casino Resort (Rising Sun, Indiana); Bronco Billy’s Casino and Hotel (Cripple Creek, Colorado); and the Northern Nevada segment, consisting of Grand Lodge Casino (Incline Village, Nevada) and Stockman’s Casino (Fallon, Nevada). The Company utilizes Adjusted Property EBITDA as the measure of segment profit in assessing performance and allocating resources at the reportable segment level. Adjusted Property EBITDA is defined as earnings before interest and other non-operating income (expense), taxes, depreciation and amortization, pre-opening expenses, impairment charges, asset write-offs, recoveries, gain (loss) from asset disposals, project development and acquisition costs, non-cash share-based compensation expense, and corporate-related costs and expenses that are not allocated to each property. The following tables present the Company’s segment information: (In thousands, unaudited) Three Months Ended Six Months Ended 2018 2017 2018 2017 Net Revenues Silver Slipper Casino and Hotel $ 17,492 $ 16,437 $ 34,001 $ 33,095 Rising Star Casino Resort 12,528 12,595 23,755 24,800 Bronco Billy’s Casino and Hotel 6,795 6,773 13,037 12,635 Northern Nevada Casinos 4,412 4,316 8,365 9,211 $ 41,227 $ 40,121 $ 79,158 $ 79,741 Adjusted Property EBITDA Silver Slipper Casino and Hotel $ 3,183 $ 2,907 $ 6,066 $ 5,959 Rising Star Casino Resort 776 637 1,269 1,956 Bronco Billy’s Casino and Hotel 1,256 1,477 1,961 2,323 Northern Nevada Casinos 473 (53 ) 460 499 5,688 4,968 9,756 10,737 Other operating costs and expenses: Depreciation and amortization (2,038 ) (2,138 ) (4,206 ) (4,235 ) Corporate expenses (1,273 ) (1,280 ) (2,351 ) (2,454 ) Project development and acquisition costs (130 ) (53 ) (167 ) (185 ) (Loss) gain on disposals (69 ) 14 (79 ) 1 Share-based compensation (175 ) (176 ) (407 ) (269 ) Operating income 2,003 1,335 2,546 3,595 Other (expense) income: Interest expense (2,466 ) (2,705 ) (5,006 ) (5,384 ) Loss on extinguishment of debt — — (2,673 ) — Adjustment to fair value of warrants (80 ) 30 423 30 (2,546 ) (2,675 ) (7,256 ) (5,354 ) Loss before income taxes (543 ) (1,340 ) (4,710 ) (1,759 ) Provision for income taxes 118 184 237 368 Net loss $ (661 ) $ (1,524 ) $ (4,947 ) $ (2,127 ) (In thousands) June 30, December 31, (Unaudited) Total Assets Silver Slipper Casino and Hotel $ 79,729 $ 80,780 Rising Star Casino Resort 37,672 36,327 Bronco Billy’s Casino and Hotel 38,241 35,567 Northern Nevada Casinos 11,707 12,235 Corporate and Other 14,006 8,576 $ 181,355 $ 173,485 |
BASIS OF PRESENTATION AND SIG20
BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES (Policies) | 6 Months Ended |
Jun. 30, 2018 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation. As permitted by the rules and regulations of the Securities and Exchange Commission, certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles in the United States of America (“GAAP”) have been condensed or omitted. These consolidated financial statements should be read in conjunction with the Company’s 2017 annual consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2017 . The interim consolidated financial statements of the Company included herein reflect all adjustments (consisting of normal recurring adjustments) that are, in the opinion of management, necessary to present fairly the financial position and results of operations for the interim periods presented. The results of operations for the interim periods are not necessarily indicative of annualized results for an entire year. The consolidated financial statements include the accounts of Full House and its wholly-owned subsidiaries. All intercompany accounts and transactions have been eliminated in consolidation. |
Fair Value and the Fair Value Input Hierarchy | Fair Value and the Fair Value Input Hierarchy. Fair value measurements affect our accounting for net assets acquired in acquisition transactions and certain financial assets and liabilities, such as our interest rate cap (“Interest Rate Cap”) agreement and common stock warrant liability. Fair value measurements are also used in our periodic assessments of long-lived tangible and intangible assets for possible impairment, including for property and equipment, goodwill, and other intangible assets. Fair value is defined as the expected price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. GAAP categorizes the inputs used for fair value into a three-level hierarchy: • Level 1: Observable inputs, such as quoted prices in active markets for identical assets or liabilities; • Level 2: Comparable inputs other than quoted prices that are observable for similar assets or liabilities in less active markets; and • Level 3: Unobservable inputs which may include metrics that market participants would use to estimate values, such as revenue and earnings multiples and relative rates of return. The Company utilizes Level 2 inputs when measuring the fair value of its Interest Rate Cap. In order to estimate the fair value of this derivative instrument, the Company obtains valuation reports from the third-party broker that issued the Interest Rate Cap. The report contemplates fair value by using inputs including market-observable data such as interest rate curves, volatilities, and information derived from or corroborated by that market-observable data (see Note 6). The Company utilizes Level 3 inputs when measuring the fair value of net assets acquired in business combination transactions, subsequent assessments for impairment, and most financial instruments, including but not limited to the estimated fair value of common stock warrants at issuance and for recurring changes in the related warrant liability (see Note 7). |
Operating Revenues and Related Costs and Expenses | Operating Revenues and Related Costs and Expenses. The Company adopted a new revenue standard (see Note 3) effective January 1, 2018. The Company’s revenues consist primarily of casino gaming, food and beverage, hotel, and other revenues (such as entertainment). The majority of our revenues are derived from casino gaming, principally slot machines. Gaming revenue is the difference between gaming wins and losses, not the total amount wagered. We account for our gaming transactions on a portfolio basis as such wagers have similar characteristics and it would not be practical to view each wager on an individual basis. We sometimes provide discretionary complimentary goods and services (“Discretionary Comps”). For these types of transactions, we allocate revenue to the department providing the complimentary goods or services based upon its estimated standalone selling price, offset by a reduction in casino revenues. Some of our customers choose to earn points under our customer loyalty programs. As points are accrued, we defer a portion of our gaming revenue based on the estimated standalone value of loyalty points being earned by the customer. The standalone value of loyalty points is derived from the retail value of food, beverages, hotel rooms, and other goods or services for which such points may be redeemed. A liability related to these customer loyalty points is recorded, net of estimated breakage and other factors, until the customer redeems these points, primarily for “free casino play/cash back,” complimentary dining, or hotel stays. Upon redemption, the related revenue is recognized at retail value within the department providing the goods or services. Revenue for food and beverage, hotel, and other revenue transactions is typically the net amount collected from the customer for such goods and services, plus the retail value of (i) discretionary comps and (ii) comps provided in return for redemption of loyalty points. We record such revenue as the good or service is transferred to the customer. Additionally, we may collect deposits in advance for future hotel reservations or entertainment, among other services, which represent obligations to the Company until the service is provided to the customer. Other notable changes of the new revenue recognition standard include: • The Company no longer presents a promotional allowances line item on its consolidated statement of operations, as revenues are now allocated between casino revenue and other revenue categories. • The Company no longer reclassifies the estimated cost of complimentaries provided to a gaming customer from other expense categories to casino operating expenses. |
Income Taxes | Income Taxes. For interim income tax reporting, it was determined that the Company’s annual effective tax rate could not be reasonably estimated. As a result, the Company used the actual year-to-date effective tax rate to determine the tax expense incurred during the three and six months ended June 30, 2018 and 2017 . |
Reclassifications | Reclassifications. We made certain minor reclassifications to prior-period amounts to conform to the current-period presentation. Such reclassifications had no effect on the previously reported net loss or stockholders’ equity. |
Earnings (Loss) Per Share | Earnings (Loss) Per Share. Earnings (loss) per share is net income (loss) applicable to common stock divided by the weighted average number of common shares outstanding during the period. Diluted earnings per share reflects additional dilutive effects for all potentially-dilutive securities, including common stock options and warrants, using the treasury stock method. |
New Accounting Pronouncements Implemented and to be Implemented | New Accounting Pronouncements Implemented Statement of Cash Flows. In January 2018, the Company adopted Accounting Standards Update (“ASU”) No. 2016-15, “Statement of Cash Flows: Classification of Certain Cash Receipts and Cash Payments,” otherwise referred as “ASU 2016-15.” ASU 2016-15 amends the guidance of Accounting Standards Codification (“ASC”) Topic 230 on the classification of certain cash receipts and payments in the statement of cash flows. The primary purpose of ASU 2016-15 is to reduce the diversity in practice that has resulted from the lack of consistent principles, specifically clarifying the guidance on eight cash flow issues. The adoption did not and is not expected to have a material impact on our consolidated financial statements. Revenue from Contracts with Customers. In January 2018, the Company adopted ASC 606, Revenue from Contracts with Customers (“ASC 606”) using the modified retrospective method, which applies to all contracts that are written, oral or implied by customary business practices. The comparative information as of and for the three and six months ended June 30, 2017 has not been restated and continues to be reported under the accounting standards in effect for that period. The adoption of ASC 606 for 2018 has not and is not expected to have an aggregate material impact on operating income, net income, or cash flows on an ongoing basis. New Accounting Pronouncements to be Implemented Leases. In February 2016, the FASB issued ASU No. 2016-02, “Leases (Topic 842),” (“ASU 2016-02”), which replaces the existing guidance in ASC 840, Leases. ASU 2016-02 is effective for fiscal years, and interim periods within those years, beginning after December 15, 2018. ASU 2016-02 requires a dual approach for lessee accounting under which a lessee would account for leases as finance leases or operating leases. Both finance leases and operating leases will result in the lessee recognizing a right-of-use asset and a corresponding lease liability. The Company is currently assessing the impact that adoption of this guidance will have on its consolidated financial statements and footnote disclosures. Management believes that there are no other recently-issued accounting standards not yet effective that are currently likely to have a material impact on our financial statements. |
ORGANIZATION (Tables)
ORGANIZATION (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Schedule of Properties | The following table identifies the properties along with their respective dates of acquisition and locations: Property Acquisition Location Silver Slipper Casino and Hotel 2012 Hancock County, MS Bronco Billy’s Casino and Hotel 2016 Cripple Creek, CO Rising Star Casino Resort 2011 Rising Sun, IN Stockman’s Casino 2007 Fallon, NV Grand Lodge Casino (leased and part of the Hyatt Regency Lake Tahoe Resort, Spa and Casino) 2011 Incline Village, NV |
NEW ACCOUNTING PRONOUNCEMENTS (
NEW ACCOUNTING PRONOUNCEMENTS (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Accounting Changes and Error Corrections [Abstract] | |
Schedule of New Accounting Pronouncements and Changes in Accounting Principles | The impact of adoption on our consolidated statement of operations is shown below. Note that we did not present any balance sheet effects, as the amounts are immaterial. (In thousands, unaudited) Three Months Ended June 30, 2018 Statement of Operations As Reported Balances without Adoption of ASC 606 Effect of Change Higher/(Lower) Revenues Casino $ 28,632 $ 36,713 $ (8,081 ) Food and beverage 8,783 8,704 79 Hotel 2,582 2,376 206 Promotional allowances — (7,733 ) 7,733 Costs and expenses Casino 11,282 18,675 (7,393 ) Food and beverage 9,757 3,124 6,633 Hotel 2,652 389 2,263 Other operations 834 505 329 Selling, general and administrative 12,462 14,352 (1,890 ) Operating income 2,003 2,008 (5 ) Loss before income taxes (543 ) (538 ) (5 ) Net loss (661 ) (656 ) (5 ) (In thousands, unaudited) Six Months Ended June 30, 2018 Statement of Operations As Reported Balances without Adoption of ASC 606 Effect of Change Higher/(Lower) Revenues Casino $ 55,602 $ 71,226 $ (15,624 ) Food and beverage 16,722 16,584 138 Hotel 4,865 4,459 406 Promotional allowances — (14,653 ) 14,653 Costs and expenses Casino 22,366 36,945 (14,579 ) Food and beverage 18,883 6,190 12,693 Hotel 5,139 618 4,521 Other operations 1,348 827 521 Selling, general and administrative 24,424 27,982 (3,558 ) Operating income 2,546 2,571 (25 ) Loss before income taxes (4,710 ) (4,685 ) (25 ) Net loss (4,947 ) (4,922 ) (25 ) |
REVENUE (Tables)
REVENUE (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Revenue from Contract with Customer [Abstract] | |
Schedule of Disaggregation of Revenue | Our revenue, disaggregated by type of revenue and segment, is as follows: (In thousands, unaudited) Three Months Ended June 30, 2018 Silver Slipper Casino and Hotel Rising Star Casino Resort Bronco Billy’s Casino and Hotel Northern Nevada Casinos Total Revenues Casino $ 11,438 $ 7,974 $ 5,373 $ 3,847 $ 28,632 Food and beverage 4,824 2,291 1,182 486 8,783 Hotel 835 1,586 161 — 2,582 Other operations 395 677 79 79 1,230 $ 17,492 $ 12,528 $ 6,795 $ 4,412 $ 41,227 (In thousands, unaudited) Six Months Ended June 30, 2018 Silver Slipper Casino and Hotel Rising Star Casino Resort Bronco Billy’s Casino and Hotel Northern Nevada Casinos Total Revenues Casino $ 22,488 $ 15,499 $ 10,347 $ 7,268 $ 55,602 Food and beverage 9,169 4,348 2,258 947 16,722 Hotel 1,612 2,974 279 — 4,865 Other operations 732 934 153 150 1,969 $ 34,001 $ 23,755 $ 13,037 $ 8,365 $ 79,158 |
PROPERTY AND EQUIPMENT (Tables)
PROPERTY AND EQUIPMENT (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Property, Plant and Equipment [Abstract] | |
Schedule of Property and Equipment | Property and equipment, including capital lease assets, consists of the following: (In thousands) June 30, December 31, (Unaudited) Land and improvements $ 15,927 $ 15,376 Buildings and improvements 108,874 106,728 Furniture and equipment 42,764 41,281 Construction in progress 6,225 2,723 173,790 166,108 Less: Accumulated depreciation (56,129 ) (52,050 ) $ 117,661 $ 114,058 |
LONG-TERM DEBT AND CAPITAL LE25
LONG-TERM DEBT AND CAPITAL LEASE (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Debt Disclosure [Abstract] | |
Schedule of Long-Term Debt, Related Discounts and Issuance Costs | We are required to maintain a total leverage ratio (as defined below), which measures Consolidated EBITDA (as defined in the indenture) against outstanding debt. We are allowed to deduct up to $15 million of our cash and equivalents (beyond estimated cash utilized in daily operations) in calculating the numerator of such ratio. Four Fiscal Quarters Ending Maximum Total Leverage Ratio June 30, 2018 5.50 to 1.00 September 30, 2018 5.50 to 1.00 December 31, 2018 5.25 to 1.00 March 31, 2019 5.00 to 1.00 June 30, 2019 5.00 to 1.00 September 30, 2019 4.75 to 1.00 December 31, 2019 4.75 to 1.00 March 31, 2020 4.50 to 1.00 June 30, 2020 4.50 to 1.00 September 30, 2020 4.25 to 1.00 December 31, 2020 4.25 to 1.00 March 31, 2021 4.25 to 1.00 June 30, 2021 4.25 to 1.00 September 30, 2021 and the last day of each fiscal quarter thereafter 4.00 to 1.00 Long-term debt, related discounts and issuance costs consist of the following: (In thousands) June 30, December 31, 2017 (Unaudited) Senior Secured Notes $ 99,500 $ — First Lien Term Loan — 41,063 Revolving Loan — — Second Lien Term Loan — 55,000 99,500 96,063 Less: Discounts and unamortized debt issuance costs (4,138 ) (1,497 ) 95,362 94,566 Less: Current portion of long-term debt (1,000 ) (1,000 ) $ 94,362 $ 93,566 |
Debt Instrument Redemption | On or after February 2, 2019, the Company may redeem all or a part of the Notes plus the premium as set forth below, plus accrued and applicable unpaid interest: Redemption Periods Percentage Premium On February 2, 2019 to February 1, 2020 2.0% On February 2, 2020 to February 1, 2021 1.5% On February 2, 2021 to February 1, 2022 0.5% On or after February 2, 2022 —% |
EARNINGS (LOSS) PER SHARE AND26
EARNINGS (LOSS) PER SHARE AND STOCKHOLDERS' EQUITY (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Earnings Per Share [Abstract] | |
Schedule of Earnings Per Share, Basic and Diluted | The table below reconciles basic and diluted loss per share of common stock: (In thousands, unaudited) Three Months Ended June 30, 2018 Six Months Ended June 30, 2018 2018 2017 2018 2017 Numerator: Net loss - basic $ (661 ) $ (1,524 ) $ (4,947 ) $ (2,127 ) Adjustment for assumed conversion of warrants 81 — (423 ) — Net loss - diluted $ (580 ) $ (1,524 ) $ (5,370 ) $ (2,127 ) Denominator: Weighted-average common share equivalents - basic 26,922 22,876 25,077 22,871 Potential dilution from assumed conversion of warrants — — 499 — Weighted-average common and common share equivalents - diluted 26,922 22,876 25,576 22,871 Anti-dilutive share-based awards and warrants excluded from the calculation of diluted loss per share 3,540 3,545 2,533 3,545 |
SHARE-BASED COMPENSATION (Table
SHARE-BASED COMPENSATION (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Schedule of common stock options | The following table summarizes information related to our common stock options as of June 30, 2018 : Number of Stock Options Weighted Average Exercise Price Options outstanding at January 1, 2018 2,491,274 $ 1.59 Granted 42,000 3.35 Exercised — — Canceled/Forfeited (16,666 ) 2.01 Options outstanding at June 30, 2018 2,516,608 $ 1.61 Options exercisable at June 30, 2018 1,849,212 $ 1.46 |
SEGMENT REPORTING (Tables)
SEGMENT REPORTING (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Segment Reporting [Abstract] | |
Schedule of Selected Statement of Operations Data | The following tables present the Company’s segment information: (In thousands, unaudited) Three Months Ended Six Months Ended 2018 2017 2018 2017 Net Revenues Silver Slipper Casino and Hotel $ 17,492 $ 16,437 $ 34,001 $ 33,095 Rising Star Casino Resort 12,528 12,595 23,755 24,800 Bronco Billy’s Casino and Hotel 6,795 6,773 13,037 12,635 Northern Nevada Casinos 4,412 4,316 8,365 9,211 $ 41,227 $ 40,121 $ 79,158 $ 79,741 Adjusted Property EBITDA Silver Slipper Casino and Hotel $ 3,183 $ 2,907 $ 6,066 $ 5,959 Rising Star Casino Resort 776 637 1,269 1,956 Bronco Billy’s Casino and Hotel 1,256 1,477 1,961 2,323 Northern Nevada Casinos 473 (53 ) 460 499 5,688 4,968 9,756 10,737 Other operating costs and expenses: Depreciation and amortization (2,038 ) (2,138 ) (4,206 ) (4,235 ) Corporate expenses (1,273 ) (1,280 ) (2,351 ) (2,454 ) Project development and acquisition costs (130 ) (53 ) (167 ) (185 ) (Loss) gain on disposals (69 ) 14 (79 ) 1 Share-based compensation (175 ) (176 ) (407 ) (269 ) Operating income 2,003 1,335 2,546 3,595 Other (expense) income: Interest expense (2,466 ) (2,705 ) (5,006 ) (5,384 ) Loss on extinguishment of debt — — (2,673 ) — Adjustment to fair value of warrants (80 ) 30 423 30 (2,546 ) (2,675 ) (7,256 ) (5,354 ) Loss before income taxes (543 ) (1,340 ) (4,710 ) (1,759 ) Provision for income taxes 118 184 237 368 Net loss $ (661 ) $ (1,524 ) $ (4,947 ) $ (2,127 ) (In thousands) June 30, December 31, (Unaudited) Total Assets Silver Slipper Casino and Hotel $ 79,729 $ 80,780 Rising Star Casino Resort 37,672 36,327 Bronco Billy’s Casino and Hotel 38,241 35,567 Northern Nevada Casinos 11,707 12,235 Corporate and Other 14,006 8,576 $ 181,355 $ 173,485 |
ORGANIZATION (Details)
ORGANIZATION (Details) | Jun. 30, 2018casino |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Number of casinos operated | 5 |
Number of casinos that are a part of owned real estate | 4 |
Number of casinos located within a hotel owned by a third party | 1 |
NEW ACCOUNTING PRONOUNCEMENTS30
NEW ACCOUNTING PRONOUNCEMENTS (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | ||
Revenues | |||||
Casino | [1] | $ 28,632 | $ 35,787 | $ 55,602 | $ 71,693 |
Food and beverage | [1] | 8,783 | 8,100 | 16,722 | 15,999 |
Hotel | [1] | 2,582 | 2,237 | 4,865 | 4,315 |
Promotional allowances | [1] | 0 | (7,246) | 0 | (14,283) |
Costs and expenses | |||||
Casino | [1] | 11,282 | 18,874 | 22,366 | 37,454 |
Food and beverage | [1] | 9,757 | 3,160 | 18,883 | 6,132 |
Hotel | [1] | 2,652 | 276 | 5,139 | 478 |
Other operations | [1] | 834 | 571 | 1,348 | 851 |
Selling, general and administrative | [1] | 12,462 | 13,728 | 24,424 | 26,812 |
Operating income | 2,003 | 1,335 | 2,546 | 3,595 | |
Loss before income taxes | (543) | (1,340) | (4,710) | (1,759) | |
Net loss | (661) | $ (1,524) | (4,947) | $ (2,127) | |
Balances without Adoption of ASC 606 | |||||
Revenues | |||||
Casino | 36,713 | 71,226 | |||
Food and beverage | 8,704 | 16,584 | |||
Hotel | 2,376 | 4,459 | |||
Promotional allowances | (7,733) | (14,653) | |||
Costs and expenses | |||||
Casino | 18,675 | 36,945 | |||
Food and beverage | 3,124 | 6,190 | |||
Hotel | 389 | 618 | |||
Other operations | 505 | 827 | |||
Selling, general and administrative | 14,352 | 27,982 | |||
Operating income | 2,008 | 2,571 | |||
Loss before income taxes | (538) | (4,685) | |||
Net loss | (656) | (4,922) | |||
Effect of Change Higher/(Lower) | Accounting Standards Update 2014-09 | |||||
Revenues | |||||
Casino | (8,081) | (15,624) | |||
Food and beverage | 79 | 138 | |||
Hotel | 206 | 406 | |||
Promotional allowances | 7,733 | 14,653 | |||
Costs and expenses | |||||
Casino | (7,393) | (14,579) | |||
Food and beverage | 6,633 | 12,693 | |||
Hotel | 2,263 | 4,521 | |||
Other operations | 329 | 521 | |||
Selling, general and administrative | (1,890) | (3,558) | |||
Operating income | (5) | (25) | |||
Loss before income taxes | (5) | (25) | |||
Net loss | $ (5) | $ (25) | |||
[1] | On January 1, 2018, the Company adopted Accounting Standards Codification No. 606, Revenue from Contracts with Customers (“ASC 606”), using the modified retrospective method, which impacts the comparability of these line items. |
REVENUE (Details)
REVENUE (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |
Jun. 30, 2018 | Jun. 30, 2018 | Dec. 31, 2017 | |
Disaggregation of Revenue [Line Items] | |||
Revenues | $ 41,227 | $ 79,158 | |
Liabilities with customer | 3,200 | 3,200 | $ 3,200 |
Silver Slipper Casino and Hotel | |||
Disaggregation of Revenue [Line Items] | |||
Revenues | 17,492 | 34,001 | |
Rising Star Casino Resort | |||
Disaggregation of Revenue [Line Items] | |||
Revenues | 12,528 | 23,755 | |
Bronco Billy’s Casino and Hotel | |||
Disaggregation of Revenue [Line Items] | |||
Revenues | 6,795 | 13,037 | |
Northern Nevada Casinos | |||
Disaggregation of Revenue [Line Items] | |||
Revenues | 4,412 | 8,365 | |
Casino | |||
Disaggregation of Revenue [Line Items] | |||
Revenues | 28,632 | 55,602 | |
Casino | Silver Slipper Casino and Hotel | |||
Disaggregation of Revenue [Line Items] | |||
Revenues | 11,438 | 22,488 | |
Casino | Rising Star Casino Resort | |||
Disaggregation of Revenue [Line Items] | |||
Revenues | 7,974 | 15,499 | |
Casino | Bronco Billy’s Casino and Hotel | |||
Disaggregation of Revenue [Line Items] | |||
Revenues | 5,373 | 10,347 | |
Casino | Northern Nevada Casinos | |||
Disaggregation of Revenue [Line Items] | |||
Revenues | 3,847 | 7,268 | |
Food and beverage | |||
Disaggregation of Revenue [Line Items] | |||
Revenues | 8,783 | 16,722 | |
Food and beverage | Silver Slipper Casino and Hotel | |||
Disaggregation of Revenue [Line Items] | |||
Revenues | 4,824 | 9,169 | |
Food and beverage | Rising Star Casino Resort | |||
Disaggregation of Revenue [Line Items] | |||
Revenues | 2,291 | 4,348 | |
Food and beverage | Bronco Billy’s Casino and Hotel | |||
Disaggregation of Revenue [Line Items] | |||
Revenues | 1,182 | 2,258 | |
Food and beverage | Northern Nevada Casinos | |||
Disaggregation of Revenue [Line Items] | |||
Revenues | 486 | 947 | |
Hotel | |||
Disaggregation of Revenue [Line Items] | |||
Revenues | 2,582 | 4,865 | |
Hotel | Silver Slipper Casino and Hotel | |||
Disaggregation of Revenue [Line Items] | |||
Revenues | 835 | 1,612 | |
Hotel | Rising Star Casino Resort | |||
Disaggregation of Revenue [Line Items] | |||
Revenues | 1,586 | 2,974 | |
Hotel | Bronco Billy’s Casino and Hotel | |||
Disaggregation of Revenue [Line Items] | |||
Revenues | 161 | 279 | |
Hotel | Northern Nevada Casinos | |||
Disaggregation of Revenue [Line Items] | |||
Revenues | 0 | 0 | |
Other operations | |||
Disaggregation of Revenue [Line Items] | |||
Revenues | 1,230 | 1,969 | |
Other operations | Silver Slipper Casino and Hotel | |||
Disaggregation of Revenue [Line Items] | |||
Revenues | 395 | 732 | |
Other operations | Rising Star Casino Resort | |||
Disaggregation of Revenue [Line Items] | |||
Revenues | 677 | 934 | |
Other operations | Bronco Billy’s Casino and Hotel | |||
Disaggregation of Revenue [Line Items] | |||
Revenues | 79 | 153 | |
Other operations | Northern Nevada Casinos | |||
Disaggregation of Revenue [Line Items] | |||
Revenues | $ 79 | $ 150 |
PROPERTY AND EQUIPMENT (Details
PROPERTY AND EQUIPMENT (Details) - USD ($) $ in Thousands | Jun. 30, 2018 | Dec. 31, 2017 |
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | $ 173,790 | $ 166,108 |
Less: Accumulated depreciation | (56,129) | (52,050) |
Property and equipment, net of accumulated depreciation and amortization | 117,661 | 114,058 |
Land and improvements | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 15,927 | 15,376 |
Buildings and improvements | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 108,874 | 106,728 |
Furniture and equipment | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 42,764 | 41,281 |
Construction in progress | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | $ 6,225 | $ 2,723 |
LONG-TERM DEBT AND CAPITAL LE33
LONG-TERM DEBT AND CAPITAL LEASE - Long-Term Debt (Details) - USD ($) $ in Thousands | Jun. 30, 2018 | Feb. 02, 2018 | Dec. 31, 2017 |
Debt Instrument [Line Items] | |||
Outstanding principal | $ 99,500 | $ 96,063 | |
Discounts and unamortized debt issuance costs and debt issuance costs | (4,138) | (1,497) | |
Long-term debt, net | 95,362 | 94,566 | |
Current portion of long-term debt | (1,000) | (1,000) | |
Long-term debt, net of current portion | 94,362 | 93,566 | |
Line of Credit | First Lien Credit Facility | Term Loan | |||
Debt Instrument [Line Items] | |||
Outstanding principal | 0 | $ 41,000 | 41,063 |
Line of Credit | First Lien Credit Facility | Revolving Loan | |||
Debt Instrument [Line Items] | |||
Outstanding principal | 0 | 0 | |
Line of Credit | Second Lien Term Loan | Term Loan | |||
Debt Instrument [Line Items] | |||
Outstanding principal | 0 | $ 55,000 | 55,000 |
Senior Secured Notes Due 2024 | Senior Secured Notes | |||
Debt Instrument [Line Items] | |||
Outstanding principal | $ 99,500 | $ 0 |
LONG-TERM DEBT AND CAPITAL LE34
LONG-TERM DEBT AND CAPITAL LEASE - Senior Secured Notes Narrative (Details) - USD ($) | Feb. 02, 2018 | Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | Dec. 31, 2017 |
Line of Credit Facility [Line Items] | ||||||
Outstanding principal | $ 99,500,000 | $ 99,500,000 | $ 96,063,000 | |||
Loss on extinguishment of debt | 0 | $ 0 | 2,673,000 | $ 0 | ||
Line of Credit | Term Loan | ||||||
Line of Credit Facility [Line Items] | ||||||
Loss on extinguishment of debt | $ 2,700,000 | |||||
Line of Credit | First Lien Credit Facility | Term Loan | ||||||
Line of Credit Facility [Line Items] | ||||||
Outstanding principal | 41,000,000 | 0 | 0 | 41,063,000 | ||
Line of Credit | Second Lien Term Loan | Term Loan | ||||||
Line of Credit Facility [Line Items] | ||||||
Outstanding principal | 55,000,000 | 0 | 0 | 55,000,000 | ||
Senior Secured Notes Due 2024 | Senior Secured Notes | ||||||
Line of Credit Facility [Line Items] | ||||||
Face amount of senior secured notes | $ 100,000,000 | |||||
Issue price, percentage | 98.00% | |||||
Discount percentage | 2.00% | |||||
Outstanding principal | $ 99,500,000 | $ 99,500,000 | $ 0 | |||
Periodic payment of principal | $ 250,000 | |||||
Balloon payment to be paid | $ 94,000,000 | |||||
Redemption price, percentage | 100.00% | |||||
Senior Secured Notes Due 2024 | Senior Secured Notes | LIBOR | ||||||
Line of Credit Facility [Line Items] | ||||||
Variable rate floor | 1.00% | |||||
Applicable margin rate | 7.00% |
LONG-TERM DEBT AND CAPITAL LE35
LONG-TERM DEBT AND CAPITAL LEASE - Redemption of Senior Secured Notes (Details) - Senior Secured Notes - Senior Secured Notes Due 2024 | 6 Months Ended |
Jun. 30, 2018 | |
On February 2, 2019 to February 1, 2020 | |
Line of Credit Facility [Line Items] | |
Percentage Premium | 2.00% |
On February 2, 2020 to February 1, 2021 | |
Line of Credit Facility [Line Items] | |
Percentage Premium | 1.50% |
On February 2, 2021 to February 1, 2022 | |
Line of Credit Facility [Line Items] | |
Percentage Premium | 0.50% |
On or after February 2, 2022 | |
Line of Credit Facility [Line Items] | |
Percentage Premium | 0.00% |
LONG-TERM DEBT AND CAPITAL LE36
LONG-TERM DEBT AND CAPITAL LEASE - Interest Rate Cap Agreement Narrative (Details) - USD ($) | 1 Months Ended | 6 Months Ended | |
Apr. 30, 2018 | Jun. 30, 2018 | Jun. 30, 2017 | |
Derivatives, Fair Value [Line Items] | |||
Payment for interest rate cap | $ 238,000 | $ 238,000 | $ 0 |
Notional amount | $ 50,000,000 | ||
Cap interest rate | 3.00% | ||
Derivative term | 3 months | ||
Deposits And Other | |||
Derivatives, Fair Value [Line Items] | |||
Fair value of interest rate cap | $ 236,877 |
LONG-TERM DEBT AND CAPITAL LE37
LONG-TERM DEBT AND CAPITAL LEASE - Covenants (Details) - Senior Secured Notes Due 2024 - Senior Secured Notes | Jun. 30, 2018USD ($) |
Line of Credit Facility [Line Items] | |
Cash and cash equivalents, allowed to deduct from adjusted EBITDA to debt ratio | $ 15,000,000 |
June 30, 2018 | |
Line of Credit Facility [Line Items] | |
Maximum Total Leverage Ratio | 5.50 |
September 30, 2018 | |
Line of Credit Facility [Line Items] | |
Maximum Total Leverage Ratio | 5.50 |
December 31, 2018 | |
Line of Credit Facility [Line Items] | |
Maximum Total Leverage Ratio | 5.25 |
March 31, 2019 | |
Line of Credit Facility [Line Items] | |
Maximum Total Leverage Ratio | 5 |
June 30, 2019 | |
Line of Credit Facility [Line Items] | |
Maximum Total Leverage Ratio | 5 |
September 30, 2019 | |
Line of Credit Facility [Line Items] | |
Maximum Total Leverage Ratio | 4.75 |
December 31, 2019 | |
Line of Credit Facility [Line Items] | |
Maximum Total Leverage Ratio | 4.75 |
March 31, 2020 | |
Line of Credit Facility [Line Items] | |
Maximum Total Leverage Ratio | 4.50 |
June 30, 2020 | |
Line of Credit Facility [Line Items] | |
Maximum Total Leverage Ratio | 4.50 |
September 30, 2020 | |
Line of Credit Facility [Line Items] | |
Maximum Total Leverage Ratio | 4.25 |
December 31, 2020 | |
Line of Credit Facility [Line Items] | |
Maximum Total Leverage Ratio | 4.25 |
March 31, 2021 | |
Line of Credit Facility [Line Items] | |
Maximum Total Leverage Ratio | 4.25 |
June 30, 2021 | |
Line of Credit Facility [Line Items] | |
Maximum Total Leverage Ratio | 4.25 |
September 30, 2021 and the last day of each fiscal quarter thereafter | |
Line of Credit Facility [Line Items] | |
Maximum Total Leverage Ratio | 4 |
LONG-TERM DEBT AND CAPITAL LE38
LONG-TERM DEBT AND CAPITAL LEASE - Capital Lease (Details) - Rising Star Casino Resort - Rising Sun/Ohio County First, Inc | 6 Months Ended |
Jun. 30, 2018USD ($)room | |
Capital Leased Assets [Line Items] | |
Number of hotel rooms | room | 104 |
Project actual cost | $ 7,700,000 |
Lease purchase option | 5,100,000 |
Option price at lease maturity | $ 1 |
COMMON STOCK WARRANT LIABILITY
COMMON STOCK WARRANT LIABILITY (Details) - USD ($) $ / shares in Units, $ in Millions | May 13, 2016 | Jun. 30, 2018 | Dec. 31, 2017 |
Class of Warrant or Right [Line Items] | |||
Common stock warrant liability | $ 2.1 | $ 2.5 | |
Line of Credit | Second Lien Term Loan | Warrant to Purchase Common Equity | |||
Class of Warrant or Right [Line Items] | |||
Warrants issued (in shares) | 1,006,568 | ||
Warrant exercise price (in dollars per share) | $ 1.67 | ||
Period for mandatory registration rights to maintain ownership interest | 2 years | ||
Period for measuring repurchase value | 21 days | ||
Expected contractual term | 7 years 10 months 13 days | ||
Expected stock price volatility rate | 43.00% | ||
Expected dividend yield | 0.00% | ||
Expected risk-free interest rate | 2.82% | ||
Unsecured Debt | Second Lien Term Loan | Warrant to Purchase Common Equity | |||
Class of Warrant or Right [Line Items] | |||
Term of unsecured note | 4 years | ||
Minimum | Unsecured Debt | Second Lien Term Loan | Warrant to Purchase Common Equity | |||
Class of Warrant or Right [Line Items] | |||
Interest rate on unsecured note | 13.25% |
INCOME TAXES (Details)
INCOME TAXES (Details) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
Income Tax Disclosure [Abstract] | ||||
Effective income tax rate | (21.90%) | (13.70%) | (5.00%) | (20.90%) |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Details) | Jun. 20, 2018USD ($) | Jan. 01, 2018USD ($) | Nov. 30, 2017USD ($) | Jun. 30, 2017USD ($)square_feet | Jun. 30, 2018USD ($)option | Dec. 31, 2017USD ($) | Dec. 31, 2004USD ($)a |
Various Buildings And Land In Cripple Creak, Colorado | |||||||
Commitments and Contingencies [Line Items] | |||||||
Capitalized costs | $ 200,000 | ||||||
Silver Slipper Casino | Land lease | |||||||
Commitments and Contingencies [Line Items] | |||||||
Purchase price of leased land and buildings | $ 15,500,000 | ||||||
Lease includes base payments | $ 77,500 | ||||||
Percentage of gross gaming revenue | 3.00% | ||||||
Gross gaming revenue (in excess of) | $ 3,650,000 | ||||||
Retained interest in percentages of net income | 3.00% | ||||||
Retained interest in percentages of net income, term | 10 years | ||||||
New purchase price if change in ownership of Silver Slipper | $ 17,100,000 | ||||||
Silver Slipper Casino | Land lease | Marshland | |||||||
Commitments and Contingencies [Line Items] | |||||||
Area of land subject to ground lease | a | 31 | ||||||
Silver Slipper Casino | Land lease | Parcel | |||||||
Commitments and Contingencies [Line Items] | |||||||
Area of land subject to ground lease | a | 7 | ||||||
Grand Lodge Casino facility | |||||||
Commitments and Contingencies [Line Items] | |||||||
Lease includes base payments | $ 166,667 | $ 145,833 | |||||
EBITDA measurement period | 12 months | ||||||
Corporate Office Lease | |||||||
Commitments and Contingencies [Line Items] | |||||||
Lease includes base payments | $ 200,000 | ||||||
Office lease, square feet | square_feet | 4,479 | ||||||
Land, Buildings and Improvements | Various Buildings And Land In Cripple Creak, Colorado | |||||||
Commitments and Contingencies [Line Items] | |||||||
Purchase price of leased land and buildings | 2,500,000 | ||||||
Annual increase to purchase price option | 100,000 | ||||||
Maximum purchase price on purchase option | 2,800,000 | ||||||
Option to purchase land with a hotel | 1,700,000 | ||||||
Option to purchase land with a residence | $ 300,000 | ||||||
Land, Buildings and Improvements | Various Buildings And Land In Cripple Creak, Colorado | Lease Terms, Option One | |||||||
Commitments and Contingencies [Line Items] | |||||||
Term of contract if exercised | 3 years | ||||||
Annual lease payments | $ 200,000 | ||||||
Land, Buildings and Improvements | Various Buildings And Land In Cripple Creak, Colorado | Lease Terms, Option Two | |||||||
Commitments and Contingencies [Line Items] | |||||||
Annual lease payments | $ 300,000 | ||||||
Lease extension term | 2 years | ||||||
Parking Lot | |||||||
Commitments and Contingencies [Line Items] | |||||||
Land purchase options exercised | $ 1,200,000 | ||||||
Certain parking lots and buildings | Bronco Billy's Casino and Hotel | |||||||
Commitments and Contingencies [Line Items] | |||||||
Purchase price of leased land and buildings | $ 7,600,000 | ||||||
Lease includes base payments | $ 18,500 | ||||||
Number of renewal options | option | 6 | ||||||
Lease extension term | 3 years | ||||||
Certain parking lots and buildings | Bronco Billy's Casino and Hotel | Lease Terms, Option One | |||||||
Commitments and Contingencies [Line Items] | |||||||
Lease includes base payments | $ 25,000 | ||||||
Certain parking lots and buildings | Bronco Billy's Casino and Hotel | Lease Terms, Option Two | |||||||
Commitments and Contingencies [Line Items] | |||||||
Lease includes base payments | $ 30,000 |
EARNINGS (LOSS) PER SHARE AND42
EARNINGS (LOSS) PER SHARE AND STOCKHOLDERS' EQUITY - Reconciliation of Earnings Per Share (Details) - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
Numerator: | ||||
Net loss - basic | $ (661) | $ (1,524) | $ (4,947) | $ (2,127) |
Adjustment for assumed conversion of warrants | 81 | 0 | (423) | 0 |
Net loss - diluted | $ (580) | $ (1,524) | $ (5,370) | $ (2,127) |
Denominator: | ||||
Weighted-average common share equivalents - basic (in shares) | 26,922 | 22,876 | 25,077 | 22,871 |
Potential dilution from assumed conversion of warrants (in shares) | 0 | 0 | 499 | 0 |
Weighted-average common and common share equivalents - diluted (in shares) | 26,922 | 22,876 | 25,576 | 22,871 |
Anti-dilutive share-based awards and warrants excluded from the calculation of diluted loss per share (in shares) | 3,540 | 3,545 | 2,533 | 3,545 |
EARNINGS (LOSS) PER SHARE AND43
EARNINGS (LOSS) PER SHARE AND STOCKHOLDERS' EQUITY - Narrative (Details) - USD ($) $ / shares in Units, $ in Thousands | 1 Months Ended | 6 Months Ended |
Mar. 31, 2018 | Jun. 30, 2018 | |
Earnings Per Share [Abstract] | ||
Equity offering (in shares) | 3,943,333 | |
Shares issued, price per share (in dollars per share) | $ 3 | |
Registered direct offering | $ 11,400 | $ 11,436 |
SHARE-BASED COMPENSATION - Narr
SHARE-BASED COMPENSATION - Narrative (Details) - USD ($) $ in Thousands | 1 Months Ended | 3 Months Ended | 6 Months Ended | ||
May 31, 2018 | Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Share-based compensation expense | $ 175 | $ 176 | $ 407 | $ 269 | |
Stock options | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Unrecognized compensation cost | $ 400 | $ 400 | |||
Weighted-average period of unrecognized compensation cost expected to be recognized | 1 year | ||||
2015 Equity Incentive Plan | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Shares available for grant (in shares) | 961,225 | 961,225 | |||
2015 Equity Incentive Plan | Non-executive Members of the Board of Directors | Restricted Shares | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Restricted shares issued to non-executive members of the Board of Directors (in shares) | 17,910 | ||||
Transfer restriction period | 1 year |
SHARE-BASED COMPENSATION - Summ
SHARE-BASED COMPENSATION - Summarizes information related to our common stock options (Details) - Stock options | 6 Months Ended |
Jun. 30, 2018$ / sharesshares | |
Number of Stock Options | |
Options outstanding, beginning balance (in shares) | shares | 2,491,274 |
Granted (in shares) | shares | 42,000 |
Exercised (in shares) | shares | 0 |
Canceled/Forfeited (in shares) | shares | (16,666) |
Options outstanding, ending balance (in shares) | shares | 2,516,608 |
Options exercisable (in shares) | shares | 1,849,212 |
Weighted Average Exercise Price | |
Weighted average exercise price, Options outstanding (in dollars per share) | $ / shares | $ 1.59 |
Granted (in dollars per share) | $ / shares | 3.35 |
Exercised (in dollars per share) | $ / shares | 0 |
Canceled/Forfeited (in dollars per share) | $ / shares | 2.01 |
Weighted average exercise price, Options outstanding (in dollars per share) | $ / shares | 1.61 |
Weighted average exercise price, Options exercisable (in dollars per share) | $ / shares | $ 1.46 |
SEGMENT REPORTING - Selected St
SEGMENT REPORTING - Selected Statement of Operations Data (Details) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2018USD ($) | Jun. 30, 2017USD ($) | Jun. 30, 2018USD ($)segment | Jun. 30, 2017USD ($) | |
Segment Reporting [Abstract] | ||||
Number of segments | segment | 4 | |||
Segment Reporting Information [Line Items] | ||||
Net Revenues | $ 41,227 | $ 40,121 | $ 79,158 | $ 79,741 |
Adjusted Property EBITDA | 5,688 | 4,968 | 9,756 | 10,737 |
Other operating costs and expenses: | ||||
Depreciation and amortization | (2,038) | (2,138) | (4,206) | (4,235) |
Corporate expenses | (1,273) | (1,280) | (2,351) | (2,454) |
Project development and acquisition costs | (130) | (53) | (167) | (185) |
Gain (Loss) on Disposition of Assets | (69) | 14 | (79) | 1 |
Share-based compensation | (175) | (176) | (407) | (269) |
Operating income | 2,003 | 1,335 | 2,546 | 3,595 |
Other (expense) income: | ||||
Interest expense | (2,466) | (2,705) | (5,006) | (5,384) |
Loss on extinguishment of debt | 0 | 0 | (2,673) | 0 |
Adjustment to fair value of warrants | (80) | 30 | 423 | 30 |
Total other (expense) income | (2,546) | (2,675) | (7,256) | (5,354) |
Loss before income taxes | (543) | (1,340) | (4,710) | (1,759) |
Provision for income taxes | 118 | 184 | 237 | 368 |
Net loss | (661) | (1,524) | (4,947) | (2,127) |
Silver Slipper Casino and Hotel | ||||
Segment Reporting Information [Line Items] | ||||
Net Revenues | 17,492 | 16,437 | 34,001 | 33,095 |
Adjusted Property EBITDA | 3,183 | 2,907 | 6,066 | 5,959 |
Rising Star Casino Resort | ||||
Segment Reporting Information [Line Items] | ||||
Net Revenues | 12,528 | 12,595 | 23,755 | 24,800 |
Adjusted Property EBITDA | 776 | 637 | 1,269 | 1,956 |
Bronco Billy’s Casino and Hotel | ||||
Segment Reporting Information [Line Items] | ||||
Net Revenues | 6,795 | 6,773 | 13,037 | 12,635 |
Adjusted Property EBITDA | 1,256 | 1,477 | 1,961 | 2,323 |
Northern Nevada Casinos | ||||
Segment Reporting Information [Line Items] | ||||
Net Revenues | 4,412 | 4,316 | 8,365 | 9,211 |
Adjusted Property EBITDA | $ 473 | $ (53) | $ 460 | $ 499 |
SEGMENT REPORTING - Selected Ba
SEGMENT REPORTING - Selected Balance Sheet Data (Details) - USD ($) $ in Thousands | Jun. 30, 2018 | Dec. 31, 2017 |
Segment Reporting Information [Line Items] | ||
Total Assets | $ 181,355 | $ 173,485 |
Operating Segments | Silver Slipper Casino and Hotel | ||
Segment Reporting Information [Line Items] | ||
Total Assets | 79,729 | 80,780 |
Operating Segments | Rising Star Casino Resort | ||
Segment Reporting Information [Line Items] | ||
Total Assets | 37,672 | 36,327 |
Operating Segments | Bronco Billy’s Casino and Hotel | ||
Segment Reporting Information [Line Items] | ||
Total Assets | 38,241 | 35,567 |
Operating Segments | Northern Nevada Casinos | ||
Segment Reporting Information [Line Items] | ||
Total Assets | 11,707 | 12,235 |
Corporate and Other | ||
Segment Reporting Information [Line Items] | ||
Total Assets | $ 14,006 | $ 8,576 |