HOUSTON, May 17, 2021 /PRNewswire/ -- Golden Nugget Online
Gaming, Inc. (Nasdaq: GNOG) (the "Company") today reported its
financial results for the first quarter ended March 31, 2021.
First Quarter Highlights
- Revenue was $26.7 million,
representing an increase of 54.2%, compared to $17.3 million during the first quarter of
2020.
- Net income was $69.6 million
after gains on warrant derivatives liabilities of $81.1 million, a gain on the tax receivable
agreement liability of $1.3 million
and debt extinguishment expenses of $2.2
million.
- Adjusted EBITDA was $(3.5)
million compared to Adjusted EBITDA of $5.9 million for the first quarter of 2020.
- The previous full-year revenue outlook range of $130 million to $145
million is maintained for 2021.
Revenues for the three months ended March
31, 2021, totaled $26.7
million, as compared to $17.3
million for the three months ended March 31, 2020. Net income was $69.6 million, compared to net income of
$4.2 million in the prior year
comparable period. Adjusted EBITDA, as defined below, for the
three months ended March 31, 2021 was
$(3.5) million compared to
$5.9 million last year. Results
for the first quarter of 2021 reflect non-cash gains on warrant
derivative liabilities of $81.1
million and a non-cash gain on our tax receivable agreement
liability of $1.3 million. All
of our 10,541,667 public warrants were exercised or redeemed during
the quarter. Additionally, first quarter results also reflect
interest expense associated with the term loan credit agreement
entered into on April 28, 2020.
The Company's results also reflect debt extinguishment costs
of $2.2 million including the
accelerated amortization of deferred loan costs and debt premium
totaling $0.6 million associated with
the early repayment of $10.6 million
of the term loan during the three months ended March 31, 2021. Stock-based compensation
expenses were $2.3 million for the
three months ended March 31, 2021,
when no such costs were recognized in the prior year.
President, Thomas Winter remarked
"We are very pleased to start 2021 with such strong results across
both our established and new expansion markets. We believe we are
well positioned to capitalize on the significant and fast growing
market for iGaming across North
America. We expect that 2021 will be a milestone year for
the Company as we are on target to be live in 6 states by the end
of the year, including all 4 key iGaming states."
Chairman and Chief Executive Officer, Tilman Fertitta added "The future is very bright
for Golden Nugget Online Gaming as we achieved another record
quarter in revenue and with our newly announced partnerships in
Colorado and Iowa, we now have market access in 12 states,
representing approximately 29% of the US population."
Business Update
- Successfully completed our first quarter of operations in
Michigan.
- Secured market access in Colorado with Maverick's Z Casino for
online sports and casino, subject to legislation and regulatory
approvals.
- Secured market access in Iowa
with the Wild Rose Casino for online sports and casino, subject to
legislation and regulatory approvals.
- Completed exercise and redemption of all public warrants
for cash proceeds of $110.2
million.
- Started the 1,800 square feet expansion of our live dealer
studio in New Jersey
- Named to the shortlist of nominees in 5 categories for the EGR
North America Awards 2021: "Casino Operator", "Mobile Operator",
"Marketing Campaign", "Customer Service Operator" and "Operator of
the Year".
Conference Call Details
A conference call for investors will be held Monday, May 17, 2021, at 3:30 p.m. Central Time to discuss the Company's
first quarter results.
To access the conference call, please dial (855) 908-6093 (U.S.)
or (639) 716-2098 (International) and reference conference ID
3395274. The conference call will also be webcast live through the
Company's Investor Relations website at
https://www.gnoginc.com.
About GNOG
Golden Nugget Online Gaming, Inc. is a leading online gaming
company that is considered a market leader by its peers and was
first to bring Live Dealer and Live Casino Floor to the United States online gaming market. GNOG
was the recipient of 15 eGaming Review North America Awards,
including the coveted "Operator of the Year" award in 2017, 2018,
2019 and 2020.
Forward-Looking Statements
This press release contains forward-looking statements within
the meaning of Section 27A of the Securities Act of 1933, as
amended, or the Securities Act, and Section 21E of the Securities
Exchange Act of 1934, as amended, or the Exchange Act, about us and
our industry that involve substantial risks and uncertainties. All
statements other than statements of historical facts contained in
this press release, including guidance, our expected results of
operations or financial condition, business strategy and plans,
user growth and engagement, product initiatives, and objectives of
management for future operations, and the impact of COVID-19 on our
business and the economy as a whole, are forward-looking
statements. In some cases, you can identify forward-looking
statements because they contain words such as "anticipate,"
"believe," "contemplate," "continue," "could," "estimate,"
"expect," "expectations," "forecast," "going to,"
"intend," "may," "plan," "potential," "predict," "project,"
"propose," "should," "target," "will," or "would" or the
negative of these words or other similar terms or expressions. We
caution you that the foregoing may not include all of the
forward-looking statements made in this press release.
The financial results included in this press release are
preliminary, estimated and unaudited. The preliminary financial
results included in this press release reflect management's
estimates based solely upon information available to management as
of the date of this press release and are subject to change upon
the completion of GNOG's financial closing procedures, final
adjustments and other developments, including review by GNOG's
independent registered public accounting firm, that may arise
between now and the time the financial results for the first
quarter are finalized. During the course of that process, GNOG may
identify items that would require it to make adjustments, which may
be material, to the information in this press release. As a result,
the preliminary unaudited financial information included in this
press release is forward-looking information and is subject to
risks and uncertainties, including possible material adjustments to
the preliminary financial information and the other risks and
uncertainties described below under "Forward-Looking Statements."
Accordingly, you should not place undue reliance on these
estimates.
You should not rely on forward-looking statements as predictions
of future events. We have based the forward-looking statements
contained in this press release primarily on our current
expectations and projections about future events and trends,
including the ongoing COVID-19 pandemic that we believe may affect
our business, financial condition, results of operations, and
prospects. These forward-looking statements are not guarantees of
future performance, conditions or results, and involve a number of
known and unknown risks, uncertainties, assumptions and other
important factors, many of which are outside GNOG's control, that
could cause actual results or outcomes to differ materially from
those discussed in the forward-looking statements. Important
factors, among others, that may affect actual results
or outcomes include the inability to recognize the anticipated
benefits of GNOG's acquisition transaction; costs related to
the acquisition transaction; the inability to maintain the
listing of GNOG's shares on Nasdaq; GNOG's ability to manage
growth; GNOG's ability to execute its business plan and meet
its projections; potential litigation involving GNOG;
changes in applicable laws or regulations, particularly with
respect to gaming; general economic and market conditions
impacting demand for GNOG's products and services, and in
particular economic and market conditions in the media /
entertainment / gaming / software industry in the markets in
which GNOG's operates; the potential adverse effects of the
ongoing global coronavirus (COVID-19) pandemic on capital
markets, general economic conditions, unemployment and GNOG's
liquidity, operations and personnel, as well as risks,
uncertainties, and other factors described in the section
entitled "Risk Factors" in GNOG's filings with the SEC, which
are available on the SEC's website at www.sec.gov. Additional
information will be made available in other filings that we make
from time to time with the SEC. In addition, any forward-looking
statements contained in this press release are based on assumptions
that we believe to be reasonable as of this date. We undertake no
obligation to update any forward-looking statements to reflect
events or circumstances after the date of this press release or to
reflect new information or the occurrence of unanticipated events,
including future developments related to the COVID-19 pandemic,
except as required by law.
Golden Nugget
Online Gaming, Inc.
|
Unaudited
|
Consolidated
Statement of Operations
|
(In thousands,
except per share amounts)
|
|
|
Three Months
Ended
|
|
March
31,
|
|
2021
|
|
2020
|
|
|
|
|
Revenues
|
|
|
|
Gaming
|
$
23,066
|
|
$
14,905
|
Other
|
3,683
|
|
2,438
|
Total
revenue
|
26,749
|
|
17,343
|
Costs and
expenses
|
|
|
|
Cost of
revenue
|
12,116
|
|
6,745
|
Advertising and
promotion
|
14,371
|
|
2,977
|
General and
administrative
|
6,077
|
|
1,696
|
Depreciation and amortization
|
44
|
|
34
|
Total costs and
expenses
|
32,608
|
|
11,452
|
Operating income
(loss)
|
(5,859)
|
|
5,891
|
Other expense
(income)
|
|
|
|
Interest expense,
net
|
5,708
|
|
1
|
Gain on warrant
derivatives
|
(81,091)
|
|
-
|
Other
expense
|
366
|
|
-
|
Total other (income)
expense
|
(75,017)
|
|
1
|
Income before income
taxes
|
69,158
|
|
5,890
|
Provision for income
taxes
|
(478)
|
|
1,703
|
Net income
|
69,636
|
|
4,187
|
Net loss attributable
to non-controlling interests
|
5,707
|
|
-
|
Net income
attributable to GNOG
|
$
75,343
|
|
$
4,187
|
|
|
|
|
Earnings (loss) per
share:
|
|
|
|
Basic
|
$
1.83
|
|
n/a
|
Diluted
|
$
(0.15)
|
|
n/a
|
Weighted-average
number of common shares outstanding:
|
|
|
|
Basic
|
41,162
|
|
n/a
|
Diluted
|
77,053
|
|
n/a
|
Non-GAAP Financial Measures
EBITDA and adjusted EBITDA are supplemental non-GAAP financial
measures that are used by management and external users of our
financial statements, such as industry analysts, investors, lenders
and rating agencies. We define "EBITDA" as earnings (or loss)
before interest, taxes, depreciation, and amortization, and we
define "Adjusted EBITDA" as EBITDA before stock-based compensation,
acquisition transaction related expenses, debt extinguishment
expenses and other non-recurring items. Neither EBITDA nor Adjusted
EBITDA is a measure of net income as determined by U.S. generally
accepted accounting principles ("GAAP").
Management believes EBITDA and Adjusted EBITDA are useful
because they allow management to more effectively evaluate our
operating performance and compare the results of our operations
from period to period and against our peers without regard to our
financing methods or capital structure or non-recurring, non-cash
transactions. We exclude the items listed above in calculating
EBITDA and Adjusted EBITDA because these amounts can vary
substantially from company to company depending upon capital
structures and the method by which assets were acquired. None of
EBITDA or Adjusted EBITDA should be considered an alternative to,
or more meaningful than, net income (loss), the most closely
comparable financial measure calculated in accordance with GAAP.
Certain items excluded from EBITDA and Adjusted EBITDA are
significant components in understanding and assessing a company's
financial performance, such as a company's return on assets, cost
of capital and tax structure. Our presentation EBITDA and Adjusted
EBITDA should not be construed as an inference that our results
will be unaffected by unusual or non-recurring items. Our
computations of EBITDA and Adjusted EBITDA may not be comparable to
other similarly titled measures of other companies.
Reconciliation of
net income to EBITDA and adjusted EBITDA (In
thousands):
|
|
|
Three Months
Ended
|
|
March
31,
|
|
2021
|
|
2020
|
|
|
|
|
Net income
|
$
69,636
|
|
$
4,187
|
Adjusted
for:
|
|
|
|
Provision for income taxes
|
(478)
|
|
1,703
|
Interest
expense, net
|
5,708
|
|
1
|
Depreciation and amortization
|
44
|
|
34
|
EBITDA
|
$
74,910
|
|
$
5,925
|
Adjusted
for:
|
|
|
|
Debt
extinguishment expenses
|
1,622
|
|
-
|
Gain on
tax receivable agreement liability
|
(1,256)
|
|
-
|
Gain on
warrant derivatives
|
(81,091)
|
|
-
|
Stock-based compensation
|
2,290
|
|
-
|
Adjusted
EBITDA
|
$
(3,525)
|
|
$
5,925
|
Adjusted EBITDA is
comprised of the following (In thousands):
|
|
|
Three Months
Ended
|
|
March
31,
|
|
2021
|
|
2020
|
|
|
|
|
State-level adjusted
EBITDA
|
$
(1,393)
|
|
$
6,201
|
Corporate adjusted
EBITDA
|
(2,132)
|
|
(276)
|
Total adjusted
EBITDA
|
$
(3,525)
|
|
$
5,925
|
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SOURCE Golden Nugget Online Gaming, Inc.