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MTR Gaming Group, Inc. (MNTG)
Q4 2013 Earnings Conference Call
March 11, 2014 04:30 pm ET
Garrett Edson - Investor Relations
Joe Billhimer - President, Chief Operating Officer
John Bittner - Chief Financial Officer, Executive Vice President
James Kayler - Bank of America Merrill Lynch
Dennis Farrell - Wells Fargo Securities
Joe Hudak - Wells Fargo Advisors
Previous Statements by MNTG
» MTR Gaming Management CEO Discusses Q3 2013 Results - Earnings Call Transcript
» MTR Gaming Group Management Discusses Q2 2013 Results - Earnings Call Transcript
» MTR Gaming Group's CEO Discusses Q1 2013 Results - Earnings Call Transcript
» MTR Gaming Group Management Discusses Q4 2012 Results - Earnings Call Transcript
I would now like to turn the conference over to Garrett Edson of ICR. Please go ahead, sir.
Thank you, Danielle. Good afternoon, everyone. Welcome to the MTR Gaming Group fourth quarter 2013 conference call.
Before we get started, I just want to remind you that company's remarks may include forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 as amended, and Section 21E of the Securities Exchange Act of 1934 as amended concerning the company’s prospects. Actual results could differ materially from those projected or suggested in any forward-looking statements as a result of a variety of factors, which are described in the company’s periodic reports filed with the Securities and Exchange Commission and in the company’s news releases.
Additionally, the company may discuss EBITDA, or earnings before interest, taxes, depreciation and amortization, which is a non-GAAP financial measure. Such information and any disclosure required by the SEC Regulation G can be found in MTR's March 11, 2014 earnings release, which is reproduced on the company’s website under Investor Relations. Finally, under certain circumstances, the Federal Securities laws may require the company to file a transcript of this call, including your questions, with the SEC. Accordingly if you ask a question, the company will assume that you have consented it to the inclusion of your question and identity in any such required filing.
It is now my pleasure to introduce your host, Joe Billhimer, President and COO of MTR Gaming. Mr. Billhimer?
Good afternoon, everyone, and thank you for your interest in MTR Gaming. Joining me on the call today is our CFO, John Bittner. I'll make some brief comments on the fourth quarter performance and the current status of the merger with Eldorado Resorts, and then turn it over to John to cover some financial highlights.
Overall, when you consider the inclement weather in December, as well as the continuing weak consumer environment, the competitive market in Columbus and an extremely active promotional market in Northeast Ohio, we are pleased with our fourth quarter performance.
Our Scioto Downs facility in particular performed extremely well seeing both, double-digit revenue and adjusted EBITDA growth in the quarter as well as [slot] market share gains despite the aforementioned headwinds. This is a testament to the entire Scioto Downs' management team and the facility we built.
For the fourth quarter of 2013, we recorded adjusted EBITDA of $21 million on net revenue of $114.8 million compared to adjusted EBITDA of $21.2 million and net revenues of $115.8 million in the fourth quarter of 2012. Adjusted EBITDA for the quarter excludes strategic initiative related cost of $1.6 million.
Besides our solid Scioto Downs' performance, Mountaineer Park also performed well in the quarter seeing double digit adjusted EBITDA growth driven principally by operating efficiencies. Our property improvements continued in the quarter and specifically our Mountaineer hotel room renovations are ongoing and we expect the new rooms to be well received by our patrons.
Results at our Presque Isle Downs facility were impacted by the severe weather conditions and continued to be affected by the active promotional market in Northeast, Ohio, and we continue to focus on our marketing programs and operating efficiencies to offset some of this impact while focusing on our margins. The construction of the new Wyndham branded Baymont Hotel that we will manage is expected to open in April.
While our fourth quarter performance was solid, the extreme weather in the first quarter has affected everyone in the market and we are not immune. Operations have started to normalize as the weather begins to improve, but weather will have a significant impact on our first quarter results as well. As a side note, we have installed the new General Manager at our Presque Isle Downs facility.
Finally, with regard to our merger with Eldorado Resorts, we announced in January an early termination of the HSR waiting periods satisfying one of the conditions to the merger. We have also received initial approval from the State of Pennsylvania, regarding the transfer of interest as well as the consent from our noteholders and a waiver for our credit facility regarding the change control relating to the merger.
The merger is still on track to close in mid-2014, and remain subject to certain conditions and approvals, including subsequent regulatory approvals from various regulators in Louisiana, Nevada, Ohio, Pennsylvania and West Virginia, and approval by stockholders of MTR Gaming, along with registration and listing of the new company stock and customary closing conditions.
With that, I will turn it over to John.
Thanks, Joe. Rather than reiterate what's already in the press release, I'll just make a few comments and then we will open it up for questions just because I understand that there may be folks press for time.