Market Overview

Dover Downs Gaming & Entertainment, Inc. Reports Results for the Second Quarter Ended June 30, 2018

Share:

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

The Company's revenues for the second quarter of 2018 increased 2.3% to
$44,133,000 compared with $43,141,000 for the second quarter of 2017.
Gaming revenues were $33,895,000 compared to $33,227,000 for the second
quarter of last year.

Occupancy levels in the Dover Downs Hotel were approximately 85% for the
second quarter of both years.

General and administrative, depreciation and interest expenses were each
fairly consistent with the second quarter of 2017.

Net earnings were $153,000 compared with $33,000 for the second quarter
of 2017. Earnings per diluted share were $.00 for the second quarter of
each year.

Denis McGlynn, the Company's President and Chief Executive Officer,
stated: "I want to take this opportunity to thank the Legislature and
the Administration for listening to the needs of the casino industry in
Delaware. The modification to the gaming tax structure will help us
going forward as we continue to improve our performance in this
intensely competitive market."

As previously announced, the Company has entered into a definitive
merger agreement with Twin River Worldwide Holdings, Inc. The merger
contemplates that Dover Downs stockholders will exchange their Dover
Downs stock for Twin River common shares representing 7.225% of the
equity in the combined company at closing. Please see the press release
of July 22, 2018 and the Form 8-K filed on July 23, 2018 for more
information.

This release contains or may contain forward-looking statements based on
management's beliefs and assumptions. Such statements are subject to
various risks and uncertainties that could cause results to vary
materially. Please refer to the Company's SEC filings for a discussion
of such factors.

Owned by Dover Downs Gaming & Entertainment, Inc. (NYSE:DDE), Dover
Downs Hotel & Casino® is a premier gaming and entertainment resort
destination in the Mid-Atlantic region. Gaming operations consist of
approximately 2,200 slots, a full complement of table games, including
poker, and a newly expanded race and sports book taking single game
wagers on professional and college sports. The AAA-rated Four Diamond
hotel is Delaware's largest with 500 luxurious rooms/suites and
amenities including a full-service spa/salon, concert hall and 41,500
sq. ft. of multi-use event space. Live, world-class harness racing is
featured November through April, and horse racing is simulcast
year-round. Additional property amenities include multiple restaurants
from fine dining to casual fare, bars/lounges and retail shops. For more
information, please visit www.doverdowns.com.

 
DOVER DOWNS GAMING & ENTERTAINMENT, INC.
CONSOLIDATED STATEMENTS OF EARNINGS (LOSS)
In Thousands, Except Per Share Amounts
(Unaudited)
         
 
Three Months Ended
June 30,
Six Months Ended
June 30,
2018 2017 * 2018 2017 *
Revenues:
Gaming $ 33,895 $ 33,227 $ 68,029 $ 68,533
Other operating   10,238     9,914     19,263     18,620  
  44,133     43,141     87,292     87,153  
Expenses:
Gaming 32,730 32,115 65,565 65,981
Other operating 7,655 7,425 14,689 14,262
General and administrative 1,342 1,333 2,727 2,708
Depreciation   2,050     2,086     4,190     4,032  
  43,777     42,959     87,171     86,983  
 
Operating earnings 356 182 121 170
 
Interest expense (199 ) (208 ) (408 ) (417 )
Other income   84     44     167     88  
 
Earnings (loss) before income taxes 241 18 (120 ) (159 )
 
Income tax (expense) benefit   (88 )   15     -     (4 )
 
Net earnings (loss) $ 153   $ 33   $ (120 ) $ (163 )
 
Net earnings (loss) per common share:
- Basic $ -   $ -   $ -   $ (0.01 )
- Diluted $ -   $ -   $ -   $ (0.01 )
 
Weighted average shares outstanding:
- Basic 32,447 32,322 32,445 32,321
- Diluted 32,447 32,322 32,445 32,321
 
_________________________
*  

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

 

 
DOVER DOWNS GAMING & ENTERTAINMENT, INC.
CONSOLIDATED BALANCE SHEETS
In Thousands
(Unaudited)
   
 
June 30,
2018
December 31,
2017 *
ASSETS
 
Current assets:
Cash $ 10,837 $ 10,714
Accounts receivable 3,013 3,557
Due from State of Delaware 4,794 5,720
Inventories 1,932 1,928
Prepaid expenses and other 2,847 2,840
Receivable from Dover Motorsports, Inc. 19 7
Income taxes receivable   317     318  
Total current assets 23,759 25,084
 
Property and equipment, net 131,835 134,527
Other assets 370 564
Deferred income taxes   1,765     1,786  
Total assets $ 157,729   $ 161,961  
 
LIABILITIES AND STOCKHOLDERS' EQUITY
 
Current liabilities:
Accounts payable $ 1,949 $ 2,571
Purses due horsemen 4,799 5,814
Accrued liabilities 7,499 8,111
Deferred credits 122 49
Contract liabilities 3,971 3,724
Revolving line of credit   18,000     19,900  
Total current liabilities 36,340 40,169
 
Liability for pension benefits   7,080     7,483  
Total liabilities   43,420     47,652  
 
Stockholders' equity:
Common stock 1,841 1,827
Class A common stock 1,487 1,487
Additional paid-in capital 5,924 5,877
Retained earnings 109,731 109,817
Accumulated other comprehensive loss   (4,674 )   (4,699 )
Total stockholders' equity   114,309     114,309  
Total liabilities and stockholders' equity $ 157,729   $ 161,961  
 
_________________________
*  

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

 

 
DOVER DOWNS GAMING & ENTERTAINMENT, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
In Thousands
(Unaudited)
   
 
Six Months Ended
June 30,
2018 2017 *
 
Operating activities:
Net loss $ (120 ) $ (163 )

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

Depreciation 4,190 4,032
Amortization of credit facility origination fees 20 26
Stock-based compensation 135 186
Deferred income taxes (2 ) (171 )
Losses on equity investments 2 -
Changes in assets and liabilities:
Accounts receivable 544 1,113
Due from State of Delaware 926 3,458
Inventories (4 ) (277 )
Prepaid expenses and other (12 ) (389 )
Receivable from Dover Motorsports, Inc. (12 ) (26 )
Income taxes receivable 1 124
Accounts payable (547 ) (687 )
Purses due horsemen (1,015 ) (3,782 )
Accrued liabilities (612 ) (1,534 )
Deferred credits 73 131
Contract liabilities 247 449
Liability for pension benefits   (321 )   (199 )
Net cash provided by operating activities   3,493     2,291  
 
Investing activities:
Capital expenditures (1,393 ) (1,196 )
Purchase of equity investments (21 ) (40 )
Proceeds from sale of equity investments   18     38  
Net cash used in investing activities   (1,396 )   (1,198 )
 
Financing activities:
Borrowings from revolving line of credit 29,830 46,720
Repayments of revolving line of credit (31,730 ) (48,970 )
Repurchase of common stock   (74 )   (74 )
Net cash used in financing activities   (1,974 )   (2,324 )
 
Net increase (decrease) in cash 123 (1,231 )
Cash, beginning of period   10,714     11,677  
Cash, end of period $ 10,837   $ 10,446  
 
_________________________
*  

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

 

View Comments and Join the Discussion!