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Bally's Corporation Announces Fourth Quarter And Full Year 2020 Results

03/04/2021
COMPANY ESTABLISHES FOUNDATION OF ITS INTERACTIVE DIVISION

PROVIDENCE, R.I., March 4, 2021 /PRNewswire/ -- Bally's Corporation (NYSE: BALY) (the "Company" or "Bally's"), today reported financial results for the fourth quarter and full year ended December 31, 2020.

Fourth Quarter 2020 and Recent Highlights

  • Net income increased 51.4% year-over-year to $20.2 million, driven primarily by bargain purchase gains, as well as margin improvements and increased operational efficiencies
  • Adjusted EBITDA decreased 47.6% to $21.1 million year-over-year, impacted by COVID-19 related regional capacity and health limitations
  • Despite the difficulties in the quarter, the Company generated cash from operating activities of $17.8 million in the fourth quarter of 2020 compared to $21.4 million for the same period 2019
  • Quarter benefited from current year acquisitions, including Casino KC which recorded the strongest operating fourth quarter in recent history as a result of targeted marketing strategies
  • Continued execution on growth and diversification strategy, highlighted by Bet.Works, Monkey Knife Fight and SportCaller acquisitions and strategic media partnership with Sinclair Broadcast Group
  • Closed acquisitions of Bally's Atlantic City Hotel & Casino and Eldorado Resort Casino Shreveport

George Papanier, President and Chief Executive Officer, said, "2020 was a truly remarkable year for Bally's. Amid the ongoing impact of the COVID-19 pandemic, we continued to systematically execute our strategic growth and development initiatives. Though fourth quarter results were impacted by various regional capacity and health limitations, most notably in Rhode Island, we expect to benefit from a strong rebound in demand across our properties, as well as the operational efficiencies and strong margin improvements that we have seen as a continuing trend since re-opening from the pandemic. In fact, market indications and preliminary results show markedly stronger consumer demand in January and February."

Papanier continued, "Without question, the highlights of the fourth quarter were our pending acquisition of Bet.Works, which will drive development of our interactive offerings, as well as our strategic media partnership with Sinclair Broadcast Group, which we expect will make Bally's a common name in sports fans' households across the U.S. Additionally, we are pleased to have closed on our previously announced acquisitions of Bally's Atlantic City Hotel & Casino and the Eldorado Resort Casino Shreveport, which represent valuable additions and expanded footprint to our foundational brick-and-mortar portfolio. We also recently debuted our FanDuel Sportsbook inside Bally's Atlantic City, which represents the first of several planned capital improvement projects at the property."

Summary of Financial Results



Quarter Ended
December 31,




Year Ended
December 31,




(in thousands, except per share amounts and
percentages)

2020


2019


Change


2020


2019


Change


Revenue

$

118,096


$

130,419


(9.4)

%


$

372,792


$

523,577


(28.8)

%

(Loss) income from operations

$

(17,637)


$

29,022


(160.8)

%


$

(18,386)


$

114,626


(116.0)

%

(Loss) income from operations margin

(14.93)%



22.25%





(4.93)%




21.89%




Net income (loss)

$

20,223


$

13,355


51.4

%


$

(5,487)


$

55,130


(110.0)

%

Net income (loss) margin

17.12%



10.24%





(1.47)%



10.53%




Adjusted EBITDA(1)

$

21,059


$

40,212


(47.6)

%


$

70,402


$

167,150


(57.9)

%

Adjusted EBITDA Margin(1)

17.83%



30.83%





18.89%



31.92%




Earnings (loss) per diluted share ("EPS")

$

0.61


$

0.40


52.5

%


$

(0.18)


$

1.46


(112.3)

%

Adjusted EPS(1)

$

0.39


$

0.42


(7.1)

%


$

(0.09)


$

1.81


(105.0)

%


(1) Refer to tables in this press release for a reconciliation of these non-GAAP financial measures to the most directly comparable measure calculated in accordance with GAAP.

Fourth Quarter 2020 Results

Revenue for the fourth quarter of 2020 decreased 9.4% to $118.1 million from $130.4 million in the fourth quarter of 2019. Revenue for the fourth quarter of 2020 continued to be negatively impacted by various state limitations as a result of COVID-19, including the mandated closure of both Rhode Island properties for three weeks. The Rhode Island casinos reopened on December 22, 2020 and are currently operating 24 hours a day, seven days a week. The decrease in revenue was partially offset by incremental revenues from the recent acquisitions of Casino KC and Casino Vicksburg, which were acquired on July 1, 2020, Bally's Atlantic City, which was acquired on November 18, 2020, and Eldorado Resort Casino Shreveport, which was acquired on December 23, 2020.

Loss from operations in the fourth quarter of 2020 totaled $17.6 million, a decrease of $46.7 million, or 160.8%, year-over-year. Included within the loss was a $15.1 million charge, net of insurance recoveries, for storm damage from Hurricane Zeta at the Hard Rock Biloxi. Excluding this extraordinary charge, the operating results were most heavily impacted by the Rhode Island shutdown in the period noted above, as well as a loss from operations recognized at Bally's Atlantic City since our acquisition. Historically, Bally's Atlantic City has incurred losses during the fourth and first quarters of the calendar year and makes a majority of its profit in the summer months. The combination of this seasonality, COVID related restrictions and increased costs attributable to IT and marketing system overhead, resulted in higher than expected losses in the fourth quarter. The Company was able to convert its systems in mid-February 2021 and has commenced work on several capital improvement initiatives, including opening of the new sportsbook with its partner FanDuel, and believes the property is now on track to recovery and growth. 

At properties where the Company operated with fewer COVID restrictions, notably in the Southeast segment and at Dover Downs, the Company mitigated a portion of the impact of this revenue reduction through operational efficiencies, which had a positive impact on margins, continuing a trend noted since re-opening from the pandemic. Margin improvements were primarily driven by labor savings, reduced marketing and promotional spend, and reduced lower margin amenities.

Net income in the fourth quarter of 2020 was $20.2 million, an increase of $6.9 million, from net income of $13.4 million in the fourth quarter last year. This income was driven primarily by bargain purchase gains totaling $63.9 million, which were recorded on the Company's fourth quarter 2020 acquisitions of Bally's Atlantic City and Eldorado Resort Casino Shreveport coupled with a $50.9 million tax benefit recorded in the quarter, which included the utilization of net operating loss carrybacks under the CARES Act. These benefits were partially offset by the change in fair value of naming rights liabilities issued under the Sinclair arrangement and the net operating loss noted above.

Adjusted EBITDA for the fourth quarter of 2020 was $21.1 million, a decrease of $19.2 million, or 47.6%, from Adjusted EBITDA of $40.2 million in the fourth quarter 2019.

Diluted EPS for the fourth quarter of 2020 was $0.61 per share compared to $0.40 per share in the comparable period in 2019. Adjusted EPS was $0.39 for the fourth quarter of 2020 compared to Adjusted EPS of $0.42 in the same period in  2019.

Business Highlights

On November 9, 2020, the Company formally announced that it changed its corporate name from Twin River Worldwide Holdings, Inc. to Bally's Corporation. The name change represented part of the Company's unified branding initiative, which complements the considerable geographic growth and operational improvements the Company has achieved in 2020. It will also support the Company's drive to become the first omni-channel gaming company to seamlessly integrate and operate physical casinos with digital solutions. On the same date, the Company's common shares began trading on the New York Stock Exchange under the ticker symbol "BALY."

The Company also issued three material announcements on November 18, 2020.

First, the Company announced the closing of its acquisition of Bally's Atlantic City Hotel & Casino from Caesars Entertainment, Inc. and Vici Properties, Inc. The total cash purchase price was $25 million, subject to customary closing adjustments, funded with cash on hand. As part of the transaction, the Company also received three sports betting and five iGaming skins in New Jersey.

In addition, the Company announced that it had entered into an agreement to acquire Bet.Works, a U.S.-based, sports betting platform provider to operators in New Jersey, Iowa, Indiana and Colorado, for $125 million, subject to adjustment. Bet.Works' proprietary technology stack and turnkey solutions, which include marketing, operations, customer service, risk management and compliance will allow the Company to become the premier, full-service, vertically integrated sports betting and iGaming company in the U.S. with a B2B2C business model and physical casinos and online gaming solutions united under a single, preeminent brand. In conjunction with the acquisition, the Company announced that it will form two distinct operating divisions: "Bally's Casinos," which will be comprised of Bally's physical gaming and entertainment properties, and "Bally's Interactive," which will consist of new and existing contracts for sports betting and iGaming, including all of Bet.Works' sports betting operations. The Bet.Works transaction is expected to close during the second quarter of 2021, pending regulatory approval and other customary closing conditions.

Finally, the Company announced that it had entered into agreements for a long-term strategic media partnership with Sinclair Broadcast Group. The partnership combines Bally's vertically integrated, proprietary sports betting technology and expansive market access footprint with Sinclair's premier portfolio of local broadcast stations and live regional sports networks ("RSNs"), STIRR, its popular Tennis Channel, and digital and over-the-air television network Stadium. Under the terms of the agreement, the Company will receive extensive access to Sinclair's network of local, live sports content as the unified network brand and integrated partner across 19 RSNs, accounting for more than half of the U.S. MLB, NBA and NHL teams. Additionally, Sinclair's RSNs have since been rebranded under the Bally name, as Sinclair recently unveiled the official Bally Sports logo and corresponding regional monikers that will replace the existing FOX Sports logos.

On December 23, 2020, the Company announced the closing of its acquisition of the Eldorado Resort Casino Shreveport from Caesars Entertainment, Inc. The total purchase price was $140 million, subject to customary adjustments, and funded with cash on hand and available borrowings under the Company's revolving credit facility. Eldorado Resort Casino Shreveport is located in Shreveport, Louisiana, situated right on the banks of the Red River. This premier property includes 1,382 slots, 54 tables and 403 hotel rooms.

On January 4, 2021, the Company announced that it had signed a framework agreement with real estate developer Ira Lubert to jointly design, develop, construct and manage a Category 4 licensed casino in Centre County, Pennsylvania. The total estimated cost of the project is approximately $120 million. The Company will maintain a majority equity interest in the partnership, including 100% of the economic interests of all retail sports betting, online sports betting and iGaming activities associated with the project. Construction is expected to begin in the first half of 2021 and will take approximately one year to complete. The casino is expected to house up to 650 slot machines and 30 table games.

On January 25, 2021, the Company announced that it had entered into an agreement to acquire Monkey Knife Fight, the fastest-growing gaming platform and third-largest daily fantasy sports operator in North America. The transaction will make Bally's just the third sports betting company in the U.S. to have a fantasy sports segment, while Monkey Knife Fight will become an integral component of the "Bally's Interactive" division, as well as contribute to the Company's growing player database.

On February 8, 2021, the Company announced that it had acquired SportCaller, a leading global B2B free-to-play game provider. The acquisition of SportCaller will enable the Company to use free-to-play games as an additional player engagement and retention tool in states that authorize sports betting, and expand the Company's strong geographic presence beyond national borders, as SportCaller has more than 100 games in over 20 languages, and over 30 sports across 37 countries.

Proforma for all the pending acquisitions and the casino under development, the Company will operate 15 casino locations in 11 states.

Other Financial Information

As of December 31, 2020, the Company had $123.4 million in cash and cash equivalents, excluding restricted cash. In addition, the Company had $215.0 million of available borrowings under its credit facility. The Company has no substantial scheduled debt maturities before 2024.

Interest expense, net of interest income, for the fourth quarter of 2020 increased $8.2 million to $19.2 million compared to the fourth quarter last year. This increase was a result of debt obligations outstanding in each respective period coupled with timing and differences in interest rates.

The Company had capital expenditures of $15.3 million for the year.

Reconciliation of GAAP Measures to Non-GAAP Measures

To supplement the financial information presented on a generally accepted accounting principles ("GAAP") basis, the Company has included in this earnings release non-GAAP financial measures for Adjusted EBITDA, Adjusted EBITDA margin, gross gaming revenue, and adjusted earnings per diluted share, which exclude certain items described below. The Company believes these measures represent important measures of financial performance that provide useful information that is helpful in understanding the Company's ongoing operating results. The reconciliations of these non-GAAP financial measures to their comparable GAAP financial measures are presented in the tables appearing below.

"Adjusted EBITDA" is earnings, or loss, for the Company, or where noted the Company's reporting segments, before, in each case, interest expense, net of interest income, (benefit) provision for income taxes, depreciation and amortization, non-operating income, acquisition, integration and restructuring expense, goodwill and asset impairment, expansion and pre-opening expenses, share-based compensation, rebranding, change in fair value of naming rights liabilities, gain on bargain purchases, professional and advisory fees associated with capital return program, CARES Act credit, credit agreement amendment expenses, storm related losses, net of insurance recoveries, Bet.Works and Sinclair, sports and iGaming licensing, and certain other gains or losses as well as, when presented for the Company's reporting segments, an adjustment related to the allocation of corporate costs among segments. Adjusted EBITDA margin is measured as Adjusted EBITDA as a percentage of revenue.

"Gross gaming revenue" represents total gaming revenue adjusted for the State of Rhode Island's and the State of Delaware's respective shares of net terminal income, table games revenue and other gaming revenue, and is being presented by the Company to reflect the unique structure of the Company's operations in those states where each state's share of the Company's revenues is retained at the gross revenue level rather than through taxes. Management believes that the presentation of gaming revenue on a gross basis allows for comparisons to gross gaming win data provided throughout the gaming industry.

"Adjusted EPS" represents net income, or loss, per diluted share before acquisition, integration and restructuring expense, goodwill and asset impairment, storm related losses, net of insurance recoveries, expansion and pre-opening expenses, change in value of naming rights liabilities, gain on bargain purchases, rebranding, Bet.Works and Sinclair, sports and iGaming licensing, credit agreement amendment expenses, professional and advisory fees associated with capital return program, CARES Act credit, and certain other gains or losses.

Management has historically used Adjusted EBITDA, Adjusted EBITDA margin and Adjusted EPS when evaluating operating performance because the Company believes that the inclusion or exclusion of certain recurring and non-recurring items is necessary to provide a full understanding of the Company's core operating results and as a means to evaluate period-to-period performance. Management also believes that Adjusted EBITDA is a measure that is widely used for evaluating operating performance of companies in our industry and a principal basis for valuing resort and gaming companies like the Company. Management of the Company believes that while certain items excluded from Adjusted EBITDA and Adjusted EPS may be recurring in nature and should not be disregarded in evaluating the Company's earnings performance, it is useful to exclude such items when comparing current performance to prior periods because these items can vary significantly depending on specific underlying transactions or events that may not be comparable between the periods presented or they may not relate specifically to current operating trends or be indicative of future results. Neither Adjusted EBITDA nor Adjusted EPS should be construed as an alternative to GAAP net income or GAAP diluted EPS, respectively, as an indicator of the Company's performance. In addition, Adjusted EBITDA or Adjusted EPS as used by the Company may not be defined in the same manner as other companies in the Company's industry, and, as a result, may not be comparable to similarly titled non-GAAP financial measures of other companies.  

Fourth Quarter Conference Call

The Company's fourth quarter 2020 earnings conference call and audio webcast will be held today, Thursday, March 4, 2021 at 8:00 AM EDT. To access the conference call, please dial (833) 570-1160 (U.S. toll-free) and reference conference ID number 2192049. The webcast of the call will be available to the public, on a listen-only basis, via the Internet at the Investors section of the Company's website at www.ballys.com. An online archive of the webcast will be available on the Company's website for 120 days. Supplemental materials have also been posted to the Investors section of the website, under Events & Presentations.

About Bally's Corporation

Bally's Corporation currently owns and manages 11 casinos across seven  states, a horse racetrack, and 13 authorized OTB licenses in Colorado. With more than 5,400 employees, the Company's operations include 12,890 slot machines, 443 game tables and 2,904 hotel rooms. Following the completion of pending acquisitions, which include Tropicana Evansville (Evansville, IN), Jumer's Casino & Hotel (Rock Island, IL), and MontBleu Resort Casino & Spa (Lake Tahoe, NV), as well as the construction of a land-based casino near the Nittany Mall in State College, PA, Bally's will own and manage 15 casinos across 11 states. Its shares trade on the New York Stock Exchange under the ticker symbol "BALY."

Investor Contact


Media Contact

Steve Capp


Richard Goldman / David Gill

Executive Vice President and Chief Financial Officer


Kekst CNC

401-475-8564


646-847-6102 / 917-842-5384

InvestorRelations@twinriver.com


BallysMediaInquiries@kekstcnc.com

Cautionary Note Regarding Forward-Looking Statements

This document includes forward-looking statements within the meaning of the securities laws. Forward-looking statements are statements as to matters that are not historical facts, and include statements about Bally's plans, objectives, expectations and intentions.

Forward-looking statements are not guarantees and are subject to risks and uncertainties. Forward-looking statements are based on Bally's current expectations and assumptions. Although Bally's believes that its expectations and assumptions are reasonable at this time, they should not be regarded as representations that Bally's expectations will be achieved. Actual results may vary materially. Forward-looking statements speak only as of the time of this document and Bally's does not undertake to update or revise them as more information becomes available, except as required by law.

Important factors beyond those that apply to most businesses, some of which are beyond Bally's control, that could cause actual results to differ materially from our expectations and assumptions include, without limitation:

  • uncertainties surrounding the COVID-19 pandemic, including limitations on Bally's operations, increased costs, changes in customer attitudes, impact on Bally's employees and the ongoing impact of COVID-19 on general economic conditions;

  • unexpected costs, difficulties integrating and other events impacting Bally's recently completed and proposed acquisitions and Bally's ability to realize anticipated benefits;

  • risks associated with Bally's rapid growth, including those affecting customer and employee retention, integration and controls;

  • risks associated with the impact of the digitalization of gaming on Bally's casino operations, Bally's expansion into iGaming and sports betting and the highly competitive and rapidly changing aspects of Bally's new interactive businesses generally;

  • the very substantial regulatory restrictions applicable to Bally's, including costs of compliance;

  • restrictions and limitations in agreements governing Bally's debt could significantly affect Bally's ability to operate our business and our liquidity; and

  • other risk factors as detailed under Part I. Item 1A. "Risk Factors" of the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 2019 as filed with the Securities and Exchange Commission ("SEC") on March 13, 2020, the Company's Quarterly Report on Form 10-Q for the fiscal quarter ended March 31, 2020 as filed with the SEC on May 14, 2020, the Company's Quarterly Report on Form 10-Q for the fiscal quarter ended June 30, 2020, and the Company's Quarterly Report on Form 10-Q for the fiscal quarter ended September 30, 2020 as filed with the SEC on November 6, 2020.

The foregoing list of important factors is not exclusive and does not include matters like changes in general economic conditions that affect substantially all gaming businesses.

You should not to place undue reliance on Bally's forward-looking statements.

BALLY'S CORPORATION

CONDENSED CONSOLIDATED BALANCE SHEETS (unaudited)

(In thousands, except share data)



December 31,


2020


2019

Assets




Cash and cash equivalents

$

123,445



$

182,581


Restricted cash

3,110



2,921


Accounts receivable, net

14,798



23,190


Inventory

9,296



7,900


Tax receivable

84,483




Prepaid expenses and other assets

53,823



28,439


Total current assets

288,955



245,031


Property and equipment, net

749,029



510,436


Right of use assets, net

36,112



17,225


Goodwill

186,979



133,082


Intangible assets, net

663,395



110,373


Other assets

5,385



5,740


Total assets

$

1,929,855



$

1,021,887


Liabilities and Stockholders' Equity




Current portion of long-term debt

$

5,750



$

3,000


Current portion of lease obligations

1,520



1,014


Accounts payable

15,869



14,921


Accrued liabilities

120,055



70,849


Total current liabilities

143,194



89,784


Lease obligations, net of current portion

62,025



16,214


Long-term debt, net of current portion

1,094,105



680,601


Pension benefit obligations

9,215



8,688


Deferred tax liability

36,983



13,790


Naming rights liabilities

243,965




Other long-term liabilities

13,770



1,399


Total liabilities

1,603,257



810,476


Commitments and contingencies




Stockholders' equity:




Common stock, par value $0.01; 100,000,000 shares authorized; 30,685,938 and 41,193,018 shares issued as of December 31, 2020 and 2019, respectively; 30,685,938 and 32,113,328 shares outstanding as of December 31, 2020 and 2019, respectively

307



412


Additional paid-in-capital

294,643



185,544


Treasury Stock, at cost, 0 and 9,079,690 shares as of December 31, 2020 and 2019, respectively.



(223,075)


Retained earnings

34,792



250,418


Accumulated other comprehensive loss

(3,144)



(1,888)


Total stockholders' equity

326,598



211,411


Total liabilities and stockholders' equity

$

1,929,855



$

1,021,887


 

BALLY'S CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (unaudited)

(In thousands, except per share data)



Quarter Ended December 31,


Year Ended December 31,


2020


2019


2020


2019

Revenue:








Gaming

$

95,467



$

88,531



$

291,658



$

367,948


Racing

1,595



3,136



6,412



13,114


Hotel

8,107



10,174



24,742



38,988


Food and beverage

8,257



19,538



32,132



69,904


Other

4,670



9,040



17,848



33,623


Total revenue

118,096



130,419



372,792



523,577










Operating costs and expenses:








Gaming

30,375



23,282



89,455



93,965


Racing

1,569



2,275



6,446



9,592


Hotel

3,218



3,754



10,144



14,841


Food and beverage

7,416



16,382



29,367



58,447


Retail, entertainment and other

796



2,624



3,257



8,327


Advertising, general and administrative

59,928



44,079



176,943



180,400


Goodwill and asset impairment

105





8,659




Expansion and pre-opening

342





921




Acquisition, integration and restructuring expense

6,273



1,121



13,257



12,168


Storm related losses, net of insurance recoveries

15,131



(1,181)



14,095



(1,181)


Rebranding

792





792




Depreciation and amortization

9,788



9,061



37,842



32,392


Total operating costs and expenses

135,733



101,397



391,178



408,951


(Loss) income from operations

(17,637)



29,022



(18,386)



114,626










Other income (expense):








Interest income

315



327



612



1,904


Interest expense, net of amounts capitalized

(19,560)



(11,352)



(63,248)



(39,830)


Change in value of naming rights liabilities

(57,660)





(57,660)




Gain on bargain purchases

63,871





63,871




Loss on extinguishment and modification of debt



(212)





(1,703)


Other, net







183


Total other expense, net

(13,034)



(11,237)



(56,425)



(39,446)










(Loss) income before provision for income taxes

(30,671)



17,785



(74,811)



75,180


(Benefit) provision for income taxes

(50,894)



4,430



(69,324)



20,050


Net income (loss)

$

20,223



$

13,355



$

(5,487)



$

55,130










Net income (loss) per share, basic

$

0.62



$

0.40



$

(0.18)



$

1.46


Weighted average common shares outstanding, basic

32,774,612



33,675,830



31,315,151



37,705,179










Net income (loss) per share, diluted

$

0.61



$

0.40



$

(0.18)



$

1.46


Weighted average common shares outstanding, diluted

33,117,823



33,773,935



31,315,151



37,819,617


 


Year Ended December 31,


2020


2019

Cash flows from operating activities:




Net (loss) income

$

(5,487)



$

55,130


Adjustments to reconcile net (loss) income to net cash provided by operating activities:




Depreciation and amortization

37,842



32,392


Amortization of operating lease right of use assets

804



1,215


Share-based compensation

17,706



3,826


Amortization of deferred financing costs and discounts on debt

4,636



2,684


Loss on debt extinguishment and modification of debt



1,703


Bad debt expense

353



239


Net pension and other post-retirement benefit income



(39)


Deferred income taxes

1,191



8,995


Goodwill and asset impairment

8,659




Storm related losses

14,408




Loss on disposal of property and equipment

35



98


Accretion of trade name liability and naming rights

594




Change in value of naming rights liabilities

57,660




Gain on bargain purchase

(63,871)




Changes in operating assets and liabilities:




Accounts receivable

11,622



5,211


Inventory

125



(89)


Prepaid expenses and other assets

(76,099)



(14,172)


Accounts payable

(4,976)



(3,860)


Accrued liabilities

14,300



767


Net cash provided by operating activities

19,502



94,100


Cash flows from investing activities:




Cash paid for acquisitions, net of cash acquired

(425,063)



(9,606)


Deposit for pending acquisition of Jumer's Casino & Hotel

(4,000)




Proceeds from sale of property and equipment



10


Capital expenditures

(15,283)



(28,237)


Payments associated with licenses and market access fees

(500)



(1,092)


Net cash used in investing activities

(444,846)



(38,925)


Cash flows from financing activities:




Revolver borrowings

285,000



25,000


Revolver repayments

(250,000)



(80,000)


Term loan proceeds, net of fees of $13,820 and $10,655, respectively

261,180



289,345


Term loan repayments

(4,375)



(343,939)


Senior note proceeds, net of fees of $2,500 and $6,130, respectively

122,500



393,870


Payment of financing fees

(1,734)



(4,340)


Share repurchases

(33,292)



(223,075)


Payment of shareholder dividends

(3,204)



(7,539)


Share redemption for tax withholdings - restricted stock

(9,762)



(426)


Stock options exercised

84




Net cash provided by financing activities

366,397



48,896






Net change in cash and cash equivalents and restricted cash

(58,947)



104,071


Cash and cash equivalents and restricted cash, beginning of period

185,502



81,431


Cash and cash equivalents and restricted cash, end of period

$

126,555



$

185,502


Supplemental disclosure of cash flow information:




Cash paid for interest

$

57,234



$

35,040


Cash paid for income taxes

3,835



16,519


 

BALLY'S CORPORATION


Reconciliation of Net Income (Loss) and Net Income (Loss) Margin to

Adjusted EBITDA and Adjusted EBITDA Margin (unaudited)



Quarter Ended December 31,


Year Ended December 31,

(in thousands, except percentages)

2020


2019


2020


2019

Revenue

$

118,096



$

130,419



$

372,792



$

523,577










Net income (loss)

$

20,223



$

13,355



$

(5,487)



$

55,130


Interest expense, net of interest income

19,245



11,025



62,636



37,926


(Benefit) provision for income taxes

(50,894)



4,430



(69,324)



20,050


Depreciation and amortization

9,788



9,061



37,842



32,392


Non-operating income







(183)


Acquisition, integration and restructuring expense

6,273



1,121



13,257



12,168


Goodwill and asset impairment

105





8,659




Expansion and pre-opening expenses

342





921




Share-based compensation

8,238



1,019



17,706



3,826


Rebranding

792





792




Change in value of naming rights liabilities

57,660





57,660




Gain on bargain purchase

(63,871)





(63,871)




Professional and advisory fees associated with capital return program



10



(17)



3,510


CARES Act credit (1)

20





(3,928)




Credit Agreement amendment expenses (2)

87



764



810



2,915


Storm related losses, net of insurance recoveries (3)

15,131



(1,181)



14,095



(1,333)


Bet.Works and Sinclair(4)

1,248





1,248




Sports and iGaming Licensing(5)

226





226




Other (6)

(3,554)



608



(2,823)



749


Adjusted EBITDA

$

21,059



$

40,212



$

70,402



$

167,150










Net (loss) income margin

17.12

%


10.24

%


(1.47)

%


10.53

%

Adjusted EBITDA margin

17.83

%


30.83

%


18.89

%


31.92

%


__________________________________

(1)

Amount represents the Employee Retention Credit under the CARES Act which provides the Company with a refundable tax credit of 50% of up to $10,000 in wages paid by an eligible employer whose business has been financially impacted by COVID-19.

(2)

Credit Agreement amendment expenses include costs associated with amendments made to the Company's Credit Agreement.

(3)

Represents losses incurred from damage resulting from Hurricane Zeta at Hard Rock Biloxi in the fourth quarter of 2020 offset by insurance recovery proceeds received for a damaged roof at the Company's Arapahoe Park racetrack and insurance recoveries associated with damage from Hurricane Nate at Hard Rock Biloxi for the respective periods.

(4)

Expenses incurred to establish the partnership with Sinclair Broadcast Group and acquisition costs attributable to the Bet.Works acquisition in the fourth quarter of 2020.

(5)

Represents costs incurred to apply for and obtain sports and iGaming licenses in various jurisdictions.

(6)

Other includes the following non-recurring items for the applicable periods (i) expenses incurred associated with the Rhode Island State Police investigation into a former tenant in the Lincoln property and a former employee of the Company, (ii) a pension audit payment representing an adjustment to a charge for out-of-period unpaid contributions, inclusive of estimated interest and penalties, to one of the Company's multi-employer pension plans, (iii) expenses incurred associated with the campaign attempting to create an open bid process for the Rhode Island Lottery Contract, (iv) non-routine legal expenses incurred in connection with certain litigation matters (net of insurance reimbursements), and (v) costs incurred in connection with the implementation of a new human resources information system.

 

B ALLY'S CORPORATION

Revenue and Reconciliation of Net Income (Loss) to

Adjusted EBITDA by Segment (unaudited)

(in thousands)


Quarter Ended December 31, 2020

Rhode
Island


Mid-
Atlantic


Southeast


West


Other


Total

Revenue

$

32,402



$

26,454



$

35,483



$

22,642



$

1,115



$

118,096














Net income (loss)

$

15,103



$

(1,670)



$

(2,210)



$

4,274



$

4,726



$

20,223


Interest expense, net of interest income



25



(17)





19,237



19,245


(Benefit) provision for income taxes

(12,221)



(1,780)



(4,150)



(920)



(31,823)



(50,894)


Depreciation and amortization

3,681



1,689



2,824



1,513



81



9,788


Acquisition, integration and restructuring expense









6,273



6,273


Expansion and pre-opening expenses

342











342


Goodwill and asset impairment







105





105


Share-based compensation









8,238



8,238


Rebranding









792



792


Change in value of naming rights liabilities









57,660



57,660


Gain on bargain purchases









(63,871)



(63,871)


CARES Act credit (1)

163



(175)



22



9



1



20


Credit Agreement amendment expenses (1)









87



87


Storm related losses, net of insurance recoveries (1)





15,131







15,131


Bet.Works and Sinclair(1)









1,248



1,248


Sports and iGaming Licensing(1)









226



226


Other (1)

157









(3,711)



(3,554)


Allocation of corporate costs

1,597



1,303



1,747



1,115



(5,762)




Adjusted EBITDA

$

8,822



$

(608)



$

13,347



$

6,096



$

(6,598)



$

21,059



_______________________________

(1)

See descriptions of adjustments in the "Reconciliation of Net Income (Loss) and Net Income (Loss) Margin to Adjusted EBITDA and Adjusted EBITDA Margin (unaudited)" table above.

 

Quarter Ended December 31, 2019

Rhode
Island


Mid-
Atlantic


Southeast


Other


Total

Revenue

$

69,483



$

27,637



$

31,187



$

2,112



$

130,419












Net income

$

16,479



$

2,016



$

4,065



$

(9,205)



$

13,355


Interest expense, net of interest income



31



(7)



11,001



11,025


Provision for income taxes

6,399



1,363



1,345



(4,677)



4,430


Depreciation and amortization

4,733



1,390



2,896



42



9,061


Acquisition, integration and restructuring expense

21



58





1,042



1,121


Share-based compensation







1,019



1,019


Professional and advisory fees associated with capital return program







10



10


Credit Agreement amendment expenses (1)







764



764


Storm related losses, net of insurance recoveries







(1,181)



(1,181)


Other (1)







608



608


Allocation of corporate costs

1,813



556



807



(3,176)




Adjusted EBITDA

$

29,445



$

5,414



$

9,106



$

(3,753)



$

40,212



______________________________

(1)

See descriptions of adjustments in the "Reconciliation of Net Income (Loss) and Net Income (Loss) Margin to Adjusted EBITDA and Adjusted EBITDA Margin (unaudited)" table above.

 

BALLY'S CORPORATION

Revenue and Reconciliation of Net Income (Loss) to

Adjusted EBITDA by Segment (unaudited)

(in thousands)


Year Ended December 31. 2020

Rhode
Island


Mid-
Atlantic


Southeast


West


Other


Total

Revenue

$

132,028



$

73,676



$

114,832



$

47,332



$

4,924



$

372,792














Net income (loss)

20,276



(241)



10,486



(712)



(35,296)



(5,487)


Interest expense, net of interest income

(56)



132



(42)





62,602



62,636


(Benefit) provision for income taxes

(10,326)



(1,232)



(763)



(3,697)



(53,306)



(69,324)


Depreciation and amortization

17,310



6,082



10,037



4,104



309



37,842


Acquisition, integration and restructuring expense



20







13,237



13,257


Expansion and pre-opening expenses

921











921


Goodwill and asset impairment







8,659





8,659


Share-based compensation









17,706



17,706


Rebranding









792



792


Change in value of naming rights liabilities









57,660



57,660


Gain on bargain purchases









(63,871)



(63,871)


Professional and advisory fees associated with capital return program









(17)



(17)


CARES Act credit(1)

(2,215)



(755)



(548)



(361)



(49)



(3,928)


Credit Agreement amendment expenses (1)









810



810


Storm related losses, net of insurance recoveries(1)





15,131





(1,036)



14,095


Bet.Works and Sinclair(1)









1,248



1,248


Sports and iGaming Licensing(1)









226



226


Other (1)

157









(2,980)



(2,823)


Allocation of corporate costs

7,505



4,078



6,317



2,339



(20,239)




Adjusted EBITDA

$

33,572



$

8,084



$

40,618



$

10,332



$

(22,204)



$

70,402



_______________________________

(1)

See descriptions of adjustments in the "Reconciliation of Net Income (Loss) and Net Income (Loss) Margin to Adjusted EBITDA and Adjusted EBITDA Margin (unaudited)" table above.

 

Year Ended December 31, 2019

Rhode
Island


Mid-
Atlantic


Southeast


Other


Total

Revenue

$

306,306



$

80,806



$

127,432



$

9,033



$

523,577












Net income

$

71,124



$

6,031



$

18,165



$

(40,190)



$

55,130


Interest expense, net of interest income

3,265



145



(30)



34,546



37,926


Provision for income taxes

26,653



2,903



5,108



(14,614)



20,050


Depreciation and amortization

18,473



3,996



9,743



180



32,392


Non-operating income



(39)





(144)



(183)


Acquisition, integration and restructuring expense

425



1,155





10,588



12,168


Share-based compensation







3,826



3,826


Professional and advisory fees associated with capital return program







3,510



3,510


Credit Agreement amendment expenses (1)

1,038







1,877



2,915


Storm related losses, net of insurance recoveries(1)





(152)



(1,181)



(1,333)


Other (1)

(419)





275



893



749


Allocation of corporate costs

10,124



2,466



4,148



(16,738)




Adjusted EBITDA

$

130,683



$

16,657



$

37,257



$

(17,447)



$

167,150



_______________________________

(1)

See descriptions of adjustments in the "Reconciliation of Net Income (Loss) and Net Income (Loss) Margin to Adjusted EBITDA and Adjusted EBITDA Margin (unaudited)" table above.

 

BALLY'S CORPORATION


Calculation of Gross Gaming Revenue (unaudited)



Quarter Ended
December 31,




Year Ended
December 31,



(in thousands, except percentages)

2020


2019


Change


2020


2019


Change

Gaming revenue

$

95,467



$

88,531



7.8

%


$

291,658



$

367,948



(20.7)

%

Adjustment for State of RI's share of net terminal income, table games revenue and other gaming revenue (1)

52,927



96,906





206,526



401,772




Adjustment for State of DE's share of net terminal income, table games revenue and other gaming revenue at Dover Downs (1)

17,353



21,728





60,250



66,600




Gross gaming revenue

$

165,747



$

207,165



(20.0)

%


$

558,434



$

836,320



(33.2)

%


_______________________________

(1)

Adjustment made to show gaming revenue on a gross basis consistent with gross gaming win data provided throughout the gaming industry.

 

Reconciliation of Net Income (Loss) Per Diluted Share to

Adjusted Net Income (Loss) Per Diluted Share (unaudited)



Quarter Ended
December 31,


Year Ended
December 31,


2020


2019


2020


2019

Net income (loss) per diluted share

$

0.61



$

0.40



$

(0.18)



$

1.46


Acquisition, integration and restructuring expense

0.19



0.03



0.42



0.32


Goodwill and asset impairment





0.28




Storm related losses, net of insurance recoveries (1)

0.46



(0.03)



0.45



(0.03)


Expansion and pre-opening expenses

0.01





0.03




Change in value of naming rights liabilities

1.74





1.84




Gain on bargain purchases

(1.93)





(2.04)




Rebranding

0.02





0.03




Bet.Works and Sinclair(1)

0.04





0.04




Sports and iGaming Licensing(1)

0.01





0.01




Credit Agreement amendment expenses (1)



0.02



0.03



0.08


Professional and advisory fees associated with capital return program







0.09


CARES Act credit (1)





(0.13)




Other (1)

(0.11)



0.02



(0.09)



0.02


Tax effect of adjustments (2)

(0.66)



(0.01)



(0.78)



(0.13)


Adjusted net income (loss) per diluted share

$

0.39



$

0.42



$

(0.09)



$

1.81



_______________________________

Note:

Amounts in table may not subtotal due to rounding.

(1)

See descriptions of adjustments in the "Reconciliation of Net Income (Loss) and Net Income (Loss) Margin to Adjusted EBITDA and Adjusted EBITDA Margin (unaudited)" table above.

(2)

Represents the tax effect based upon the nature of the adjustments.

 

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SOURCE Bally's Corporation

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