Monarch Casino & Resort Inc. (MCRI) filed Quarterly Report for the period ended 2009-06-30.
Monarch Casino & Resort Inc. through its wholly-owned subsidiary GoldenRoad Motor Inn Inc. owns and operates the tropically-themed Atlantis Casino Resort in Reno Nevada. Monarch Casino & Resort Inc. has a market cap of $154.45 million; its shares were traded at around $9.58 with a P/E ratio of 21.29 and P/S ratio of 1.09. Monarch Casino & Resort Inc. had an annual average earning growth of 10.5% over the past 5 years.
Highlight of Business Operations:
For the three-month period ended June 30, 2009, our net income was $1.8 million, or $0.11 per diluted share, on net revenues of $34.5 million, a decrease from net income of $2.8 million, or $0.16 per diluted share, on net revenues of $35.3 million for the three months ended June 30, 2008. Income from operations for the three months ended June 30, 2009 totaled $3.3 million, a 25.0% decrease when compared to $4.4 million for the same period in 2008. Net revenues decreased 2.3%, and net income decreased 35.7%, when compared to last year’s second quarter.
Hotel revenues were $5.9 million for the second quarter of 2009, an increase of 5.4% from the $5.6 million reported in the 2008 second quarter. This increase was due to increased revenue from our new spa which opened in January 2009, higher average daily room rate (“ADR”) and revenue from a $10 per day resort fee, paid by our hotel guests, which we implemented effective June 1, 2009 partially offset by lower hotel occupancy. Both second quarters’ 2009 and 2008 revenues also included a $3 per occupied room energy surcharge. During the second quarter of 2009, the Atlantis experienced an 85.2% occupancy rate, as compared to 86.5% during the same period in 2008. The Atlantis’ ADR was $65.77 in the second quarter of 2009 compared to $64.08 in the second quarter of 2008. Hotel operating expenses as a percent of hotel revenues decreased to 34.8% in the 2009 second quarter, compared to 35.5% in the 2008 second quarter. This decrease is primarily due to the effect of the increased revenue partially offset by a slight increase in operating expense of $80 thousand or 3.9%.
SG&A expense totaled $12.3 million in the second quarter of 2009, a 4.7% decrease from $12.9 million in the second quarter of 2008. The decrease was primarily due to lower marketing expense of approximately $370 thousand; lower payroll and benefits expense of approximately $160 thousand; lower rental expense of approximately $110 thousand and various expense level reductions of approximately $570 thousand all partially offset by higher bad debt expense of approximately $340 thousand and higher utility expense of approximately $300 thousand. SG&A expense as a percentage of net revenues decreased to 35.7% for the second quarter of 2009 as compared to 36.4% in the second quarter of 2008. This decrease is the result of the effect of the decreased expenses partially offset by the effect of decrease in net revenue.
For the six months ended June 30, 2009, our net income was $2.7 million, or $0.17 per diluted share, on net revenues of $67.0 million, a decrease from net income of $5.1 million, or $0.29 per diluted share, on net revenues of $69.6 million during the six months ended June 30, 2008. Income from operations for the 2009 six-month period totaled $5.2 million, compared to $7.7 million for the same period in 2008. Net revenues decreased 3.7%, and net income decreased 47.1% when compared to the six-month period ended June 30, 2008.
Hotel revenues for the first six months of 2009 decreased slightly to $11.3 million from $11.4 million for the first six months of 2008. This decrease was due to a decrease in hotel occupancy partially offset by a slight increase in the average daily room rate (“ADR”), higher revenue from our new spa which opened in January 2009 and revenue from a $10 per day resort fee, paid by our hotel guests, which we implemented on June 1, 2009. Hotel revenues for the entire first six months of 2009 and 2008 also include a $3 per occupied room energy surcharge. The Atlantis experienced a slight increase in the ADR during the 2009 six-month period to $66.32, compared to $66.29 for the same period in 2008. The occupancy rate decreased to 82.0% for the six-month period in 2009, from 86.1% for the same period in 2008. Hotel operating expenses as a percentage of hotel revenues in the first six months of 2009 were
SG&A expense decreased 8.1% to $23.9 million in the first six months of 2009, compared to $26.0 million in the first six months of 2008, primarily as a result lower payroll and benefits expense of approximately $940 thousand, lower marketing expense of approximately $830 thousand and various expense level reductions of approximately $980 thousand all partially offset by higher utilities expense of approximately $490 thousand and higher bad debt expense of approximately $210 thousand. As a percentage of net revenue, SG&A expenses decreased to 35.7% in the 2009 six-month period from 37.3% in the same period in 2008. This decrease is the result of the effect of the decreased expenses partially offset by the effect of the decrease in net revenue.
MCRI is in the portfolios of Chuck Akre of Akre Capital Management, LLC.
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