Monarch Casino & Resort Inc (MCRI, Financial) released its Q3 2023 earnings report on October 18, 2023. The company reported a slight decrease in net revenue and net income compared to the same period last year. Despite these challenges, the company remains confident in its growth strategies and has declared a cash dividend of $0.30 per share.
Financial Highlights
MCRI reported Q3 2023 net revenue of $132.96 million, a 0.6% decrease from $133.73 million in Q3 2022. Net income for the quarter was $24.16 million, a 12.1% decrease from $27.49 million in the same period last year. The company's Adjusted EBITDA for the quarter was $49.22 million, a 4.8% decrease from $51.69 million in Q3 2022. Basic earnings per share for Q3 2023 were $1.26, a 13.1% decrease from $1.45 in Q3 2022.
John Farahi, Co-Chairman and Chief Executive Officer of Monarch, commented: “Our 2023 third quarter results were strong as we continued to grow revenue and EBITDA in Black Hawk, and companywide, employed operational efficiencies and expense management. During the third quarter our operating results were negatively impacted by competitive pressure in Reno and the current macroeconomic environment. Third quarter net revenue and Adjusted EBITDA were $133.0 million and $49.2 million, respectively, leading to an Adjusted EBITDA margin of 37.0%."
Operational Challenges and Future Plans
MCRI's operating results for Q3 2023 were negatively impacted by legal and consulting costs related to ongoing litigation with the Monarch Black Hawk general contractor, PCL Construction Services, Inc. The impact during the third quarter of 2023 and 2022 was $2.9 million and $2.8 million, respectively. Despite these challenges, the company remains committed to its growth strategies and plans to further expand its market share among mid-to-upper tier players.
Dividend Declaration
The company announced a cash dividend of $0.30 per share of its outstanding common stock. The dividend is payable on December 15, 2023, to stockholders of record on December 1, 2023. This cash dividend is part of the previously announced annual cash dividend of $1.20 per share payable in quarterly payments and subject to quarterly review and evaluation by the Company’s Board of Directors.
Looking Ahead
Despite the slight decrease in net revenue and net income for Q3 2023, MCRI remains confident in its growth strategies. The company plans to continue investing in its existing properties, pay cash dividends, and consider potential share repurchases under its existing share repurchase authorization. It will also continue to evaluate potential acquisition opportunities where it can employ its development and operating expertise in a financially prudent manner.
