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This presentation is not an offering of securities nor a solicitation for the sale or purchase of securities which can only be made by formal prospectus.
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The following statements are made pursuant to the safe harbor for forward-looking statements described in the Private Securities Litigation Reform Act of 1995. In these presentations, we may make certain statements that are forward-looking, such as statements regarding Full House’s future results and plans and anticipated trends in the industries and economies in which Full House operates.These forward-looking statements are the Company’s current expectations and the Company will make no effort to update these expectations based on subsequent events or knowledge. These forward-looking statements are subject to a number of risks, uncertainties, and assumptions, including that our revenues may differ from that projected, that governmental and court approvals may not be forthcoming or may be delayed:· Our growth strategies may not be realized;· Our development and potential acquisition of new facilities may not occur;· Trends in the gaming industries may be negative;· We may not have access to capital, including the ability to finance future business requirements;· There may be adverse changes in federal, state and local laws and regulations, including environmental and gaming license legislation and regulations; and· Other risks detailed in our documents filed with the SEC.Should one or more of these risks or uncertainties materialize, or should our underlying assumptions prove incorrect, actual results may differ significantly from results expressed or implied in any forward-looking statements made by the Company in these communications.
Full House Resorts owns, develops and manages gaming facilities
Through 50% joint venture – Gaming Entertainment Michigan (GEM) – managing the construction of FireKeepers Casino in Battle Creek, Michigan. Upon opening in summer 2009, GEM will manage the property – seven years, 26% of net income (50% interest in management fees)
Own and operate Stockman’s Casino in Fallon, Nevada
50% joint venture management agreement with Harrington Raceway & Casino in Delaware through August 20114
Successfully manage the construction and pre-opening activities of FireKeepers Casino, leading to an early August 2009 opening
Actively pursuing additional accretive value-added acquisitions in regional gaming markets
Continue to operate Stockman’s as a profitable, market-leading casino in Fallon, Nevada
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GEM acquired Green Acres Casino Management’s 15% interest in
the FireKeepers Casino management agreement for $10 million.
May 6 – assisted the Authority in obtaining and closing on $340 million of Senior Secured Notes and a $35 million F&E facility under very difficult financing conditions.
May 7 – gave notice to proceed to the contractor who immediately commenced site work.
FireKeepers progress:
Structure fully enclosed in November – ahead of schedule Indoor construction ongoing, parking garage construction on
schedule Strong experienced management team being assembled Dealer school commenced operations on May 1, 2009 Slot bases and machines are currently being installed Opening is scheduled for early August 2009
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GEM – a 50% owned JV – has a seven-year management agreement with the Huron Potawatomi Tribe to develop and manage their casino for a fee equal to 26% of net income.
Full House – through GEM – has been pursuing this development opportunity for over 10 years In first half of 2008, completed the design, negotiated
the GMP and completed the financing Commenced construction on May 7, 2008 Fully enclosed structure in November 2008 Garage construction progressing on schedule Installation of gaming F&E has commenced Expect to open the facility in early August 2009
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Primary local market of 1.1 million adults within 50 miles and no competing casinos Key feeder markets include Battle Creek, Grand Rapids,
Kalamazoo and Lansing
Easily accessible from
major highways: I-94, I-69 Mean household income
of $61,951 as of 2006 (source:
The Innovation Group)
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Note: Circles represent 50 and 100 mile radius from FireKeepers CasinoNote: Circles represent 50 and 100 mile radius from FireKeepers Casino ..
NY002H3E_1.wor
FireKeepers CasinoDetroit
Lansing
Ann ArborKalamazoo
Grand Rapids
Fort WayneFort WayneFort WayneFort WayneFort WayneFort WayneFort WayneFort WayneFort WayneToledoToledoToledoToledoToledoToledoToledoToledoToledo
ChicagoChicagoChicagoChicagoChicagoChicagoChicagoChicagoChicago
Milwaukee
Battle Creek
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Secondary market of 5.1 million adults within 1-2 hour drive-time Includes Ann Arbor, Birmingham, Brighton, Flint, Grand Haven,
Toledo and Fort Wayne Only two other competing gaming facilities (we will be the only
casino within a 75-mile radius and a 100-mile driving radius)
Seasonal and overnight market Over one million visitors a year to
Calhoun County Approximately 1,300 hotel rooms within 15 miles
____________________
Note: Circles represent 50 and 100 mile radius from FireKeepers CasinoNote: Circles represent 50 and 100 mile radius from FireKeepers Casino ..
NY002H3E_1.wor
FireKeepers CasinoDetroit
Lansing
Ann ArborKalamazoo
Grand Rapids
Fort WayneFort WayneFort WayneFort WayneFort WayneFort WayneFort WayneFort WayneFort WayneToledoToledoToledoToledoToledoToledoToledoToledoToledo
ChicagoChicagoChicagoChicagoChicagoChicagoChicagoChicagoChicago
Milwaukee
Battle Creek
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2,680 Class III Slot Machines 78 Table Games 12 Poker Tables Five restaurants and three bars High Limit Gaming and VIP areas 2,078-space parking garage attached to
the facility Scheduled to open August 2009
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Opportunistic strategic buyer
Criteria Market leading properties in local markets Near-term geographic preference in Nevada Size – Similar to Stockman’s Casino
Overlooked Asset – Conservative balance sheet $3.9 million cash, $7.9 million currently available on line of
credit Free cash flow Free cash flow increases significantly with the opening of
FireKeepers Casino in Michigan
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Adult (+25) Population
25 Mile 25,569
50 Mile 50,297
Home of Fallon Naval Air StationSource: Microsoft MapPoint 2006
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December 2007/January 2008 - Renovation of coffee shop and Steakhouse completed
February 2008 – Closed on sale of Holiday Inn Express – applied net proceeds of approximately $7.0 million to reduce indebtedness
For 2008, generated net revenues of $9.7 million and EBITDA of $3.0 million
Have repaid all but about $1.0 million of the original $17.25 million of acquisition debt
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Adult (+25) Population
25 Mile 177,202
50 Mile 680,716
100 Mile 9,868,262
Source: Microsoft MapPoint 2006
50% JV with Harrington Raceway for the management of the facility Management agreement through August 2011
Guaranteed minimum annual increase of 5% Harrington Raceway and Casino has approximately 2,100 gaming
positions following completion of major renovation and expansion in February 2008
450 seat buffet 50 seat diner Steakhouse and entertainment lounge
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Revenue
Casino $ 7,483,644 $ 7,228,181
Food and beverage 2,099,222 1,810,047
Other operating income 89,075 526,183Total Revenue 9,671,941 9,564,411
Operating costs and expenses
Operating Costs 4,720,919 4,189,118
Project development costs 151,120 431,437
Selling, general and administrative 6,262,084 6,811,321
Depreciation and amortization 1,213,636 1,016,494Operating Expenses 12,347,759 12,448,371
Operating gains (losses)
Equity in net income of unconsolidated joint venture 4,772,248 4,270,000
Unrealized gains on notes receivable, tribal governments 2,103,630 839,749
Impairment and settlement losses (585,000) (407,534)Total Operating Gains 6,290,878 4,702,215
Income from operations 3,615,060 1,818,255
Income from continuing operations 1,580,145 654,297
Income from discontinued operations, net of tax 38,145 286,294
Net income $ 1,618,290 $ 940,591
Diluted EPS $ 0.08 $ 0.05
Source: Company Documents
Year ended December 31,
2008 2007
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2008 2007
Cash 5,304,755$ 7,975,860$
Accounts receivable and other current assets 1,493,676 1,184,132
Assets held for sale 45,000 6,960,762
Net PP&E 8,630,024 9,227,113
Notes receivable for tribal projects 5,114,767 12,178,481
Contract rights 16,795,552 14,761,133
Other long-term assets 11,084,349 11,176,785
Total assets 48,468,123$ 63,464,266$
Current portion of long-term debt 225,224$ 259,124$
Accounts payable, accrued expenses and other liabilities 2,855,300 2,338,216
Long-term debt, net of current portion 6,204,239 22,966,023
Total liabilities 9,284,763 25,563,363
Non-controlling interest in consolidated joint venture 4,600,068 4,232,775
Shareholders' equity 34,583,292 33,668,128
Total liabilities and shareholders' equity 48,468,123$ 63,464,266$
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Reconciliation of EBITDA before unrealized
gains on tribal advances
Development/
For the 12 months ended 12/31/08 Casino Operations Management Corporate Consolidated
Income from continuing operations before
other income (expense) 1,963,511$ 5,620,319$ (3,968,770)$ 3,615,060$
Add Back:
Depreciation and amortization 1,086,323 58,637 68,676 1,213,636
Impairment and settlement losses - 585,000 - 585,000
Deduct:
Unrealized gains on valuation of tribal advances - 2,103,630 - 2,103,630
EBITDA before unrealized gains on tribal advances 3,049,834$ 4,160,326$ (3,900,094)$ 3,310,066$
Development/
For the 12 months ended 12/31/07 Casino Operations Management Corporate Consolidated
Income from continuing operations before
other income (expense) 2,582,677$ 4,499,104$ (5,263,526)$ 1,818,255$
Add Back:
Depreciation and amortization 946,253 62,028 8,213 1,016,494
Impairment and settlement losses - 407,534 - 407,534
Deduct:
Unrealized gains on valuation of tribal advances - 839,749 - 839,749
EBITDA before unrealized gains on tribal advances 3,528,930$ 4,128,917$ (5,255,313)$ 2,402,534$
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(unaudited)
Revenue
Casino $ 1,868,942 $ 1,965,049
Food and beverage 430,734 583,986
Other operating income 20,260 20,589Total Revenue 2,319,936 2,569,624
Operating costs and expenses
Operating Costs 1,060,570 1,200,059
Project development costs 15,695 34,792
Selling, general and administrative 1,529,893 1,594,621
Depreciation and amortization 290,552 270,542Operating Expenses 2,896,710 3,100,014
Operating gains
Equity in net income of unconsolidated joint venture 1,252,176 1,162,737
Unrealized gains on notes receivable, tribal governments 253,749 1,898,524Total Operating Gains 1,505,925 3,061,261
Operating Income 929,151 2,530,871
Income from continuing operations 536,205 1,000,749
Income from discontinued operations, net of tax - 38,141
Net income $ 536,205 $ 1,038,890
Diluted EPS $ 0.03 $ 0.05
Source: Company Documents
2009 2008
Three months
ended March 31,
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March 31, December 31,
2009 2008
Cash 3,945,527$ 5,304,755$
Accounts receivable and other current assets 1,207,544 1,538,676
Net PP&E 8,487,771 8,630,024
Notes receivable for tribal projects 5,368,516 5,114,767
Contract rights 16,782,247 16,795,552
Other long-term assets 11,077,951 11,084,349
Total assets 46,869,556$ 48,468,123$
Current portion of long-term debt 229,439$ 225,224$
Accounts payable, accrued expenses and other liabilities 2,957,650 2,855,300
Long-term debt, net of current portion 4,047,360 6,204,239
Total liabilities 7,234,449 9,284,763
Non-controlling interest in consolidated joint venture 4,540,888 4,600,068
Shareholders' equity 35,094,219 34,583,292
Total liabilities and shareholders' equity 46,869,556$ 48,468,123$
(unaudited)
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Reconciliation of EBITDA before unrealized
gains on tribal advances (unaudited)
Development/
Quarter Ended 3/31/09 Casino Operations Management Corporate Consolidated
Operating Income 555,816$ 1,353,560$ (980,225)$ 929,151$
Add Back:
Depreciation and amortization 256,885 13,449 20,218 290,552
Deduct:
Unrealized gains on valuation of tribal advances - 253,749 - 253,749
EBITDA before unrealized gains on tribal advances 812,701$ 1,113,260$ (960,007)$ 965,954$
Development/
Quarter Ended 3/31/08 Casino Operations Management Corporate Consolidated
Operating Income 737,651$ 2,985,616$ (1,192,396)$ 2,530,871$
Add Back:
Depreciation and amortization 243,877 19,152 7,513 270,542
Deduct:
Unrealized gains on valuation of tribal advances - 1,898,524 - 1,898,524
EBITDA before unrealized gains on tribal advances 981,528$ 1,106,244$ (1,184,883)$ 902,889$
Financial performance in Q1 was consistent with the prior year despite economic issues
The Company is in a strong liquidity position We continue to pursue our key objectives
Focused on a successful on-time and on-budget opening for the FireKeepers Casino in early August
Pursue additional acquisitions that fit our identified criteria and current financial resources
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Stockman’s Casino generated revenue of $9.7 million and EBITDA of $3.0 million.
Earnings from Harrington Raceway and Casino were up 11.8% as a result of our restructured management contract and timing of payments.
SG&A costs decreased mostly due to a reduction in employee-related expenses such as stock compensation.
Unrealized gains on Tribal receivables increased as projects saw changes in the discount rates and estimated opening dates – primarily due to the Michigan project being on schedule for a third quarter 2009 opening and a one-time payment of $9.3 million related to financing for the FireKeepers Casino in first quarter 2008.
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Net income of approximately $1.6 million is up approximately $0.7 million from last year’s results.
Net Income applicable to common shares was approximately $1.6 million or $0.08 per diluted share.
Weighted average diluted shares for 2008 were 19,116,311, slightly below last year’s count of 19,304,251 due to advent of share repurchase program in July 2008.
The board of directors approved a $2 million share repurchase plan in 2008. From the initial approval date in July to the program’s expiration on April 30, 2009, the Company repurchased 1.4 million shares at a total cost of approximately $1.7 million (weighted-average cost of $1.22 per share).
For 2008, the Company reduced its debt by $18.7 million, including the $9.5 million Green Acres obligation. The Company has only about $225k of debt repayment requirements in 2009 and no refinancing requirements.
Cash at year-end stood at approximately $5.3 million. In addition, the Company prepaid its NSB Revolving Credit Facility by $8.9 million and as a result had availability under the facility of $6.0 million.
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First quarter operating results were consistent with the prior year, exclusive of a one-time gain of approximately $1.4 million related to the $9.3 million repayment on the FDA receivable.
Stockman’s revenue performance in the first quarter was down 10%, reflecting weakness in the food and beverage segment due to economic weakness in the Northern Nevada market as well as increased food and beverage competition.
Operating expenses for first quarter 2009 were down 7%, primarily due to improved cost-control measures affecting nearly all aspects of the Company’s operations.
Equity in net income from our Delaware operation was up 8% from 2008; the Company is guaranteed a minimum 5% management fee increase in 2009 over 2008’s cash flow of $4.4 million.
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Unrealized gain on tribal receivables in the first quarter of 2008 included a one-time benefit of approximately $1.4 million due to the repayment by the tribe of $9.3 million related to financing for the FireKeepers Casino completed in May 2008. Excluding this item, the gain is comparable year-over-year. The Company has a fair market valuation allowance of $0.7 million against the remaining $5.0 million receivable.
EBITDA of $1.0 million was up from the prior-year amount of $0.9 million.
Net income for the quarter was approximately $0.5 million and earnings per share were $0.03. Excluding the one-time gain on the tribal receivable of $1.4 million, EPS in 2008 would also have been $0.03.
Cash as of March 31st stood at approximately $3.9 million, with availability on the Company’s revolving credit line with Nevada State Bank at approximately $7.9 million.
The Company paid down $2.3 million of debt during the first quarter, reducing its current debt outstanding, including current maturities, to $4.3 million.
