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Note 9 - Segment Information

9 Months Ended

Sep. 30, 2022

Segment Reporting Disclosure [Text Block]

NOTE 9. SEGMENT INFORMATION

We have aggregated our properties in order to present three Reportable Segments: (i) Las Vegas Locals; (ii) Downtown Las Vegas; and (iii) Midwest & South. The table below lists the classification of each of our properties.

Las Vegas Locals
Gold Coast Hotel and Casino		Las Vegas, Nevada
The Orleans Hotel and Casino		Las Vegas, Nevada
Sam's Town Hotel and Gambling Hall		Las Vegas, Nevada
Suncoast Hotel and Casino		Las Vegas, Nevada
Eastside Cannery Casino and Hotel ⁽¹⁾		Las Vegas, Nevada
Aliante Casino + Hotel + Spa		North Las Vegas, Nevada
Cannery Casino Hotel		North Las Vegas, Nevada
Jokers Wild		Henderson, Nevada
Downtown Las Vegas
California Hotel and Casino		Las Vegas, Nevada
Fremont Hotel & Casino		Las Vegas, Nevada
Main Street Station Hotel and Casino		Las Vegas, Nevada
Midwest & South
Par-A-Dice Casino ⁽²⁾		East Peoria, Illinois
Belterra Casino Resort ⁽⁴⁾		Florence, Indiana
Blue Chip Casino Hotel Spa		Michigan City, Indiana
Diamond Jo Casino		Dubuque, Iowa
Diamond Jo Worth		Northwood, Iowa
Kansas Star Casino		Mulvane, Kansas
Amelia Belle Casino		Amelia, Louisiana
Delta Downs Racetrack Hotel & Casino		Vinton, Louisiana
Evangeline Downs Racetrack & Casino		Opelousas, Louisiana
Sam's Town Shreveport		Shreveport, Louisiana
Treasure Chest Casino		Kenner, Louisiana
IP Casino Resort Spa		Biloxi, Mississippi
Sam's Town Hotel and Gambling Hall Tunica		Tunica, Mississippi
Ameristar Casino * Hotel Kansas City ⁽⁴⁾		Kansas City, Missouri
Ameristar Casino * Resort * Spa St. Charles ⁽⁴⁾		St. Charles, Missouri
Belterra Park ⁽⁴⁾		Cincinnati, Ohio
Valley Forge Casino Resort ⁽³⁾		King of Prussia, Pennsylvania

⁽¹⁾ Eastside Cannery remains closed since March 18, 2020 due to the current levels of demand in the market.

⁽²⁾Par-A-Dice was temporarily closed on November 20, 2020 and subsequently reopened on January 16, 2021.

⁽³⁾ Valley Forge was temporarily closed on December 12, 2020 and subsequently reopened on January 4, 2021.

⁽⁴⁾ Property is subject to a master lease agreement with a real estate investment trust.

Results of Operations - Total Reportable Segment Revenues and Adjusted EBITDAR

We evaluate each property's profitability based on Property Adjusted EBITDAR, which represents each property's earnings before interest expense, income taxes, depreciation and amortization, deferred rent, share-based compensation expense, project development, preopening and writedown expenses, impairments of assets, other operating items, net, gain or loss on early extinguishments and modifications of debt, other items, net and master lease rent expense, as applicable. Total Reportable Segment Adjusted EBITDAR is the aggregate sum of the Property Adjusted EBITDAR for each of the properties included in our Las Vegas Locals, Downtown Las Vegas, and Midwest & South segments. Results for Downtown Las Vegas include the results of our Hawaii-based travel agency and captive insurance company as our Downtown Las Vegas properties cater to the Hawaiian market. Results for our Midwest & South segment include the following non-reportable segments: (i) Lattner, our Illinois distributed gaming operator; (ii) online gaming operations, which are in New Jersey and six of the nine states in the Midwest & South where we operate properties; and (iii) our management agreement with Wilton Rancheria.

EBITDAR is a commonly used measure of performance in our industry that we believe, when considered with measures calculated in accordance with GAAP, facilitates comparisons between us and our competitors and provides our investors a more complete understanding of our operating results before the impact of investing transactions, financing transactions and income taxes. Management has historically adjusted EBITDAR when evaluating operating performance because we believe that the inclusion or exclusion of certain recurring and non-recurring items is necessary to provide a full understanding of our core operating results and as a means to evaluate period-to-period results.

The following tables set forth, for the periods indicated, departmental revenues for our Reportable Segments:

	*Three Months Ended September 30, 2022*
			*Food &*
	*Gaming*		*Beverage*		*Room*		*Other*		*Total*
*(In thousands)*	*Revenue*		*Revenue*		*Revenue*		*Revenue*		*Revenue*
Revenues
Las Vegas Locals	$	172,263	$	21,120	$	19,982	$	12,426	$	225,791
Downtown Las Vegas		31,872		9,583		5,552		2,500		49,507
Midwest & South		463,840		37,089		21,138		79,898		601,965
Total Revenues	$	667,975	$	67,792	$	46,672	$	94,824	$	877,263

	*Three Months Ended September 30, 2021*
			*Food &*
	*Gaming*		*Beverage*		*Room*		*Other*		*Total*
*(In thousands)*	*Revenue*		*Revenue*		*Revenue*		*Revenue*		*Revenue*
Revenues
Las Vegas Locals	$	179,441	$	20,412	$	20,176	$	11,235	$	231,264
Downtown Las Vegas		28,132		7,343		4,000		2,662		42,137
Midwest & South		466,654		33,346		20,141		49,518		569,659
Total Revenues	$	674,227	$	61,101	$	44,317	$	63,415	$	843,060

	*Nine Months Ended September 30, 2022*
			*Food &*
	*Gaming*		*Beverage*		*Room*		*Other*		*Total*
*(In thousands)*	*Revenue*		*Revenue*		*Revenue*		*Revenue*		*Revenue*
Revenues
Las Vegas Locals	$	522,728	$	64,257	$	62,528	$	40,301	$	689,814
Downtown Las Vegas		99,249		29,865		17,152		6,624		152,890
Midwest & South		1,398,877		107,712		59,305		223,858		1,789,752
Total Revenues	$	2,020,854	$	201,834	$	138,985	$	270,783	$	2,632,456

	*Nine Months Ended September 30, 2021*
			*Food &*
	*Gaming*		*Beverage*		*Room*		*Other*		*Total*
*(In thousands)*	*Revenue*		*Revenue*		*Revenue*		*Revenue*		*Revenue*
Revenues
Las Vegas Locals	$	516,174	$	52,959	$	49,344	$	31,305	$	649,782
Downtown Las Vegas		70,168		17,657		9,269		5,256		102,350
Midwest & South		1,433,273		92,025		50,771		161,768		1,737,837
Total Revenues	$	2,019,615	$	162,641	$	109,384	$	198,329	$	2,489,969

The following table reconciles, for the periods indicated, Total Reportable Segment Adjusted EBITDAR to net income, as reported in our accompanying condensed consolidated statements of operations:

	*Three Months Ended*						*Nine Months Ended*
	*September 30,*						*September 30,*
*(In thousands)*	*2022*			*2021*			*2022*			*2021*
Adjusted EBITDAR
Las Vegas Locals	$	111,733		$	125,360		$	355,762		$	349,572
Downtown Las Vegas		17,704			13,222			58,216			31,083
Midwest & South		230,195			222,058			682,725			700,199
Corporate expense		(21,934	)		(19,943	)		(66,296	)		(62,165	)
Adjusted EBITDAR		337,698			340,697			1,030,407			1,018,689
Other operating costs and expenses
Deferred rent		192			207			576			621
Master lease rent expense		26,828			26,306			79,788			78,396
Depreciation and amortization		64,956			67,586			194,191			199,332
Share-based compensation expense		5,653			9,783			28,486			28,307
Project development, preopening and writedowns		9,645			10,646			528			13,515
Impairment of assets		5,575			—			5,575			—
Other operating items, net		(12,610	)		3,023			(12,324	)		15,295
Total other operating costs and expenses		100,239			117,551			296,820			335,466
Operating income		237,459			223,146			733,587			683,223
Other expense (income)
Interest income		(2,073	)		(442	)		(2,976	)		(1,406	)
Interest expense, net of amounts capitalized		36,001			45,171			110,125			158,192
Loss on early extinguishments and modifications of debt		—			42			19,809			65,517
Other, net		170			119			3,667			2,288
Total other expense, net		34,098			44,890			130,625			224,591
Income before income taxes		203,361			178,256			602,962			458,632
Income tax provision		(46,359	)		(40,082	)		(136,269	)		(104,568	)
Net income	$	157,002		$	138,174		$	466,693		$	354,064

For purposes of this presentation, corporate expense excludes its portion of share-based compensation expense. Corporate expense represents unallocated payroll, professional fees, aircraft expenses and various other expenses not directly related to our casino and hotel operations.

Total Reportable Segment Assets

The Company's assets by Reportable Segment consisted of the following amounts:

	*September 30,*		*December 31,*
*(In thousands)*	*2022*		*2021*
Assets
Las Vegas Locals	$	1,604,202	$	1,641,409
Downtown Las Vegas		249,654		228,161
Midwest & South		3,862,883		3,947,076
Total Reportable Segment Assets		5,716,739		5,816,646
Corporate		339,131		407,523
Total Assets	$	6,055,870	$	6,224,169

- Definition

The entire disclosure for reporting segments including data and tables. Reportable segments include those that meet any of the following quantitative thresholds a) it's reported revenue, including sales to external customers and intersegment sales or transfers is 10 percent or more of the combined revenue, internal and external, of all operating segments b) the absolute amount of its reported profit or loss is 10 percent or more of the greater, in absolute amount of 1) the combined reported profit of all operating segments that did not report a loss or 2) the combined reported loss of all operating segments that did report a loss c) its assets are 10 percent or more of the combined assets of all operating segments.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
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-Section 50
-Paragraph 31
-URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e8924-108599

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
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-Name Accounting Standards Codification
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