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9. Segment Information
The Company has aggregated its properties into three reportable segments: (i) Midwest, (ii) East/West, and (iii) Southern Plains, which is consistent with how the Company’s Chief Operating Decision Maker reviews and assesses the Company’s financial performance.
The Midwest reportable segment consists of the following properties: Hollywood Casino Lawrenceburg, Hollywood Casino Aurora, Hollywood Casino Joliet, and Argosy Casino Alton. It also includes the Company’s Casino Rama management service contract as well as the two Ohio properties that are currently under construction, Hollywood Casino Toledo and Hollywood Casino Columbus, which are scheduled to open on, or about May 29, 2012 and early in the fourth quarter of 2012, respectively.
The East/West reportable segment consists of the following properties: Hollywood Casino at Charles Town Races, Hollywood Casino Perryville, Hollywood Casino Bangor, Hollywood Casino at Penn National Race Course, Zia Park Casino, and M Resort.
The Southern Plains reportable segment consists of the following properties: Argosy Casino Riverside, Argosy Casino Sioux City, Hollywood Casino Baton Rouge, Hollywood Casino Tunica, Hollywood Casino Bay St. Louis, and Boomtown Biloxi. It also includes the Company’s 50% investment in Kansas Entertainment, which owns the Hollywood Casino at Kansas Speedway which opened in February 2012.
The Other category consists of the Company’s standalone racing operations, namely Beulah Park, Raceway Park, Rosecroft Raceway, Sanford-Orlando Kennel Club, and the Company’s joint venture interests in Sam Houston Race Park and Valley Race Park and Freehold Raceway. It also included the Company’s joint venture interest in the Maryland Jockey Club which was sold in July 2011. If the Company is successful in obtaining gaming operations at these locations, they would be assigned to one of the Company’s regional executives and reported in their respective reportable segment. The Other category also includes the Company’s corporate overhead operations which does not meet the definition of an operating segment under ASC 280, “Segment Reporting,” and Bullwhackers.
The following tables present certain information with respect to the Company’s segments. Intersegment revenues between the Company’s segments were not material in any of the periods presented below.
|
|
|
Midwest |
|
East/West (1) |
|
Southern Plains (2) |
|
Other |
|
Total |
|
|
|
|
(in thousands) |
|
|
Three months ended March 31, 2012 |
|
|
|
|
|
|
|
|
|
|
|
|
Net revenues |
|
$ |
205,110 |
|
$ |
370,629 |
|
$ |
149,720 |
|
$ |
10,600 |
|
$ |
736,059 |
|
|
Income (loss) from operations |
|
46,281 |
|
83,891 |
|
44,712 |
|
(32,269 |
) |
142,615 |
|
|
Depreciation and amortization |
|
17,552 |
|
22,241 |
|
11,388 |
|
2,156 |
|
53,337 |
|
|
Gain from unconsolidated affiliates |
|
— |
|
— |
|
1,678 |
|
7 |
|
1,685 |
|
|
Capital expenditures |
|
101,880 |
|
10,659 |
|
3,932 |
|
3,188 |
|
119,659 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three months ended March 31, 2011 |
|
|
|
|
|
|
|
|
|
|
|
|
Net revenues |
|
213,811 |
|
288,383 |
|
155,090 |
|
9,739 |
|
667,023 |
|
|
Income (loss) from operations |
|
52,676 |
|
59,738 |
|
39,509 |
|
(29,188 |
) |
122,735 |
|
|
Depreciation and amortization |
|
15,644 |
|
20,567 |
|
14,664 |
|
2,283 |
|
53,158 |
|
|
Loss from unconsolidated affiliates |
|
— |
|
— |
|
(322 |
) |
(2,032 |
) |
(2,354 |
) |
|
Capital expenditures |
|
33,206 |
|
13,994 |
|
6,628 |
|
696 |
|
54,524 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance sheet at March 31, 2012 |
|
|
|
|
|
|
|
|
|
|
|
|
Total assets |
|
1,951,980 |
|
1,244,016 |
|
1,061,173 |
|
392,794 |
|
4,649,963 |
|
|
Investment in and advances to unconsolidated affiliates |
|
— |
|
110 |
|
147,982 |
|
67,324 |
|
215,416 |
|
|
Goodwill and other intangible assets, net |
|
924,489 |
|
226,074 |
|
394,018 |
|
55,864 |
|
1,600,445 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance sheet at December 31, 2011 |
|
|
|
|
|
|
|
|
|
|
|
|
Total assets |
|
1,897,164 |
|
1,265,438 |
|
1,034,506 |
|
409,238 |
|
4,606,346 |
|
|
Investment in and advances to unconsolidated affiliates |
|
— |
|
110 |
|
107,204 |
|
66,802 |
|
174,116 |
|
|
Goodwill and other intangible assets, net |
|
925,822 |
|
226,234 |
|
394,018 |
|
55,878 |
|
1,601,952 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) Net revenue and income from operations for the East/West segment increased by $82.2 million and $24.2 million, respectively, for the three months ended March 31, 2012, as compared to the three months ended March 31, 2011, primarily related to the acquisition of the M Resort on June 1, 2011, as well as the continued impact from the introduction of table games in July 2010 at Hollywood Casino at Charles Town Races.
(2) Gain from unconsolidated affiliates for the Southern Plains segment was impacted by the opening of Hollywood Casino at Kansas Speedway on February 3, 2012.
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