Note 12 – Segment Information

The Company conducts its business through two reportable operating segments: Casinos and Distributed Gaming. The Company’s Casinos segment involves the ownership and operation of eight resort casino properties in Nevada and Maryland. The Company’s Distributed Gaming segment involves the installation, maintenance and operation of slots and amusement devices in certain strategic, high-traffic, non-casino locations (such as grocery stores, convenience stores, restaurants, bars, taverns and liquor stores) in Nevada and Montana, and the operation of wholly-owned branded taverns targeting local patrons located primarily in the greater Las Vegas, Nevada metropolitan area. The Corporate and Other segment includes the Company’s cash and cash equivalents, miscellaneous receivables and corporate overhead. Costs recorded in the Corporate and Other segment have not been allocated to the Company’s reportable operating segments because these costs are not easily allocable and to do so would not be practical.

Results of Operations - Segment Net Income (Loss), Revenues and Adjusted EBITDA

The Company evaluates each segment’s profitability based upon such segment’s Adjusted EBITDA, which represents each segment’s earnings before interest and other non-operating income (expense), income taxes, depreciation and amortization, preopening expense, acquisition expenses, class action litigation expenses, share-based compensation expenses, executive severance, gain/loss on disposal of property and equipment and other gains and losses, calculated before corporate overhead (which is not allocated to each segment).

The following tables set forth, for the periods indicated, certain operating data for the Company’s segments, and reconciles Adjusted EBITDA to net income (loss):

	Three Months Ended March 31, 2018
(In thousands)	Casinos		Distributed Gaming		Corporate and Other			Consolidated
Revenues
Gaming	$	64,459	$	69,404	$	—		$	133,863
Food and beverage		29,996		12,607		—			42,603
Rooms		26,065		—		—			26,065
Other		9,967		2,150		141			12,258
Total revenues	$	130,487	$	84,161	$	141		$	214,789

Net income (loss)	$	23,841	$	7,448	$	(27,359	)	$	3,930
Depreciation and amortization		19,635		5,148		454			25,237
Acquisition expenses		—		—		1,112			1,112
Loss on disposal of property and equipment		62		15		—			77
Share-based compensation		—		—		1,844			1,844
Preopening expenses		—		148		300			448
Class action litigation expenses		13		—		104			117
Executive severance		51		35		101			187
Other, net		24		167		—			191
Interest expense, net		24		46		14,673			14,743
Change in fair value of derivative		—		—		(3,211	)		(3,211	)
Income tax provision		—		—		1,219			1,219
Adjusted EBITDA	$	43,650	$	13,007	$	(10,763	)	$	45,894

	Three Months Ended March 31, 2017
(In thousands)	Casinos		Distributed Gaming		Corporate and Other			Consolidated
Revenues
Gaming	$	18,324	$	67,855	$	—		$	86,179
Food and beverage		3,408		11,464		—			14,872
Rooms		1,488		—		—			1,488
Other		1,071		2,195		78			3,344
Total revenues	$	24,291	$	81,514	$	78		$	105,883

Net income (loss)	$	4,727	$	8,221	$	(7,606	)	$	5,342
Depreciation and amortization		1,571		4,634		347			6,552
Share-based compensation		—		—		1,427			1,427
Preopening expenses		—		209		63			272
Interest expense, net		4		42		1,637			1,683
Income tax benefit		—		—		(1,707	)		(1,707	)
Adjusted EBITDA	$	6,302	$	13,106	$	(5,839	)	$	13,569

Total Segment Assets

The Company’s assets by segment consisted of the following amounts:

(In thousands)	Casinos		Distributed Gaming		Corporate and Other		Consolidated
Balance at March 31, 2018	$	1,036,327	$	296,796	$	57,815	$	1,390,938

Balance at December 31, 2017	$	1,039,025	$	298,453	$	27,697	$	1,365,175