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Description Of Business And Basis Of Presentation | 9 Months Ended
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Sep. 30, 2017
Description Of Business And Basis Of Presentation [Abstract] |
Description Of Business And Basis Of Presentation | 1.DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION ﻿ Century Casinos, Inc. (“CCI” or the “Company”) is an international casino entertainment company. As of September 30, 2017, the Company owned casino operations in North America; was developing a casino in England and a racetrack and entertainment center (“REC”) in Edmonton, Canada; held a majority ownership interest in six casinos throughout Poland, a REC in Calgary, Canada and the pari-mutuel off-track betting network in southern Alberta, Canada; managed cruise ship-based casinos on international waters; managed a casino in Aruba and provide d gaming services in Argentina. ﻿ The Company currently owns, operates and manages the following casinos through wholly-owned subsidiaries in North America: ﻿
| · |  | The Cen tury Casino & Hotel in Edmonton, Alberta, Canada (“Century Resorts Alberta” or “CRA”)
| · |  | The Century Casino St. Albert in Edmonton, Alberta, Canada (“CSA”)
| · |  | The Century Casino Calgary, Alberta, Canada (“CAL”)
| · |  | The Century Casino & Hotel in Central City, Colorado (“CTL”); and
| · |  | The Century Casino & Hotel in Cripple Creek, Colorado (“CRC”)
﻿ The Company currently has a controlling financial interest through its subsidiary Century Casinos Europe GmbH (“CCE”) in the following majority-owned subsidiaries: ﻿
| · |  | T he Company owns 66.6% of Casinos Poland Ltd (“CPL” or “Casinos Poland”). CPL is the owner and operator of six casinos throughout Poland. CPL is consolidated as a majority-owned subsidiary for which the Company has a controlling financial interest. Polish Airports Company (“Polish Airports”) owns the remaining 33.3% of CPL, which is reported as a non-controlling financial interest.
﻿
| · |  | The Company owns 75% of United Horsemen of Alberta Inc. dba Century Downs Racetrack and Casino (“CDR” or “Century Downs”). CDR operates Century Downs Racetrack and Casino, a REC in Balzac, a north metropolitan area of Calgary, Alberta, Canada. CDR is consolidated as a majority-owned subsidiary for which the Company has a controlling financial interest. The remaining 25% of CDR is owned by unaffiliated shareholders and is reported as a non-controlling financial interest.
﻿
| · |  | The Company owns 75% of Century Bets! Inc. (“CBS” or “Century Bets”). CBS operates the pari-mutuel off-track betting network in Southern Alberta, Canada. CBS is consolidated as a majority-owned subsidiary for which the Company has a controlling financial interest. Rocky Mountain Turf Club (“RMTC”) owns the remaining 25% of CBS, which is reported as a non-controlling financial interest.
﻿ The Company has the following concession, management and consulting service agreements: ﻿
| · |  | The Company operates 14 ship-based casinos through concession agreements with four cruise ship owners. The Company began operating the ship-based casino onboard Mein Schiff 6, a new 2,500 passenger cruise ship, in May 2017.
﻿ In connection with a concession agreement with Diamond Cruise International Co., Ltd. (“Diamond”) for the operation of the ship-based casino onboard Glory Sea, the Company has a Cooperation Agreement with Dynamic Partners International, Ltd. (“Dynamic”). Under this agreement, Dynamic markets and promotes the casino to VIP players along with facilitating the concession agreement between Diamond and the Company, for which the Company pays Dynamic a portion of the net profit from the casino onboard Glory Sea. ﻿ In March 2015, in connection with an agreement with Norwegian Cruise Line Holdings (“Norwegian”) to terminate the Company’s concession agreements with Oceania Cruises (“Oceania”) and Regent Seven Seas Cruises (“Regent”), t he Company entered into a two-year consulting agreement, which became effective on June 1, 2015, under which the Company provided limited consulting services for the ship-based casinos of Oceania and Regent in exchange for receiving a consulting fee of $2.0 million, which wa s payable $250,000 per quarter through May 2017. ﻿
| · |  | The Company has a management agreement to direct the operation of the casino at the Hilton Aruba Caribbean Resort & Casino from which the Company receives a monthly management fee. The management agreement was not extended by the Company and ends on November 30, 2017.
﻿
| · |  | The Company, through its subsidiary CCE, has a 7.5% ownership interest in Mendoza Central Entretenimientos S.A., an Argentina company (“MCE”). The shares are reported on the condensed consolidated balance sheet using the cost method of accounting. MCE has an exclusive concession agreement with Instituto Provincial de Juegos y Casinos to lease slot machines and provide related services to Casino de Mendoza, a casino located in Mendoza, Argentina and owned by the Province of Mendoza. In addition, CCE and MCE have entered into a c onsulting s ervices a greement pursuant to which CCE provides advice on casino matters and receives a service fee consisting of a fixed fee plus a percentage of MCE’s earnings before interest, taxes, depreciation and amortization (“EBITDA”). See Note 4 for additional information related to MCE.
﻿ Additional Projects and Other Developments ﻿ In September 2016, the Company was selected by Horse Racing Alberta (“HRA”) as the successful applicant to own, build and operate a horse racing facility in the Edmonton market area, which the Company is planning to operate as Century Mile Racetrack and Casino. In March 2017, the Company received approval for the Century Mile project from the Alberta Gaming and Liquor Commission (“AGLC”). Century Mile will be a one-mile horse racetrack and a multi-level REC. The multi-level REC is expected to have 550 slot machines, restaurants, bars, delis, an off-track betting parlor and grandstand and to hold a minimum of 100 horse races per year. The project is located on Edmonton International Airport land close to the city of Leduc, south of Edmonton. Century Mile will be approximately 30 miles from both CRA and CSA. The Company estimates this project will cost approximately CAD 60.0 million ($48.1 million based on the exchange rate in effect on September 30, 2017). Construction of the Century Mile project began in July 2017. The Company estimates that construction of this project will take approximately 15 months and that it will be completed during the fourth quarter of 2018. The Company is seeking to obtain financing for the Century Mile project. ﻿ In June 2017, the Company’s subsidiary, CCE, entered into a Share Purchase Agreement (the “Agreement”), by and among Global Gaming Ventures (Group) Limited, Saw Close Casino Ltd. (“SCCL”), Anthony Wollenberg and CCE pursuant to which CCE has acquired 100% of the outstanding common stock of SCCL as well as casino licenses held by SCCL (the “SCCL License Acquisition”) for a total consideration of GBP 0.6 million ($0.8 million based on the exchange rate in effect on September 30, 2017) as well as assumed liabilities of GBP 0.2 million ($0.3 million based on the exchange rate in effect on September 30, 2017). The Company will utilize the casino licenses to develop and operate a casino in Bath, England. The Company paid GBP 0.1 million ($0.1 million) at closing. Payment of the remaining purchase consideration will be made after the receipt of certain regulatory and governmental approvals and the opening of the casino. Payment of the assumed liabilities is subject to certain performance criteria being met once the casino is in operation. The Company estimates that construction of the casino will cost GBP 5.0 million ($6.7 million based on the exchange rate in effect on September 30, 2017) and that the casino will open in the first half of 2018. ﻿ In August 2017, the Company announced that, together with the owner of the Hamilton Princess Hotel & Beach Club in Hamilton, Bermuda, it had submitted a license application to the Bermudan government for a casino at the Hamilton Princess Hotel & Beach Club. The casino will feature approximately 200 slot machines, 17 live table games, one or more electronic table games and a high limit area and salon prive. The Bermudan government will issue a provisional casino license as the next step in the application process. The conditions of the provisional casino license must be agreed upon by the Bermudan government and the company awarded the license. The Company currently has no estimated time frame on when this will be completed, and there is no guarantee that a license will be awarded. The Company’s subsidiary, CCE, entered into a long-term management agreement with the owner of the hotel to manage the operations of the casino and receive a management fee if a license is awarded. CCE will also provide a $5.0 million loan for the purchase of casino equipment if the license is awarded. ﻿ Preparation of Financial Statements ﻿ The accompanying condensed consolidated financial statements and related notes have been prepared in accordance with accounting principles generally accepted in the United States of America (“US GAAP”) for interim financial reporting, the rules and regulations of the Securities and Exchange Commission which apply to interim financial statements and the instructions to Form 10-Q. Accordingly, certain information and footnote disclosures normally included in financial statements prepared in accordance with US GAAP have been condensed or omitted. The accompanying condensed consolidated financial statements include the accounts of the Company and its subsidiaries. All intercompany transactions and balances have been eliminated. ﻿ In the opinion of management, all adjustments considered necessary for the fair presentation of financial position, results of operations and cash flows of the Company have been included. These condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 201 6. The results of operations for the period ended September 30, 2017 are not necessarily indicative of the operating results for the full year. ﻿ Presentation of Foreign Currency Amounts ﻿ The Company’s functional currency is the U.S. dollar (“USD” or “$”). Foreign subsidiaries with a functional currency other than the U.S. dollar translate assets and liabilities at current exchange rates at the end of the reporting periods, while income and expense accounts are translated at average exchange rates for the respective periods. The Company and its subsidiaries enter into various transactions made in currencies different from their functional currencies. These transactions are typically denom inated in the Canadian dollar (“CAD”), Euro (“EUR”), Polish zloty (“PLN”) and British pound (“GBP”). Gains and losses resulting from changes in foreign currency exchange rates related to these transactions are included in income from operations as they occur. ﻿ The exchange rates to the U.S. dollar used to translate balances at the end of the reported periods are as follows: ﻿ ﻿
﻿ |  |  |  |
﻿ |  | September 30, |  | December 31,
﻿Ending Rates |  | 2017 |  | 2016
﻿Canadian dollar (CAD) |  | 1.2480 |  | 1.3427
﻿Euros (EUR) |  | 0.8466 |  | 0.9476
﻿Polish zloty (PLN) |  | 3.6506 |  | 4.2065
﻿British pound (GBP) |  | 0.7466 |  | 0.8106
﻿ The average exchange rates to the U.S. dollar used to translate balances during each reported period are as follows: ﻿
﻿ |  |  |  |  |  |  |  |  |  |  |  |
﻿ |  |  |  |  |  |  |  |  |  |  |  |
﻿ |  | For the three months |  |  |  | For the nine months |  |
﻿ |  | ended September 30, |  |  |  | ended September 30, |  |
﻿Average Rates |  | 2017 |  | 2016 |  | % Change |  | 2017 |  | 2016 |  | % Change
﻿Canadian dollar (CAD) |  | 1.2531 |  | 1.3049 |  | 4.0% |  | 1.3072 |  | 1.3224 |  | 1.1%
﻿Euros (EUR) |  | 0.8512 |  | 0.8965 |  | 5.1% |  | 0.8997 |  | 0.8962 |  | (0.4%)
﻿Polish zloty (PLN) |  | 3.6219 |  | 3.8890 |  | 6.9% |  | 3.8379 |  | 3.9057 |  | 1.7%
﻿British pound (GBP) |  | 0.7641 |  | 0.7619 |  | (0.3%) |  | 0.7845 |  | 0.7194 |  | (9.0%)
﻿Source: Pacific Exchange Rate Service |  |  |  |  |  |  |  |  |  |  |  |
﻿ |  |  |  |  |  |  |  |  |  |  |  |
﻿ ﻿ Correction of Prior Period Balances Subsequent to the issuance of the Company’s Quarterly Report on Form 10-Q for the three and nine month periods ended September 30, 2016, the Company determined that it had erroneously recognized a reduction in pari-mutuel revenue for CBS totaling $0.7 million in its condensed consolidated statement of earnings for the nine months ended September 30, 2016. This error also affected the Company’s income tax expense, net earnings attributable to non-controlling interest and consolidated statements of comprehensive income, equity, cash flows and Note 12 “Segment Information” for the nine months ended September 30, 2016. ﻿ The prior period amounts within the Company’s condensed consolidated financial statements for the nine months ended September 30, 2016 have been revised to reflect the correct balances as presented below. ﻿ ﻿
﻿ |  |  |  |  |  |  |  |  |
﻿Condensed Consolidated Statement of Earnings for the nine months ended September 30, 2016:
﻿Amounts in thousands, except for per share information |  | As Previously Reported |  | Correction |  | As Corrected
﻿Operating Revenue: |  |  |  |  |  |  |  |  |
﻿Other |  | $ | 8,839 |  | $ | 697 |  | $ | 9,536
﻿Gross revenue |  |  | 108,873 |  |  | 697 |  |  | 109,570
﻿Net operating revenue |  |  | 102,257 |  |  | 697 |  |  | 102,954
﻿Earnings from operations |  |  | 11,761 |  |  | 697 |  |  | 12,458
﻿Earnings before income taxes |  |  | 11,341 |  |  | 697 |  |  | 12,038
﻿Income tax expense |  |  | (2,378) |  |  | (181) |  |  | (2,559)
﻿Net earnings |  |  | 8,963 |  |  | 516 |  |  | 9,479
﻿Net earnings attributable to non-controlling interest |  |  | (2,933) |  |  | (129) |  |  | (3,062)
﻿Net earnings attributable to Century Casinos, Inc. shareholders |  |  | 6,030 |  |  | 387 |  |  | 6,417
﻿ |  |  |  |  |  |  |  |  |
﻿Earnings per share attributable to Century Casinos, Inc. shareholders: |  |  |  |  |  |  |  |  |
﻿Basic and Diluted |  | $ | 0.25 |  | $ | 0.01 |  | $ | 0.26
﻿ |  |  |  |  |  |  |  |  |
﻿ ﻿
﻿ |  |  |  |  |  |  |  |  |
﻿Condensed Consolidated Statement of Comprehensive Income for the nine months ended September 30, 2016:
﻿Amounts in thousands |  | As Previously Reported |  | Correction |  | As Corrected
﻿Net earnings |  | $ | 8,963 |  | $ | 516 |  | $ | 9,479
﻿ |  |  |  |  |  |  |  |  |
﻿Other comprehensive income |  |  |  |  |  |  |  |  |
﻿Foreign currency translation adjustments |  |  | 2,841 |  |  | (28) |  |  | 2,813
﻿Other comprehensive income |  |  | 2,841 |  |  | (28) |  |  | 2,813
﻿Comprehensive income |  | $ | 11,804 |  | $ | 488 |  | $ | 12,292
﻿ |  |  |  |  |  |  |  |  |
﻿Comprehensive income attributable to non-controlling interest |  |  |  |  |  |  |  |  |
﻿Net earnings attributable to non-controlling interest |  |  | (2,933) |  |  | (129) |  |  | (3,062)
﻿Foreign currency translation adjustments |  |  | (240) |  |  | 7 |  |  | (233)
﻿Comprehensive income attributable to Century Casinos, Inc. shareholders |  | $ | 8,631 |  | $ | 366 |  | $ | 8,997
﻿ |  |  |  |  |  |  |  |  |
﻿ ﻿
﻿ |  |  |  |  |  |  |  |  |
﻿Condensed Consolidated Statement of Equity for the nine months ended September 30, 2016:
﻿Amounts in thousands |  | As Previously Reported |  | Correction |  | As Corrected
﻿Accumulated other comprehensive income |  |  |  |  |  |  |  |  |
﻿Accumulated other comprehensive income (loss) balance at January 1, 2016 |  | $ | (12,704) |  | $ | 21 |  | $ | (12,683)
﻿Foreign currency translation adjustment |  |  | 2,601 |  |  | (21) |  |  | 2,580
﻿ |  |  |  |  |  |  |  |  |
﻿Retained earnings |  |  |  |  |  |  |  |  |
﻿Retained earnings balance at January 1, 2016 |  |  | 57,558 |  |  | (387) |  |  | 57,171
﻿Net earnings |  |  | 6,030 |  |  | 387 |  |  | 6,417
﻿ |  |  |  |  |  |  |  |  |
﻿Total Century Casinos shareholders' equity |  |  |  |  |  |  |  |  |
﻿Total Century Casinos shareholders' equity balance at January 1, 2016 |  |  | 122,416 |  |  | (366) |  |  | 122,050
﻿Net earnings |  |  | 6,030 |  |  | 387 |  |  | 6,417
﻿Foreign currency translation adjustment |  |  | 2,601 |  |  | (21) |  |  | 2,580
﻿ |  |  |  |  |  |  |  |  |
﻿Non-controlling interest |  |  |  |  |  |  |  |  |
﻿Non-controlling interest balance at January 1, 2016 |  |  | 4,859 |  |  | (122) |  |  | 4,737
﻿Net earnings |  |  | 2,933 |  |  | 129 |  |  | 3,062
﻿Foreign currency translation adjustment |  |  | 240 |  |  | (7) |  |  | 233
﻿ |  |  |  |  |  |  |  |  |
﻿Total equity |  |  |  |  |  |  |  |  |
﻿Total equity balance at January 1, 2016 |  |  | 127,275 |  |  | (488) |  |  | 126,787
﻿Net earnings |  |  | 8,963 |  |  | 516 |  |  | 9,479
﻿Foreign currency translation adjustment |  |  | 2,841 |  |  | (28) |  |  | 2,813
﻿ |  |  |  |  |  |  |  |  |
﻿ ﻿
﻿ |  |  |  |  |  |  |  |  |
﻿Condensed Consolidated Statement of Cash Flows for the nine months ended September 30, 2016:
﻿Amounts in thousands |  | As Previously Reported |  | Correction |  | As Corrected
﻿Cash Flows from Operating Activities: |  |  |  |  |  |  |  |  |
﻿Net earnings |  | $ | 8,963 |  | $ | 516 |  | $ | 9,479
﻿Changes in Operating Assets and Liabilities: |  |  |  |  |  |  |  |  |
﻿Receivables, net |  |  | 64 |  |  | (659) |  |  | (595)
﻿Taxes payable |  |  | 63 |  |  | 171 |  |  | 234
﻿Net cash provided by operating activities |  |  | 15,558 |  |  | 28 |  |  | 15,586
﻿Effect of Exchange Rate Changes on Cash |  |  | (885) |  |  | (28) |  |  | (913)
﻿ |  |  |  |  |  |  |  |  |
﻿ ﻿ ﻿ ﻿ ﻿ ﻿ ﻿ ﻿ ﻿ ﻿ ﻿ ﻿ ﻿ ﻿
﻿ |  |  |  |  |  |  |  |  |
﻿Note 12: Segment Information for the nine months ended September 30, 2016:
﻿Amounts in thousands |  | As Previously Reported |  | Correction |  | As Corrected
﻿Canada |  |  |  |  |  |  |  |  |
﻿Net operating revenue |  | $ | 37,470 |  | $ | 697 |  | $ | 38,167
﻿Net earnings attributable to Century Casinos, Inc. shareholders |  |  | 5,076 |  |  | 387 |  |  | 5,463
﻿Income taxes |  |  | 1,477 |  |  | 181 |  |  | 1,658
﻿Non-controlling interest |  |  | 1,918 |  |  | 129 |  |  | 2,047
﻿Adjusted EBITDA |  |  | 11,316 |  |  | 697 |  |  | 12,013
﻿ |  |  |  |  |  |  |  |  |
﻿ Consolidated results in Note 12 “Segment Information” for the nine months ended September 30, 2016 have been updated as presented in the condensed consolidated statement of earnings table above. Consolidated Adjusted EBITDA for the nine months ended September 30, 2016 was corrected by $0.7 million, adjusting the previously reported Consolidated Adjusted EBITDA of $18.7 million to $19.4 million.

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