UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D. C.
20549
FORM 10-Q
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Quarterly report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 | ||
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| For the quarterly period ended March 31, 2003 | |||
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Transition report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 | ||
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| For the transition period from ________to________ | |||
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| Commission file number 0-14050 | |||
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| THE SANDS REGENT | |||
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| (exact name of registrant as specified in charter) | |||
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| Nevada |
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88-0201135 | |
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| (State or other jurisdiction of incorporation or organization) |
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(I.R.S. Employer Identification No.) | |
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| 345 North Arlington Avenue, Reno, Nevada |
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89501 | |
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| (Address of principal executive offices) |
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(Zip code) | |
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| Registrant’s telephone number, including area code (775) 348-2200 | |||
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.
| Yes x |
No o |
Indicate by check mark whether the registrant is an accelerated filer (as defined in Rule 126-2 of the Exchange Act).
| Yes o |
No x |
On May 14, 2003, the registrant had outstanding 4,941,805 shares of its common stock, $.10 par value.
THE SANDS REGENT AND SUBSIDIARIES
FORM 10-Q
TABLE OF CONTENTS
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Page No. |
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| PART I |
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| Item 1. |
1-3 | |
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1 | |
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2 | |
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3 | |
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Condensed Notes to Interim Consolidated Financial Statements (unaudited) |
4-6 |
| Item 2. |
Management’s Discussion and Analysis of Financial Condition and Results of Operations. |
7-11 |
| Item 3. |
12 | |
| Item 4. |
12 | |
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| PART II |
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| Item 1. |
13 | |
| Item 2. |
13 | |
| Item 3. |
13 | |
| Item 4. |
13 | |
| Item 5. |
13 | |
| Item 6. |
13 | |
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| 14 | ||
| 15-17 | ||
THE SANDS REGENT AND SUBSIDIARIES
PART I
FINANCIAL INFORMATION
CONSOLIDATED STATEMENTS OF OPERATIONS (unaudited)
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THREE MONTHS ENDED MARCH 31, |
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NINE MONTHS ENDED MARCH 31, |
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| (Dollars in thousands except per share amounts) |
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2002 |
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2003 |
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2002 |
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2003 |
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| Operating revenues |
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| Gaming |
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$ |
5,248 |
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$ |
6,421 |
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$ |
15,376 |
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$ |
20,242 |
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| Lodging |
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1,485 |
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1,672 |
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5,934 |
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6,555 |
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| Food and beverage |
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1,316 |
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1,628 |
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4,063 |
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5,349 |
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| Fuel and convenience store |
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— |
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3,851 |
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— |
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10,907 |
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| Other |
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352 |
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317 |
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1,061 |
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1,123 |
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8,401 |
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13,889 |
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26,434 |
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44,175 |
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| Less promotional allowances |
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850 |
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901 |
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2,366 |
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2,720 |
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| Net revenues |
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7,551 |
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12,988 |
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24,068 |
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41,456 |
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| Operating expenses |
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| Gaming |
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2,585 |
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2,944 |
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7,628 |
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8,867 |
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| Lodging |
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934 |
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902 |
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2,970 |
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3,168 |
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| Food and beverage |
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771 |
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1,058 |
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2,418 |
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3,329 |
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| Fuel and convenience store |
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— |
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3,647 |
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— |
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10,333 |
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| Other |
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135 |
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134 |
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434 |
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421 |
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| Maintenance and utilities |
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905 |
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995 |
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2,599 |
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3,157 |
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| General and administrative |
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1,621 |
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2,236 |
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5,170 |
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6,864 |
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| Depreciation and amortization |
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754 |
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878 |
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2,316 |
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2,638 |
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7,705 |
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12,794 |
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23,535 |
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38,777 |
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| Income (loss) from operations |
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(154 |
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194 |
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533 |
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2,679 |
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| Other income (expense) |
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| Interest and other income |
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25 |
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3 |
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156 |
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7 |
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| Interest expense |
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(270 |
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(290 |
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(843 |
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(958 |
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| Gain (loss) on disposal of property and equipment, and abandonment of new project |
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(183 |
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— |
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(119 |
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(146 |
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| Gain on sale of subsidiaries |
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— |
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205 |
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— |
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205 |
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(428 |
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(82 |
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(806 |
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(892 |
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| Income (loss) before income taxes |
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(582 |
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112 |
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(273 |
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1,787 |
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| Income tax (provision) benefit |
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203 |
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(35 |
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110 |
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(610 |
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| Net income (loss) |
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(379 |
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77 |
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(163 |
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1,177 |
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| Net income (loss) per share |
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| Basic |
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$ |
(0.08 |
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$ |
0.02 |
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$ |
(0.04 |
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$ |
0.24 |
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| Diluted |
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(0.08 |
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0.01 |
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(0.04 |
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0.23 |
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| Weighted average of shares outstanding |
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| Basic |
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4,525,722 |
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4,935,003 |
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4,525,722 |
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4,930,584 |
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| Diluted |
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4,525,722 |
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5,254,912 |
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4,525,722 |
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5,214,903 |
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The accompanying notes are an integral part of these unaudited consolidated financial statements.
1
THE SANDS REGENT AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS (unaudited)
| (Dollars in thousands) |
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JUNE 30, |
|
MARCH 31, |
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| ASSETS |
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| Current assets |
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| Cash and cash equivalents |
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$ |
5,628 |
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$ |
3,930 |
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| Short-term investments |
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20 |
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20 |
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| Accounts receivable, net of allowance |
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517 |
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464 |
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| Note receivable, sale of subsidiaries |
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180 |
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— |
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| Inventories |
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716 |
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651 |
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| Federal income tax refund receivable |
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369 |
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— |
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| Prepaid expenses and other assets |
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1,253 |
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1,083 |
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| Total current assets |
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8,683 |
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6,148 |
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| Property and equipment |
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| Land |
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8,506 |
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8,506 |
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| Buildings and improvements |
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40,148 |
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40,839 |
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| Equipment, furniture and fixtures |
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20,345 |
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20,004 |
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| Construction in progress |
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346 |
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285 |
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69,345 |
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69,634 |
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| Less accumulated depreciation and amortization |
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31,811 |
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33,817 |
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| Property and equipment, net |
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37,534 |
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35,817 |
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| Other assets |
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| Note receivable, sale of subsidiaries, net |
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144 |
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— |
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| Goodwill |
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10,950 |
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11,018 |
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| Other intangibles |
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1,356 |
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1,356 |
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| Other |
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477 |
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381 |
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| Total other assets |
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12,927 |
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12,755 |
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| Total assets |
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$ |
59,144 |
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$ |
54,720 |
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| LIABILITIES AND STOCKHOLDERS’ EQUITY |
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| Current liabilities |
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| Accounts payable |
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$ |
3,154 |
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$ |
1,750 |
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| Accrued salaries, wages and benefits |
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997 |
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1,531 |
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| Other accrued expenses |
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241 |
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|
218 |
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| Federal income tax payable |
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— |
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106 |
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| Deferred federal income tax liability |
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222 |
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220 |
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| Current maturities of long-term debt |
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849 |
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