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spk05: Ladies and gentlemen, good day and welcome to the Full House Resorts Second Quarter Earnings Call. Today's conference is being recorded. At this time, I would like to turn the conference over to Luis Fanger, Chief Financial Officer of Full House Resorts. You may begin.
spk03: Thank you and good afternoon, everyone. Welcome to our second quarter earnings call. As always, before we begin, we remind you that today's conference call may contain forward-looking statements that we're making under the safe harbor provision of federal security laws. I would also like to remind you that the company's actual results could differ materially from the anticipated results in these forward-looking statements. Please see today's press release under the caption forward-looking statements for the discussion of risks that may affect our results. Also, we may make reference to non-GAAP measures such as adjusted EBITDA. For a reconciliation of those measures, please see our website as well as the various press releases that we issue. And lastly, we're also broadcasting this conference call at FullHouseResorts.com where you can find today's earnings release as well as all of our SEC filings. And with that said, I'll be really brief and then turn it over to Dan, but this was another very strong quarter and a great first half of the year. Adjusted EBITDA for the second quarter was $14.9 million. This is now our fourth straight quarter of very strong results. The reasons behind it, you've heard over the last several calls and they haven't changed. But the short story is we've revamped our cost structure in part by investing in new slot marketing systems and other technology. And we continue to think that these changes are sustainable in the long run. And so when you look at adjusted EBITDA for the first half of 2021, that number sits a little north of $25 million. And if you look at the last four quarters, we're just shy of $48 million of annual or annualized, I should say, adjusted EBITDA. The one segment that is a little slower and rebounding from the COVID shutdowns last year was our Nevada segment. It feels like we crossed that bridge in the second quarter with guests returning to the Hyatt complex that houses our Grand Lodge Casino and visitation to Fallon's Naval Air Station also starting to return. With regards to our sports skins, we had two more launched during the second quarter. That brings us up to five skins that are now live out of a total of six. Those five skins represent $6 million of annualized contractual revenue. The last remaining sports skin is with Smarkets, and it feels like they should be launching very soon in Indiana. The Gaming Commission, of course, has to thoroughly vet any company before it can launch in the state, but it does feel like we're on the homestretch there. When that last skin launches, it will add another $1 million of annualized contractual revenue, giving us a total of $7 million per year from our sports skins. And then the last point I just wanted to make was on our cash position. That continues to be in very good shape. Sitting here in real time, we have about $283 million of cash and restricted cash. A little more than $176 million of that is reserved for the construction of Chamonix. Of course, we'll start to use some of that cash balance as construction on Chamonix continues to ramp up. But do remember also that outside of that project capex, our business generates some pretty meaningful cash flow. I know Dan's going to have a lot more bigger points for you, so I'll turn it over to you, Dan.
spk02: Well, this is one of those quarters where the accounting professional likes to confuse things because they kind of force us to do all these comparisons of the second quarter of 2021 and the second quarter of 2020. And of course, we were closed for most of 2020, so it's a completely bullshit comparison, which is why we earned their ire by including the 2019 numbers in the supplemental information, which is kind of halfway through the press release, because we think that's a far more interesting comparison, because everything was open for the full quarter in 2019. And if you look at that, in Mississippi, we had adjusted EBITDA of almost $9 million. That's the best second quarter, I think, in the property's history. 2019, it was $3.6 million, so it was twice what we did before COVID came around. I'm going to put you closer to the mic. Okay. In Indiana, we did $2.7 million of adjusted EBITDA before the pandemic. The second quarter in 2019 was $600 million. That $2.7 million is the best second quarter there for quite some time. In Colorado, we did $1.8 million versus $876,000 in 2019. Again, a very strong quarter. May have been the strongest second quarter in the 20-year history of Bronco Billy, 25-year history. And then in northern Nevada, which had kind of lagged in prior quarters, but we had a really good Second quarter there was $1.4 million of adjusted EBITDA versus $400,000. And, of course, we had the contracted sports wagering income of $1.5 million, which we didn't have any of that back in 2019. And so the adjusted segment EBITDA is $16.4 million. Corporate's $1.5 million, and that left us with $14.9 million. And back in 2019, it was $5.5 million, and corporate was $1.2 million. Much of the increase in corporate is we have a bonus plan and different compensation plans that are based on income. And so when the income improves this much, we have to take accruals on the assumption that there will be nice bonuses at year end. And so that's the story of the quarter. It was great. And we earned about as much in the quarter as we did in the full year of 2019. we intend to keep this going. Part of that is the slot system, which Louis mentioned, the Konami system we had put into Colorado and Rising Sun two years ago now almost. We're going to be putting that into northern Nevada in the fourth quarter. At that point, we'll have the state-of-the-art slot system throughout the company. That allows us to do things that are a better experience for the customer, but we also get much greater marketing data that allows us to be more efficient on our marketing. And that's been part of the reason for our success. In Colorado, Chamonix is starting to take shape. The webcams are available at chamonixco.com, chamonixcolorado.com. And we're rocking and rolling. Put up a big tower crane that's 230 feet tall with a 200-foot arm on it so it can reach everywhere at this kind of extended property we're doing. and the foundations are going in, pilings are in, where the elevators go is where the shear walls around the elevators are all going in. It's still very early in it. It's a topsy-turvy world to try to build something, as you can imagine, like price of lumber shut way up, and then it crashed way down, and it's unclear what the tariffs are going to be with the stuff from China and so on. You know, our budget's 180 million. We're planning to be open in the fourth quarter of 2022. Make sure I get it right. You know, there are some challenges in that. We think we're pushing a little bit on that fourth quarter. We'll know better in the months ahead. But it could slip into the first quarter of 2023, but we're striving for the fourth quarter of 2022. The 180, if I were to guess at this point, because we put out to bid a pretty small part of the project at this point, but the bids have come back a little higher than we thought, so there's some pressure there. We'll know again better as we put more of it out to bid, but it's probably pushing 200 or somewhere in there. We are evaluating... not only trying to get a better number because we're putting out bid packages so we get smarter just about every week, but it looks like one of our competitors opened a 100-room hotel. It seems to be pretty booked up. It's a pretty kind of a Motel 5 hotel, but nevertheless it's doing pretty well. And the bigger new hotel up in Black Hawk that Monarch built seems to be doing pretty well. I went and visited it, and they did a nice job. They're constrained by their footprint, which is long and narrow. Nevertheless, they seem to be doing well. But I think there are a number of ways where we will have the best casino in the state because we don't have some of the constraints that the places have in Black Hawk. And so we are evaluating whether to add another 70 rooms and suites to it. We had always had this idea that we could add another leg at some future date, and we're evaluating whether to do it now. Part of that is to get a firmer grasp on where we are versus that $180 million. I don't want to increase the scope of it if we're not having the costs contained. But we also would need approval of the city's historical preservation committee and city council in order to increase the project to 370 rooms. Now, Monarch, I think, is 500 rooms. And Ameristar and Black Hawk is 534 rooms, if I remember correctly. So as we go up in size, we can't go tall, because we're in a historical area. So we're kind of sprawling out. Fortunately, we have quite a few acres, so we can sprawl out. Not too long ago, just checking out other nice hotels in the state, I stayed at the St. Regis in Aspen, which is a very nice hotel in Aspen. It gets a really high room rate and everything else. It's balls. You can't go tall in Aspen either, and yet it feels very nice. And frankly, that's roughly comparable to the size of what we're building. So if you want to feel what it feels like... St. Regis and Aspen is similar to what we're kind of building in terms of guest room wings that stretch out that are four, five, and six floors tall. And so we'll make a decision in the next couple months on whether to go to city council and get those approvals and get our board approval and so on. But pretty good chance we'll try to upsize the scope of this because the market seems to be there for it, and we have the money. Frankly, we have more than enough money even for the expanded project. Down at the Silver Slipper, we also achieved something pretty remarkable. Silver Slipper is on a pretty constrained little piece of land, and we've been trying to figure out how do we add another hotel tower someday. finally concluded the best way to do it was to build out over the water out over the Gulf of Mexico. Everything is built on pilings down there anyway because it's muddy Mississippi. If you don't put it on pilings, it's going to sink. So if you build that over the water, the pilot driver is on a barge instead of on a truck. That's conceptually the same thing. You still have to have the livable space, something like 25 feet above sea level for storm surges from hurricanes and all that sort of thing. The Bottom of the Gulf of Mexico belongs to the state of Mississippi for the first X miles going offshore. And so to build that over the water, we needed to reach an agreement to lease land from the state of Mississippi. They won't sell it, so you end up leasing it. And so we have an option to lease. If we exercise that option, we can lease it for up to 60 years. Once it's open, the rent's about $100,000 a year. The option payments before that are pretty minor. Obviously, the state of Mississippi would like to see us do this. They get gaming tax revenue in our casino. If we have more rooms, we'll have more casino revenue, more jobs, more development, and all that. And so the governor signed that within the last month, and so we now have a firm option to lease a half acre of the bottom of the Gulf of Mexico, as oddly as that sounds, to allow us to build a hotel tower that would be ideally located vis-a-vis our casino. We still require some environmental approvals. We do have an option on some land that we think is environmentally sensitive, so we can do a swap so that we can fill in some of the marshland that's next to us to create parking that would be needed by having more hotel rooms. And so we still have to work that out. And meanwhile, we're looking over our shoulders at the casino being proposed in Slidell, which I think has gotten perhaps too much visibility versus our company. We were a little surprised that they got through the legislature. They just barely got through the legislature. And they did it with, there was one committee where a guy was gonna abstain, and he changed his vote to vote for it. Well, his wife was one of the 19 lobbyists that the casino proponent had hired, so that's pretty questionable. But they go to a local referendum on November 13th. We've been doing polls. The polling that we've done, and it's not push polling, it's an honest poll, shows it loses. by a pretty wide margin. This is a very conservative region, heavily Republican. People move there from New Orleans to get away from urban issues, and so they don't want things like casinos. But even if, and by the way, the sheriff, the head of police, and the mayor's the two biggest towns have all come out against it. Even if it wins, What is being proposed is relatively minor compared to all the casinos that are around. And casinos like us in Mississippi have a tax rate that's half of what it is in Louisiana. And so it's reminiscent of when Peninsula built a casino in Rochester, New York, kind of ignoring the existing competition that had a lower tax rate, and that property ran into trouble immediately. or the other one I'd point out is the M Resort that was built on the south side of Las Vegas. They go, oh, we're going to catch people before they get to the Strip. But it wasn't big enough and important enough to get people to stop before they got to the Strip. And so people continued to drive further to better places. And, of course, the M Resort failed shortly after it opened. You know, we compete already with a number of casinos. Probably our... most vibrant competitors, a place called Island View. It's a private company out of Gulfport. And they've got over 1,000 guest rooms and a lazy river swimming pool and a couple of casinos. And frankly, it's a nice place. And you have to drive past us to get to it. And they do quite well, and we manage to do well as well. The Hollywood casino is quite close to us. They have three times the guest rooms that we have. And they do well. We do well. We compete with the places in Biloxi, and there are a whole 10 of them over there. We compete with the fairgrounds, which if you leave Slidell and head to us, you do not go by the new proposed casino site. But if you're going from Slidell to New Orleans, the closest casino to Slidell is actually Fairgrounds, which is owned by Churchill Downs, and you do pass that casino site going to New Orleans. And so we compete with fairgrounds. We compete with New Orleans. The Harris property in New Orleans cost $900 million when it was built 20 years ago. They're in the process of putting another $500 million into it. That's the 700-pound gorilla in the region. And they're not going away. And then we compete with the casinos in Baton Rouge, including LaBear's, which in an earlier life I designed and And it's a good property on the south side of Baton Rouge. And there's two other properties in Baton Rouge, plus a tribal casino on the northwest side of Baton Rouge. So, you know, adding one more casino to that mix is, you know, is it a plus? No, it's not a plus, but it's not a very big negative to us. And I think we'll do just fine. And, of course, we'll know pretty certainly here in a couple of months whether whether it's going to happen at all. Meanwhile, in Waukegan, the Gaming Commission, who, you know, the law actually said they were supposed to choose somebody by late last year, but they had an out because of COVID, and so they didn't. Now they've hired a consultant to help them, an experienced consultant in the casino industry on this stuff, and... and the head of the Illinois Gaming Board had indicated that once they had a consultant, they thought they would be six months from a decision. And so that would imply that somewhere perhaps in the fourth quarter, we and the other two proposals for Waukegan get to make a presentation to the Illinois Gaming Commission and Illinois Gaming Board, I guess it is, and hopefully they come to a decision thereafter. And the way this normally works is you then negotiate a development agreement with the gaming board and you have certain timelines that you have to meet and certain milestones and then you're off to the races and you build it as quickly as possible. We were deemed by the city's consultant as having the best proposal. We simply had the smallest balance sheet relative to what we were proposing I think we fixed that over the past year, and we're now sitting in pretty good shape for what we've proposed. Obviously, we'd have to arrange financing, but I don't think there's any question that we could. We also have a private equity firm that has signed up to step in, although, frankly, with where bonds are trading, it might be cheaper to do it directly. And we've been working on our proposal in terms of the details of it. The city process was very quick, and you had to put something together very fast, which we did. And now we're kind of enhancing that more to put a little more meat on those bones so that when we show it to the Illinois Gaming Board, it'll be the most thought-out, most thoughtful proposal they've seen, I believe. Meanwhile, in Indiana... About three or four years ago, we had proposed building a casino in Terre Haute. That's an area with about 150,000 people. It is about an hour from Indianapolis on the west side of Indianapolis, which is a city of two million people. There are two casinos that cater to Indianapolis. They're both east of Indianapolis, and they're outside of town a little bit. It's a pretty good market, we think. Terre Haute itself, plus you could probably draw some from Indianapolis. And there's a whole bunch of towns in that region that are 100,000 to 200,000 people, you know, Champaign-Urbana, Lafayette, Indiana, and so on, that don't have casinos and might also be attracted to a place in Terre Haute. The Indiana Gaming Commission had selected... a partnership to develop in Terre Haute. It wasn't us. But as I mentioned before, you end up with milestones and timelines, and that developer did not meet those milestones. And so they didn't renew his approval, and instead they've now put out a request for proposals for other people to potentially develop in Terre Haute And we're looking very carefully at that. Deadline is middle of September, and we'll see where that goes. I think that's it, Lewis. Did I miss anything? I think we're good, Dan. Yeah. Want to do some questions? I didn't tell them about our proposal to acquire Winn, but we'll leave that for another day. And that's a joke. Winn is 20 times our size. Let's take some questions. Maybe 50 times our size.
spk05: Thank you. Ladies and gentlemen, if you would like to ask a question, please signal by pressing star 1 on your telephone keypad. If you are using a speakerphone, please make sure your mute function is turned off to allow your signal to reach our equipment. Once again, please press star 1 to ask a question. We'll pause for just a moment to allow everyone an opportunity to signal. We'll take our first question from Ryan Sigdal from Craig Hellam Capital Group. Your line is open. Please state your question.
spk04: Good afternoon, Dan Lewis. Congrats on the record results. Thank you. Thank you. Curious trends into July, both revenue as well as margins and just kind of visibility and expectations, I guess, on what you're seeing on the casino side.
spk03: I'll tell you generally, we continue to be pretty pleased with the business. I'll let you read into that however you will. Last year was obviously a very, very strong year as we reopened. Look, it continues to be good is maybe the best thing to tell you. That's a very short way of answering you.
spk04: No, that's good.
spk02: Just be aware that we were fully open in the third quarter last year, so the percentage increases will not be nearly as big as they were second quarter to second quarter.
spk04: Absolutely true. Fair enough. Here's on the tech side. You mentioned rolling out the slot system in Nevada. Any opportunity or thoughts around rolling that across the whole portfolio of properties?
spk02: No, we've actually done that. We've had it in Mississippi for years, so we're pretty familiar with it, although Konami every year or two has an upgrade and makes it better and better. They even have down the road the ability for that machine, almost like your iPhone, to recognize your face, and so you won't need a card anymore. You can just sit at a machine and play, and then if you go somewhere else, your points and credits will go to the other machine. So that's not rolled out yet, but it's pretty interesting, some of the stuff they're working on. So we had it in Mississippi. It was a pretty big investment for us to install it in Indiana and Colorado, which we did a year and a half ago, and that we had just put it in when the COVID forced us to close everything. Well, that actually gave us an opportunity to really get up to speed on what the system was and how to use it. And that's been part of the uptick in those two properties. So now the only part of the company that doesn't have it is Northern Nevada, and we're going to put that in the fourth quarter.
spk04: Helpful. I knew the Indiana and Colorado. I wasn't aware the same system was also in Mississippi.
spk02: What about cashless tech? It's a big deal. You've got to open every single slot machine and change a circuit board inside of it, tie it into a server of some sort. It sounds easy to say, well, we're going to put up this slot system, and it's not. It's a big process.
spk04: Yep. What about cashless technology rolling out? There's some casinos, resorts, world, et cetera, that are kind of taking an accelerated approach to it. Any thoughts there?
spk02: I'm rooting for them. I've been down to Resorts World and some of the stuff they have. It takes a while for consumers to really link onto it. I remember when MGM opened back in the 1990s, they had a section of their casino where the slot machines did not take coins. It was paperless, and it failed. And then a few years later, IGT came out with the take it in, take it out, which is basically the same system or another variation of the same system. And now nobody has coins. Customers are all accustomed to that. And so I think it eventually will be cashless. And Resorts World is kind of the beta site for some of that. And how wonderful would it be if we could get rid of chips? Because there's a very expensive process of counting the chips and doing all that stuff. And if you could, when you're done gambling at a table, if we can give you a Tito ticket and you go away from the table with a Tito ticket, well, you can redeem it at any of the normal redemption machines or stick it in a slot machine. Whereas if you walk away today with chips from a gaming table headed to the cage, you can't put those in a slot machine. So a lot of this stuff is... coming down the road eventually, and we'll adapt it pretty quickly once it's kind of a proven technology.
spk03: Dan and I go over the pros and cons of these systems all the time, and looking at the resorts, World One in particular, the table game side I think is the more interesting side. When you start looking at the thought side, there are certainly benefits that you get from not having to drop all those slot machines twice a week or whatever it is that you do and reducing the amount of cash that you have just kind of sitting idle on the floors. There's certainly a benefit in that. But if you were to go to that resorts world kind of now and want to play a slot machine, it's unfortunately still easier to put your cash in the slot machine than to load up your e-credits and then sync your phone to the slot machine and go through all that jazz. You know, we're kind of watching all sides of it and watching it very, very closely. Table games is certainly very interesting. Would love to get the full casino on board, but it's still early in that whole process.
spk02: We're not quite there. I mean, at Resorts World, you have to open an account and transfer money to it, and then it's cashless, right? But I think pretty soon you'll be able to walk up to a machine and just Venmo the money from your phone into the machine. And when you're done, it can credit back into your bank account. Now, that's not a technological hurdle. It is a regulatory hurdle. The regulator has to be on board with that. And then some of the fees that are, not to pick on Venmo, but that sort of thing, have fees that with the amount of money that moves in and out in a casino, you can't have a significant fee. But you used to have the same thing. Remember when you used to go to stores and they'd say, well, no credit card transactions less than $10 or something, right? And today you buy a cup of coffee at Starbucks for $2 and you charge it on your credit card. So I think it's evolving and it's a plus. Look, the bigger thing that's out there is you are going to have online gaming. And I think Colorado and Indiana will take it up pretty soon and we're in both of those markets. And the experience in New Jersey and other markets is that that's a very big market, bigger than online sports betting. And so we're watching that. And we also think it will probably come to Illinois pretty quickly. So we're watching that.
spk04: One more for me. Dan, certainly an acquisition of Wynn, you know, it'd be fantastic. But any other M&A opportunities out there? You guys have a lot of girls across, you know, just with Chamonix, Terre Haute, Waukegan. But anything on the M&A side where you can bolt on one or two other regions?
spk02: We look at a lot of stuff, you know, and unfortunately a lot of times when somebody's trying to sell something, it's got hair on it, right? But... But we did, a couple years ago, bought Bronco Billy's, which is now a pretty important part of the company. So we look at all sorts of stuff, but there's nothing to report today. And frankly, from our point of view, if we just execute on what we have, even if it's just Chamonix, forget about Waukegan, forget about Terre Haute, if we just execute on Chamonix, this stock will be a home run. And you've run the numbers and shared them with your customers. And so we, first and foremost, don't want to screw it up. And a lot of times when you're looking at acquisitions, you're like, well, if you buy that at that price and then it turns out to be a dog, you've kind of screwed it up. So we're pretty cautious about that stuff.
spk04: Couldn't agree more. That's it for me. Good luck, guys.
spk02: Okay, thanks.
spk06: Thanks, Ryan.
spk05: We'll take our next question from Chad Bannon from Macquarie. Your line is open. Please go ahead.
spk01: Hi. Hi, good afternoon. Thanks for taking my question. Hey, I wanted to ask about just broad returns on Chamonix. Given the recent strength in the gaming industry and the overall improvement in business models across the country, have you changed your view in terms of what returns you think you can generate at the project? And then also related to that, with the CapEx, how should we think about the cadence of when that's actually flowing through the balance sheet over the next six to eight quarters? Thanks.
spk03: Okay. Let me take the first one. Go ahead. The last one first. Yeah, yeah. Roughly speaking, so for this year, it's going to be somewhere in the ballpark of $50 million of spend. It's probably a little... slightly on the lighter side of that. And then you're going to get another $130 million of spend in the year beyond that in 2022. Depending on the timing, of course, you could see some of that spend slip into 2023. And then you always get a weird game with the payables as we have holdbacks for waiting for work to be finished with the GC's that time it can also push some of those payments into 2023.
spk02: Well, and then, look, based on the, you know, you have all these different bid packages you go out and you compare with where they came in and you end up negotiating on each one and so on. And we're coming in like 10% to 15% above where we thought we'd be in that 180 number. Now, the 180 number includes a $19 million contingency, which is there in part for this, but it's pretty early in the game to be drawing on contingency. And we've also only bid out a small portion of the project. But we're working furiously to kind of bid more of it out and get more of it signed up. If I were to guess at this point, and it's a guess, because at the point where we are more definitive, we would have to put more money into the restricted account and so on. But my guess is it's not 180, it's more closer to 200. And then if we decide to add the other rooms, we probably end up at something like 230, 225, 230. Now on the positive side, we've always been very conservative on what we think we can earn there. We believe Ameristar is making something like $85, $90 million a year of EBDIT with their 534 rooms. By the way, maybe north of that in the post-COVID world, Dan. Yeah, maybe. If you look at the maximum bet limits just went away in the last few months, and the table game play in Blackhawk rose like 50%, right? And Cripple Creek has less decent hotel rooms and so on, but even in Cripple Creek, it was up like 35%. We have very little table game business at Bronco Billy's. We don't have many hotel rooms there, almost none. And our focus has always been slot machines. But Chamonix will do table games. And so it's entirely possible that this place can make $50, $60 million a year on an investment of $230 million. And that's what's driving us to think, well, it's never the most efficient way to add that extra wing is to do it right now when you have the contractor there and everything, and it's kind of easier to say to your electrical subcontractor, you know what, you're already driving up on the hill putting in wiring for this hotel. We're going to add this other wing, so let's figure out what it would cost now. And so it's something we're studying pretty carefully. And I wanted to mention it because if we decide to go ahead and if our board approves it, we would be in front of the Historical Preservation Committee and in front of city council. I think they would look at it favorably, but of course there's never certainty on that. So I wanted to make sure we kind of broadly said, hey, we're looking at this so that we don't end up in a situation where it ends up in a local newspaper our phones start ringing off the hook on what the hell is this? So, you know.
spk03: You know, we've worked on, or I guess Dan specifically has worked on a lot of these projects more than me, but what is this, number 10, 11, Dan? How many have we done? And I will tell you, of the list of projects, this has always been the one where we look at it and beat down the numbers and still get a good return. And when we look at this project, we have long said to ourselves internally, We like the upside from our numbers a lot. We've always thought there was way more upside potential than downside risk for the return profile for this project. So we feel quite, quite good. That's only been made better by watching what appears to be a very, very good showing out of Monarch and Blackhawk, a very good showing out of Wild with their expansion hotel. And I think what a lot of people forget sometimes is Blackhawk is what Cripple Creek is. But Cripple Creek today is what Blackhawk was pre-Ameristar opening, right? We don't have any four- or five-star product. And so when you run around that town, the potential for us to open with a very, very nice product for what is a very good customer base in Colorado Springs, it's almost outsized. We will stand apart in a very big way is maybe the right thing to say.
spk02: Actually, the other data point to be aware of is that $1.8 million of EBIT that we earned in the second quarter at Bronco Billy's. We did that without any parking. The construction has taken up the parking. So we're running valet parking at the curb on Bennett Avenue in front of us and parking the cars three blocks away. We have a self-parked lot as you're coming into town. We're running a shuttle bus from it. And the customers are still coming. And And Bronco Billy's is not exactly Bellagio. I mean, it's a nice, comfortable little place, but its chamonix will be far nicer and significantly bigger. And we will renovate Bronco Billy's as well. But it's pretty amazing the amount of business that gets done in Cripple Creek when you consider the poor quality of what's there. Okay.
spk01: Great. Thanks. And then at Rising Star, you guys posted record, I believe record quarterly revenue, or I'm sorry, record quarterly EBITDA and probably record margins at 25%. Looks like the team is doing a good job there. I believe the tax change still hadn't gone into effect. Can you just confirm that? And then when that does go into effect, how should that flow through to margins in the back half of the year?
spk02: We always have to be careful when we address record numbers at Rising Star because when it first opened back in the mid-1990s, early 1990s, it was the only casino in the region. And it made huge numbers. But this was certainly the best quarter in many years at the property, or several years anyway. And the lower tax rate just started, right?
spk03: Well, it started on July 1st. But because accounting is always fun, what you have to do is you look at what you expect your blended rate will be for the full year. And so you've already effectively seen that average tax rate in the first and second quarters.
spk02: So on a cash basis, it just started. But on an accounting basis, we started in the first quarter.
spk03: That's right. That's right.
spk01: Great. Thanks. Okay. I'll pass the line. Thanks very much, guys. Thanks, Jeff.
spk05: Ladies and gentlemen, once again, please press star 1 to ask a question. That is star 1 on your telephone keypad.
spk06: It appears we have no further questions.
spk02: Please go ahead, speaker. Yeah, I was just going to say it was a great quarter, and our whole team deserves credit for it. Everybody's been working hard, and it's kind of a new attitude that this is the new normal, and trying to maintain this sort of trend while we build out Chamonix and look at these other opportunities to grow the company further. So I'd like to thank everybody for your support, and we'll continue to work hard on your behalf. So thank you.
spk05: That concludes today's conference call. Thank you everyone for your participation. You may now disconnect.
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