Item 7.01. Regulation FD Disclosure.
OnJanuary 23, 2020 ,Station Casinos LLC ("Station Casinos "), whichRed Rock Resorts, Inc. ("RRR") owns a majority indirect interest in and manages, announced that it intends to offer, subject to market and other conditions, approximately$500 million aggregate principal amount of senior notes due 2028 in a private placement pursuant to Rule 144A and Regulation S under the Securities Act of 1933, as amended (the "Offering"). Set forth below is certain information provided to potential investors in the Offering. Recent Developments
Although the results of operations for RRR for the three months ended
• We expect total net revenues of approximately
three months endedDecember 31, 2018 ; • We expect operating income and earnings from joint ventures of
approximately
for the three months endedDecember 31, 2018 ; • We expect Adjusted EBITDA of approximately$133.6 million to
months ended
Adjusted EBITDA margins decreased from approximately 31% to 30% compared
to the three months endedDecember 31, 2018 ; • We expect Palms net revenues of approximately$57.2 million to
($4.0 million ); and • We expectLas Vegas operations, excluding the Palms, net revenues of
approximately
excluding the Palms, Adjusted EBITDA of approximately
EBITDA of
Based on the midpoint of these ranges,
Palms, Adjusted EBITDA margin increased from 32% to 34%.
The following is a quantitative reconciliation of the high and low ends of the above expected range of Adjusted EBITDA to operating income and earnings from joint ventures. We are not providing a quantitative reconciliation of our expectations for Adjusted EBITDA to net income (loss), which is the corresponding GAAP measure, because we do not have information necessary to finalize the calculation of benefit (provision) for income tax, which could have a significant impact on net income (loss) for the three months endedDecember 31, 2019 . Three Months Ended December 31, (amounts in thousands) 2019 2019 2018 (low end of range) (high end of range) Operating income and earnings from joint ventures $ 58,819 $ 62,341$ 72,537 Adjustments: Depreciation and amortization 55,923 59,271 46,864 Share-based compensation 3,884 4,116 2,417 Write-downs and other charges, net(1) 15,006 15,904 13,580 Tax receivable agreement liability adjustment - - (263 ) Adjusted EBITDA $ 133,632 $ 141,632$ 135,135
(1) Primarily relates to Palms redevelopment and preopening expenses, loss on
artist performance agreement terminations at Palms' nightclub and dayclub,
severance, business innovation and technology enhancements.
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The estimates set forth above are based solely on currently available information. RRR has not finalized its financial statement closing process for the three months endedDecember 31, 2019 or the audit of its financial statements for the year endedDecember 31, 2019 . During the course of this process, RRR may identify items that would require it to make adjustments to the expected preliminary operating results described above. As a result, the discussion above constitutes forward-looking statements and, therefore, we caution you that these statements are subject to risks and uncertainties, including possible adjustments to our preliminary operating results and the risk factors highlighted herein and in RRR's public filings. Adjusted EBITDA is non-GAAP measure that is presented solely as a supplemental disclosure. Adjusted EBITDA includes net (loss) income plus depreciation and amortization, share-based compensation, write-downs and other charges, net (including Palms redevelopment and preopening expenses, loss on artist performance agreement terminations at Palms' nightclub and dayclub, severance, business innovation and technology enhancements), tax receivable agreement liability adjustment, interest expense, net, loss on extinguishment/modification of debt, change in fair value of derivative instruments, (benefit) provision for income tax and other. Item 8.01. Other Events.
On
Item 9.01. Financial Statements and Exhibits.
(d) Exhibits: Exhibit No. Description 99.1 Press Release datedJanuary 23, 2020 104 Cover Page Interactive Data File (the cover page XBRL tags are embedded within the inline XBRL document)
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