Red Rock Resorts(RRR) - 2025 Q2 - Quarterly Report

Part I. Financial Information Financial Statements Red Rock Resorts, Inc.'s unaudited condensed consolidated financial statements for periods ended June 30, 2025, are presented, detailing balance sheets, income, equity, and cash flows Condensed Consolidated Balance Sheets The balance sheet reflects a slight decrease in total assets as of June 30, 2025, with stable liabilities and a decline in cash and cash equivalents Condensed Consolidated Balance Sheet Highlights (in thousands) | Account | June 30, 2025 (unaudited) | December 31, 2024 | | :--- | :--- | :--- | | Assets | | | | Cash and cash equivalents | $145,201 | $164,383 | | Total current assets | $286,892 | $295,364 | | Property and equipment, net | $2,841,613 | $2,781,915 | | Total assets | $4,032,442 | $4,045,531 | | Liabilities & Equity | | | | Total current liabilities | $322,401 | $325,202 | | Long-term debt, less current portion | $3,349,294 | $3,354,567 | | Total liabilities | $3,735,388 | $3,738,698 | | Total stockholders' equity | $297,054 | $306,833 | Condensed Consolidated Statements of Income Net revenues and net income attributable to Red Rock Resorts, Inc. significantly increased for both the second quarter and six-month period ended June 30, 2025 Q2 2025 vs Q2 2024 Performance (in thousands, except per share data) | Metric | Q2 2025 | Q2 2024 | | :--- | :--- | :--- | | Net Revenues | $526,273 | $486,403 | | Operating Income | $168,028 | $140,234 | | Net Income | $108,253 | $69,810 | | Net Income Attributable to Red Rock | $56,404 | $35,676 | | Diluted EPS (Class A) | $0.95 | $0.59 | Six Months 2025 vs 2024 Performance (in thousands, except per share data) | Metric | Six Months 2025 | Six Months 2024 | | :--- | :--- | :--- | | Net Revenues | $1,024,134 | $975,300 | | Operating Income | $322,381 | $295,758 | | Net Income | $194,203 | $148,181 | | Net Income Attributable to Red Rock | $101,153 | $78,511 | | Diluted EPS (Class A) | $1.69 | $1.29 | Condensed Consolidated Statements of Stockholders' Equity Total stockholders' equity decreased as of June 30, 2025, influenced by net income, dividends, distributions, and stock repurchases - For the six months ended June 30, 2025, the company paid dividends of $89.6 million and repurchased $30.9 million of Class A common stock[14] - In May 2025, the company declared a special cash dividend of $1.00 per share of Class A common stock[57] Condensed Consolidated Statements of Cash Flows Net cash provided by operating activities for the six months ended June 30, 2025, was offset by significant cash used in investing and financing activities Cash Flow Summary (in thousands) | Activity | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | | Net cash provided by operating activities | $284,667 | $269,003 | | Net cash used in investing activities | ($72,461) | ($185,072) | | Net cash used in financing activities | ($231,388) | ($85,068) | | Decrease in cash and cash equivalents | ($19,182) | ($1,137) | - Investing activities included $146.4 million in capital expenditures and proceeds of $110.5 million from the repayment of Native American development costs[16] Notes to Condensed Consolidated Financial Statements (unaudited) The notes provide critical context to the financial statements, detailing accounting policies, the North Fork development project, long-term debt, share-based compensation, and segment reporting - The company has development and management agreements for the North Fork Project in California. In Q2 2025, the company recognized a $10.0 million cumulative development fee and an $8.5 million gain after receiving a $110.5 million repayment on advances[34][36] - Total long-term debt stood at $3.4 billion as of June 30, 2025, primarily consisting of a Term Loan B Facility and several series of Senior Notes[40] - The company's operations are aggregated into two reportable segments: Las Vegas operations and Native American development. Las Vegas operations generated $513.3 million in net revenues and $239.4 million in Adjusted EBITDA in Q2 2025[78][80] - The company extended its $600 million equity repurchase program through December 31, 2025. As of June 30, 2025, $278.1 million remained authorized for repurchase[60] Management's Discussion and Analysis of Financial Condition and Results of Operations Management discusses the financial results for Q2 and H1 2025, highlighting revenue growth driven by casino performance and the North Fork Project, alongside solid liquidity and capital resource management Results of Operations Net revenues and operating income significantly increased in Q2 2025, primarily driven by strong casino performance and a development fee from the North Fork Project Q2 2025 vs Q2 2024 Revenue Breakdown (in thousands) | Revenue Source | Q2 2025 | Q2 2024 | % Change | | :--- | :--- | :--- | :--- | | Casino | $344,796 | $319,629 | 7.9% | | Food and beverage | $94,374 | $91,718 | 2.9% | | Room | $51,187 | $50,142 | 2.1% | | Development fees | $10,008 | $— | n/m | | Net revenues | $526,273 | $486,403 | 8.2% | - Casino revenue growth in Q2 2025 was driven by a 5.8% increase in slot handle and a 3.9% increase in table games hold percentage compared to the prior year period[113] - A $10.0 million cumulative development fee was recognized in Q2 2025 related to the North Fork Project after financing for the project was secured[116] - A gain of $8.5 million on Native American development was recognized in Q2 2025, representing the excess of proceeds received over the carrying amount of reimbursable advances for the North Fork Project[124] Adjusted EBITDA Adjusted EBITDA, a key non-GAAP performance measure, increased in Q2 2025, primarily driven by contributions from Las Vegas operations and Native American development Adjusted EBITDA Reconciliation (in thousands) | Line Item | Q2 2025 | Q2 2024 | | :--- | :--- | :--- | | Net income | $108,253 | $69,810 | | Adjustments (Depreciation, Interest, etc.) | $121,106 | $131,847 | | Adjusted EBITDA | $229,359 | $201,657 | Adjusted EBITDA by Segment (in thousands) | Segment | Q2 2025 | Q2 2024 | | :--- | :--- | :--- | | Las Vegas operations | $239,444 | $223,147 | | Native American development | $10,008 | $— | | Corporate and other | ($20,093) | ($21,490) | | Total Adjusted EBITDA | $229,359 | $201,657 | Liquidity and Capital Resources The company maintains a strong liquidity position as of June 30, 2025, with sufficient cash and credit availability to fund operations, debt service, and shareholder returns - As of June 30, 2025, the company had $145.2 million in cash and cash equivalents and $897.4 million available under its Revolving Credit Facility[136] - Anticipated capital expenditures for the remainder of 2025 are approximately $180 million to $230 million[137] - The company has a completion guaranty for the North Fork Project, capped at a commitment of $425 million, but management believes it is not probable that funding will be necessary[139] - The equity repurchase program was extended to December 31, 2025, with $278.1 million remaining authorized for repurchases as of June 30, 2025[140] Quantitative and Qualitative Disclosures About Market Risk The company's primary market risk is interest rate fluctuations on its long-term debt, managed through interest rate collar agreements, with no material changes since year-end 2024 - The company's main market risk is interest rate risk from its long-term debt. It uses interest rate collars to manage this exposure[160] Controls and Procedures Management concluded that disclosure controls and procedures were effective as of June 30, 2025, with no material changes to internal control over financial reporting during the quarter - Management concluded that as of June 30, 2025, the company's disclosure controls and procedures were effective at a reasonable assurance level[161] - No material changes were made to the company's internal control over financial reporting during the most recent fiscal quarter[162] Part II. Other Information Legal Proceedings The company is involved in various routine lawsuits, none of which are expected to have a material impact on its financial condition or operations - The company is a defendant in various routine lawsuits but does not expect them to have a material impact[163] Risk Factors No material changes to the company's risk factors have been reported since the Annual Report on Form 10-K for the year ended December 31, 2024 - No material changes to risk factors were reported since the last Annual Report on Form 10-K[164] Unregistered Sales of Equity Securities and Use of Proceeds During Q2 2025, the company repurchased Class A common stock, with a significant amount remaining authorized under its equity repurchase program Issuer Purchases of Equity Securities (Q2 2025) | Period | Total Shares Purchased | Average Price Paid per Share | Dollar Value Remaining in Program | | :--- | :--- | :--- | :--- | | April 2025 | — | $— | $308,970,496 | | May 2025 | 671,677 | $45.92 | $278,115,032 | | June 2025 | — | $— | $278,115,032 | | Total | 671,677 | $45.92 | $278,115,032 | Defaults Upon Senior Securities The company reported no defaults upon senior securities - None[169] Mine Safety Disclosures The company reported no mine safety disclosures - None[169] Other Information No directors or executive officers adopted, terminated, or modified Rule 10b5-1 or non-Rule 10b5-1 trading arrangements during Q2 2025 - None of the Company's directors or executive officers adopted, terminated or modified a Rule 10b5-1 trading arrangement during Q2 2025[169] Exhibits This section lists the exhibits filed with the report, including Sarbanes-Oxley Act certifications and XBRL data files