Golden Entertainment(US:GDEN)2025-08-08 16:29PART I. FINANCIAL INFORMATION This section presents the company's unaudited consolidated financial statements and management's discussion and analysis for the reporting period ITEM 1. FINANCIAL STATEMENTS (Unaudited) This section presents the unaudited consolidated financial statements of Golden Entertainment, Inc. for the periods ended June 30, 2025, and December 31, 2024, including balance sheets, statements of operations, shareholders' equity, and cash flows Consolidated Balance Sheets This statement provides a snapshot of the company's assets, liabilities, and shareholders' equity at specific points in time | Metric (in thousands) | June 30, 2025 | December 31, 2024 | | :-------------------- | :------------ | :---------------- | | Total assets | $1,045,870 | $1,079,906 | | Total liabilities | $602,575 | $605,679 | | Total shareholders' equity | $443,295 | $474,227 | - Total assets decreased by $34,036 thousand (3.15%) from December 31, 2024, to June 30, 2025, primarily due to decreases in cash and cash equivalents, property and equipment, and operating lease right-of-use assets8 - Total shareholders' equity decreased by $30,932 thousand (6.52%) from December 31, 2024, to June 30, 2025, mainly driven by an accumulated deficit increase8 Consolidated Statements of Operations This statement details the company's revenues, expenses, and net income over specific reporting periods | Metric (in thousands) | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :-------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Total revenues | $163,620 | $167,334 | $324,463 | $341,381 | | Total expenses | $151,704 | $153,799 | $301,478 | $247,704 | | Operating income | $11,916 | $13,535 | $22,985 | $93,677 | | Net income | $4,632 | $623 | $7,131 | $42,586 | | Basic EPS | $0.18 | $0.02 | $0.27 | $1.48 | | Diluted EPS | $0.17 | $0.02 | $0.26 | $1.40 | - Net income for the three months ended June 30, 2025, significantly increased to $4,632 thousand from $623 thousand in the prior year, while for the six months, it decreased to $7,131 thousand from $42,586 thousand, primarily due to a large gain on sale of business in the prior year10 - Operating income for the six months ended June 30, 2025, decreased substantially to $22,985 thousand from $93,677 thousand in the prior year, largely influenced by the gain on sale of business in 202410 Consolidated Statements of Shareholders' Equity This statement outlines changes in the company's equity accounts, including common stock, additional paid-in capital, and accumulated deficit | Metric (in thousands) | June 30, 2025 | December 31, 2024 | | :-------------------- | :------------ | :---------------- | | Common Stock | $262 | $265 | | Additional Paid-In Capital | $479,166 | $481,810 | | Accumulated Deficit | $(36,133) | $(7,848) | | Total Shareholders' Equity | $443,295 | $474,227 | - Total shareholders' equity decreased by $30,932 thousand from December 31, 2024, to June 30, 2025, primarily due to share repurchases ($22,253 thousand) and cash dividends paid ($13,267 thousand), partially offset by net income13150 Consolidated Statements of Cash Flows This statement categorizes cash inflows and outflows from operating, investing, and financing activities | Metric (in thousands) | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :-------------------- | :----------------------------- | :----------------------------- | | Net cash provided by operating activities | $45,980 | $47,296 | | Net cash (used in) provided by investing activities | $(25,310) | $162,969 | | Net cash used in financing activities | $(26,087) | $(319,227) | | Change in cash and cash equivalents | $(5,417) | $(108,962) | | Balance, end of period | $52,308 | $88,638 | - Net cash used in investing activities shifted from a $162,969 thousand inflow in 2024 (due to business sale proceeds) to a $25,310 thousand outflow in 2025, reflecting capital expenditures15149 - Net cash used in financing activities significantly decreased by $293,140 thousand (91.8%) in 2025 compared to 2024, primarily due to the redemption of $276.5 million in senior notes in the prior year15150 Condensed Notes to Consolidated Financial Statements This section provides detailed disclosures on the company's business, accounting policies, segment information, debt, equity, and other financial matters Note 1 — Nature of Business and Basis of Presentation This note describes the company's operations, reportable segments, and the basis for financial statement preparation - Golden Entertainment, Inc. operates a diversified entertainment platform with eight casino properties and 72 branded taverns in Nevada20 - The company conducts business through three reportable segments: Nevada Casino Resorts, Nevada Locals Casinos, and Nevada Taverns21 - The company completed the sale of its distributed gaming operations in Nevada on January 10, 2024, for $213.5 million22 - On April 22, 2024, the company acquired two Great American Pub tavern locations for $7.3 million, integrating them into the Nevada Taverns segment23 Note 2 — Divestitures This note details the financial impact and specifics of the company's divested operations - The sale of distributed gaming operations in Nevada on January 10, 2024, resulted in $2.3 million in transaction costs for the six months ended June 30, 202432 | Metric (in thousands) | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :-------------------- | :----------------------------- | :----------------------------- | | Distributed Gaming - Nevada Revenues | $— | $6,019 | | Distributed Gaming - Nevada Pretax income | $— | $476 | Note 3 — Property and Equipment, Net This note provides a breakdown of the company's property and equipment, including depreciation | Metric (in thousands) | June 30, 2025 | December 31, 2024 | | :-------------------- | :------------ | :---------------- | | Property and equipment, net | $731,678 | $750,894 | | Accumulated depreciation | $(513,634) | $(581,165) | - Property and equipment, net, decreased by $19,216 thousand (2.56%) from December 31, 2024, to June 30, 202536 - Depreciation expense for property and equipment was $43.6 million for the six months ended June 30, 2025, comparable to $43.7 million in the prior year period36 Note 4 — Goodwill and Intangible Assets, Net This note details the company's goodwill and intangible assets, including changes due to amortization | Metric (in thousands) | June 30, 2025 | December 31, 2024 | | :-------------------- | :------------ | :---------------- | | Total Goodwill | $86,540 | $86,540 | | Intangible Assets, Net | $52,047 | $53,387 | - Goodwill balances remained unchanged across all segments from December 31, 2024, to June 30, 202539 - Intangible assets, net, decreased by $1,340 thousand (2.51%) from December 31, 2024, to June 30, 2025, primarily due to amortization of player relationships and non-compete agreements41 Note 5 — Accrued Liabilities This note presents a breakdown of the company's accrued liabilities at the reporting dates | Metric (in thousands) | June 30, 2025 | December 31, 2024 | | :-------------------- | :------------ | :---------------- | | Total accrued liabilities | $29,638 | $29,637 | | Gaming liabilities | $11,961 | $11,963 | | Cash dividends payable | $6,540 | $6,641 | - Total accrued liabilities remained relatively stable at $29,638 thousand as of June 30, 2025, compared to December 31, 202442 Note 6 — Long-Term Debt, Net and Finance Leases This note outlines the company's long-term debt structure, finance leases, and associated interest rates | Metric (in thousands) | June 30, 2025 | December 31, 2024 | | :-------------------- | :------------ | :---------------- | | Term Loan B-1 | $392,000 | $394,000 | | Revolving credit facility | $40,000 | $20,000 | | Total long-term debt and finance leases | $436,949 | $417,643 | | Long-term debt, net and finance leases | $423,272 | $405,278 | - Long-term debt, net and finance leases increased by $17,994 thousand (4.44%) from December 31, 2024, to June 30, 2025, primarily due to an increase in revolving credit facility borrowings43 - The weighted-average effective interest rate on the Credit Facility was 6.60% for both the three and six months ended June 30, 202547 - The company redeemed and repaid in full its $375 million 7.625% Senior Notes due 2026 on April 15, 2024, incurring a $4.4 million loss on debt extinguishment48 Note 7 — Shareholders' Equity and Stock Incentive Plans This note details changes in shareholders' equity, including share repurchases, dividends, and stock-based compensation - The company repurchased 788 thousand shares of common stock for $22,253 thousand during the six months ended June 30, 2025, under its $200 million share repurchase program5051 - As of June 30, 2025, $77.2 million remained available under the share repurchase program50 - A recurring quarterly cash dividend of $0.25 per share was declared, with $6,540 thousand paid on July 9, 2025, for the quarter ended June 30, 202553 | Metric (in thousands) | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :-------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Total share-based compensation expense | $2,052 | $2,346 | $4,942 | $5,387 | Note 8 — Income Tax This note provides information on the company's income tax benefit or provision and effective tax rates | Metric (in thousands, except for tax rate) | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :----------------------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Income before income tax benefit (provision) | $4,189 | $479 | $7,759 | $69,935 | | Income tax benefit (provision) | $443 | $144 | $(628) | $(27,349) | | Effective tax rate | (10.6)% | (30.1)% | 8.1% | 39.1% | - The effective income tax rates for the three and six months ended June 30, 2025, were (10.6%) and 8.1%, respectively, differing from the federal rate of 21.0% primarily due to excess tax benefits on option exercises62 - New U.S. tax legislation (OBBBA) was signed into law, making permanent many sunsetting tax provisions from 2017, but the company does not expect a material impact on its financial statements64 Note 9 — Financial Instruments and Fair Value Measurements This note describes the fair value measurements of the company's financial instruments, particularly debt | Debt Type (in thousands) | Carrying Amount (June 30, 2025) | Fair Value (June 30, 2025) | Fair Value Hierarchy | | :----------------------- | :------------------------------ | :------------------------- | :------------------- | | Term Loan B-1 | $392,000 | $393,470 | Level 2 | | Revolving Credit Facility | $40,000 | $39,400 | Level 2 | | Finance lease liabilities | $2,995 | $2,995 | Level 3 | | Notes payable | $1,954 | $1,954 | Level 3 | | Total debt | $436,949 | $437,819 | | - The fair value of Term Loan B-1 and Revolving Credit Facility is based on Level 2 inputs (observable market data), while finance lease liabilities and notes payable are Level 3 (unobservable inputs, estimated at carrying value)67 Note 10 — Commitments and Contingencies This note discloses the company's legal proceedings, claims, and other contingent liabilities - The company is involved in various lawsuits, claims, and legal proceedings in the ordinary course of business, but believes their resolution should not have a material adverse effect on its financial condition70 - Aggregate contingent payments recognized as gaming expenses under participation agreements were $3.9 million for the six months ended June 30, 202469 Note 11 — Segment Information This note presents financial data by the company's reportable operating segments, including revenues and Adjusted EBITDA - The company operates through three reportable segments: Nevada Casino Resorts, Nevada Locals Casinos, and Nevada Taverns71 - Adjusted EBITDA is the primary metric used by the chief operating decision maker to assess segment performance and allocate resources7879 | Segment (in thousands) | Total Revenues (3M Jun 2025) | Adjusted EBITDA (3M Jun 2025) | Adjusted EBITDA Margin (3M Jun 2025) | | :--------------------- | :--------------------------- | :---------------------------- | :----------------------------------- | | Nevada Casino Resorts | $98,196 | $25,970 | 26% | | Nevada Locals Casinos | $38,911 | $18,063 | 46% | | Nevada Taverns | $26,255 | $5,877 | 22% | | Segment (in thousands) | Total Revenues (6M Jun 2025) | Adjusted EBITDA (6M Jun 2025) | Adjusted EBITDA Margin (6M Jun 2025) | | :--------------------- | :--------------------------- | :---------------------------- | :----------------------------------- | | Nevada Casino Resorts | $192,417 | $50,739 | 26% | | Nevada Locals Casinos | $77,742 | $35,928 | 46% | | Nevada Taverns | $53,725 | $13,225 | 25% | Note 12 — Related Party Transactions This note details transactions between the company and its related parties, including lease agreements - The company leases office space from an entity partially owned by its Chairman and CEO, Blake L. Sartini, with rent expense of $0.1 million for the three months ended June 30, 202591 - The company sublets a portion of its headquarters to Sartini Enterprises, Inc., controlled by Mr. Sartini, with rental income of less than $0.1 million for the three and six months ended June 30, 202592 - No costs were incurred under aircraft time-sharing agreements with Sartini Enterprises, Inc. for the three and six months ended June 30, 202595 Note 13 — Subsequent Events This note discloses significant events that occurred after the balance sheet date but before the financial statements were issued - Subsequent to June 30, 2025, the Board of Directors authorized a quarterly cash dividend of $0.25 per share payable on October 3, 20255397 - New U.S. tax legislation (OBBBA) was signed into law, but is not expected to have a material impact on the company's financial statements6497 ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS This section provides management's perspective on the company's financial performance, liquidity, and capital resources for the three and six months ended June 30, 2025, compared to the prior year Overview This section provides an executive summary of the company's business, recent strategic activities, and operational segments - Golden Entertainment, Inc. operates a diversified entertainment platform, including eight casino properties and 72 branded taverns in Nevada102 - The company sold its distributed gaming operations in Nevada on January 10, 2024, for $213.5 million103 - Acquired two Great American Pub tavern locations on April 22, 2024, for $7.3 million, integrating them into the Nevada Taverns segment104 Operations This section describes the company's operational structure and the characteristics of its various business segments - As of June 30, 2025, the company operates through three reportable segments: Nevada Casino Resorts, Nevada Locals Casinos, and Nevada Taverns105 | Segment | Location | Casino Space (Sq. ft.) | Slot Machines | Table Games | Hotel Rooms | | :-------------------- | :---------------- | :--------------------- | :------------ | :---------- | :---------- | | Nevada Casino Resorts | Las Vegas, Laughlin, NV | 217,350 | 2,429 | 81 | 5,371 | | Nevada Locals Casinos | Las Vegas, Pahrump, NV | 151,857 | 1,839 | 18 | 631 | | Nevada Taverns | Nevada | — | 1,138 | — | — | | Totals | | 370,216 | 5,506 | 99 | 6,002 | Nevada Casino Resorts This section details the operations and customer base of the company's destination casino resort properties in Nevada - This segment includes destination casino resort properties like The STRAT, Aquarius, and Edgewater, catering to a regional drive-in customer base107108109 - These properties feature a large number of hotel rooms and offer various food and beverage outlets and entertainment venues107 - Operations of Colorado Belle Casino Resort have been suspended since March 2020, and its gaming license was surrendered on June 30, 2023110 Nevada Locals Casinos This section describes the operations and target market of the company's casino properties catering to local customers in Nevada - This segment comprises casino properties like Arizona Charlie's Boulder, Arizona Charlie's Decatur, Gold Town Casino, Lakeside Casino & RV Park, and Pahrump Nugget Hotel Casino, targeting local customers within a five-mile radius111112113 - These properties typically have higher frequency of customer visits, limited hotel rooms, and revenues primarily generated from slot machine play111 Nevada Taverns This section outlines the business model and offerings of the company's branded tavern locations in the Las Vegas metropolitan area - The Nevada Taverns segment consists of 72 branded tavern locations, primarily in the Las Vegas metropolitan area, offering a casual, upscale environment with food, craft beer, and up to 15 slot machines114 - Following the sale of distributed gaming operations, slot machines in taverns are owned and operated by an independent third party, with Golden receiving a percentage of gaming revenue114 Results of Operations (Consolidated) This section provides a consolidated analysis of the company's revenues, expenses, and net income for the reporting periods | Metric (in thousands) | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :-------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Total revenues | $163,620 | $167,334 | $324,463 | $341,381 | | Total expenses | $151,704 | $153,799 | $301,478 | $247,704 | | Operating income | $11,916 | $13,535 | $22,985 | $93,677 | | Net income | $4,632 | $623 | $7,131 | $42,586 | - Total revenues decreased by $3.7 million (2%) for the three months and $16.9 million (5%) for the six months ended June 30, 2025, primarily due to lower occupancy rates at Nevada Casino Resorts and the exclusion of distributed gaming operations117118 - Operating income decreased by $1.6 million (11.9%) for the three months and $70.7 million (75.5%) for the six months ended June 30, 2025, largely impacted by the prior year's gain on sale of business116 - Non-operating expense, net, decreased by $5.3 million (41%) for the three months and $8.5 million (36%) for the six months, mainly due to reduced interest expense and the absence of debt extinguishment losses from the prior year128 Revenues, Adjusted EBITDA and Adjusted EBITDA Margin by Reportable Segment This section presents a detailed breakdown of financial performance metrics for each of the company's operating segments - Adjusted EBITDA is a key metric used by management and investors to measure core operating results and determine executive compensation130 | Segment (in thousands) | Revenues (3M Jun 2025) | Revenues (3M Jun 2024) | Adj. EBITDA (3M Jun 2025) | Adj. EBITDA (3M Jun 2024) | Adj. EBITDA Margin (3M Jun 2025) | Adj. EBITDA Margin (3M Jun 2024) | | :--------------------- | :--------------------- | :--------------------- | :------------------------ | :------------------------ | :------------------------------- | :------------------------------- | | Nevada Casino Resorts | $98,196 | $101,093 | $25,970 | $27,392 | 26% | 27% | | Nevada Locals Casinos | $38,911 | $37,866 | $18,063 | $16,928 | 46% | 45% | | Nevada Taverns | $26,255 | $28,152 | $5,877 | $7,791 | 22% | 28% | | Total Adjusted EBITDA | | | $38,440 | $41,192 | | | | Segment (in thousands) | Revenues (6M Jun 2025) | Revenues (6M Jun 2024) | Adj. EBITDA (6M Jun 2025) | Adj. EBITDA (6M Jun 2024) | Adj. EBITDA Margin (6M Jun 2025) | Adj. EBITDA Margin (6M Jun 2024) | | :--------------------- | :--------------------- | :--------------------- | :------------------------ | :------------------------ | :------------------------------- | :------------------------------- | | Nevada Casino Resorts | $192,417 | $202,105 | $50,739 | $54,283 | 26% | 27% | | Nevada Locals Casinos | $77,742 | $76,857 | $35,928 | $34,464 | 46% | 45% | | Nevada Taverns | $53,725 | $55,959 | $13,225 | $15,352 | 25% | 27% | | Distributed Gaming | $— | $6,019 | $— | $484 | | | | Total Adjusted EBITDA | | | $76,021 | $82,184 | | | Nevada Casino Resorts (Segment Performance) This section details the revenue and Adjusted EBITDA performance of the Nevada Casino Resorts segment - Revenues decreased by $2.9 million (3%) for the three months and $9.7 million (5%) for the six months ended June 30, 2025, primarily due to lower occupancy rates134136137 - Adjusted EBITDA decreased by $1.4 million (5%) for the three months and $3.5 million (7%) for the six months, mainly due to higher labor costs and lower visitation136137 Nevada Locals Casinos (Segment Performance) This section details the revenue and Adjusted EBITDA performance of the Nevada Locals Casinos segment - Revenues increased by $1.0 million (2.8%) for the three months and $0.9 million (1%) for the six months ended June 30, 2025, driven by higher gaming and other revenues138139 - Adjusted EBITDA increased by $1.1 million (7%) for the three months and $1.5 million (4%) for the six months, primarily due to reduced operating expenses138139 Nevada Taverns (Segment Performance) This section details the revenue and Adjusted EBITDA performance of the Nevada Taverns segment - Revenues decreased by $1.9 million (7%) for the three months and $2.2 million (4%) for the six months ended June 30, 2025, due to lower visitation and changes in revenue recognition for certain taverns140141 - Adjusted EBITDA decreased by $1.9 million (25%) for the three months and $2.1 million (14%) for the six months, mainly due to higher labor costs and cost of goods140141 Distributed Gaming (Segment Performance) This section reports on the performance of the distributed gaming segment prior to its divestiture - This segment was divested on January 10, 2024, resulting in no revenues or Adjusted EBITDA for the periods ended June 30, 2025, compared to prior year142 Adjusted EBITDA Margin This section analyzes the profitability margins across the company's operating segments - Adjusted EBITDA margins for Nevada Casino Resorts and Nevada Locals Casinos remained consistent for the three and six months ended June 30, 2025143 - Nevada Taverns segment experienced a lower Adjusted EBITDA margin due to increased labor costs and reduced visitation143144 Liquidity and Capital Resources This section assesses the company's financial position, cash flow generation, and ability to meet its short-term and long-term obligations - As of June 30, 2025, the company had $52.3 million in cash and cash equivalents and $200 million in borrowing availability under its $240 million Revolving Credit Facility145168 - Management believes current liquidity sources are sufficient to meet capital requirements for the next 12 months145 - The company may seek additional debt or equity financing to enhance liquidity or fund future acquisitions147 Cash Flows This section provides a detailed analysis of the company's cash inflows and outflows from operating, investing, and financing activities - Net cash provided by operating activities decreased by $1.3 million (3%) to $46.0 million for the six months ended June 30, 2025, primarily due to timing of working capital spending148 - Net cash used in investing activities was $25.3 million in 2025, compared to $163.0 million provided in 2024 (due to the sale of distributed gaming operations)149 - Net cash used in financing activities decreased by $293.1 million (92%) to $26.1 million in 2025, mainly due to the prior year's $276.5 million repayment of senior notes150 Long-Term Debt This section details the company's long-term debt structure, including credit facilities and outstanding balances - The company's senior secured credit facility includes a $400 million Term Loan B-1 and a $240 million Revolving Credit Facility44151 - As of June 30, 2025, $392 million of Term Loan B-1 and $40 million of Revolving Credit Facility borrowings were outstanding44167 Share Repurchase Program This section outlines the company's share repurchase activities and remaining authorization under its program - The company has a $200 million share repurchase program, with $77.2 million remaining availability as of June 30, 202550152 - Repurchases can be made in open market transactions, block trades, or private transactions, and the program can be suspended at any time152 Other Items Affecting Liquidity This section discusses additional factors influencing the company's liquidity, such as capital expenditures and expansion plans - The company performs ongoing refurbishment and maintenance at its facilities, funding capital expenditures through operating cash flows and the Revolving Credit Facility155 - Potential expansion opportunities in existing or new markets may require substantial investments, funded by cash flows, the Revolving Credit Facility, or additional financing157 Critical Accounting Policies and Estimates This section highlights the significant accounting judgments and estimates used in preparing the financial statements - The preparation of financial statements requires estimates and assumptions, particularly for acquisition accounting, long-lived assets, goodwill, intangible assets, revenue recognition, income taxes, and share-based compensation158 - As of October 1, 2024, the estimated fair value of an indefinite-lived trade name in the Nevada Casino Resorts segment did not significantly exceed its carrying value, indicating potential future impairment risk159 - No material changes to critical accounting policies and estimates occurred during the three and six months ended June 30, 2025160 Seasonality This section discusses how seasonal factors, such as holidays and weather, impact the company's business operations and revenues - The company's businesses are affected by seasonal factors, including holidays, weather, and travel conditions161 - Nevada casino properties and taverns typically experience lower revenues during the summer due to high temperatures and increased local vacation activity161 - Branded taverns generally see higher revenues in the fall, coinciding with professional sports seasons161 Recently Issued Accounting Pronouncements This section addresses the potential impact of new accounting standards on the company's financial reporting - The company is evaluating ASU No. 2023-09 (Income Taxes) and ASU No. 2024-03/2025-01 (Expense Disaggregation Disclosures) but does not expect a material impact on its financial statements2930162 Regulation and Taxes This section outlines the extensive regulatory environment and tax considerations affecting the company's gaming operations - The company's business is subject to extensive regulation by state gaming authorities, and changes in laws could materially affect operations163 - The gaming industry is a significant source of tax revenues, and potential changes in tax law could adversely impact the company's financial position164 Off Balance Sheet Arrangements This section confirms the absence of material off-balance sheet arrangements that could significantly impact the company's financial condition - The company has no off-balance sheet arrangements that are material to its financial condition, revenues, expenses, results of operations, liquidity, capital expenditures, or capital resources165 ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK This section outlines the company's primary market risk exposure, which is interest rate risk associated with its variable-rate long-term debt, specifically the senior secured credit facility - The primary market risk exposure is interest rate risk from variable-rate long-term debt, mainly the senior secured credit facility166 - As of June 30, 2025, outstanding variable-rate debt included $392 million from Term Loan B-1 and $40 million from the Revolving Credit Facility, with a weighted-average effective interest rate of 6.60%167 - A 50 basis point increase in the applicable interest rate would increase annual interest incurred by $2.2 million167 ITEM 4. CONTROLS AND PROCEDURES This section confirms the effectiveness of the company's disclosure controls and procedures as of June 30, 2025, and states that there have been no material changes in internal control over financial reporting during the quarter - The CEO and CFO concluded that disclosure controls and procedures were effective at a reasonable assurance level as of June 30, 2025170 - No material changes in internal control over financial reporting occurred during the quarter ended June 30, 2025171 PART II. OTHER INFORMATION This section includes disclosures on legal proceedings, risk factors, equity security sales, and other miscellaneous information ITEM 1. LEGAL PROCEEDINGS This section refers to the detailed discussion of the company's legal proceedings within the financial statement notes - Information regarding legal proceedings is contained in Note 10 — Commitments and Contingencies in Part I, Item 1: Financial Statements172 ITEM 1A. RISK FACTORS This section directs readers to the comprehensive risk factors discussed in the company's Annual Report on Form 10-K, noting no material changes in the current reporting period - Readers should consider risk factors discussed in Part I, Item 1A of the Annual Report, as they could materially affect the business173 - No material changes to the risk factors described in the Annual Report have occurred173 ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS This section details the company's common stock repurchase activity for the three months ended June 30, 2025, under its authorized share repurchase program - The company repurchases common stock under a Board-authorized share repurchase program, which can be suspended or discontinued at any time175 | Period | Total Number of Shares Purchased | Average Price per Share | | :--------------- | :------------------------------- | :---------------------- | | April 1-30, 2025 | — | $— | | May 1-31, 2025 | 321,516 | $28.67 | | June 1-30, 2025 | 192,634 | $28.13 | | Total | 514,150 | $28.47 | - As of June 30, 2025, $77.2 million remained available for repurchase under the program176 ITEM 5. OTHER INFORMATION This section confirms that the company's directors and officers did not adopt or terminate any Rule 10b5-1 trading plans or non-Rule 10b5-1 trading arrangements during the quarter - Directors and officers did not adopt or terminate any Rule 10b5-1 trading plans or non-Rule 10b5-1 trading arrangements during the three months ended June 30, 2025178 ITEM 6. EXHIBITS This section lists the exhibits filed as part of the Quarterly Report on Form 10-Q, including certifications and XBRL-related documents - Exhibits include certifications from the CEO and CFO (Sections 302 and 906 of Sarbanes-Oxley Act) and various Inline XBRL documents179 SIGNATURES This section contains the required signatures from the company's principal executive, financial, and accounting officers, certifying the filing of the Quarterly Report on Form 10-Q - The report is signed by Blake L. Sartini (Chairman of the Board and CEO), Charles H. Protell (President and CFO), and Viktoryia G. Pulliam (Senior Vice President and Chief Accounting Officer)181182