BOYD GAMING CORPORATION (Exact Name of Registrant As Specified in Its Charter) ______Nevada 88-0242733 (State Or Other Jurisdiction of (I.R.S
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UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 ____________________________________________________ FORM 10-K ____________________________________________________ (Mark One) ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended December 31, 2017 OR TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Commission file number: 1-12882 ____________________________________________________ BOYD GAMING CORPORATION (Exact name of registrant as specified in its charter) ____________________________________________________ Nevada 88-0242733 (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identification No.) 3883 Howard Hughes Parkway, Ninth Floor, Las Vegas, NV 89169 (Address of principal executive offices) (Zip Code) (702) 792-7200 (Registrant’s telephone number, including area code) Securities registered pursuant to Section 12(b) of the Act: Title of each class Name of each exchange on which registered Common Stock, par value of $0.01 per share New York Stock Exchange Securities registered pursuant to Section 12(g) of the Act: None Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes No Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes No 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 No Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Website, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes No Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K (§229.405 of this chapter) is not contained herein, and will not be contained, to the best of registrant's knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of "large accelerated filer," "accelerated filer," "smaller reporting company," and "emerging growth company" in Rule 12b-2 of the Exchange Act. Large accelerated filer Accelerated filer Non-accelerated filer (Do not check if a smaller reporting company) Smaller reporting company Emerging growth company If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes No As of June 30, 2017, the aggregate market value of the voting common stock held by non-affiliates of the registrant, based on the closing price on the New York Stock Exchange for such date, was approximately $2.0 billion. Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date. Class Outstanding as of February 21, 2018 Common stock, $0.01 par value 112,507,885 DOCUMENTS INCORPORATED BY REFERENCE Portions of the definitive Proxy Statement for the registrant's 2018 Annual Meeting of Stockholders to be filed pursuant to Regulation 14A within 120 days after the registrant's fiscal year end of December 31, 2017 are incorporated by reference into Part III of this Form 10-K. BOYD GAMING CORPORATION ANNUAL REPORT ON FORM 10-K FOR THE FISCAL YEAR ENDED DECEMBER 31, 2017 TABLE OF CONTENTS Page No. PART I ITEM 1. Business 1 ITEM 1A. Risk Factors 10 ITEM 1B. Unresolved Staff Comments 23 ITEM 2. Properties 24 ITEM 3. Legal Proceedings 24 ITEM 4. Mine Safety Disclosures 24 PART II ITEM 5. Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities 25 ITEM 6. Selected Financial Data 28 ITEM 7. Management's Discussion and Analysis of Financial Condition and Results of Operations 30 ITEM 7A. Quantitative and Qualitative Disclosures About Market Risk 51 ITEM 8. Financial Statements and Supplementary Data 52 ITEM 9. Changes in and Disagreements With Accountants on Accounting and Financial Disclosure 112 ITEM 9A. Controls and Procedures 112 ITEM 9B. Other Information 114 PART III ITEM 10. Directors, Executive Officers and Corporate Governance 114 ITEM 11. Executive Compensation 114 ITEM 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters 115 ITEM 13. Certain Relationships and Related Transactions, and Director Independence 115 ITEM 14. Principal Accounting Fees and Services 115 PART IV ITEM 15. Exhibits, Financial Statement Schedules 116 ITEM 16. Form 10-K Summary 123 SIGNATURES 124 PART I ITEM 1. Business Overview Boyd Gaming Corporation (the "Company," the "Registrant," "Boyd Gaming," "we" or "us") is a multi-jurisdictional gaming company that has been in operation since 1975. Headquartered in Las Vegas, we have 24 wholly owned gaming entertainment properties in Nevada, Illinois, Indiana, Iowa, Kansas, Louisiana and Mississippi. Our primary areas of focus are: (i) ensuring our existing operations are managed as efficiently as possible and remain positioned for growth, including our strategic investing in non-gaming amenities; (ii) improving our capital structure and strengthening our balance sheet, including paying down debt, improving operations and diversifying our asset base; and (iii) successfully implementing our growth strategy, which is built on identifying development opportunities and acquiring assets that are a good strategic fit and provide an appropriate return to our shareholders. Over the past several years, we have undertaken several programs aimed at reducing our cost structure in an effort to manage our properties' operations under tightened revenue trends. We have established a more efficient business model that we believe is helping us realize improved results, and we believe we have an opportunity to realize additional cost savings by leveraging our size and scale. We have strategically reinvested in our non-gaming amenities, including hotel rooms and restaurants, via a multi- year program that has now been completed to better capitalize on customers' evolving spending behaviors. We continue to manage our cost and expense structure to adjust to current business volumes and to generate strong and stable cash flows. During 2017, we completed several transactions that improved our long-term financial position and strengthened our balance sheet. During first quarter 2017, we entered into Amendment No. 2 and Refinancing Amendment to our credit agreement which combined the Term B-1 Loan and Term B-2 Loan into the Refinancing Term B Loans. Since first quarter 2017, we have paid $85.0 million in prepayments on our Refinancing Term B Loans. On May 2, 2017, the Company announced that its Board of Directors had reaffirmed the Company's existing share repurchase program and authorized the reinstatement of the Company’s cash dividend program. Starting in second quarter 2017, the Company repurchased 1.2 million shares. The Company declared quarterly dividends of $0.05 per share on May 2, 2017, September 6, 2017 and December 7, 2017. We continually work to position our Company for greater success by strengthening our existing operations and growing through capital investment and other strategic initiatives. An example is our recent strategic initiative to enhance our non-gaming amenities at properties across the country that is designed to ensure our properties remain competitive and compelling to customers across generations. This initiative began in 2014 and continued into 2017, a period during which we invested over $100 million in these amenities. We have redesigned and enhanced approximately 3,100 hotel rooms at our properties across the country. We also introduced new food and beverage concepts across the Company, including Alder & Birch, Copper Whisk, Ondori, Bailiwick and the French Market Buffet at The Orleans, California Noodle House at the California, the Filament Bar at Fremont and the Filament Meetery & Eatery at Diamond Jo Dubuque, the Spotted Horse and Fast & Lucy’s Pub at Evangeline Downs, Angry Butcher and Big Mess BBQ at Sam's Town Las Vegas and Brigg’s Oyster Company at Suncoast. On December 18, 2017, we announced that we had entered into a definitive agreement with Penn National Gaming, Inc. (the "Penn National Purchase Agreement"), to acquire the operations of four properties, which include Ameristar St. Charles and Ameristar Kansas City, both in Missouri, Belterra Casino Resort in Florence, Indiana, and Belterra Park in Cincinnati, Ohio, for total cash consideration of $575.0 million (the "Penn National Purchase"). As part of the transaction, we will enter into a master lease agreement with Gaming and Leisure Properties, Inc. ("GLPI"), which owns the real estate of Ameristar St. Charles, Ameristar Kansas City and Belterra Casino Resort. GLPI has entered into an agreement to purchase the real estate of Belterra Park from Penn National, and Belterra Park’s real estate will be leased to us as part of our master lease agreement with GLPI. The terms of our lease agreement will be substantially similar to Pinnacle’s current master lease with GLPI. On December 20, 2017, we announced that we had entered into a definitive agreement with Valley Forge Convention Center Partners, L.P.