Monarch Casino & Resort — Third Quarter 2026 Earnings Summary

Financial Performance:

• Net revenue for the three months ended September 30, 2026, reached $146.3 million, a 2.4% increase year-over-year from $142.8 million; for the nine months ended September 30, 2026, net revenue was $425.4 million, up 5.0% from $405.1 million.
• Net income for the quarter was $32.0 million, a 1.4% increase from $31.6 million in the prior-year period; for the nine-month period, net income was $92.1 million, a 17.4% increase from $78.4 million.
• Adjusted EBITDA for the quarter was $56.0 million, a 2.1% increase from $54.8 million, with an adjusted EBITDA margin of 38.3%; for the nine months, Adjusted EBITDA was $158.0 million, a 7.3% increase from $147.3 million.
• Diluted EPS for the quarter was $1.76, up 4.1% from $1.69; for the nine months, diluted EPS was $5.06, up 21.1% from $4.18.
• Casino revenue increased 3.4% year-over-year to $82.8 million for the quarter; food and beverage revenue increased 1.3% to $34.3 million; hotel revenue increased 0.9% to $22.7 million.
• SG&A expense was $29.0 million for the quarter (19.8% of net revenue), up from $27.5 million (19.3% of net revenue) in the prior year, driven by increased legal and employee-related expenses.
• Casino operating expense remained unchanged at 35.8% of casino revenue; F&B operating expense decreased to 69.6% from 69.9%; hotel operating expense decreased to 31.3% from 31.4%.
• Cash and cash equivalents were $137.4 million as of September 30, 2026, with no borrowings against the credit facility.

Guidance and Future Outlook:

• Management expressed confidence in the company's ability to drive sustained growth from its two properties and maintain operational efficiency.
• The company intends to continue investing in technology and strategic capital projects to enhance its properties in Northern Nevada and Colorado.
• Monarch believes its strong balance sheet and free cash flow position it to continue investing in properties, share repurchases, and cash dividends.
• The company is actively evaluating potential M&A transactions that could drive additional long-term value for stockholders.

Business Segments and Product Lines:

• Revenue growth was driven by increases across casino, food and beverage, and hotel segments.
• Capital expenditures of $9.7 million in the quarter funded ongoing maintenance, new gaming equipment purchases at both properties, and the purchase of land with a building adjacent to the Atlantis property.
• The company operates two properties: Monarch Casino Resort Spa in Black Hawk, Colorado, and Atlantis Casino Resort Spa in Reno, Nevada.

Market and Competitive Landscape:

• Management noted competition in target market areas as a potential risk factor.
• The company is monitoring market trends including potential recessions, changes in guest visitation or spending patterns, and the impact of tariffs on operating costs.

Risks and Challenges:

• A construction litigation judgment of $74.6 million was entered against the company in favor of PCL Construction Services, Inc., with the company currently appealing the judgment.
• Risks include potential increases in minimum wages, changes in gaming laws, labor shortages, and increased regulatory burdens.
• The company faces risks related to construction delays, cost overruns, and disputes with contractors.
• Potential adverse impacts from contagious disease outbreaks, government shutdowns, and international conflicts are noted.

Management Commentary and Tone:

• CEO John Farahi described the quarter as delivering "record quarterly net revenue and adjusted EBITDA," highlighting the company's ability to drive sustained growth.
• Management emphasized a commitment to delivering market-leading offerings while maintaining operational efficiency.
• The tone reflected confidence in the company's solid cash position and its ability to return capital to stockholders.

Other Key Points:

• The company declared a cash dividend of $0.30 per share, payable on December 15, 2026, to stockholders of record as of December 1, 2026.
• In the third quarter, the company repurchased 300,859 shares of common stock for $37 million under its existing share repurchase plan.
• As of September 30, 2026, 670,644 shares remained available for repurchase out of the original 3,000,000 share authorization.
• Total cash returned to stockholders in the quarter included $5.3 million in dividends and $37 million in share repurchases.
• The annual cash dividend is set at $1.20 per share, payable in quarterly payments subject to quarterly review.