Red Rock Resorts(RRR) - 2022 Q4 - Annual Report

Financial Performance - Net revenues for the year ended December 31, 2022, increased by $45.9 million to$1.66 billion, a growth of 2.8% compared to 2021[249]. - Operating income rose by 39.8% to $561.3 million for 2022, up from$401.5 million in 2021[250]. - For the year ended December 31, 2022, net revenues increased to $1.66 billion, up from$1.62 billion in 2021, representing a year-over-year growth of 2.5%[265]. - Adjusted EBITDA for the year ended December 31, 2022, was $743.9 million, slightly up from$741.0 million in 2021, indicating a stable operating performance[265]. - Interest expense, net, for the year ended December 31, 2022, was $129.9 million, a 25.9$103.2 million in 2021, primarily due to higher variable interest rates[261]. - Net cash provided by operating activities for the year ended December 31, 2022, was $542.2 million, a decrease of 11.1$610.0 million in 2021[284]. Revenue Breakdown - Casino revenues decreased by 1.4% to $1.13 billion in 2022, while food and beverage revenues increased by 15.3$283.1 million[247][249]. - Room revenues increased by 14.3% to $164.5 million, with room expenses decreasing by 6.0$179.88, and revenue per available room increased by 30.9% to 149.34[253]. Expenses and Costs - SG&A expenses increased by 1.7% to 353.0 million, remaining effectively flat as a percentage of net revenue[256][257]. - Depreciation and amortization expenses decreased to $128.4 million from$157.8 million in 2021, primarily due to the sale of Palms and the closure of certain properties[258]. - The company is experiencing inflationary pressures, particularly in food, supplies, and labor costs, and is implementing cost controls to mitigate these impacts[292]. Capital Expenditures and Investments - Cash paid for capital expenditures in 2022 totaled $328.6 million, significantly higher than$61.3 million in 2021, reflecting investments in the Durango project[285]. - The company plans to allocate approximately $550.0 million to$600.0 million for investment capital expenditures in 2023, including the Durango project[275]. Shareholder Actions - A quarterly cash dividend of $0.25 per share of Class A common stock was declared on February 7, 2023, to be paid on March 31, 2023[278]. - The company repurchased 3.7 million shares of Class A common stock for an aggregate price of$141.5 million during the year ended December 31, 2022[280]. - The company repurchased approximately 3.7 million shares of Class A common stock for $141.5 million during the year ended December 31, 2022, with a remaining repurchase authorization of$312.9 million[280]. Debt and Financing - The company had outstanding letters of credit totaling $29.4 million as of December 31, 2022[291]. - The company expects to fund its capital requirements through a combination of cash generated from operations, borrowings, and issuance of debt or equity, but acknowledges potential impacts from competition and economic conditions[281]. - An assumed 1$18.0 million based on outstanding borrowings at December 31, 2022[277]. - As of December 31, 2022, the company had $1.8 billion in borrowings under credit agreements based on variable rates, primarily LIBOR, with a potential annual interest cost increase of approximately$18.0 million for a 1% rise in rates[277]. Asset Management - The company permanently closed several properties in 2022, which may indicate potential impairment of long-lived assets[301]. - As of December 31, 2022, the carrying amount of property and equipment was approximately $2.2 billion, representing 65.6$195.7 million as of December 31, 2022, with annual impairment testing conducted each October[303]. - Indefinite-lived intangible assets amounted to $76.5 million as of December 31, 2022, and are tested for impairment annually[308]. Tax and Legal Matters - The company recorded uncertain tax positions based on a two-step process, with no significant liabilities for unrecognized tax benefits expected within the next twelve months[315]. - The company is involved in various lawsuits and assesses the potential for losses, accruing liabilities when losses are deemed probable[311].