VICI PROPERTIES INC. ANNOUNCES SECOND QUARTER 2023 RESULTS
- Reports 35.5% Year-over-Year Revenue Growth -
- Expands International Footprint in Canada with Century Casinos -
- Completed Acquisition of Rocky Gap Casino Resort -
- Announced Expansion of Partnership with Canyon Ranch -
- Updates Guidance for Full Year 2023 -
NEW YORK, NY – July 26, 2023 – VICI Properties Inc. (NYSE: VICI) (“VICI Properties” or the “Company”), an experiential real estate investment trust, today reported results for the quarter ended June 30, 2023. All per share amounts included herein are on a per diluted common share basis unless otherwise stated.
Second Quarter 2023 Financial and Operating Highlights
•Total revenues increased 35.5% year-over-year to $898.2 million
•Net income attributable to common stockholders increased year-over-year to $690.7 million from $(57.7) million and, on a per share basis, increased year-over-year to $0.69 from $(0.06)
•AFFO attributable to common stockholders increased 25.7% year-over-year to $540.4 million and, on a per share basis, increased 11.9% year-over-year to $0.54
•Weighted average shares outstanding increased 12.4% year-over-year
•Announced the acquisition of the real estate of Century Casinos' four gaming properties in Alberta, Canada
•Ended the quarter with $738.8 million in cash and cash equivalents and $867.9 million of estimated forward sale equity proceeds
•Updated AFFO guidance for full year 2023 to between $2,130 million and $2,160 million, or between $2.11 and $2.14 per diluted share
•Subsequent to quarter end, completed the previously announced Rocky Gap Casino Resort acquisition with Century Casinos
•Subsequent to quarter end, expanded our partnership with Canyon Ranch through a preferred equity investment and call rights to acquire Canyon Ranch Tucson and Canyon Ranch Lenox
CEO Comments
Edward Pitoniak, Chief Executive Officer of VICI Properties, said, “VICI’s strong second quarter financial performance, exemplified by approximately 36% revenue growth and nearly 12% growth in AFFO per share year-over-year, reflects the impact of our consistent commitment to accretive acquisitions and strategic financings. We also ended the quarter with ample liquidity, including $739 million in cash and cash equivalents, $868 million of estimated equity proceeds available upon settlement of forward sale agreements, and $2.4 billion of availability under the Revolving Credit Facility. The quarter's results and current liquidity enable VICI to continue in our pursuit of attractive domestic and international growth opportunities across the experiential landscape.
“In the second quarter, we continued to expand our international presence through the announced acquisition of four casino properties in Alberta, Canada with our existing tenant and partner, Century Casinos. Subsequent to quarter end, we also closed the previously announced acquisition with Century of Rocky Gap, proving the value of our enduring partnerships with growth-minded operators. Finally, we are excited to announce that subsequent to quarter end, we broadened and deepened our relationship with Canyon Ranch through the establishment of our VICI-Canyon Ranch Growth Partnership, a multi-faceted
investment relationship. This initiative (fully described in a separate VICI release and VICI transaction deck at www.viciproperties.com) includes VICI investing preferred equity into the Canyon Ranch operating platform, an investment that will contribute to enabling the Canyon Ranch operating platform to resource the growth of the Canyon Ranch resort network and other brand extensions. Through this investment, we have also further enhanced our embedded growth pipeline with call rights on Canyon Ranch Tucson and Canyon Ranch Lenox as well as solidified the partnership as the capital partner for Canyon Ranch as they look to expand their wellness resort ecosystem.”
Second Quarter 2023 Financial Results
Total Revenues
Total revenues were $898.2 million for the quarter, an increase of 35.5% compared to $662.6 million for the quarter ended June 30, 2022. Total revenues for the quarter included $129.5 million of non-cash leasing and financing adjustments and $18.5 million of other income.
Net Income (Loss) Attributable to Common Stockholders
Net income (loss) attributable to common stockholders was $690.7 million for the quarter, or $0.69 per share, compared to $(57.7) million, or $(0.06) per share, for the quarter ended June 30, 2022. The net loss and net loss per share in Q2 2022 was primarily related, on an absolute basis, to the $551.9 million increase in the CECL allowance for the quarter ended June 30, 2022. Approximately 80% of the total allowance increase in Q2 2022 was driven by the CECL charge in relation to our entry into the MGM Master Lease in connection with the acquisition of MGM Growth Properties LLC, which closed on April 29, 2022.
Funds from Operations (“FFO”)
FFO attributable to common stockholders was $690.7 million for the quarter, or $0.69 per share, compared to $(50.4) million, or $(0.06) per share, for the quarter ended June 30, 2022. The FFO and FFO per share loss in Q2 2022 was primarily related to, on an absolute basis, the increase in the CECL allowance for the quarter ended June 30, 2022, as described above.
Adjusted Funds from Operations (“AFFO”)
AFFO attributable to common stockholders was $540.4 million for the quarter, an increase of 25.7% compared to $430.1 million for the quarter ended June 30, 2022. AFFO per share was $0.54 for the quarter, an increase of 11.9% compared to $0.48 for the quarter ended June 30, 2022.
Second Quarter 2023 Acquisitions and Portfolio Activity
Acquisitions and Investments
On May 16, 2023, the Company entered into definitive agreements to acquire four real estate assets from Century Casinos, Inc. (NASDAQ: CNTY) ("Century") in Alberta, Canada: Century Casino & Hotel Edmonton, Century Casino St. Albert and Century Mile Racetrack and Casino, each in Edmonton, Alberta and Century Downs Racetrack and Casino in Calgary, Alberta, (collectively the “Century Canadian Portfolio”) for an aggregate purchase price of approximately C$221.7 million (approximately US$164.7 million based on the exchange rate at the time of the announcement) in cash. Simultaneous with the acquisition, the Century Canadian Portfolio will be added to the existing triple-net master lease agreement between the Company and Century (the "Century Master Lease") and annual rent will increase by C$17.3 million (approximately US$12.8 million based on the
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exchange rate at the time of the announcement) representing an implied acquisition capitalization rate of 7.8%. The Century Canadian Portfolio acquisition remains subject to customary closing conditions, including regulatory approvals, and is expected to close in the second half of 2023.
Subsequent to quarter-end, on July 25, 2023, the Company completed the previously announced transaction to acquire the leasehold interest in the land and buildings associated with Rocky Gap Casino Resort ("Rocky Gap") in Flintstone, Maryland for $203.9 million in cash, with Century acquiring the operating assets of Rocky Gap for $56.1 million. Simultaneous with the close of the acquisition, Rocky Gap was added to the Century Master Lease and annual rent increased by $15.5 million. The transaction was funded through a combination of cash on hand and proceeds from the partial settlement of forward equity sale agreements discussed below.
Subsequent to quarter-end, on July 26, 2023, the Company committed to an up to $150.0 million preferred equity investment into the controlling entity of Canyon Ranch, a leading provider of holistic, integrative health and wellness guest experiences ("Canyon Ranch"). The preferred equity has a term of 10 years and may be redeemed by Canyon Ranch at any time, subject to a redemption premium in the first three years. In connection with this investment, the Company entered into (i) a call right agreement whereby the Company will have the option to call the real estate assets of each of the Canyon Ranch facility in Tucson, Arizona ("Canyon Ranch Tucson") and the Canyon Ranch facility in Lenox, Massachusetts ("Canyon Ranch Lenox") subject to certain conditions, and (ii) a right of first financing agreement pursuant to which the Company will have the first right, but not the obligation, to serve as the real estate capital financing partner for Canyon Ranch with respect to the acquisition, build-out and/or redevelopment of future wellness resorts. If the call right(s) are exercised, Canyon Ranch would continue to operate the applicable wellness resort(s) subject to a long-term triple net master lease with the Company.
In addition, the Company intends to provide approximately $150.0 million of mortgage financing to a subsidiary of Canyon Ranch secured by Canyon Ranch Tucson and Canyon Ranch Lenox. Proceeds of the mortgage financing would be used to refinance Canyon Ranch’s existing CMBS debt secured by these two assets. The mortgage financing will have an initial term of two years with three one-year extensions, exercisable at Canyon Ranch’s option, subject to satisfying certain customary extension conditions. The Company expects the mortgage financing to close in Q3 2023.
Second Quarter 2023 Capital Markets Activity
On April 4, 2023, and subsequent to quarter end, on July 20, 2023, the Company physically settled 3,200,000 and 6,000,000 shares, respectively, under the January 2023 forward sale agreements in exchange for aggregate net proceeds of approximately $291.8 million.
During the three months ended June 30, 2023, the Company sold a total of 327,306 shares under its ATM program for a net value of $10.4 million, all of which were sold subject to a forward sale agreement (the "Q2 2023 ATM Forward Sale Agreement"). The Company did not receive any proceeds from the sale of shares at the time it entered into the Q2 2023 ATM Forward Sale Agreement.
Subsequent to quarter end, on July 12, 2023, the Company entered into a forward-starting interest rate swap agreement with an aggregate notional amount of $50.0 million, intended to reduce the variability in future cash flows for a forecasted issuance of long-term debt over a maximum period ended December 2024.
The following table details the issuance of outstanding shares of common stock, including restricted common stock:
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Six Months Ended June 30,
Common Stock Outstanding
2023
2022
Beginning Balance January 1,
963,096,563
628,942,092
Issuance of common stock upon physical settlement of forward sale agreements
43,792,592
119,000,000
Issuance of common stock in connection with the MGP Transactions
—
214,552,532
Issuance of restricted and unrestricted common stock under the stock incentive program, net of forfeitures
537,355
596,361
Ending Balance June 30,
1,007,426,510
963,090,985
The following table reconciles the weighted-average shares of common stock outstanding used in the calculation of basic earnings per share to the weighted-average shares of common stock outstanding used in the calculation of diluted earnings per share:
Three Months Ended June 30,
Six Months Ended June 30,
2023
2022
2023
2022
Determination of shares:
Weighted-average shares of common stock outstanding
1,006,893,810
896,545,880
1,004,189,744
791,029,664
Assumed conversion of restricted stock(1)
696,046
—
884,292
698,797
Assumed settlement of forward sale agreements
378,566
—
805,359
1,496,376
Diluted weighted-average shares of common stock outstanding
1,007,968,422
896,545,880
1,005,879,395
793,224,837
____________________
(1)For the three months ended June 30, 2022, any such amounts have been excluded from the diluted weighted average number of shares of common stock as the Company was in a net loss position and the effect of inclusion would have been anti-dilutive. Assuming the Company had net income for the quarter, using the treasury stock method, the assumed conversion of our restricted stock would have been in the amount of 816,708 shares.
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Balance Sheet and Liquidity
As of June 30, 2023, the Company had approximately $17.1 billion in total debt and approximately $4.0 billion in liquidity, comprised of $738.8 million in cash and cash equivalents, $867.9 million of estimated proceeds available upon settlement of outstanding forward sale agreements, and approximately $2.4 billion of availability under the Revolving Credit Facility. In addition, the Revolving Credit Facility includes the option to increase the revolving loan commitments by up to $1.0 billion to the extent that any one or more lenders (from the syndicate or otherwise) agree to provide such additional credit extensions.
The Company’s outstanding indebtedness as of June 30, 2023 was as follows:
($ in millions)
June 30, 2023
Revolving Credit Facility
USD Borrowings
$
—
CAD Borrowings
105.7
5.625% Notes Due 2024
1,050.0
3.500% Notes Due 2025
750.0
4.375% Notes Due 2025
500.0
4.625% Notes Due 2025
800.0
4.500% Notes Due 2026
500.0
4.250% Notes Due 2026
1,250.0
5.750% Notes Due 2027
750.0
3.750% Notes Due 2027
750.0
4.500% Notes Due 2028
350.0
4.750% Notes Due 2028
1,250.0
3.875% Notes Due 2029
750.0
4.625% Notes Due 2029
1,000.0
4.950% Notes Due 2030
1,000.0
4.125% Notes Due 2030
1,000.0
5.125% Notes Due 2032
1,500.0
5.625% Notes Due 2052
750.0
Total Unsecured Debt Outstanding, Face Value
$
14,055.7
MGM Grand/Mandalay Bay CMBS Debt Due 2032
$
3,000.0
Total Debt Outstanding, Face Value
$
17,055.7
Cash and Cash Equivalents
738.8
Net Debt
$
16,316.9
Dividends
On June 8, 2023, the Company declared a regular quarterly cash dividend of $0.39 per share. The Q2 2023 dividend was paid on July 6, 2023 to stockholders of record as of the close of business on June 22, 2023 and totaled in aggregate approximately $392.9 million.
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2023 Guidance
The Company is updating AFFO guidance for the full year 2023. In determining AFFO, the Company adjusts for certain items that are otherwise included in determining net income attributable to common stockholders, the most comparable generally accepted accounting principles in the United States (“GAAP”) financial measure. In reliance on the exception provided by applicable rules, the Company does not provide guidance for GAAP net income, the most comparable GAAP financial measure, or a reconciliation of 2023 AFFO to GAAP net income because we are unable to predict with reasonable certainty the amount of the change in non-cash allowance for credit losses under ASU No. 2016-13 - Financial Instruments—Credit Losses (Topic 326) (“ASC 326”) for a future period. The non-cash change in allowance for credit losses under ASC 326 with respect to a future period is dependent upon future events that are entirely outside of the Company’s control and may not be reliably predicted, including its tenants’ respective financial performance, fluctuations in the trading price of their common stock, credit ratings and outlook (each to the extent applicable), as well as broader macroeconomic performance. Based on past results and, as disclosed in our historical financial results, the impact of these adjustments could be material, individually or in the aggregate, to the Company’s reported GAAP results. For more information, see “Non-GAAP Financial Measures.”
The Company estimates AFFO for the year ending December 31, 2023 will be between $2,130 million and $2,160 million, or between $2.11 and $2.14 per diluted share. Guidance does not include the impact on operating results from any pending or possible future acquisitions or dispositions, capital markets activity, or other non-recurring transactions.
The following is a summary of the Company’s full-year 2023 guidance:
Updated Guidance
Prior Guidance
For the Year Ending December 31, 2023 ($ in millions):
Low
High
Low
High
Estimated Adjusted Funds From Operations (AFFO)
$2,130
$2,160
$2,115
$2,155
Estimated Adjusted Funds From Operations (AFFO) per diluted share
$2.11
$2.14
$2.10
$2.13
Estimated Weighted Average Share Count for the Year (in millions)
1,011.7
1,011.7
1,009.5
1,009.5
The above per share estimates reflect the dilutive effect of the pending 21,102,500 shares related to the January 2023 Forward Sale Agreements and 327,306 shares related to the Q2 2023 ATM Forward Sale Agreement as calculated under the treasury stock method. VICI OP Units held by a third party are reflected as non-controlling interests and the income allocable to them is deducted from net income to arrive at net income attributable to common stockholders and AFFO; accordingly, guidance represents AFFO per share attributable to common stockholders based solely on outstanding shares of VICI common stock.
The estimates set forth above reflect management’s view of current and future market conditions, including assumptions with respect to the earnings impact of the events referenced in this release. The estimates set forth above may be subject to fluctuations as a result of several factors and there can be no assurance that the Company’s actual results will not differ materially from the estimates set forth above.
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Supplemental Information
In addition to this release, the Company has furnished Supplemental Financial Information, which is available on our website in the “Investors” section, under the menu heading “Financials”. This additional information is being provided as a supplement to the information in this release and our other filings with the SEC. The Company has no obligation to update any of the information provided to conform to actual results or changes in the Company’s portfolio, capital structure or future expectations.
Conference Call and Webcast
The Company will host a conference call and audio webcast on Thursday, July 27, 2023 at 10:00 a.m. Eastern Time (ET). The conference call can be accessed by dialing +1 833-470-1428 (domestic) or +1 929-526-1599 (international) and entering the conference ID 939948. An audio replay of the conference call will be available from 1:00 p.m. ET on July 27, 2023 until midnight ET on August 3, 2023 and can be accessed by dialing +1 866-813-9403 (domestic) or +44 204-525-0658 (international) and entering the passcode 307960.
A live audio webcast of the conference call will be available in listen-only mode through the “Investors” section of the Company’s website, www.viciproperties.com, on July 27, 2023, beginning at 10:00 a.m. ET. A replay of the webcast will be available shortly after the call on the Company’s website and will continue for one year.
About VICI Properties
VICI Properties Inc. is an S&P 500® experiential real estate investment trust that owns one of the largest portfolios of market-leading gaming, hospitality and entertainment destinations, including Caesars Palace Las Vegas, MGM Grand and the Venetian Resort Las Vegas, three of the most iconic entertainment facilities on the Las Vegas Strip. VICI Properties’ geographically diverse portfolio consists of 50 gaming facilities across the United States and Canada comprising approximately 124 million square feet and features approximately 60,300 hotel rooms and more than 450 restaurants, bars, nightclubs and sportsbooks. Its properties are occupied by industry leading gaming and hospitality operators under long-term, triple-net lease agreements. VICI Properties has a growing array of investing and financing partnerships with leading non-gaming experiential operators, including Great Wolf Resorts, Cabot, Canyon Ranch and Chelsea Piers. VICI Properties also owns four championship golf courses and 34 acres of undeveloped and underdeveloped land adjacent to the Las Vegas Strip. VICI Properties’ goal is to create the highest quality and most productive experiential real estate portfolio through a strategy of partnering with the highest quality experiential place makers and operators. For additional information, please visit www.viciproperties.com.
Forward-Looking Statements
This press release contains forward-looking statements within the meaning of the federal securities laws. You can identify these statements by our use of the words “anticipates,” “assumes,” “believes,” “estimates,” “expects,” “guidance,” “intends,” “plans,” “projects,” and similar expressions that do not relate to historical matters. All statements other than statements of historical fact are forward-looking statements. You should exercise caution in interpreting and relying on forward-looking statements because they involve known and unknown risks, uncertainties, and other factors which are, in some cases, beyond the Company’s control and could materially affect actual results, performance, or achievements. Among those risks, uncertainties and other factors are: the impact of changes in general economic conditions and market developments, including inflation, interest rate changes, foreign currency exchange rate fluctuations, supply chain disruptions, consumer confidence levels, changes in consumer spending, unemployment levels and depressed real estate prices resulting from the severity and duration of any downturn in the U.S. or
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global economy; the impact of recent and potential future interest rate increases on us, including our ability to successfully pursue investments in, and acquisitions of, additional properties and to obtain debt financing for such investments at attractive interest rates, or at all; risks associated with our pending and recently closed transactions, including our ability or failure to realize the anticipated benefits thereof; our dependence on our tenants at our properties, including their financial condition, results of operations, cash flows and performance, and their affiliates that serve as guarantors of the lease payments, and the negative consequences any material adverse effect on their respective businesses could have on us; our ability to obtain the financing necessary to complete any acquisitions on the terms we expect in a timely manner, or at all; the anticipated benefits of certain arrangements with certain tenants relating to our funding of "same store" capital improvements in exchange for increased rent pursuant to the terms of our agreements with such tenants, which we refer to as the Partner Property Growth Fund; our borrowers’ ability to repay their outstanding loan obligations to us; our dependence on the gaming industry; the impact of extensive regulation from gaming and other regulatory authorities; the ability of our tenants to obtain and maintain regulatory approvals in connection with the operation of our properties, or the imposition of conditions to such regulatory approvals; the possibility that our tenants may choose not to renew their lease agreements with us following the initial or subsequent terms of the leases; restrictions on our ability to sell our properties subject to our lease agreements; our tenants and any guarantors’ historical results may not be a reliable indicator of their future results; our substantial amount of indebtedness, and ability to service, refinance and otherwise fulfill our obligations under such indebtedness; our historical financial information may not be reliable indicators of our future results of operations, financial condition and cash flows; our inability to successfully pursue investments in, and acquisitions of, additional properties; the possibility that we identify significant environmental, tax, legal or other issues that materially and adversely impact the value of assets acquired or secured as collateral (or other benefits we expect to receive) in any of our pending or completed transactions; the possibility of adverse tax consequences as a result of our pending or recently completed transactions, including tax protection agreements to which we are a party; increased volatility in our stock price, including as a result of our pending or recently completed transactions; our inability to maintain our qualification for taxation as a REIT; our reliance on distributions received from our subsidiaries, including VICI OP, to make distributions to our stockholders; our ability to continue to make distributions to holders of our common stock or maintain anticipated levels of distributions over time; and competition for transaction opportunities, including from other REITs, investment companies, private equity firms and hedge funds, sovereign funds, lenders, gaming companies and other investors that may have greater resources and access to capital and a lower cost of capital or different investment parameters than us.
Although the Company believes that in making such forward-looking statements its expectations are based upon reasonable assumptions, such statements may be influenced by factors that could cause actual outcomes and results to be materially different from those projected. The Company cannot assure you that the assumptions upon which these statements are based will prove to have been correct. Additional important factors that may affect the Company’s business, results of operations and financial position are described from time to time in the Company’s Annual Report on Form 10-K for the year ended December 31, 2022, Quarterly Reports on Form 10-Q and the Company’s other filings with the Securities and Exchange Commission. The Company does not undertake any obligation to update or revise any forward-looking statement, whether as a result of new information, future events, or otherwise, except as may be required by applicable law.
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Non-GAAP Financial Measures
This press release presents Funds From Operations (“FFO”), FFO per share, Adjusted Funds From Operations (“AFFO”), AFFO per share and Adjusted EBITDA, which are not required by, or presented in accordance with, generally accepted accounting principles in the United States (“GAAP”). These are non-GAAP financial measures and should not be construed as alternatives to net income or as an indicator of operating performance (as determined in accordance with GAAP). We believe FFO, FFO per share, AFFO, AFFO per share and Adjusted EBITDA provide a meaningful perspective of the underlying operating performance of our business.
FFO is a non-GAAP financial measure that is considered a supplemental measure for the real estate industry and a supplement to GAAP measures. Consistent with the definition used by the National Association of Real Estate Investment Trusts (NAREIT), we define FFO as net income (or loss) attributable to common stockholders (computed in accordance with GAAP) excluding (i) gains (or losses) from sales of certain real estate assets, (ii) depreciation and amortization related to real estate, (iii) gains and losses from change in control, (iv) impairment write-downs of certain real estate assets and investments in entities when the impairment is directly attributable to decreases in the value of depreciable real estate held by the entity and (v) our proportionate share of such adjustments from our investment in unconsolidated affiliate.
AFFO is a non-GAAP financial measure that we use as a supplemental operating measure to evaluate our performance. We calculate our AFFO by adding or subtracting from FFO non-cash leasing and financing adjustments, non-cash change in allowance for credit losses, non-cash stock-based compensation expense, transaction costs incurred in connection with the acquisition of real estate investments, amortization of debt issuance costs and original issue discount, other non-cash interest expense, non-real estate depreciation (which is comprised of the depreciation related to our golf course operations), capital expenditures (which are comprised of additions to property, plant and equipment related to our golf course operations), impairment charges related to non-depreciable real estate, gains (or losses) on debt extinguishment and interest rate swap settlements, other gains (losses), other non-recurring non-cash transactions, our proportionate share of non-cash adjustments from our investment in unconsolidated affiliate (including the amortization of any basis differences) with respect to certain of the foregoing and non-cash adjustments attributable to non-controlling interest with respect to certain of the foregoing.
We calculate Adjusted EBITDA by adding or subtracting from AFFO contractual interest expense (including the impact of the forward-starting interest rate swaps and treasury locks) and interest income (collectively, interest expense, net), income tax expense and our proportionate share of such adjustments from our investment in unconsolidated affiliate.
These non-GAAP financial measures: (i) do not represent cash flow from operations as defined by GAAP; (ii) should not be considered as an alternative to net income as a measure of operating performance or to cash flows from operating, investing and financing activities; and (iii) are not alternatives to cash flow as a measure of liquidity. In addition, these measures should not be viewed as measures of liquidity, nor do they measure our ability to fund all of our cash needs, including our ability to make cash distributions to our stockholders, to fund capital improvements, or to make interest payments on our indebtedness. Investors are also cautioned that FFO, FFO per share, AFFO, AFFO per share and Adjusted EBITDA, as presented, may not be comparable to similarly titled measures reported by other real estate companies, including REITs, due to the fact that not all real estate companies use the same definitions. Our presentation of these measures does not replace the presentation of our financial results in accordance with GAAP.
Reconciliations of net income to FFO, FFO per share, AFFO, AFFO per share and Adjusted EBITDA are included in this release.
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VICI Properties Inc.
Consolidated Balance Sheets
(In thousands)
June 30, 2023
December 31, 2022
Assets
Real estate portfolio:
Investments in leases - sales-type, net
$
22,655,164
$
17,172,325
Investments in leases - financing receivables, net
Note: As of June 30, 2023 and December 31, 2022, our Investments in leases - sales-type, Investments in leases - financing receivables, Investments in loans and securities and Other assets (sales-type sub-leases) are net of allowance for credit losses of $711.2 million, $670.0 million, $13.5 million and $16.3 million, respectively, and $570.4 million, $726.7 million, $6.9 million and $19.8 million, respectively.
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VICI Properties Inc.
Consolidated Statement of Operations
(In thousands, except share and per share data)
Three Months Ended June 30,
Six Months Ended June 30,
2023
2022
2023
2022
Revenues
Income from sales-type leases
$
495,355
$
375,169
$
973,749
$
701,904
Income from lease financing receivables, loans and securities
373,132
261,721
744,201
334,599
Other income
18,525
15,563
36,864
23,949
Golf revenues
11,146
10,170
20,991
18,796
Total revenues
898,158
662,623
1,775,805
1,079,248
Operating expenses
General and administrative
14,920
11,782
29,925
21,248
Depreciation
887
779
1,701
1,555
Other expenses
18,525
15,563
36,864
23,949
Golf expenses
6,590
5,859
12,542
11,144
Change in allowance for credit losses
(41,355)
551,876
70,122
632,696
Transaction and acquisition expenses
777
16,664
(181)
17,419
Total operating expenses
344
602,523
150,973
708,011
Income from unconsolidated affiliate
—
15,134
1,280
15,134
Interest expense
(203,594)
(133,128)
(407,954)
(201,270)
Interest income
5,806
780
8,853
873
Other gains (losses)
3,454
—
5,417
—
Income before income taxes
703,480
(57,114)
1,232,428
185,974
Income tax expense
(1,899)
(1,027)
(2,986)
(1,427)
Net income (loss)
701,581
(58,141)
1,229,442
184,547
Less: Net (income) loss attributable to non-controlling interests
(10,879)
435
(20,000)
(1,870)
Net income (loss) attributable to common stockholders
$
690,702
$
(57,706)
$
1,209,442
$
182,677
Net income (loss) per common share
Basic
$
0.69
$
(0.06)
$
1.20
$
0.23
Diluted
$
0.69
$
(0.06)
$
1.20
$
0.23
Weighted average number of common shares outstanding
Basic
1,006,893,810
896,545,880
1,004,189,744
791,029,664
Diluted
1,007,968,422
896,545,880
1,005,879,395
793,224,837
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VICI Properties Inc.
Reconciliation of Net Income to FFO, FFO per Share, AFFO, AFFO per Share and Adjusted EBITDA
(In thousands, except share and per share data)
Three Months Ended June 30,
Six Months Ended June 30,
2023
2022
2023
2022
Net income (loss) attributable to common stockholders
$
690,702
$
(57,706)
$
1,209,442
$
182,677
Real estate depreciation
—
—
—
—
Joint venture depreciation and non-controlling interest adjustments
—
7,310
1,426
7,310
FFO attributable to common stockholders
690,702
(50,396)
1,210,868
189,987
Non-cash leasing and financing adjustments
(129,510)
(86,405)
(252,344)
(121,969)
Non-cash change in allowance for credit losses
(41,355)
551,876
70,122
632,696
Non-cash stock-based compensation
4,031
3,236
7,498
5,866
Transaction and acquisition expenses
777
16,664
(181)
17,419
Amortization of debt issuance costs and original issue discount
16,680
11,991
36,362
27,968
Other depreciation
826
749
1,609
1,495
Capital expenditures
(330)
(202)
(1,318)
(656)
(Gain) loss on extinguishment of debt and interest rate swap settlements
—
(5,405)
—
(5,405)
Other (gains) losses (1)
(3,454)
—
(5,417)
—
Joint venture non-cash adjustments and non-controlling interest adjustments
2,040
(12,058)
1,813
(11,856)
AFFO attributable to common stockholders
540,407
430,050
1,069,012
735,545
Interest expense, net
181,108
125,762
362,739
177,834
Income tax expense
1,899
1,027
2,986
1,427
Joint venture adjustments and non-controlling interest adjustments
—
7,651
(1,021)
7,651
Adjusted EBITDA attributable to common stockholders
$
723,414
$
564,490
$
1,433,716
$
922,457
Net income (loss) per common share
Basic
$
0.69
$
(0.06)
$
1.20
$
0.23
Diluted
$
0.69
$
(0.06)
$
1.20
$
0.23
FFO per common share
Basic
$
0.69
$
(0.06)
$
1.21
$
0.24
Diluted
$
0.69
$
(0.06)
$
1.20
$
0.24
Weighted average number of shares of common stock outstanding - Net Income (Loss) and FFO
Basic
1,006,893,810
896,545,880
1,004,189,744
791,029,664
Diluted
1,007,968,422
896,545,880
1,005,879,395
793,224,837
AFFO per common share
Basic
$
0.54
$
0.48
$
1.06
$
0.93
Diluted
$
0.54
$
0.48
$
1.06
$
0.93
Weighted average number of shares of common stock outstanding - AFFO
Basic
1,006,893,810
896,545,880
1,004,189,744
791,029,664
Diluted (2)
1,007,968,422
897,362,588
1,005,879,395
793,224,837
____________________
(1) Represents non-cash foreign currency remeasurement adjustments and gain on sale of land.
(2) For the three months ended June 30, 2022, the diluted weighted average number of shares of common stock outstanding in relation to AFFO is adjusted to include the dilutive effect, using the treasury stock method, of the assumed conversion of our restricted stock in the amount of 816,708 shares. For the three months ended June 30, 2022, such amounts have been excluded from the diluted weighted average number of shares of common stock in relation to net (loss) income and FFO as these were in loss positions and the effect of inclusion would have been anti-dilutive.
12
VICI Properties Inc.
Revenue Breakdown
(In thousands)
Three Months Ended June 30,
Six Months Ended June 30,
2023
2022
2023
2022
Contractual revenue from sales-type leases
Caesars Regional Master Lease (excluding Harrah's NOLA, AC, and Laughlin) & Joliet Lease
$
132,952
$
122,729
$
265,904
$
245,458
Caesars Las Vegas Master Lease
113,619
105,556
227,238
211,112
MGM Grand/Mandalay Bay Lease
77,468
—
147,390
—
The Venetian Resort Las Vegas Lease
64,375
62,500
127,500
87,798
Greektown Lease
12,957
12,830
25,787
25,660
Hard Rock Cincinnati Lease
11,176
11,010
22,352
22,020
Southern Indiana Lease
8,247
8,125
16,494
16,250
Century Master Lease
6,865
6,376
13,730
12,752
Margaritaville Lease
6,615
5,954
13,009
11,878
Income from sales-type leases non-cash adjustment (1)
61,081
40,089
114,345
68,976
Income from sales-type leases
495,355
375,169
973,749
701,904
Contractual income from lease financing receivables
MGM Master Lease
184,933
148,112
372,433
148,112
Harrah's NOLA, AC, and Laughlin
42,966
39,663
85,932
79,326
JACK Entertainment Master Lease
17,511
17,251
34,934
33,941
Mirage Lease
22,500
—
45,000
—
Gold Strike Lease
10,000
—
15,000
—
Foundation Gaming Master Lease
6,063
—
12,126
—
PURE Canadian Master Lease
4,050
—
7,859
—
Income from lease financing receivables non-cash adjustment (1)
68,462
46,319
138,039
52,985
Income from lease financing receivables
356,485
251,345
711,323
314,364
Contractual interest income
Senior Secured Notes
2,395
—
2,503
—
Senior Secured Loans
5,566
9,185
15,830
18,215
Mezzanine Loans
8,719
1,194
14,585
2,012
Income from loans non-cash adjustment (1)
(33)
(3)
(40)
8
Income from loans
16,647
10,376
32,878
20,235
Income from lease financing receivables and loans
373,132
261,721
744,201
334,599
Other income
18,525
15,563
36,864
23,949
Golf revenues
11,146
10,170
20,991
18,796
Total revenues
$
898,158
$
662,623
$
1,775,805
$
1,079,248
____________________
(1) Amounts represent non-cash adjustments to recognize revenue on an effective interest basis in accordance with GAAP.
