0001104659-26-052821
SEC filingQ1 2026 delivered exceptional profitability with gross profit up 38.0% to $34.9M and net income rising 38.9% to $27.6M, driven by disciplined cost controls that expanded gross margins to 25.6% despite modest 8.9% revenue growth to $136.6M.
Gross profit jumped 38.0% to $34.9 million, expanding the gross margin to 25.6%. This reflects our consistent emphasis on operating margins, measured as direct expenses—including labor, cost of product, and other operating costs—relative to net gaming, food and beverage, or hotel revenues. The profitability surge flowed through to net income, which increased 38.9% to $27.6 million, and diluted EPS, up 44.8% to $1.52. These gains demonstrate operational leverage from disciplined cost management, enabling superior bottom-line results even as revenue grew modestly.
Cash generation remained robust, with net cash provided by operating activities rising to $48.5 million. This increase stemmed primarily from higher net income, supplemented by working capital changes due to normal business fluctuations in accounts receivable, income tax receivable, and accrued expenses. Capital expenditures moderated significantly to $5.6 million from $19.8 million, yielding $43.0 million in free cash flow. Our principal liquidity sources—cash from operations and availability under the Amended Credit Facility—position us well for capital expansion projects.
We measure performance using key volume indicators like slot coin-in, table games drop, sportsbook write, and keno write, alongside covers for non-gaming areas. Management's focus on expense control supports sustained operations. We believe anticipated operating cash flows will suffice for the next twelve months to cover operations, capital plans, and authorized dividend distributions, based on current expectations for our business, strategies, and economic conditions.