Dan Lee - President and CEO Lewis Fanger - SVP and CFO.

Good day and welcome to the Full House Resorts’ Fourth Quarter 2015 Earnings Call. Today’s conference is being recorded. At this time, I would like to turn the conference over to Lewis Fanger, Chief Financial Officer of Full House Resorts. You may begin..

Thank you, good afternoon everyone. Welcome to our fourth quarter 2015 earnings call. Before we begin, I need to remind you that today's conference call contains forward-looking statements that we're making under the Safe Harbor provision of federal security laws.

I would also like to caution you that the Company's actual results could different materially from the anticipated results in these forward-looking statements.

Please see today's press release under the caption forward-looking statements for the discussion of risks that may affect our results, and also we're broadcasting this conference call live on fullhouseresorts.com. We can also find the earnings release that we circulated earlier today. And with that all said, let's kick it off..

Hi, this is Dan Lee, I am the CEO and we had another good quarter, really good quarter, this case, ending now what turned out to be a pretty year.

The -- led first by the Silver Slipper which had a hotel this year that it didn't have the last year, a hotel it opened in stages between May and September and was the main driver in the results being up but it recognized, the Silver Slipper was up from the first part of the year too, but the year-over-year increase accelerated when the hotel opened and so we ended up 43% in income or EBITDA I should say in the quarter.

For the year, it was up 32% and as you can imagine the comparisons in the first half of this year are easy because we didn't have the hotel last year and so we probably will have pretty good quarters next couple of quarters and then we'll lap when the hotel opened and I think that property ended the year with almost $10 million of EBITDA up from 7.5, but the run rate is more closer to 11 or 12 with that hotel.

And so that's our most important property and it did quite well.

The Rising Star, I am happy to say had a strongly up quarter it is first time you could say that in many-many years that Rising Star as you know have been impacted from competition of new casinos in Ohio, and other casinos in Indiana that were closer to where people lived to where they had to cross the river.

And finally got down to where EBITDA was only a couple of million dollars in 2014 and that bottomed out in 2015 and then we ended the year on a high note with a promotion where we branded it as the Christmas casino and actually removed slot machines and put in waving teddy bears and stuff like that.

And the promotion worked really well, we had live reindeer people could come and see and so on and so even after we had invested a little more than 400,000 in that stuff and the uniforms which were 100,000 that got expensed right away and the decorations which of course we own we literally hired the guy who did the store of windows for Macy’s in Manhattan.

And so we have these little vignettes that have motorized teddy bears and cherries and stuff, the cost of that gets amortized over three years, but in effect all of that stuff, forget GAAP accounting for a moment, we spent a little more north 400,000 and probably paid for it just in the month of November and then December was also strong.

Using GAAP accounting EBITDA swung from loss last year in this seasonally slow quarter of 322,000 to a profit this year of 750,000. And so we ended the year with EBITDA of about 4 million versus 2.2.

The 4 million however did include a tax issue where we had resolved a longstanding tax dispute with the town and now have got a tax rebate of 1.3 million and that was taxes we had previously expensed GAAP required that to come back through as income and so this part of that adjusted EBITDA, but then going forward our annual real estate taxes are about $0.5 million less than they were previously.

So the 4 million that we ended up with for the year, if you adjust through all that tax stuff, it was really in the low 3s like 3.2-3.3, which still compares extremely well to the 2.2 million that we had in 2014.

Perhaps most importantly is it kind of showed that even though we have the oldest casino in the region and geographically perhaps the most challenged, if we do good promotions and think out of the box and do creative stuff, the customers do respond and we can make good money and so we're pretty optimistic about this property improving.

Now it will never get back to the 50 million a year abate in the 1990s we don't even do 50 million a year in gaming revenue and I'm not sure it will get back to the 10 million a year that it did five years ago. But it can get back to 5 million or 6 million a year with the right promotion and the right things.

And kind of commensurate with that is we have bought land in Kentucky and are working towards the entitlements to operate a ferry service over to Kentucky and we're looking at some other things we can do with the property were really modest investments, we'd have a pretty quick payback just to give you an example, we had some parking lots there that haven't been used in like ten years and for about $1 million, we can convert one of those parking lots into a 50 space RV park and the payback on that's probably about two years, we operate an RV park down at the Silver Slipper and so it wouldn't be hard to put one here.

And so there is little things like that that we're looking at, but Rising Star is actually a Rising Star at the moment, and we're happy to have to kind of turn that trend. In Northern Nevada, in the year number we ended up with 3.9 million versus 4.5 million.

The big part of that was terrible ski season last year and so the first quarter of last year was a pretty poor number for that property. And then in -- we also at the Hyatt Tahoe, we're at summer seasonal, summer is the most important season and it had a lower than normal win percentage in the peak season, so it was kind of a double win.

In the fourth quarter Hyatt Tahoe did fine find in effect of ski season there has turned out to be a very good ski season, which will be reflected mostly in the first quarter, but in the fourth quarter in Fallon, we opted to change the carpet in the casino and move some of the slot machines around and actually we moved some slot machines, so we had better sidelines and so on, which seems to be working nicely for us here in the first quarter but in the fourth quarter there was a couple of weeks where there was some disruption there, casinos were torn apart and so Fallon had kind of a weak fourth quarter, really because of those two weeks more than anything else.

So, I think Northern Nevada ended up the year almost flat but down -- ended up the quarter almost flat but down a little and ended up the year down about 13% and really the down 13% was the ski season and a little bit of win percentage. And going forward, I think Northern Nevada will probably have good comparisons going forward.

Corporate, in last year's corporate expense of 1.4 million there were a whole bunch of severance payments and cost associated with the change of the Board and the new management coming in, this year's fourth quarter was pretty normal number of 881..

No, no, no Dan we closed -- we haven’t separated it on a different line item, but the 14 last year did have 600,000 bucks for the stock equity offering right..

That's right, [Multiple Speakers] that is an uptake number okay with the prepared -- the prior management have prepared a prospectus to try to issue equity and it wasn't used and had been capitalized, we wrote that off, that's right, you are right the Board changes around the line further down.

But our corporate expense for the year ended up at 3.8 and that's probably about where it runs the net ballpark and you can see the 900,000 in the fourth quarter is kind of commensurate with that. Guess that's it operationally, and now the main thing is I'm sure everybody's wondering about Cripple Creek.

We have an agreement to acquire Bronco Billy's at Cripple Creek for $30 million, we have a license now in Colorado, we had intended to refinance all of our debt in the term loan B market which is kind of a subset of the high yield market, but between the time we signed that deal in September and when we were ready to try to issue the bonds once we are licensed, the high yield bond market has fallen apart and it really wasn't economical if it even could get done.

And so we've gone back to our normal lenders and the most important two of which have stepped up and are willing to work with us and now we're working with some of the smaller banks to pull it together and get it done.

So we're still confident that we can get this done, but it has taken us longer than we thought, and I think it'll end up being our existing lenders stepping up some of them in bigger size in order to refinance our existing debt and provide the $30 million to close that transaction and we're targeting the first part of April to get that done, and so we still I believe we can get this done of course there's no certainty that we can and if we don’t we lose our $2.5 million deposit.

We have until May 18th under the agreement and it's kind of a drop dead date. You do need, I'm sorry 14, May 14th. We do need Indiana’s approval and they won’t approve it until they see the final loan documentation.

And so is a little bit of a catch 22, so we need to get the lenders lined up, get the loan documentation done, get Indiana to approve it and then we can close the deal.

And so we hope to do that in the next three weeks or so, and at that point when you think about it, we'll have, we have about 65 million in total debt today with the cost of refinancing all that debt and everything we would end up with about 100 million of debt.

Our EBITDA this past year was 14 million with the full year of the hotel in Mississippi our run rate is at least 14 million even if you back up the real estate tax thing out of Rising Star, and then you add Bronco Billy's on, we end up at about $20 million of kind of run rate EBITDA so we're levered about five times, that's actually not that much levered, there's quite a few casino companies more levered than that and of course we’ll be more diverse than we are today by having Cripple Creek and so we're pretty sure we can get this done.

Just it's been not a good debt market the last few months so it's been complicated but I do think we'll get there and then we're five times levered and senior debt of about 2.5 times should be doable. And frankly everything is turning positively at this point.

Every property we have is trending positively and so it -- I think we're in pretty good shape there. In Indianapolis it has been kind of interesting, you recall we responded last August to a request for proposals that the airport had put out.

They have a piece of land where the old airport terminal had been, they were looking for proposals on the land, we have kind of a hidden asset, we're allowed to have almost 2,000 gaming possessions in the state that's twice what we need in Rising Sun, so we've said, well if you let us relocate gaming possessions we'll undertake a large development there probably with partners and it would include a lifestyle retail community and theatres and skating rinks and all that and anchored by a smallish casino, now that would take legislative approval which is not going to be an easy battle, the company that owns the two race tracks on the east side of Indianapolis enjoys their monopoly and will not want us to be on the west side of Indianapolis.

And they've had a lot of political power in the state for a lot of years. But nevertheless we've put out the proposal and I have declared pretty clear with everybody it is kind of a long shot.

The airport authority came out about a month ago and said they were favouring a different proposal which was called ABN and it stands for Athletes Business Network, who was going to build a kind of small office complex, a couple of hotels and a big stadium.

But we were proposing to pay 5 million a year rent to the airport and then our facility would have generated 85 million of state and local taxes. The ABN proposal was going to pay I think $350,000 a year rent for the same land, and when they built all their phases they'd get up to a million a year rent.

So economically it wasn’t anywhere close to our proposal. They needed a bunch of entitlements but they did not need legislative approval. So the airport I think for lots of reasons it kind of said, well we are going to favour ABN because we don’t know if they will get a casino through the legislature.

But we looked at how in expensive the ABN deal was and kind of said wow if they are going to give up this great piece of land for something that cheap, let's look at this may be we can get a mall developer to agree to build the mall and whether we get a casino or not but we can kind of get the right to put a casino there someday and just get a mall developer to build the mall and we have done a study that shows that a retail mall would work pretty well there.

And so we wanted to the law in Indiana quite honestly those with the public agency does something like this, they are supposed to publicize each of the proposals they have including their analysis of those proposals, have a public hearing on each and then give each proponent a chance to do a last and final offer and they never did that.

So we sent them a letter saying you are not following the law here and you need to give us a chance to do last and final offer, and that kind of hit the newspaper that we had sent that letter and the airport authority, I guess hired lawyers and there was a new mayor there who is not the person who that the mayor appoints over half the board members, but the new mayor is not the mayor who appointed these board members he is from a different local party and so I think the airport kind of reconsidered what they were doing and they announced on Friday last week that they were cancelling the RFP process which they really kind of had to do because they weren’t following the law with it and they are still interested in trying to figure out the highest and best use for this land put it back into -- on the tax rolls and see if they developed and of course we’re still interested in trying to do something on that piece of land, so it is not like we were chosen but the deal they were leaning to chose also was not chosen and I think the airport has to go back to square one and figure out what to do.

And so still kind of a long shot but it's -- we're not necessarily tied to that piece of land there is this basic concept here that we have more casino capacity permitted casino capacity at Rising Sun than we really need for the Rising Sun market, and so we are going to continue to pursue that idea to say look it's better for the state of Indiana if we can relocate slot machines from our warehouse literally slot machines that aren’t being used and are sitting a warehouse to somewhere else in the state where the state can make more money on it and we can make money on it, and we love that airport site but there is a lot of land in the state of Indiana and has lot of markets where there is no now and we will continue to look at that now of course anything takes approval to legislature even if we wanted to move our boat five miles we can take approval legislature and so I think it will be a big topic in next year's Indiana legislature and so that's the whole story in Indianapolis.

Anything else I am missing loose..

Yes, I feel like a lot has happened since we talked to you last, just wanted to highlight really quickly we did execute that fixed amendment to our First Lien credit agreement and we did on large part because of the volatility that was going on at the start of the year and the capital markets and so that effectively pushes out the maturity date for our First Lien debt until April 2017 on....

And we did that because we didn’t want it to become a current liability in our 10-K..

That is true.

We also on Friday announced at Rising Star that we amended the hotel lease that we have over there and so if you recall we have got two hotels on site one is connected to the fiscal plant and the other is slightly further away, it's called The Lodge at Rising Star and so what we did was we amended our hotel lease that goes out four extra years, the interest rate on that's about 4.5% and so effectively what we get over the next four years is a reduction in our lease payments $5 million and what we will do with that million dollars is reinvest that into some of the ideas that Dab mentioned already so we are looking at some new restaurant comps such as well as a ferry boat over into the Kentucky side..

And then frankly to give you the back story we had gone to the town and so that lease is from a charitable foundation it's kind of a -- it's a form of financing and we weren’t here when it was done I am guessing they were trying to make it off balance sheet financing and ultimately it ended up being capitalized, but it is a lease to our subsidiaries not guaranteed by the parent.

And the money was used to build that hotel we leased that hotel at the end of the lease we have the right to buy that hotel for $1. If we don’t exercise that right the charitable foundation has the right to put it to us for $1. So it's pretty likely we are going to own this hotel at the end of the lease.

So the right way to think of it is, it's really just kind of inexpensive financing and the interest rate peaks at 4.5% it is kind of retching up towards it gradually.

And so we had gone to the town and said look that we are biggest employer in town we are the biggest tax payor in town, our futures are linked hand and glove if we're successful the town would be successful.

The Christmas casino kind of showed that things can work, but could the town possibly help us out here if we're going to put some CapEx into this with the town delay some of the principal payments on the lease or the charitable foundation which was somewhat linked to town.

And after much discussion, they agreed to do that, now we have to put that million dollars into the property but it's $1 million deferral of principal payments and so it's another way to think of it is, it's inexpensive loan to the subsidiary to help fund some of this CapEx that we're looking at doing there and we're very appreciative of that from the town it is obviously a good thing for shareholders and it is also a good thing for the town.

And I would say if you look at our properties by the way and most of you probably haven't seen them but the Silver Slipper in good shape, I mean it's been well maintained, and we've brought it recently the Hotel's brand new. The casino is in good shape the restaurant in good shape.

The Cowan property is pretty beat up and old needs some help but it's really small that would take a lot of money to move the needle there and make it nicer.

The Hyatt Tahoe is under a lease that was due to expire in February 18th, that's right a good sense -- since last time we did this call, we amended that lease with the Hyatt folks where had a five year extension of the lease and we're going to work with Hyatt to do a renovation of the casino.

The hotel is the nicest hotel in Northern Nevada, it's a very nice hotel right on the short line of Lake Tahoe and they have put a lot of money into the hotel.

The casino itself had not really been renovated in probably 10 years and it's nice, but it didn’t quite live up to the rest of the hotel and what's more is like the leading property in Northern Nevada for a long time was here as Tahoe and that is where all the high rollers would go and everything and of course there in bankruptcy and that property is a little real tired and so this was a chance for us to steal some of that higher end business if we would upgrade the casino some so Hyatt actually owns the property and they indicated they would agreed to put it 3.5 million in renovating the room if you will the walls and floors and cupboard and stuff.

And we will put a 1.5 million into the gaming equipment so it ends up being a total of $5 million going into this room which is only about 20,000 square feet, so that's enough to kind of move the needle and really make it a nice casino.

We're starting the design process now and we expect to do the construction after this peak ends a year from now so April, May-June, next year and we will close the casino, we'll do it in stages so the Casino always remains open, but in those months we don’t' need the full room because business is pretty slow in those months.

And then by the time we get to 4th of July we will open a new beautiful casino.

And so and then Hyatt has under the existing lease the right to buy us out by paying for the fair market value of our assets which led the gaming equipment and stuff like that, plus one year’s EBITDA and they agreed to not exercise that right until 2019 and of course the 1.5 million that we're putting into the gaming equipment increases their cost of exercising that right.

I think as a practical matter, we have a good relationship with Hyatt. They don't really want to run this casino, they used and they ran the casino business and then the Pritzker family made a decision to get out of the casino businesses.

I think impart because they're a very complicated family, private family and probably didn't really relish the whole gaming license process.

And so that's probably the biggest impediment if they wanted to take over the casino run it themselves not only would they have to write a check to us but they’d have to go get it licensed and they're big enough and complicated enough that the cost of doing that's pretty significant.

So I think they always keep the right to buy us out because if they sold, if they were to sell the property to somebody else who wanted to get a license that would be important to the buyer or if there were selling Hyatt itself to somebody who wanted to get a license that might be important.

So I think they always try to keep that option and we asked them to give it up of course and they didn’t want to give it up.

And -- but they were willing to delay the period of time where they can exercise it, so we can get a return on our money, but I think as a practical matter hopefully we're in that property that for the long-term it is a very nice property, and we I think run it well and I think we get along well with the Hyatt folks.

And so anyway talking about the quality and then Cripple Creek is in pretty shape and I mean nice restaurants nice casino recently expanded and so on, and so if you were to look across our property the Silver Slipper and Cripple Creek are in good shape.

Hyatt Tahoe has a planned renovation coming and really most of the places where we can move the needle with a little bit of CapEx as at Rising Star which is a big property they have been kind of neglected and by doing kind of some creative stuff here and there, I think we can actually get a pretty high return just because it's a fairly large property operating at close to breakeven.

So if you can bring in a little more revenue, it falls quickly to the bottom-line and you saw that with the Christmas Casino thing, and that's how I think we get back to 5 million or 6 million a year of EBITDA.

I missed anything else Lewis?.

No you are still on last point Dan..

Okay..

We'll open up to questions but I'll just brag really quick because we don't do it very often, this was a really good quarter, a very good first year, we are up almost $4 million in EBITDA versus a year ago and we think there's more to give to you guys, so with that, let's do some Q&A..

Okay..

Thank you. [Operator Instructions].

There are a lot of you on the phone, you guys are cited. Okay, here comes a question, yes..

Okay..

And we'll take our first question from Jane Whorwood from Global..

A question for you, as you look to the refinancing and some of those EBITDA projections going forward, maybe you can give us some sense of some range of what you think the interest rate shakes out to be blended all in?.

Honestly, I think it's going to be kind of expensive. Right now, we have two tiers of first lien and second lien, first lien is inexpensive, secondly lien is expensive.

To get this done, we're going to be increased in the size of the second lien so the bad news is I think, it's expensive but at least we get the deal done, the good news is we're trying to structure it in a way that we can refinance it to lower interest rates maybe as soon as two years from now or something.

with modest call premiums and penalties that -- let me put it in perspective, I think, if we invest our free cash flow or a really modest investments like we are taking about the ferry boat and so on, we can get to 25 million of EBITDA by 2018-2019 and without increasing the debt, if we're at 25 million of EBITDA and 100 million at debt when we levered four times and there is a world of difference in the -- there was a big difference in the debt markets between levered five times and four times, if were only levered four times, I think we'd be borrowing money much cheaper.

Now the debt markets the windows open and close, we ended up to trying to close on this transaction at a time, when the high yield market is not healthy, it's strengthened a little bit the last few weeks, but still pretty week and so with -- so we're trying to set it up, we don't want to lose the $2.5 million deposit, we do want to close on the deal, we think that Bronco Billy’s is a great asset to add to the portfolio and we're just going to end up paying what we have to pay to get the deal done and it doesn’t mean we're not negotiating, there is all sorts of negotiating going on but I think you should anticipate, it being expensive and the financing and then the hope is that in maybe 2018, we can refinance to the much lower interest rate..

Yes, and keep in mind that first lien does bring that average cost down and Dan is right on the second lien, but if we could hit a number in the high single-digits for a blended cost we'd be happy..

The guys art Summit, it was our second lien vendor, they're expensive but they're good guys and they're smart they understand the business. So, they actually have been pretty helpful on this and -- but they're expensive..

Can you talk about the CapEx requirements at Bronco Billy’s perhaps there are other interesting projects that you could do with that property to get their EBITDA up as well?.

Yes, they have historically spent around 700,000 or 800,000 a year mostly on slot machines they keep their slot product in pretty good shape, probably better than we have as a company at the other properties.

And I think, maintenance CapEx including maintaining the quality of a smart product is something similar on that property, but they have quite a bit of land around them there and this was a small town, I know it's like 40 acres but there is enough land around them to add a hotel and if you were to look at Black Hawk Colorado which is an hour west of Denver, the Black Hawk has gone through a growth phase in the last five or six years, where people added hotel rooms, so that you can drive out from Denver and stay the night or stay the weekend and that has caused a pretty nice surge in the gaming revenues and profitability of the casinos in Black Hawk, well what Black Hawk is to Denver, Cripple Creek is to Colorado Springs now, Cripple Creek is smaller and Colorado Springs is smaller but it is very much the same relationship, we're in the mountains an hour west of Colorado Springs but Cripple Creek has not gone through that same phase of having a better hotel product, there are hotels in Cripple Creek but they are relatively limited in both number of guest rooms and the quality.

And in fact a couple of trips ago, our hotel was filled and I ended up staying at -- and we only have 14 rooms, and they're on the roof of our casino, and they're okay but they're not the quality of say the Ameristar property in Blackhawk.

And so I ended up staying at one of the larger and thought to be one of the better other hotels in town, and it was fine. But it was the hospital built for Irish miners back 100 years ago and you're going to bed just wondering how many people have died in this room.

And so I think there's an opportunity here and I understand Century Casinos which is another public company, they have a casino right across the street from Bronco Billy's, they're a little smaller than Bronco Billy's and there they announced they're building a 30 room hotel on the land they own.

Well where they're building their 30 room hotel is directly across the street from where we would look to build a hotel that might have 100 rooms. But that's always down the road, that's probably a $20 million CapEx project.

Probably generates 4 million a year of income, is kind of what we think and would take Bronco Billy's from 5 million a year to 9 million a year. Now we have to close this deal first and then somewhere down the road figure out how we finance another $20 million hotel. We don't have the ability to do that right now.

But that is certainly one of the enticements of acquiring Bronco Billy's is there is a pretty good growth opportunity by adding a hotel to the property..

If you've time for one more, I was just curious for having been in the business a very long time you could comment on how the casino industry will attract or continue to attract younger millennial gamblers.

How do you stay relevant in changing times, what do you do, is it an issue?.

I don't really think it's an issue, quite honestly. The -- first off the slot machines evolve overtime and the table games also evolve overtime so you have all sorts of variations now of craps and blackjack and so on.

John what was the game, we introduced a new type of craps game, oh the crap was craps, okay and it turns out to be popular because you can't crap out on your first roll up, the end of it, and that was at Rising Sun we had it out there, but it tweaked other rules and at the end of the day the house edge is about the same and it's about the where you have Caribbean stud blackjack, poker, Caribbean stud poker.

You have many background now which is popular, if you're looking at slot machines, I mean now you get slot machines with all sorts of stuff, we have an Ellen Degeneres slot machine I saw it the other day that are coming out. So these things evolve, but I think the basic customers are always going to be older.

You know we sell adrenalin, that's what we sell, we sell adrenalin and everybody's a little bit addicted to adrenalin, there's some gland in your, I think it's your pituitary gland that something pleases you and you get this little shot of adrenalin and you think that feels nice, and there's so many and that's what we're selling, that's the whole experience is people do that.

And they'll sit there and play the slot machine, lose, lose, lose, lose, lose and then they get a jackpot and they get this little pleasure thing and they say that's nice, and to that extent it's very much like fishing.

You know you go fishing you go buy a $10,000 boat, you schlep it somewhere and you buy worms for like $5 a pint and you go out there in the freezing rain and stuff I used to do with my dad all the time.

You'd sit there at the wee hours of the morning and eventually a fish bites on the line and you have 30 seconds of life and death struggle it is not your life and death, only the fish's life and death and when you finally pull the thing in if you keep it and many times you don't, you're going to take the hook out of it and throw it back on, but you take it home you will have spent 100 times what it would have cost you to go down to Whole Foods and buy that same fish.

And you're not doing it to eat the fish, you're doing it for that adrenalin, or you'll play golf, like if I break 100 I'm having a really good day at the golf course but I'll remember the three or four good shots that I had and so what happens is when you're in your 20s you're getting your adrenalin rush by you know you're dating and it’s some new girl and she smiles at you and when you're in your 30s it’s your kids, when you take them to Disneyworld and they smile at Mickey Mouse and your heart melts and at that point you know in your 20s you're paying off your student loans, in your 30s you got a home mortgage and a car mortgage, in your 40s you're thinking about putting your kids through college, in your 50s it starts to shift and I am in my 50s and your income is now peaking your kids are hopefully through college and your mortgage is probably paid off, you're still addicted to adrenalin but now you're worried about blowing out your knees again on that double black diamond ski run or something, right, and so the stuff that you did when you were younger that gave you the adrenalin rush is bothering you a little bit now and you're go into that casino and you sit down at the blackjack table and $5 a hand is not exciting to you because you're making too much money and you start thinking for this to get me an adrenalin rush I need to make some money that would really affect that right and so you're putting down you know $25 a hand or $100 a hand and because that's what gets your attention that is what has you excited.

And so or maybe you are sitting at that -- we have slot machines that are $100 slot machines and it will take five coins and I have a brother though who goes and plays this all the time and I am looking and I am like Tselios do you know what you are doing I mean it is a slot machine right and he is doing $500 a handle pull he is banging at the thing well Tselios owes a very successful business and he has got lots of money and he does fine, but it's not exciting for him to play a slot machine at a dollar a hand so he plays what is exciting to him, well for us that's the most important customer.

Well then when you get into your late 60s now you are retiring and you are on fixed income and you are starting to wonder would my network last longer than my life will and you get conservative again so that -- those passages in life I think more than anything else are what causes our prime customers to be in their 60s, 50s and 60s and so I could worry about the post World War II baby boom getting older and dying that's -- but I'm not really worried about whether millennials will gamble I think as they get older they too will gamble as their parents did and as their grandparents did..

Great answer, thank you very much for that and congrats again on a very successful year the turnaround progresses very nicely..

[Operator Instructions] And as we have no additional questions at this time, I will turn the call back over to Dan for any additional or closing remarks..

Sure I would have promised to answer it faster than I answered the last question, anyway anything else Lewis?.

I am good Danny you want to close it out?.

Well. Thank you very much everybody and first quarter is looking good and we will just keep plugging away so. Thank you..

That does conclude today's conference. Thank you for your participation..