<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
DATE OF REPORT (DATE OF EARLIEST EVENT REPORTED):
DECEMBER 22, 2000 (DECEMBER 8, 2000)
ANCHOR GAMING
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
NEVADA 000-23124 88-0304253
(STATE OR OTHER (COMMISSION (IRS EMPLOYER
JURISDICTION OF FILE NUMBER) IDENTIFICATION NO.)
INCORPORATION
815 PILOT ROAD, SUITE G, LAS VEGAS, NEVADA 89119
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES) (ZIP CODE)
Registrant's telephone number, including area code: (702) 896-7568
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Item 5. Other Events
Attached hereto as Exhibit 99.1, and incorporated herein by reference,
is a press release issued by Anchor Gaming on December 18, 2000 that
announces the consummation of the sale of Sunland Park Racetrack & Casino on
December 8, 2000.
Item 7. Financial Statements and Exhibits
(b) Pro forma financial information
ANCHOR GAMING
UNAUDITED PRO FORMA CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
The accompanying pro forma condensed consolidated financial statements
present pro forma information after giving effect to the stock purchase and
racetrack asset sale transactions and related financing transactions. The
stock purchase transaction and related financing transactions are described
in our Form S-4/A filed on December 5, 2000. The racetrack asset sales
include substantially all of the assets relating to Sunland Park Racetrack &
Casino and our 25% interest in Ourway Realty, LLC. The sale of our interest
in Ourway Realty, LLC has not been consummated as of the date of this report
on Form 8-K but is expected to close imminently. The operating results and
assets of Ourway Realty, LLC as of September 30, 2000 and for the periods
presented are immaterial to the stock purchase and racetrack asset sale
transactions and related financing transactions and are included as a
disposition in the accompanying statements.
These pro forma condensed consolidated financial statements are based on
our historical consolidated financial statements for the year ended June 30,
2000 and as of September 30, 2000 (unaudited) and for the quarter ended
September 30, 2000 (unaudited).
The accompanying pro forma condensed consolidated statements of income
for the year ended June 30, 2000 and for the quarter ended September 30, 2000
have been presented as if the stock purchase and racetrack asset sale
transactions and related financing transactions occurred on July 1, 1999. The
accompanying pro forma condensed consolidated balance sheet as of September
30, 2000 has been presented as if the stock purchase and racetrack asset sale
transactions and related financing transactions occurred on September 30,
2000.
The pro forma adjustments are based on currently available information and
upon assumptions that we believe are reasonable under the circumstances.
We provide the accompanying pro forma condensed consolidated financial
statements for informational purposes only. They are not necessarily
indicative of the results that will be achieved for future periods. The
accompanying pro forma condensed consolidated financial statements do not
purport to represent what our results of operations or financial position
would actually have been if the stock purchase and racetrack asset sale
transactions and related financing transactions had, in fact, occurred on
July 1, 1999 and September 30, 2000. You should read the accompanying pro
forma condensed consolidated financial statements and the related notes in
conjunction with our consolidated financial statements included in our Form
S-4/A filed on December 5, 2000. All share amounts have been adjusted to
reflect the stock split that was distributed on November 15, 2000.
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ANCHOR GAMING
PRO FORMA CONSOLIDATED BALANCE SHEET
AS OF SEPTEMBER 30, 2000
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
<TABLE>
<CAPTION>
PRO FORMA OTHER
WITHOUT ADJUSTMENTS
DISPOSITION RACETRACK AND
HISTORICAL ADJUSTMENTS ASSETS ELIMINATIONS PRO FORMA
------------ ------------ ------------ ------------ ----------
<S> <C> <C> <C> <C> <C>
Current assets:
Cash and cash equivalents $ 27,376 $ 27,376 $ 27,376
Accounts and notes receivable, net 43,262 43,262 43,262
Inventory, net 16,132 16,132 16,132
Assets held for sale 51,873 $ (51,873)(c) 0 0
Other current assets 8,947 8,947 8,947
------------ ------------ ------------ ------------ ------------
Total current assets 147,590 (51,873) 95,717 95,717
Property and equipment, net 177,473 177,473 177,473
Goodwill, net 86,113 86,113 86,113
Other intangible assets, net 43,821 43,821 43,821
Investments in unconsolidated affiliates 70,372 70,372 70,372
Other long-term assets 27,777 27,777 $ 8,000(b) 35,777
------------ ------------ ------------ ------------ ------------
Total assets $ 553,146 $ (51,873) $ 501,273 $ 8,000 $ 509,273
============ ============ ============ ============ ============
Current liabilities:
Accounts payable $ 18,852 $ 18,852 $ 18,852
Current portion of long-term debt 1,513 1,513 1,513
Income tax payable 1,840 18,500(d) 20,340 20,340
Other current liabilities 30,251 30,251 30,251
------------ ------------ ------------ ------------ ------------
Total current liabilities 52,456 18,500 70,956 70,956
------------ ------------ ------------ ------------ ------------
Long-term debt, net of current portion
and discount 201,639 (66,000)(a)(c) 135,639 $ 240,162 (a)
12,000 (b)
66,000 (a) 453,801
Minority interest in consolidated subsidiary 4,210 4,210 4,210
------------ ------------ ------------ ------------ ------------
Total liabilities and minority interest in
consolidated subsidiary 258,305 (47,500) 210,805 318,162 528,967
------------ ------------ ------------ ------------ ------------
Stockholders' equity:
Preferred stock, $.01 par value, 1,000,000
shares authorized, 0 shares issued
and outstanding -- -- --
Common stock, $.005 par value, 50,000,000
shares authorized 142 142 142
Treasury stock at cost (115,342) (115,342) (306,162)(a)
(3,126)(b) (424,630)
Additional paid-in capital 130,216 130,216 130,216
Retained earnings 279,825 14,127 (c)
(18,500)(d) 275,452 (874)(b) 274,578
------------ ------------ ------------ ------------ ------------
Total stockholders' equity (deficiency) 294,841 (4,373) 290,468 (310,162) (19,694)
------------ ------------ ------------ ------------ ------------
Total liabilities and stockholders'
equity (deficiency) $ 553,146 $ (51,873) $ 501,273 $ 8,000 $ 509,273
============ ============ ============ ============ ============
</TABLE>
See notes to pro forma consolidated balance sheet
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ANCHOR GAMING
NOTES TO PRO FORMA CONDENSED CONSOLIDATED BALANCE SHEET
SEPTEMBER 30, 2000
The accompanying pro forma condensed consolidated balance sheet reflects
the following adjustments:
(a) The repurchase of 9,192,400 outstanding shares of common stock at $33.306
per share, which was funded through new borrowings of $252.1 million and
two promissory notes totaling $66.0 million.
(b) The payment of $12.0 million transaction costs, representing (1) $3.1
million related to the repurchase of outstanding common shares, (2) $0.9
million related to the sale of assets, and (3) $8.0 million of costs
related to proceeds from new borrowings, which will be deferred and
amortized over the term of the exchange notes.
(c) The elimination of Sunland Park Racetrack & Casino historical assets and
the related deferred tax liability, which were derived from separately
maintained accounting records, and our 25% interest in Ourway Realty, LLC,
with a book value of $2.5 million. Concurrently with the sale of these
assets, the $66.0 million in two promissory notes are canceled, and
transaction costs of $0.9 million are recognized as a cost of sale of
assets.
(d) The incremental tax expense and related liability to be recognized in
conjunction with the sale of the racetrack assets.
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ANCHOR GAMING
PRO FORMA CONSOLIDATED STATEMENT OF INCOME
YEAR ENDED JUNE 30, 2000
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
<TABLE>
<CAPTION>
PRO FORMA OTHER
WITHOUT ADJUSTMENTS
DISPOSITION RACETRACK AND
HISTORICAL ADJUSTMENTS ASSETS ELIMINATIONS PRO FORMA
---------- ----------- --------- ------------ ---------
<S> <C> <C> <C> <C> <C>
Revenues:
Gaming machines $154,680 $154,680 $154,680
Gaming operations 189,938 $(45,539)(a) 144,399 144,399
Gaming systems 180,585 180,585 180,585
------- ------- ------- -------- --------
Total revenues 525,203 (45,539) 479,664 479,664
------- ------- ------- -------- --------
Costs of revenues:
Gaming machines 35,892 35,892 35,892
Gaming operations 124,529 (30,960)(a) 93,569 93,569
Gaming systems 105,083 105,083 105,083
------- ------- ------- -------- --------
Total costs of revenues 265,504 (30,960) 234,544 234,544
------- ------- ------- -------- --------
Gross margin 259,699 (14,579) 245,120 245,120
------- ------- ------- -------- --------
Other costs:
Selling, general and administrative 69,343 (4,391)(a) 64,952 64,952
Research and development 16,528 16,528 16,528
Impairment and restructuring charges 2,641 2,641 2,641
Depreciation and amorization 50,951 (3,060)(a) 47,891 47,891
------- ------- ------- -------- --------
Total other costs 139,463 (7,451) 132,012 132,012
------- ------- ------- -------- --------
Income from operations 120,236 (7,128) 113,108 113,108
------- ------- ------- -------- --------
Other income (expense):
Interest income 1,998 (59)(a) 1,939 1,939
Interest expense (16,475) (16,475) $(29,599)(b) (46,074)
Other income 2,219 (64)(a) 2,155 2,155
Minority interest in earnings of consolidated
subsidiary (608) (608) (608)
------- ------- ------- -------- --------
Total other income (expense) (12,866) (123) (12,989) (29,599) (42,588)
------- ------- ------- -------- --------
Income before provisions for income taxes 107,370 (7,251) 100,119 (29,599) 70,520
Income tax provision 42,411 (2,900)(c) 39,511 (11,840)(c) 27,671
------- ------- ------- -------- -------
Net income $64,959 $(4,351) $60,608 $(17,759) $42,849
======= ======= ======= ======== =======
Basic earnings per share $ 2.74 $ 2.56 $ 2.96
Weighted average shares outstanding 23,666 23,666 (9,192) 14,474
======= ======= ========
Diluted earnings per share $ 2.70 $ 2.52 $ 2.89
Weighted average common and common equivalent
shares outstanding 24,022 24,022 (9,192) 14,830
======= ======= ========
</TABLE>
See notes to pro forma consolidated statement of income
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ANCHOR GAMING
PRO FORMA CONSOLIDATED STATEMENT OF INCOME
THREE MONTHS ENDED SEPTEMBER 30, 2000
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
<TABLE>
<CAPTION>
PRO FORMA OTHER
WITHOUT ADJUSTMENTS
DISPOSITION RACETRACK AND
HISTORICAL ADJUSTMENTS ASSETS ELIMINATIONS PRO FORMA
---------- ----------- --------- ------------ ---------
<S> <C> <C> <C> <C> <C>
Revenues:
Gaming machines $ 47,170 $ 47,170 $ 47,170
Gaming operations 47,748 $ (11,092)(a) 36,656 36,656
Gaming systems 43,832 43,832 43,832
--------- --------- --------- ----------- ---------
Total revenues 138,750 (11,092) 127,658 127,658
--------- --------- --------- ----------- ---------
Costs of revenues:
Gaming machines 5,982 5,982 5,982
Gaming operations 31,928 (7,606)(a) 24,322 24,322
Gaming systems 30,848 30,848 30,848
--------- --------- --------- ----------- ---------
Total costs of revenues 68,758 (7,606) 61,152 61,152
--------- --------- --------- ----------- ---------
Gross margin 69,992 (3,486) 66,506 66,506
--------- --------- --------- ----------- ---------
Other costs:
Selling, general and
administrative 16,814 (1,104)(a) 15,710 15,710
Research and development 3,634 3,634 3,634
Depreciation and amortization 15,095 (723)(a) 14,372 14,372
--------- --------- --------- ----------- ---------
Total other costs 35,543 (1,827) 33,716 33,716
--------- --------- --------- ----------- ---------
Income from operations 34,449 (1,659) 32,790 32,790
--------- --------- --------- ----------- ---------
Other income (expense):
Interest income 689 (18)(a) 671 671
Interest expense (4,603) (4,603) $ (6,610)(b) (11,213)
Other income 32 (1)(a) 31 31
Minority interest in earnings
of consolidated subsidiary (256) (256) (256)
--------- --------- --------- ----------- ---------
Total other income (expense) (4,138) (19) (4,157) (6,610) (10,767)
--------- --------- --------- ----------- ---------
Income before provision for
income taxes 30,311 (1,678) 28,633 (6,610) 22,023
Income tax provision 11,973 (671)(c) 11,302 (2,644)(c) 8,658
--------- --------- --------- ----------- ---------
Income before cumulative effect
of change in accounting principle $ 18,338 $ (1,007) $ 17,331 $ (3,966) $ 13,365
========= ========= ========= =========== =========
Basic earnings per share, before
cumulative effect of change in
accounting principle $ 0.79 $ 0.75 $ 0.95
Weighted average shares outstanding 23,236 23,236 (9,192) 14,044
========= ========= =========
Diluted earnings per share, before
cumulative effect of change in
accounting principle $ 0.77 $ 0.73 $ 0.92
Weighted average common and common
equivalent shares outstanding 23,698 23,698 (9,192) 14,506
========= ========= =========
</TABLE>
See notes to pro forma consolidated statement of income
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ANCHOR GAMING
NOTES TO PRO FORMA CONDENSED CONSOLIDATED STATEMENTS OF INCOME
YEAR ENDED JUNE 30, 2000 AND QUARTER ENDED SEPTEMBER 30, 2000
The accompanying pro forma condensed consolidated statements of income
reflects the following adjustments:
(a) The elimination of Sunland Park Racetrack & Casino historical income
and expenses, which were derived from separately maintained accounting
records.
(b) To reflect additional interest expense on the notes at an effective
rate of 10% per annum, additional interest expense on our existing
senior credit facility at the current expected interest rate on these
borrowings, and the amoritization of the estimated debt issue costs on
a straight line basis over eight years. An increase in the assumed
interest rate of one-eighth percent (0.125%) with respect to total
borrowings would increase pro forma interest expense and decrease pro
forma net income by $596,000 and $358,000, respectively, for the
fiscal year ended June 30, 2000. An increase in the assumed interest
rate of one-eighth percent (0.125%) with respect to total borrowings
would increase pro forma interest expense and decrease pro forma
income before cumulative effect of change in accounting principle by
$146,000 and $87,000, respectively for the quarter ended September 30,
2000.
(c) To reflect a reduction of income taxes as a result of the pro forma
adjustments at an assumed statutory tax rate of 40%.
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(c) Exhibits
99.1 Press release dated December 18, 2000.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereto duly authorized.
Date: December 22, 2000
ANCHOR GAMING
By: /s/ GEOFFREY A. SAGE
--------------------------------
Name: Geoffrey A. Sage,
Chief Financial Officer
and Treasurer
