NEW ROYAL HOLDCO I INC. Q4 FY2023 earnings call

• Streamlined portfolio by divesting noncore businesses, reduced leverage, and returned capital to shareholders. • Completed sale of Nevada Distributed Gaming in January 2024 for ~$240 million. • Established a quarterly dividend of $0.25 per share, first payable April 4, and has over $90 million remaining for stock repurchases. • STRAT had 79% occupancy in Q4, renovated 1,300 rooms, Atomic Golf to open in March, and Super Bowl generated ~$1 million in incremental room revenues. • Laughlin saw margin stabilization in 2024 with revenue up slightly despite one less major concert. • Nevada Taverns acquired 4 new taverns, targets 3-4 additional locations in 2024, with last 8 taverns having an average ROI over 25%.

In the fourth quarter, Nevada Casino Resorts had revenue up slightly with EBITDA declining 8.8%; STRAT occupancy was 79%, up 2% y-o-y, but November EBITDA was down ~$800k due to F1. Laughlin revenue was up slightly, EBITDA down 9% due to higher labor costs. Nevada Locals Casinos had Q4 revenue down 4% and EBITDA down 10%, primarily due to reduced room nights at Arizona Charlie's Boulder. Nevada Taverns had Q4 revenue up 3% and EBITDA up 4% with 69 locations in Nevada. Nevada Distributed Gaming had Q4 revenue down meaningfully after divestitures. Total proceeds from divestitures in 2023 were over $600 million, improving leverage profile.

• Established quarterly cash dividend of $0.25 per share, first payable April 4. • Over $90 million remaining under stock repurchase authorization for opportunistic share repurchases. • Focus on organic opportunities: improved performance at STRAT, increased tavern footprint, and benefits from Nevada's economic strength. • Target to remain under 3x net leverage, focus on M&A opportunities with $50 million EBITDA north, primarily in the West with properties owning underlying real estate.

• Labor costs impacting margins. • Competition in the tavern market. • Potential disruption from construction or citywide convention changes affecting STRAT midweek occupancy.

Q: Carlo Santarelli asks about margin scenario for Nevada Casino, STRAT with room refurbishments and lapping labor expenses.

A: Charles Protell responds that margin trend is anticipated to be flat in 2024.

Q: Jordan Bender asks about M&A parameters and impact of supplier M&A on slot floor/purchasing budgets.

A: Charles Protell says focus is on $50 million EBITDA north opportunities in the West, and Blake Sartini states no impact on slot floor/purchasing budgets.

Q: Chad Beynon asks about STRAT midweek opportunities and tavern competition.

A: Blake Sartini talks about midweek improvement with Atomic Golf and taverns getting first phone calls on new sites; Charles Protell adds on STRAT midweek opportunity and tavern returns.

Q: John DeCree asks about F1 impact and STRAT near-term reinvestment.

A: Charles Protell and Blake Sartini discuss F1 improvements and STRAT near-term projects, including adjacent property plans.

Q: David Katz asks about M&A landscape change in 90 days.

A: Charles Protell says bid-ask is narrowing, financing markets improving, and REITs playing a role in M&A consolidation.