- »Century Casinos Reports Q2 Loss Due to Acquisitions
Century Casinos Reports Q2 Loss Due to Acquisitions
Casino owner and operator Century Casinos reported a loss for the second quarter of 2019. The company put the $565,000 loss to costs related to its plans to buy three new casinos in the United States.
Financial Report Details
Century Casinos Inc., which trades publicly as CNTY on Nasdaq, recently reported its second quarter financials for the three-month period ending June 30, 2019.
The company’s net operating revenue was $52.4 million, which was a year-on-year increase of 32%. And earnings from operations were listed as $2.6 million, an increase of 161% year-on-year.
Adjusted EBITDA is at $6.7 million, an increase of 44% year-on-year.
On the other side of the coin, the company posted a net loss of $565,000 year-on-year. This was a 278% decrease from the same period in 2018.
The loss per share was $0.02, as the book value as of June 30 was $6.14. However, shares have climbed 12% over the past full year and 20% just since January 1, 2019.
Century Casinos executives said, “We are pleased with the results of the second quarter.” They highlighted the positive adjusted EBITDA, the newly-opened Century Mile Racetrack and Casino and its solid performance thus far, and the acquisition of casinos to come.
The earnings loss of $565K was also attributed to non-recurring expenses and primarily related to the acquisition of three casinos. The deal to purchase the properties from Eldorado Resorts was announced on June 17, just weeks before the end of the quarter.
Company executives called the acquisition “transformational” and a “big milestone for Century.”
That deal to buy three casinos from Eldorado Resorts was a part of the massive gambling merger that has come into focus over the past several months. Eldorado is also in the process of buying Caesars Entertainment in a $17.3 billion deal.
Part of that process, however, included the need for Eldorado to sell some of its other properties to acquire the cash needed to buy Caesars. That was where Century Casinos came in, as it agreed to take on the operation of three casinos from Eldorado, while VICI Properties will acquire the real estate assets for $278 million
The properties are the Isle Casino Cape Girardeau in Missouri, Lady Luck Caruthersville in Missouri, and Mountaineer Casino and Racetrack in West Virginia. And the price tag on the trio of operational aspect of the casinos was $107 million. This will be financed through a new credit facility.
The deal is not due to close until early 2020, as approvals from the Missouri Gaming Commission and West Virginia Lottery will take time. There will be other closing responsibilities as well.
Canadian Century Properties
Net operating revenue for the Canadian casinos under the operational oversight of Century Casinos was positive in the second quarter and first half of 2019.
- Second quarter Canadian casinos: $21,988,000 (up $6,657,000 or 43%)
- First half Canadian casinos: $38,289,000 (up $8,285,000 or 28%)
The year-on-year increases were nearly equal to net operating revenue gains for US properties and in Poland put together.
The Canadian casinos under the Century Casinos umbrella are:
- Century Casino & Hotel Edmonton
- Century Casino St. Albert
There is also:
- Century Mile Racetrack and Casino in Edmonton
- Century Downs Racetrack and Casino in Calgary
At this time, there are two casinos in Colorado, one in Argentina, one in the UK, and seven in Poland.
Focus on Century Mile
The pride and joy of Century Casinos so far this year has been the grand opening of Century Mile Racetrack and Casino in Edmonton. This is in the Q2 financial report.
The facility is located next to the Edmonton International Airport. It boasts of a one-mile racetrack with indoor and outdoor seating, thoroughbred and standardbred racing throughout the year. Also, you can do all forms of pari-mutuel wagering.
In the casino, there are slot machines, video lottery terminals (VLTs), and even also electronic horse racing. This is in addition to food and drink options.
Originally, the facility was home to the Northlands Park Racetrack, which opened in 1900. It is one of the oldest tracks in North America. But it also needed renovations, as recent ones in 1995 and 2005 were not sufficient. So, it closed in January 2019 under the direction of Century Casinos.
Approximately $61.5 million later – more than $11 million over the original estimated cost – the new Century Mile property opened to pay homage to the history of the track. It also provides new technology and forms of entertainment for all guests.
With this Edmonton project under its belt, Century Casinos will turn its attention to its new US properties for the time being.