Operator News
Bally’s enjoys solid start to the year
By Phil - 7 May 2024
Bally’s Corp is off to a solid start in 2024, driven by revenue growth in its casinos & resorts and North America interactive segments.
Casinos & Resorts revenues rose 4.1 per cent year-over-year inclusive of the contribution from the Chicago Temporary Casino and the winding down of the Tropicana Las Vegas. Adjusted EBITDAR for the segment declined, due to the impact of weather in January and adverse hold in several markets.
Robeson Reeves, Bally’s Chief Executive Officer, commented: “While International Interactive revenues fell 4.4 per cent year-over-year in the aggregate, our core UK interactive operations grew revenues 12 per cent (seven per cent on a constant currency basis) as our strategies play out reflecting the initiatives we adopted in contemplation of the White Paper implementation in the UK. On a consolidated basis, revenues in the first quarter grew 3.3 per cent year-over-year to $618.5m.
“Furthermore, construction to the Providence Bridge in Rhode Island impacted access to our largest Casinos & Resorts profit center at Twin River, and we also saw an impact from the continued deleveraging of operations after announcing the pending shut-down of the Tropicana.
“International Interactive revenues declined by 4.4 per cent year-over-year to $234.7m, primarily driven by operations outside the UK. This reflects our strategic shift initiated last year, where we focused on maximizing profit yield instead of pursuing uneconomic growth, resulting in challenging year-over-year revenue comparisons. Importantly, Adjusted EBITDAR grew four per cent year-over-year, despite the lower prior period revenue comps, as work to optimize our marketing investments and cost structure reductions continue to boost segment profitability. In the UK, we took advantage of the uncertainties created by the White Paper and continued our online iGaming market share gains, resulting in strong revenue growth. As the year progresses, we look forward to the launch of online sports betting (OSB) in the UK to complement our iGaming offering and add another customer acquisition funnel. Outside the UK, we believe our operations in Spain are well positioned to benefit from the recent removal of advertising restrictions, which will enable us to increase our investment in faster growth. We also anticipate the further stabilization of our operations in Asia with an enhanced OSB offering to complement our existing portfolio.
“North America Interactive generated first quarter revenues of $41.5m, up 70.2 per cent year-over-year, and an Adjusted EBITDAR loss of $10.2m. Results for this segment were in-line with our expectations and reflect our guidance for 2024 segment performance targets. Importantly, our iGaming operations in New Jersey and Pennsylvania continue to gain market share. We also successfully launched iGaming in Rhode Island in early March. iGaming revenues in Rhode Island have ramped nicely through April in accordance with expectations, and we believe this momentum will continue to build through the balance of 2024.”
George Papanier, Bally’s President, added: “Our strategies to ramp operations and grow revenue at the Chicago Temporary Casino are yielding positive results, with the top-line improving month-on-month throughout the first quarter. Key drivers include the ongoing introduction of enhanced VIP amenities and improved access to the property via expanded shuttle service. We expect to build on our success with continued momentum into the spring and summer months. We are very quickly approaching July, which is when we gain control of the River North campus and can begin the development of our Chicago Permanent Casino. Beyond Chicago, we launched in-person and online sports wagering under the Bally Bet brand at our Evansville property in Indiana and announced that we will enhance our Atlantic City property through the addition of a new VIP lounge and new steakhouse concept later this summer. We remain optimistic that the margin and hold related headwinds which impacted our Casinos & Resorts portfolio in the first quarter will moderate as the year progresses, leading to margin improvement.
“Tropicana Las Vegas officially closed on April 2, and we are currently preparing the building for demolition later this year. This will allow the Las Vegas A’s to begin their stadium development and keep pace with their plans to play at their new Las Vegas stadium beginning with the 2028 Major League Baseball season. While working with the team, we continue to evaluate our development options for the remainder of the Tropicana site.”
Marcus Glover, Bally’s Chief Financial Officer, concluded, “Our financial results for the first quarter of 2024 demonstrate the strength of our diversified business segments. Bally’s operating teams remain focused on reducing expenses and enhancing operating efficiency. We are evaluating all business areas and implementing initiatives to streamline or centralize operations where it makes sense. Overall, we made progress on several of these initiatives in the first quarter and are looking forward to the promising opportunities that lie ahead.”
The company’s annual guidance remains unchanged with expectations for 2024 revenues in a range of $2.5bn to $2.7bn and Adjusted EBITDAR in a range of $655m to $695m. The full year guidance includes the impact of the Tropicana Las Vegas closure and contemplates the continued ramp of the Chicago Temporary Casino, coupled with growth in the Company’s International Interactive business, and the revenue ramp from the introduction of iGaming operations in Rhode Island.
