Canada – Century Casinos sees 2020 revenues rise with addition of three casinosBy Phil - 12 March 2021
The addition of revenues from three casinos bought in 2019 helped boost results by 26 per cent for Century Casinos for the three months and year ended December 31, 2020.
The company’s 2020 results were significantly impacted by the acquisition of Mountaineer Casino, Racetrack & Resort, Century Casino Cape Girardeau and Century Casino Caruthersville in December 2019.
Net operating revenue was $84.8m, an increase of 26 per cent from the three months ended December 31, 2019.
Despite the temporary closures of the company’s facilities throughout 2020 due to the worldwide coronavirus, operating revenue for the year was up 39 per cent to $304.3m.
Erwin Haitzmann and Peter Hoetzinger, Co-Chief Executive Officers of Century Casinos, said: “We are pleased with the strong Adjusted EBITDA for the fourth quarter even though our casinos in Canada and Poland were closed in December over the busy holiday season. These results were driven primarily by our properties in the US, which generated 82 per cent of our Adjusted EBITDA in the fourth quarter. We have been able to achieve operating margins that we believe will continue to be attainable. We look forward to our casinos and racetracks reopening in Canada and to a busy summer season in North America if the pandemic subsides.”
Century estimates that the closures during the first and second quarters of 2020 adversely impacted net operating revenue and Adjusted EBITDA by approximately $91.3 million and $34.3m, respectively, and that the closures in Canada and Poland in December 2020 adversely impacted fourth quarter net operating revenue and Adjusted EBITDA by approximately $9.2m and $1.7m, respectively.
On December 1, 2020, Century sold the casino operations of Century Casino Calgary. The Company recorded a gain on sale of casino operations of $6.5m in the fourth quarter of 2020. The company continues to own the underlying real estate, which it leases to the casino operator, and operates Century Sports, a sports bar, bowling and entertainment facility located on the property. The Company intends to sell the real estate in 2021.
The company’s casinos have varied their operations based on the governmental health and safety requirements in the jurisdictions in which they are located. These include capacity and gaming floor restrictions and limited hours of operation. Such closures have had and will continue to have a material impact on the Company. The company cannot predict whether future casino closures will be required.
The company continues to monitor its liquidity in light of the uncertainty resulting from COVID-19. It plans to continue to reduce marketing and operating expenditures where possible. Its 2021 planned capital expenditure projects will be evaluated throughout the year and postponed to 2022 if necessary and permitted under its agreements. In March 2020, as a proactive measure to increase its cash position and preserve financial flexibility, the Company borrowed an additional $9.95m on its revolving credit facility under its credit facility with Macquarie Capital and $7.4 million on its credit agreement with UniCredit Bank Austria. The Revolving Facility was repaid in July 2020 except for a $50,000 letter of credit that the Company cash collateralised.