Monarch Resorts, owner of the Atlantis Casino Resort Spa in Reno and the Monarch Casino Black Hawk in Colorado, has set a new quarterly record for EBIDTA in its third quarter of US$20.7m with visitors spending more per visit when casinos reopened due to pent up demand.
For the 2020 third quarter, consolidated net revenue of $59.9m represented a decrease of 8.7 per cent from $65.6m in the prior year. Casino revenues increased 9.1 per cent year-over-year while food and beverage (F&B) and hotel revenues decreased 30 per cent and 33.1 per cent, respectively. Casino revenues grew as pent-up demand from guests resulted in increased spending per visit, particularly at the Atlantis, and the Company grew market share at both properties. F&B and hotel revenues declined as a result of capacity and other regulatory limitations which remain in effect in Reno and Black Hawk due to the ongoing pandemic.
John Farahi, Co-Chairman and Chief Executive Officer of Monarch, commented: “Our business continued its recovery throughout the third quarter of 2020 as we grew gaming revenue nine per cent strengthened adjusted EBITDA margins to 34.5 per cent, and delivered all-time record quarterly adjusted EBITDA of $20.7m. Third quarter net revenue declined nine per cent as capacity and other COVID-related constraints impacted visitation and our ability to offer our guests a full range of services and amenities, particularly in hotel and food and beverage. However, operating under COVID restrictions gave us an opportunity to streamline our cost structure and achieve operational efficiencies, resulting in strong adjusted EBITDA and adjusted EBITDA margin.
“At Atlantis, our increased gaming revenue was driven by strong rated guest visits and spending per visit, as well as our ability to operate a full range of casino games. We continued to increase market share to a new record, as guests responded favourably to our safety protocols. Guests also appreciated our decision to bring back, to the greatest extent possible, key amenities.
“Monarch Casino Black Hawk gaming visitation was also strong throughout the third quarter, but revenue was negatively impacted by the lack of table games, for which the state-mandated closure was lifted on September 11th. Looking ahead, we are eagerly anticipating the ballot result of Amendment 77 to the Colorado Constitution on November 3, 2020, which would allow the city of Black Hawk to increase the $100 bet limit and approve new games such as Baccarat and Pai-Gow Tiles. If Amendment 77 passes, those changes could take effect as early as May 1, 2021 and would have a material positive impact on our gaming revenue at Monarch Casino Resort Black Hawk.
“We are nearing the finish line of our construction project in Black Hawk. We anticipate opening the expanded Monarch Casino Resort Spa Black Hawk in the fourth quarter of 2020, with operations ramping up throughout 2021. We are confident that the expanded casino, new hotel and enhanced amenities will be received very favourably by our guests.”
“As always, we are dedicated to providing guests with the unmatched service they have come to expect at a Monarch property. Despite the challenges faced in 2020, our operational execution was solid and it demonstrated the competence, dedication and sacrifice of the entire Monarch team. Our guests have been extraordinarily patient and loyal as we navigate the ever-changing operating environment since our properties re-opened.
“During the quarter, we amended and increased the principal amount of our credit facility. We believe that our strong balance sheet positions Monarch for future growth and will allow us to take advantage of acquisition opportunities as they present themselves.”