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US – Full House to open Waukegan casino in three months

By - 8 November 2022

Full House Resorts third quarter results dipped to $41.4m from $47.2m in the prior-year period, although the operator was buoyant over construction updates for two major new casinos.

“We continue to make progress on our two new casinos, with the first of them on the verge of opening,” said Daniel R. Lee, President and Chief Executive Officer of Full House Resorts. “In Waukegan, Illinois, we are installing décor and are preparing for the installation of slot machines this week. We expect to have our entire slot floor installed and ready for testing before the end of November. The testing of the slot machines, surveillance systems and other technology is a complicated process. Imagine connecting 1,000 slot machines, from several different manufacturers, through many miles of low-voltage wiring to central servers — and ensuring that every machine operates flawlessly. This process usually takes several weeks and is the principal uncertainty in our opening date. Our hiring process is ramping up, with approximately 400 outstanding offers already made. As with all new casino openings, we have an extensive checklist to complete prior to welcoming our first customers. Therefore, while the Company expects to open the casino within the next three months, the precise opening date is still uncertain. When The Temporary opens, it will be the only casino in Lake County, Illinois, which has a population of approximately 700,000 and ranks as one of the wealthiest counties in the U.S.

“At our Chamonix project in Cripple Creek, Colorado, construction reached its ‘topping off’ milestone back in September,” continued Mr. Lee. “Chamonix’s construction continues at a meaningful pace, with glass now being installed on the façade and drywall within the building. When complete, Chamonix will be one of the larger casino hotels in Colorado and the largest and most luxurious casino hotel in Cripple Creek, which is the primary casino destination for the Colorado Springs market. Cripple Creek is approximately one hour from the roughly one million people who live in the Colorado Springs metropolitan area and two hours from the approximately four million people who reside in the Denver area.”

For project renderings and live construction webcams, please visit www.AmericanPlace.com and www.ChamonixCO.com.

“Our anticipated investments in both of these growth projects remain within budgets,” added Lewis Fanger, the Company’s Chief Financial Officer. “Importantly in these difficult capital markets, we remain confident that our cash balances, cash flows from operations, and credit line availability will be sufficient to complete both The Temporary and Chamonix. At September 30, 2022, we had $241.8m of cash, including $156.1m of cash that is reserved for the completion of Chamonix. We also have a $40m credit facility, which remains undrawn.”

In Mississippi, Silver Slipper Casino and Hotel’s revenues were $20m in the third quarter of 2022, versus $21.5m in the prior-year period. The prior-year period was one of the best quarters in the property’s history, having benefited from the distribution of government stimulus checks, and thus making for a difficult comparison. The revenue decline also reflects the competitive launch of online sports wagering within nearby Louisiana that started in January 2022, with the property’s on-site sports wagering revenues declining by $0.3 million in the third quarter of 2022.

In Indiana, Rising Star Casino Resort’s revenues were $9.6m in the third quarter of 2022, compared to $12.6m in the third quarter of 2021. The decrease was primarily due to the timing of Rising Star’s annual sale of “free play,” which resulted in $2.1mof revenue and income in the prior-year’s third quarter. This year, Rising Star sold its “free play,” also for $2.1m, during the second quarter. Additionally, a competitor with historical racing machines opened in September 2022.

The Colorado gaming market, including Cripple Creek, has shown significant growth since betting limits were eliminated in May 2021. Bronco Billy’s, however, has incurred significant construction disruption, including temporarily-reduced gaming and restaurant capacity and the temporary absence of all on-site hotel rooms and on-site self-parking. To alleviate the lack of on-site parking, Bronco Billy’s currently offers complimentary valet parking and a free shuttle service to an off-site parking lot, both of which result in increased operating expenses.

When Chamonix opens in mid-2023, Bronco Billy’s will share the significant on-site parking garage, valet and surface parking capacity of the new casino, and also benefit from Chamonix’s adjoining 300-guestroom hotel.

In Nevada, the company owns Grand Lodge Casino, which is located within the Hyatt Regency Lake Tahoe luxury resort in Incline Village, and Stockman’s Casino, which is located in Fallon, Nevada. Revenues were $6.3m in the third quarter of 2022, a 22.6 per cent increase from $5.1m in the prior-year period.

The company also operates sports betting skins in Colorado, Indiana and, upon launch, Illinois. Revenues and Adjusted Segment EBITDA were both $1.1m in the third quarter of 2022, versus $1.6m in the prior-year period.

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