Century Casinos Could Focus on Selling Canada, Poland Assets

Century Casinos’ (NASDAQ: CNTY) ongoing strategic review could take an international turn with the gaming company potentially unloading venues in Canada and its Poland stake in a bid to unlock shareholder value.

A year removed from announcing it is exploring strategic alternatives, the gaming company updated analysts and investors on the potential sale process on its second-quarter earnings conference call on Friday. Co-CEO Peter Hoetzinger said there are multiple options on the table in Canada where the company runs two commercial casinos and a pair of racinos in Alberta.

Hoetzinger added Century is waiting for “more clarity on the asset sales” before it commits to meaningful debt reduction.

Impetus to Divest Casinos Poland Likely Growing

The fate of Century’s two-thirds stake in Casinos Poland has been long lamented by analysts and investors and there may be some progress on that front as Hoetzinger pointed out two unidentified groups are performing due diligence on the operator’s Polish assets.

While acknowledging challenges remain with the Poland stake sale because of the regulatory environment and the war in Ukraine, the CEO said preference hasn’t been given to either prospective suitor and that more clarity could arrive “in a couple of months, but very hard to say.”

At this juncture, Century investors would likely appreciate the company washing its hands of the Casinos Poland interest because it’s become an earnings before interest, taxes, depreciation and amortization (EBITDA) drag.

“Poland, once a stable and consistent business, has become a persistent headwind, with run-rate EBITDA remaining several million dollars below pre-pandemic levels,” wrote Citizens Research analyst Jordan Bender in a report to clients.

Investors May Still Be Disappointed

Century investors have been clamoring for the company to do something to generate value and facilitate a rebound by a stock that’s shed 91% over the past five years. Unloading international assets while shifting to a dedicated U.S. model may appease some investors. It’s also possible that plenty will remain disappointed.

If Century sells its Canadian and Polish assets, it’d be left with seven U.S. casinos — two apiece in Colorado and Missouri and three others spanning Maryland, Nevada and West Virginia.