Century Casinos Slumps on Soft Q4 Results, Updates Poland Sale Prospects
Posted on: March 10, 2023, 02:00h.
Last updated on: March 10, 2023, 03:22h.
Shares of Century Casinos (NASDAQ: CNTY) tumbled Friday after the small-cap regional casino operator posted fourth-quarter results that missed analysts’ estimates.
The Colorado-based company said it lost 14 cents a share on revenue of $103.8 million in the last three months of 2022. Analysts expected a profit of 2 cents on sales of $104.2 million. As a result, market participants are taking the stock to task. In late trading, the shares are off more than 15% on volume, nearly quadruple the daily average. Earlier today, the stock slipped by more than 22%.
While the operator didn’t directly address why its fourth-quarter results missed Wall Street forecasts, co-CEOs Erwin Haitzmann and Peter Hoetzinger noted in a statement Century concluded 2022 with record adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) and net operating revenue.
The executives added that construction at the company’s two Missouri casino hotels in Cape Girardeau and Caruthersville is slated to be completed in 2024. In the December quarter, there were some disruptions at the Caruthersville venue owing to low water levels in the Mississippi River. However, that shouldn’t be a long-term concern because the riverboat casino is moving ashore.
Century Nevada Update
Haitzmann and Hoetzinger also noted that the Nevada Gaming Control Board (NGCB) recently recommended that the Nevada Gaming Commission (NGC) sign off on Century’s $195 million acquisition of Sparks Nugget.
It’s possible those approvals could arrive next month, paving the way for the operator’s initial foray into Nevada.
Our application must still be approved by the Gaming Commission in Nevada at its meeting on March 23. If approved, we plan to close the market acquisition in the first week of April, less than 4 weeks from today. We are finalizing our plans for initial investments and upgrades, and I’m more excited than ever about the potential for improvements,” said Hoetzinger on a conference call earlier today with analysts.
He added that Century’s immediate focus in Sparks will be on the Nugget’s casino floor and identifying cost-saving opportunities across the venue.
The co-CEO also observed that the operator expects to close its purchase of the operating rights of Rocky Gap Casino Resort in Flinstone, Md., in June or July. Golden Entertainment (NASDAQ: GDEN), the current venue operator, announced the $260 million sale of the property last August, with VICI Properties (NYSE: VICI) acquiring the real estate.
Poland Sale Update
Before Russia invaded Ukraine, it was expected that Century would look to sell its two-thirds stake in Casinos Poland and use the capital for potential expansion opportunities in the US.
The war delayed that process, but casinos there are thriving due to an influx of Ukrainian nationals to Poland. Century may not be in a rush to part with those operations.
“Our casinos in Poland continued their solid performance. Revenue was up 11%. As our results in Poland are consistently strong, it may as well wait for another license excited to kickstart the sales process. We don’t have any time pressure,” observed Hoetzinger. “That timing is not an issue for us. As you know, we have an excellent management team there in place, and there is no need for any investment or CapEx from our side. It’s quite the opposite. Cash is flowing from Poland to us.”
Related News Articles
Related News Articles
Thai Dice Cheat Sewed Magnets into FingertipsApril 25, 2023 — 5 Comments—
VEGAS MYTHS BUSTED: Tony Hsieh Saved Downtown Las VegasMay 8, 2023 — 4 Comments—
No comments yet