Penn National Gaming, the casino company that owns the Tropicana and operates M Resort, reported its third-quarter earnings today.
Company: Penn National Gaming Inc. (NASDAQ: PENN)
Revenue: $765.6 million, compared to $739.3 million in the third quarter last year.
Earnings $46.5 million, compared to net income of $4.9 million in the third quarter last year.
Earnings per share: $0.51, compared to $0.05 in the third quarter last year.
What it means: The company said the third quarter was similar to the second with earnings before interest, taxes, depreciation and amortization (EBITDA) slightly below guidance (the corporation's official prediction of its own near-future profit or loss).
In a statement about the results, Timothy J. Wilmott, president and chief executive officer, said “shortfalls at certain properties were almost offset by lower corporate overhead and stock-based compensation expenses and initial contributions from Rocket Games which we acquired in August. Although the delay in opening Hollywood Casino Jamul – San Diego negatively impacted adjusted EBITDA, it also resulted in additional interest income from our loan with the Jamul Tribe.”
In the statement, Wilmott reviewed the company’s position in its properties around the country calling out “uneven performance as a result of what we believe to be a combination of macroeconomic factors and an uncertain political landscape.”
He said highlights included Plainridge Park, three of the company’s four Ohio properties, and Hollywood Casino Jamul – San Diego, developed for the Jamul Indian Village of California (“JIV” or the “Tribe”), which opened early in the fourth quarter.
Wilmott said some Penn properties are facing challenges.
They include the Hollywood Casino Toledo because of “significant road construction on the interstate to the property’s north and south; one in New Mexico where visitation is being significantly impacted by ongoing softness in the local oil markets; and the other by new competition in Mississippi — which together offset continued strength in our Las Vegas market operations,” Wilmott said.
Penn bought the Tropicana last year, and in the statement, Wilmott said the company is making progress on phase 1 upgrades to the south Strip stalwart, is developing phase 2 and says the property should do well for his company.
“We continue to believe that with our initial $360 million purchase price that we are well positioned to create an important source of growth for Penn National,” he said in the statement.