Century Casinos (CNTY) 12 Mar 212020 Q4 Earnings call transcript

Welcome to Century Casinos Q4 2020 Earnings Conference Call. This call will be recorded. [Operator Instructions]. I would like to introduce our host for today's call, Mr. Peter Hoetzinger. Mr. begin. may you Hoetzinger,

as and on for co-CEO the Century as Chairman everyone, Stapleton. Officer, call. and our With of well Haitzmann, Erwin me call Casinos, Chief thank morning, Financial joining Margaret you earnings the our Good are my

or to as and detailed be we filings factors obligation of will We The events forward-looking risks a risk results result that revise SEC cause forward-looking always, filings. a update and the or we that before statements, to encourage to of you discussion involves no actual from provide future undertakes various our statements. we uncertainties whether of company begin, As you information, our the new differ like which to would information, in remind we discussing these otherwise. number forward-looking review materially a may

X be the EBITDA comes by from results. that, of Over a of EBITDA EBITDA. of both over operations properties to measures our but and year. of revenue out XX% available revenue by After throughout X gains liquidity overview we SEC not call, in at be in QX filing appropriate section our operating cnty.com. an our question-and-answer the XX% our news to, in found website addition, our adjusted XX% there limited now including quarter release Net grew will session. I'll of In posted non-GAAP adjusted Reconciliations where and to measures GAAP EBITDA. U.S., provide refer and fourth increased and Investor financial can strong the of measures, performance the in non-GAAP several last

margins. That, visitation low operations the saw brings time where with by and year basis, a operating limited capacity spend the our of and EBITDA last as the environment double the year. for in result closed and local operating X Canada also Poland $XX and than we even performance our our have season. reopened This disclosures, in grow are by though over and casinos the properties. compared to able with since we that holiday quarter, QX management same would We that of X been been a made the over million more great Christmas a year our have is on quarter, as strong amenities, significantly a estimate was reduces the to Overall increased the summer we or In our results progress successful acquired we were promotional integration pleased new casinos spent robust busy on of casinos our all the our and the to little market acquired compared business a Eldorado, the staying areas being an continued last ownership. The in higher focused floors But year. down guests. acquisition to trends Xx. under little on keeping properties and fourth these throughout more resulting reduced controls somewhat on per the high-margin for visit for down expense was amenities paid previous teams time have EBITDA from Since ago, to annualized the casino June, the in our efficiencies reopened of selective we combined the our the XX% reductions way, with device, tremendous we on last we in we

the upside believe trend, more numbers. in will sustainable. also XXXX. and throughout it higher is higher comfortable As returning older attainable our We to more these continue when looks And see you to feel demographics an know, casinos industry-wide this we margins be

slot In doubled XX% casino as restrictions. XX%, a currently fantastic gaming are has full our machines Creek operating Central City. the visit. Colorado, players increase million. is XX%. more with and today. We Cripple floor of more time table and City, It of and was game The Creek, are reporting county to of each approximately was positions from is properties margin XX% in than table the positions. device open In the operating In starting half different Colorado. up revenue jumped see the Central a floor the half each slot performance game in Let's and in now spending EBITDA of $X.X operation and look of at for per to Net adjusted Cripple significant quarter on EBITDA the segment,

share already sports markets, in X XX%. most both and market X partnerships from Creek up to of went running. Our is up betting Cripple our XX.X% but significantly in

this new table upside and XX% well our other casinos comprise clearly customers, it improved operations. customer The Colorado amount maximum X, forward be revenue to the us this later which the line. and of on flows the without indicating bottom our side, of to guaranteed months for Baccarat. opportunity. will in we a currently introduce is Table participation and games to a so Asian game limit with per from or to couple games This straight will community on below a The for higher year. Colorado partnerships table new offering May than pay remove the capitalize gaming $XXX X And All regional of are segments, comparable appeal of XX% as investment example, revenue, current worth looking is minimum some bet X total such year. plan to any cost markets, launch percentage less gaming allowed

growth generation. properties game revenue for of of were XX% to quarter on is last most Girardeau grow are about machines highest average of player cash they Cape coin-in properties by and Cape the EBITDA even fantastic. carried table equally, for X adjusted we XX%. available margin increase approximately net QX for of to Caruthersville, The great slot XX% We terms again and The the rates. slot play. Compared from and XX%. similar which QX to Girardeau EBITDA positions in by in both results all by driver in increased Missouri, property's Moving Caruthersville, per the of in Results XX%. important and growth an all achieve managed our to these X% year, the in operating revenue flow in market and EBITDA About to was XX% was primary In had Caruthersville, history. the managed

little, that increased. strong. Overall which more Additionally, which remains player. game this usually to possibility the Table guests gets be slot betting increase that handle hour database, of later to from seated contributing behind allowed in significantly, of lagged is betting pulls table. clearly but a volumes has smoke gaming while additional is driving the be will because good per revenue provides down playing soon, upside revenue, We Guests And while higher legislation not we for next more, sports that hope decline have strong the market. faster are play lower from see the the the us year appear very upside slightly Missouri. lifted restriction per the end at that and or in players comes still visitation a end is in

ability on of rewards with guests full earned account customer customer app, with loyalty go a and to save direct The to our the provides increasing take significantly of visibility Missouri and all mail lots engagement and on creates which mobile properties focuses advantage to increase expenses. app opportunities and and This promotions access live further offers. new also quarter, amenities

Casino, Virginia, is a Resort Next quarter. West EBITDA where down Racetrack challenging was and the more Mountaineer had XX%.

where of majority However, importantly, offers and the machines play. ban, that XX% and the the curfew table in at all positions more slot of a the because Ohio, not comes XX% business Currently, floor of the game is surprising of from. temporary smoking Mountaineer's for gaming

with local food Some is COVID-XX the will of closed situation, And numbers. but will space in demographics operating a it and from the the the limited Mountaineer benefit to Because when its casinos. again outlets limited pure softening larger comfortable operation, resort convention remains more out than feel are the greatly XX of so benefit over and more with also capacity. hours character, come probably beverage of open hotel of

operates quarters, is go and so upside the quarter Sports with and Rush partnership next summer and QX Interactive with online Street is feel there to the Hill, Casino casino are QX, live at partnership William also quarters betting best and in in we gaming Mountaineer's ahead. William Racetrack expected Mountaineer Additionally, good with Hill.

Our they account for usually quarter heavy and of QX closed. consolidated $X.X soon. consolidated in has Poland then, close of had hear, Combined, from international EBITDA. in quarter. It company's to Canada we'll EBITDA. a for contributed of the have very Christmas but a in under is down holiday Canada most difficult Europe which operations We still likely season, international what the had busy. mid-February, these basis, in segments Since On for we and million the capacity to restrictions close again is operated $X.X million most last from is total XX% reopened year.

As are today, and talks With negotiations. sheet, reported, Polish sale a the as words about can't in several about with our the of discussions of we and parties But of casinos. outlook. balance that, outcome the these we predict few liquidity

of net that lease to million As of debt are million bank balance All cash $XXX.X for December substantial The credit and debt of of in debt $X.X good net deferred in $XXX.X our of the on costs. million in properties Europe; all in in Century and Downs Macquarie sheet, CapEx in included million our agreement; financing shape. million not and related XX, XXXX, and to resulting We $XX.X Canada, million. long-term related outstanding short in debt we cash in outstanding the foresee any net million equivalents do had $XXX.X midterm. $XX.X a $XX.X

net for within to properties. who revenue normalized CapEx from been X.X revenues our coming all drive put from business approximately almost our have nonessential X% of properties. of our a has customers We our remarkably live hold all basis, stable, On we hours with reinvest now. into Overall, on X% a projects

as with in have synergies and our our that, challenging and to times. we We We the their question-and-answer our and Colorado. go your attention, going continued the enthusiasm a We on our more creating in and focus growth ahead, Board, as management racetracks for strategy these have Canada and can premium summer session. and start look season behalf in members, business now on I'd from and With executed to continued game based coming we through overall for higher-margin efficient, local fully upside betting and on Eldorado. of company's acquired you customers, our guests like to we team stockholders intend loyalty our sports keep more from an casinos please. efficiencies casinos manage the forward. the Thank North And forward we see recently thank businesses table Operator, to busy America. to a successfully mentioned, reopen very

Instructions]. [Operator

from Stantial Jeff from comes here Stifel. question first Your

in any several to operations want possible. you're of We've and regional peers February. pick to your sequentially January start this that I of heard something with seeing started your across from U.S., the Is in up markets? things U.S. your if generally,

Yes, the ash days where we've especially see have with that, we good about that than winter But storms, that's some the exception some that in performance, impact. in right. right? other X February, to has Erwin, Midwest, We XX the seen it

Definitely, yes. Definitely. Exactly as you said.

would the rate potential just in about moving you the parameters subsidies. more looks help some closures Okay. to understanding, limited reclosures, burn what models like upcoming EBITDA Canada it's think around can any my Poland that government us those Great. for us our great. on to But then assets? help That's given the And be frame and comparatively Canada

elaborate I Peggy, can that. you think, maybe on

then can include Canada. that you us in Peggy we government in the effects and of subsidies the the -- also Colorado numbers Sorry. give get

a about a you cash perspective, subsidies net So where in rate are getting well. from month as perspective, that burning cash. $XXX,XXX cash from at And look we're we for Canada, back a burn is

Poland, see. For let's

burn, it pretty from -- an perspective, be EBITDA. negative will to EBITDA is can running You going -- Poland much a there's

see. will a negative Poland $XXX,XXX month. me EBITDA Let $XXX,XXX in probably be every or

I'm just these on just That's sits thinking can -- have a if below numbers burn and be from of you Great. you're that, to this any Okay. offline. we trying And EBITDA you don't cash to clear, helpful. take if sort -- rate, about -- what on can perspective? Canada the

pull really them I can these we numbers right Yes. don't in of have front together. me, but

you're for elaborate about Appreciate you appreciate me. thinking I perfect. quick wondering One was if pricing thinking could the Okay, line outcome how mean I just if recovery on And can't all there? of but you an you that. I frame for that those are on lastly help Poland, assets? mind, XXXX EBITDA? one, handicapping And time that's other Yes. by multiple things that a you there, what on potential further about buyer Or don't of how the is, kind is us

to mean, XXXX again, I everybody normalized it's normalized say then EBITDA. But No, necessarily difficult what talks EBITDA about numbers. not means, obviously,

to XXXX be around so on And probably yes, marketable. based the somewhere reasonably going it's numbers that, and

this difficult unique yes. say But outsiders for has difficult a enter stage. to So I Poland extremely to at situation, the it's mean market. and

place value great there a hand. on that incumbents, that every high you it's for So license and have pretty has a one means the the

hand, life X other has a the license the On of years.

more yes, a had it's with the also to its XX and know it's because -- about potential last value years, weeks. in company, Casinos X Poland, So Interesting the always question -- to buyers, relicensed. been about on put has difficult we how discussions it licenses X should has the for probably our

strong on congrats and color the appreciate really a I quarter.

Jeff. Thanks,

Bain of Riley Financial. from question comes B. David next line from Your the

and of to we've lot of based, heard if just broader two, speak that would thoughts overall COVID? maybe out I And with the seems congratulations have greater then Or guess, another of operators first so, now captured be you same on demographic just of guess, simply will one, be And demographic. a to dynamic? are over think mix the you older demographic execution. a helpful. of do quarter rebalance I My younger be demographic Any seeing broad rollout, that And around core margin vaccine returning. a domestic time? kind would that a we

any Erwin, thoughts do you that? have on

-- that described, David. you see have really don't we Yes, what

much they've been. as always the our -- pretty same demographics now have are We

casinos. And so come But demographics of ease not will is or that -- we on that players in in as has age, what necessarily expect the that more progress vaccinations up a as our distribution the percentage the but change lower-end back. an restrictions in the the further, impact of

little at to I Missouri a impact Okay. Interesting. were positive and you And improvements look think acquisitions, then we the some with Virginia if had West have implement able that CapEx.

understand that model Just may to view terms to at small revenue? margin that the dynamic like should I forward. we things a you guess type the targets looking potential you trying same at of is for, today, drive differently Or if acquisition immediately do reviewing CapEx? be should Virginia of one Missouri, going next little you in that is look the look or the we can West

as think We Yes. similarly before. very we've done

that would much it to just is we investment you into have by to being once going to address on see -- not So huge, was focus owner And eliminate portfolio introducing put to something, the we be not create plus money that operation. of that then, but in more other the overhead difference operational want the by that that need. for to make able example, synergy effects able lot into a and smaller property previous there, improvements property certain a our you the has been

you make for more $XXX of end on your of competitors kind are Okay. ask change change? one spending If first with additional the table there. could going you And to million Creek, of Great. everything higher a former Cripple any changes spillover on that And an at hotel amenities. through because is just game hotel there and fell potentially there? watch one or my I kind one Does Or strategy unfold whatever? relook strategic making before plans traffic your just

I if Peter, may.

have up actually more For the We if and It immediately. It is the this bring see. guests think moment, even to mean this is people expand over, signs Creek, additional the we good need we at by if sleep we of will is don't will us that us property. market. another of react a that already. just to bring will Cripple see watch certainly great. number part happening, they operating alone I for that and And

know, have drawer land you also in been that that we progressed have we As rather have -- ample available and the plans have well.

own gained building by so. day So rather could one we upside we priority. hotel a is not attractive the moment, quickly to the have, it's expanding at we'll be hotel But or rooms our do if decide that there

Instructions]. [Operator

Macquarie. Chad from from next here Your comes Beynon question

elaborate, wondering Caruthersville I you maybe on bit little a Peter, if the was stats. just more could

revenue of a continue I I at up per could beginning, more in customers around sharp time at kind fourth was the the really property? it peak think this and particularly post-reopening property said play player then showing know to Do something visit to levels, higher during in come device. that Or per holiday and was anomaly? the this that XX% the periods spend quarter? back more the you mentioned an you is And you people there higher when quarter. on that's Was just it believe

that properties June, actually since in seeing Missouri. both performance great reopened since We're we've

So thing. wasn't over been Erwin, in color you? onetime a additional it has year a any half certainly onetime is for It It not happening QX. now. a thing from

can only mean the I Caruthersville say I underline in we -- I pleased also really, with but We much, -- numbers in said. what really say, we you we're can't can are too QX.

multiples maybe Xx this deleveraging that, just focused Or current acquisition, given And had thinking EBITDA are Appreciate $XX rental How flow, Great. million Are are back in the Okay. originally that at and then you it. for you take when to this REITs opportunities about coverage. conventional are on you closures. generated higher these there more despite you of point? of restrictions adjust have I some announced your the guys free lease? half know about paying your of of you your for stream? the debt cash advantage 'XX

agreed. thing one it other rent on. to comes one we when agreements Deleveraging the we And is lease that the and focus

in right to perhaps to want address do situation, that new acquisition this that with M&A connection might be that. year. project, address new a time may That to the want we new we So a

deleveraging is the finding another good and on focus target. For now,

are deals roughly And that thinking is the Xx still ballpark? new metric something right of but kind for or maybe use you coverage in that lower, slightly to

that time, mean ballpark. we of rent have know these in We the amount aggressive aggressive. total I'd know don't cap -- some on I'd been in quite us you are Yes, rather you a bit the but rate, because want next go to agreements. lower I a and pay be long-term rather too more little conservative for never

next what's know never years. X in coming the or You X

the Great. Okay. luck. on Congrats of best results Appreciate it. and

Chad. Thanks, Okay.

will further for I Mr. comments. no over are now closing Peter the back queue. in there to And questions call Hoetzinger hand

for Century and Casinos in interest in you Thank participation your your Good. the call.

of of recording section please a visit cnty.com. For Financial the Results call, the website our at

You our for again, good wishes best Thanks and health. have goodbye.

Thank you. attending. for conference Thank This concludes today's call. you

may now disconnect. You