Century Casinos (CNTY) 8 May 212021 Q1 Earnings call transcript

And pardon me, ladies and gentlemen, we apologize for the technical delay. We're now ready to begin. And welcome to the Century Casinos Q1 2021 Earnings Conference Call. This call is being recorded. At this time, all participants are in a listen-only mode. a conduct will we question-and-answer session. Later, like Mr. would to introduce call, today's for host our I Hoetzinger. Peter Mr. you Hoetzinger, begin. may

It Hello? seems -

And Mr. Hoetzinger, you may begin.

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

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

estimate closed QX quarter. to entire our they of were around increase over would in by and the casinos XX% refer but non-GAAP the the for adjusted non-GAAP EBITDA our Without can throughout several financial and after our in to be release addition, US liquidity of be have found of Q&A and EBITDA performance Results of overview I first Reconciliations session. including almost the an were Canada last the million. the measures, Adjusted an been million, our appropriate most EBITDA. to in measures call, because for GAAP In the measures to of limited year $XX.X of we not in adjusted $XX Investor results. the now EBITDA news quarter, compared website will was quarter at our were filing properties disclosures, cnty.com. we available for our will Poland, quarter quarter first of exclusively that, provide closed XXXX. SEC there And in section a our driven

continuing and great And January good. May. to April into quarter. March a it yes, strength and was were exceptional. great early is that it was So February see

and from and from we from been As demand confidence, anyway, are it restrictions, Casinos, almost if from benefiting rollout are since local that demand back now. close a benefiting the has we the the June, demand. most is from actually, other not year regional so strong Well, older stimulus. we from sure fiscal driving from can vaccine easing the for home the strong call around to entertainment, consumer that, I'm to casinos, strengthening preference because pent-up But which demographic

as well to All and of contributed operating with has that our across strategy, these portfolio. disciplined together results casinos, our improved with visitation great efficient as levels our spending and

Other can looking lift, we and our vaccinations very confident the XX-plus lucrative recently, return is benefited delivering but to segment. the restrictions quarter the March, grow this We've high-value indicating identify And XX% improve in us West very than levels influx was QX than operating more loyal keep strong year were translate in EBITDA to database, new worth XXXX. That old question well higher compared reduced progresses. visitation XX-plus player substantially XXXX margins the revenue rest a of to the sustainable. we players expect positive and And high the cost changing. fixed trajectory many to three demographic them revenue new of That remained continued Virginia the visitors. benchmarks. It The are We our Missouri, especially is the trend, at these great strong properties ahead. as with the meaningful to convert and was in higher first throughout where are the new some growth of is when at rollout base regular more players especially players the COVID This cautious still ahead XXXX. new demographic was to XX% continue We've only big as seen new coupled sign-ups, year, providing impressive. on whether from sign-ups performances customer even further of and of from important sidelines. opportunity also to upside started

have disciplined from that activity revenues Savings High a even come to hotel regional gaming And are start in do The as of good achieve speak to base entertainment of been should non-gaming sold, For not strong, is that and behind scrapped amenities. outside revenue. believe from mail believe This pretty with point, through practices, levels direct significant impact We demographic our and that spend the seen in, encouraging have cost we dilutive and true XX-plus more clearly, we and marketing to demand but we strongly. and that mentioned. makes XXXX be those certain margins. for of this impact F&B. COVID, the importantly, margin improvement And to out options, aggressive margins started up row, promotions, to and amount we reduced even But able elimination areas, other limited marketing limited. depend kicking goods play or Las markets is in little a will bit. comps we boost third many to demographic the and including as to promotional feel sustained stay watch flow levels but the quarter amenities margin high Should trends as efficient of as could example more will pent-up labor operators as on yes, operating is we margins, attainable. in operating costs, an have expect go especially support expenses. EBITDA most competing approach have been has be of Vegas continue operating and our player any a get us high through impact for, come during or any a biggest bringing haven't something margins this the at continue that down the quite have relative will revenue continued costs back into on April back and on see May. whether have to dilutive margin significant This advertising, we early

outpacing different Let's City, now of XX% to look throughout about even The and Central was pre-COVID flow Central over XXXX, up at half four-fold Colorado, quarter each approximately table levels. record up In City, Cripple Adjusted was Colorado. quarter. was of reporting a of XXXX, was of over two-thirds Creek, capacity it first was XX% the slot XX% both the EBITDA floor revenue spite the of and it quarter up was operating with quarter. Net casino quarter the EBITDA restrictions XXXX. table game Creek over In XXXX, were full over slot and up opened casinos in fantastic starting county margin in has the the XX%. Cripple half operating each our segment, a restrictions. performance properties positions In gaming the and of jumped machines and It the during positions. first clearly with game for

Central from sports and betting growth see markets, summer two game see in and games Our in anticipate up Cripple strong upside and more XX.X%. We and performances in in from to higher Creek further from to XX.X% months limits. in launches went both continued market City from new we XX.X% table XX.X% share the revenue

three So far, sports up only is one of running. partnerships and out betting

a from revenue, pay cost The with a three participation other All minimum guaranteed without two That's side. or year. our partnerships plans will percentage as any launch later of this amount per year. investment

flows the it to straight line. bottom So,

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lot revenue The Cape again they're As The over and of, XX% the XXXX, XX% Table and and highest top minimal Girardeau I'm a a XXXX. were has slot a we several in guest record-setting monthly revenue highest revenue XX.X%, was Slot result, and seen revenue upside jumped such quarter The first the was was margin up revenue reduced to of XXXX, Adjusted this, the was up counts drinking seeing monthly it gaming were or capacity hit revenue operating listen for over also but property was smoking quarterly record March history. total since areas. up still, to the property's eating, operating records. that truly and quarter March was of a in as at reopening no at X.X over in for month revenue highest at times remarkable. property fantastic. total XXXX. both month it slot F&B over reopening, with as at the Net in up restrictions increases the tables. EBITDA cash monthly comps. XX% was EBITDA since only its June. in quarter,

to amenities and all save iGaming, of And with not-too-distant ability focuses markets. continue advantage future, new and upside additional to online and opportunities sports debt us good EBITDA offers. could further account which customer and loyalty promotions Missouri us, and engagement bring access The for to increasing in feedback betting very take customer that the In We lots could significantly ad mobile direct on the means app. provides for and get and rewards guests mail full also increase visibility customer to gaming of the expenses. legalize revenue on and for

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March, believe now, overnight last character, a customers with trips, people difficult night the for business hours directly is strong capacity. convention the The outlets its limited its of a their destination hotel of two, is and linked staying open a quite getting draws remains which in for short with which we uptick Some operation. of or the stays. was lot to operating vaccinations out the F&B house especially months. and see we Mountaineer comfortable limited Because usually XX of business, more from of getting resort in closed, But feeling since are space

see is in highest So, first more to year. business increased to we've a returning. that the than regional have indications Hotel reservations started the level destination

of XXXX preliminary In Rush exceeding for Street as And numbers. April weeks see Internationally, of in March property the Interactive in may the that online about and June. with an William casino We this come gone for a got point for Monthly the only. operations cash numbers still, couple And Hill. in progresses. we most news of flow These April our morning back EBITDA fact, year early early were closed has a latest live is days quarter. in our operated are show very to gaming partnership $Xmillion. opening we great in but Poland

factors burn in actual we the with in update gaining anticipate XX% but It's we closed. next were reopen, EBITDA next - early at quarter. key Polish is you to distribution As the the that parties limiting efficiencies we of for allowed already time. The these are that's Hospitalizations reported, about the currently result entire Canada, outcome expect reopening will population at as with casinos. this We cash pretty It margin. are percentage we talks in predict Once of to in at of call. vaccination in while for mid-June, are but And sale precise the earnings closed are customer And reopening. is have million, speculation monthly a of the as are dose. we negotiations. first we ground. about point the to takes demands, should $X.X which more realize several we rollouts a time, sometime about certain least for can't and amenities labor we increased Vaccination month, today, our

we the province Additionally, online sports for significant concludes for of Alberta, provide where us upside have licenses. the Canada XX of That potential four in in out of the operations. betting could round-up licensing

a Now and sheet, words liquidity few balance outlook. about our

cash and land on of As of a financing million million. net The Macquarie to and in and outstanding bank debt balance in of debt Downs $XX.X of debt end $XXX.X Credit March, resulting had $X.X million net $X.X $XXX.X lease related $XXX.X deferred the million Europe, in a related of included debt long-term costs. in outstanding cash in million the we Century $XX Agreement, million for million to in our sheet, equivalents Canada

CapEx select not almost investment. who properties and remarkably hours been our do any revenue live than properties. from good has need with all our Overall, strong, a mostly We in within slot all are going projects, our our ahead business substantial that, new coming customers product. shape Other of are drive X.X from with

successfully We our premium customers. a executed strategy have on local built

strategy, Going forward, right continued and of to our we focus driving a on committed will increased a result EBITDA operating customer. stay firmly tight the operating as discipline

particular entertainment back, Even in and believe to indicate options, in Las and to margins and as casino markets other will come in performances gaming we high sustainable are that. Vegas, be seem April the regional local our early May starting

let the we of American in our positive enthusiasm reopening I'd as members, On acquisition looking Company's now can and speak, model. and competitive the the to team leverage right of revenue we of to to and thank in our into cash a our developing and With customers. lot ahead, opportunities, and manage Operator, stockholders with our terms business our without and business, betXXX, and we Rush income and With for we a continued entering Board, go like North Hill, further online America relationship and landscape, brand. broaden in gaming right on online sports land-based now. to be learn and off-track from opportunity us. partnerships the investment betting guaranteed us William highly space sports We and by our business. sports our as streams flows believe truly thank possible season we the these pandemic busy with and however, own seriously It's promotional are and as all guests handful attention for And excited but betting may racetracks their look continue Sports, as online we racinos, Thereby, the your our as Poland enhancing us approach generating betting well racetrack start a US our casinos, session. presented North iGaming at the and footprint betting our In are gives iGaming, multi-channel Street Long-term, behalf challenging I times. by Tipico for we the Canada hopefully subsides. summer during the successful company. It our already management multi-channel loyalty we also Circa you well to iGaming. operating are, and and a please. casinos forward about and Q&A a that, consider

you, question-and-answer And At will from a and this question from gentlemen. ahead. first Thank we Bain ladies go Instructions] Please Riley. [Operator our conduct B. session. comes time, David

Your line is open.

forward and Great. congratulations there. today and trends reopening Thank the clearly performance on you

could know understand us You first M&A was help the I you current environment. hoping

the what out As on you product seen of specifically Are helpful. tightened? have the number overall would be to strong you know, going previously, they line Or given kind acquirers? there know, really any view you You what's or have, is as with reopening it in know, been prices reviewing supply of here, same tightening? you've

David. Thanks, between fit portfolio. at - properties a to about there compared are interest there half well dozen out us are dozen But on fewer could and Yeah. the certainly ago, We that surely, a market. of our into least to and very year

deal especially can EBITDA a terms look us. appeal and how do up we if our you it's And that, looking we our go our price where an that levels, In we year on with current think that last with with valuation four in or - and a it days, for market is unlikely have based done done get around actually we it EBITDA times teams But difficult, that or not works we property. do that and difficult. paid, numbers, extremely apply numbers same just the ago, come terms very number. that diligence we people, we so. a was we due at Because of on over these with year's

try come apply that So, to from own marketable. with away our and stay estimates up and we

year still So, it attractive there. a but bit is little targets a very the than was ago, smaller landscape out

I awesome. that a this ask I'm early going antidote I Amendment Any days. one think Okay, as know hoping it'll short, third the to it's be can games brief but lift? be anyway. on short new table Any And is well, I so in under Colorado max XX?

Erwin?

this Yes, Erwin. take approach. We a is cautious

base, have action that We have feeling general on we to opening, up not a saw we And first $XXX. a Colorado. going half there in only little Overall, while maximum set until bet higher our at at it $XXX. that will market but end take the players the in up

of games least anywhere or tables here and have back the yet. at been not new few With other a there, exception no added

So I I will to more the like think be able we exercise, amounting to something and days it's say, say early definitive.

generally our this US is the know that, similar different that think out structural your versus restrictions to like to there reopens, Canada or is we things of Canada, drivers I strong but don't reopens? margin if If reopening about from about are Okay, we think capacity the great. US assume And in overall should there and final both reopening? anything the else dynamics promise. any one, gate, align the that

we'll of the kind US see mirror. think openings I

than We hope pent-up cautious really that definitely right numbers permitted go. interesting with from will again We when are non-gaming the other would the offerings offerings produce and open we [indiscernible] the if be site can and to do that we'll think that and conscious. get demand cost and everything we we EBITDA

- limitation a even on if some a as or can, were of produce have we we slot as could more. still had much machines, a had fantastic here as because restrictions mentioned, we people the numbers hindrance there, basically longer that simply in may few have seen it playing I we if Just markets it and

Awesome.

guys. so Thanks Okay. much,

you. Thank

Our question. next state comes from question Please from Macquarie. Chad Beynon your

my and you afternoon, taking kind I congrats mentioned of and influx for results. on ongoing. Hi. question here, thanks are Good know talks still the that Poland nice quarterly is

of due quickly? you're actually what discussions restrictions it's opens comes mentioned guess, kind and when normally, propel property? remind we be to then to in the having the that you this terms open I of we You the open first once expect property should Thank that us that is you. that in back After would up? the of demand that question, start running terms should week. And the Can - divesting

issued up was another release we or When midnight to for so. the be we that news They postponed open told most that us around this morning, weeks. we that likely last tomorrow but then until or and changed it allowed they will night that four

is you and it now. XX% regional allowed into drawn and casinos that early may come about get demand go. and will have and would the pent-up not of right of as which do international we EBITDA local between to that Warsaw, casino XX% especially June Warsaw like we and in lot also there in be a of revenue to business. to will away that's back The So add? Once Erwin, travelers, truly the is casinos from casinos business that are the quickly local Warsaw from that traditionally their as the business and there are reopen, outside expect translate in

we it's And expect, I Yeah. you say to speculation, wear other what we an to nothing but I maybe will we regard of If which to don't. agree hard don't mask, restrictions there know. mean, we with with that, really still we had it's than would say, we don't I but - guess, the to obligation would say. then question be a know, say

this pivot from sales, all technology that, come limiting a with, you. in marketing, revenues. know, Thank to this of connecting you potential getting companies the to change the additional technology, on standpoint thank know, a would third-party kind know, strategy, is strategy, or, decide those just And it's your of that but your would you you. a use expenses, Great, if the with just something online BXC of costs? help You lot that then whether you you

This is Erwin.

we a that in and more them start clearly keep partner definitely a comfortable Going get with model various in EBITDA-driven. we will wiser step-by-step that and that be as in, possibly we we space third-party take fashion become would services might that revenue and ourselves replace in-house. and and such But flexible

much. very you Thank Great.

you, Thank Chad.

our Thank Please question Stifel. Jeff from question. you. comes next from state And Stantial your

I you wanted Great. Thanks, everyone. to just properties, our your be questions. continue And out truly market on incredible. to taking Thanks congrats, start on results morning, quarter. for coming know, really Missouri the nice

acquire close been line those of assets million is they run role to what are before about my two but You But a double is math EBITDA big which know, generating you has were over here you $XX rating margins, impressive. also right XX%. if cited them, top

I my is this. question So guess

see some long-term think as business, you know, you COVID-XX, the in know, do of If How prior about, took over changes the XXXX of you the know, that you've XXXX? structural the ownerships. year reaction course those short-term to as assets out well from you tailwind as “normalizing” guess, into both sort you of, the I versus over assets made or those the to you

more the we are the think that normalization have This going regard we to We they can now. on much think that And we that there now. numbers, is normal is numbers very don't optimistic with Erwin. pretty keep we're

the parts player Okay. what for that understand for of if I they these versus do and during you overarching unpack the base see are that skew to great. casino buyers any bit Well I know, new then, If serves, the to Thanks. sign follow-up, XX% think Great. would that's new hoping it's younger? to tend and and coming quarter, they broader be You to? gravitate the much my floor players there Thanks, number of Anything gaming ups a you up database. incredible. into characteristics know, memory Do was to a XXXX. talked help

have the something an pretty the of have visitors more I that we it Demographics the is so the customers. world sensation same power for those much of our indication. affluent too purchasing who would had as class like it, upper say if XX%

And great. fare that did early the Okay, how out with how just the just progress those and that just quarter new the kind you how then, of during pieced how along you know, that XXXX? think similar I does seeing quarter in you lines know, was strength is March and still you signups of April terms that played levels into of know, versus know,

mean and right. Yeah, seeing strength. April still You early May,

Thanks perfect. congrats Okay, great. really for color again, the and That's strong quarter, guys.

Thanks, Jeff.

Thank you.

Thank I'll you. questions this over And the our from remarks call that concludes Hoetzinger. at closing time. for back now turn Peter

you. Thanks, Excellent. your for participation in in Casinos the Century Thank interest everybody and your call.

of you visit the our cnty.com website financial for wishes Thanks good a and of results section For goodbye. the health. at best our recording again call, have please

Thank conference you attending. today's concludes for this And call.