Century Casinos (CNTY) 9 May 232023 Q1 Earnings call transcript

Good day, everyone, and welcome to the Century Casinos Q1 2023 Earnings Call Webcast. [Operator Instructions] Please note today's call will be recorded. [Operator Instructions].

It is now my pleasure to turn the call over to Peter Hoetzinger. Please go ahead, sir.

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

update forward-looking always, no actual be forward-looking revise uncertainties a results materially will or that to As that actual obligation -- risks our involves discussing would differ otherwise. remind information, information, like statements, you statements. we forward-looking that undertakes we whether several of may result which to future The and company to or may events the from cause as new

limited We detailed of our adjusted performance a you news factors we be EBITDA. and various risk non-GAAP encourage SEC the our to Investors in liquidity cnty.com. can in releases website not section our available to measures review provide and [Audio appropriate filings at to, of filings of the our found filings. GAAP and discussion Reconciliations SEC these measures the but in Dip]

overview quarter was provide increase was quarter will first there X%. the XXXX. will session. quarter Net now EBITDA. million, record $XX.X of results an X% Adjusted that, of a and first delivered revenue a the record After net Q&A We $XXX.X first million, adjusted revenue be EBITDA I of an increase.

segments We each one growth revenue showed reportable to are compared that of our pleased year. particularly of QX last single

resilience for our excellent year our demonstrating start our an model strength was to diversified business of once it the company, of So the portfolio. and again

solid February. delivered in managing play record co-customers core customers and has especially our efficiently focusing business of Our our on and increasing our from strategy results. We generated January business from

didn't segment April. our the our We focus play increasing get database, database, as into March upper in on which of perform you core well. As from Hence, customer. and also our going is in quite lower that the saw we

impacts. see business, of we side inflationary expense continue the the On to

environment pressures teams whether across pressures, largely insurance The cost a our continue increases cost them. with dealing marketing or effectively competitors all remains and forward. inflation seeing rational markets but Nothing It either. approach normalized and they envision of to Wage our elevated. is across we is relatively wage stays are we very us are disciplined, through cost unusual are We for but pretty do increases promotional all going stable. unusual, utility managing anything board, utilities be the not inflation

Looking at segment results.

Our with solid had Colorado X%. up quarter revenue a business

slightly revenue a The City with slight utility a higher Central increase trip. in spend from costs. on overall While as well year last Creek Colorado in We but saw and down labor came and up down QX EBITDA EBITDA. was margin trips, XX% to was as of count due per XX% little, Cripple of guest in a to lower

less age trips of Cripple population especially are elevation town we X,XXX X,XXX at of market, this an employees. group. number we under gives than feet Creek, from of Creek, a that project providing gold historic the a XX standpoint, housing with in mining labor From will small XX tight advantage. age increased competitive In In our the us employee significantly complete for and demographic, this good a an the accommodation younger certain summer, Cripple

but decline a drop. was Resort up at slightly X% grew the on & saw quarter in strong. Moving table of drop which was Mountaineer Racetrack was Virginia. X.X%. to Revenue It West Casino, mainly play by XX%, our unrated Slot

this this a live was due of crossover year. January from betting Our to that loss analysis sports in on play went due of to most indicates higher X

in number which increases availability The from expenses in related single-digit ADT and rooms. Mountaineer. of staffing of senior departments limitations to of about drive and challenges, horseracing EBITDA hotel to F&B insurance. hours was In in resulting experiencing particularly operation under and are is from hotel high trips, count hour's pressure by ranges and saw customers the an higher we high guest the casino, still

despite up In difficult a Missouri, a bit comp. revenues were

from QX highest day the Cape several in the severe all table of trip. at XX%, drop but good was late Those from whole trips, in very a year's end number EBITDA approaching the XX. the was quarter, not threat the quarter, At lower saw spend visitation negative for history. a the the some it only last had Missouri. X% per the to properties Friday, year last We on but of quarter, related impact, XX%. example, all, significant down But quarter a For sits Tornado weather weather, of in the percentages. with margin had just of less slightly including days, March severe of impacted Girardeau's final decline also of

the from The in likely picked guest boat of percentage strong EBITDA XX-plus was whole was temporary to the strongest Girardeau was land-based adds the group prior the much into the because Normalizing demographic a to the up additional group most allowing where river with enough Caruthersville, showed up under to access. year. age the significant where it would year age XX for in of building the have margin It trips. number increase Cape easier growth, different last casino moving bring

importantly, provide plan area. XXX for which hotel next progressing much customers land-based according tables Caruthersville of is and permanent more increase over and it is be XX rooms, schedule. budget convenient and efficiencies. But gaming operational our new catchment will gaming XX% in will increase a It machines our positions hotel total open the The will new have year. will the We to a development slot property and significant compared QX most of in riverboat. XX in to Construction old to it casino of

more. excitement over a on in next year more opening events around expected create early Girardeau track It hour transform is of summer. dining, and casino casino and started with a taken away the open an Cape gaming, and six-story have resort estimation, steps we A full to construction a our have new mind, in this Cape conferences, for With property XX-room from hotel. development to is Illinois to concerts, temporary Girardeau that we offering

to north Moving Canada.

four solid in XX%. posted doubled Our revenue strong X% the achieved EBITDA construction. to Race quarter, last and compared our by even The to these by gains by access in though gains was results properties We road EBITDA Century year. increasing and Mile impacted showed the largest property Edmonton

X% call, nice this of of effective reported years. and As of giving the year rest the next Alberta Commission last the portion by for earnings has the operator's next. X this year, revenues Gaming April from for couple slot a boost us increased during

has so able color Poland. European Finally, inflation-related Revenue to and higher, table for XX%, They Poland. higher gaming than increases quarter compensate performance. a some XX%. strong casinos very more been was was on was up up our revenue. through revenue Slot drop around in All great had was was expense Casinos Poland growth. in F&B EBITDA another good

war Ukraine or As our number mentioned no we impacting have and negatively the previously, not the results is the Ukraine. employees suppliers in significant from of

right. balance quick at our that, look All let's a sheet. With have

leverage pro These debt-to-EBITDA basis, forma transactions. XX, the $XXX Nugget million ratio in we As the and net X.Xx. look will cash outstanding net including at and cash ratios if lease equivalents adjusted of The improve in Rocky was debt. million on had X.X. a Gap we The and $XXX March it

X.X, to lease and net down X.X. goes Net leverage the leverage to adjusted goes down

closed As reported, X. April Nugget we the on transaction

real Now half Nugget's XXX% company. we the own operating the of of estate and

the estate. We half also other have of an option real to buy the

$XXX an immediate we anticipate the to the of it. to been closing that Nugget without million have income finance we as impact acquisition on transaction, the that interest the support With any net borrowed income we to from paying

suites, the casino market. convention tables, we new resort hotel six and This of with that XXX area, and rooms full-service provides location full taking as over well several Reno-Sparks in advantage signage. outdoor and as the a and largest façade entertainment unmatched is with restaurants, a XX of exposure slots with Nugget The the one on a venues plan indoor X,XXX areas destination and attractive in

the for improvements. effects We small than significant seeing immediate the especially results year-over-year all for as and with growth, potential revenue ever gaming the well are convention focus operational synergy as operational The will business. departments. are excited in We floor implemented on good raising on already be changes Nugget and potential more about the across than group

into for and revenue and XXXX. the record groups banquet convention profitability. have pacing and leading is year criteria, business and this convention ahead rest increase year, Group are to next, to generate going nights, comp record group new we Nugget of overall results Several in expect and For overall the the our group to ADR casino from room allowed expecting high-spending sales. us better

Gap full-service an less center, paid stable event outdoor We for is expect we DC rent than Baltimore to acquisition meeting golf expect and Rocky expenses, generate cash close $XX hand. a from Jack with Gap resort the EBITDA company. two spa July. to than and the After includes square on we million and $XX Maryland, XX-hole million foot hours areas, a Metro several several in course, Washington X,XXX a in additional Rocky Rocky Nicklaus spaces, Gap more activities. our In

over five tables, XX of hotel XXX XX,XXX and XXX square gaming consists beverage property and of machines, venues. slot feet The rooms food floor,

two On forma from Gap East basis, giving that acquisitions, U.S. pro and Nugget to reaches we over the the operate after U.S. our of we acquisitions, generate XX% EBITDA the Rocky the effect With casino West. portfolio to a in

persists uncertainty first the takeaway is headed. most the where results into probably our move difficult XXXX, economic continues resilient we of it that part, be makes are which most consumer to As But customer today further from trends the core for predict to quarter. the important

Rocky have and our the we cash years. expect coming development Gap a drive projects, and years of which we strong free company flow ahead, Nugget in material and for EBITDA increase to in all the come positioned Looking growth with to Missouri acquisitions for two our

and on business strong our I'd demonstrating and quarter our the conclusion, efficient of further enthusiasm. core our loyalty from stockholders our company our this our customers. On continued and company's was play for the of for management members, your and built operating behalf thank In to attention. thank Board, you I another like strength the model guests of their an for driving team resilience

can And session. Q&A the now start operator, we

Instructions]. [Operator you. Thank

Our first question Jeff from comes Stantial.

what database. in group the even things sort the the of income into And extent just what I at percentage of then this database of to your Or -- this revenues? fall constitute? better, and looked the wants percentage Thanks. you does morning band this pullback April way? call cohort Erwin, a you demographics Great. Peter some March the of commentary Thanks. bit take out trend, out or for everyone. just that you whoever in frame in taking Helpful this, income more to regarding Good called lower can questions. our sort earlier the guess what of does have Thanks

as was, April the few March and came week like the -- and more end It the then going in was into trend, from not third of you -- back. second we saw it don't it because on, I it's -- from the lower last said, on But it April. a of week in days

-- a had it softness. period we about So was week three of

far, XX% lower this continuing. do has are hearing it season. refund Maybe refunds So We're not year. the to we about that see the with tax are

have So we'll that color do additional it. to do Erwin, on something you with maybe that? have

at no, look we no, then hand, and details the for that asked We don't to later. we have don't would send we -- have

role more of you helpful. tax your my of looks your like question. were points Peter, on on Can I with agree Perfect. refunds quite what's It And that Canadian commentary. appreciate moving nicely really the timing of tend some That's there, assets expand And margins just playing bit kind then quarter-on-quarter. for that? up to follow-up driving to a the here. I

Erwin?

management, COVID place year-over-year, I in I just What might right? has lifted was that see be falling a nothing it's things we of last mentioned in various only, been think February and it's think good it is And particular. year. into end the the

has that been franchise So well.

Perfect. Okay. And all. both quarter. on Very helpful. congrats the on. nice I'll pass it Thank you

from Chad comes question next Our Beynon.

asset what international value operations some thinking to guess, how you allocation. that? then is? or future. the question. it's balance Nugget with if ask the be Thanks with you build morning. of really and might to and to good just that sell operate credit that real capital question not really disconnect closed, revisiting And selling to for which anything, that where into On no taking Seems mentioned estate sheet versus there's recent the now wanted has Poland, business getting about the calls, about that some the land like makes sense Thank you've for. my stock trading monetize I on the there's either operations Hi, I the or But are on a is need just with kind still value, you. whether

Thanks, yes, we're in on Yes, Also in we're our the estate interest we on constantly. you're partly high that Chad. paying market. Canada, right, sitting and of in are Colorado light evaluating the real and debt. And also

there think it's fair more it's captures our substantially point in some still pretty -- the it's -- So land value near And something I discussions is to value Colorado plus are from that casinos even there on. of with have the and is is only that was very higher it's the in this make our that assume high Canada list going interesting current positions though on some The we very to future. than this intriguing. it's market view,

and weather that saw the quarter fourth in quarter in great. And Reno. rare first then we That's Peter. the the with even just Thanks

point. operations from from simply benefit the the if were weather and Trying those Or to to bad lost if that? Thank over You you. summer during maybe the into maybe trips period lost wondering could was mountain and prior that pent-up hadn't figure QX those out assumed when the led But elsewhere? to trips? period at how just

Margaret, you can address that?

other there presentation nobody knows well pent-up said regard important I I group absolutely. of for were the to a that and trips mean the and that coming lost during guess be to we Yes, be half more expect to would half demand, our might the with continue. sure, concessive for business, to But numbers, conventions then with regard very it's Peter his are and like anyway to worth people to XXXX the strong what think but year maybe point Nugget.

you point. Good Thank very both much.

XXXX, I'm sorry.

Thank very Okay. Appreciate you. much. both it. Got you

Thanks Chad.

comes question from next Engel. Our Edward

first question. The bounce taking property thanks quarter. for a my the had back nice Hi, Caruthersville in

to the should it that revenue relocated been this property generally order growing put facility? trend too it's was versus to is the steady on higher cost since I maybe does guess, it a wondering, margin the land? Just And track throughout of kind base, quarter? that then And be property start a

Erwin?

the well. I'm not sure, I understood question

Caruthersville pavilion on I than it since has revenue the temporary the -- River? property mean I to moved yes, it is margins Could it higher see and guess was been facility, into possible when the was

Yes. Yes, it could be.

whole, so And no accessibility a let's that now just so mean example, comparison. the there were I easier I missed for better only ship. is, temporary. things the even of One say, it's we mean, -- single has is told if It's easier. a as it's much is just wasn't customer that

so, you're property rate us or sort now? to is give storms that Okay. Helpful. a of April, of terms month it's the you it took margin Nugget, that clean If the of for is relatively been run many I assume snow at anything, fair And over in that month not it EBITDA to guess. big then of since maybe seeing right possible some kind

I think that's too early.

Got it. Thanks.

Jordan from comes question next Our Bender.

taking for Thanks my question. Great.

in your kind the mentioned properties in You Colorado. uptick of

in is renovation. taking from much under you're maybe to Creek of How customers? you. competitors from building loyalty these structurally taking is Cripple business that and of maybe your people of some just those property that going Thank One versus

This is Erwin again.

We -- think We our going regard a a we a as strong Creek, of base result substantial. construction in disturbed on but loyal in the little have not competitors. of it's Colorado. their very In with bit to -- particularly from customer Cripple get operations, slightly that customer a

are we doing we be the well. think are continue even will very opened, standing after that very own, confident on we I our to

follow-up, takes the And in the within of some kind then the Peter, walked quarter. you and of on Okay. margin puts through my Great. Thanks.

business, to progressing renovation some the just the kind well? the is properties this U.S. given Within other year, right think the the about way that margin of of and through in some strength rest of as then some

Yes. getting into summer. we're I stronger quarters now, mean some

up go rest for margins the that the hope we would year. bit So from here will of a the

guys. Great. Thanks Okay.

Instructions]. [Operator

Our comes next Bain. David from question

Awesome. Thank you.

on that previous follow-up a Just question.

like to just start So for or are see to Or of 'XX, baseline margins look points in that we basis margins Is look that were should kind year-over-year at it sort we looks like where off is going -- consolidated XXX if were a basis. on new something XQ? of that and we something of from trend? of of a down sort sort from year-over-year

yes, Now it heading the we're down from the a should not this And quarter from summer little go grows. XQ, season. They bit as should Dave. go revenue up as into

As I at And a from would on little as we year. margin higher same going in that, slot hold been [indiscernible]. said, and hold had bit last table have Without we the some forward, impact

-- slot unless it investments really ramp take of And Perfect. kind And basis? the nugget I we on to trying look that with of then the sort understand that year's that that's floor model refine And the the percentage several based a entertainment convention. I'm quarterly trying overall I hold? just $XX would like typical quarters a year, helpful. didn't Okay. and then even the when to to our CapEx as the there's your the on hear weighting million. much last at calendar on we're missed if could on be cadence next to understand I strength just

And he at in right is Erwin take that, Reno now.

the calendar. for 'XX group calendar remainder also a strong entertainment strong a have We of and business

mid-May. we most and -- starting come XXX to ordered expect of will machines, new them slot we We in

slot had the call of slot quarter. to some very at layout are positive of nicer many that, we from and And should things to then angles, in A looking machines, series floor, think, the improve that how upside. ups so we the on second is, what looks floor on have of make there addition So in to a we fact, good. it a impact the a on quite the laid on lot do and of they potentially, out. lot work We are

that make, patronage, improvements be I'm And we... kind of investments on while given a are that does to for that them out, year-over-year made? of those mean, -- those will again, there's Okay. you to figure -- understand just marketing? how have basis, Great. those the of that sort it Or there take trying -- I a been sort

nothing first we is knows of repainted. Yes. the but comments. the nice that order building floor new we ownership, and doing all, thing that think to about everybody are there the be in have positive is we're of build a I already But another to the and outside

So pretty everybody soon, signage again something towers. that is they on the on put will and will then two start painting new happening. see We

Then have ones, working brightened month, Nugget the We be for signs, and that. the which we signal coming So we and we on we're also more new we'll eligible of better of will completely large new think middle just made spirit. it approach, the marketing the in font the will the rate in revamped that the next slightly. all of

But more focus certainly local market, upside We will will, addition, there well. think in now. is we as continue on is we what there the

you Thank Peter. Erwin. you, Thank

you. Thank

we like over further questions to have this back speakers. no now in the the I would call at time. turn to today's queue

today. appreciate joining our everybody We call

website financial the you at please a any results to questions, recording us. Thank visit of to you. For And out of cnty.com. reach call, follow-up free have if feel the please our section

conclude your Thank participation. you today's for does This program.

any time. at disconnect may You