The inclusion of results from its main operating unit, which shed bankruptcy in 2017’s final quarter, helped Caesars Entertainment narrow its first-quarter loss compared with the previous year.
On Wednesday, the casino company said its net loss narrowed to $34 million, or 5 cents per share, for the three months ended March 31, compared with a net loss of $507 million, or $3.44 per share, a year earlier. Prior-year restructuring charges sparked the difference, the company said.
Yahoo Finance-polled analysts expected Caesars to break even on earnings per share in the quarter.
Adjusted earnings before interest, taxes, depreciation, amortization and rent rose 88.4 percent to $518 million from $275 million after including results of Caesars Entertainment Operating Co., which exited bankruptcy in the fourth quarter of 2017.
In a statement, Caesars Entertainment CEO Mark Frissora touted the results, saying they came despite unfavorable year-over-year hold, weather-related property closures and a year-to-year shift in Las Vegas’ convention calendar.
“Strength in our core business including slot win growth and increases in operating efficiency mostly offset headwinds,” he said.
Revenue rose to $1.97 billion from $966 million, also buoyed by adding in the operating unit’s results.
“Gaming and hotel results proved to be stable in April and economic indicators are favorable,” Chief Financial Officer Eric Hession said in the statement. “We remain optimistic in our earnings outlook for the full year.”
In Las Vegas, Caesars Entertainment’s same-store revenue, revenue at properties open at least a year, slid 2.6 percent, primarily because of $19 million of year-over-year unfavorable hold, the company said.
Caesars Entertainment, which operates 47 casinos in 13 states and five countries under the Caesars, Bally’s, Flamingo, Grand Casinos, Hilton and Paris brand names, broadened its portfolio domestically and overseas during the quarter.
On April 13, the company said it agreed with the Buena Vista Gaming Authority, an entity of the Buena Vista Rancheria of Me-Wuk Indians of California, to put a new 71,000-square-foot Harrah’s casino near Sacramento.
In a statement, Caesars said it will manage, operate and maintain the property, dubbed Harrah’s Northern California, on behalf of the Buena Vista Gaming Authority and Buena Vista Tribe.
Looking abroad, Caesars said April 25 that it will build a nongambling hotel in the Puerto Los Cabos, Mexico, and manage two nongamblng hotels in Dubai, United Arab Emirates.
The Mexico property, a $200 million Caesars Palace-brand resort, will have 500 rooms and suites, a 40,000-square-foot convention center, a spa, two golf courses, three restaurants and entertainment venues. Caesars Entertainment will manage and receive a licensing fee management fee for the hotel, which Mexico’s Grupo Questro will develop.
Meanwhile, Caesars will manage two nongambling hotels and a beach club in Dubai.
“This project represents Caesars’ ability to focus on our strengths in hospitality as well as reinforce our commitment and capacity to establish brands in new global markets,” Frissora said in announcing the Dubai venture.
Caesars also said it authorized the buyback of up to $500 million in company shares.
However, closer to home, executive pay had Las Vegas’ Culinary Union calling for reform.
Reuters reported that Caesars Entertainment’s April 10 proxy showed Frissora made $23.9 million in 2017, up from $9.5 million in 2016, reflecting the value of a one-time of a $16.5 million retention-restricted stock grant. The grant came as Caesars’ main operating unit was emerging from bankruptcy.
Reuters calculated Frissora made 601 times as much as his median worker in 2017. In a letter to Chairman James Hunt, highlighted by Reuters, Culinary Workers Local 226 asked Caesars Entertainment board to cap CEO pay at 150 times that of the median employee. New federal rules require U.S. companies to disclose pay ratios.
The union called to oust private equity representatives from the board’s compensation committee. The committee now includes Apollo Global Management senior partner David Sambur as chairman and TPG Captial senior adviser Richard Schifter.
On Wednesday, The Associated Press reported that the union said Caesars Entertainment rejected its plan to including language in under-negotiation labor contracts to shield hospitality workers if a “Do Not Disturb” sign has hung on a guest’s hotel room doorknob for more than 24 hours.
The union told The Associated Press that said its proposal would called for security to open a guest room before a housekeeper enters if a guest has declined housekeeping for more than 24 hours.
In February, Caesars told the AP that its security personnel would start checking rooms every 24 hours, sign or not. Caesars originally proposed housekeepers do the checks.
“Do not disturb” sign policies became an issue after the Oct. 1 mass shooting. With a “Do Not Disturb” sign on his door, Shooter Stephen Paddock planned the attack that killed 58 people and wounded more than 500 others.
