Colorado Springs-based Century Casinos reported increases in revenues and EBITDA for the fourth quarter and a record setting 2016 on Friday.
For the quarter, net revenue grew 14 percent year-over-year to $36 million, adjusted EBITDA ticked up 40 percent to $6.3 million and earnings from operations more than doubled to $3.7 million.
Earnings per share checked in at $0.12, slightly ahead of Wall Street estimates.
For the full year 2016, Century reported $139 million in net revenues – up 4 percent from 2015. Earnings from operations ticked up 2 percent to $16.2 million and adjusted EBITDA grew 13 percent to $26 million, though net earnings were down 20 percent to $9.2 million.
“2016 was a tremendous year for Century Casinos with net operating revenue and Adjusted EBITDA reaching all-time record levels,” co-chief executive officers Erwin Haitzmann and Peter Hoetzinger said in a statement.
“The year ended with a strong fourth quarter, with all major operating regions posting solid increases in net operating revenue and adjusted EBITDA compared to the fourth quarter of 2015: in local currencies, Canada increased 8% and 43%, the United States increased 11% and 38% and Poland increased 23% and 52%, respectively,” they continued.
Century’s Canada segment, which produces one-third of the company’s total revenue and half of total EBITDA, saw strong growth from its freshly renovated flagship property in Edmonton and positive contributions from a new casino in St. Albert that it acquired on October 1, 2016.
The company’s properties elsewhere in Alberta province drew mixed results because of ongoing road construction in front of Century Casino Calgary, resulting in a 6 percent decline in revenue year-on-year.
“We continue to learn about this business and we are encouraged with the results we’re seeing so far, particularly property in a strategic location,” said Hoetzinger on a conference call with investors. “The integration process has been very smooth and slowly but surely, we are seeing synergy effects being generated by all our Canadian properties supporting each other.”
In the United States, Century benefitted from nicely from its position in the strong Colorado gaming market, posting an 11 percent jump in revenue and 38 percent growth in adjusted EBITDA.
Hoetzinger said that the company’s two properties in Central City and Cripple Creek were uplifted by a strong local economy.
“The economy and consumer sentiment in the greater Denver and Colorado Springs metro areas continue to be strong. And together with our marketing programs and popular VIP events, that leads to increased visitation and higher spend per visit,” he said.
In Poland, which represents 43 percent of Century’s revenues and 29 percent of its adjusted EBITDA, the quarterly growth was driven in large part by its property at the Marriott Hotel in Warsaw.
The company’s total debt grew to $41 million during the quarter, but its debt-to-EBITDA ratio checked in at a favorable 2.2x.
On its earnings call, Century provided more details about its latest endeavor to build a horse racing and gaming facility in south Edmonton. The property will be called Century Mile, will be located near the Edmonton International Airport and will hope to replicate the success achieved at its racetrack in Calgary, Alberta’s other major population center.
“Looking at the success of our Century Downs Raceway and Casino in Calgary and understanding the potential of the underserved market of South Edmonton, we are very excited about this opportunity,” said Hoetzinger, noting that the next step in the process is to secure approval from the Alberta Gaming and Liquor Commission.
