Full House Resorts, which fended off a takeover offer in October, said new projects, marketing initiatives and record performance at its Silver Slipper hotel-casino in Mississippi helped the company improve cash flow and narrow its loss and in the fourth quarter. But the result missed Wall Street forecasts.
In a statement issued Tuesday after stock markets closed, Las Vegas-based Full House, which has properties in Nevada, Mississippi, Colorado and Indiana, said its net loss was $1 million, or 7 cents per diluted share, for the three months ended Dec. 31, missing the 4 cents per share loss forecast by analysts polled by Yahoo Finance.
In the year-earlier fourth quarter, Full House’s net loss was $3.7 million, or 16 cents per diluted share.
Adjusted earnings before interest, taxes, depreciation and amortization, a cash flow measure that excludes nonrecurring costs, more than doubled to $3.8 million from $1.8 million a year earlier.
Fourth-quarter revenue was $40.7 million, topping the $40.4 million estimate of Yahoo Finance-polled analysts. The latest result is up 7.7 percent from $37.8 million in 2017’s fourth quarter.
At the Silver Slipper in Bay St. Louis, Mississippi, cost management and amenities added in the past two years — the Oyster Bar and a new sports betting area — helped produce $69.4 million in revenue, an 8.3 percent jump from a year earlier.
Revenue fell at the Rising Star to $12 million from $12.3 million. The company said new ferry service between Rising Star, in Rising Sun, Indiana, and Boone County, Kentucky, which began in September, could boost the casino’s fortunes.
During a conference call with analysts, CEO Dan Lee said Full House plans to use stadium technology, which will allow automated play of craps and blackjack, to save money at the Rising Star. The move would let the company close $5 craps tables when play is sparser during the early morning hours, he said.
“As minimum wages go up and unemployment goes down, we’re looking for every way we can to substitute technology for payroll,” Lee said. “That’s marketing kiosks, maybe that’s front desk kiosks.”
Meanwhile, in a statement, Lee said Full House remains focused on forthcoming projects, including the Christmas Casino & Inn, part of its expansion of Bronco Billy’s in Cripple Creek, Colorado. Fourth-quarter revenue at Bronco Billy’s was $6.4 million, up 4.8 percent from a year earlier.
The company said construction plans are nearly done for the new parking garage at Bronco Billy’s; completion is expected by year’s end. The project’s second phase, which will include a casino renovation along with a new hotel, spa, and convention and entertainment space, will start work when the casino is done and finish by 2021.
Revenue at Full House’s Northern Nevada segment, composed of the Grand Lodge and Stockman’s casinos, was flat at $4.9 million.
Looking forward, Full House focused on potential projects.
In Indiana, the company is exploring developing a new casino in Terre Haute, Indiana, if the state Legislature legalizes it. Meanwhile, Full House said a court injunction has put the company’s bid for a New Mexico horse-racing license on hold.
Full House said the New Mexico Racing Commission found the company’s plan for the La Posada del Llano, which would include an 18-hole championship golf course, a casino with up to 750 slot machines, and a 300-guestroom hotel, superior to four other proposals “in most respects,” but gave no specifics. Full House added that a rival company filed an injunction to bar the New Mexico Racing Commission from deciding on the proposals.
So, the company said, the decision will wait and its timing is unclear.
In October, Full House rejected as too low a $132.5 million buyout offer from Z Capital Partners, the Illinois-based investment fund that owns Affinity Gaming.
Z Capital had proposed to buy out Full House and combine its operations with Affinity, to create a company with 16 casinos across six states. But Lee and Full House Chairman Brad Tirpak said the offer “reflects a stark and fundamental disconnect from our board’s understanding of the company’s value.”
Roth Capital Partners gaming analyst David Bain agreed with Tirpak and Lee, saying in an investors note that the offer was insufficient.
For the 12 months ended Dec. 31, Full House’s net loss narrowed to $4.4 million, or 17 cents per share, from $5 million, or 22 cents per share.
Twelve-month revenue fell 13.9 percent to $163.9 million from $190.3 million.
Full House Resorts shares rose 1 cent, or 4.7 percent, to close at $2.12 on the Nasdaq. The shares have fallen 47 percent in the past 12 months.
Follow Matthew Crowley on Twitter @copyjockey
