Full House Resorts officials touted a new revenue source — six contracts to enable sports wagering in Indiana and Colorado — and a proposed new project — a Waukegan, Illinois, hotel-casino forecast to yield more than $170 million in revenue.
Nevertheless, the company’s third-quarter earnings and revenue were flat compared with a year earlier.
In a statement Thursday, Full House said its net income was $1.6 million, or 6 cents per diluted share, for the three months ended Sept. 30, in line with $1.6 million, or 4 cents per diluted share, a year earlier.
The latest results topped the 5 cents-per-share forecast by analysts surveyed by Zacks Investment Research.
Adjusted earnings before interest, taxes, depreciation and amortization, a cash flow measure that excludes one-time costs, fell 10.8 percent to $5.8 million from $6.5 million. The company said increased marketing to promote new amenities at the company’s Rising Star casino in Rising Sun, Indiana, offset gains at the company’s Bronco Billy’s hotel-casino in Cripple Creek, Colorado.
Quarterly revenue rose 0.7 percent to $44.3 million from $44 million, missing the $44.4 million forecast by Zacks-polled analysts.
In a statement accompanying the results, Full House CEO Dan said Lee reported progress at Bronco Billy’s — work continues on a new parking garage (opening is expected in mid-2020) and a new Konami casino management system will go in next month.
Also, Lee said the six online and mobile sports wagering contracts signed in the quarter, including two with Wynn Resorts Ltd. subsidiary WSI US, could bring $7 million in minimum annual revenue guarantees for 10 years. Full House said the deals, which cover the company’s casinos in Colorado and Indiana, are also with Churchill Downs and United Kingdom-based sports betting operator Smarkets.
“We are excited for the new opportunities that sports wagering will provide our company,” Lee said in the statement.
On an earnings call with analysts, Lee was even more exuberant about the sports betting deals, saying the earnings per share from the sports betting is valued at $2 – almost as much as the company’s current share price.
He said Full House’s name won’t be on any of the online books, saying the company is more like a landlord.
“We signed these sports betting deals and doubled our value. This is really mega-f***ing important,” Lee exclaimed.
The Silver Slipper hotel-casino in Bay St. Louis, Mississippi, was a bright spot in the third quarter as it had been in the second. Revenue at the hotel-casino rose 1 percent to $18.1 million even after Hurricane Barry’s winds and rains lowered business volumes for a weekend.
Net revenue rose at Bronco Billy’s (up 8 percent to $8.1 million from $7.5 million) but fell at Rising Star (down 4 percent to $11.7 million from $12.2 million).
In the company’s Northern Nevada segment, which includes the Grand Lodge and Stockman’s casinos, net revenue in the quarter fell 1.6 percent to $6.3 million from $6.4 million.
Full House applied with the Illinois Gaming Board for a license to develop and operate American Place, a hotel-casino near the intersection of Illinois Route 120 and U.S. Route 41 in Waukegan. The project will include 1,500 slot machines, 60 table games, a 1,500-seat live entertainment venue and restaurants. It projects $173 million in gross revenue.
Full House said American Place ranked first of the three casino proposals the Waukegan City Council certified at a special meeting Oct. 17.
Nevertheless, the company warned that the state board might reject the licensing bid.
Full House shares rose 2 cents, or 0.81 percent, Thursday to close at $2.48 on the Nasdaq. The company’s share price has risen 12.7 percent in 2019.
CDC’s Howard Stutz contributed to this report.
Follow Matthew Crowley on Twitter @copyjockey.
