Gaming and Leisure Properties Chief Executive Officer Peter Carlino discussed second-quarter earnings, plans for growth, and baseball during the company’s call with analysts and journalists on Friday.
A highlight of the quarter for Wyomissing, Pennsylvania-based Gaming and Leisure was a May deal with Bally’s and Major League Baseball’s Oakland Athletics to build a new 30,000-seat Las Vegas stadium for the team on the 35-acre site of Tropicana Las Vegas. Another highlight was the quarterly numbers: Adjusted funds from operation and revenue both topped Wall Street forecasts.
In a statement, Gaming and Leisure said funds from operation were $225.4 million, or 83 cents per share, for the three months ended June 30, up from $215.3 million, or 84 cents per share, a year earlier.
Adjusted funds from operation, which exclude one-time costs, were 92 cents per share, which topped the 91-cents-per-share average estimate of analysts surveyed by Seeking Alpha. Funds from operation are a closely watched fiscal yardstick for real estate investment trusts, taking net income and adding back depreciation and amortization.
Adjusted earnings before interest, taxes, depreciation, and amortization, a cash-flow measure that also excludes one-time costs, rose 5.8% to $325.5 million from $307.6 million a year earlier.
Revenue rose 9.2% to $356.6 million from $326.5 million and topped the $355.3 million average forecast of Seeking Alpha-polled analysts.
In its earnings statement, Gaming and Leisure said the Casino Queen in Baton Rouge, which moved from water to shore with $78 million in financing from the REIT, will open on land in August.
Gaming and Leisure also said it amended its original Penn Entertainment master lease to remove Penn’s properties in Aurora and Joliet, Illinois, Columbus and Toledo, Ohio, and Henderson, Nevada. Those properties were added to Penn’s 2023 master lease.
Also, existing leases for the Hollywood Casino at The Meadows in Washington, Pennsylvania, and Hollywood Casino Perryville in Perryville, Maryland, were terminated and these properties were transferred to the Penn 2023 master lease.
During the conference call, GLPI discussed the A’s deal, under which the REIT will commit up to $175 million of funding for construction costs and may provide more. The stadium portion would occupy nine acres, according to news reports.
Carlino said gears are turning for the project, as evidenced by a flurry of meetings.
“This is moving at a very fast pace,” he said, later adding, “Bally’s was highly focused on finding something that would be magnetic at the site. And so we were … instrumental. And, of course, we agreed to part with the nine acres.”
The earnings statement highlighted Gaming and Leisure’s diversification — the REIT is now landlord to six tenants with 59 properties across 18 states.
For amplification, Carlino said during the call, “We continue to build our portfolio base. And I can say that, while nothing is certain over the next six to 12 months, I believe that we can continue to build that number.”
Gaming and Leisure shares fell 49 cents, or 1.02%, Friday to close at $47.46 on the Nasdaq Stock Market. The shares recovered slightly after hours, rising 33 cents, or 0.7%, to settle at $47.79.
