The decorum customary to a quarterly earnings call was disrupted Thursday morning by a pair of Century Casinos shareholders. The duo challenged Century management on its business decisions during the March 13 call.
The first investor, identifying himself as Mike, complained, “I’ve seen the stock go down. Very rarely does it go up.” He asked if it was time for a new Century CEO “who knows the American market. … It’s disappointment after disappointment, quarter after quarter. There’s no confidence that this company can turn it around.”
Clearly angry, the investor demanded that Century divest of its Polish and Canadian assets and “all this other nonsense,” and retrench with purely United States properties. Apparently startled by the vehemence, Century executives responded that divestiture was an option being considered.
“Let’s not forget that for a very long time Canada and Poland had a very positive impact,” added co-CEO Peter Hoetzinger. Earlier, he said that the overseas real estate had already been sold and that a pullback from Canada was “certainly under consideration.”
Getting out of Poland was more complicated, due to a joint-ownership agreement. Hoetzinger also pointed out that the war in Ukraine had hurt business. A Wroclaw casino opened in February and “it’s now gaining traction.” But Century had to close its Cracow casino after license renewal was denied.
He continued, “Most of our [U.S.] casinos are depending to a large extent on the lower-end customer,” a segment with which Century leadership admitted it was struggling. Management owns 15 percent of Century, he added, “so our interests are aligned. We’re doing what we can.”
Mike was followed by an investor identified as J.T. who opined that it would be good for shareholders “to see strong insider buying” of the stock. Co-CEO Erwin Haitzmann responded that it was an idea, “but we’re pretty much restricted by the insider laws and rules.”
Earlier, Hoetzinger told Wall Street analysts that, broadly speaking, the fundamentals beneath Century remained stable, especially upper-tier customers, who are spending slightly more.
Breaking performance down by market and casino, Hoetzinger highlighted the results at new Century Caruthersville, which had seen 27 percent more revenue and 32 percent higher cash flow since reopening. November had seen 47 percent and 64 surges, respectively, narrowing to 12 percent and 12 percent in February, but with revenue up 20 percent in March so far.
The growth, Hoetzinger explained, was coming primarily from the upper end, as Century Caruthersville is drawing customers from 70 miles away, “expanding our catchment area, just as we planned. We’re very happy with the strong and immediate uplift.”
Hoetzinger predicted “further margin improvements over time.” Haitzmann added, “The thought process behind that investment was that we wanted to improve our reach” and have succeeded.
Recently expanded Century Cape Girardeau “continues to ramp up nicely, bringing in a new and diverse group of players,” some from 75 miles distant. Hoetzinger said the new hotel was seeing steady growth in revenue and occupancy.
February, he noted, saw the highest-ever revenue at both Missouri casinos, despite adverse weather. “Investments in our property portfolio are evident and our properties have never looked better,” he summarized.
The co-CEO also evinced no worries about the impact of Alberta tariffs and slot bans on its Canadian casinos, saying he expected no more than a one percent dent in business. “Our product makes us pretty fresh.”
With Missouri sports betting in the public-comment phase, Hoetzinger said Century was in talks with a potential operator, to be announced. Later, he said there is “a lot of demand for our licenses. That’s still not defined yet how many we have,” he chuckled. Century, he added, will take a revenue percentage from a third-party operator instead of running sports wagering itself.
In Colorado, Hoetzinger admitted to seeing “significantly different results” than in Missouri, with carded play up 12 percent but uncarded play down. He offered that it was possible that casual, uncarded play was going to nearby rival Chamonix, but said he had no hard data.
Century is responding, in part, by adding a new grander entrance to its Cripple Creek property, one that faces Chamonix. Another negative impact in the Rocky Mountain State was the departure of two of Century’s sports betting partners, Circa Sports and Tipico.
West Virginia and Maryland had seen “a more challenging quarter,” with revenue down seven percent. Upper-crust play had risen one percent, but lower-end gamblers were coming less often.
At Maryland’s Rocky Gap Resort, casino play was down, but all other profit centers were reporting increases. Century was seeking to cut costs at Rocky Gap by 18 percent.
At Century’s Mountaineer property in West Virginia, carded play was said to be flat, uncarded play down 10 percent, especially on weekdays. “This is purely customer behavior,” explained Haitzmann, “Whereas at the weekend, everything is relaxed.”
He said Mountaineer was trying all manner of incentives to increase midweek play. “It’s successful, so a little bit extra [business], but not 100 percent.”
Century’s Nevada operations had been impeded by low slot hold, driving revenues 10 percent lower. However, the company said it was seeing more young players and had cut staffing, overtime, and F&B comps. Hoetzinger said he anticipated double-digit cash-flow growth in 2025.
When one stock analyst raised the question of whether to prioritize stock repurchases or pay down debt, Hoetzinger replied, “It is extremely challenging with forecasting,” meaning no earnings guidance for 2025. “Consumer sentiment is all over the place,” making him cautious about allocating capital.
Retiring debt “would be helpful … but we’re a bit hesitant, due to the state of the economy.” Hoetzinger said he had run many economic scenarios, but “we don’t have a clear picture yet.”
