Regional casino operator Twin River Holdings released an estimated accounting of the company’s second quarter results Monday afternoon and said the impact from the $2.6 billion Encore Boston Harbor was “in line” with expectations.
Twin River, which operates four casinos – two in Rhode Island and one each in Mississippi and Delaware – announced the preliminary results from the quarter that ended June 30 because it is awaiting completion of a modified “Dutch auction” stock tender offer by the end of the week.
A Dutch auction is a public stock offering in which the price is set after taking in all bids to determine the highest sale figure. Twin River, which hopes to raise $75 million, offered the shares at between $29.50 and $33.00 and extended the sale by two days.
The company plans to release its official second quarter results in August.
Twin River said it expects to report between $146.5 million and $148 million in revenue in the quarter, between $15.4 million and $18.4 million of net income, and between $46 million and $49 million in adjusted cashflow.
It said revenue from its two Rhode Island casinos – Twin River and Tiverton – was estimated at between $82.5 million and $83.5 million. The properties faced just one week of competition from Encore Boston Harbor, which is located roughly 90 miles to the north and opened on June 23.
“Our mitigation strategy toward new regional competition is also proving itself in the early going,” Twin River CEO George Papanier said in a statement. “The ramping (up) of Tiverton is proceeding according to plan, and the new facility has showed marked resilience since the new competition opened.”
Papanier said the Twin River Casino saw some decreased play on its table games, but the “impact on slots has been less than expected so far.”
SunTrust Bank gaming analyst Barry Jonas told investors management’s commentary around the competitive impact from Encore “is encouraging, but it’s still early.” Jonas said that weather in the northeast “also drove some softness.”
Twin River, which is headquartered in Rhode Island, estimated the net revenue at its two casinos in the state at between $37.1 million and $39.1 million for the quarter. The Hard Rock Biloxi in Mississippi had net revenues of between $31.9 million and $32.3 million, and net revenues at Dover Downs in Delaware were between $30.0 million and $30.5 million
Twin River acquired Dover Downs earlier this year.
“This property is ramping its operations and financial performance faster than expected,” Papanier said.
Union Gaming Group analyst John DeCree told investors Dover Downs “is performing much better than we expected.” DeCree said Twin River is making changes to increase the property’s operations.
“The company has a lot of low hanging fruit at Dover Downs as it relates to reconfiguring (its) marketing programs and focusing on the table game business,” DeCree said.
Howard Stutz is the executive editor of CDC Gaming. He can be reached at hstutz@cdcgamingreports.com. Follow @howardstutz on Twitter.
