Eldorado Resorts has published its Q3 update for the period ended September 30 2018, recording total revenue of $487.3m, up from $472.9m year-on-year. Operating income was also ahead, showing $91.8m compared with $81.5m for the corresponding period in 2017.
“The 2018 third quarter was another impressive period of growth for Eldorado Resorts as adjusted EBITDA rose at 17 of our 21 properties, inclusive of the Grand Victoria Casino which was acquired in August,” said chairman and CEO Gary Carano. “As a result, all five of our property segments generated year over year Adjusted EBITDA growth, including double-digit growth for our South, East and Central segments.”
During the Q3 earnings call, Carano also talked more about the company’s sportsbook activity, specifically in relation to its partnership with William Hill. “In September, we completed what we believe is a landmark agreement to addressing the emerging US sports betting opportunity,” he stated.
“Our agreement with William Hill provides a number of value creating opportunities for Eldorado Resorts. We see sports betting is a great opportunity as it creates new visitation drivers for our properties with only minimal amount of marketing support needed, which will drive incremental gaming and non-gaming revenues. Given their expertise and scale, we view William Hill as the ideal partner to address the opportunity and believe the structure of our agreement with them, which also provides for an attractive equity stake in the US and global operations, will create great shareholder value.”
Thomas Robert Reeg, president, CFO and director, commented: “And if anybody paid attention to William Hill’s investor update this week, they are targeting $300m of US sports betting EBITDA by 2023, and 20 per cent of that business will be ours, so we’re excited about that as well.”
Subsequent to its Q3 update, Eldorado has also announced the authorization of a $150m common stock repurchase program. The company anticipates funding any share repurchases from its cash flow from operations. The firm has approximately 77.5 million shares of common stock outstanding.
Carano said: “Given the strength of our recent operating results — including year over year Adjusted EBITDA growth of nearly 13% in our recently reported 2018 third quarter results — and free cash flow that we expect to achieve from the recent accretive acquisitions of Tropicana Entertainment and Grand Victoria Casino, our board of directors believes share repurchases represent a prudent use of capital.”