Century Casinos has published its financial results for the second quarter of 2022, reporting year-over-year gains in revenue and earnings from operations.
Commenting on the results, Erwin Haitzmann and Peter Hoetzinger, Co-Chief Executive Officers of Century Casinos declared that the casino operator had managed to achieve its highest-ever net operating revenue and adjusted EBITDA during Q2, and also highlighted the performance of its Canadian establishments.
Following its record-breaking Q1, Century Casinos’ net operating revenue for Q2 came in at $111.1m, a 21% YoY growth (2021: $92.2m). Earnings from operations came in at $20.8m, a 15% improvement on the previous year (2021: $18.1m).
Net earnings attributable to the operator’s shareholders stood at $8.9m, an 29% YoY rise (2021: $6.86m), while adjusted EBITDA was reported at $29.8m, an 18% YoY increase (2021: $25.2m).
Haitzmann and Hoetzinger, Co-CEOs of Century Casinos, remarked: “We achieved the highest net operating revenue and Adjusted EBITDA during a second quarter in the history of the Company.”
Century Casinos Canadian operations shine
Per region in Q2, in terms of net operating revenue, Century Casinos’ five US casinos across West Virginia, Colorado, and Missouri amounted to $70.3m of the operator’s total revenue, but this was an 8% decline YoY (2021: $76.7m).
Meanwhile, the operator’s six Canadian establishments across Calgary and Edmonton recorded $19m in revenue, a 186% YoY improvement (2021: $6.66m).
In terms of net earnings, Century Casinos US operations reported $10.5m, but this was down 36% YoY (2021: $16.5m). Canada achieved net earnings of $2.86m, up 289% YoY (2021: $1.53m loss).
In adjusted EBITDA, the operator’s US establishments came in at $22.4m, a 21% drop YoY (2021: $28.2m) while Canada stood at $5.57m, a growth rate of 771% YoY (2021: $639,000).
“We are pleased with the strong contribution from our operations in Canada which have continued to improve after Alberta removed COVID-19 restrictions,” noted Haitzmann and Hoetzinger.
Nugget Casino Resort Acquisition
During the quarter, Century Casino completed the first portion of its acquisition of Nugget Casino Resort. In April, the operator purchased 50% of the Smooth Bourbon LLC (PropCo) membership interest for approximately $95m.
The company is also looking to purchase 100% of the Nugget Sparks LLC (OpCo) membership interests for $100m, pursuant to a definitive agreement and subject to approval from the Nevada Gaming Commission. This acquisition is expected to take place within one year of the PropCo investment.
Haitzmann and Hoetzinger stated: “As we announced in April, we have completed the first portion of our acquisition of the Nugget Casino Resort. We are excited to enter the growing Reno/Sparks Nevada market with this transaction.”
Nugget Casino Resort in Sparks, Nevada, is owned and operated by OpCO, while PropCo owns the real property on which the casino is located, leasing the property to OpCo for an annual rent of $15m.
In April, Century Casino also entered into a credit agreement with Goldman Sachs Bank USA, providing for a $350m term loan and a $30m revolving credit facility.
The company used the term loan and $29.3m of cash on hand to fund the PropCo acquisition, as well as repaying approximately $166.2m outstanding under its Macquarie credit agreement.
Lastly, the firm diverted $100m into an escrow fund to purchase OpCo, as well as for related fees and expenses. It didn’t draw on the revolving facility on the PropCo purchase closing date.
