Bally’s Corporation Announces First Quarter 2024 Results
Bally’s reported financial results for the first quarter of 2024 with company-wide revenue of $618.5 million, up 3.3% year-over-year. Casinos & Resorts revenue increased by 4.1%, International Interactive revenue decreased by 4.4%, and North America Interactive revenue surged by 70.2%.
Positive revenue growth in Casinos & Resorts and North America Interactive segments.
Core UK interactive operations grew revenues despite overall decline in International Interactive revenue.
Successful launch of iGaming in Rhode Island and strong performance in New Jersey and Pennsylvania.
Anticipation of online sports betting launch in the UK and future growth opportunities in Spain and Asia.
Strategies yielding positive results at the Chicago Temporary Casino and ongoing expansion plans.
Net loss reported for the first quarter of 2024.
Adverse weather impact and construction delays affecting Casinos & Resorts revenue.
Decline in International Interactive revenue due to strategic shift for profit yield.
Adjusted EBITDAR loss in North America Interactive segment.
Tropicana Las Vegas closure impacting financial results.
Insights
The reported revenue increase of 3.3% by Bally’s Corporation signals modest growth, especially considering the 4.1% increase in Casinos & Resorts revenue. This suggests a stable consumer base and potentially effective management strategies to attract patronage despite economic headwinds. However, investors may express concern over the 4.4% decline in International Interactive revenue, indicative of challenges in non-UK markets. This merits a closer examination of the company’s international strategies and the competitive landscape in these regions.
The 70.2% surge in North America Interactive revenue is a highlight, showcasing the company's successful expansion in the digital space. This growth, however, must be viewed in context of the net loss reported, which starkly contrasts the prior year's net income. The loss could reflect temporary factors such as the closure of Tropicana Las Vegas and weather impacts, or deeper operational inefficiencies that need addressing. The Adjusted EBITDAR figure, while not conforming to GAAP, provides investors with insight into operational performance by excluding irregular and non-operational costs.
Long-term plans, such as the development associated with the Las Vegas A’s stadium relocation, offer potential future revenue streams but come with substantial capital expenditure risks. For investors, the key will be to balance the excitement of expansion against the tangible costs and forecasted timelines.
The unchanged 2024 guidance suggests management confidence in their strategic plan. However, given the volatile nature of the gaming and hospitality industry, coupled with global economic uncertainties, investors would do well to monitor the company’s quarterly performance against these projections closely.
The launch of iGaming in Rhode Island, where Bally’s is the sole provider, is a strategic move that could strengthen the company's market position and enhance future revenue in the growing online gaming segment. The company's focus on marketing optimization and cost structure reductions is critical in driving profitability, particularly in light of the competitive pressures in international markets.
The mention of the UK's White Paper implementation suggests regulatory changes that might impact the company's International Interactive segment. Investors should consider potential regulatory risks and the company's adaptability to such changes. Moreover, the anticipated launch of online sports betting in the UK could diversify Bally’s portfolio and catalyze growth, provided that it aligns with consumer trends and complies with evolving regulations.
For retail investors, the company's developments in the Chicago market, namely the Temporary Casino and the upcoming Permanent Casino, could represent areas for revenue enhancement. The focus on VIP amenities and property accessibility is positive, but the true litmus test will be the market's reception and resultant financial contribution.
Bally’s strategic choice to shut down the Tropicana Las Vegas and pivot to the development opportunity with the Las Vegas A’s indicates a shift towards leveraging property assets for long-term strategic partnerships. This underscores the importance of agility within the gaming and hospitality sectors, where property utilization can significantly impact financial success.
The positive response to enhanced VIP amenities and services at the Chicago Temporary Casino could serve as a model for customer retention and acquisition in other properties. The company's ability to adapt and innovate in customer experience will likely be a determinant of their competitiveness in both physical and iGaming spheres.
Investors should also note Bally’s move to enhance its Atlantic City property with new high-end offerings. This investment in property development needs to be tracked for ROI analysis, as such enhancements must translate into increased patronage and spend to justify the capital allocation.
First Quarter 2024 Financial Highlights
-
Company-wide revenue of
$618.5 million 3.3% year-over-year -
Casinos & Resorts revenue of
$342.3 million 4.1% year-over-year -
International Interactive revenue of
$234.7 million -
North America Interactive revenue of
$41.5 million 70.2% year-over-year -
Successfully launched iGaming in
Rhode Island as sole provider - Closed Tropicana Las Vegas to prepare for the Las Vegas A’s relocation to a portion of our Tropicana site
Summary of Financial Results
|
Quarter Ended March 31, |
|||||
(in thousands) |
|
2024 |
|
|
|
2023 |
Consolidated Revenue |
$ |
618,482 |
|
|
$ |
598,720 |
Casinos & Resorts Revenue |
|
342,329 |
|
|
|
328,786 |
International Interactive Revenue |
|
234,683 |
|
|
|
245,572 |
North America Interactive Revenue |
|
41,470 |
|
|
|
24,362 |
Net (loss) income |
|
(173,914 |
) |
|
|
178,336 |
Adjusted EBITDAR(1) |
|
148,115 |
|
|
|
|
________________________________ |
(1) Refer to tables in this press release for a reconciliation of this non-GAAP financial measure to the most directly comparable measure calculated in accordance with GAAP. |
Robeson Reeves, Bally’s Chief Executive Officer, commented, “Bally’s is off to a solid start in 2024, driven by revenue growth in our Casinos & Resorts and North America Interactive segments. While International Interactive revenues fell
“Casinos & Resorts revenues rose
“International Interactive revenues declined by
“North America Interactive generated first quarter revenues of
George Papanier, Bally’s President, added, “Our strategies to ramp operations and grow revenue at the Chicago Temporary Casino are yielding positive results, with the top-line improving month-on-month throughout the first quarter. Key drivers include the ongoing introduction of enhanced VIP amenities and improved access to the property via expanded shuttle service. We expect to build on our success with continued momentum into the spring and summer months. We are very quickly approaching July, which is when we gain control of the River North campus and can begin the development of our Chicago Permanent Casino. Beyond
“Tropicana Las Vegas officially closed on April 2nd, and we are currently preparing the building for demolition later this year. This will allow the Las Vegas A’s to begin their stadium development and keep pace with their plans to play at their new
Marcus Glover, Bally’s Chief Financial Officer, concluded, “Our financial results for the first quarter of 2024 demonstrate the strength of our diversified business segments. Bally’s operating teams remain focused on reducing expenses and enhancing operating efficiency. We are evaluating all business areas and implementing initiatives to streamline or centralize operations where it makes sense. Overall, we made progress on several of these initiatives in the first quarter and are looking forward to the promising opportunities that lie ahead."
2024 Guidance
The Company’s annual guidance remains unchanged with expectations for 2024 revenues in a range of
Bally’s guidance is based on current plans and expectations and contains several assumptions. The guidance is subject to a number of known and unknown uncertainties and risks, including those discussed under “Cautionary Note Regarding Forward Looking Statements” set forth below.
Reconciliation of GAAP Measures to Non-GAAP Measures
To supplement the financial information presented on a generally accepted accounting principles (“GAAP”) basis, Bally’s has included in this earnings release non-GAAP financial measures for consolidated Adjusted EBITDA and segment Adjusted EBITDAR, which exclude certain items described below. The reconciliations of these non-GAAP financial measures to their comparable GAAP financial measures are presented in the tables appearing below.
“Adjusted EBITDA” is earnings, or loss, for Bally’s, or where noted Bally’s reportable segments, before, in each case, interest expense, net of interest income, provision (benefit) for income taxes, depreciation and amortization, non-operating (income) expense, acquisition and other transaction related costs, share-based compensation, and certain other gains or losses as well as, when presented for Bally’s reporting segments, an adjustment related to the allocation of corporate costs among segments.
“Segment Adjusted EBITDAR” is Adjusted EBITDA (as defined above) for Bally’s reportable segments, plus rent expense associated with triple net operating leases for the real estate assets used in the operation of the Bally’s casinos and the assumption of the lease for real estate and land underlying the operations of the Bally’s
Management has historically used consolidated Adjusted EBITDA and segment Adjusted EBITDAR when evaluating operating performance because Bally’s believes that these metrics are necessary to provide a full understanding of Bally’s core operating results and as a means to evaluate period-to-period performance. Management also believes that consolidated Adjusted EBITDA and segment Adjusted EBITDAR are measures that are widely used for evaluating operating performance of companies in Bally’s industry and a principal basis for valuing such companies as well. Consolidated Adjusted EBITDAR is used outside of our financial statements solely as a valuation metric. Management believes Consolidated Adjusted EBITDAR is an additional metric traditionally used by analysts in valuing gaming companies subject to triple net leases since it eliminates the effects of variability in leasing methods and capital structures. Consolidated Adjusted EBITDA and segment Adjusted EBITDAR should not be construed as alternatives to GAAP net income as an indicator of Bally’s performance. In addition, consolidated Adjusted EBITDA or segment Adjusted EBITDAR as used by Bally’s may not be defined in the same manner as other companies in Bally’s industry, and, as a result, may not be comparable to similarly titled non-GAAP financial measures of other companies.
Bally’s does not provide a reconciliation of Adjusted EBITDAR on a forward-looking basis to net income, its most comparable GAAP financial measure, because Bally’s is unable to forecast the amount or significance of certain items required to develop meaningful comparable GAAP financial measures without unreasonable efforts. These items include depreciation, impairment charges, gains or losses on retirement of debt, acquisition, integration and restructuring expenses, interest expense, share-based compensation expense, professional and advisory fees associated with Bally’s capital return program and variations in effective tax rate, which are difficult to predict and estimate and are primarily dependent on future events, but which are excluded from Bally’s calculation of Adjusted EBITDAR. Bally’s believes that the probable significance of providing this forward-looking valuation metric without a reconciliation to the most directly comparable GAAP metric, is that investors and analysts will have certain information that Bally’s believes is useful and meaningful in valuing its business. Investors are cautioned that Bally’s cannot predict the occurrence, timing or amount of all non-GAAP items that may be excluded from Adjusted EBITDAR in the future. Accordingly, the actual effect of these items, when determined, could potentially be significant to the calculation of Adjusted EBITDAR.
First Quarter Conference Call
Bally’s first quarter 2024 earnings conference call and audio webcast will be held today, Wednesday, May 1, 2024, at 4:30 p.m. EDT. To access the conference call, please dial (888) 632-3384 (
About Bally’s Corporation
With 9,900 employees, the Company's casino operations include approximately 15,000 slot machines, 550 table games and 3,900 hotel rooms. Upon completing the construction of a permanent casino facility in
Cautionary Note Regarding Forward-Looking Statements
This press release contains forward-looking statements within the meaning of the federal securities laws. Forward-looking statements may generally be identified by the use of words such as “anticipate,” “believe,” “expect,” “intend,” “plan” and “will” or, in each case, their negative, or other variations or comparable terminology. These forward-looking statements include all matters that are not historical facts. By their nature, forward-looking statements involve risks and uncertainties because they relate to events and depend on circumstances that may or may not occur in the future. As a result, these statements are not guarantees of future performance and actual events may differ materially from those expressed in or suggested by the forward-looking statements. Any forward-looking statement made by Bally’s in this press release, its reports filed with the Securities and Exchange Commission (“SEC”) and other public statements made from time-to-time speak only as of the date made. New risks and uncertainties come up from time to time, and it is impossible for Bally’s to predict or identify all such events or how they may affect it. Bally’s has no obligation, and does not intend, to update any forward-looking statements after the date hereof, except as required by federal securities laws. Factors that could cause these differences include those included in Bally’s Annual Report on Form 10-K, Quarterly Reports on Form 10-Q and other reports filed by Bally’s with the SEC. These statements constitute Bally’s cautionary statements under the Private Securities Litigation Reform Act of 1995.
BALLY’S CORPORATION CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (unaudited) (In thousands, except per share data) |
|||||||
|
Three Months Ended March 31, |
||||||
|
|
2024 |
|
|
|
2023 |
|
Revenue: |
|
|
|
||||
Gaming |
$ |
516,057 |
|
|
$ |
486,895 |
|
Non-gaming |
|
102,425 |
|
|
|
111,825 |
|
Total revenue |
|
618,482 |
|
|
|
598,720 |
|
|
|
|
|
||||
Operating (income) costs and expenses: |
|
|
|
||||
Gaming |
|
236,144 |
|
|
|
217,661 |
|
Non-gaming |
|
48,111 |
|
|
|
52,344 |
|
General and administrative |
|
248,436 |
|
|
|
251,608 |
|
Gain from sale-leaseback, net |
|
— |
|
|
|
(374,186 |
) |
Depreciation and amortization |
|
159,746 |
|
|
|
74,561 |
|
Total operating costs and expenses |
|
692,437 |
|
|
|
221,988 |
|
(Loss) income from operations |
|
(73,955 |
) |
|
|
376,732 |
|
|
|
|
|
||||
Other (expense) income: |
|
|
|
||||
Interest expense, net |
|
(73,131 |
) |
|
|
(63,264 |
) |
Other non-operating income, net |
|
4,554 |
|
|
|
2,610 |
|
Total other expense, net |
|
(68,577 |
) |
|
|
(60,654 |
) |
|
|
|
|
||||
(Loss) income before income taxes |
|
(142,532 |
) |
|
|
316,078 |
|
Provision for income taxes |
|
31,382 |
|
|
|
137,742 |
|
Net (loss) income |
$ |
(173,914 |
) |
|
$ |
178,336 |
|
|
|
|
|
||||
Basic (loss) earnings per share |
$ |
(3.61 |
) |
|
$ |
3.28 |
|
Weighted average common shares outstanding - basic |
|
48,119 |
|
|
|
54,420 |
|
Diluted (loss) earnings per share |
$ |
(3.61 |
) |
|
$ |
3.24 |
|
Weighted average common shares outstanding - diluted |
|
48,119 |
|
|
|
55,089 |
|
BALLY’S CORPORATION
Revenue and Reconciliation of Net (Loss) Income and Net (Loss) Income Margin to Adjusted EBITDA and Adjusted EBITDA Margin (unaudited) |
|||||||
|
Three Months Ended March 31, |
||||||
(In thousands, except percentages) |
|
2024 |
|
|
|
2023 |
|
Revenue |
$ |
618,482 |
|
|
$ |
598,720 |
|
|
|
|
|
||||
Net (loss) income |
$ |
(173,914 |
) |
|
$ |
178,336 |
|
Interest expense, net of interest income |
|
73,131 |
|
|
|
63,264 |
|
Provision for income taxes |
|
31,382 |
|
|
|
137,742 |
|
Depreciation and amortization |
|
159,746 |
|
|
|
74,561 |
|
Non-operating (income) expense (1) |
|
997 |
|
|
|
(3,857 |
) |
Foreign exchange (gain) loss |
|
(2,816 |
) |
|
|
4,308 |
|
Transaction costs(2) |
|
6,794 |
|
|
|
22,018 |
|
Restructuring charges(3) |
|
18,613 |
|
|
|
16,822 |
|
Share-based compensation |
|
3,058 |
|
|
|
6,040 |
|
Gain on sale-leaseback, net |
|
— |
|
|
|
(374,186 |
) |
Planned business divestiture(4) |
|
— |
|
|
|
1,864 |
|
Other(5) |
|
(523 |
) |
|
|
(557 |
) |
Adjusted EBITDA |
$ |
116,468 |
|
|
$ |
126,355 |
|
Rent expense associated with triple net operating leases(6) |
$ |
31,647 |
|
|
|
||
Adjusted EBITDAR |
$ |
148,115 |
|
|
|
||
|
|
|
|
||||
Net (loss) income margin |
|
(28.1 |
)% |
|
|
29.8 |
% |
Adjusted EBITDA margin |
|
18.8 |
% |
|
|
21.1 |
% |
| ________________________________ | ||
(1) |
Non-operating (income) expense includes: (i) change in value of commercial rights liabilities, (ii) gain on extinguishment of debt, (iii) non-operating items of equity method investments including our share of net income or loss on an investment and depreciation expense related to our |
|
(2) |
Includes acquisition, integration and other transaction related costs, financing costs incurred in connection with the prior year sale lease-back transaction, and costs incurred to address the Standard General takeover bid. |
|
(3) |
Restructuring charges representing the severance and employee related benefits related to the announced Interactive business restructuring initiatives and the closure of the Company’s Tropicana Las Vegas property on April 2, 2024. |
|
(4) |
Losses related to a North America Interactive business that Bally’s was marketing as held-for-sale in 2023. |
|
(5) |
Other includes the following items: (i) non-routine legal expenses and settlement charges for matters outside the normal course of business (ii) storm related insurance and business interruption recoveries, and (iii) other individually de minimis expenses. |
|
(6) |
Consists of the operating lease components contained within our triple net master lease with GLPI for the real estate assets used in the operation of Bally’s |
|
BALLY’S CORPORATION
Revenue and Segment Adjusted EBITDAR (unaudited) |
|||||||
|
Three Months Ended March 31, |
||||||
(In thousands) |
|
2024 |
|
|
|
2023 |
|
Revenue |
|
|
|
||||
Casinos & Resorts |
$ |
342,329 |
|
|
$ |
328,786 |
|
International Interactive |
|
234,683 |
|
|
|
245,572 |
|
North America Interactive |
|
41,470 |
|
|
|
24,362 |
|
Total |
$ |
618,482 |
|
|
$ |
598,720 |
|
|
|
|
|
||||
Adjusted EBITDAR(1) |
|
|
|
||||
Casinos & Resorts |
$ |
89,418 |
|
|
$ |
105,123 |
|
International Interactive |
|
83,532 |
|
|
|
80,301 |
|
North America Interactive |
|
(10,158 |
) |
|
|
(10,563 |
) |
Other |
|
(14,677 |
) |
|
|
(17,268 |
) |
Total |
$ |
148,115 |
|
|
|
||
| ________________________________ | ||
(1) |
Segment Adjusted EBITDAR is Bally’s reportable segment GAAP measure and its primary measure for profit or loss for its reportable segments. “Segment Adjusted EBITDAR” is Adjusted EBITDA (as defined above) for Bally’s reportable segments, plus rent expense associated with triple net operating leases for the real estate assets used in the operation of the Bally’s casinos and the assumption of the lease for real estate and land underlying the operations of the Bally’s |
|
BALLY’S CORPORATION
Selected Financial Information (unaudited) |
|||||||
Balance Sheet Data |
|||||||
(in thousands) |
March 31, 2024 |
|
December 31, 2023 |
||||
Cash and cash equivalents |
$ |
169,356 |
|
|
$ |
163,194 |
|
Restricted cash |
|
141,533 |
|
|
|
152,068 |
|
|
|
|
|
||||
Term Loan Facility(1) |
$ |
1,901,238 |
|
|
$ |
1,906,100 |
|
Revolving Credit Facility |
|
355,000 |
|
|
|
335,000 |
|
|
|
750,000 |
|
|
|
750,000 |
|
|
|
735,000 |
|
|
|
735,000 |
|
Less: Unamortized original issue discount |
|
(22,775 |
) |
|
|
(23,756 |
) |
Less: Unamortized deferred financing fees |
|
(38,093 |
) |
|
|
(39,709 |
) |
Long-term debt, including current portion |
$ |
3,680,370 |
|
|
$ |
3,662,635 |
|
Less: Current portion of Term Loan and Revolving Credit Facility |
$ |
(19,450 |
) |
|
$ |
(19,450 |
) |
Long-term debt, net of discount and deferred financing fees; excluding current portion |
$ |
3,660,920 |
|
|
$ |
3,643,185 |
|
Cash Flow Data |
||||||||
|
Three Months Ended March 31, |
|||||||
(in thousands) |
|
2024 |
|
|
2023 |
|
|
2022 |
Capital expenditures |
$ |
28,053 |
|
$ |
43,678 |
|
$ |
54,516 |
Cash paid for capitalized software |
|
13,583 |
|
|
7,143 |
|
|
14,956 |
Acquisition of gaming licenses |
|
1,211 |
|
|
1,900 |
|
|
860 |
Cash payments associated with triple net operating leases(2) |
|
29,951 |
|
|
29,094 |
|
|
10,000 |
| ________________________________ | ||
(1) |
In 2023, the Company entered certain currency swaps to synthetically convert |
|
(2) |
Consists of payments made in connection with Bally’s triple net operating leases, as defined above. |
|
View source version on businesswire.com: https://www.businesswire.com/news/home/20240501417901/en/
Investor
Marcus Glover
Chief Financial Officer
401-475-8564
ir@ballys.com
Media
James Leahy, Joseph Jaffoni, Richard Land
JCIR
212-835-8500
baly@jcir.com
Source: Bally’s Corporation
FAQ
<p>What was Bally's 's revenue for the first quarter of 2024?</p>
Bally's reported revenue of $618.5 million for the first quarter of 2024.
<p>Which segments showed revenue growth in the first quarter of 2024?</p>
Casinos & Resorts and North America Interactive segments showed revenue growth in the first quarter of 2024.
<p>What caused the decline in International Interactive revenue?</p>
The decline in International Interactive revenue was primarily due to operations outside the UK and a strategic shift for profit yield.
<p>What are Bally's 's 2024 revenue and Adjusted EBITDAR guidance?</p>
Bally's expects revenues in a range of $2.5 billion to $2.7 billion and Adjusted EBITDAR in a range of $655 million to $695 million for 2024.
<p>What significant closures or developments were mentioned in the press release?</p>
The closure of Tropicana Las Vegas and the development plans for the Las Vegas A's stadium were mentioned in the press release.
