CNTY - Earnings call transcript Q4 2018

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Operator

Welcome to Century Casinos Q4 2018 Earnings Conference Call. This call will be recorded. At this time, all participants are in a listen-only mode. Later, we will conduct a question-and-answer session. I would like to introduce your host for today's call, Mr. Hoetzinger. Peter Mr. begin. may you Hoetzinger,

Peter Hoetzinger

well morning, everyone, call. Co-CEO joining earnings Haitzmann; you the of Vice Finance, Margaret and me on thank Stapleton. as Erwin With Casinos, my of for our the Executive Chairman President our Century Good as call and are

filings. future to risk statements. will actual whether update detailed from number or begin, as SEC and to a of revise we'd various or we uncertainties remind these we the Company in factors forward-looking results information, result materially statements, forward-looking of The otherwise. that you to we and new discussing events the obligation forward-looking which you filings, cause to no a risks our provide We differ Before that our may discussion of like be undertakes encourage information, involves a review

refer well throughout the found of but news adjusted for Investors limited full and cnty.com. our to, of call, addition, of in available and In results filings, Company's measures in several section SEC performance for we including, measures, can non-GAAP be not GAAP measures non-GAAP liquidity Reconciliations financial EBITDA. as review our quarter will to our appropriate fourth XXXX. the brief financial now our I website as provide release year our a the at the to

a session. will Q&A the prepared remarks, be there Following

related due closure XXXX revenue in Poland to in Consolidated lost situation XX% and to Poland. an compared year casino we last was revenue, to in up report net all in EBITDA XXXX, license happy XXXX. of lower delays licensing are operating the record because throughout that the We the million even previous time over extra costs in to $XX approximately annual though year, annual

X% our a In operations generated Casino Greater annual one-third XXXX the of in & and Poland, segment overall for On generated have in business volumes the our If operations strong year-over-year quarterly our last demand EBITDA over casino for you higher was increase previous generating $X both approximately resulting quarter the Canada operating a revenue X% basis, adjust segment, Casino which X%. EBITDA our of EBITDA. QX EBITDA. and and own revenues, of a thirds EBITDA with In mainly The that, strong gaming continued basis, are year. been last over certainly per EBITDA. was Northlands an Hotel million, Albert, the EBITDA gains remains in Century by year, closed to was closes XXXX, down Canadian going market, grew Edmonton local X% casinos year impact currency, increase. January and consolidated adjusted this St. The versus in in revenue wage operate competitor minimum and two and results, a by two our positive we Edmonton Century due end Park grew the Edmonton Canada strongest increasing would EBITDA up be forward. will our on over for just mid property net Poland February to the increases. last for the to of have good. On declined from would That for revenue year's or U.S. fourth of and in by year. up XX% On reasons mentioned. X% XXst revenue revenue X%. I Casino, XX% Adjusted

and strong continues of and Downs strong that performed larger an the betting racing than generated results on driven slowed a very operations snowstorm really business consolidated by show to well X%, Creek Eve, bit. XX% XX% two Unfortunately, the and contributing and revenues EBITDA the Our margin during down In Casino, a of increased revenue crowds XX%. EBITDA. down with the revenues year. the growth EBITDA in were success. Results in Century contributed were last up overall of Racetrack Year’s weekends and strong by two around to quite our our which of New hit a had U.S., which Calgary Cripple casinos The market X%. in with XX%, the the XX% racing higher okay side business Colorado EBITDA quarter days

is tourist We to in continued promotions. the with a growth promotional of business million and guest player casino our our positioning activities solid are in strict focus more anticipated. data the and strong reported $X.X loyal great rules our the quarter. a the customers to Very Over the regulations than and following best slow, makes ramping the already. on regulations gaming regional as up marketing and limiting Europe, further city casino, by interaction opened properties food, outlook the have UK authorities the newly promote responsible title, regulatory general protection economic and fan project in Bath that We due service lost positive maintained development, difficult and and conditions, great We strong in market. and

and competitors maximum However, of help was the machines this What April this issue our betting down shops was just revenue in is local In stake the we XX% up EBITDA. also total £XXX our revenue XX% to of also at applies currency, of progress. reduction as to quarter as XX%. for up generated should year. effective the EBITDA Company's from In of our an casinos of become Poland, and less £X, should and of XX% the

look on ships generating up XXXX ships but Poland our closing in revenues but and From was negatively We smaller QX Overall, this the Argentina, forward only okay down much normal XXXX. operations developing on in now. very is local and by mentioned, for to are keep Argentina impacted on small planned, Polish EBITDA. scale contributing the between currency, the larger the Vietnam EBITDA already was As small things a casinos to ones. the forward. Poland in we not to licensing high step-by-step, going back as and segment in Vietnam now delays get and margins QX business in and is in USD.

$XX Now, sheet in debt million X.X. a is liquidity. ratio adjusted and our total quick debt. EBITDA equivalents to net EBITDA at The in is cash outstanding $XX the look million ratio and cash balance X.X, There's debt-to-adjusted and

Our $XX related $XX to at million Bank related includes of sits lease, $X gaming agreement, The to Century at million credit England. million and long-term share Downs land namely the Poland was $X debt value Montreal Bath, and spent over per our of the million on Casinos surveillance revenues, book quarter $X equipment. existing operations or for $X. during at X% million just CapEx the

with track private largest restaurants, total the quarter. XX That Casino a square plus a our $XX suites will a multilevel spent in and below project off bars, feet, of will grandstand Mile accommodating Century XX slot the initially Edmonton, with It open parking million at machines VLTs, be XXX in electronic million we table X,XXX Racetrack lounges, building XX On and USD betting XX,XXX to-date, will time facility the budget. and significant style games, on stadium convenient games, most and parlor, cars. over for come

be the Edmonton, XX% used main location twice Canada. the For parlors southern size the course is larger airport, comparison, that northern is one the facility highways in successful an Mile, already It hotels, and the will QE Calgary Calgary. XX pari-mutuel the to Downs our to building exiting most ideally of close businesses. Through The and of abundance heavily off-track and almost betting assume off the corridor between operation footprint positioned, Western mall, other highway, in and we shopping Alberta. retail adding Century II of be betting of off-track in which will golf our and internet Century Alberta, in operation outlets, operated the by horse Century the Bets! already is business the

and open today X. on three casino, sports-bar restaurant, April betting off-track lounge in weeks the We will from

On development end can your open doors. horse this the the racing the race we go can you weekend attention. we really start can't great first It’s XX, XX presentation. the April of that, ahead time progress Thank for X for racing thoroughbred see mile starting follow to opening with grand April session. and entire now on on the Christina, Q&A to I And the of season the please. wait project track the the XXth. facility we celebrate and its With exciting

Operator

Instructions] from Stifel. comes Please question Our first Boyer state your [Operator question. from you. Brad Thank

Brad Boyer

my question, for Peter. taking Thanks

First on Poland. just question is

quarter You saw a around nice X%. here fourth margin to tick the up in in the

of Just you work Poland of about ramp how in back towards renewal margin some mid-teens licensing level curious, thinking noise? to the we are as saw the to from prior kind low that we that here

Peter Hoetzinger

we That’s the get XX%, we and been of mid-teen and there staffing -- costs line. the extra as to because some maximum margin much Yes. to had of certainly And pretty can of still have just pushes we because gaming in some QX, the getting previously. some you the EBITDA operations reopened were tax we is we make, know marketing the levels and In goal. had

So, we the obviously those that's are revenue, then are margin. the working on drives things but EBITDA incremental what really because and

we So, we our way mid-teens. Poland, gradually think, in and to shape are are good up in I those working -- back we're

Brad Boyer

Okay.

it levels? a gradual be into should as think ramp XXXX you So, kind of we of sort those to back move here

Peter Hoetzinger

think, Yes. be. what would That's it we

Brad Boyer

And Edmonton. Northlands since Thanks. shutdown of second Park question, a then, Okay, in been now weeks it's perfect. up couple

Just curious of at wake Edmonton Northlands the Park Albert and in seeing St. what you're closing?

Peter Hoetzinger

Erwin?

Erwin Haitzmann

an far away. St. in I if Edmonton, But, see may effect, so. geographically Yes. do Albert We in just a we lot see don't that's too say because

Brad Boyer

you on about then, just Okay, order a little of in portfolio taking a and bit update where Peter, thanks. stands about the expand kind here in back kind to to deal your your get a to in of done? of leverage I know kind where deals the of that us you're maybe and/or you us U.S., talked And curious potentially you. past, could comfortable give desire sense to

Peter Hoetzinger

see larger for $X larger quite peers between interesting as of do our a XX XX, are of and coming EBITDA market getting them. getting small that We too Yes. properties many million do to assets number and

Leverage, So, not yes, feel comfortable we if is X.X that market out there, would time. think, over the X, to there maximum period of in an active market. I leverage we and are longer take we would active

feel below we So, that. comfortable

Brad Boyer

thanks. a XXXX? you Okay, last how keeping question. for house thinking then, CapEx just sense give me, of And about you’re it’s for you one us a Could

Peter Hoetzinger

Peggy, here? - or add you Erwin can contribute

Erwin Haitzmann

properties of in just the nothing shape, of think, as some ordinary. good so machines always out I just the and we replacement did keeping slot

Brad Boyer

and So, it of that means between revenue, historically? X% has what that’s X% probably been

Erwin Haitzmann

Yes.

Operator

question Mike Capital. Malouf instructions] from from Please state your comes [Operator Craig-Hallum question. Our next

Mike Malouf

my a could of this little that. at in we’re haven’t bit taking that I just a high for Thanks been Great. margins wondering When if you look a looking sustainability I comment the am at questions. take St. while. on little Albert,

Erwin Haitzmann

Erwin. is This

think sustainable. I it’s

start to good consistently a now. working been they and strong working have things have show and We very management and with diligently there,

it there’s why So, no reason shouldn’t stay.

Mike Malouf

great. which It back bit Okay, then, Poland, little mid color just you is more on up a you’re into great. marching if And like teens, could. sounds the

XX% going couple think the on there? years close soon sort think or Do next XX on get the at we -- XX% you’re you year, of to then, competition high think, I comment more just a get that do up of be is ago. you to to level? of that just a up like can to can XX%, How this maybe going it year and that’s you

Erwin Haitzmann

really EBITDA. we It’s ideally the were, to regard want with goal and EBITDA where not easy better. predict mean, to back the I year so be even whole is to

say maybe this. me Let

Marriott of third that will opening very And floor significantly which will beginning a -- Marriott the same give on having to will but even certainly we existing the can on further. room, increase because we casino us third our extra within But, significant are think at obviously management. floor, has the when at good. we would But, I We costs reach. too extension without exactly don’t the which same of predict in or license, the it’s yes, the more looking business potential the an much April into think be happen, casino volumes

Mike Malouf

on decision And curious, I of expect about with what there? should to just kind then, Vietnam. am of kind you timing great. anything didn’t expansion regards mention Okay, any we

Peter Hoetzinger

end the Yes. of Not year. before the

year existing want we And make what us We to has, impact and are small then until decision. watch least and upgrading give an end of investing summer the a it the at of towards the or facility. of kind the some amounts to end

Operator

this at questions turn to call further over Peter Hoetzinger. no I are time. There back the

Peter Hoetzinger

call. Thank right. for participation and your you everyone. interest All Century your Casinos the in you, in Thank

the at of section financial recording a cnty.com. website results For visit bye. the call, our Good please of

Operator

This concludes Thank today’s for call. conference you attending.

Century Casinos (CNTY) 11 Mar 192018 Q4 Earnings call transcript