CNTY - Earnings call transcript Q3 2021

Due to licensing restrictions, you must log in to view earnings call transcripts.

Operator

Welcome to Century Casinos, Q3 2021 Earnings Conference Call. This call will be recorded. At this time all participants will are in listen-only mode. Later we will conduct a question-and-answer session. I would like to introduce our host for today. Mr. Hoetzinger. Peter sir. begin, Please

Peter Hoetzinger

as And on for co-CEO the Century as Chairman everyone. Stapleton. Officer call. and our With of well Haitzmann, Erwin me call Casinos Chief thank morning, Financial joining Margaret you earnings the our Good on my

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

filing to In non-GAAP several and adjusted Reconciliations refer of a and addition, our results. limited can financial will of I section website news overview measures, measures our release appropriate we our session. will investor the cmtvy.com. performance available to throughout but not provide there be be the that found in third at EBITDA. the After an of to non-GAAP in GAAP measures call, quarter question-and-answer now including our liquidity SEC

higher or we XX% new by EBITDA EBITDA results the our listed record are over largest That point higher and of also if margin yesterday's and million, of XX%, it Very than second doubled company. market, any the resulting new XX% this the quarter second year flow of consolidated top year. a is adjusted third strong respectively, XX% they has revenue $XXX largest company. EBITDA all-time quarter to million of the third of been the quarter improvement. of consecutive quarter $XX.X and XX% reaction truly to of a sequential XX% sequential through the all-time and generated Our the last for for some for of set for me out the we year. is the quarter. that gaming the was outstanding. Revenues Considering on revenue exceeded not compared last growth records of of of QX improvements than And EBITDA stock numbers margin the of Sequentially, QX that, QX let XXXX.

and quarter focused philosophy across to operating spend profitable day margin profitable iGaming increased one in And We growth properties continued EBITDA betting effective move strength higher one. our our with customers. local was the sports more momentum And businesses. value was cost and showed our discipline, great Our QX regional for per right, points in is marketing XX% our on impressive visit All now high across saw of our since result than markets. more for our thing, us visitation, and performance has higher time targeted been let's and The us. database margin and all and it device QX. is QX on across

regional strong for demand, from benefit and to to preference entertainment. home continued We the close

as complicated strategy, well efficient and across our to in these has results our with that portfolio. as visitation together of disciplined levels All And casinos. operating improved great our spending

resulting the into from from our margins pressure some and We chain is our which structure most cost visit, increased inflation achieved valuable investments spend cost players. are labor record market targeted, for promotional translates and results Our supply operating disruptions. more more streamlined. per And other marketing challenging especially despite

and seeing to goods local hotels it And our margins. are operate at on impact Our able On labor have and busy great we're dealing meaningful be job a whether a of we inflation. weekend, shortages or not full F&B been teams with having doing on management pressures, capacity. the it inflationary wage outlets manage cost the

the labor capacity. we During of accommodate to however, to shortages, we all growth the operate hotel below market hotels these But our week, online some be able always as labor due bring rated And segments. had room even customers. will have able as more gaming normalizes, to grabbing not available to we from been rooms the a result, more revenue customer

our expand hours, structure. a Our business demand centric. from Only With picks as lower non-gaming cost up an only is non-gaming or amenities, coming gaming open largely overall the of minority opening revenue in resulting more further. is amenities,

grow options, impact haven't profitable margins. we At With way. more to operating as Las hasn't really any of to high marketing back quarter should changed competitors control. our X, That come a competitors are Vegas, disciplined that in environment their cost for aggressive and other most last example, the maintain attention of So even strongly. significant of quite being seen our point, entertainment over this regard the our from sustainability to has or started

customer, the application, Winters’ reinforcing information, great those customers. customer pace. betting It points, significantly convenience, offers The can and benefits, a entries building the balance, last and app point as value the to targeted of tier our new by example and expenses. mobile i-gaming from right are location, on tier, loyalty, operating saves in property, visit, the date et number Colorado mail through well direct will at increase live Revenue displays streamlining processes, level customers. convenience loyalty. will messages, be lots cetera on And and to date, amenities for with A current efficiency our the and and up great our app. app, as technology. With that that that out send initiatives focusing customer our further We is direct current It and opportunities and of for current also enhancing Zone brings promotional of to it continues great the [indiscernible] betting offers. success continue of we sports exclusive rolled the drawings already shortly. related of is at provides for And pari-mutuel the us it strong in

As upside very That us, capital. our the we at potential partnered any these our is companies scenario, approach know, a but experienced of proving we've you to limit from least currently prudent for side without efficient use believe the an one may in investment operations with run significant this whatsoever. optimistic

initiatives, Beyond about also we're our opportunities segment about these additional that mystery shortly. the growth in digital More excited notably Missouri. available most throughout in operations,

to much Let's expected in end now was sheet a history. point of cover and we financially any the off quarter company at Today, than liquidity. leverage to And balance Net at our million. it's With strength the $XXX performance are $XXX times. X.X our stronger outstanding operating The of $XX year-end. our cash of net just increased as debt by decline XX. further of position sits million, September at our debt current over million

asset maintained minimal to the requires maintenance current We base that maturities sustain have before levels of profitability. levels XXXX. debt CapEx substantial a of no And well with

of doubled clearly up starting was and and with XX% performance XXXX Central increased at and over our operating over segment XX% each strengthen XXXX Cripple surpassing Cripple last levels. very Colorado. Next, Adjusted ‘XX further last have the in Creek excellent a of Net an both and share quality high our for up market quarter and brief ‘XX XXX City strong points. EBITDA competitive it solidify XX%. of than and with up year. Creek, was over year. summary to The employee The by To was operating is to margin housing. our Central EBITDA more up Creek combined City, and casinos It properties in it compared X% provide position -- we properties remained Cripple decided revenues

expect to will We housing by our for build future September their employees. have apartments ready to of year. XX next of up current And and

team to individual in casino who well as so last approximately to remain at X-storey new and in of that gaming that a build and expected appear run developments had impact to rate. sustainable Emerson to and on about is River, will help on are promotional hotel revenues Missouri views develop Missouri a With more. hotel concerts, casino high records negative increased newly our of the hourly will Crossville, will current total. will when area to dining, in visit. up its September building us to Girardeau for the back Met that quality XX hotel they to Missouri, Moving more land operating direct run on actions riverboat the in July Bill area Again, in EBITDA a increase to paid of iconic open and the had spend riverboat bring Casino be Cape the not noted monthly results didn't wages to top Cape give CapEx significantly on expenses all Bridge. convenience plan efficiencies, will chance on over remaining also day EBITDA million In both will XX% and at non-floating stay X and for table designed order facility. Southeast $XX EBIDTA have Marketing a And and events in first one those including we announced our rooms will visits of continue gaming Cape and attract customers the hotel property below in be full Casino levels smarter history set QX continues resort gaming, so, a It volumes. margin customers. July as quarter. monthly for operational significant And at win Even XX%. by most providing our and development, terms adjusted The to competitive we in We rooms Cape increase more strong of minimum important pre-COVID In set style new any beautiful the members. to Missouri hotel and catchment XX% scenic with single destination, projects. flow is volumes. the Girardeau, Total for which by century come for include important drops facility mail will year, We group, property the was cash operations Girardeau the generation. XX XX%. to [Indiscernible] a we significantly the like the positions retain and Carousel last road development Mississippi properties. Girardeau. have room in months. led great market for provide highest and and us We’ve plan old conferences, advertising, Memorial

we aim XXXX. In don't timing, we XXXX or terms for clear visibility yet late have openings in of early but

outlets. F&B hotel operate destination business which Mountaineer was with from a operation. EBITDA character. with great to where quarter staffing last These It will They of and limited revenue Next opened of is in year. the West space over XX% results, & due And are really Mountaineer somehow Net because Resort. of its the but limited Racetrack adjusted are especially square hours third we Resort convention restrictions. draws increased wages of Casino, top up the of and that up XX% operating other usually Virginia The somewhat remains all lot stays, July. limited closed. -- on challenges we Same was

we these the for Warsaw of And business by Warsaw. So international casinos strong just for in performance casinos the tourists our EBITDA QX however, factors, considering year. the have uptick EBITDA to strong in a to just in exciting. expect and with solid the in And starting. quarter, back surpass come city Canada high We almost million is we to XX or mask. do a the hours challenges, levels to Adjusted operate Internationally, quite was That hopes all Despite outside the provide strongly All roundup maximum restrictions, everybody entry. numbers. before results business capital fueled EBITDA increase a highest negative convention need of of operations $X Casino. Poland of a and really XX% finish was Also Century generated I'm under vaccination revenue proof Racetrack report our Mile constituted happy test growth. the XXXX EBITDA those by required XXXX with COVID that wear reached to adjusted face taken operations. properties that net at operating guests & to And is finishes of a XX%.

have the of portion trends very the fourth optimistic a are significant consistently quarter. prove permanent. as going recent savings And expect forward, to relative continued we into cost the We

sustainable, XX multiple We we as have XX as improvements achieved margin for continued much maintain over this avenues the have is confidence growth, well that last performance we of of to months. that will and level the

our was to company bring return As And the normalizes, team. will and rooms host revenue the of will as performance increasing and our labor visitors to additional our pandemic we opportunities. our profitable capacity quarter to able hotel to continues customers, online, conclusion, our third amenities market another remarkable thus properties. In be increasing fade, the more other entire

customer robust Our focus our our generate the spreadsheet on in right entire tight history. highest portfolio and to margins producing continues the growth. And are EBITDA operating

ahead continued that can times. consistently our your the company's these manner Thank our the and acquisition please. U.S. find guests board, that model. we shareholder looking On we possible deploy capital thank enthusiasm Q&A I'd and to acquisitions. successful businesses the are stockholders builds And always you a broaden the value. On now further handful loyalty leverage start our balance will our pursuing all as like confident to of our behalf M&A of session. at And go for that With to members, value operating management to our challenging and been in strategic we front, are in opportunities and a We've their and strong and we oriented manage attention. discipline team our footprint sheet, during Operator, for not change. and opportunities

Operator

[Operator Stantial. Jeff question First is from Instructions]

Jeff Stantial

morning, a here. good and questions congrats set Hey, of for nice taking our Thanks on results

For lot a earnings we've about cycle question, here the my first U.S. this talked in trends

international the fairly cadence month-by-month thoughts stable I second. and witness of So since to Canada performance curious to Can your deceleration? the Poland? hear there. or ops focus it wanted reopening a bit their Has you a the respective for acceleration been any talk to about for Just on

Erwin Haitzmann

Yes. stable the much with measures. Pretty very in line various and

speed proof didn't So to growth restrictions. course, in produce Canada, of and as bit. have when Peter a [indiscernible] for before, have limits the vaccination. little a the we and of acceleration mask mentioned or That we a wear People have

test. visitors wearing safe. that which vaccines in been we have feel both customers have are And actually mask And to more frequency also means or to people both to and However, then visit a jurisdictions, wearing now the that in Canada, have used and to to various seen and that important been hesitant that -- more vaccinated across us more also being a and have longer. getting were do may stay people vaccinated

everywhere, of exception say all limits COVID in the with a the that see the growth bit. that can -- the we all, growth little or growth other So that we the one restriction only speed

Jeff Stantial

expectations one last can kind earnings? how for thanks. then the you’ve relative And to you my all does on the perfect. environment Poland on Okay, M&A Peter, that's sale? the up, talked me, follow any then U.S., update And the And provide in seller QX feel for about of okay,

Peter Hoetzinger

Poland, now ways. runs, less and sales smaller than process It like valuable. are runs Several are they getting In of are They relatively are And but or pretty But operations it that finding smaller basis. about slowly. EBITDA. off they're parties produce X% continues. on results. overall our quite These showing we and because consolidated interest nice X%

front situation the the M&A the And that's So there. on in U.S.

slowly it's Mirage. It's Tom to that think you the mean, mean MGM heard sell. I is starting. interested they're you've starting I in Rigg I Vegas. always selling saying

talk of apply? which depends multiple. in to apply yeah, And day And surely all of we and becoming terms on always slowly apply starting. on combination an about more available. but But valuation, to -- buzz you a to you it's So EBITDA properties the see, EBITDA it's long. finding right to. do market agreeing It you more So can

Jeff Stantial

it helpful. I'll correct. pass you Thank Very Okay, on. both.

Operator

The next question. David Bain. from It's

David Bain

amounts believe sort questions big I virtual larger bit like were lot you're and front. through you. environment and that on the on It of season, and to of you we the Understanding that addressed. potential? EBITDA, point? Are mentioned, through were you price? that little little tightened accumulation, them could baskets new of at Very like end. at to punch we you at quarter. gaming loosen can sellers to property to. looking cash more? product Peter, of XX seeing that million larger of sensitive right not of focused the bit. potentially Thank M&A just a your down up nice some world know baskets? there. that, a drill I of see but their product speaking valuations portfolios Can Are little maybe companies the up type A eminent being ones hearing of We this open spending Great. $XX mean, the you But bit, you were been on Sounds maybe earnings one always given larger seems a increasingly you've that looking the I

Peter Hoetzinger

should Yeah, secure Because with one property large payroll. the that. we're of have most starting see And, in so But in likely larger become companies at larger of the does to one only online business yeah, want this some And in those And pretty all to yeah, they throughout footprint the state. a state. available? that much the an companies. a state least seeing Absolutely. of do more have than to we're U.S., what surely, is they license from more the will and

David Bain

both sort has this energy then we too of was just Canada. drilling tad looking that U.S. reopening, have volatility? those historically sense of a is somewhat but outperformance Okay, was just like or have anything something maybe on caused sort down that be portfolio that the nice you not is here? radar, reiterating the prices maybe typically that are that's tailwinds were on well, And domestic the sustained for great. of give they something that we and And to you in expect kind anticipating. general, is Canada the much a wouldn't addressed same what that versus Because reincarnated? seeing has I that at on Maybe, as would And, know

Peter Hoetzinger

Erwin?

Erwin Haitzmann

Yeah.

the no But and of easing the [indiscernible] means obviously by there would guess development potential, of I because we numbers growth be restrictions, there. really that these is to is Further think be upside say the I that I longer restrictions should function the COVID forever. tried fueled will think earlier. which

enter and be we we restrictions potential so has about able will good Canada are that the And to feel that soon and it very growth -- as and it gone. growth reunite

David Bain

Anything on in energy U.S.? prices the there

Erwin Haitzmann

that does affect us affect It In it. not significantly. doesn't Canada,

David Bain

much. you right. All Okay. Thank great very Well, again. quarter

Operator

Your is next question from [indiscernible]. Kenneth

Unidentified Analyst

if the on restrict percentage can quarter. still think of answered. have a earn distancing full you social would of was amounts the if to business could money that on amount increase casinos. put But Great ability Do like most I that all basis a the I wondering I was your your would gone? you was just to percentage -- possible all question this

Erwin Haitzmann

But and I that's that. It's speculate look back time, Yeah. goal at it's the have to to mean, I one levels look hard the in is gradually problematic mind. to them. already at on come cost to And way EBITDA margins. with it, look we pre-COVID say. the I our all the levels. pre-COVID think first to to is at place, the in surpass to at looking EBITDA it revenue And at keep same wise then and that’s that’s really

Peter Hoetzinger

And which effect. open a on a some we percentages all also, have positions has weekend have do negative of busy not not But on we of yet. terms at tailgate our do ends casinos, a in detailed

Unidentified Analyst

very Okay, thank you much.

Operator

Instructions]. [Operator

is McDonnel Colin Your question from next [ph].

Unidentified Analyst

next of A of competitors have you people it to fixed And Hi before can force X,XXX ago, any to provide their come or casinos labor structure for back been statistic. had can -- information about the my XX,XXX XX,XXX. we just taking Thank Do X,XXX full think know similar would an And they said in run pace. Boyd guys interesting if the have you only a of I any year? casinos do could was about same you you down one few And that about don't so guys. at type provided cost guys thing. But your COVID. the weeks the questions. expected the they

Erwin Haitzmann

hand, If could we get you try to it don't we have that to at later.

Unidentified Analyst

Yeah, okay.

at year, know, estimate on looking for helpful. think many it's guys year know, sell -- And your the is numbers. million. street next don't $XX very I'm looking be And $XX other have thing million I very you but you this I that would just, and FactSet at side the analysts, for just

$XX in you of have EBITDA So last months. million XX guys done the

are -- is or missing to street blow what figure out like the something the going there I'm out just guys water. numbers So it something. missing to seems if communication of trying I'm is on the And you the --

Peter Hoetzinger

Yeah.

sure And I other quarter. that, think we numbers don't call to they than I'm will they give update after guidance. this and wanted be but it conservative.

So it's obviously understand in there. we

Unidentified Analyst

West But next Virginia is that worse any reason there year year? significant Colorado a have Missouri or or would this than year

Erwin Haitzmann

don't significant see We any reason. No.

Unidentified Analyst

Okay. Very helpful.

Erwin Haitzmann

We is think upside. that

Unidentified Analyst

Great.

you question. thank taking my Well for Okay.

Erwin Haitzmann

you. Thank

Operator

And from Beynon. is next question Chad

Jordan Bender

Bender is This Chad morning. on the Jordan Good today.

M&A, to REIT structure to you If look to possibly what would look want And or you optimal would your you And bring bigger? would to look continue guess I a at use go like? use leverage? where capital

Erwin Haitzmann

have not Our us. And also in revenue the U.S. Canada size, goal PopCo. but EBITDA OpCo. X OpCo, in from is in Colorado is on to in owned in acquired an by Mostly also numbers, scatter grow property yes. X we Caesars only we absolute Eldorado currently, that is

So can call we that's have good go certain clear a percentage. And don't -- like below a mix. don't we that we a

an we do but think really could or It's add fine on not asset, I another OpCo comfortable We opportunistic own HoldCo. We're the to basis. either some. easily owning more need we’re way. So

by How For HoldCo then other the us, the the market, more environment. that how the like specific are location The competitive far or asset, those important we whether asset more important environment, we OpCo. regulatory are the like can us things it's we then the to

Jordan Bender

then our Okay, perfect. actually obviously guess XXXX quarter. were Revenues over -- at the And least I Poland in outperformed levels. expectations

the where within looking casinos outside into thinking ones with kind of that of this kind model the fit in talked the casinos the quarter. about about how outperform just that of talk of Warsaw you You in Can kind ’XX? Warsaw your about segment

Erwin Haitzmann

Okay.

Peter Hoetzinger

the market the Marriott at Warsaw historically, the Warsaw of the six much outside in absolute country. stronger the And two than Warsaw combined. and outside and others Hilton That’s is numbers of

overall impact properties Warsaw numbers. on any of So the Poland the has a uptick Erwin? meaningful

Erwin Haitzmann

think Hilton, what are our happening and is are much Marriott we quarter at where I'm to that also guested the casinos. direction. both come the Right. getting We back if in customers coming and first we the in very business that occupancy accurate, higher and see looking on to I optimistic the Anytime

So as on the so same to the we're the casinos trend a in that the confident countryside. speak, follow Warsaw day next will was casinos

Jordan Bender

Nice Thank Awesome. you. quarter.

Operator

[Operator Instructions] Lang is from And that question [ph]. Daniel

Unidentified Analyst

Hi, guys, the just update there's nice committing on quarter. wondering I Poland point the at discussions review if sort Is was to this region or any strategic processes. the company any of there?

Erwin Haitzmann

We have mentioned said consists that Poland operation less It is I've has become consolidated X% operations. EBITDA or for about X% a small us. our of non-core than of -- and as X

to -- and happy it whilst good it not, flow to us. it. value, decide investment, for our If cash offer a not Poland great in have high a on very then returns words, So solid we If we're value EBITDA good If get we keeping. of is we get other for has so our had very dispose we in yes, plans. that generating get in do long-term strategically us

Operator

At this time, there are no further questions.

Peter Hoetzinger

you call for our Thank today. joining everyone

For of visit our call, the a Stay recording website goodbye. well of cnty.com. section the at results financial please and

Operator

today's conference. That concludes

You may disconnect. now

Century Casinos (CNTY) 5 Nov 212021 Q3 Earnings call transcript