Financial Performance - Total revenue for 2024 was $2,450.5 million, slightly up from $2,449.1 million in 2023, and significantly higher than $2,255.7 million in 2022[261] - The net loss for 2024 increased to $567.8 million compared to a net loss of $187.5 million in 2023 and $425.5 million in 2022[261] - Gaming revenue for 2024 was $2,051.7 million, an increase of $59.6 million from $1,992.0 million in 2023[263] - Non-gaming revenue decreased to $398.8 million in 2024 from $457.0 million in 2023, reflecting a decline of $58.2 million[263] - Total revenue for the year ended December 31, 2024 was $2,450,478, a slight increase of $1,405 or 0.1% compared to $2,449,073 in 2023[264] - Net loss for the year ended December 31, 2024 was $567.8 million, compared to a net loss of $187.5 million in 2023, representing an increase in net loss as a percentage of revenue from 7.7% to 23.2%[273] - Adjusted EBITDA for the year ended December 31, 2024 was $495.6 million, a decrease of $31.7 million or 6.0% from $527.3 million in 2023[274] - Adjusted EBITDAR for the Casinos & Resorts segment decreased by $58.5 million or 13.6% to $370.5 million in 2024 compared to $429.0 million in 2023[275] Operational Highlights - Consolidated Adjusted EBITDA is used as a key performance indicator, reflecting the company's core operating results and ability to service debt[258] - The company launched the Bally Bet Casino app in Rhode Island and expanded the Bally Bet sportsbook app's reach to 13 US states and Ontario[258] - The company disposed of portions of its international interactive business in Asia and transferred ownership of certain intellectual property into a purpose trust[258] - The company's total operating costs and expenses exceeded total revenue, resulting in a total operating cost percentage of 110.5% in 2024[261] - Revenue from the Casinos & Resorts segment increased by 6% to $1.01 billion, driven by the Bally's Chicago temporary casino, which contributed approximately $96.5 million[264] Financing and Investments - The company secured a $940 million financing arrangement for the construction of its flagship casino in downtown Chicago, with construction expected to begin in early 2025[258] - The company completed a sale lease-back transaction for $394.8 million in 2024, resulting in a gain of $209.8 million[306] - The company entered into a strategic construction and financing arrangement with GLP for the Bally's Chicago permanent casino, including up to $940 million in construction financing[308] - The company has committed to invest $100 million in Bally's Twin River by 2043, with $45.1 million remaining as of December 31, 2024[311] - Capital expenditures for 2024 were $199.8 million, down from $311.5 million in 2023, with a focus on the Bally's Chicago permanent facility[310] Cash Flow and Debt - Net cash provided by operating activities decreased to $114.0 million in 2024 from $188.6 million in 2023, primarily due to changes in working capital and increased foreign currency losses[289] - Net cash provided by investing activities was $97.8 million in 2024, a significant improvement from net cash used of $207.8 million in 2023, driven by a $111.7 million decrease in capital expenditures[290] - Net cash used in financing activities increased to $287.8 million in 2024 from net cash provided of $65.8 million in 2023, mainly due to higher long-term debt repayments[291] - As of December 31, 2024, the company has $1.89 billion in variable rate debt and $1.49 billion in unsecured senior notes, with a potential interest expense increase of approximately $18.9 million for a 1% rise in interest rates[328] Future Projects and Commitments - Bally's Chicago project includes approximately 3,400 slot machines, 170 table games, and 500 hotel rooms, with a total investment of at least $1.34 billion for the temporary and permanent casino[312][314] - The temporary casino commenced operations on September 9, 2023, featuring approximately 800 gaming positions and 3 food and beverage venues[312] - The company expects to spend approximately $133.6 million on the construction and development of the permanent casino, which is projected to open in 2026[312] - Annual fixed host community impact fees to the City of Chicago are set at $4.0 million, with additional performance guarantees provided by the company[313] Tax and Regulatory Matters - The effective tax rate for 2024 was (2.8)%, compared to (0.9)% in 2023, largely due to increased impairment charges within foreign entities[271] - The company's valuation allowance for deferred tax assets increased by $79.7 million during the year ended December 31, 2024, totaling $234.6 million[323] Currency and Sponsorship - Foreign currency transaction gains for the year ended December 31, 2024, were $10.3 million, compared to losses of $11.0 million in 2023[331] - The cumulative minimum obligation for interactive technology partnerships is approximately $52.4 million, extending through 2029[316] - The company has sponsorship commitments totaling $125.4 million, with contracts extending through 2036[315] Impairment and Asset Valuation - Impairment charges recorded in 2024 totaled $248.9 million, including $125.9 million related to intangible assets and goodwill in the International Interactive segment[267] - The carrying value of the International Interactive reporting unit was $2.3 billion as of October 1, 2024, with an estimated fair value exceeding this amount by 12%[321]

Core Insights - Bally's Corporation has appointed Mira Mircheva as Executive Vice President and Chief Financial Officer, pending regulatory approvals [1] - Mira Mircheva has over 25 years of experience in finance, previously serving as CFO of The Queen Casino & Entertainment and holding positions at Standard General and Goldman Sachs [2] - Bally's CEO Robeson Reeves and Chairman Soo Kim expressed confidence in Mircheva's ability to enhance the company's financial position and operational efficiency [3] Company Overview - Bally's Corporation is a global casino-entertainment company operating 19 casinos across 11 states, a golf course in New York, and a horse racetrack in Colorado [4] - The company holds OSB licenses in 13 jurisdictions in North America and has expanded its international reach with the acquisition of Aspers Casino in the UK [4] - Bally's operates a sports betting platform (Bally Bet), an iCasino platform (Bally Casino), and has a significant stake in Intralot S.A., a global lottery management business [4] Operational Details - Bally's employs approximately 11,500 staff and operates around 17,700 slot machines, 630 table games, and 3,950 hotel rooms [5] - The company has rights to developable land in Las Vegas at the site of the former Tropicana Las Vegas [5]

Revenue Performance - Company-wide revenue for Q4 2024 was $580.4 million, a decrease of 5.1% year-over-year[6]. - Casinos & Resorts revenue was $324.4 million, down 5.2% year-over-year, while International Interactive revenue declined 9.1% to $214.5 million[6]. - Total revenue for Q4 2024 was $580,365,000, a decrease of 5.1% from $611,670,000 in Q4 2023[20]. - International Interactive revenue for Q4 2024 was $214,477,000, down 9.1% from $235,980,000 in Q4 2023; adjusted revenue increased to $193,495,000 from $171,393,000[27]. - The Queen's four properties generated Q4 2024 revenue of $57.6 million and full-year revenue of $225.2 million[6]. Adjusted EBITDAR - Adjusted EBITDAR for the Casinos & Resorts segment declined 14.6% year-over-year to $80.9 million due to higher costs and lower revenue flow-through[7]. - Adjusted EBITDAR for Casinos & Resorts in Q4 2024 was $80,857,000, a decline of 14.6% compared to $94,656,000 in Q4 2023[20]. - U.K. online revenue grew 11.3%, contributing to a total International Interactive Adjusted EBITDAR of $81.6 million, down 12.4% year-over-year[8]. - The North America Interactive segment reported an Adjusted EBITDAR loss of $12.3 million, impacted by the transition to a new unified platform[9]. North America Interactive Segment - North America Interactive revenue increased by 24.4% year-over-year to $41.5 million[6]. - North America Interactive segment reported a loss of $12,345,000 in Q4 2024, compared to a loss of $9,844,000 in Q4 2023[20]. Cost Management and Operational Efficiency - The company aims to optimize its cost structure and enhance operational efficiency to create long-term value following the acquisition of Queen's assets[9]. - The company incurred $30.3 million in rent expense for Q4 2024 related to triple net leases[21]. Capital Expenditures and Debt - Capital expenditures for Q4 2024 were $44,070,000, slightly down from $45,252,000 in Q4 2023[25]. - Long-term debt, including current portion, decreased to $3,318,773,000 in 2024 from $3,662,635,000 in 2023[24]. - Cash and cash equivalents increased to $171,233,000 in 2024 from $163,194,000 in 2023[24]. Casino Developments - The construction of the permanent Chicago casino has commenced, with the demolition of the Tropicana site now complete[6]. - Bally's has received final approval for its permanent Chicago Casino master plan and is progressing on the integrated resort master plan for the Tropicana site[9]. Gaming Licenses and Currency Swaps - The company recognized $851,000 for the acquisition of gaming licenses in Q4 2024, significantly lower than $135,335,000 in Q4 2023[25]. - The company has entered into currency swaps to convert $500 million of its Term Loan Facility to a fixed-rate Euro-denominated instrument[25].

Group 1: Campaign Overview - Greater Good Charities and Bally Bet collaborated to raise 1 million meals for shelter pets across the country during the football season [1][2] - The campaign engaged football fans and pet lovers through social media, resulting in 50 to 100 pet meals donated per interaction [2] Group 2: Impact and Contributions - The campaign allowed animal shelters to redirect resources towards critical needs, such as medical care for pets [2] - A special partnership with the Cleveland Browns contributed 1,000 pet meals for every point scored during games [2] Group 3: Organizational Background - Greater Good Charities is a 501(c)(3) nonprofit that has invested over $750 million in impact since 2007, helping communities in 121 countries [3] - Bally's Corporation operates 19 casinos across 11 states and has a growing omni-channel presence, including a sports betting platform [4]

Core Viewpoint - Momentum investing focuses on "buying high and selling higher" rather than traditional strategies of "buying low and selling high" [1] Group 1: Momentum Investing Strategy - Momentum investors often face challenges in determining the right entry point for fast-moving stocks, which can lead to limited upside or downside risks [2] - A safer approach involves investing in bargain stocks that exhibit recent price momentum, utilizing tools like the Zacks Momentum Style Score to identify such opportunities [3] Group 2: Bally's Corporation (BALY) Analysis - Bally's Corporation (BALY) has shown a four-week price change of 1.4%, indicating growing investor interest [4] - Over the past 12 weeks, BALY's stock has gained 3.6%, with a beta of 2.04, suggesting it moves 104% higher than the market in either direction [5] - BALY has a Momentum Score of B, indicating a favorable time to invest based on momentum [6] - The stock has a Zacks Rank 2 (Buy) due to upward trends in earnings estimate revisions, which attract more investors [7] - BALY is trading at a Price-to-Sales ratio of 0.30, suggesting it is undervalued at 30 cents for each dollar of sales [7] Group 3: Investment Opportunities - In addition to BALY, there are other stocks that meet the criteria of the 'Fast-Paced Momentum at a Bargain' screen, presenting further investment opportunities [8] - The Zacks Premium Screens offer over 45 different strategies tailored to help investors find winning stock picks [9]

Group 1 - Bally's Corporation (BALY) is a casino entertainment company with a Zacks Consensus Estimate for its current year earnings revised 85.7% downward over the last 60 days [1] - Baxter International Inc. (BAX) is a healthcare products company with a Zacks Consensus Estimate for its current year earnings revised 33.1% downward over the last 60 days [1] - Central Garden & Pet Company (CENTA) is a lawn and garden products company with a Zacks Consensus Estimate for its current year earnings revised 5.8% downward over the last 60 days [2]

Group 1: Merger Announcement - Bally's Corporation has secured shareholder approval for its merger with The Queen Casino & Entertainment Inc., enhancing its Casino & Resorts segment and adding diversity to its portfolio [1] - The merger includes the integration of QC&E's four properties, with significant redevelopment projects expected to drive organic growth [2] Group 2: Financial Backing and Timeline - The transaction is backed by $500 million in committed financing and is anticipated to close in the first half of 2025 [2] Group 3: Price Performance - Shares of Bally's have gained 37.8% in the past six months, outperforming the industry growth of 15.6% [4] - The company benefits from strategic expansions, cost-effective customer acquisition, and a robust online sports betting operation [4] Group 4: Operational Challenges - Bally's faces operational challenges in Rhode Island and Atlantic City, along with slow approval processes for its New York casino proposal [5] - Analysts have widened loss estimates for 2024, indicating concerns about the company's long-term growth potential [5] Group 5: Current Zacks Rank - Bally's currently holds a Zacks Rank 4 (Sell) [6]

Business Operations - As of September 30, 2024, the company owns and manages 15 land-based casinos across 10 states in the US, with approximately 14,900 slot machines and 550 table games [195]. - The company entered into a Merger Agreement on July 25, 2024, involving the merger with Queen Casino & Entertainment, which will enhance its market presence [198]. - On October 31, 2024, the company agreed to carve out components of its interactive business in Asia for €30 million, focusing on North American and European markets [199]. - The company aims to increase revenues by enhancing guest experiences at its casinos and resorts, which includes popular games and high-quality service [196]. - The company has a strategic focus on interactive gaming as a significant growth opportunity, particularly in regulated markets [196]. Financial Performance - Consolidated Adjusted EBITDA for Q3 2024 was $630.0 million, slightly down from $632.5 million in Q3 2023, while total revenue for the first nine months of 2024 was $1,870.1 million, compared to $1,837.4 million in the same period of 2023 [214]. - The net loss for Q3 2024 was $247.9 million, compared to a net loss of $61.8 million in Q3 2023, indicating a significant decline in profitability [214]. - Total gaming revenue for Q3 2024 was $523.9 million, an increase of $15.0 million from $508.9 million in Q3 2023, while total non-gaming revenue decreased to $106.1 million from $123.6 million [218]. - General and administrative expenses increased to $273.6 million in Q3 2024, up from $230.6 million in Q3 2023, reflecting a rise in operational costs [218]. - The company reported a loss from operations of $157.7 million in Q3 2024, compared to income from operations of $37.2 million in Q3 2023, highlighting a significant operational challenge [214]. Cost Management - Gaming expenses as a percentage of gaming revenue remained stable at 45% for both Q3 2024 and Q3 2023, indicating consistent cost management in gaming operations [218]. - Interest expense, net, was reported at (11.7)% of total revenue for Q3 2024, slightly higher than (11.2)% in Q3 2023, indicating increased borrowing costs [216]. - The company’s total operating costs and expenses for Q3 2024 were 125% of total revenue, compared to 94.1% in Q3 2023, suggesting rising operational inefficiencies [216]. - The loss before income taxes for Q3 2024 was (44.7)%, a significant drop from (2.8)% in Q3 2023, reflecting deteriorating financial performance [216]. Revenue and Earnings Metrics - Consolidated Adjusted EBITDAR, which includes rent expenses, is used as a valuation metric and is critical for assessing the company's equity value in the gaming industry [212]. - Total revenue for Q3 2024 decreased 0.4% to $630.0 million, while total revenue for the first nine months increased 1.8% to $1.87 billion compared to the same periods in 2023 [219]. - The Bally's Chicago temporary casino contributed approximately $32.6 million and $64.2 million to revenue for Q3 and the first nine months of 2024, respectively [219]. - Adjusted EBITDAR for the Casinos & Resorts segment decreased by $17.7 million to $100.4 million for Q3 2024, and by $44.7 million to $289.7 million for the first nine months compared to the prior year [230]. Cash Flow and Investments - Net cash provided by operating activities for the nine months ended September 30, 2024, was $76.2 million, a decrease of 35.6% compared to $118.4 million for the same period in 2023 [239]. - Net cash used in investing activities for the nine months ended September 30, 2024, was $191.1 million, an increase of $188.8 million compared to $2.2 million in the prior year [241]. - Net cash provided by financing activities for the nine months ended September 30, 2024, was $75.7 million, compared to net cash used of $79.6 million in the same period of 2023 [242]. - The company issued $750 million aggregate principal amount of 5.625% senior notes due 2029 and $750 million aggregate principal amount of 5.875% senior notes due 2031 [245]. Regulatory and Compliance - The company is subject to a Regulatory Agreement with the Rhode Island Department of Business Regulation, which includes financial covenants and operational restrictions [205]. - The effective tax rate for 2024 was 0.8%, significantly lower than the 62.7% in 2023, primarily due to an increase in the valuation allowance [226]. Future Commitments and Plans - The Company plans to sell and lease back its Bally's Twin River property for $735 million, with initial annual rent of $58.8 million, expected to be completed by 2026 [261]. - The Company has a commitment to invest $100 million in Bally's Twin River over the term of its master contract, with approximately $48.2 million remaining as of September 30, 2024 [264]. - The Company has entered into a Binding Term Sheet with GLP for up to $940 million in construction financing for the Bally's Chicago permanent casino [260]. - The Company is required to pay annual fixed host community impact fees of $4.0 million in connection with the Bally's Chicago project [269].

Core Insights - Bally's Corporation reported $629.97 million in revenue for Q3 2024, a year-over-year decline of 0.4% and a surprise of -3.17% compared to the Zacks Consensus Estimate of $650.63 million [1] - The company posted an EPS of -$1.99, significantly lower than the -$1.15 from the previous year, with an EPS surprise of -696.00% against the consensus estimate of -$0.25 [1] Revenue Performance - Revenue from Casinos & Resorts was $353.36 million, slightly below the average estimate of $355.35 million, reflecting a year-over-year decrease of -1.6% [3] - International Interactive revenue reached $230.94 million, missing the average estimate of $237.80 million, marking a year-over-year decline of -5.3% [3] - North America Interactive revenue was $45.68 million, slightly below the estimated $45.80 million, but showed a significant year-over-year increase of +54.5% [3] Adjusted EBITDAR Metrics - Adjusted EBITDAR for Other was reported at -$13.16 million, close to the estimate of -$13.20 million [3] - Adjusted EBITDAR for International Interactive was $90.03 million, exceeding the average estimate of $83.73 million [3] - Adjusted EBITDAR for North America Interactive was -$10.98 million, worse than the average estimate of -$7.03 million [3] - Adjusted EBITDAR for Casinos & Resorts was $100.44 million, below the average estimate of $115.27 million [3] Stock Performance - Bally's shares have returned +0.3% over the past month, compared to a +0.7% change in the Zacks S&P 500 composite [4] - The stock currently holds a Zacks Rank 4 (Sell), indicating potential underperformance relative to the broader market in the near term [4]

Bally's Corporation (NYSE:BALY) Q3 2024 Earnings Call Transcript November 6, 2024 4:30 PM ET Company Participants Charlie Diao - Senior Vice President of Finance and Corporate Treasurer Robeson Reeves - Chief Executive Officer George Papanier - President Marcus Glover - Chief Financial Officer Operator Good day, everyone, and welcome to the Bally’s Corporation Third Quarter 2024 Earnings Conference Call. At this time, all participants are in a listen-only mode. Please be advised that today’s conference is b ...