Financial Performance - Total revenue for 2022 was $2,255.7 million, a significant increase from $1,322.4 million in 2021, representing a year-over-year growth of approximately 70.5%[251] - The net loss for 2022 was $425.5 million, compared to a net loss of $114.7 million in 2021, indicating a deterioration in profitability[252] - Consolidated Adjusted EBITDA for 2022 was $548.5 million, an increase of 66.3% from $329.9 million in 2021[266] - The net income (loss) for the year ended December 31, 2022, was $(425,546,000), compared to $(114,697,000) in 2021, indicating a worsening financial performance[271] - Cash provided by operating activities increased to $270,971,000 in 2022 from $82,754,000 in 2021, demonstrating improved operational efficiency[277] Revenue Breakdown - Gaming revenue increased by $792,632, or 75.2%, from $1,053,492 in 2021 to $1,846,124 in 2022[257] - The acquisition of Tropicana Las Vegas and other 2021 acquisitions contributed $868.7 million to total revenue[258] - Total revenue for the year ended December 31, 2022, was $2,255,705, an increase of 70.6% from $1,322,443 in 2021[257] Expenses and Costs - Gaming and non-gaming expenses accounted for 44.7% and 34.4% of total revenue in 2022, respectively, showing an increase in operational costs compared to previous years[253] - Total gaming expenses increased by $405.9 million, primarily due to acquisitions, resulting in total gaming expenses of $812,918[259] - General and administrative expenses rose by $230.4 million to $774,940, largely due to the inclusion of expenses from acquisitions[260] - Impairment charges rose to 20.6% of total revenue in 2022, up from 0.4% in 2021, indicating increased challenges in asset valuation[253] - The company reported total impairment charges of $463,978,000 in 2022, primarily related to the North America Interactive segment[271] Acquisitions and Investments - The company completed the acquisition of Tropicana Las Vegas, enhancing its presence on the Las Vegas Strip, and signed an agreement to develop Bally's Chicago[243] - The company launched Bally Casino and Bally Bet Sportsbook & Casino, expanding its online gaming solutions and positioning itself as a full-service iGaming company[243] - The company plans to continue investing in its land-based casino business and expand its interactive/iGaming operations[276] - The company is committed to invest approximately $100 million in Bally's Twin River over the term of its master contract, with a $60 million investment for a 40,000 square foot casino expansion expected to open in Q2 2023[295] - Bally's Chicago project involves a total investment of $1.7 billion, including 3,400 slots and a 500-room hotel tower, with a temporary casino expected to open in the second half of 2023[298] Debt and Financing - As of December 31, 2022, the company had $2.06 billion of variable rate debt outstanding under Term Loan and Revolving Credit Facilities and $1.50 billion of unsecured senior notes[315] - The company received $597,000,000 in revolver proceeds for the year ended December 31, 2022, compared to $375,000,000 in 2021, reflecting increased borrowing activity[282] - A hypothetical increase of 1% in the effective interest rate would cause an increase in interest expense of approximately $20.6 million over the next twelve months[315] Capital Return and Share Repurchase - The company has a Board-approved capital return program with a total expenditure of up to $700 million for share repurchases and dividends[283] - The company repurchased 4.7 million common shares at a price of $22.00 per share, totaling $103.3 million, and an additional 6,621,841 shares for $153.4 million during the year ended December 31, 2022[284] - As of December 31, 2022, there was $194.6 million available under the Capital Return Program for future share repurchases[284] Tax and Valuation - The company established a $60.1 million valuation allowance for deferred tax assets as of December 31, 2022, due to uncertainties in realization[310] - The fair value of trademarks was determined using a relief from royalty method, which utilized Level 3 inputs such as projected revenue and discount rates[308] - The company assessed its deferred tax liabilities and concluded they are not a sufficient source of income for the realization of deferred tax assets[310] Macroeconomic Factors - The company is facing macroeconomic challenges, including rising inflation and interest rates, which could impact consumer spending and operational costs[245] - The company does not believe that fluctuations in interest rates had a material effect on its business during the years ended December 31, 2022, 2021, or 2020[316] - The company has not historically used operational hedges or forward currency exchange rate contracts to manage currency exchange rate fluctuations[317]

Financial Data and Key Metrics Changes - Bally's Corporation reported revenues expected to be between $2.5 billion to $2.6 billion for 2023, with adjusted EBITDA projected at $660 million to $700 million, including $40 million to $50 million in losses from North America Interactive [14][15] - The company closed the Tiverton Biloxi sale, resulting in over $400 million in cash on the balance sheet and $3 billion in net debt, indicating ample liquidity for announced projects [15] Business Line Data and Key Metrics Changes - Casinos & Resorts reported $96 million of EBITDAR in the quarter, with a core portfolio EBITDA margin exceeding 36% [13] - International Interactive achieved approximately $89 million of EBITDA at a 39% margin, with the UK business growing 12% year-over-year [13] - North America Interactive reported $6 million of negative EBITDA, with expectations for significant cost savings from restructuring [14] Market Data and Key Metrics Changes - The UK market is experiencing consolidation, with Bally's gaining market share due to effective targeting and a high-quality tech stack [18] - In Asia, Bally's is seeing positive year-on-year growth, with a strong player base and improving margins [9][49] Company Strategy and Development Direction - The company aims to focus on profitable growth in North America Interactive and expand its omni-channel data capabilities [12] - Bally's plans to invest in growth opportunities in Europe, Latin America, and Asia, with a particular emphasis on iCasino and sports betting [9][10] - The company is pursuing a two-site approach for new casino bids, leveraging its recent Chicago bid experience [20] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the growth trajectory in Asia and the UK, while acknowledging potential consumer pullback starting in the second quarter of 2023 [52][49] - The company is preparing for upward pressure on wages due to a tight labor market but is focused on controlling costs [45][47] Other Important Information - Bally's is restructuring its Interactive segment to streamline operations and improve profitability [9] - The company is committed to maintaining a debt-to-EBITDA ratio below five times, expected to be achieved by mid-2024 [15] Q&A Session Summary Question: Success in the UK market - Management attributed success to market consolidation and effective targeting with a high-quality tech stack, leading to robust revenues [18] Question: Update on new casino bids - Management confirmed participation in the RFA process, seeing significant potential in the market and considering a two-site approach [20] Question: Headwinds in Japan - Management noted improved sentiment and market share in Japan, with positive margin control [22] Question: Differences in customer demographics - Management observed growth in unique customers and a shift towards younger demographics, particularly in table games [25] Question: Future consumer expectations - Management expects to exceed guidance if current consumer trends hold, but anticipates potential weakness starting in Q2 [52] Question: Temporary facility opening - Management confirmed the temporary facility is on track to open in summer 2023, with all necessary approvals accelerated [54] Question: Expansion into South America - Management expressed interest in the Brazilian market, viewing it as a significant opportunity for the Bally's brand [57] Question: Cross-marketing opportunities - Management confirmed cross-marketing benefits between regional and Las Vegas properties, enhancing customer engagement [59]

Business Overview & Strategy - Bally's operates three main businesses: regional casinos in the US, iCasino operations primarily in the UK and Asia, and interactive gaming including sports betting and iCasino in North America[3] - The company is evolving into a premier, omni-channel gaming leader with a focus on integrating physical and online experiences[4, 10] - Bally's is investing in new slot products to enhance player engagement and drive incremental revenue[16, 18, 20] - A unified gaming experience is being developed through a single wallet system to power cashless gaming and integrated play across physical and online platforms[26] Expansion & Development - Bally's Chicago is a flagship casino project expected to open in phases, with a temporary facility in Summer 2023 and a permanent facility in Summer 2026, targeting 45 million annual admissions[12] - The company acquired the Tropicana Las Vegas in September 2022 and is evaluating development opportunities[13] - Several property projects are underway, including redevelopment in Kansas City and Atlantic City, with the Chicago permanent facility expected to generate $250 million in EBITDAR at full run rate[9] Financial Performance & Outlook - The company provided 2023 guidance of $25 to $26 billion in sales and $540 to $580 million in Adjusted EBITDA[56] - Casinos & Resorts are expected to contribute over $14 billion in revenues and $460 million in EBITDAR in 2023[56] - North America Interactive is projected to have an Adjusted EBITDA loss of approximately $40 to $50 million in 2023[56] - The company has total net debt of $2987 billion as of January 3, 2023[58] - Bally's estimates a real estate value range of $12 to $14 billion based on monetizeable properties[62] Interactive Division & Cost Structure - Bally's is restructuring its North America Interactive business to improve profitability, with expected cost savings of $50 million through headcount reductions ($35 million net of growth) and disposition of non-core assets ($15 million)[45] - The company is live with iCasino in New Jersey with a 3%+ market share, aiming to grow to 6-8%, and is also live in Ontario[42] - Gamesys has a player-centric approach focused on enhancing the player journey, utilizing various tools such as incentive generators and churn predictors[49, 54]

Financial Data and Key Metrics Changes - For Q3 2022, the company reported $119 million of EBITDA from the Casinos and Resorts segment, with an EBITDA margin of 39.5% excluding Atlantic City [12][8] - Adjusted EBITDA for the quarter was impacted by $3 million of rent associated with the purchase of Tropicana Las Vegas, which closed on September 26 [12] - The company updated its 2022 financial forecasts, expecting revenues of $2.25 billion and adjusted EBITDA of $540 million, including $75 million of North America Interactive EBITDA losses [13][14] Business Line Data and Key Metrics Changes - The Casinos and Resorts segment showed strong performance, with Lincoln achieving nearly double-digit revenue growth and Atlantic City reporting $9.5 million positive EBITDA [8][12] - International Interactive had approximately $76 million of EBITDA at a 33.5% margin, with the UK showing a slight year-over-year increase and Asia down 3% on a constant currency basis [12][9] - North America Interactive reported $20 million of negative EBITDA, with $7 million of EBITDA drag from non-core assets [12][13] Market Data and Key Metrics Changes - New Jersey iGaming market share climbed to 3.5%, with a focus on broadening options for the bricks-and-mortar database [7] - The UK market showed a record performance, with expectations for continued growth in Q4 [9] - Asia experienced a 3.3% decline year-over-year, prompting a revision of marketing strategies to maintain profitability [9] Company Strategy and Development Direction - The company is focused on the optimal integration of its combined assets and continues to deliver strong free cash flow [6] - There is an emphasis on identifying non-core assets in North America Interactive that do not show a near-term path to profitability [16] - The company remains interested in potential acquisitions in the casino space and is exploring opportunities outside the US for Interactive growth [22] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the ongoing performance of the Casinos and Resorts segment and noted that October trends continued positively [14][15] - The company is preparing for potential outcomes related to the delayed UK white paper and remains optimistic about the market [20] - Management acknowledged macro factors affecting the Asian market but expressed confidence in future growth [27] Other Important Information - The company ended the quarter with $3.3 billion of net debt and has ample liquidity to fund announced projects [14] - Capital expenditures are expected to be $250 million for the year, with a long-term commitment to reduce debt to EBITDA below 5x by mid-2024 [13][14] Q&A Session Summary Question: How has October been trending? - Management indicated that October is performing well, with Casinos and Resorts continuing the positive trend seen in Q3, while the UK finished October up around 10% [14][15] Question: Can you elaborate on evaluating money-losing businesses in North America Interactive? - Management stated that they are closely examining assets that do not show a near-term path to profitability and will make decisions quickly [16] Question: What are the expectations regarding the new minister in charge of the white paper? - Management expressed positive first impressions of the new minister and noted that while the gambling review is important, it may not be the top priority [20] Question: What are the drivers of the softness in Asia? - Management attributed the decline in Asia to macro factors and expressed confidence in the region's potential for growth [27] Question: What is the long-term leverage target? - Management confirmed the target is to be below 5x debt to EBITDA by 2024 [40] Question: How flexible are share repurchases in light of potential slowdowns? - Management indicated that while they plan to continue share repurchases, they will evaluate the macro environment and prioritize funding for key projects [45]

Financial Data and Key Metrics Changes - Bally's Corporation reported $99 million of EBITDAR in the quarter, with Atlantic City contributing negative $3 million, resulting in an EBITDAR margin of 39.2% excluding Atlantic City [17][18] - International Interactive achieved approximately $83 million of EBITDA with a margin of 35.2%, while North America Interactive reported $17 million of negative EBITDA [18][19] - The company updated its 2022 financial forecast, expecting revenue between $2.2 billion to $2.3 billion and adjusted EBITDA of $535 million to $550 million, including $60 million of North America Interactive EBITDA losses [19][21] Business Line Data and Key Metrics Changes - In the Casinos & Resorts segment, Lincoln continued to outperform expectations, while Atlantic City underperformed with negative EBITDA of $3 million against expectations of positive $4 million [8][17] - International Interactive saw a 2% year-over-year increase in the UK on a constant currency basis, despite a 30% reduction in marketing spend [9][18] - North America Interactive is in ramp-up mode, with New Jersey generating nearly $3 million of NGR in June, and the company expects continued growth and profitability for the rest of the year [10][11] Market Data and Key Metrics Changes - The UK market experienced a flat quarter in Asia, with FTDs down due to a large affiliate promotion being moved to Q3 [9][10] - The company anticipates growth from its recently launched sportsbook, benefiting from the World Cup and increased uptake from its refer-a-friend program [10] - The company is targeting a 6% to 8% market share in New Jersey by 2023, with expectations of further growth in Pennsylvania and Ontario [11][45] Company Strategy and Development Direction - Bally's is focused on integrating its casino database to provide a unified wallet and omnichannel rewards, while developing proprietary technologies for unique customer experiences [12] - The company is prioritizing iCasino states and plans to focus resources on live markets, including Pennsylvania and Ontario, while preparing for potential iGaming regulations in other states [11][50] - Bally's Chicago project is a significant strategic initiative, with plans for a temporary facility opening in June 2023 and a permanent facility by June 2026, projected to generate substantial EBITDAR [15][16] Management's Comments on Operating Environment and Future Outlook - Management acknowledged global turbulence but emphasized strong cash flow generation from Casinos & Resorts and International Interactive segments as critical success factors [7] - The company is cautious about inflationary pressures and is closely monitoring costs while expecting improvements in Atlantic City [8][26] - Management expressed confidence in the UK consumer base strengthening and the potential for improved performance in the second half of the year [44][69] Other Important Information - Bally's ended the quarter with $3.4 billion of debt and $176 million of cash, maintaining ample liquidity for announced projects [20] - The company announced a real estate sale to GLPI, expected to bring in $635 million in cash proceeds, with plans for further evaluations of potential sales [21] - Bally's is committed to maintaining a debt-to-EBITDA ratio below five times by mid-2024 [20][78] Q&A Session Summary Question: Update on FX impact on EBITDA - Management indicated a 10% FX impact resulting in a $20 million hit to EBITDA, factoring in Asian currencies [24] Question: Update on consumer trends in brick-and-mortar business - Management noted that trends from Q1 have continued, with some softness in lower-income areas but overall stability [26] Question: Chicago project next steps and risks - Management expressed confidence in the project timeline and budget, addressing inflation and supply chain risks [30][32] Question: Confidence in EBITDA forecasts for Chicago facilities - Management highlighted strong visitation trends and community engagement as key factors supporting their EBITDA forecasts [34][39] Question: International Interactive marketing reduction impact - Management reported a 9% reduction in FTD count despite a 30% decrease in marketing spend, indicating efficiency in marketing strategies [42][44] Question: Market share goals in New Jersey and other states - Management is targeting a 6% to 8% market share in New Jersey by 2023, with plans for expansion in Pennsylvania and Ontario [45][50] Question: Strategy for sale-leaseback transactions - Management discussed the potential for future sale-leaseback transactions, emphasizing the importance of strategic asset management [56] Question: Promotional environment across properties - Management noted stable margins and a focus on higher-end customer segments, with no significant impact from competitors [58][60] Question: Update on New York downstate casino opportunities - Management remains interested in potential opportunities and is exploring sites, awaiting the RFP process [70] Question: Expectations from the new UK prime minister on gambling regulations - Management does not expect significant changes in the regulatory landscape, anticipating a stable trajectory [73] Question: Capital strategy and leverage outlook - Management outlined a focus on maintaining a strategic balance between owned and leased assets, with a goal of sub-five times leverage by mid-2024 [77] Question: Preemptive actions regarding the UK white paper - Management has been preparing for potential regulatory changes and has adjusted strategies accordingly [79]

Bally's Corporation (NYSE:BALY) Q1 2022 Earnings Conference Call May 5, 2022 8:00 AM ET Company Participants Bobby Lavan - Chief Financial Officer Lee Fenton - Chief Executive Officer George Papanier - President-Retail Conference Call Participants Jeff Stantial - Stifel Barry Jonas - Truist Securities Ricardo Chinchilla - Deutsche Bank Dan Politzer - Wells Fargo David Katz - Jefferies Stephen Grambling - Goldman Sachs Operator Good day and thank you for standing by. Welcome to the Bally’s Corporation First ...