Bally's (US:BALY)2023-02-28 16:00Financial 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]