Bally's (BALY) - 2024 Q1 - Quarterly Results

Bally's Corporation Q1 2024 Earnings Release Bally's Corporation announces its first quarter 2024 results, detailing financial and operational performance, segment contributions, and reaffirmed full-year guidance Financial & Operational Highlights Bally's Corporation reported a 3.3% revenue increase to $618.5 million, driven by Casinos & Resorts and North America Interactive, resulting in a $173.9 million net loss compared to prior year's gain Q1 2024 Financial Summary (vs. Q1 2023) | Metric | Q1 2024 (in millions) | Q1 2023 (in millions) | Change | | :--- | :--- | :--- | :--- | | Consolidated Revenue | $618.5 | $598.7 | +3.3% | | Casinos & Resorts Revenue | $342.3 | $328.8 | +4.1% | | International Interactive Revenue | $234.7 | $245.6 | -4.4% | | North America Interactive Revenue | $41.5 | $24.4 | +70.2% | | Net (Loss) Income | ($173.9) | $178.3 | N/A | | Adjusted EBITDAR | $148.1 | N/A | N/A | - Successfully launched iGaming in Rhode Island as the sole provider[2] - Closed the Tropicana Las Vegas on April 2nd to prepare for the Las Vegas A's stadium development on a portion of the site[2][7] Management Commentary & Segment Performance Management reported a solid start to 2024 with revenue growth in Casinos & Resorts and North America Interactive, while International Interactive's decline was a strategic shift towards profitability Casinos & Resorts The Casinos & Resorts segment revenue grew 4.1% driven by the Chicago Temporary Casino, though Adjusted EBITDAR declined due to weather, adverse hold, and Tropicana wind-down - Segment revenue grew 4.1% YoY, driven by the Chicago Temporary Casino[4] - Adjusted EBITDAR declined due to January weather, adverse hold, reduced access to the Twin River, RI property, and the Tropicana Las Vegas wind-down[4] - The Chicago Temporary Casino is showing positive results with month-over-month revenue improvement in Q1, driven by enhanced VIP amenities and improved property access[6] - The Tropicana Las Vegas officially closed on April 2nd, with demolition planned for later in the year to make way for the Las Vegas A's stadium[7] International Interactive International Interactive revenue decreased 4.4% to $234.7 million due to a strategic shift prioritizing profit, yet Adjusted EBITDAR grew 4.0% with strong UK performance International Interactive Q1 Performance | Metric | Q1 2024 (in millions) | Q1 2023 (in millions) | Change | | :--- | :--- | :--- | :--- | | Revenue | $234.7 | $245.6 | -4.4% | | Adjusted EBITDAR | $83.5 | $80.3 | +4.0% | - The revenue decline reflects a strategic shift to maximize profit yield instead of pursuing uneconomic growth, leading to challenging YoY comparisons[5] - Core UK interactive operations grew revenues by 12% (7% on a constant currency basis) due to market share gains[3][5] - The company anticipates benefits in Spain from the removal of advertising restrictions and plans to launch online sports betting (OSB) in the UK[5] North America Interactive North America Interactive revenue surged 70.2% to $41.5 million, driven by market share gains in New Jersey and Pennsylvania, and the successful iGaming launch in Rhode Island North America Interactive Q1 Performance | Metric | Q1 2024 (in millions) | Q1 2023 (in millions) | Change | | :--- | :--- | :--- | :--- | | Revenue | $41.5 | $24.4 | +70.2% | | Adjusted EBITDAR | ($10.2) | ($10.6) | +3.8% | - Successfully launched iGaming in Rhode Island in early March, with revenues ramping up as expected through April[6] - iGaming operations in New Jersey and Pennsylvania continue to gain market share[6] Corporate Strategy Bally's is committed to improving financial performance through disciplined cost management, streamlining, and centralizing operations to enhance efficiency - Bally's operating teams are focused on reducing expenses and enhancing operating efficiency by streamlining and centralizing operations[7] 2024 Guidance Bally's Corporation reaffirmed its full-year 2024 guidance, projecting revenues between $2.5 billion and $2.7 billion and Adjusted EBITDAR between $655 million and $695 million Full-Year 2024 Guidance (Unchanged) | Metric | Guidance Range | | :--- | :--- | | Revenue | $2.5 billion to $2.7 billion | | Adjusted EBITDAR | $655 million to $695 million | - Guidance incorporates the impact of the Tropicana Las Vegas closure, the ramp-up of the Chicago Temporary Casino, growth in International Interactive, and the new iGaming operations in Rhode Island[8] Financial Statements & Reconciliations This section provides unaudited condensed consolidated financial statements for Q1 2024, including statements of operations, GAAP to non-GAAP reconciliations, segment performance, and selected balance sheet and cash flow data Condensed Consolidated Statements of Operations Bally's reported Q1 2024 total revenues of $618.5 million, with a $74.0 million operating loss and $173.9 million net loss, primarily due to a prior-year sale-leaseback gain Q1 2024 Statement of Operations Highlights | Line Item | Q1 2024 (in millions) | Q1 2023 (in millions) | | :--- | :--- | :--- | | Total Revenue | $618.5 | $598.7 | | Total operating costs and expenses | $692.4 | $222.0 | | Gain from sale-leaseback, net | $— | ($374.2) | | (Loss) income from operations | ($74.0) | $376.7 | | Interest expense, net | ($73.1) | ($63.3) | | Net (loss) income | ($173.9) | $178.3 | | Diluted (loss) earnings per share | ($3.61) | $3.24 | Reconciliation to Adjusted EBITDA & EBITDAR Bally's reconciled its Q1 2024 net loss of $173.9 million to Adjusted EBITDA of $116.5 million and Adjusted EBITDAR of $148.1 million, with an Adjusted EBITDA margin of 18.8% Q1 2024 Reconciliation from Net Loss to Adjusted EBITDAR | Line Item | Q1 2024 (in millions) | | :--- | :--- | | Net (loss) income | ($173.9) | | Interest expense, net | $73.1 | | Provision for income taxes | $31.4 | | Depreciation and amortization | $159.7 | | Other adjustments (restructuring, transaction costs, etc.) | $25.1 | | Adjusted EBITDA | $116.5 | | Rent expense associated with triple net operating leases | $31.6 | | Adjusted EBITDAR | $148.1 | Segment Performance Data In Q1 2024, Casinos & Resorts led with $342.3 million revenue and $89.4 million Adjusted EBITDAR, followed by International Interactive, while North America Interactive reported a $10.2 million Adjusted EBITDAR loss Q1 2024 Revenue and Segment Adjusted EBITDAR | Segment | Revenue (in millions) | Adjusted EBITDAR (in millions) | | :--- | :--- | :--- | | Casinos & Resorts | $342.3 | $89.4 | | International Interactive | $234.7 | $83.5 | | North America Interactive | $41.5 | ($10.2) | | Other | N/A | ($14.7) | | Total | $618.5 | $148.1 | Selected Balance Sheet & Cash Flow Data As of March 31, 2024, Bally's reported $169.4 million in cash and $3.68 billion in long-term debt, with Q1 capital expenditures of $28.1 million Balance Sheet Data | Item | March 31, 2024 | December 31, 2023 | | :--- | :--- | :--- | | Cash and cash equivalents (in millions) | $169.4 | $163.2 | | Long-term debt, including current portion (in billions) | $3.68 | $3.66 | Cash Flow Data | Item | Q1 2024 (in millions) | | :--- | :--- | | Capital expenditures | $28.1 | | Cash paid for capitalized software | $13.6 | About Bally's Corporation & Disclosures Bally's Corporation is a global casino-entertainment company managing 15 casinos and interactive gaming platforms, pursuing growth through new developments, with this report containing forward-looking statements - Bally's currently owns and manages 15 casinos across 10 states, with approximately 15,000 slot machines, 550 table games, and 3,900 hotel rooms[14][15] - Future projects include a permanent casino in Chicago and a land-based casino in State College, PA, which will bring the total to 16 casinos across 11 states[15] - The press release includes a standard cautionary note regarding forward-looking statements, advising that actual results may differ materially from projections[16]