Full House Resorts(US:FLL)2021-05-11 03:07Financial Data and Key Metrics Changes - Consolidated revenues for Q1 2021 increased by approximately 37% to $42 million compared to the same quarter last year, with a 4% increase compared to Q1 2019 [5] - Adjusted EBITDA improved to $10.8 million, an increase of over $12 million compared to Q1 2019, attributed to labor efficiencies and refined operating hours [5][6] - On a trailing 9-month basis, adjusted EBITDA is over $33 million, indicating a strong position as the company moves into typically stronger quarters [6] Business Line Data and Key Metrics Changes - The newly created segment for contracted sports wagering generated nearly $1 million in Q1 2021, up from about $400,000 in the same period last year, due to more skins being live [8][24] - Mississippi operations performed well, benefiting from a refurbished casino and the absence of Mardi Gras in New Orleans, which typically draws visitors away [14] - Indiana reported $1.1 million in income for Q1 2021, a significant improvement from a loss in the same quarter last year [19] Market Data and Key Metrics Changes - The company noted strong performance in Mississippi and Indiana, while Colorado faced parking challenges due to ongoing construction [34] - Northern Nevada showed resilience despite COVID-related restrictions, with expectations for improved performance as restrictions ease [23] Company Strategy and Development Direction - The company is focused on the Chamonix growth project in Cripple Creek, Colorado, with $180 million remaining to complete the project [10] - Future projects are being considered in Waukegan, Illinois, and at the existing Silver Slipper property, with a commitment letter signed with a private equity firm for the Waukegan project [11][26] - The company aims to maintain a clean balance sheet and has issued new equity to strengthen its financial position for upcoming projects [11][12] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the return of older clientele as vaccination rates increase, which is crucial for business recovery [36][54] - The company anticipates that the strong performance seen in Q1 2021 may not be sustainable without ongoing stimulus checks, but remains focused on maintaining operational efficiencies [31][33] - Management highlighted the importance of adapting to changing consumer behaviors post-pandemic, including the potential for increased regional casino visits as people seek entertainment options [59] Other Important Information - The company has $278 million in cash at the end of the quarter, including $180 million in a restricted account for the Chamonix project, marking a historical high for cash reserves [13][29] - The company is actively managing construction costs for the Chamonix project amid inflation and material cost challenges, with contingency plans in place [41][42] Q&A Session Summary Question: How have trends been in April and May on gaming revenue and margins? - Management reported strong performance continuing into April, with expectations for a return to more normal revenue levels as stimulus checks are not expected to continue indefinitely [31][32] Question: Have you seen a change in traffic at the Silver Slipper post-restrictions lifting? - Management noted a positive trend in older clientele returning, which is crucial for business, while efforts are being made to retain younger customers [36][54] Question: Can you elaborate on the construction costs for Chamonix given inflation? - Management confirmed that the project is fully pre-funded, with contingency plans in place to address potential cost overruns [41][42] Question: What are the expectations for sports betting and iGaming revenues? - Management indicated that while current revenues are guaranteed at $7 million, there is potential for higher earnings as market shares increase and new opportunities arise [46][49]