Colorado Springs-based Century Casinos reported first quarter results Friday morning, generating earnings in-line with expectations while fortifying its presence in the province of Alberta with the approval of horse racetrack project south of Edmonton.
The company produced net operating revenue of $36.4 million and earnings from operations of $4.5 million – both figures were up 10 percent year-over-year.
Adjusted EBITDA grew 6 percent to $6.7 million, while net earnings fell to $2.2 million – a 5 percent drop from the prior year quarter. Earnings per share were stable at $0.09.
“Overall, we are quite pleased with the results of the first quarter, taking into account a pretty unfavorable New Year’s holiday calendar as well as severe inclement weather in Colorado compared to last year,” said Erwin Haitzmann and Peter Hoetzinger, co-chief executive officers of Century Casinos.
The big news for the quarter was the Alberta Gaming and Liquor Commission’s approval of the Century Mile horse racetrack just south of Edmonton on land owned by the city’s international airport. The facility will include a one-mile racetrack, a gaming floor fitted with at least 550 slot machines, dining venues and entertainment outlets.
The project earned approval in March and is expected to be completed in late 2018 or early 2019 at a cost of $40 million.
“We are very excited about having received regulatory approvals for our racetrack and casino project in Edmonton, Canada,” Haitzmann and Hoetzinger said, adding that south Edmonton remains an underserved market with substantial upside.
The Century Mile project will take the place of Northlands Park – a longtime competitor to Century Casino Edmonton. Hoetzinger called the opportunity to develop a new property while removing a competitor from the market a “double jackpot.”
The strongest growth for the quarter came from the company’s Poland operations, which generated $14.5 million in net revenues – up 19 percent year-over-year. In April, Century announced that it had received approval to move its second license in the country to the Hilton Hotel in Warsaw.
The new facility will showcase a 17,000 square feet gaming floor with 24 tables and 70 slot machines. Notably, Century Poland’s main competitor was situated there until its license expired in late 2016.
Canada remained the strongest segment by producing $13.1 million revenues – up 1 percent, though EBITDA fell from $3.5 million to $3 million. The EBITDA drop was attributed to lower table game hold and a tough comparison from the prior year period.
The company’s Alberta properties comprise 38 percent of its total revenue and upwards of half of its EBITDA.
The company’s properties in Colorado also performed well, increasing revenues by 6 percent and EBITDA by 23 percent. Century also announced that it has postponed a planned renovation of its Palace Hotel in Cripple Creek, Colorado.
On its balance sheet, Century had $40 million in cash and cash equivalents against $55 million in outstanding debt – a roughly 2.1 times debt to adjusted EBITDA ratio.
