Pinnacle Entertainment Inc. closed out 2017 by reversing a fourth quarter net loss from a year ago as the company prepares to become part of Penn National Gaming.
The regional gaming giant, which owns 16 casinos in nine states and a racetrack in Texas, said Friday its focus in 2018 is to hand over a profitable and efficient operation once the deal with Penn National closes.
The two companies agreed to a $2.8 billion sale to Penn that is expected to close by June.
“We will make every effort to maximize the financial performance of our gaming entertainment businesses and to repay debt on our balance sheet, with the goal of having our company on its best financial footing at the time of the closing of the transaction with Penn National,” Pinnacle CEO Anthony Sanfilippo said in a statement.
Las Vegas-based Pinnacle said its net income for the quarter that closed on Dec. 31 was $22.4 million, reversing a $9 million net loss from the 2016 fourth quarter. The profits translated into 36 cents per share. Revenues for the quarter declined 2.6 percent to $620.8 million.
For all 2017, Pinnacle revenues grew 7.7 percent to $2.6 billion.
Sanfilippo credited the results on a full year of operations from the Meadows Racetrack and Casino near Pittsburgh, which Pinnacle acquired in 2016.
He said the company’s flagship L’Auberge Lake Charles in Western Louisiana – “the perennial thoroughbred of our portfolio – grew cash flow despite business interruptions in the third quarter due to Hurricane Harvey, which caused severe flooding in Houston and southeast Texas, the casino’s primary feeder market.
“Our focus in 2018 remains on operations and our initiatives to drive profitable revenue streams and expense efficiency,” Sanfilippo said. “We continue to pursue prudent capital investments to maintain the high-quality businesses in our portfolio and expand the amenities we provide our guests.”
Because of the pending sale to Penn National Gaming, Pinnacle did not host a conference call following the earnings release.
After the deal, Penn National will operate a combined 41 properties with about 53,500 slots, 1,300 tables and 8,300 hotel rooms in the United States.
To avoid regulatory and federal anti-trust issues around the deal, Pinnacle is selling four of its Ameristar properties – Ameristar Kansas City, Ameristar St. Charles in Missouri, Belterra Casino Resort in Indiana, and Belterra Park in Ohio – to Boyd Gaming Corp. for $575 million. At the same time, Boyd will sign a lease agreement with Gaming and Leisure Properties Inc., the landlord for Penn National and Pinnacle.
