WYOMISSING, Pa.–(BUSINESS WIRE)–Nov. 4, 2021– Penn Nationwide Gaming, Inc. (NASDAQ: PENN) (“Penn Nationwide” or the “Firm”) at this time reported monetary outcomes for the three and 9 months ended September 30, 2021.
2021 Third Quarter Monetary Highlights:
Revenues of $1.5 billion, a rise of $382.1 million yr over yr and $157.3 million versus 2019;
Internet earnings of $86.1 million and web earnings margin of 5.7%, as in comparison with $141.2 million and 12.5%, respectively, within the prior yr and web earnings of $43.7 million and web margin of three.2% in 2019;
Adjusted EBITDA of $364.3 million, a rise of $20.7 million yr over yr and $52.7 million versus 2019;
Adjusted EBITDAR of $480.3 million, a rise of $27.7 million yr over yr and $72.4 million versus 2019; and
Adjusted EBITDAR margins of 31.8%, as in comparison with 40.1% within the prior yr and 30.1% in 2019.
For additional data, we have now posted a presentation to our web site concerning the third quarter highlights and accomplishments, which could be discovered right here.
Jay Snowden, President and Chief Government Officer, commented: “We achieved many important milestones within the third quarter. We efficiently launched the Barstool Sportsbook cell app in 5 states (Colorado, New Jersey, Tennessee, Virginia, and Arizona), which greater than doubled our footprint. As well as, we opened Hollywood On line casino York to robust preliminary outcomes, started to roll out our market main cashless, cardless, and contactless (“3Cs”) know-how throughout the portfolio and continued to derive a number of tangible advantages from our extremely differentiated omni-channel technique. We additionally continued to generate revenues and EBITDAR considerably above 2019 ranges, regardless of exogenous occasions that had a one-time impression on our quarter. Whereas July was a report month, the second half of August and September was impacted by Hurricane Ida and regional flare-ups of the Delta variant, which decreased property Adjusted EBITDAR and Adjusted EBITDAR margins by an estimated $30 million and 85 foundation factors, respectively. Because the working surroundings has normalized, we have now seen improved leads to October. Additional, Different Section outcomes included a $12.5 million lobbying expense to assist the California sports activities betting initiative and $7.5 million in bills associated to new state launches of our Barstool Sportsbook app.
“Along with the 5 new launches of our Barstool cell sportsbook betting app, all of which occurred earlier than the beginning of the soccer season, earlier this week, we launched our cell sports activities betting app in Iowa, which expands our footprint to 10 states. General, we’re benefiting from our elevated scale and are driving greater deal with and income market share throughout the board whereas remaining disciplined with our advertising and promotional spend. These outcomes underscore our dedication to our enterprise mannequin, which stays targeted on close to time period profitability relatively than aggressive advertising geared toward producing quick time period will increase in deal with.
“We achieved an necessary milestone with the closing of our acquisition of Rating Media and Gaming, Inc. (“theScore”) on October 19. Mixed with the facility of Barstool Sports activities, we are actually properly positioned to be North America’s main digital, leisure, sports activities content material, gaming, and know-how firm. Barstool’s vast, top-of-funnel viewers attain is very complementary to the information, scores and stats accessible on theScore’s finest at school media app, which can create a one-stop vacation spot for the sports activities fan that doesn’t exist at this time. Additional, we’re excited to deliver theScore’s cutting-edge know-how in home, which can present us with a completely built-in media and betting resolution in addition to full possession of our product roadmap.
“As the preferred sports activities media app in Canada, theScore is uniquely positioned to capitalize on the legalization of single occasion sports activities wagering in Ontario when the province is prepared for launch. According to our beforehand disclosed technique, we anticipate theScore Guess can be our main model in Canada whereas we’ll proceed to guide with Barstool Sportsbook within the U.S. Most significantly, we count on that each manufacturers will profit from the advertising assist of Barstool Sports activities and integration with theScore’s media app. We’re excited to welcome theScore’s quickly rising workforce into the Penn Nationwide Gaming household and are trying ahead to leveraging Canada’s world class expertise pool of engineering and know-how experience.
Core Enterprise Growth
“The outcomes from our core companies proceed to impress,” continued Mr. Snowden. “As acknowledged above, excluding the impression of Hurricane Ida and the Delta variant within the quarter, we noticed a continuation of the traits from prior quarters together with development in our VIP segments and our youthful demographics. Our VIP section grew by 33% in comparison with Q3 2019, fueled by will increase in each the variety of visitors taking part in at greater ranges and the frequency of their visitation. Moreover, we’re experiencing continued engagement with our youthful clients, who’re producing new development, and greater than offset any declines in Q3 of our older core gaming clients as a result of Delta variant. Importantly, October displays extra of what we noticed within the first half of the third quarter with robust property degree efficiency throughout our segments considerably offset by new competitors in Colorado and Indiana in addition to the residual impression of gaming enlargement in Pennsylvania. In the meantime, our retail Barstool Sportsbook ideas have stimulated database development and elevated frequency of visitation within the youthful segments, whereas boosting gaming and meals and beverage spend. Following the current passage of legalized sports activities betting in Louisiana, we opened retail sportsbooks at L’Auberge On line casino Baton Rouge and Boomtown New Orleans, and we’re trying ahead to increasing into our remaining Louisiana properties pending regulatory approval.
“New know-how can be driving demand. Downloads of our mychoice app, which reinforces the client expertise, will increase engagement, and improves advertising capabilities, elevated 22% within the quarter whereas utilization can be greater. Moreover, our 3Cs know-how offers a digitally built-in expertise by providing a touchless, partaking, environment friendly, and handy expertise for our visitors. This new know-how removes friction from transactions and reduces wait instances and contours. It additionally positions our properties for the long run by fulfilling the expectations of youthful shoppers who count on cashless choices at hospitality and leisure venues. The 3Cs are actually dwell at three properties in Pennsylvania and 4 in Ohio, and we plan to roll out the 3Cs to further properties all through this yr and into subsequent, pending regulatory approvals.
“On August twelfth, we celebrated the opening of Hollywood On line casino York, which is our third on line casino within the Commonwealth of Pennsylvania. This on line casino is constructed for the long run, with new applied sciences and buyer conveniences, together with the 3Cs and a Barstool Sportsbook. Whereas nonetheless early, we have now been inspired by the mixed efficiency of Hollywood York and Hollywood On line casino at Penn Nationwide Race Course. We’re assured in our skill to develop the general market as a result of positioning of our properties within the area, significantly with the anticipated opening of Hollywood On line casino Morgantown later this yr, pending regulatory approvals. We lately opened a profession middle and are accepting functions for roughly 375 new positions at Hollywood On line casino Morgantown, which can function roughly 750 slot machines and 30 desk video games, a Barstool Sportsbook and a number of meals and beverage shops.
Barstool Sportsbook Gaining Momentum Via Our Extremely Differentiated Technique
Mr. Snowden continued, “With the return of soccer season, we have now seen robust momentum with the Barstool Sportsbook within the states wherein we function, whereas sustaining our disciplined method to advertising. Our outcomes reinforce our confidence that the long-term winners within the house can be outlined by broad market entry, related sports activities manufacturers, natural buyer acquisition methods and best-in-class merchandise – all of which we’re uniquely positioned to ship.
“As evidenced by the September leads to our most mature states, Pennsylvania and Michigan, the Barstool Sportsbook has gained significant deal with market share via artistic advertising and unique choices, with out counting on heavy promotional spending or paid media. As well as, we’re starting to see very encouraging retention numbers from our preliminary cohort of shoppers, reflecting the robust loyalty and model affinity of the Barstool viewers. We consider these traits will result in sustainable income development as we proceed to leverage the structural benefits of our totally built-in media and omni-channel technique. The advantages of this technique had been lately on full show in Illinois, the place state rules presently require in-person registration for cell sports activities betting. In late-August, Dave Portnoy, Dan Katz and different Barstool personalities attended an on-premises occasion at Hollywood On line casino Aurora in reference to a particular promotion, main to almost 10,000 first-time depositors over a five-day interval, with minimal paid media.
“We’ve got additionally made important enhancements to our sports activities betting product, together with the introduction of Parlay+ (same-game parlay) and shareable wager slips. Almost 50% of our clients wager with Barstool exclusives and take part in merchandise promotions, odds boosts and alternatives to wager with or in opposition to in style Barstool expertise. Consequently, the Barstool Sportsbook is presently tied for the highest-rated sports activities betting app in North America within the Apple app retailer with a 4.8 consumer ranking out of 5.0. We consider we’ll make much more significant enhancements as we transfer to combine our sportsbook with theScore’s best-in-class sports activities media app and betting know-how which can present us with a extremely customizable and totally built-in know-how resolution. In the meantime, we’re persevering with to bolster our iCasino choices, together with the current launch of our Barstool-branded dwell seller studio in New Jersey. We now function iCasino throughout three states (Pennsylvania, Michigan, and New Jersey) and are positioned to realize further market share with the launch final week of our first in-house developed, Barstool-branded digital iCasino recreation in New Jersey, ’Barstool Blackjack.’
“In the meantime, Barstool Sports activities has continued its speedy ascent into one of many premier leisure and way of life manufacturers for Millennials and Technology Z. With a extremely diversified income mixture of promoting, model licenses and commerce, Barstool is on monitor to as soon as once more meaningfully develop revenues yr over yr. Equally necessary, Barstool continues to aggressively pursue alternatives to unlock new channels for future development. For instance, Barstool lately introduced its intent to assist collegiate athletes in pursuing NIL (title, picture, and likeness) sponsorship preparations. In only a few months, Barstool has signed 135,000 collegiate athletes to function Barstool Athletes, demonstrating the unimaginable energy of the model throughout the youthful demographic. As well as, One Chunk frozen pizza was lately launched solely at Walmart shops throughout the nation, with preliminary gross sales exceeding expectations. Lastly, we anticipate launching the primary two stand-alone Barstool-branded sports activities bars within the coming months in Philadelphia and Chicago, which can characterize an extension of our omni-channel technique to extra focused, versatile, and extremely valued places.
Persevering with to Look after our Individuals, our Communities, and the Planet
“On August 29, Hurricane Ida hit Louisiana as one of the devastating storms to strike america. The response from our workforce members throughout the nation within the aftermath as soon as once more demonstrated the compassion and dedication our Penn household has for each other and the communities we serve. With restricted provides accessible in New Orleans, and fundamental utilities utterly disabled, our sister properties helped to offer short-term housing and far wanted provisions. As well as, our Penn Nationwide Gaming Basis established the ‘Hurricane Ida Emergency Reduction Fund’ for workforce members to use for monetary help for quick wants.
“Moreover, with feminine members comprising 44% of our Company Board of Administrators, we’re proud to be each an honoree on the Girls’s Discussion board of New York’s Annual Breakfast of Champions for ‘Main the Approach to Gender Stability on Company Boards’ in addition to a ‘Champion of Board Variety’ by The Discussion board of Government Girls, the Higher Philadelphia Area’s premier ladies’s group, which yearly honors the highest public firms within the Philadelphia area with 30% or extra ladies on their respective boards.
“Additional we proceed our robust assist for our nation’s heroes, via new partnerships with the Concussion Legacy Basis, which launched a particular challenge targeted on CTE & PTSD analysis on veterans. We’re additionally providing monetary assist to the ‘No One Left Behind,’ group, which offers funds to assist Afghan particular immigration visa recipients (SIVs) with meals, housing, clothes and a no-interest mortgage program which helps immigrant households grow to be self-sufficient.
“Lastly, we’re persevering with our sustainability efforts. We’re lowering carbon emissions by including electrical automobile (EV) charging stations at our properties. We’ve got put in EV charging stations at 24% of our properties, with an extra 32% on schedule for roll-out over the following 12 months. We stay targeted on lowering plastic waste as 75% of our resort properties are actually using bulk amenity dispensers for shampoo, conditioner, and physique wash. We additionally prioritize sustainable meals manufacturing and provide chains via truthful commerce, hormone-free and reduced-antibiotic F&B procurement.”
Sturdy Stability Sheet and Liquidity
On July 1, 2021, we closed on our personal providing of $400 million combination principal quantity of 4.125% senior notes due 2029. Conventional web debt as of September 30, 2021 was $45 million, a lower of $71 million in the course of the quarter, principally resulting from repayments beneath our senior secured credit score amenities. Our lease-adjusted web leverage was 3.9x based mostly on Adjusted EBITDAR via the trailing 12 months ended September 30, 2021. Our steadiness sheet money as of September 30, 2021 was $2.7 billion and our whole liquidity inclusive of our undrawn revolver was $3.4 billion, offering us with ample capability to pursue further development initiatives. Subsequent to quarter finish, on October 19, we accomplished the acquisition of Rating Media and Gaming Inc. for whole consideration of roughly $1.9 billion, of which roughly $923 million was paid in money.
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