Century Gaming, an enterprise managing casinos across the United States and Canada, recently published its financial performance for the third quarter of 2023, revealing noteworthy patterns. Although their net operating income surged by a substantial 43% compared to the corresponding period last year, both their operating earnings and net income experienced a decline.
What could be the explanation? Century Gaming points to a series of property purchases and divestments completed during the third quarter. Notably, they concluded a major transaction on September 6th, offloading their Canadian portfolio comprising four casinos to a subsidiary of Vici Properties for CAD$2.217 billion (equivalent to approximately US$1.626 billion at the time).
This strategic realignment of assets is likely the primary factor behind the seemingly paradoxical financial outcomes. While their total revenue has grown, partly due to new acquisitions, the company is simultaneously addressing the intricacies of integrating these newly acquired properties and handling the financial ramifications of the Canadian sale.
To illustrate, while their US operations witnessed a 21% rise in operating earnings, their Canadian and Polish operations experienced substantial decreases. This is not entirely unexpected considering the Canadian divestiture.
Despite the reduction in net income, Century Gaming announced a 19% increase in adjusted EBITDA, reaching $3.33 million. This implies that the company’s fundamental operations remain robust, and they maintain a positive outlook on the long-term profitability of their strategic decisions.
Century Casinos’ co-chief executives, Erwin Haitzmann and Peter Hoetzinger, declared unprecedented net operating income and Adjusted EBITDA subsequent to the prosperous incorporation of the Nugget Casino Resort and Rocky Gap Casino Resort and Golf Course.
They did concede that the substantial non-recurring expenses linked to assimilating Rocky Gap and a sale-leaseback agreement in Canada affected operational earnings and net deficit for the period.
Moving forward, the firm anticipates income and operational expenditure patterns to persist in line with preceding quarters.
It’s notable that the purchase of Rocky Gap Casino Resort in Maryland for $59.1 million represented a considerable outlay for Century Casinos, further cementing their footprint in the area.
admin