43
Penn National third-quarter revenues exceed expectations
By ROBERT CONNELLY
WYOMISSING, Pa.
Penn National Gaming Inc. said its revenues were $645.9 million for the third quarter, beating projections of $633.5 million.
The numbers reflect company activity between July 24 and Sept. 30.
Penn National officials hosted a conference call Thursday morning to talk about the latest figures.
Jay Snowden, chief operating officer of Penn National, said Hollywood Gaming at Mahoning Valley Race Course in Austintown Township “has shown a strength beyond our forecast.” He also said, “Mahoning Valley has been a really impressive story as we close out September ... [and] looks good again as we follow up on a strong opening.”
While officials have been happy with the opening and performance so far, they were quick to taper those thoughts with the fact that the facility has been open only a handful of weeks. Officials also said Hollywood Gaming’s performance so far has not changed the forecast of the market here.
Timothy J. Wilmott, president and chief executive of Penn National Gaming, made statements early Thursday in a news release on the quarterly numbers.
He highlighted the opening of Hollywood Gaming at Mahoning Valley Race Course on Sept. 17, Hollywood Gaming at Dayton Raceway on Aug. 28, and Zia Park Casino in Hobbs, N.M., also on Aug. 28.
“Consistent with the company’s long-term record, all three projects opened on time and on budget,” Wilmott said.
While officials applauded Mahoning Valley, they fielded several questions on Dayton during a conference call. When asked specifically if Dayton is being cannibalized by the competition from Columbus, where Penn National owns the Scioto Downs Racino, Snowden countered that point.
He said Scioto received customers from Dayton before Miami Valley Gaming in Lebanon opened and started to take those players.
Officials also noted in the third quarter that Dayton took a 10 percent hit on the reported revenue figures for the third quarter on a free play promotion that went wrong. Instead of some customers’ getting free play during the promotional period, all players on the floor received free play.
The report also indicated a planned total budget of $161 million, of which $51 million had been spent through Sept. 30 for Hollywood Gaming at Mahoning Valley Race Course.
That number includes payments on the $50 million license fee and a $75 million relocation fee. The report said Penn National paid $7.5 million of the relocation fee upon opening and will make 18 semiannual payments of $4.8 million one year after opening to pay off that debt.
Similarly, Penn National paid $10 million of the license fee in this year’s second quarter and $15 million when Hollywood Gaming opened. The remaining $25 million will be paid on the one-year anniversary of the facility, Penn National said.
As for what is in store next year, Snowden said, “We would all hope that the weather impact would be less severe than 2014.”