Casino operator Caesars Entertainment Corp. provided on Monday information about its financial performance during the three months ended September 30, 2016. Quarterly results did not include proceeds from Caesars Entertainment Operating Company, Inc. (CEOC) and the latter’s subsidiaries.
Back in January 2015, CEOC and several of its US subsidiaries filed for reorganization under Chapter 11. In October 2016, all of the company’s creditor groups noted their support for the restructuring plan presented to them. They penned an agreement that paved the way for CEOC’s reorganization. If the process goes as planned, the operator is expected to conclude its bankruptcy case in 2017.
Caesars’ net revenue amounted to $986 million during this year’s third quarter, reflecting a 3% increase from the same period of 2015. The rise was mainly attributed to a strong growth in the company’s Las Vegas operations but was slightly offset by drops in Atlantic City and New Orleans revenues and unfavorable year-on-year hold. Casino revenue amounted to $542 million for the period in review.
The gambling operator generated loss of $44 million, compared to income of $84 million posted for the same three months of 2015. The significant drop was due to a rise in Caesars Interactive Entertainment stock-based compensation awards granted as a result from the sale of the iGaming division’s SMG Business. The transaction took place in August.
Net income amounted to $5 million for the reported period, up from net loss of $756 million posted for the third quarter of 2015. The increase was attributed to a pre-tax gain of $4.2 billion on the SMG Business’ sale and was partially offset by a $3 billion accrual, which was related to Caesars’ estimate of the amount it would spend on supporting CEOC’s reorganization.
The gambling operator posted property EBITDA of $287 million for the reviewed period, up 9.5% year-on-year. Adjusted EBITDA was up 9.3% year-on-year to $269 million. The growth was attributed to increased revenue and efficiency initiatives.
Commenting on the latest financial results reported, Caesars CEO and President Mark Frissora said that his company delivered yet another solid quarter. In addition, it managed to expand margins, which was indicative of the operator’s progress towards managing costs in an effective manner while providing customers with enhanced service.
Mr. Frissora noted that they will remain focused on delivering revenue growth and productivity gains in a bid to increase margins and cash flow.
