Pinnacle Entertainment reports record revenue in 2012
13 February 2013
Las Vegas-based Pinnacle Entertainment reported record revenue in 2012 and will continue plans to close on its deal to acquire Ameristar Casinos this year, a move that would give the company its first Nevada properties.
Pinnacle, which operates casinos and racinos in Louisiana, Ohio, Indiana, Missouri and Texas, reported a net loss of $42.2 million, 72 cents a share, on revenue of $301.6 million for the fourth quarter that ended Dec. 31.
That compares with earnings of $25 million, 40 cents a share, on revenue of $275.8 million for the same quarter a year earlier.
For 2012, the company had a net loss of $31.8 million, 52 cents a share, and revenue of $1.2 billion, a 4.9 percent increase over the previous year.
Analysts attributed the loss to the underperformance of its Louisiana properties and a write-down in the financing of an investment in the company’s luxury hotel property partnership with MGM Resorts International on the Ho Tram Strip in Vietnam.
Pinnacle attributed most of its gains to record revenue performances at its L’Auberge Lake Charles, La., and St. Louis properties.
The deal to acquire Ameristar for $869 million, first announced in December, would give Pinnacle properties in Mississippi, Iowa, Colorado and Nevada. Ameristar operates the Cactus Pete’s and Horseshu properties in Jackpot, near the Idaho border.
Other highlights from today’s earnings report:
• Executives say their early due diligence of the deal with Ameristar indicate it “will be a very good fit” and “a transformational event for our company.”
• The company is starting to see customer loyalty trends in its Louisiana market, particularly after the opening of its L’Auberge Baton Rouge property in September 2012.
• The company signed an agreement to dispose of its land holdings in Atlantic City for $30.6 million, subject to a financing contingency. The transaction is expected to close by the end of the first quarter.
• The company opened a new parking garage at its River City property in St. Louis in November, reducing visitation problems that occurred through most of 2012 and peaked in the third and fourth quarters. Construction of a hotel and event center in phases through 2013 is expected to continued to disrupt the property.
Executive quote: “The strong operating results we delivered in 2012 came in spite of abnormally low table hold across our Louisiana properties and a general softening in business volumes our industry began to experience during the fourth quarter,” said Anthony San Filippo, president and CEO of Pinnacle.
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