Bally’s Corporationhas reported a strong recovery in its North American Interactive Division in Q1 2023 after a series cost-cutting measure following a disastrous year of 2022.
Robeson Robeves , CEO, explained that the unit “significantly exceeded” the initial forecasts. The unit’s online unit suffered unsustainable losses in the past year.
Bally’s Q4 and 2020 results were released earlier this year. The North American Interactive division recorded losses of $428m.
The North American online unit reported revenues of $24.4m for Q1 2023. This is an increase of 60.5% over the previous year. The firm continues to concentrate on its online casino business.
The unit’s adjusted EBITDA was negative $10.6m, a significant reduction from the $19.3m lost in Q1 of 2022. The adjusted EBITDA of the unit was negative $10.6m. This is a substantial reduction compared to the $19.3m loss in Q1 2022.
Reeves explained that this was because of its cost-cutting and increased focus on its online gambling operations, especially in New Jersey, where it hopes to capture an 8% share of the market.
He said: “North America Interactive outperformed, as cost-saving initiatives were implemented faster than expected. We are still igaming-first and are performing extremely well in New Jersey, where our market shares have exceeded 4%. This is well on our path to reaching our longer-term goal of 6-8%.
“As Ontario progresses, we are looking forward to the launch of our Pennsylvania site in May.” We also monitor the Rhode Island igaming legislation that was introduced recently. Our igaming company is making a profit and we’re very optimistic about its future.
While the online casino is recovering, the Bally Bet brand continues to be relaunched. This includes the recently announced partnership between White Hat and Kambi for sportsbook technology.
According to the CEO of the company, these agreements will help bring the business of sports betting “back up and operating in a more effective and efficient way.”
Other Q1 Numbers
Bally’s, aside from its online division, reported a solid start to 2023. Revenues reached $598.7m (up 9.2% YoY), thanks to a 17.5% increase in land-based revenues, which reached a record quarterly revenue of $328.8m.
Casinos and Resorts also generated adjusted EBITDA (equivalent to $78.8m) which was relatively stable compared to the previous year. However, record revenues showed that casino footfall, engagement and revenue remain strong.
The total adjusted EBITDA of the group for Q1 increased by 10.2% to $126.4m. This shows the positive impact the Interactive unit has had on the numbers. Net income also increased exponentially to $178.3m from $1.9m by 2022.
George Papanier Bally’s president, gave investors an update about the Casino and Resorts division. He explained: “Our Casinos & Resorts portfolio’s short-term capex has peaked as several of our expansion projects are either nearing or have already been completed. The upgrade of Bally’s Twin River, our flagship casino in Rhode Island was completed in April. Our Kansas City expansion will be finished in July.
We look forward to the Chicago temporary casino opening in the late summer of 2023. It is on schedule and within budget. Bally’s Chicago is also on track to open its permanent facility in summer 2026, a little ahead of schedule. We are excited to start delivering results. There is a lot of consumer demand for this facility.
Profit guidance for 2023 raised following strong results
Bally’s, following a strong performance in Q1, has increased its adjusted EBITDA guidance for the full year to investors. It is now expected to be between $665m and $700m. According to calculations, this equates to $40-50m in losses for North America Interactive. This is a 10-fold reduction.
Bally’s projected revenue for this year is $2.5-$2.6bn.
More senior leadership changes
Bally’s senior leadership changed after the release of the results for 2022. Former CEO Lee Fenton left and Reeves & Papanier took on new roles within the company.
Bobby Lavan has left the company to pursue a new opportunity. Marcus Glover replaces Lavan as Chief Financial Officer. He has over 20 years’ experience in the gaming and hospitality industries.
Glover has held several positions in the gaming industry, including President and Chief Operation Officer at the Borgata Casino, Hotel & Spa and President and chief operating officer of the Beau Rivage Resort & Casino.
Soo Kim is the Chairman of Bally’s. He said: “On behalf of our Board of Directors, we are excited to welcome Marcus at Bally’s. Marcus is an accomplished leader who has a track record in driving transformational strategies. He also has demonstrated expertise leading large integrated resorts, casino gaming operations and other large businesses.
I am confident that Bally’s will grow and reach its financial goals with his strong financial background and experience.
