Full House Resorts, a casino operator in posted a net loss for 2022 due to a decline in revenue and construction impact.
Full House saw year-on-year growth both in Nevada and its contracted sports betting section, but its revenue declined in Mississippi, its core market as well as in Colorado, Indiana, and Colorado.
Operator said that the main reason for the year-on-year drop was because players in 2021 were issued government stimulus checks to help the economy recover from the pandemic. These were not issued in 2022 as the economy had sufficiently recovered to allow the government withdraw the stimulus checks.
Full House also noted that the Chamonix Casino Hotel is expected to open in the third quarter this year, after the Bronco Billy’s Casino in Colorado was closed.
In November 2021, approximately 41% of the pre-existing gaming area was closed to allow construction. Additional gaming capacity was also closed in May 2022 to make way for refurbishment. Although the casino’s refurbished section was reopened in December, it still has approximately half of its pre-pandemic gaming capacity.
Full House also stated that its operations in Mississippi were affected by legal online betting in Louisiana.
Fourth quarter
The revenue for the three months ended December 31st was $36.1m. This is 16.4% less than the $43.3m earned the previous year.
All markets saw a decline in revenue, with Mississippi’s revenue dropping 18.2% to $18.4m, Indiana falling 7.2% to $9.0m, Colorado down 30.0% at $3.5m, Nevada shrinking 4.7% to $4.1m, and contracted sports betting down 38.9% to $0.1m.
Revenue fell across all segments. Casino saw the biggest drop, as it lost 18.0% to $25.6m in revenue.
Operating expenses rose 4.2% to $39.3m. After adding $3.8m in finance-related charges, this resulted in a pretax loss of $7.0m. This compares to a profit of $5.1m at the same time in 2021.
Full House paid $15,000 in income taxes, but the quarter ended with a $7.0m net loss. This is in contrast to the $5.0m profit in the previous year. Additionally, the adjusted EBITDA decreased 50.6% to $3.9m.
Full-year
The results for the entire year were similar, with revenue dropping 9.4% from $180.2m – $163.3m. With the exception of contracted sports betting, revenue was down across all segments.
Mississippi’s revenue fell 10.7% to $80.9m. Indiana revenue dropped 4.6% to $39.1m. Colorado revenue declined 31.7%, to $16.2m.
Nevada’s revenue rose 8.1% to $20.0m due to tourism to Lake Tahoe. Meanwhile, revenue from contracted sports betting increased 22.0%, to $7.2m, thanks to the launch of a new skin in the latter part of 2021.
Costs were up 5.6% to $150.6m. When accounting for $27.5m financial costs, this leaves a $14.8m pre-tax loss, compared to the $12.1m profit made in 2021.
Full House paid $31,000 income tax. This resulted in a net loss $14.8m compared to the $11.7m profit made at the end 2021. The adjusted EBTIDA, at $32.1m, was also lower by 32.0%.
The Temporary By American Place
Full House provided an update on the new temporary casino in Illinois. The Temporary by American Place opened its doors on February 17th and welcomed more than 4000 guests in its first 12 days.
Full House President and Chief Executive Daniel Lee stated that, as is typical of many new casinos in the area, they opened at a lower capacity. “On our opening night, we had only 80% of our slots floor and 60% of our allowed table games.
“Over the next weeks, we expect further increase the number of games on our floor as well as increasing the hours of operation for table games. Currently, they are open from 2pm to 2am. We expect the casino to be open 24 hours a day as our team gains experience. This is in addition to our current schedule which runs from 8am to 4am.
“Given The Temporary’s early response, we are confident that we can generate attractive returns from both The Temporary as well as our future American Place destination.”
