Penn National Soaring on Slot and Casino Income

Penn National's revenue for the fourth quarter and the year soared due to slot machines and two Mississippi casinos acquired last year.

Revenue for the quarter ending Dec. 31 skyrocketed just shy of 101% to $91.86 million compared with the same period of 1999 when revenue was $45.7 million. For the year, Penn National (Nasdaq:PENN) reported a 71.5% increase in revenue to $294.1 million, up from $171.5 million in 1999.

Growth at Charles Town Races has been phenomenal since the West Virginia track began operating slots machines. Fourth quarter earnings before taxes, depreciation, and interest (EBITDA) rose 137% to $9 million at Charles Town compared with an EBITDA of $3.8 million during the same quarter of 1999. Charles Town increased its revenue for the quarter 63% to $35.1 million because of additional coin-out slot machines.

The only soft spot in the company's quarterly figures was Penn National Race Course and its off-track wagering network, which reported a 10.6% loss in revenue and a 35.5% loss in EBITDA for the quarter.

Earnings for the fourth quarter doubled to 18 cents per share, while earnings for the year rose 77% to 78 cents per share compared with 44 cents per share in 1999.

"During the year, Penn National was transformed from a pari-mutuel operator to a diversified gaming, entertainment, and pari-mutuel company," said Peter Carlino, Penn National's chief executive officer. "Over the years we have generated solid returns on capital invested in our Pennsylvania and West Virginia properties and we plan to expand and renovate Casino Magic with a new hotel and other amenities."

The Casino Magic hotel, casino, golf resort, and marina is one Penn National's two Mississippi casinos. The other is the Boomtown Biloxi casino. The company also intends to acquire CRC Holdings, which owns the management contract for a Canadian Indian casino, and a minority interest in Louisiana Casino Cruises, which owns and operates a riverboat casino in Baton Rouge.