Racetrack and casino owner Penn National Gaming Inc. reported first quarter results that exceeded guidance April 26, noting it enjoyed record income from operations for the first three months of the year of $172.1 million.
"We are pleased to report that Penn National delivered a strong first quarter that exceeded our guidance," said PNGI chief executive officer Timothy J. Wilmott. "We are achieving significant benefits from our ongoing margin enhancement initiatives, which helped all three operating segments generate year over year adjusted EBITDA growth. In addition, more than half of our properties achieved year-over-year EBITDA growth and 65% of our gaming operations delivered adjusted EBITDA margin increases despite having to navigate difficult weather impacts during the quarter."
The company reported these first quarter highlights (comparisons are to last year's first quarter):
* Net revenues of $816.1 million; a 5.1% increase,
* Income from operations of $172.1 million, up 22.7%, and
* Adjusted EBITDA of $242.6 million, up 6.6%.
Wilmott said the Pinnacle acquisition is going as planned.
"On March 29, shareholders of both Penn National and Pinnacle Entertainment overwhelmingly approved our proposed merger, with over 99% of all votes cast in favor of the transaction. Additionally, we have secured regulatory approvals, subject to customary conditions, from Pennsylvania (both the gaming control board and the racing commission), West Virginia and Illinois. This week and over the coming months we'll be appearing before additional regulatory bodies to seek their approvals," Wilmott said. "Based on our progress to date, we remain confident of closing the transaction in the second half of this year. In the meantime, having visited all of the Pinnacle properties, as well as their Las Vegas Service Center on multiple occasions, we remain very impressed by their talented property and corporate teams and continue to make meaningful progress with our integration planning. As we've learned more about Pinnacle's operations and processes, we are confident our $100 million of cost synergy objectives are well within reach."
As previously reported, following the closing of the proposed transaction, Penn National will enjoy significantly greater operational scale and geographic diversity from a combined 41 properties in 20 jurisdictions, including 15 of the top 30 Metropolitan Statistical Areas in America.