05.11.2021 11:00:00

Century Casinos, Inc. Announces Third Quarter 2021 Results

COLORADO SPRINGS, Colo., Nov. 5, 2021 /PRNewswire/ -- Century Casinos, Inc. (Nasdaq Capital Market®: CNTY) today announced its financial results for the three and nine months ended September 30, 2021.

Century Casinos Logo (PRNewsfoto/Century Casinos, Inc.)

Third Quarter 2021 Highlights*

  • Net operating revenue was $116.6 million, an increase of 22% from the three months ended September 30, 2020.
  • Earnings from operations was $25.7 million, an increase of 71% from the three months ended September 30, 2020.
  • Net earnings attributable to Century Casinos, Inc. shareholders was $11.2 million, an increase of 200% from the three months ended September 30, 2020.
  • Adjusted EBITDA** was $33.1 million, an increase of 49% from the three months ended September 30, 2020.
  • Basic and diluted earnings per share were $0.38 and $0.36, respectively.
  • Book value per share*** at September 30, 2021 was $4.59.

COVID-19 UPDATE
The COVID-19 pandemic had an adverse effect on the Company's 2020 results of operations and financial condition, and has impacted the Company's results of operations to a lesser extent in 2021 because the Company's United States properties were open and operating during this period.

The Company's Canada properties reopened on June 10, 2021, and its Poland casinos reopened on May 28, 2021. The Company's casinos in the United States have been open since June 2020. The Company's properties have varied their operations based on the governmental health and safety requirements in the jurisdictions in which they are located. Current governmental health and safety requirements in Canada include proof of vaccination or negative rapid test results for entry. The Company's operations in the United States and Poland have limited health and safety requirements. The duration and ultimate impact of the COVID-19 pandemic otherwise remains uncertain.

The consolidated results for the three and nine months ended September 30, 2021 and 2020 are as follows:

Amounts in thousands, except per share data

For the three months 
ende
d September 30,



For the nine months

 ended September 30,

Consolidated Results:



2021



2020


% Change



2021



2020


% Change

Net Operating Revenue


$

116,610


$

95,706


22%


$

281,207


$

219,466


28%

Earnings (Loss) from Operations



25,727



15,014


71%



52,089



(18,872)


376%

Net Earnings (Loss) Attributable to Century Casinos, Inc. Shareholders


$

11,226


$

3,748


200%


$

16,662


$

(54,715)


131%


















Adjusted EBITDA**


$

33,056


$

22,214


49%


$

73,040


$

30,036


143%


















Earnings (Loss) Per Share Attributable to Century Casinos, Inc. Shareholders:

Basic


$

0.38


$

0.13


192%


$

0.56


$

(1.85)


130%

Diluted


$

0.36


$

0.13


177%


$

0.54


$

(1.85)


129%


















The Company plans to relocate its Century Casino Caruthersville casino, currently the last remaining riverboat on open water in Missouri, to a land-based casino with an attached hotel, estimated to open in early 2024, and to build a hotel that will attach onto Century Casino Cape Girardeau, estimated to open in late 2023. The Company estimates project costs of $68.3 million. The Company plans to finance the cost of these projects with cash on hand, financing, or a combination of the two.

"In the third quarter we achieved outstanding results. We achieved our highest quarterly net operating revenue and Adjusted EBITDA** in the Company's history and a consolidated Adjusted EBITDA margin** of 28.3%. We continue to have a strong balance sheet, with cash over $100 million and no substantial debt maturities before 2026," Erwin Haitzmann and Peter Hoetzinger, Co-Chief Executive Officers of Century Casinos remarked. "We are exploring exciting growth opportunities at our two Missouri properties with plans to build a hotel at each property and a land-based casino in Caruthersville," Messrs. Haitzmann and Hoetzinger concluded.

REPORTABLE SEGMENT RESULTS*
The table below shows the Company's reporting units and operating segments that are included in each of the Company's reportable segments as of September 30, 2021:




Reportable Segment

Operating Segment

Reporting Unit

United States

Colorado

Century Casino & Hotel - Central City



Century Casino & Hotel - Cripple Creek


West Virginia

Mountaineer Casino, Racetrack & Resort


Missouri

Century Casino Cape Girardeau



Century Casino Caruthersville

Canada

Edmonton

Century Casino & Hotel - Edmonton



Century Casino St. Albert



Century Mile Racetrack and Casino


Calgary

Century Downs Racetrack and Casino



Century Sports



Century Bets! Inc.

Poland

Poland

Casinos Poland

Corporate and Other

Corporate and Other

Cruise Ships & Other



Corporate Other

The Company's net operating revenue increased by $20.9 million, or 22%, and by $61.7 million, or 28%, for the three and nine months ended September 30, 2021, compared to the three and nine months ended September 30, 2020. Following is a summary of the changes in net operating revenue by reportable segment for the three and nine months ended September 30, 2021, compared to the three and nine months ended September 30, 2020:


























Net Operating Revenue



For the three months







For the nine months








ended September 30,



$


%


ended September 30,



$


%

Amounts in thousands


2021


2020



Change


Change


2021


2020



Change


Change

United States


$

73,897


$

62,647


$

11,250


18%


$

214,969


$

139,908


$

75,061


54%

Canada



21,368



16,577



4,791


29%



30,031



37,479



(7,448)


(20%)

Poland



21,151



16,339



4,812


30%



35,751



40,793



(5,042)


(12%)

Corporate and Other



194



143



51


36%



456



1,286



(830)


(65%)

Consolidated


$

116,610


$

95,706


$

20,904


22%


$

281,207


$

219,466


$

61,741


28%
























The Company's earnings from operations increased by $10.7 million, or 71%, and by $71.0 million, or 376%, for the three and nine months ended September 30, 2021, compared to the three and nine months ended September 30, 2020. Following is a summary of the changes in earnings (loss) from operations by reportable segment for the three and nine months ended September 30, 2021, compared to the three and nine months ended September 30, 2020:




 

Earnings (Loss) from Operations



For the three months ended September 30,



$



%


For the nine months

ended September 30,



$


%

Amounts in thousands



2021



2020



Change


Change



2021



2020



Change


Change

United States


$

19,510


$

14,707


$

4,803


33%


$

60,569


$

(13,690)


$

74,259


542%

Canada



6,793



3,069



3,724


121%



2,354



153



2,201


1439%

Poland



2,642



202



2,440


1208%



(2,526)



(1,708)



(818)


(48%)

Corporate and Other



(3,218)



(2,964)



(254)


(9%)



(8,308)



(3,627)



(4,681)


(129%)

Consolidated


$

25,727


$

15,014


$

10,713


71%


$

52,089


$

(18,872)


$

70,961


376%

























Net earnings (loss) attributable to Century Casinos, Inc. shareholders increased by $7.5 million, or 200%, and by $71.4 million, or 131%, for the three and nine months ended September 30, 2021, compared to the three and nine months ended September 30, 2020. Following is a summary of the changes in net earnings (loss) attributable to Century Casinos, Inc. shareholders by reportable segment for the three and nine months ended September 30, 2021, compared to the three and nine months ended September 30, 2020:


























Net Earnings (Loss) Attributable to Century Casinos, Inc. Shareholders



For the three months







For the nine months








ended September 30,



$


%


ended September 30,



$


%

Amounts in thousands


2021


2020



Change


Change


2021


2020



Change


Change

United States


$

12,389


$

7,656


$

4,733


62%


$

39,486


$

(35,999)


$

75,485


210%

Canada



5,308



1,880



3,428


182%



265



(4,102)



4,367


107%

Poland



1,437



86



1,351


1571%



(1,432)



(1,134)



(298)


(26%)

Corporate and Other



(7,908)



(5,874)



(2,034)


(35%)



(21,657)



(13,480)



(8,177)


(61%)

Consolidated


$

11,226


$

3,748


$

7,478


200%


$

16,662


$

(54,715)


$

71,377


131%
























Items deducted from or added to earnings from operations to arrive at net earnings (loss) attributable to Century Casinos, Inc. shareholders include interest income, interest expense, gains (losses) on foreign currency transactions and other, income tax expense and non-controlling interests.

Adjusted EBITDA** increased by $10.8 million, or 49%, and by $43.0 million, or 143%, for the three and nine months ended September 30, 2021 compared to the three and nine months ended September 30, 2020. Following is a summary of the changes in Adjusted EBITDA** by reportable segment for the three and nine months ended September 30, 2021 compared to the three and nine months ended September 30, 2020:


























Adjusted EBITDA**



For the three months







For the nine months








ended September 30,



$


%


ended September 30,



$


%

Amounts in thousands


2021


2020



Change


Change


2021


2020



Change


Change

United States


$

24,209


$

19,222


$

4,987


26%


$

74,585


$

30,073


$

44,512


148%

Canada



7,966



4,425



3,541


80%



6,112



7,451



(1,339)


(18%)

Poland



3,005



981



2,024


206%



(603)



575



(1,178)


(205%)

Corporate and Other



(2,124)



(2,414)



290


12%



(7,054)



(8,063)



1,009


13%

Consolidated


$

33,056


$

22,214


$

10,842


49%


$

73,040


$

30,036


$

43,004


143%
























BALANCE SHEET AND LIQUIDITY
As of September 30, 2021, the Company had $100.8 million in cash and cash equivalents and $182.4 million in outstanding debt on its balance sheet compared to $63.4 million in cash and cash equivalents and $184.6 million in outstanding debt at December 31, 2020. The outstanding debt as of September 30, 2021 included $167.0 million related to the Company's credit agreement with Macquarie, $0.5 million of bank debt related to Casinos Poland, $7.7 million of bank debt related to Century Resorts Management GmbH ("CRM"), and $15.3 million related to a long-term land lease for Century Downs Racetrack and Casino ("CDR"), net of $8.1 million in deferred financing costs. The Company also has a $280.9 million long-term financing obligation under its triple net master lease ("Master Lease").

CONFERENCE CALL INFORMATION
Today the Company will post a copy of its quarterly report on Form 10-Q filed with the SEC for the quarter ended September 30, 2021 on its website at www.cnty.com/investor/financials/sec-filings/. The Company will also post a presentation of the third quarter results on its website at www.cnty.com/investor/presentations/.

The Company will host its third quarter 2021 earnings conference call today, Friday, November 5, at 8:00 am MDT. U.S. domestic participants should dial 1-844-244-9160. For all international participants, please use 330-931-4670 to dial-in. Participants may listen to the call live at centurycasinos.adobeconnect.com/earningsrelease or obtain a recording of the call on the Company's website until November 30, 2021 at www.cnty.com/investor/financials/sec-filings/.

* Amounts presented are rounded. As such, rounding differences could occur in period over period changes and percentages reported.
** Adjusted EBITDA and Adjusted EBITDA margin are Non-US GAAP financial measures. See discussion and reconciliation of Non-US GAAP financial measures in Supplemental Information below.
*** The Company defines book value per share as total Century Casinos, Inc. shareholders' equity divided by outstanding common shares.

 

CENTURY CASINOS, INC. AND SUBSIDIARIES
UNAUDITED FINANCIAL INFORMATION – US GAAP BASIS 

Condensed Consolidated Statements of Earnings (Loss)















For the three months

For the nine months


ended September 30,

ended September 30,

Amounts in thousands, except for per share information


2021


2020


2021


2020

Operating revenue:













Net operating revenue


$

116,610


$

95,706


$

281,207


$

219,466

Operating costs and expenses:













Total operating costs and expenses



90,883



80,692



229,118



238,338

Earnings (loss) from operations



25,727



15,014



52,089



(18,872)

Non-operating (expense) income, net



(10,755)



(10,630)



(31,528)



(32,496)

Earnings (loss) before income taxes



14,972



4,384



20,561



(51,368)

Income tax provision



(2,593)



(428)



(3,813)



(3,535)

Net earnings (loss)



12,379



3,956



16,748



(54,903)

Net (earnings) loss attributable to non-controlling interests



(1,153)



(208)



(86)



188

Net earnings (loss) attributable to Century Casinos, Inc. shareholders


$

11,226


$

3,748


$

16,662


$

(54,715)














Earnings (loss) per share attributable to Century Casinos, Inc. shareholders:

  Basic


$

0.38


$

0.13


$

0.56


$

(1.85)

  Diluted


$

0.36


$

0.13


$

0.54


$

(1.85)














Weighted average common shares













  Basic



29,598



29,576



29,584



29,553

  Diluted



31,242



29,709



31,059



29,553






















Condensed Consolidated Balance Sheets









September 30,


December 31,

Amounts in thousands


2021


2020

Assets







Current assets


$

129,216


$

94,622

Property and equipment, net



475,032



485,248

Other assets



93,614



100,890

Total assets


$

697,862


$

680,760








Liabilities and Equity







Current liabilities


$

59,514


$

60,163

Non-current liabilities



494,596



493,614

Century Casinos, Inc. shareholders' equity



135,937



118,154

Non-controlling interests



7,815



8,829

Total liabilities and equity


$

697,862


$

680,760

 

CENTURY CASINOS, INC. AND SUBSIDIARIES
UNAUDITED SUPPLEMENTAL INFORMATION

Adjusted EBITDA Margins **



For the three months

For the nine months


ended September 30,

ended September 30,


2021

2020

2021

2020

United States

33%

31%

35%

22%

Canada

37%

27%

20%

20%

Poland

14%

6%

(2%)

1%

Corporate and Other

(1095%)

(1688%)

(1547%)

(627%)

Consolidated

28%

23%

26%

14%






 

Reconciliation of Adjusted EBITDA* to Net Earnings (Loss) Attributable to Century Casinos, Inc. Shareholders by Reportable Segment.



For the three months ended September 30, 2021

Amounts in thousands



United States



Canada



Poland



Corporate and Other



Total

Net earnings (loss) attributable to Century Casinos, Inc. shareholders


$

12,389


$

5,308


$

1,437


$

(7,908)


$

11,226

Interest expense (income), net (1)



7,121



560



(355)



3,294



10,620

Income taxes





499



674



1,420



2,593

Depreciation and amortization



4,699



1,217



760



108



6,784

Net earnings attributable to non-controlling interests





435



718





1,153

Non-cash stock-based compensation









986



986

Gain on foreign currency transactions, cost recovery income and other





(57)



(232)



(24)



(313)

Loss on disposition of fixed assets





4



3





7

Adjusted EBITDA


$

24,209


$

7,966


$

3,005


$

(2,124)


$

33,056



















(1)

Expense of $7.1 million related to the Master Lease is included in interest expense (income), net in the United States segment. Expense of $0.5 million related to the CDR land lease is included in interest expense (income), net in the Canada segment. Cash payments related to the Master Lease and CDR land lease were $6.3 million and $0.4 million, respectively, for the period presented.

 

CENTURY CASINOS, INC. AND SUBSIDIARIES
UNAUDITED SUPPLEMENTAL INFORMATION

Reconciliation of Adjusted EBITDA* to Net Earnings (Loss) Attributable to Century Casinos, Inc. Shareholders by Reportable Segment.



For the three months ended September 30, 2020

Amounts in thousands



United States



Canada



Poland



Corporate and Other



Total

Net earnings (loss) attributable to Century Casinos, Inc. shareholders


$

7,656


$

1,880


$

86


$

(5,874)


$

3,748

Interest expense (income), net (1)



7,051



525



6



3,005



10,587

Income taxes (benefit)





469



123



(164)



428

Depreciation and amortization



4,506



1,345



777



196



6,824

Net earnings attributable to non-controlling interests





165



43





208

Non-cash stock-based compensation









354



354

Loss (gain) on foreign currency transactions and cost recovery income





30



(56)



69



43

Loss on disposition of fixed assets



9



11



2





22

Adjusted EBITDA


$

19,222


$

4,425


$

981


$

(2,414)


$

22,214



















(1)

Expense of $7.1 million related to the Master Lease is included in interest expense (income), net in the United States segment. Expense of $0.5 million related to the CDR land lease is included in interest expense (income), net in the Canada segment. Cash payments related to the Master Lease and CDR land lease were $6.2 million and $0.4 million, respectively, for the period presented.

 

CENTURY CASINOS, INC. AND SUBSIDIARIES
UNAUDITED SUPPLEMENTAL INFORMATION

Reconciliation of Adjusted EBITDA* to Net Earnings (Loss) Attributable to Century Casinos, Inc. Shareholders by Reportable Segment.



For the nine months ended September 30, 2021

Amounts in thousands



United States



Canada



Poland



Corporate and Other



Total

Net earnings (loss) attributable to Century Casinos, Inc. shareholders


$

39,486


$

265


$

(1,432)


$

(21,657)


$

16,662

Interest expense (income), net (1)



21,083



1,263



(341)



9,825



31,830

Income taxes (benefit)





661



(216)



3,368



3,813

Depreciation and amortization



13,734



3,689



2,320



317



20,060

Net earnings (loss) attributable to non-controlling interests





802



(716)





86

Non-cash stock-based compensation









1,568



1,568

Gain on foreign currency transactions, cost recovery income and other





(604)



(221)



(436)



(1,261)

Loss (gain) on disposition of fixed assets



282



36



3



(39)



282

Adjusted EBITDA


$

74,585


$

6,112


$

(603)


$

(7,054)


$

73,040



















(1)

Expense of $21.1 million related to the Master Lease is included in interest expense (income), net in the United States segment. Expense of $1.2 million related to the CDR land lease is included in interest expense (income), net in the Canada segment. Cash payments related to the Master Lease and CDR land lease were $16.8 million and $1.3 million, respectively, for the period presented.

 

CENTURY CASINOS, INC. AND SUBSIDIARIES
UNAUDITED SUPPLEMENTAL INFORMATION

Reconciliation of Adjusted EBITDA* to Net Loss Attributable to Century Casinos, Inc. Shareholders by Reportable Segment.



For the nine months ended September 30, 2020

Amounts in thousands



United States



Canada



Poland



Corporate and Other



Total

Net loss attributable to Century Casinos, Inc. shareholders


$

(35,999)


$

(4,102)


$

(1,134)


$

(13,480)


$

(54,715)

Interest expense (income), net (1)



21,286



1,504



23



9,719



32,532

Income taxes (benefit)



1,023



2,281



(123)



354



3,535

Depreciation and amortization



13,008



3,973



2,279



463



19,723

Net earnings (loss) attributable to non-controlling interests





377



(565)





(188)

Non-cash stock-based compensation









589



589

Loss (gain) on foreign currency transactions and cost recovery income





101



91



(6,976)



(6,784)

Impairment - intangible and tangible assets (2)



30,746



3,375





1,000



35,121

Loss (gain) on disposition of fixed assets



9



(58)



4



2



(43)

Acquisition costs









266



266

Adjusted EBITDA


$

30,073


$

7,451


$

575


$

(8,063)


$

30,036



















(1)

Expense of $21.3 million related to the Master Lease is included in interest expense (income), net in the United States segment. Expense of $1.5 million related to the CDR land lease is included in interest expense (income), net in the Canada segment. Cash payments related to the Master Lease and CDR land lease were $16.7 million and $1.3 million, respectively, for the period presented.

(2)

Expense of $30.7 million and $3.4 million is included in the United States and Canada segments, respectively, related to the impairment of goodwill and intangible assets. Expense of $1.0 million is included in the Corporate and Other segment related to the impairment of the Company's investment in Mendoza Central Entretenimientos S.A.

CENTURY CASINOS, INC. AND SUBSIDIARIES
UNAUDITED SUPPLEMENTAL INFORMATION
*  The Company defines Adjusted EBITDA as net earnings (loss) attributable to Century Casinos, Inc. shareholders before interest expense (income), net, income taxes (benefit), depreciation and amortization, non-controlling interests net earnings (loss) and transactions, pre-opening expenses, acquisition costs, non-cash stock-based compensation charges, asset impairment costs, (gain) loss on disposition of fixed assets, discontinued operations, (gain) loss on foreign currency transactions, cost recovery income and other, gain on business combination and certain other one-time transactions. Expense related to the Master Lease and CDR land lease is included in the interest expense (income), net line item. Intercompany transactions consisting primarily of management and royalty fees and interest, along with their related tax effects, are excluded from the presentation of net earnings (loss) attributable to Century Casinos, Inc. shareholders and Adjusted EBITDA reported for each segment. Non-cash stock-based compensation expense is presented under Corporate and Other as the expense is not allocated to reportable segments when reviewed by the Company's chief operating decision makers. Not all of the aforementioned items occur in each reporting period, but have been included in the definition based on historical activity. These adjustments have no effect on the consolidated results as reported under US GAAP. Adjusted EBITDA is not considered a measure of performance recognized under US GAAP. Management believes that Adjusted EBITDA is a valuable measure of the relative performance of the Company and its properties. The gaming industry commonly uses Adjusted EBITDA as a method of arriving at the economic value of a casino operation. Management uses Adjusted EBITDA to compare the relative operating performance of separate operating units by eliminating the above-mentioned items associated with the varying levels of capital expenditures for infrastructure required to generate revenue and the often high cost of acquiring existing operations. Adjusted EBITDA is used by the Company's lending institution to gauge operating performance. The Company's computation of Adjusted EBITDA may be different from, and therefore may not be comparable to, similar measures used by other companies within the gaming industry. Please see the reconciliation of Adjusted EBITDA to net earnings (loss) attributable to Century Casinos, Inc. shareholders above.

** The Company defines Adjusted EBITDA margin as Adjusted EBITDA divided by net operating revenue. Adjusted EBITDA margin is a non-US GAAP measure. Management uses this margin as one of several measures to evaluate the efficiency of the Company's casino operations.

ABOUT CENTURY CASINOS, INC.:
Century Casinos, Inc. is a casino entertainment company. The Company owns and operates Century Casino & Hotels in Cripple Creek and Central City, Colorado, and in Edmonton, Alberta, Canada; the Century Casino in Cape Girardeau and Caruthersville, Missouri, and in St. Albert, Alberta, Canada; Mountaineer Casino, Racetrack & Resort in New Cumberland, West Virginia; the Century Mile Racetrack and Casino ("CMR") in Edmonton, Alberta, Canada; and Century Bets! Inc. ("CBS"). CBS and CMR operate the pari-mutuel off-track horse betting networks in southern and northern Alberta, respectively. Through its Austrian subsidiary, CRM, the Company holds a 66.6% ownership interest in Casinos Poland Ltd., the owner and operator of eight casinos throughout Poland; and a 75% ownership interest in Century Downs Racetrack and Casino in Calgary, Alberta, Canada. The Company has an agreement to operate two ship-based casinos. The Company continues to pursue other projects in various stages of development.

Century Casinos' common stock trades on The Nasdaq Capital Market® under the symbol CNTY.

For more information about Century Casinos, visit our website at www.cnty.com.

CENTURY CASINOS, INC. AND SUBSIDIARIES
UNAUDITED SUPPLEMENTAL INFORMATION
This release may contain "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, Section 21E of the Securities Exchange Act of 1934, as amended, and the Private Securities Litigation Reform Act of 1995. These statements are based on the beliefs and assumptions of the management of Century Casinos based on information currently available to management. Such forward-looking statements include, but are not limited to, the hotel and casino projects in Missouri, statements regarding future results of operations, including statements about operating margins, the impact of the current coronavirus (COVID-19) pandemic, estimates of the financial impact of COVID-19, the adequacy of cash flows from operations and available cash to meet our future liquidity needs, particularly if we cannot operate our casinos due to COVID-19 or their operations are restricted, operating efficiencies, synergies and operational performance, the prospects for and timing and costs of new projects, projects in development and other opportunities, our credit agreement with Macquarie and obligations under our Master Lease and our ability to repay our debt and other obligations, investments in joint ventures, outcomes of legal proceedings, changes in our tax provisions or exposure to additional income tax liabilities, and plans for our casinos and our Company. Such forward-looking statements are subject to risks, uncertainties and other factors that could cause actual results to differ materially from future results expressed or implied by such forward-looking statements. Important factors that could cause actual results to differ materially from the forward-looking statements include, among others, the risks described in the section entitled "Risk Factors" under Item 1A in our Annual Report on Form 10-K for the year ended December 31, 2020, and in subsequent periodic and current SEC filings we may make. Century Casinos disclaims any obligation to revise or update any forward-looking statement that may be made from time to time by it or on its behalf.

 

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SOURCE Century Casinos, Inc.

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