Online Gaming Profits Soar At Hollywood Casino While Live Slot And Table Play Declines

© Dan Gleiter | dgleiter/pennlive.Com/TNS Penn National Gaming Inc., which operates the Hollywood Casino at Penn National Race Course, plans to buy a casino in Detroit for $300 million. Soaring revenues from Internet-based gambling propelled the parent company of Hollywood Casino at Penn National Race Course to a handsome third-quarter profit, but in-person wagering on slot machines and table games at its Grantville property continued to slide. CONSTELLATION BRANDS, INC. Publicly traded Penn Entertainment (PENN) reported third-quarter revenues of $1.63 billion and an overall profit of $123.5 million Thursday that exceeded the expectations of Wall Street analysts. Yet, company executives admitted during Thursday’s third-quarter earnings conference call that soft business in the Northeast, particularly in central and western Pennsylvania, is mainly due to the increasing amount of casino competition. “The Northeast has been weaker and it’s been more Pennsylvania,” said Todd George, executive vice-president of operations for Penn Entertainment. “There’s been a little more noise in Pennsylvania and the impact has been from new competition. We’ve been fortunate with our newer properties (in York and Morgantown), but at our existing properties (in Grantville and The Meadows in Washington) did lose some share.” And, even more competition is on the way within Pennsylvania’s borders, as more brick-and-mortar properties are expected to open next year in Cumberland and Centre counties. A satellite pgslot owned by Greenwood Gaming Inc. Of Bensalem, named Parx Casino Shippensburg, is under construction at 250 South Conestoga Drive in Shippensburg and is scheduled to open in early 2023. Bally’s Corporation of Providence, R.I., in partnership with businessman Ira Lubert’s SC Gaming, is moving on a tentative agreement with College Township to build a 94,000-square-foot facility at the mostly vacant Nittany Mall. The proposed $123 million casino, which has been the subject of fierce public opposition, would be located about four miles from the Penn State campus. Penn Entertainment Chief Executive Officer Jay Snowden said he expected the company will remain profitable in 2023 as it continues appeals to a younger 21-to-44-year-old, mostly male demographic that plays Internet casino games and wagers on sports. Snowden added that profits will be reinvested into the company’s existing properties. Chief Financial Officer Felicia Hendrix that Penn Entertainment expects “economic headwinds” in coming months due to inflation and rising interest rates, but added the company still expects to offer a “high quality” product. September revenues at Hollywood Casino at Penn National Race Course rose to $65.9 million, an 18% year-over-year increase, mostly due to Internet gaming and sports wagering, according to Pennsylvania Gaming Control Board figures released in October. That placed Hollywood at PNRC at the top of the September revenue standings. But, live slot machine revenue in Grantville fell 20% in July and August and 12% in September to $12 million. Live table games revenue in September fell a modest 3.64% to $2.1 million. The three-month plunge is far steeper than the average combined 0.18% decrease in live slots revenue experienced by the other 16 Pennsylvania casinos in September. Meanwhile, the company’s York and Morgantown “mini-casinos” – satellite locations that can feature up to 750 slot machines and 40 table gaming, have posted strong recent numbers. Hollywood Casino York boasted a healthy 21.83% year-over-year- increase in live slot play to $6.5 million and a 12.54 % boost in live table games revenue to $1.6 million. The York facility, located in the York Galleria Mall off Route 30, opened in April, 2021. Hollywood Casino Morgantown, located off the Pennsylvania Turnpike, opened in December, 2021. Its live table game revenue for September was $853,815 and its live slot revenue was $4.1 million Company officials noted on the conference call that Hollywood Casino’s current player loyalty program, currently called mychoice, will be re-branded in early 2023. In addition to a new name, changes are forthcoming to how player can use and spend their earned slot points. Highlights of Penn Entertainment’s third-quarter activity included acquiring the remaining shares of Barstool Sports in a $387 million deal that will close in February 2023. Penn Entertainment paid $163 million for a 36 percent stake in 2020 and had only recently paid $62 million more to up the stake to 50 percent. The company announced $850 million in property investment initiatives, including moving current riverboat properties to brick-and-mortar locations in Aurora and Joliet, Illinois and an expansion of its M Resort, eight miles south of the Las Vegas Strip. Penn Entertainment closed last month on its $308 million sale of Tropicana Las Vegas on the Las Vegas Strip to Bally’s Corp. The company retains the land the resort sits on through a real estate trust and will collect $10.5-million per year in rent during the 50-year lease. ©2022 Advance Local Media LLC. Visit pennlive.Com. Distributed by Tribune Content Agency, LLC.

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