Century Casinos experiences net loss in 2023 due to rising costs

Century Casinos, Inc. has recently released the company’s financial reports pertaining to the Fiscal Year 2023, revealing a total net loss of $28.2 million. 

Representatives of Century Casinos have stated that this net loss was accrued due to exponentially rising costs that they experienced during the year 2023. 

Despite reporting a significant increase in revenue from the previous year, the rising costs experienced throughout 2023 have drastically cut into this net revenue, ensuring that the company ultimately experienced a net loss of millions. 

Below, we have gone into much further detail regarding this overall net loss, depicting the specific statistical figures representing the entire 2023 Fiscal Year of Century Casinos, Inc., and more specifically, the Fourth Quarter of the FY23.

The Fiscal Year 2023 

Highlights of the Fiscal Year 2023 

• “Net operating revenue was $550.2 million, an increase of 28%.” 

• “Earnings from operations were $64.0 million, a decrease of (5%).” 

• “Net loss attributable to Century Casinos, Inc. shareholders was ($28.2) million, a change of (454%), and basic loss per share was ($0.93).” 

• “Adjusted EBITDAR** was $114.0 million, an increase of 10%.” 

The Q4 FY23 

Highlights of the Fourth Quarter of the Fiscal Year 2023 

• “Net operating revenue was $143.8 million, an increase of 39%.” 

• “Earnings from operations were $12.6 million, a decrease of (9%).” 

• “Net loss attributable to Century Casinos, Inc. shareholders was ($10.8) million, a change of (168%), and basic loss per share was ($0.36).” 

• “Adjusted EBITDAR** was $25.4 million, an increase of 17%.” 

Breakdown of revenue growth across different markets 

Increase in Revenues in 2023 

Century Casinos, Inc. has reported a significant increase in revenues during the fiscal year 2023. 

As can be viewed in the table above, the main contributor of this rapid surge in revenue growth is the company’s performance in the United States. 

In this way, the US iGaming market continues to be a pivotal point for Century Casinos. 

According to financial experts, the main reasons that can be attributed to this considerable increase in revenue can be summarized as follows: 

• Strategic business maneuvers 

• Enhanced market presence across all sectors of the market 

• Strategic diversification 

• Investment in innovation 

• Bolstering of their portfolio with strategic acquisitions, and thus the company’s strategic expansion 

In line with the company’s goal for strategic expansion, the following are some of the key acquisitions that took place in 2023 that had an integral role in increasing Century Casinos’ overall net revenue: 

• Nugget Casino Resort, Nevada 

• Rocky Gap Casino Resort, Maryland  

Co-Chief Executive Officers of Century Casinos, Erwin Haitzmann and Peter Hoetzinger, have expressed their positive outlook towards the year to come, and are very hopeful for the firm’s upwards trajectory during 2024. 

With this aim in mind, the Co-CEO's have shared what they have claimed to be robust strategic plans and market agility. These improvements, they believe, form the backbone of Century Casinos’ future: 

• Increased innovation in product offerings 

• Improved and strengthened customer engagement strategies 

• The expansion of the company into new markets 

Overview of these Financial Results 

In light of this statistical data, it is evident that the fiscal year 2023 brought with it several financial challenges for Century Casinos, Inc., with fluctuating operating expenses and non-operating costs drastically impacting the company’s bottom lines. 

The following are some of the key highlights of Century Casinos’ financial results: 

• A substantial increase in operating expenses due to inflation, the rising costs that come with it, and supply chain distributions. 

• There was also a substantial increase in non-operating costs, including interest expenses. This increase can be attributed to higher borrowing rates. 

• The EBITDAR ('earnings before interest, taxes, depreciation, amortisation and restructuring or rent costs') showed resilience. This indicates that several effective cost management strategies were implemented among firms during this fiscal year. 

Despite the increased expenses that plenty of companies have been battling during the economic uncertainties that recent years have been fraught with, maintaining and improving profitability still remains possible with the implementation of strategic planning and cost management strategies. 

Comments made with regards to these results 

Messrs. Haitzmann and Hoetzinger, Co-Chief Executive Officers of Century Casinos, stated the following: 

“We anticipated a challenging first quarter due to continuing construction disruptions and the closure of three of our casinos in Poland for some or all of the quarter.  The quarter was further impacted by disruptions from severe weather at the majority of our US casinos.  Cash payments of $12.2 million for taxes related to the September 2023 sale and leaseback of our Canada properties and a $3.4 million one-time principal paydown of debt as well as $18.4 million in property and equipment purchases decreased our overall cash balance.”  

“Our positive outlook for the second half of 2024 into 2025 remains unchanged. Our increased spend on capital projects throughout our properties is expected to end over the summer. Our largest capital project (fully funded by VICI Properties Inc.), the land-based casino in Caruthersville, Missouri, is also expected to be completed by the end of the year. By 2025, all of our operations should be in great shape with no more construction disruptions and all casinos in Poland fully operational. We are also excited about the performance of The Riverview, our new hotel at Century Casino Cape Girardeau, Missouri, which has exceeded our expectations so far.”  

In addition to this, Messrs. Haitzmann and Hoetzinger remarked on the following: 

"2023 was a transitional year for Century. We completed two major acquisitions to expand our US portfolio to seven casinos. We continued our large construction projects in Missouri, which remain on time and on budget to open in early April for the Cape Girardeau hotel and late 2024 for the Caruthersville casino and hotel.  

"Unanticipated licensing delays that resulted in closures of three of our casinos in Poland in the fourth quarter caused earnings from operations in Poland to decrease compared to 2022. We have been awarded all three licenses, we reopened one casino in February 2024 and anticipate reopening the second casino this month and the final casino in a new location in the third quarter of 2024. We are excited to look forward to 2025, when our newly acquired casinos are fully integrated into the company and to what we anticipate will be our first year since 2022 with no significant construction or renovation disruptions at our properties."