Full House sees revenue down in 2022, officials pleased with early Waukegan casino response

Casino developer and operator Full House Resorts has announced its financial results for the fourth quarter and full year 2022. For Q4, the company posted revenue of $36.1 million, a decrease from $43.3 million in the prior-year period; and as for the full year, revenues were down by almost $17 million to $163.3 million.

Management noted that the past year faced tough comparatives against 2021, which benefited from guests receiving government stimulus checks. In 2022, the company’s net loss widened to $14.8 million and Adjusted EBITDA dropped to $32.1 million. A similar picture occurred for Q4 in specific, a quarter in which the business posted a $7 million loss, compared to net income of $5 million in fourth quarter 2021.

The company said that a decrease of $4 million in Adjusted EBITDA for the fourth quarter came at a seasonally slow quarter, which also reflected adverse weather in December, construction disruptions at the Bronco Billy’s Casino and Hotel in Colorado, the launch of competing online sports wagering in Louisiana, and increase in certain expenses. Despite these setbacks, officials showed optimism about the company’s future, as it eyes new projects and expansions.

“On February 17th, The Temporary by American Place officially opened to the public,” said Daniel R. Lee, President and Chief Executive Officer of Full House Resorts. “We are very pleased with the positive response received from guests thus far, with many commenting that The Temporary is one of the nicest casinos in the area, despite being in a temporary structure. In its first twelve days of operation, we welcomed more than 40,000 guests through its doors.”

The temporary casino in Waukegan, Illinois, opened at less than full capacity. For instance, on opening night, only about 80%  of the slot floor and 60% of the permitted table games were available. However, over the coming weeks, Full House expects to further augment the number of available games on its floor and increase the hours of operation for its table games.

“As our team gains more experience, we also expect to operate the casino 24 hours per day, versus our current schedule of 8 a.m. to 4 a.m.,” noted Lee. And with the casino currently operating only one of its restaurants, L’Américain, two more options – the Asia-Azteca fusion restaurant and the North Shore Steaks and Seafood – are expected to open in the next few weeks and in the second quarter respectively.

“Given the early response to The Temporary, we remain confident in our ability to generate attractive returns from both The Temporary and our future American Place destination,” commented management, which also highlighted ongoing progress in the construction of the Chamonix project in Cripple Creek, Colorado. 

Rendering for the proposed Chamonix project

Drywall is being installed in guest rooms and the public areas of the Colorado casino. Full House recently installed escalators from the entry level up to the second-floor meeting space, and is preparing for the installation of elevators. The business continues to target an opening later this year, “potentially with a phased opening beginning in the third quarter of 2023.”

As for other Q4 highlights and results, management noted revenues at Mississippi’s Silver Slipper Casino and Hotel were slightly down to $18.4 million, adversely affected by the competitive launch of online sports betting within nearby Louisiana and colder-than-normal temperatures. Additionally, the period saw “significant marketing promotions” at a nearby competitor. Adjusted Segment EBITDA fell by $2.7 million to $4 million.

Indiana’s Rising Star Casino Resort saw a slight revenue decrease to $ million in Q4, also adversely affected by significant snowstorms. Full House also noted the opening of a new HHR competitor in nearby Northern Kentucky in September 2022. For the year, revenues in the Indiana segment fell 5.7%.

The Colorado gaming market, which includes Bronco Billy’s Casino and Hotel, and upon its opening Chamonix Casino Hotel, has shown significant growth since betting limits were eliminated in May 2021. However, Bronco Billy’s has incurred “significant construction disruption,” including temporarily-reduced gaming and restaurant capacity and the absence of all on-site hotel rooms, and Q4 revenues were down $1.5 million to $5 million.

Bronco Billy's

Prior to the pandemic and commencement of construction, Bronco Billy’s had 827 slot machines and 10 table games. However, approximately 41% of its pre-existing gaming space was closed in November 2021 to facilitate the construction of Chamonix, with further gaming space shut down in 2022. While a refurbished portion of the casino reopened in late December, the property continues to operate today with approximately half the gaming positions than it had pre-pandemic.

Lastly, Nevada, where the company operates the Grand Lodge Casino, was slightly down from $4.3 million in Q4 2021 to $4.1 million last quarter amid a significant snowstorm in the Lake Tahoe area, with snowfall lasting until late on the important New Year’s Eve holiday. However, for the year, revenue in this segment rose 7.7%, reflecting tourism recovery in the region.

Company operations also took a hit in the Contracted Sports Wagering segment, which consists of on-site and online sports wagering “skins” in Colorado, Indiana and, upon launch, Illinois. Revenues and Adjusted Segment EBITDA were both $1.1 million in Q4 2022, versus $1.8 million in 2021. These results reflect two agreements that ceased operations in May 2022 as one contracted party ended its online operations.

In December, Full House executed a new agreement with a replacement operator for its Colorado sports skin, which began its term this week. As for its available skin in Indiana, the company said it is evaluating “the best use,” including whether to utilize it itself or find a replacement third-party operator.