Pinnacle Entertainment, one of Nevada’s leading regional casino operators, surprised the folks on Wall Street by posting profits for the first quarter for this year. The results were a definite surprise to those in the financial sector as most market analysts had comfortably predicted that the company would report net losses following Pinnacle’s recent combination of management shake-up and general market direction changes.
The Las Vegas-based Pinnacle, which owns and operates casinos in Nevada, Indiana, Missouri, Louisiana and Argentina, reported yesterday that its earnings had leapt to $36.7 million which translates to 60 cents per share for the financial quarter ending on March 31st as compared to their profit posting of $931,000, or two cents per share, exactly one year ago. All analysts that were surveyed by Thompson Reuters expressed their surprise at the company’s results as many were predicting a loss of around 11 cents per share for Pinnacle following its recent upheavals.
The company’s revenue for the quarter climbed by 3% to $267.4 million, rising from $259.2 million. Pinnacle also reported that the company’s overall results were aided by strong gains directly linked to property sales coupled with a specific insurance claim settlement. Pinnacle also reported that its St. Louis-based Lumiere Palace Resort had posted very strong revenues as well as what the company called “record adjusted cash flow.”
The company also stated that revenues had also been boosted by the fact that, in general, customers had been spending more in terms of actual gambling, hotel rooms, as well as spending more on food and beverages, entertainment and shopping, all of which marks a definite chance since the beginning of the global recession which saw customers reigning in their spending – especially on gambling.
During the first quarter Pinnacle scaled down its plans for development in Lake Charles, which also comes on the back of the company’s decision early in 2010 to pull out of their proposed $2 billion hotel and casino project in Atlantic City. The company is also known to have prospered from its newly opened casino in the suburbs of St. Louis.
According to Pinnacle’s new chief executive officer, Anthony Sanfilippo, who only took up his post last month, Pinnacle is now looking to consolidate its scope of existing operations rather than looking to expand. He went on the add that the success of Pinnacle’s first quarter strategies should stand the company in good stead to make further progress throughout the coming year. According to Steven Wieczynski, gaming analyst at Stifel Nicolaus Capital Markets, the results are likely to bode well for other regional casino operators as they indicate that consumer spending “is beginning to show signs of life.”
Related posts:
No user commented in " Pinnacle’s First Quarter Surprise "
Follow-up comment rss or Leave a TrackbackLeave A Reply