- Legal States
Julie Moraine February 26, 2020 3 min read
Caesars Entertainment Posted $1.2B Net Loss In Fiscal 2019 Year
Caesars Entertainment Corporation reported today results from the fourth quarter of 2019, as well as results for the full fiscal 2019 year ending June 30, and despite an increase in net revenues, the net result of $1.2 billion loss marks a significant drop in profitability for the largest casino operator in Nevada.
Q4 Up But 2019 Down
Caesars Entertainment, the company that is in the process of being acquired by its smaller competitor, Eldorado Resorts, in a $17.3 billion deal that is expected to be completed later this year, posted an increase of 2.6% of net revenues from $2.12 billion to $2.17 billion for Q4, and 4.2% increase in the full-year revenue from $8.39 billion to $8.74 billion.
Income from operations of the company, though going up 77% from $100 million to $177 million in the fourth quarter, went down for the fiscal year 16.4%, from $739 million to $618 million.
Caesars Non-GAAP adjusted EBITDA increased 2.8%, $16 million, from $567 million to $583 million for the final quarter of 2019 and 4.2%, $97 million, from $2.31 billion to $2.41 billion for the full year.
Excluding the sale of Rio Hotel & Casino for $516.3 million, Q4 Non-GAAP adjusted EBITDA increased 3.4%, $19 million, to a total of $572 million.
But most importantly, Caesars reported a net loss for Q4, from an income of $198 million to a loss of $304 million, and for the full year the drop is immense, $1.5 billion, as in 2018 it posted $303 million profit compared to the huge $1.2 billion loss posted now.
Events For Consideration
There were a number of significant events for Caesars Entertainment during the fiscal year that put their mark on its financial numbers.
Everything started in November, when Caesars Entertainment and Eldorado Resorts held separate Special Meetings of Stockholders, and approved certain actions in connection with the proposed merger, with the transaction expected to be consummated in the first half of 2020 and remain subject certain regulatory gaming and other approvals, as well as other closing conditions.
In December, the company completed the sale of the Rio All-Suite Hotel & Casino for $516.3 million, but preserved the right to continue to manage and operate it through a lease agreement for a minimum of two years, with the property remaining part of the Caesars Rewards network during the lease.
In January 2020, Caesars Entertainment and VICI Properties signed an agreement for the sale of Harrah’s Reno for $50 million, with transaction proceeds split 75% to VICI and 25% to Caesars, and Caesars continuing to operate the property upon closing of the transaction.
Caesars Strip Properties For Sale?
Property sales turn out to be a main source of funding for Eldorado Resorts, too, as there emerged reports suggesting its management strongly considers selling Strip properties after the completion of the merger deal.
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Business February 26, 2020
Business February 26, 2020