Caesars reports Q3 loss despite revenue rise as Rio sale nears

Caesars Entertainment has provided updates to its Rio All-Suite Hotel and Casino sale and Eldorado Resorts merger, amid increasing revenue during the year’s third quarter.

In September, Caesars announced an agreement to sell the Rio for $516.3m, with the agreement expected to close by the end of 2019.

The firm will continue to operate the property for a minimum of two years pursuant to a lease agreement to be executed at the closing, with it also remaining as part of the Caesars rewards network during this term.

Furthermore, Caesars also states that significant progress has been made on the integration planning process with Eldorado, with the merger of the two companies remaining on track to close in the first half of 2020, subject to all required regulatory approvals.

Providing the updates in its latest financial reports, Caesars saw net loss plummet to $359m from a net income of $110m despite revenue increasing 2.3 per cent from $2.18bn from $2.24bn.

The firm states that the revenue increase is primarily driven by growth across all business verticals, with a significant boost reported in Las Vegas where gaming revenue rose 17.3 per cent year-over-year due to favourable hold and higher gaming volumes. 

Other US net revenues declined $6m to $1.11bn due to competition in Atlantic City and Southern Indiana, with all other revenue also decreasing $6m primarily due to lower gaming volumes in the UK. 

Across all casino properties hold had a favourable impact in the region of $31m to $36m in the quarter compared to the prior year, and was between $10m to $15m above expectations.

Tony Rodio, CEO of Caesars Entertainment, provided a positive outlook: “We are pleased to have delivered solid financial results in the third quarter with net revenue growth across all business verticals, despite headwinds across our portfolio. 

“Revenue performance was driven by our Las Vegas region due to increased consumer demand, with particular strength in the hotel business which continues to outpace prior years across properties. Coupled with corporate expense reductions, this led to strong adjusted EBITDA growth as well as margin expansion.”