Bally's Stock Crashes - Management Cancels Earnings Call

Bally's stock price plunged Wednesday following news of 5.1 percent revenue decrease.

Gaming industry analyst Alfonso Straffon commented via Twitter followed by a s*** emoji:

"Generally not a good sign when management cancels the earnings call the day of the release, as was scheduled..."

The stock price dropped as much as 24% at one point.

Generally not a good sign when management cancels the earnings call the day of the release, as was scheduled...

— Alfonso Straffon  (@astraffon) March 5, 2025

Bally’s imploded the Tropicana Las Vegas in October, clearing the way for development of a Major League Baseball stadium on the Las Vegas Strip. Its primary focus since that time has been on a casino development in Chicago.  During this period a major stockholder took control over the company.

One bright spot perhaps, U.K. online revenue grew 11.3%.  Also of note, North America Interactive revenue of $41.5 million was up 24.4% year over year.

Overall International Interactive revenue declined 9.1% year over year to $214.5 million, however.

Company officials attempted to paint lipstick on this pig, so to speak.

Robeson Reeves, Bally’s Chief Executive Officer, commented, “Fiscal 2024 was a transformational and transitional year for Bally’s as we funded and began development of our permanent Chicago casino resort and completed the controlled demolition of the Tropicana in Las Vegas paving the way for Major League Baseball’s A’s franchise to move to the site. Following these milestones, in early 2025 Bally’s completed a series of transactions with The Queen Casino & Entertainment (“Queen”) and Standard General which has further expanded our scale and positioned the Company for compelling long-term growth.

“The ‘new’ Bally’s 2.0 is a dynamic global land-based and online casino operator with attractive growth pipelines in U.S. gaming. Reflecting the now completed strategic transactions, the four complementary Queen casinos are poised to continue their rapid growth as they benefit from inclusion in a broader domestic gaming portfolio, with Bally’s benefiting from the expansion and diversification of our geographic profile. We emerged from these transactions significantly stronger, with the financial and operating wherewithal to continue to drive growth across our expanded Casinos & Resorts (“C&R”) segment, our International Interactive business and our North America Interactive segment.

“C&R fourth quarter segment results reflect the underlying stability in the domestic regional gaming environment offset by several ongoing pockets of relative weakness, which are inherent across any broad property portfolio. Segment Adjusted EBITDAR declined 14.6% year over year to $80.9 million reflecting higher costs and lower flow-through exacerbated by the revenue decline. Our Chicago Temporary Casino’s results were consistent with prior quarters as they remain below our expectations, though we are hearing from customers that they are increasingly excited by what is starting to happen a few blocks northwest at the permanent site. Rhode Island visitation remains a challenge given the ongoing local bridge construction, with our Lincoln property impacted particularly at peak times. Atlantic City’s performance continues to reflect the impact of the turnover in our relationship marketing team though we believe this issue has largely been addressed. Partially offsetting these challenges was strength in markets such as Kansas City where our business benefited from the opening of a new high-limit room in the quarter. In addition, while not included in our fourth quarter results, the Queen properties combined to generate fourth quarter revenue of $57.6 million and Adjusted EBITDAR of $15.2 million.

“International Interactive revenue continues to benefit from strength in our U.K. operations, offset by ongoing weakness in certain non-U.K. markets. While segment-level revenue declined 9.1% to $214.5 million, U.K. revenue grew a healthy 11.3% (7.9% in constant currency). U.K growth was driven by strong player retention and uplifts from revenue optimization initiatives. Adjusted EBITDAR margins declined 145 basis points year over year, leading to overall International Interactive Adjusted EBITDAR of $81.6 million, down 12.4% year over year. During the quarter, we announced the divestiture of the distribution operations of our interactive business in Asia and certain other international markets to a new independently managed company. As a result of the divestiture, we have deconsolidated the operations and changed the accounting presentation to purely licensing revenues. Excluding revenue recognized from divested markets and licensing revenue recognized, International Interactive revenue grew 12.9% versus the prior year quarter, demonstrating the strong underlying financial performance of this business that is now focused primarily on regulated European markets.

“Underlying results for the North America Interactive segment demonstrated favorable performance across the board, with revenue up 24.4% and an Adjusted EBITDAR loss of $12.3 million. That said, segment performance was negatively impacted during the quarter by the transition to a new unified platform, an impact we expect will reverse itself in the first quarter. Rhode Island continued to ramp as it captured some of the play lost at our brick-and-mortar properties due to the previously mentioned bridge construction issues. During the quarter we launched the Monopoly Casino app in New Jersey to very healthy customer response and launched our Bally Bet online sports betting platform in Tennessee. We continue to gain strong customer support for our iGaming and sports product offerings which we believe will result in positive long-term performance from this segment.”

George Papanier, Bally’s President, added, “Fourth quarter revenue performance in our C&R segment reflects our ongoing work to unify our regional gaming portfolio, efforts which will accelerate now that the four Queen assets have been added to our business, as well as lingering pockets of relative weakness in certain portions of our geographic reach as previously noted. Despite this, Bally’s many growth opportunities remain firmly intact. We received final approval from the City of Chicago for our re-imagined permanent Bally’s Chicago Casino master plan in December, and we recently completed demolition and began construction at the permanent development site. Site work on the former Tropicana land continues and the A’s are making good progress towards the start of their stadium construction later this year while Bally’s progresses on the realization of a more fully fleshed out integrated resort master plan for the remainder of our extremely valuable site. Further, the landside conversions at Queen's Belle of Baton Rouge and Casino Queen Marquette remain on schedule, providing two of our newest assets with an attractive runway for growth on par with similar conversions across the industry. Importantly, the entire Queen portfolio is benefiting or poised to benefit from the repositioning of these assets which will provide our C&R segment with a nice tailwind for the foreseeable future. Collectively, these growth opportunities and our own ability to operate more efficiently and effectively across the portfolio have us optimistic for 2025 and beyond.”

Marcus Glover, Bally’s Chief Financial Officer, concluded, “As we close out 2024 and begin 2025, our team is working diligently across multiple fronts to optimize our cost structure, enhance the efficiency of our operations, adopt certain best practices from Queen, and set the stage for significant long-term value creation. We look forward to learning from our newest team members who came to Bally’s from Queen and we’re working hand in hand with the team at Standard General to take an end-to-end look at our business. Bally’s 2.0 is very well positioned to deliver enhanced value for all of our stakeholders that are invested in the Company’s future and we look forward to reporting on our successes in the coming quarters and years.”