Penn National Gaming Losses Narrow
| February 5, 2010 Casino and racetrack operator Penn National Gaming Inc. reported a smaller fourth-quarter loss even as gamblers spent less at its properties. The company said it expects gamblers' conservative spending habits are likely to continue this year, and provided full-year and first-quarter profit outlooks below analysts' expectations. The economic downturn has prompted consumers to tighten their spending, and gamblers have pulled back on how much they spend at slot machines and on table games as well as what they shell out for food, drinks and entertainment offered by casino complexes. "We have limited control over how consumers are continuing to respond to economic pressures and as a result, the gaming industry experienced revenue compression again in the fourth quarter," chairman and CEO Peter Carlino said in a statement. Anticipating a continued spending clampdown, Penn predicts full-year earnings of $1 per share on revenue of $2.43 billion. For the first quarter, it forecast a profit of 23 cents per share on revenue of $596.7 million. Analysts surveyed by Thomson Reuters expect higher 2010 earnings of $1.39 per share on revenue of $2.52 billion, and see a bigger first-quarter profit of 34 cents per share on revenue of $634.7 million. These estimates typically exclude one-time items. Penn lost $355.4 million, or $4.54 per share, in the three months ended Dec. 31 compared with a loss of $378.6 million, or $4.77 per share, a year earlier. Analysts predicted a profit of 18 cents per share. Net revenue dropped 3% to $555.8 million from $571.1 million, with declines in gaming, food and beverage revenue. The results fell short of Wall Street's $573.6 million. |
