Penn National Gaming Down In First Quarter Reports

• Penn National Gaming has lost money during the first quarter of 2020 because of the closures of their properties amid the Coronavirus pandemic.
• The company has enough money to withstand the remainder of the year if it should need to be closed that long.

NEW YORK – Penn National Gaming released their first-quarter reports on Thursday and have shown a huge loss as a result of the Coronavirus pandemic.

The gaming company has 41 different locations that gave them record highs in revenue for the months of January and February 2020. However, the shutdown of their establishments because of the COVID-19 outbreak has led to an overall loss of profits for the quarter.

The Quarterly Report

The first quarter ended on March 31, 2020, for Penn National Gaming. The year began on a high note based on the number of establishments that were now offering legal sports betting. But then both major sporting events and their gambling facilities were closed to avoid the further spread of the Coronavirus.

“That momentum was cut short in mid-March by the COVID-19 pandemic, which required the temporary closure of all 41 of our properties,” said Jay Snowden, president and chief executive officer of Penn National Gaming. “As a result, our first quarter revenues decreased $166.5 million year-over-year, to $1.12 billion, and we incurred a net loss of $608.6 million due to $616.1 million of impairment losses.”

Despite such a major drop off in revenue for the early part of 2020, the company remains optimistic about the upcoming future.

“While we have faced unprecedented challenges in recent weeks, we are confident that the Company’s long-term growth strategy remains intact, supported by our differentiated omni-channel approach,” said Snowden. “We sincerely thank the first responders, health care workers and essential personnel around the world who are keeping us safe through this challenging time, and we hope and pray for a swift end to this unprecedented crisis.”

The Course Of Action To Stay Afloat

Penn National has come up with some new strategies to remain in business while having to stay closed.

From April through the rest of 2020, they will see an average loss of $83 million each month if all of their properties are not bringing in any money. They have reported $730.7 million on their cash sheet that is available for them to get through the pandemic losses.

“Upon the reopening of our casinos, we believe Penn National is very well-positioned to resume its positive momentum. Our geographic diversification across 19 states – with no more than 15% of our revenues being derived from any single state – should be a significant benefit as states begin to open casinos on a sequential basis,” said Snowden.

“We expect our regional gaming markets to rebound sooner than destination markets by virtue of our casinos being located in suburban areas that are more easily accessible by car from key population centers.”

Not only are they hopeful about their reopening profits, but they are also putting more into internet and mobile outlets to recoup their land-based revenue losses. Even with major sports being halted, they are finding that their Barstool Sportsbook mobile sports betting app will be able to launch by the third quarter and has created very interesting wagers for its members to participate in.

The End Game

Penn National is doing everything in their power to make sure that they will be able to beat the closures and their lack of business. Their strategies and their mobile app look to be enough to keep them open for now.

They want to assure their stakeholders that this is merely a minor setback and once everything goes back to normal, business will be booming once again.

“Penn National is the only operator in the U.S. with a large, geographically diversified land-based gaming footprint, a well-known sports brand, a fully aligned marketing partner and a wholly-owned sports betting and iCasino subsidiary,” said Snowden.

“As such, we are strongly positioned to benefit from the continuing proliferation of sports betting and iCasino legislation – something we expect to accelerate as states seek new tax revenues in the aftermath of the virus. While the last several weeks have been challenging for the Company, our team members and the entire industry, we remain firmly convinced of the long-term potential of our highly differentiated omni-channel approach.”

News tags: Barstool Sportsbook | Coronavirus | COVID-19 | Jay Snowden | Penn National Gaming