Caesars Entertainment Inc. saw its net loss increase to $352m during the first half of its financial year, despite experiencing a 615.7% year-on-year increase in revenue.
Total revenue for the six months through to June 30 amounted to $4.29bn, up from $600m in the corresponding period last year.
The large increase was due to Caesars’ casinos operating at near-full strength throughout the half. Last year, Caesars was forced to close all of its casinos from mid-March due to novel coronavirus (Covid-19) restrictions, whereas this year the properties remained open with only some measures in place.
Casino and pari-mutuel commissions proved to be the primary source of income for Caesars in the half, with revenue rocketing 534.5% to $2.80bn. Food and beverage revenue was up 28.6% to $450m, hotel revenue jumped 971.9% to $611m and other revenue hiked 1,015.4% to $435m.
Looking at segment performance, Caesar’s regional casino operations led the way with $2.68bn in revenue for the half, ahead of its Las Vegas activities on $1.35bn. A total of $125m came from the Caesars Digital business, with $127m from managed and international operations and $9m from corporate and other activities.
Turning to costs, operating expenses were 334.9% higher at $3.49bn, but the increase in revenue meant that adjusted earnings before interest, tax, depreciation and amortization (EBITDA) were up from just $1m in 2020 to $1.54bn.
However, Caesars also reported $1.20bn in other costs, the majority of which came in the form of $1.12bn in interest expenses. This left the operator with a $395m loss before tax, compared to $347m last year.
Caesars received $77m in tax benefits, which left a net loss from continuing operations of $318m, wider than $276m in 2020. When also included $34m in additional losses from its discontinued operations, this resulted in an overall net loss of $352, compared to $276m last year.
Turning to the second quarter – the period in 2020 where Caesars was most impacted by Covid-19 closures – revenue was 1,870.1% higher at $2.50bn.
Casino and pari-mutuel commissions revenue was 1,455.5% higher at $1.57bn, while food and beverage revenue increased 3,914.3% to $281m, hotel revenue 4,300.0% to $396m and other revenue 2,440.0% to $254m.
Regional revenue amounted to $1.49bn, with Las Vegas revenue at $855m, Caesars Digital revenue $86m, managed an international revenue $66m and corporate and other revenue $5m.
Operating costs hiked 828.2% to $1.91bn but the revenue hike meant adjusted EBITDA was up from a loss of $5m last year to a positive figure of $1.00bn.
Other expenses amounted to $489m, leaving a profit before tax of $101m, compared to a loss of $134m in 2020. After a $1m tax benefit, profit from continuing operations reached $102m.
After accounting for a $30m loss from discontinued operations and a $1m loss from non-controlling interests, Caesars ended the quarter with a $71m net profit, compared to a $100m loss last year.
“Our second quarter operating results improved significantly versus the first quarter of 2021 driven by continued strength in our regional markets and a dramatic improvement in results in our Las Vegas segment,” Caesar’s chief executive Tom Reeg said.
Q2 also saw Caesars complete its acquisition of British gambling operator William Hill. Under the acquisition deal announced in September last year, Caesars agreed to pay £2.9bn ($4.04bn) to take ownership of the business, purchasing William Hill’s 1.08bn shares for £2.72 apiece.
At the time, Caesars stated that the target of the acquisition was William Hill’s US betting business and technology, with the remainder of the operator’s assets, including its UK arm, now set to be sold.
Following this purchase, Caesars this week launched its new Caesars Sportsbook app.
The app, which uses the Liberty platform acquired in the William Hill deal, is already live in eight states: Colorado, Indiana, Iowa, Michigan, New Jersey, Tennessee, Virginia, and West Virginia. Caesars said it also plans to launch the app in Arizona, Maryland, and Louisiana when these markets go live.
“With the William Hill acquisition now closed, we have officially rebranded our sports betting operations to Caesars and we launched our new comprehensive marketing campaign on August 2,” Reeg said.