Penn National Gaming has announced its Q3 financial results for the period ended September 30, 2018. Among the headline figures were net revenues of $789.7m, and income from operations of $155.8m, up 8.4% year-on-year.
CEO Timothy J Wilmott updated investors, saying: “Penn National generated record third quarter income from operations, led by our Las Vegas properties and the West region overall, despite facing increased competitive pressures in Illinois and Mississippi. Our operating teams continued to execute against our margin improvement initiatives as the company drove further adjusted EBITDA margin improvements across all three operating segments by an average of 115 basis points, to 29%, with 17 of 23 gaming properties delivering improved margins.”
He continued: “On October 15, we completed our acquisition of Pinnacle Entertainment. This transformational merger further enhances Penn National’s position as North America’s leading regional gaming operator, and expands our diverse portfolio to 40 gaming, entertainment and racing properties in 18 jurisdictions, with more than five million active customers in our player rewards database.
“The acquisition is expected to be substantially accretive to Penn National’s free cash flow per share in the first year after closing, and we are expecting to achieve a run rate of more than $30m of our two-year, $100m cost synergy target by the end of the fourth quarter. We remain highly confident in our ability to realize all of our identified cost synergies, and we expect to generate new revenue synergies through leveraging one of the industry’s largest active player databases to take advantage of the continued expansion of sports wagering, iGaming, and our social gaming platform.”
On sports betting he noted: “We began taking live wagers at our Mississippi properties in August, and at Hollywood Casino at Charles Town Races in West Virginia in September. We look forward to implementing sports betting in Pennsylvania later this year, as well as real money iGaming in the first quarter on 2019. Meanwhile, as the nation’s largest regional gaming operator, we’re actively exploring strategic relationships with several sports wagering and iGaming operators as well as leading media companies and content providers.”