US land-based casino operator Full House Resorts returned to profit in the first half of its 2021 financial year after a 97.6% year-on-year increase in revenue led to a net profit of $2.0m.
Revenue for the six months to June 30 amounted to $89.7m, up from $45.4m in the same period last year, though Full House’s performance in the first half of 2020 was significantly impacted by the novel coronavirus (Covid-19) pandemic.
Last year saw Full House close its casinos for a large portion of the first half as states sought to slow the spread of Covid-19.
In contrast, casinos this year were permitted to operate throughout the half, albeit with some restrictions in place, including capacity limits and some social distancing.
This continued operations saw casino revenue more than double year-on-year from $31.7m to $66.7m, while food and beverage revenue increased by 50.0% to $13.5m, hotel revenue 74.1% to $4.7m and other operations, including online sports betting, 135.0% to $4.7m.
Turning to costs and expenses for the half reached $68.8m, up 29.8% on last year, but the rise in revenue meant adjusted earnings before interest, tax, depreciation and amortization (EBITDA) improved from a loss of $2.6m to a positive of $25.7m, while an operating loss of $7.6m turned into a $20.9m profit.
Full House incurred $18.6m in additional costs, the majority of which ($11.1m) came in the form of interest expenses, which in turn resulted in a pre-tax profit of $2.3m, up from an $11.0m loss last year.
The operator paid $284,000 in income tax, thus ending the half with a net profit of $2.0m, compared to an $11.1m loss in 2020.
In terms of its second-quarter performance, the period in which it was most impacted by the pandemic last year, revenue was 226.9% higher at $47.4m. Casino revenue was up by 214.6% to $34.6m, while food and beverage revenue hiked 270.0% to $7.4m, hotel revenue 249.1% to $2.5m and other operations revenue 237.4% to $2.8m.
Costs were 88.2% higher at $35.2m, but adjusted EBITDA improved from a loss of $1.4m in 2020 to a plus of $14.9m, while an operating loss of $4.2m was turned into a $12.2m profit.
After accounting for $6.6m in other costs, pre-tax profit reached $5.6m, compared to a loss of $6.7m last year. Full House paid $82,000 in tax, leaving a net profit for Q2 of $5.5m, up from a $6.7m loss in 2020.
“As with last quarter, our financial results continue to benefit from structural changes throughout the company,” Full House president and chief executive Daniel Lee said. “Revenues in the second quarter of 2021 increased approximately 227%, reflecting the mandated closure of our properties for much of last year’s second quarter.
“Adjusted EBITDA increased by more than $16.0m to $14.9m in the second quarter of 2021, reflecting labor and marketing improvements. For the year-to-date period, adjusted EBITDA totaled $25.7m.
“These operating results are significantly above not only the 2020 period, but also meaningfully above any second quarter or first-half results in at least the past five years.”