Reno, Nevada based Monarch Casino and Resort claims the business will be in good stead after announcing an indifferent Q3 to complete the ongoing work at its Black Hawk property.
The company, which owns and operates Atlantis Casino Resort Spa in its home market and Monarch Casino Black Hawk in Colorado, believes that the transition to a “true destination resort” will position the company for many years of growth.
In its latest financial statement, Monarch now expects the expansion project to be fully open in the first quarter of 2020, including the hotel, enlarged casino, restaurants and some public areas.
In the second quarter of 2020, the remaining remodelling of certain parts of the new casino is expected to be completed.
John Farahi, co-chairman and CEO of Monarch said: “In the near term, we expect to continue to incur pre-opening expenses, as we prepare to introduce and open what we believe will become Black Hawk’s favourite new destination resort.
“As our hotel and resort amenities open, we expect to grow the overall market as well as further expand market share, particularly as we begin to execute on what we believe will be an eighteen-month ramp-up period.
“We believe that the quality of the new Monarch Casino Resort Spa Black Hawk will offer a transformational experience for both new and returning guests.
“We expect the expansion of our Black Hawk property into a true destination resort will position Monarch to generate significant free cash flow growth over the coming years.
“Importantly, we have been able to fund over half of the spending to-date on the more than $400m Black Hawk project from operating cash flows, leaving our peak leverage levels modest and giving us a solid balance sheet that we believe will provide Monarch future flexibility to pursue additional long-term growth opportunities.”
Providing the update in its latest financial report, net revenue increased by 1.9 percent to $65.6 million (2018: $66.4 million), driven by 2 percent, and rising by 7.8 percent across the casino and hotel segments, which helped offset a slight decline in food and drink.
Over the period, net income fell 14.1 percent from $10.8 million to $9.3 million, with adjusted EBITDA finishing at $17.3 million, representing a 5.8 percent drop from $18.4 million.
Farahi commented: “Monarch’s financial performance in the third quarter of 2019 reflects continued top-line growth that was offset by higher payroll and healthcare expenses as well as expenses related to our ongoing transformation of Monarch Casino Black Hawk.”