Monarch Casino and Resort is seeking to obtain a provisional certificate for partial occupancy of their Monarch Casino Black Hawk after the business saw the COVID-19 pandemic generated major operational challenges.
In order to provide more updates when a soft opening timetable becomes clearer, Monarch, which also includes the Reno-based Atlantis Casino Resort Spa as part of its stable, has seen sales, adjusted EBITDA and a net income swing in the first two months of the year to decline for Q1 following increases.
John Farahi, Monarch’s Co-Chairman and CEO, commented: “The first quarter of 2020 was a study in contrasts, with Monarch delivering strong financial performance in the first two months of the quarter followed by a March which demonstrated the impact of the significant operational challenges created by the global spread of the COVID-19 pandemic.
“In an effort to contain the virus, on March 16th the state of Colorado mandated a temporary shutdown of all casinos including Monarch Casino Black Hawk and on March 17th the state of Nevada mandated the temporary closure of all casinos including Atlantis Casino Resort Spa in Reno. The states of Colorado and Nevada have not yet provided clear dates or guidelines for the reopening of casinos in such states.”
Revenues plummeted from $58.7 m to $51 m for the three-month period ended March 31, 2020, with casino, food and beverage and hotel revenues declining 6.6%, 16.6%, and 24.6% year-over-year, respectively.
The declines in all three categories started early in March and were triggered by the COVID-19 outbreak, resulting in a temporary closure of the company’s casinos and other Reno and Black Hawk operations.
Adjusted EBITDA dropped from $7 m a year earlier to $8.1 m (2019: $13.6 m), with net profit plummeting from $7 m a year earlier to $2.02 m (71.2%). Revenue, profit and EBITDA rose 14.2 percent, 37.6 per cent and 26.1 percent, respectively, during the same period in 2019, for the two-month period ended February 29, 2020.
Farahi added: “Since closing our properties, our main concern has been the safety and health of our team members. We are also working diligently to preserve our liquidity and to best position the company and our properties for renewed long-term success once the COVID-19 threat passes to the point where reopening will be allowed and ultimately when more ‘normal’ operations are permitted and are prudent.
“Our entire team received two weeks of regular pay after our operations were suspended and subsequently all team members not working were placed on unpaid furlough, while keeping their employee benefits. I have foregone my salary as of March 30, our board members forwent cash directors’ fees as of April 1 and our working executive management team took a salary reduction of 50 per cent.”