Q1 2024 Bally's Corp Earnings Call

Speaker Change: [music].

Operator: Good day, and welcome to the Bally's Corporation First Quarter 2024 Earnings Conference Call. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question and answer session. In order to ask a question during the session, please press the star key followed by the number one on your telephone. Please be advised that today's conference is being recorded. If you require any further assistance, please press star zero. And I'll turn the call over to Charlie Diao, Senior Vice President and Treasurer of Bally's.

Music: ?? ?? ?? ?? ?? [inaudible]

Good day and welcome to the Bally's Corporation's first quarter 2024 earnings conference call. At this time all participants are in a listen only mode. After the speaker's presentation, there will be a question.

Operator: Good day, and welcome to the Bally's Corporation First Quarter 2024 Earnings Conference Call. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question and answer session. In order to ask a question during the session, please press the star key followed by the number one on your telephone. Please be advised that today's conference is being recorded. If you require any further assistance, please press star zero. I'll now turn the call over to Charlie Diao, Senior Vice President and Treasurer of Bally's.

And answer session in order to ask a question. During this session. Please press the star key followed by the number one on your telephone. Please be advised that today's conference is being recorded if you require any further assistance. Please press star zero and I like to turn the call over to Charlie deal Senior Vice President and Treasurer for Bally's.

Charles Diao: Please go ahead Sir.

Charlie Diao: Good afternoon, and thank you for joining us on today's call. The earnings release and presentation that accompany this call are available in the investor relations section of our website at www.ballys.com. With me today are our Chief Executive Officer, Robeson Reeves, our President, George Papanier, and our Chief Financial Officer, Marcus Glover.

Charlie Diao: Good afternoon, and thank you for joining us on today's call. The earnings release and presentation that accompanied this call are available in the investor relations section of our website at www.ballys.com. With me today are our Chief Executive Officer, Robeson Reeves, our President, George Papanier, and our Chief Financial Officer, Marcus Glover.

Good afternoon, and thank you for joining us on today's call.

Charles Diao: The earnings release and presentation that accompany this call are available in the Investor Relations section of our website at Www dot.

Charles Diao: Dot com.

Charles Diao: With me today are our Chief Executive Officer, Robeson Reeves, our President George <unk>.

Charles Diao: Our Chief Financial Officer, Marcus Glover.

Charlie Diao: Before we begin, we would like to remind everyone that comments made by management today will contain forward-looking statements. These forward-looking statements include plans, expectations, estimates, and projections that involve significant risks and uncertainties. These risks are discussed in the company's earnings release and SEC filing. Financial results may differ materially from the results discussed in these forward-looking statements. In addition, during today's call, management will refer to certain non-GAAP financial measures. Reconciliations to the Most Comparable GAAP financial measures are included in the schedules contained in our earnings report.

Charlie Diao: Before we begin, we would like to remind everyone that comments made by management today will contain forward-looking statements. These forward-looking statements include plans, expectations, estimates, and projections that involve significant risks and uncertainties. These risks are discussed in the company's earnings release and SEC filing. Financial results may differ materially from the results discussed in these forward-looking statements. In addition, during today's call, management will refer to certain non-GAAP financial measures. Reconciliations to the Most Comparable GAAP financial measures are included in the schedules contained in our earnings report.

Charles Diao: Before we begin we would like to remind everyone that comments made by management today will contain forward looking statements. These forward looking statements include plans expectations estimates.

Projections that involve significant risks and uncertainties.

These risks are discussed in the company's earnings release and SEC filings.

Charles Diao: Financial results may differ materially from the results discussed in these forward looking statements.

Charles Diao: In addition during today's call.

Charles Diao: Management will refer to certain non-GAAP financial measures.

Charles Diao: Reconciliations to the most comparable GAAP financial measures are included in the schedules contained in our earnings release.

Charlie Diao: We do not provide a reconciliation of forward-looking, Non-Gap Financial Measures due to our inability to project non-recurring expenses and one-time costs. Finally, I also want to note that we will not be commenting on the special committee process during our prepared remarks or during the Q&A portion of today's call. We refer you to our news announcements from March 12th and March 28th. This call is also being broadcast live on our investors website and will be available for replay shortly after the completion of this call. But that I'm going to hand it to Robeson Reeves, our CEO.

Charlie Diao: We do not provide a reconciliation of forward-looking... Non-Gap Financial Measures due to our inability to project non-recurring expenses and one-time costs. Finally, I also want to note that we will not be commenting on the special committee process during our prepared remarks or during the Q&A portion of today's call. We refer you to our news announcements from March 12th and March 28th. This call is also being broadcast live on our investors website and will be available for replay shortly after the completion of this call. With that, I'm going to hand it to Robeson Reeves, our CEO.

Charles Diao: We do not provide a reconciliation of forward looking non.

non-GAAP financial measures due to our inability to project nonrecurring expenses and onetime costs.

Charles Diao: Finally, I also want to note that we will not be commenting on the special committee process during our prepared remarks or during the Q&A portion of today's call.

Charles Diao: We refer you to our news announcements from March 12.

Charles Diao: March 28.

Charles Diao: This call is also being broadcast live on our investors website and will be available for replay shortly after the completion of this call.

Charles Diao: With that.

Robeson Mandela Reeves: Robinson Reese our CEO.

Robeson Mandela Reeves: Thank you, Charlie. We're pleased to have you join us today to discuss Bally's solid performance in the first quarter of 2024 and to provide updates on our growth prospects going forward. First quarter revenues increased by 3% year-over-year, reaching 618 million, due to games in two of our three operational segments. Our casinos and resort segments experienced a 4% increase in revenue, and our North America Interactive segment... experienced a substantial 70% growth in revenue. The international interactive segment saw a 4% decline, however, primarily due to our operations outside the UK.

Robeson Mandela Reeves: Thank you, Charlie. We're pleased to have you join us today to discuss Bally's solid performance in the first quarter of 2024 and to provide updates on our growth prospects going forward. First quarter revenues increased by 3% year-over-year, reaching 618 million, due to games in two of our three operational segments. Our casinos and resort segments experienced a 4% increase in revenue, and our North America Interactive segment experienced a 4% increase in revenue. The international interactive segment saw a 4% decline, however, primarily due to our operations outside the UK.

Robeson Mandela Reeves: Thank you Charlie we're pleased to have you join us today to discuss Bally solid performance in the first quarter of 'twenty, four and to provide updates on our growth prospects going forward.

Robeson Mandela Reeves: First quarter revenues increased by 3% year over year, reaching $618 million.

Robeson Mandela Reeves: With games into about three operational segments.

Robeson Mandela Reeves: Our casinos and resorts segment saw a 4% increase in revenue in our North America Interactive segment experienced a substantial 17% growth in revenue.

International Interactive segment saw a 4% decline however, primarily due to our operations outside the U K.

Robeson Mandela Reeves: Notably, the UK continued to perform exceptionally well, posting a 12% increase in revenues on a US dollar basis and a 7% rise on a constant currency basis. Our proactive strategic measures in anticipation of the White Paper implementation continue to yield positive results, enhancing revenue generation and significantly boosting segment profitability. As in recent quarters, I'll start by briefly revisiting Bally's vision for the future and discussing the current status of our development pipeline. After this overview, I'll hand the call over to George and Marcus, who will provide a more detailed analysis of our performance for the quarter.

Robeson Mandela Reeves: Notably, the UK continued to perform exceptionally well, posting a 12% increase in revenues on a US dollar basis and a 7% rise on a constant currency basis. Our proactive strategic measures in anticipation of the White Paper implementation continue to yield positive results, enhancing revenue generation and significantly boosting segment profitability. As in recent quarters, I'll start by briefly revisiting Bally's vision for the future and discussing the current status of our development pipeline. After this overview, I'll hand the call over to George and Marcus, who will provide a more detailed analysis of our performance for the quarter.

Robeson Mandela Reeves: Notably the UK continued to perform exceptionally well posting a 12% increase in revenues on a us dollar basis, a 7% rise on a constant currency basis.

Robeson Mandela Reeves: Our proactive strategic measures in anticipation of the white paper implementation continued to yield positive results enhancing revenue generation and significantly boosting segment profitability.

Robeson Mandela Reeves: As in recent quarters I'll start by briefly revisiting valleys vision for the future and discussing the current status of our development pipeline.

Robeson Mandela Reeves: After this overview.

Robeson Mandela Reeves: I'll hand, the call over to George Marcus who will provide a more detailed analysis of our performance for the quarter.

Robeson Mandela Reeves: As we sit here, one quarter into 24, we believe our robust core business units and our strategically phased development pipeline position us well. Our development strategy is designed to maximize the benefits from the cash flow produced by our core operations while also enabling flexibility to adjust to potential shifts in the market. In Chicago, our temporary facility is continuing to ramp up, offering us a valuable opportunity to build and nurture relationships with customers, as well as gain insights into the market.

Robeson Mandela Reeves: As we sit here, one quarter into 24, we believe our robust core business units and our strategically phased development pipeline position us well. Our development strategy is designed to maximize the benefits from the cash flow produced by our core operations while also enabling flexibility to adjust to potential shifts in the market. In Chicago, our temporary facility is continuing to ramp up, offering us a valuable opportunity to build and nurture relationships with customers, as well as gain insights into the market.

George Marcus: As we sit here one quarter into 'twenty full we believe our robust core business units and are strategically phased development pipeline positions us well.

George Marcus: Our development strategy is designed to optimize the benefits from the cash flow produced by our cooperations.

George Marcus: We're also enabling flexibility to adjust to potential shifts in the market.

George Marcus: In Chicago, our temporary facilities, continuing to ramp up offering us a valuable opportunity to build a notch relationships with customers as well as gain insights into the market.

George Marcus: This intelligence will prove beneficial to our continued operations at the temporary facility and extend into the opening of the permanent casino.

Robeson Mandela Reeves: This intelligence will prove beneficial to our continued operations at the temporary facility and extend into the opening of the permanent casino. We are on schedule to access the River North campus in July, and we continue to expect to complete the permanent casino by September 26. In Las Vegas, we closed the Tropicana on April 2nd and are preparing the property for demolition. Having recently received receipt of the necessary permits, we expect to demolish the Tropicana in October.

Robeson Mandela Reeves: This intelligence will prove beneficial to our continued operations at the temporary facility and extend into the opening of the permanent casino. We are on schedule to access the River North campus in July, and we continue to expect to complete the permanent casino by September 26. In Las Vegas, we closed the Tropicana on April 2nd and are preparing the property for demolition. Having recently received receipt of the necessary permits, we expect to demolish the Tropicana in October.

George Marcus: We are on schedule to access the river North campus in July and we continue to expect to complete the permanent casino by September 26.

In Las Vegas, we closed the Tropicana on April 2nd preparing the proxy for demolition.

George Marcus: Having recently received receipt of the necessary comments, we expect to demolish the Tropicana in October.

Robeson Mandela Reeves: This step is crucial for keeping to our expected timeline, which includes the Las Vegas A's starting construction of their new stadium in the second half of 2025. Simultaneously, we are actively assessing our options for the highly valuable land next to the stadium and will provide updates as our plans further develop. In New York, the licensing and approval process is extending further, and we now anticipate a decision from the state no earlier than late 2025. While this delay will postpone the economic benefits from the planned integrated resort into the future, it also reduces our immediate and medium-term financing needs.

Robeson Mandela Reeves: This step is crucial for keeping to our expected timeline, which includes the Las Vegas A's starting construction of their new stadium in the second half of 2025. Simultaneously, we are actively assessing our options for the highly valuable land next to the stadium and will provide updates as our plans further develop. In New York, the licensing and approval process is extending further, and we now anticipate a decision from the state no earlier than late 2025. While this delay will postpone the economic benefits from the planned integrated resort into the future, it also reduces our immediate and medium-term financing needs.

George Marcus: This step is crucial for keeping to our expected timeline, which includes Las Vegas, a starting construction of the new stadium in the second half of 'twenty five simultaneously. We are actively assessing our options for the highly valuable land next to the stadium and we'll provide updates as our plans further dip.

George Marcus: <unk>.

George Marcus: In New York, the licensing and approval process is extending further.

George Marcus: Now anticipate a decision from the states no earlier than late 'twenty five.

George Marcus: While this delay will price upon the economic benefits from the planned integrated resort later into the future. It also reduces our immediate and medium term financing needs.

Robeson Mandela Reeves: Finally, I'll turn my attention from property development to our interactive segment. In our international interactive segment, the UK continues to be our most robust market. Our success is largely due to proactive strategic planning ahead of the White Paper implementation, along with enhanced acquisition efficiency and refined marketing strategy. Segment has also benefited from our strategic reorganization and diligent cost management efforts. We are actively exploring additional ways to expand our presence in the UK and will soon launch online sports betting to further strengthen our market-leading position and serve as a player acquisition funnel.

Robeson Mandela Reeves: Finally, I'll turn my attention from property development to our interactive segment. In our international interactive segment, the UK continues to be our most robust market. Our success is largely due to proactive strategic planning ahead of the White Paper implementation, along with enhanced acquisition efficiency and refined marketing strategy. The segment has also benefited from our strategic reorganization and diligent cost management efforts. We are actively exploring additional ways to expand our presence in the UK and will soon launch online sports betting to further strengthen our market leading position and serve as a player acquisition funnel.

George Marcus: Finally, I'll turn my attention from property development to our interactive segments.

George Marcus: International Interactive segment, the UK continues to be a low stroke best market.

George Marcus: Our success is largely due to proactive strategic planning ahead of the white paper instrumentation, along with enhanced acquisition efficiency and refined marketing strategies.

George Marcus: Segment has also benefited from our strategic reorganization and diligent cost management efforts.

George Marcus: We are actively exploring additional ways to expand their presence in the UK and will soon launch online sports betting to further strengthen our market leading position.

George Marcus: The supplier acquisition funnel.

Robeson Mandela Reeves: Outside of the UK, we strategically shifted focus to maximize profit yield by pulling back on uneconomic marketing and cost structure reduction. This impacted our year-over-year top-line comparisons but benefited our adjusted EBITDA margin significantly. In Asia, although the market has shown some variability, there are signs that it's beginning to stabilize, which we view as a critical step for business growth. In Europe, we anticipate benefits from the recent lifting of advertising restrictions in Spain, which we believe will provide a significant boost as the year progresses.

Robeson Mandela Reeves: Outside of the UK, we strategically shifted focus to maximize profit yield by pulling back on uneconomic marketing and cost structure reduction. This impacted our year-over-year top-line comparisons, which benefited our adjusted EBITDA margin significantly. In Asia, although the market has shown some variability, there are signs that it's beginning to stabilize, which we view as a critical step for business growth. In Europe, we anticipate benefits from the recent lifting of advertising restrictions in Spain, which we believe will provide a significant boost as the year progresses.

George Marcus: Outside of the U K, we strategically shifted focus to maximize profit yield by pulling back on an economic marketing and cost structure reductions.

This impacted our year over year top line comparisons with benefits at our adjusted EBITDA margin significantly.

In Asia, although the market has shown some variability there are signs that it is beginning to stabilize which we view as a critical step for business growth.

George Marcus: In Europe, we anticipate benefits from the recent lifting of advertising restrictions in Spain, which we believe will provide a significant pace as the year progresses.

Robeson Mandela Reeves: Finally, with respect to Brazil, we remain very focused on the market and expect to provide more updates in the near future. The North American interactive segment delivered a very strong quarter as we continue to capture an incremental large share of the iGaming market in New Jersey and Pennsylvania. Additionally, in March, we successfully launched iGaming in Rhode Island as a sole provider. In just under a month of operation, we generated $1.2 million in gross gaming revenue, and we've observed an accelerating pace of revenue generation thus far in eight. We also successfully continued the rollout of our BallyBet online sports betting in the United States, which, as we've mentioned many times before, we view as a funnel for iG

Robeson Mandela Reeves: Finally, with respect to Brazil, we remain very focused on the market and expect to provide more updates in the near future. The North American interactive segment delivered a very strong quarter as we continue to capture an incremental large share of the iGaming market in New Jersey and Pennsylvania. Additionally, in March, we successfully launched iGaming in Rhode Island as a sole provider. In just under a month of operation, we generated $1.2 million in gross gaming revenue, and we've observed an accelerating pace of revenue generation thus far in April.

George Marcus: Finally, with respect to Brazil, we remain very focused in the market and expect to provide more updates in the near future.

George Marcus: Our North American Interactive segment delivered a very strong quarter as we continued to capture incremental large share of the gaming market in New Jersey, Pennsylvania.

George Marcus: Additionally in March we successfully launched <unk> in Rhode Island.

George Marcus: Island as the sole provider.

George Marcus: And just under a month of operation, we generated $1 2 million and gross gaming revenue.

George Marcus: Accelerating pace revenue generation, thus far in April.

Robeson Mandela Reeves: We also successfully continued the rollout of our BallyBet online sports betting in the United States, which, as we've mentioned many times before, we view as a funnel for iGaming growth. We are very pleased with our transition onto the Canby and White Hat platforms and believe this transition has been well received by our customers. The results and our continued ability to gain market share clearly demonstrate that our players are recognising the benefits of this technological transition.

George Marcus: We also successfully continued the rollout fully back online sports betting in the United States, which as we've mentioned many times before we view as a funnel for I gaming Greg.

Robeson Mandela Reeves: We are very pleased with our transition onto the Canby and White Hat platforms and believe this transition has been well received by our customers. The results and our continued ability to gain market share clearly demonstrate that our players are recognising the benefits of this technological transition. Additionally, it's important to note that our North American Interactive Segment is expected to incur an adjusted EBITDA loss of about $30 million in 2024. However, we anticipate that this loss will decrease in a non-linear fashion as the year progresses. With that, I'll now pass the discussion to George for further details on our operational performance over the last quarter.

George Marcus: We are very pleased with that transition onto the camby in whiteout platforms and believe this transition has been well received by our customers.

George Marcus: The results and our continued ability to gain market share clearly demonstrate that our plans are recognizing the benefits of this technological transition.

Robeson Mandela Reeves: Additionally, it's important to note that our North American interactive segment is expected to incur an adjusted EBITDA loss of about $30 million in 2024. However, we anticipate that this loss will decrease in a non-linear fashion as the year progresses. With that, I'll now pass the discussion to George for further details on our operational performance over the last quarter.

George Marcus: Additionally, it is important to note that our North American Interactive segment is expected to incur an adjusted EBITDA loss of about $30 million 24.

George Marcus: However, we anticipate that this loss will decrease in a normal linear fashion as the year progresses.

George Marcus: With that I'll now pass the discussion to George.

George Marcus: The details on our operational performance over the last quarter.

George Marcus: Thanks Robison.

George T. Papanier: I'll begin my remarks by providing operating insights into our casinos and resorts segments of performance. Following that, I'll dive into the latest developments at our Chicago Temporary Facility and our ongoing efforts to build on its results. The casino resort segment delivered strong top-line performance, revenue growth of 4.1%.

George T. Papanier: I'll begin my remarks by providing operating insights into our casinos and resorts segments performance. Following that, I'll dive into the latest developments at our Chicago Temporary Facility and our ongoing efforts to build on its results. The casino-resort segment delivered strong top-line performance, revenue growth of 4.1%.

George Marcus: I'll begin my remarks by providing operating insights into our casinos and resorts segment performance.

Following that I'll dive into the latest developments at our Chicago temporary facility and our ongoing efforts to build on its results.

George Marcus: Our casino resorts segment delivered strong top line performance revenue growth of four 1%.

George T. Papanier: Growth was driven by a full quarter of operations at the Chicago Temporary Facility, which helped offset the wind-down of the Tropicana. We also navigated a few challenges during the quarter, which we believe to be temporary. As we mentioned on our fourth-quarter call and as has been widely reported, adverse weather in January significantly impacted our results. Fortunately, we saw a recovery in February and March as conditions returned to more normalized seasonal trends.

George T. Papanier: Growth was driven by a full quarter of operations at the Chicago Temporary Facility, which helped offset the wind-down of the Tropicana. We also navigated a few challenges during the quarter, which we believe to be temporary. As we mentioned on our fourth-quarter call and as has been widely reported, adverse weather in January significantly impacted our results. Fortunately, we saw a recovery in February and March as conditions returned to more normalized seasonal trends.

George Marcus: This growth was driven by a full quarter of operations at the Chicago temporary facility, which helped offset the wind down of the Tropicana.

George Marcus: We all also navigated a few challenges during the quarter, which we believe to be temporary.

George Marcus: As we mentioned on our fourth quarter call and has been widely reported adverse weather in January significantly impacted our results.

George Marcus: Fortunately, we saw a recovery in February and March as conditions return to more normalized seasonal trends.

George T. Papanier: Additionally, visitation to our Rhode Island properties was notably affected by construction on the Providence Bridge on Interstate 195, a critical north-south route connecting Rhode Island to Massachusetts. Additionally, one of the two bridges has suffered structural issues, leading to lane closures that disrupt traffic during peak periods.

George T. Papanier: Additionally, visitation to our Rhode Island properties was notably affected by construction on the Providence Bridge on Interstate 195, a critical north-south route connecting Rhode Island to Massachusetts. Additionally, one of the two bridges has suffered structural issues, leading to lane closures that disrupt traffic during peak periods.

George Marcus: <unk> visitation to our Rhode Island properties was notably affected by construction on the Providence Bridge on Interstate 95 critical North South route connecting Rhode Island, Massachusetts, one of the two bridges has suffered structural issues leading to lane closures that <unk>.

George Marcus: Abrupt traffic during peak periods.

George T. Papanier: Unfortunately, there is no immediate solution, and the disruptions are expected to continue. However, despite the weather challenges that impacted our margins this quarter, our underlying operating trends continue to be strong. We observed stable trends across the customer database and properties. We expect improvements to continue as the year progresses since these impacts are largely temporary. We must manage the effects of wage pressures from the recent union contract, but we do not anticipate other major challenges.

George T. Papanier: Unfortunately, there is no immediate solution, and the disruptions are expected to continue. However, despite the weather challenges that impacted our margins this quarter, our underlying operating trends continue to be strong. Currently, aside from weather-related disruptions, we observe stable trends across the customer database and properties. We expect improvements to continue as the year progresses since these impacts are largely temporary. We must manage the effects of wage pressures from the recent union contract, but we do not anticipate other major challenges.

George Marcus: Fortunately there is no immediate solution and the disruptions are expected to continue.

Despite the weather challenges that impacted our margins this quarter.

George Marcus: Underlying operating trends continue to be strong.

George Marcus: Encouragingly side from weather related disruptions, we observed stable trends across the customer database and properties.

George Marcus: Expect improvements to continue as the year progresses since these impacts are largely temporary.

George Marcus: We must manage the effects of wage pressures from recent union contract renewals, but we do not anticipate other major challenges. Additionally, we are actively exploring opportunities to better leverage the synergies within our 16 property portfolio. We're excited for what the remainder of the year has in store.

George T. Papanier: Additionally, we are actively exploring opportunities to better leverage the synergies within our 16-property portfolio, and we are excited for what the remainder of the year has to offer. Moving on to Chicago. We continue to ramp up activities at the temporary facility and expand our customer database. During March, the temporary facility generated GGR of over $13 million, which represented a greater than 50% increase compared to December. Admissions also rose to approximately 118,000 versus 100,000 in December, and we ended the quarter with over 80,000 new Bally Region Awards members, up from 60,000 at year-end.

George T. Papanier: Additionally, we are actively exploring opportunities to better leverage the synergies within our 16-property portfolio, and we are excited for what the remainder of the year has to offer. Moving on to Chicago. We continue to ramp up activities at the temporary facility and expand our customer database. During March, the temporary facility generated GGR of over $13 million, which represented a greater than 50% increase compared to December. Emissions also rose to approximately 118,000 versus 100,000 in December, and we ended the quarter with over 80,000 new Bally Regional Awards members, up from 60,000 at year-end.

George Marcus: Moving on tissue cargo.

George Marcus: Continue to ramp up activities at the temporary facility and expand our customer database.

George Marcus: During March the temporary facility generated <unk> of over $13 million, which represented a greater than 50% increase compared to December.

George Marcus: Emissions also rose to approximately 118000 versus 100000 in December and we ended the quarter with over 80000, New Valley words members up from 60000 at year end.

George T. Papanier: Each day, our team gains a deeper understanding of our customers, and we are already using this knowledge to enhance the performance of the temporary facility, which will also benefit the permanent facility once it opens. Improvements in parking continue, with a valet service set to launch soon.

George T. Papanier: Each day, our team gains a deeper understanding of our customers. We are already using this knowledge to enhance the performance of the temporary facility, which will also benefit the permanent facility once it opens. Improvements in parking continue, with valet service set to launch soon. Additionally, we're adding more VIP options and actively seeking partnerships with local dining establishments and outlets to integrate Bally's comp currency, enriching our guests' rewards beyond just rewards.

George Marcus: Each day, our team gained a deeper understanding of our customers.

George Marcus: Already using this knowledge to enhance the performance of the temporary facility, which will also benefit the permanent facility once it opens.

George Marcus: Improvements in parking continue with Valley service set to launch soon.

George Papanier: Additionally, we're adding more VIP options and actively seeking partnerships with local dining establishments and outlets to integrate Bally's comp currency. Therefore, by enriching our guests' rewards beyond just free, We anticipate beginning to hit normalized revenue production rates as we head into the spring and summer months, focus on gradually improving profitability over time. As Robeson noted earlier, we're on track to gain control of the North River Campus in July and will commence site preparation and demolition shortly thereafter. We remain confident that the property will be operational by September 2026. As all timelines are currently on schedule. As a reminder.

George Marcus: Additionally, we're adding more VIP options and actively seeking partnerships local dining establishments and outlets to integrate valleys comp currency.

George Marcus: Therefore by enriching our guests rewards beyond just replay.

George T. Papanier: We anticipate beginning to hit normalized revenue production rates as we head into the spring and summer months and focus on gradually improving profitability over time. As Robeson noted earlier, we're on track to gain control of the North River Campus in July and will commence site preparation and demolition shortly thereafter. We remain confident that the property will be operational by September 2026, as all timelines are currently on schedule, as a reminder. There are approximately $1.1 billion in hard construction costs remaining under the host community agreement.

George Marcus: We anticipate beginning to hit normalized revenue production rates as we head into the spring and summer months, and we will focus on gradually improving profitability over time.

George Marcus: As <unk> noted earlier, we are on track to gain control of the North River campus in July and will commence site preparation and demolition. Shortly thereafter, we remain confident that the property will be operational by September 2026.

George Marcus: As all timelines are currently on schedule.

George Marcus: As a reminder.

George Marcus: There are approximately $1 1 billion in hard construction cost remaining under the host community agreement with the majority of these costs are expected to be incurred in 2025 and 2026.

George T. Papanier: The majority of these costs are expected to be incurred in 2025 and 2026. Returning to Las Vegas. The Tropicana officially closed on April 2nd, and we're currently preparing the building for demolition later this year. This will allow the Las Vegas A's to begin their stadium development and keep pace with their plans to play at the new big Las Vegas stadium, beginning with the 2028 Major League Baseball season. While working with the team, we continue to evaluate our development options for the remainder of the 36-acre site, that Now, let me turn the call over to you.

George Marcus: Turning to Las Vegas.

George Marcus: Tropicana officially closed on April 2nd we're currently preparing to building for demolition later this year. This will allow the Las Vegas as to begin their stadium development and keep pace with their plans to play at the New date Las Vegas Stadium, beginning with the 2028 Major League baseball season.

George Marcus: We're working with the team we continue to evaluate our development options for the remainder of the 36 acre site.

George Marcus: With that now let me turn the call over to Martin.

Marcus Glover: George, as Robeson and George highlighted, our core results demonstrate we saw a solid start to 2024 in the first quarter. First quarter revenues on a consolidated basis increased by 3% year-on-year to $618 million, with gains in two of our three operating segments. Revenue for our casino and resort segment rose to $342.3 million, up 4.1%, as performance in February and March somewhat mitigated the adverse impact of January's severe winter weather. Other challenges during the quarter included low hold in several markets, construction on a major artery interrupting access to our properties in Rhode Island, and the winding down of operations at the Tropicana.

Martin: Thanks, George as ropes and George highlighted our core results demonstrate we saw a solid start to 2024 and the first quarter.

Marcus Glover: Adjusted EBITDA for this segment was $89.4 million, a 15% decrease from the previous year, primarily due to the negative impacts from the January weather and the aforementioned issues. As George mentioned just a few moments ago, we expect margins to return to more normalized levels as our core portfolio remains strong. Excluding Atlantic City, the Chicago Temp, and the Tropicana, adjusted EBITDA margins were 35%, including the January weather effects, giving us confidence for the remainder of, With that said, we continually look to improve performance and enhance profitability as we strategically integrate our portfolio of properties as our company, International Interactive revenues declined by 4% year-over-year to $235 million, primarily due to our strategic reduction in marketing outside of the UK, which affected our year-over-year top-line comparison. This decision is part of our broader effort to optimize marketing investments and cost structure, enhancing profitability. A Strategy That Is Proving Effective.

Martin: First quarter revenues on a consolidated basis increased by 3% year on year to $618 million with gains in two of our three operating segments.

Martin: Revenue for our casino and resort segment rose to $342 3 million up four 1% as performance in February and March somewhat mitigated the adverse impact of January severe winter weather.

Martin: Other challenges during the quarter included low hold in several markets construction on our major audrie interrupting access to our properties in Rhode Island, and the winding down of operations at the Tropicana.

Martin: Adjusted EBITDA for this segment was $89 4, million% to 15% decrease from the previous year, primarily due to the negative impacts from the January weather and the aforementioned issues.

Martin: As George mentioned, just a few moments ago, we expect margins to return to more normalized levels as our core portfolio remains strong.

Martin: Excluding Atlantic City, the Chicago, and the Tropicana adjusted EBITDA margins were 35%, including the January weather effects, giving us confidence for the remainder of the year.

Martin: But that said, we continually look to improve performance and enhance profitability as we strategically integrate our portfolio of properties as our company matures.

Martin: International Interactive revenues declined by 4% year over year to $235 million, primarily due to our strategic reduction in marketing outside of the U K, which affected our year over year top line comparisons.

Martin: This decision is part of our broader effort to optimize marketing investments and cost structure enhancing profitability.

Martin: A strategy that is proving effective.

Marcus Glover: In contrast, our UK operations, the crown jewel within our international segments, continue to perform strongly, with revenues increasing by 12% year-over-year in US dollars and 7% in constant currency. Overall, our strategic choices and robust results in the UK drove our adjusted EBITDA up to $84 million for International Interactive, a year-over-year increase of 4%. This growth was further supported by a significant enhancement in our adjusted EBITDA margin, which climbed approximately 290 basis points to 36%.

Martin: In contrast, our U K operations, the Crown jewel within our international segments continued to perform strongly with revenues increasing by 12% year over year in U S dollars and 7% in constant currency.

Martin: Overall, our strategic choices and robust results in the UK drove our adjusted EBITDAR up to $84 million for international interactive a year over year increase of 4%.

Martin: This growth was further supported by a significant enhancement in our adjusted EBITDA margin, which climbed approximately 290 basis points to 36%.

Yeah.

Marcus Glover: North America Interactive generated revenue of $41.5 million, a 70% year-over-year improvement. The segment generated an adjusted EBITDA loss of $10.2 million as we launched iGaming in Rhode Island late in the quarter, which is off to a quite a great start. We continue to believe that losses for North American Interactive overall will narrow as the year progresses, driven by our strong iGaming operations in New Jersey, Pennsylvania, and now Rhode Island, in addition to the growth of our BallyBet online sports betting app.

Martin: North America interactive generated revenue of $41 5, million% to 70% year over year improvement.

Martin: The segment generated an adjusted EBITDA loss of $10 2 million as we launched I gaming in Rhode Island late in the quarter, which is off to a quite great start.

Martin: We continue to believe that losses for North America Interactive overall overall will narrow as the year progresses, driven by our strong gaming operations in New Jersey, Pennsylvania, and now Rhode Island. In addition to the scaling of our Valley bet.

Martin: Online sports betting app.

Marcus Glover: Turning to our capital structure, at the end of the quarter, shares outstanding were approximately $40 million. We also have incremental warrants, options, and other dilution of approximately 13 million shares. We ended the quarter with $169 million of cash on our balance sheet and $3.57 billion of net debt. Shifting to guidance, we are reiterating the 2024 guidance we laid out on our fourth-quarter call in February. We continue to expect to generate 2024 revenue in a range of $2.5 billion to $2.7 billion, and 24 Adjusted EBITDA of $655 million to $695 million.

Martin: Turning to our capital structure at the end of the quarter shares outstanding were approximately $40 million.

Martin: We also have incremental warrants options and other dilution of approximately 13 million shares.

We ended the quarter with $169 million of cash on our balance sheet and $3 $5 7 billion of net debt.

Martin: Shifting to guidance, we are reiterating the 2020 forward guidance, we laid out on our fourth quarter call in February.

Martin: We continue to expect to generate 2020 for revenue in a range of $2 5 billion to $2 7 billion and 24, adjusted EBITDAR of $655 million to $695 million.

Marcus Glover: The guidance reflects the closure of Tropicana on April 2nd, continued growth in the international interactive business, and approximately 30 million of adjusted EBITDA losses in North America Interactive. In conclusion, we remain very excited by the roadmap and executing the opportunities in front of us in 2014. As we approach the summer, we will soon launch sports betting in the UK, and our entire team is excited to take over the River North campus in early July to begin preparation for construction of the permanent, We will now open the call for questions and answers. Operator. Thank you, sir. At this time, if you would like to

The guidance reflects the closure of Tropicana on April 2nd continued growth in the international interactive business and approximately $30 million of adjusted EBITDA losses in North America Interactive.

Martin: In conclusion, we remain very excited by the roadmap and executing the opportunities in front of us in 'twenty four.

Martin: As we approach the summer we will soon launch sports betting in the U K and our entire team is excited to take over the river North campus in early July to began preparation for construction of the permanent casino.

Speaker Change: We will now open the call for questions and answers operator.

Operator: Thank you, sir. At this time, if you would like to ask a question, please press star and one on your telephone keypad. You may remove yourself from the queue at any time by pressing star two. Once again, that is star one to ask a question. We will pause for a moment to allow questions to queue. Our first question comes from Barry Jonas with Truist.

Speaker Change: Thank you Sir at this time, if you would like to ask a question. Please press the star and one on your telephone keypad you may remove yourself from the queue at any time by pressing star to once again that is star one to ask a question, we'll pause for a moment to allow questions to queue.

Speaker Change: Our first question comes from Barry Jonas with Truest.

Barry Jonathan Jonas: Hey guys, wanted to start with international, maybe specifically the crown jewel. Do you think the growth and also the share gains you're seeing in the UK are sustainable? And then, I guess, as a follow-up, I wanted to touch on Spain with these restrictions being removed. How meaningful do you think Spain could be for Bally? Thanks.

Barry Jonathan Jonas: Hey, guys.

Barry Jonathan Jonas: Wanted to start with international maybe quickly the crown jewel.

Barry Jonathan Jonas: Do you think the growth and also the share gains you're seeing in the U K are sustainable and then I guess as a follow up I wanted to touch on Spain with these restrictions being removed how meaningful do you think seeing could be for valley.

Operator: Hey, hey, hey, Barry. Thanks for the question. Robeson, he's straight out of Central Casting for being able to answer that one.

Speaker Change: Hey, Barry Thanks for the question.

Speaker Change: Rolfson ropes and I'll handle that he's straight out of central casting for being able to answer that one.

Speaker Change: Okay.

Robeson Mandela Reeves: Yeah, so UK performance, yeah, very solid, very consistent, we've got excellent customer attention, so all the KPIs are high for customer attention with record active levels, we're getting excellent quality acquisition of volume, and we've seen improved KPIs as well, driven by our brand campaigns that we've delivered on Virgin. We just launched further brand campaigns with Bally's to drive further awareness, and it's already doing well. So we've got a lot more tools in the locker to continue to grow and drive performance there. Adding sports will be material as well, and as some of you may have seen, the white paper consultations were released by the Gambling Commission today.

Speaker Change: <unk>.

Rolfson: Yes, so UK performance, yet very solid very consistent we've got excellent customer attention. So it will look kpis of high customer attention with record active levels.

Rolfson: We're getting excellent quality acquisition volume.

Rolfson: And we've seen improved kpis as well driven by our brand campaigns that we've delivered on Virginia, We just launched actually.

Rolfson: Further brand campaigns with ollie's to drive further awareness and it's already doing well. So we've got a lot more tools in the market to continue to grow and drive performance there.

Rolfson: Adding sports will be material as well.

Rolfson: Some of you would have seen.

Rolfson: Yes.

Rolfson: White paper consultations were released by the government Commission to that.

Robeson Mandela Reeves: Firstly, I wanted to say the UK Gambling Commission has done a great job and has worked well with the industry. They've listened to all operators, and they're doing the right thing for players, and this will be a good long-term environment for great operators to exist in. I'm delighted that it's been released. What I've said before on this topic still remains true. The larger, high-quality operators will continue to gain share, and it will get more and more difficult for the smaller operators.

Rolfson: Firstly I wanted to say they have done a great job with the UK Government Commission.

Rolfson: With the industry.

Rolfson: Listen to all operators are not doing the right thing for players.

Rolfson: This will be a good long term.

Rolfson: Environment for great operators to exist.

Rolfson: But it has been released.

Rolfson: <unk> said before on this topic is still remains true.

Rolfson: Larger.

Rolfson: High quality operators will continue to gain share and it will get more and more difficult for the smaller operators I am very happy with where the UK is I see a lot.

Robeson Mandela Reeves: I'm very happy with where the UK is. I see a lot more that we can unlock there. Yes, delighted to see that the ad decree has largely been reversed. That means that we will spend in the market, we'll stick to our normal formulas, exacting formulas, so we'll spend in a highly optimized fashion, we'll deliver growth, but we'll also drive EBITDA margins in any case.

Rolfson: Lots more that we can unlock that.

Speaker Change: I'll jump on to Spain.

Speaker Change: Yes delighted to see that.

Speaker Change: At the Cree, Latvia has been robust.

Speaker Change: That means that we will spend in the market.

Speaker Change: Stick to our normal formulas exacting formula So we will spend in a highly optimized fashion will deliver growth, but will also drive EBITDA margins.

Robeson Mandela Reeves: So yeah, very positive with Spain, very positive with the UK, see good upside there. Did you ask about Rhode Island as well, or not? No? No? Okay.

Speaker Change: Yes.

Speaker Change: So, yes, very positive with Spain, the UK see good upside there.

Speaker Change: Did you ask about Rhode Island, as well or not.

Speaker Change: Okay.

Barry Jonathan Jonas: Well, I guess that's a fair follow-up. I was sort of curious what you're seeing, if you could give more color, what you're seeing with the Providence bridge work and maybe just an interactive angle. Is there a chance you could maybe offset some of that with iGaming in the state? Thanks.

Speaker Change: Yes, that's a fair a follow up I was sort of curious.

Speaker Change: What youre seeing if you can give more color on what youre seeing with the Providence Bridge work and May be just an interactive angle is there a chance you could maybe offset some of that with.

Speaker Change: With I gaming in the state.

Robeson Mandela Reeves: I think George can comment on the bridge, and then I'll give you a bit of color on it.

Speaker Change: I think George can comment on the bridge and then I'll give you a bit of color.

George Marcus: Hey, Barry.

George T. Papanier: Yeah, we're definitely seeing an impact, primarily during peak periods, but not material at this time. And we're obviously mitigating any impact, primarily in our variable expense and, you know, geared towards any customer volume.

George Marcus: Seeing definitely see an impact.

Primarily during peak periods, but not material at this time.

George Marcus: And we're obviously mitigating any impact.

George Marcus: Primarily in our variable expenses.

George Marcus: Towards any customer volumes.

Robeson Mandela Reeves: And I guess we've always viewed iGaming and Bricks and Mortar as complementary products which sit alongside each other. What we've seen so far, I'm pleased. The launch in March in Rhode Island, as you know, generated in excess of a million dollars in GGR. The trends that we're seeing are very good, and we've seen great growth actually through April. Good opportunities to offset some negative impacts that you sometimes get with weather and other adverse effects on bricks and mortar.

And.

I guess, we've always viewed gaming in bricks and mortar as complementary products, which sit alongside each other.

George Marcus: What we've seen so far I'm pleased with the launch in March and Rhode Island.

George Marcus: As you know generated.

George Marcus: <unk> million dollars GTR.

George Marcus: The trends that we're seeing are very good and we've seen great growth actually through April.

George Marcus: We've got a lot of confidence in the Rhode Island market and we think it's going to be material from a North America Oi gaming revenue generation perspective, and we will give.

George Marcus: Good opportunities to offset some negative impacts that you, sometimes get with weather and other adverse effects.

George Marcus: With bricks and mortar.

Operator: Got it. All right. Thank you so much.

Speaker Change: Got it alright, thank you so much.

Speaker Change: Yeah.

Speaker Change: Thank you Bart.

David Brian Katz: Our next question comes from David Katz with Jeffrey Stantial.

Speaker Change: Our next question comes from David Katz with Jefferies.

Operator: Afternoon, everyone. Thanks for taking my questions. I wanted to ask about the North American interactive business and just get a little bit of a qualitative, longer-term vision on it. Where can we realistically expect that business to evolve to over some two-, three-year period? Particularly on the heels, Robeson, of your comments about other markets where it's hard to be smaller and sort of catch up.

David Brian Katz: Afternoon, everyone. Thanks for taking my questions I wanted to ask about the North American interactive business.

David Brian Katz: And just get a little bit of a qualitative longer term vision on it.

David Brian Katz: Can we realistically expect that business to evolve too.

David Brian Katz: Over some too.

David Brian Katz: Two three year period, particularly on the heels.

David Brian Katz: <unk> of your comments about.

David Brian Katz: Other markets, where it's hard to be smaller and sort of catch up.

Marcus Glover: David, I'll start and then Robeson can clean up on it. We've always stated, you know, especially last year, if you recall, when we repositioned and went to the variable kind of cost model and the can be white hat relationship, we kind of, at that point, repositioned our approach on the OSB side, where we said we want to have a quality product and quality offering, we want to be available in states, but it was really just a means to an iGaming outcome.

David Brian Katz: David I'll start and then ropes and come back clean up on it.

We've always stated.

David Brian Katz: Especially last year, if you recall when we repositioned and went to the variable cost model can be why that relationship.

David Brian Katz: We kind of at that point or reposition our approach on this OSB side, where we said we want to have a quality product and quality offering we want to be available in the states, but it was really as a means to an I gaming outcome.

Marcus Glover: And so we believe that our future for North America Interactive lies on the strength of iGaming performance. So far, obviously, we're in New Jersey, Pennsylvania, now Rhode Island, and we're seeing some great promise in Rhode Island. But we are very, very prudent with how we're approaching our positioning with OSB from a reinvestment standpoint. We want to, again, have a competitive offering, but we'll be very measured with how much reinvestment we actually put on the sports side of things. I'll let Robeson give any additional color that he may have on that, but just wanted to tease it up with that initial intro.

David Brian Katz: And so we believe that our future for North America Interactive lies on the strength of our gaming performance so far obviously.

David Brian Katz: Jersey, Pennsylvania, now recently, Rhode Island, and we're seeing some great promise in Rhode Island, but we are very very prudent with how we are approaching our positioning with OSB from a reinvestment standpoint.

Speaker Change: Once again have a competitive offering but will be very measured with how much reinvestment, we actually put on the sports side of things I'll, let <unk> give any additional color that he may have on that but just wanted to tee it up with that initial intro, yes. So as Marco said, we're focusing our investment in the I gaming sites or what might be.

Robeson Mandela Reeves: Yeah, so as Marcus said, we're focusing our investment in the iGaming states, or what might become iGaming states in the future. We haven't made any assumptions around additional states kicking in, so we're making sure our cost base aligns to that. I would say the big difference between the UK market and the North America market, whereby in the UK, much more of the operation, because of the regulations, requires manpower and human intervention 24-7.

<unk> gaming in the future, we havent made any assumptions around additional states kicking in so we're making sure our cost base aligned to that.

Speaker Change: Would say the big difference between the UK market in the North America.

Speaker Change: Market.

Speaker Change: Whereby in the UK much more of the operation.

Speaker Change: The regulations require some manpower human intervention $24 seven.

Robeson Mandela Reeves: That, by definition, just means that you need to be much more of a scaled player. Our cost base, as Marcus indicated, we've gone for a variable cost structure at our existing scale, but also, there's lower human overhead required for North America as would a, call it, a UK business. It's just different types of regulation.

Speaker Change: That just by definition just means that you need to be much more of a scale player.

Speaker Change: Our cost base as Mark has indicated we come from a variable cost structure at our existing scale.

Speaker Change: But also.

Speaker Change: This lower human overhead required.

Speaker Change: For North America as well.

Speaker Change: U K business is just different different designs of regulations.

David Brian Katz: And David, just as a reminder, we've always stated, and we continue to state, we haven't seen anything that gives us pause on what we've stated publicly in terms of migrating toward a negative $30 million loss for 24. We haven't provided any kind of guidance beyond that in terms of where we think the business will get from a financial performance beyond 24, obviously better than where we finished. Ideally, we'd love to get that business from negative 30 to zero and then eventually positive.

Matt: David This is Matt.

Matt: We've always we've always stated and we continue we haven't seen anything that.

Matt: Gives us pause on what we've stated publicly in terms of migrating toward a negative $30 million loss for 'twenty. Four we haven't provided any any kind of guidance beyond that in terms of where we think the business will get from a financial performance beyond 24, obviously better than where we finished but.

Matt: Ideally, we'd love to get that business too.

From a negative 30 to zero and then eventually positive, but we haven't given a time horizon, specifically and just.

David Brian Katz: But we haven't given a time horizon specifically for that, as far as I can understand. And if I can just throw one follow-up in there with respect to the Tropicana, you know, my impression is there's a wide range of, you know, options. Is there a timetable by which you expect we might have some, you know, plan in place, something that, you know, we can put our own pencils to, you know, when we might know a little bit more?

Speaker Change: Understood and if I can just throw one follow up in there with respect to the Tropicana.

Speaker Change: My impression is is a wide range of.

Speaker Change: Options.

Speaker Change: Is there a timetable by which you expect.

Might have some <unk>.

Speaker Change: Land in place something that we can put our own pencil too.

Speaker Change:

Speaker Change: When we might know a little bit more.

Charlie Diao: This is Charlie Diao stepping on the question. They are building their stadium for the 2028 season. We have minimal capital required to supply them with their portion of the land to build. Pro Twitter. We have absolutely no urgency whatsoever to get to certain because our option value increases over time. The closer they get, the more that they invest, and the closer to 2020. While we understand that you would like to have some certainty, that's not how we maximize the value of that optionality.

Charles Diao: This is Charlie.

Charles Diao: On the question of this.

Charles Diao: The Ace are building their stadium for the 2020 season.

We have minimal capital required to supply them.

Charles Diao: A portion of the land to build.

April 28.

Charles Diao: We have absolutely no urgency whatsoever.

Charles Diao: To get to certainty.

Because our option value increases over time.

Charles Diao: Closer data the more that they invest in the closer to the 2020 season.

Charles Diao: We understand that you would like to have some certainty that's not how we maximize the value of that optionality.

Operator: Understood. Thanks very much. Yep.

Speaker Change: Understood Thanks very much.

Thanks, David.

Operator: Our next question comes from Jeff Stantial with Stiefel.

Speaker Change: Our next question comes from Jeff <unk> with.

Speaker Change: Stifel.

Jeffrey Austin Stantial: Hey, great, thanks. Afternoon, everyone.

Jeff: Hey, great. Thanks, Good afternoon, everyone and thanks for taking our questions.

Jeff: Maybe just starting out here.

The casinos and resorts segment markets. If I heard you correct, you called out a 35% brick and mortar margins, excluding EC the trop in Chicago.

Jeff: If I recall correctly I think the comparable metric was what's close to 38% in the prior year quarter. So first off could you just break out how much of an impact that flow through from adverse weather in January had on margins and then second how do you sort of think about the puts and takes here on the cost side heading into the remainder of 2024.

Jeff: Yes.

Jeff: Jeff I'll, let George Thanks for the question I'll, let George started net all give any color commentary should there be a need for it after he answers, yes, hi, Jeff and let me know if I'm missing anything there is lots of unpacking that.

Operator: Thanks for taking our questions. Maybe starting out here on the Casinos and Resorts segment, Marcus, if I heard you correctly, you called out 35% brick and mortar margins, excluding AC, the TROP, and Chicago. If I recall correctly, I think the comparable metric was close to 38% in the prior year quarter. So first off, could you just break out how much of an impact that flow through from adverse weather in January had on margins? And then second, how do you sort of think about the puts and takes here on the cost side heading into the remainder of 2024? Thanks.

Marcus Glover: Jeff, I'll let George, thanks for the question, I'll let George start and then I'll give any color commentary should there be the need for it. Hi, Jeff.

George Marcus: One of the questions was the.

George Marcus: The impact from weather.

George T. Papanier: Hi Jeff, and let me know if I missed anything; you have a lot to unpack in that. So one of the questions was the impact of weather. Last year we did 30, a 30% margin in January; this year we did 24. So obviously, it had a significant impact on the weather. Another data point would be if you look at February and March combined, last year we did 30, 6. 6, and this year, 33. This is, of course, without.

George Marcus: Last year, we did 30, 30% margin in January of this year. We did 24. So obviously you had a significant impact on whether another data point would be if you look at February and March combined last year, we did 30.

George Marcus: Six and this year 33. This is of course without.

George T. Papanier: Chicago, and also without Tropicana as Tropicana is winding down during Q1. So really, the only impact that we saw was really 100 basis points for those two months, and it was really as a result of specifically the union increases through collective bargaining last year and the latter part of 2023 that flowed through to this year. I don't know if I missed any part of your question.

George Marcus: Chicago and also without Tropicana tropicana's winding down during Q1, so really the only impact that we saw was really a 100 basis points for those two months.

George Marcus: Really as a result, specifically the union increases.

George Marcus: Through our collective bargaining last year and the like.

George Marcus: Second part of 2023 that flowed through this year.

Speaker Change: I don't know if I missed any part of your question.

Jeffrey Austin Stantial: No, I think you covered it perfectly. I just want to clarify one thing on that last point. So you were saying if you exclude Tropicana, AC, and Chicago, margins were down about a hundred bips year-on-year in February and March.

Speaker Change: No I think you covered it perfectly I just want to clarify one thing on that last point. So you were saying if you if you exclude Tropicana AC and Chicago margins were down about 100 bps year on year in February and March.

George T. Papanier: Oh no, that includes AC at this point, so if you exclude AC, then we're up closer to the levels that you described. I think you said 38%.

Speaker Change: No that includes agency at this point. So if you include if you exclude AC then were up closer to.

Speaker Change: The levels that you've described I think you said, 38%.

Jeffrey Austin Stantial: Okay, so in other words, adjusted for weather, and excluding those three assets, margins were essentially flat.

Speaker Change: Okay. So in other words adjusted for weather, excluding those three assets margins were essentially flat.

George T. Papanier: Yeah, and Jeff, one other thing that, I think it was in George's script, but in addition to weather, there was also some hold impact. Obviously, we expect that to come back to us throughout the year if the math works the way that it's supposed to work, but that has a slight impact on Q1 as well.

Speaker Change: Yeah, and Jeff one other thing that.

Speaker Change: I think it was in George's script and.

Speaker Change: Addition to weather there was also.

Speaker Change: Some hold impact.

Jeff: Obviously, we expect that to come back to us throughout the year, if the math works the way that it's supposed to work, but that had a slight impact on Q1 as well.

Jeff: Modest but.

Jeffrey Austin Stantial: Okay, perfect. That's very helpful. Thank you. Thank you both.

Speaker Change: Okay perfect.

Speaker Change: That's very helpful. Thank you. Thank you both and then for my follow up turning over to <unk> to the North America Interactive business in the prepared remarks, you talked about sort of sequential improvement, albeit not linear through 2024 in losses to get to the $30 million full year number I think you called out with a ramp in <unk>.

Jeffrey Austin Stantial: For my follow-up, turning over to the North America Interactive business, in the prepared remarks, you talked about, you know, sort of sequential improvement, albeit not linear, through 2024 in losses to get to the $30 million full-year number. I think you called out, we'll say, ramping online casino revenues as well as contribution from sports betting as the key drivers to sort of get there at that margin inflection. Can you just remind us kind of more what's going on on the cost side of the equation?

Speaker Change: Casino revenues is also contribution from sports betting as the key drivers.

Speaker Change: To sort of get there of that margin inflection can you just remind us kind of more what's going on on the cost side of the equation how much of that guidance.

Jeffrey Austin Stantial: You know, how much of that guidance and, you know, an eventual inflection to, you know, break even and then to positive margins is, you know, rationalization of marketing spend? And are you still carrying any duplicative tech costs, or what was the excess fixed cost otherwise?

Speaker Change: And eventual inflection to breakeven and then to positive margins is rationalization of marketing spend and are you still carrying any any duplicative tech coster.

Speaker Change: The excess fixed cost otherwise thanks.

Marcus Glover: So I'll try to unpack and answer all of your questions in there, Jeff. There are a couple of things. One is that we've gotten much better on the cost structure side of things and right-sized labor contribution. There will still need to be some winding down as we continue to improve that, but definitely some gains on that. But you've got to keep in mind, year on year, we are in, and Robeson, keep me honest on this, I think seven additional markets than we were for sports versus the same quarter last year. So, that definitely helps.

Speaker Change: Yes, so I'll try to unpack.

Speaker Change: And answer all of your questions in there Jeff a couple of things one is that.

Speaker Change: We've gotten much better on the cost structure side of things and right sizing labor contribution they will still need to be some wind down as we continue to improve that.

Speaker Change: But definitely some gains on that but you got to keep in mind year on year.

Speaker Change: We are in and.

Speaker Change: In road and keep me honest on this I think seven additional markets than we were for sports versus the same.

Speaker Change: Same quarter prior year.

Speaker Change: So that definitely helps we also in the spirit of how we view, our North American Interactive World, we shifted our retail sports betting business that exist.

Robeson Mandela Reeves: We also, in the spirit of how we view our North American Interactive world, shifted our retail sports betting business that existed in the casinos and resorts to our North American Interactive segment. Now, that had a modest impact, nothing material, but significant revenue gains are really what's driving the better outcome. Now, keep in mind also with the Rhode Island launch in Q1, there was a little bit of an additional labor boost to get open in time.

Speaker Change: Existed in the casinos and resorts to our North American Interactive segment that had a modest impact nothing material, but.

Speaker Change: Of significant revenue gains is really what's driving the better outcome now keep in mind also with the Rhode Island launch in Q1, there wasn't a little bit of additional labor boost to get opened.

Speaker Change: In time.

Robeson Mandela Reeves: We committed to Rhode Island that we'd be open by March, and we wanted to adhere to that commitment, so there was a little bit of a labor push, which increased a little bit of expense, but we think it was well worth it, given the early results that we're seeing in Rhode Island. So, to answer your question, in short, a lot of revenue gains, obviously on the strength of iGaming, but in more markets in sports, and some definite cost structure improvements.

Speaker Change: We committed to Rhode Island that we'd be open by March and we wanted to adhere to that commitment and so there was a little bit of a labor push which increased a little bit of expense, but we think it was well worth it given the early results that we're seeing in Rhode Island. So to answer your question in short a lot of revenue gains obviously on the strength of our gaming, but in more markets and sports.

Speaker Change: Definitely cost structure improvements.

Speaker Change: And we expect that to carry on and the cost to continue to come in line and subside while revenues continue to ramp on both of the verticals within North America Interactive.

Jeffrey Austin Stantial: Just to add one little piece, there is a bit of duplication in cost as well. We're currently running two technology stacks across North America Interactive. That will go away by the end of the year. That will not only reduce costs, but it will actually allow for much more fluidity of players across different state boundaries. Currently, we have multiple apps in the App Store. All of these journeys will become simplified once we're on a single technology stack.

Speaker Change: Just to add one little piece, there is a bit of duplication and cost as well. We're currently running two technology stacks.

Speaker Change: Across North America interactive that will go away.

Speaker Change: By the end of the year.

Speaker Change: That will not only reduce costs, but it will actually allow for much more fluidity plans across different state boundaries.

Speaker Change: Currently we have multiple apps in the App store all of these journeys will become simplified once we're on a single technology stack.

Operator: Okay, perfect. I apologize for the multifaceted questions, but you answered them all perfectly. So, thank you all.

Speaker Change: Okay, perfect I apologize for the multifaceted questions, but you answered all perfectly so thank you all.

Speaker Change: Thanks, Jeff.

Operator: Our next question comes from Dan Politzer with Wells Fargo. Hello, Dan, your line is live.

Speaker Change: Our next question comes from Dan policy.

Dan: With Wells Fargo.

Dan: Hello, Dan Your line is lobby for phones on mute please UN mute it sir.

Operator: If your phone is on mute, please unmute it, sir. OK, moving on. If you would like to ask a question, please press star 1. Again, to ask a question, please press star 1. Our next question comes from Chad Beynon from Macquarie.

Dan: Yes.

Speaker Change: Okay moving on.

Speaker Change: If you would like to ask a question. Please press star one again to ask a question. Please press star one our next question comes from Chad Beynon from Macquarie.

Chad C. Beynon: Thanks. Good afternoon.

Speaker Change: Thanks.

Chad C. Beynon: Good afternoon.

Chad C. Beynon: So wanted to focus on the temporary I know originally when you were opening.

Operator: I appreciate it. So I wanted to focus on the temporary. I know originally, when you were opening, property was generating roughly 9 million in monthly GGR last quarter. And, you know, in meetings, you've kind of talked about all the things that have changed since the, I guess, December period. Now you're at 13 million. Can you just kind of talk about what's left in terms of ramping, and then, more importantly, where margins are, and kind of what that looks like, and kind of how that feeds into the annual guide for CNR?

Chad C. Beynon: Pretty was generating roughly $9 million of monthly <unk> last quarter.

Chad C. Beynon: In meetings, you've kind of talked about.

Chad C. Beynon: The items that have changed since the.

Chad C. Beynon: I guess the December period.

Chad C. Beynon: Now youre at $13 million can you just kind of talk about what's left in terms of ramping and then more importantly.

Chad C. Beynon: Where margins are and kind of what that looks like and kind of how that feeds into the annual guide.

Speaker Change: For CNR. Thanks.

Marcus Glover: Yeah, Chad, I'll start, and then maybe George can give some additional color. As you stated, the property continues to do well with the ramping. Obviously, I don't know that there's a science behind how much ramp is enough ramp, right? So the team's going to continue to push and grow their market and continue to drive additional signups and customers for the database. But the idea is to really continue to drive that top line.

Speaker Change: Yes, Chad I'll start and then maybe George can you give some additional color.

George Marcus: As you stated the property continues to do well with ramping.

Speaker Change: Obviously, I don't know that there is.

Speaker Change: Our science behind how much ramp is enough ramp right. So the team is going to continue to push.

George Marcus: And grow their market.

George Marcus: And continue to.

George Marcus: Drive additional sign ups and customers who are the database, but the idea is to really continue to drive that top line.

Marcus Glover: We feel that if we continue to drive the top line, we can have enough meat to really begin focusing on profitability later. And so you'll continue to see us focus on driving the top line. Right now, profitability is pretty light, but that's somewhat intentional as we continue to focus on marketing, introducing people to our customers to the property and introducing them quite candidly to the Bally's brand and operation. So, George, I don't know if you have any additional color to add.

George Marcus: We feel that if we continue to drive top line, we can have enough meat to really began focusing on profitability later and so youll continue to see us focus on driving top line.

George Marcus: Right now the profitability is pretty light, but thats somewhat intentional as we continue to focus on marketing introducing people to our customers too.

George Marcus: To the property.

George Marcus: Introducing them quite candidly to the valleys brand in operations. So George I don't know if you have any additional color there.

George T. Papanier: The only thing I'll add, Chad, is... Marcus is right, we're going to stay very aggressive on the marketing end of this and continue to drive primarily the database. I think there's still a lot of opportunity there. We still have a lot of runway to penetrate the market, so we're going to stay aggressive there. And obviously, as you're ramping up and spending costs, your margins are impacted. You know, at a certain point, we'll flip the switch, and we'll see a lot of that flow through. We still have some tools.

George Marcus: Yes, the only thing I'll add hey, Chad.

Speaker Change: Mark This is right we're going to stay very aggressive on the.

George Marcus: On the marketing end of this.

George Marcus: And continue to drive primarily database, we think theres still a lot of opportunity there.

Speaker Change: We still have a.

Speaker Change: A lot of runaway to penetrate the market. So we're going to stay aggressive there and obviously as you are ramping and spending cost margins are impacted.

Speaker Change: At a certain point will flip the switch and we will see a lot of that flow through.

Speaker Change: And margin increases.

Speaker Change: Still have some some we still have some tools.

George T. Papanier: We continue to add parking. We continue to add certain types of incentives from a physical perspective. We've added a high-limit slot lounge. We're in the process of... Providing a VIP lounge, which is something that we feel we need primarily on the slot end of our business. And when you just break it down and look at table games, we're already at the metric that we thought we should be in the temporary environment, and we still think there's a lot of headroom to grow there. And on the slot side, we're just a little deficient or a little under where we think we need to be. So because of that, we're going to just keep being very aggressive from a market standpoint.

Speaker Change: We continue to add parking.

Speaker Change: We continue to add certain types of incentives from a from a physical perspective, we've added a high limit slot lounge.

Speaker Change: We're in the process of.

Speaker Change: Providing a VIP lounge, which has which is something that we feel we need primarily on the slot and of our business.

Speaker Change: <unk>.

Speaker Change: Just break it down and look at table games were already at the metric that we thought we should be.

Speaker Change: And the temporary environment and we still think there's a lot of <unk>.

Speaker Change: Headroom to grow there and on the slot side, we're just a little deficient or a little under where we think we need to be so.

Speaker Change: Those are that we're going to just keep very aggressive from a marketing perspective.

Chad C. Beynon: Great. I appreciate it. And then, with the launch of OSB in the UK, should we expect some additional marketing costs, or is the approach as of now really kind of, you know, focus on the current database, just cross-selling them another product that would be, I guess, margin neutral or maybe even margin accretive long-term? Thanks.

Speaker Change: Great I appreciate it and I see the progress and then with the launching of OSB in the U K.

Speaker Change: Should we expect some additional marketing costs or is the approach as of now really kind of focus on the current database just cross selling them another product that would be I guess.

Speaker Change: Margin neutral or maybe even margin accretive long term. Thanks.

Robeson Mandela Reeves: Yeah, so we've got the two prongs, as you call out; you've got existing players who already spend on sports offerings with our competitors. There's a large proportion of our player base who do that.

Speaker Change: Yeah.

Speaker Change: We've got the two prongs as you call out you've got existing players who already spend on sports offerings with our competitors.

Robeson Mandela Reeves: So we're hoping to consolidate some of that wallet into our system just by having a product that we're missing. Also, as you'll see in virtually every market, acquiring through sports is much cheaper than acquiring directly to casino, yet sports players often play casino too. So we look at it in both ways. I don't intend to spend more on marketing. I intend to just drive more volume through acquisition, longer term, because I've now got another tool in the locker, and we expect to see better ARPU because you're just getting a little bit more spend from the same players, which is spending on adults. I appreciate it.

Speaker Change: Theres, a large proportion of our player base, who do that so we're hoping to consolidate some of that wallet into our system just by having a product that we're missing.

Speaker Change: Also as Youll see in virtually.

Speaker Change: Market.

Speaker Change: Acquiring three sports.

Speaker Change: Is much cheaper than acquiring direct to casino yet sports players often play casino too. So we look at it in both ways to intend to spend more in marketing.

Speaker Change: Tend to just drive more volume through acquisition longer term because I've now got another tool in the locker.

Speaker Change: We expect to see better.

Speaker Change: Because you're just getting a little bit more spend from the same players.

Speaker Change: Which is spending on other offerings.

Operator: I appreciate it. Thanks, Robeson. Best of luck.

Speaker Change: I appreciate it thanks Robison best of luck.

Speaker Change: Yes.

Speaker Change: Brooks.

Operator: Our next question comes from Colin Mansfield with CBRE Institutional Research.

Speaker Change: Our next.

Speaker Change: <unk> is calling come from calling Mansfield with CBRE institutional research.

Colin Mansfield: Hey, everybody. Thanks for taking the call. Maybe first, a follow-up on the temporary situation in Chicago. I mean, second, it's definitely nice seeing the trends that you guys are putting up month over month.

Mansfield: Hey, everybody. Thanks for taking the call maybe first a follow up on the temporary in Chicago.

Mansfield: Second it's definitely nice seeing the trends that you guys are putting up month over month. So what are you guys learning about sort of the customer that's coming there is there anything you can share there in terms of what the catchment area of radius is maybe mix between local versus tourists.

Mansfield: Demographic mix of repeat visitation and things like that that would help us understand.

Mansfield: A little bit more about the customer that's coming there.

Mansfield: Great.

Operator: So, what are you guys learning about sort of the customer that's coming there? Is there anything you can share there in terms of, you know, what the catchment area or radius is? Maybe mix between local versus tourist, demographic mix or repeat visitation, things like that, that would help us understand, you know, a little bit more about the customer that's coming there?

Mansfield: I'll take that Colin this is George.

George Marcus: We mentioned that we're about 80000 in our database now I think 74000 at the end of March.

George T. Papanier: I'll take that call, and Mr. George, you know we mentioned that we have about 80,000 in our database now. I think 74,000 at the end of March. We're continuing to grow that database right now. The customer is skewing younger than you would typically see in a regional environment. And again, remember this is not a resort facility or or anywhere close to what we're going to have in a permanent facility. It's, again, a temporary facility, although very nice.

George Marcus: We're continuing to grow that database right now with customers skewing younger than you would typically see in a regional environment.

Speaker Change: And again remember this is not a resort facility.

George Marcus: Or anywhere close to what we're going to have a permanent facility.

George T. Papanier: It's more along the lines of what you would produce in a regional environment. So the customer is a little young. It's primarily driven by table games on the slot side of the business. You know, typically you'd see a higher percentage of females, and the age skews a little bit older. We're not seeing that yet. We're drawing significantly right now within a five-mile radius. That's not to say we don't draw significantly outside of that, but there's more of a concentration within the five miles, and we're going to continue to try and penetrate certain areas that we think demographically make sense, primarily through a lot of busing that we're currently doing.

George Marcus: Yes.

George Marcus: Again, a temporary facility, although very nice it's up more along the lines of what you would.

George Marcus: Producing.

George Marcus: Regional environment, so the customers a little young.

Mansfield: It's primarily driven by table games on the swap side of the business.

Mansfield: Typically see a higher a higher.

Mansfield: Our percentage of female.

Mansfield: And the skews a little bit older we're not seeing that yet we're drawing.

Mansfield: Particularly right now within a five mile radius, that's not to say, we don't draw significantly outside of that there is more of a concentration within the five miles and.

Mansfield: And we're going to continue to try and penetrate certain certain areas that we think demographic makes sense, primarily through a lot of bussing that we're currently doing in the market.

Colin Mansfield: Great. That's really helpful. Thank you.

Speaker Change: Great. That's really helpful. Thank you and then just one follow up on the international Interactive side, just maybe moving away from the UK and focusing on Asia for a moment.

Colin Mansfield: And just one follow-up on the international interactive side, maybe moving away from the UK and focusing on Asia for a moment. You know, you'd mentioned some variability in the business there. What's kind of driving that, and what are the signs of stabilization that you guys are seeing that are giving you comfort that you should see that market, you know, return to growth? And that's it.

Mansfield: You'd mentioned some variability in the business there.

Mansfield: What's kind of driving that and what are the signs of stabilization that you guys are seeing that are giving you comfort that you should see that market returned to growth and that's it.

Robeson Mandela Reeves: Well, the Asia business has always been a bit lumpy. It has sentiment challenges.

Mansfield: Well the Asia business has always been a bit lumpy has sentiment challenges.

Robeson Mandela Reeves: So driving new traffic has been hard at times. But the positive, sort of call it the green shoot that we're seeing, is that we launched online Pachinko. That has driven a large volume of new signups. We're getting traction because we're the only ones who have it. So actually that's getting cut through, driving new traffic to us. But I get a lot of comfort because the team to live working on that are showing they have exceptional control in how they can manage their business. You've got the revenue coming in, but the... The Conversion is excellent. [inaudible]

Mansfield: So driving new traffic has been harder times, the positive sort of call. It the green shoots that we're seeing as we launched online pachinko.

Mansfield: Driven a large volume of new sign ups and we're getting traction because we're the only ones who have it.

Mansfield: So actually that's getting cut through driving traffic to us.

Mansfield: I get a lot of comfort because the team working on that.

Mansfield: Showing they have exceptional control and how they can manage that business, you've got the revenue coming through but.

Mansfield: The conversion.

Mansfield: Excellent.

Mansfield: As we can see revenue has come back in USD, we should bear in mind that we're done.

Mansfield: 34 year low.

Mansfield: For Japanese currency to the dollar.

Mansfield: Which is pretty challenging to overcome anyway, but seeing new traffic coming through the door.

Speaker Change: Its definitely given us some comfort.

Speaker Change: Great. Thanks, everybody.

Speaker Change: Thank you.

Operator: We have no further questions at this time. I would now like to turn the call back over to Mr. Reeves for any closing comments.

Speaker Change: Today's call we have no further questions at this time I would now like to turn the call back over to Mr. <unk> for any closing comments.

Speaker Change: Okay.

Robeson Mandela Reeves: Thank you. I just want you all to keep in mind that our core is incredibly strong. We're managing our development pipeline extremely diligently to capitalize on all the opportunities ahead of us. The team is performing well, and I'm delighted to be part of it. We're very, very enthusiastic about delivering value to all of our stakeholders, and we're eager to provide you with many more updates in the next quarter. So let's stay in touch, and thank you all very much for joining us today. This does conclude today's program. Thank you for your participation. You may disconnect at any time. [inaudible]

Speaker Change: Thank you.

Speaker Change: So I just want you all to just keep in mind that our core is incredibly strong we're managing extremely diligently our development pipeline to capitalize on all the opportunities ahead of us.

Speaker Change: Team are performing well and I'm delighted to be part of it.

Mansfield: Very very <unk> about delivering value to all of our stakeholders.

Mansfield: We're eager to provide you with many more updates in the next quarter. So lets stay in touch.

Speaker Change: Thank you all very much for joining us today.

Mansfield: Yeah.

Operator: This does conclude today's program. Thank you for your participation. You may disconnect at any time.

Speaker Change: This does conclude today's program. Thank you for your participation you may disconnect at anytime.

Music: [inaudible]

Mansfield: Okay.

Mansfield: Okay.

Mansfield: Yeah.

Mansfield: Okay.

Mansfield: Okay.

Mansfield: Okay.

Mansfield: Okay.

Mansfield: [music].

Mansfield: Okay.

Mansfield: Okay.

Mansfield: Okay.

Mansfield: Okay.

Mansfield: Yes.

Mansfield: Okay.

Mansfield: Okay.

Mansfield: Okay.

Mansfield: [music].

Mansfield: Okay.

Mansfield: [music].

Mansfield: Uh-huh.

Mansfield: Yeah.

George Papanier: [music].

George Papanier: Okay.

George Papanier: [music].

George Papanier: Oh.

George Papanier: [music].