News Column

Pinnacle credits Ameristar acquisition for boost in earnings

February 12, 2014

By Richard N. Velotta, Las Vegas Sun



Feb. 12--Las Vegas-based Pinnacle Entertainment, operators of 16 casino and racino properties in nine states, including two in northern Nevada, reported its fourth-quarter earnings Wednesday.

Company: Pinnacle Entertainment (NYSE: PNK)

Revenue: $535 million (up 110 percent from the fourth quarter of 2012). Pinnacle's acquisition of Ameristar Casinos more than doubled the company's fourth-quarter revenue.

Earnings: $15 million (up from loss of $42.4 million in the fourth quarter of 2012). The company began seeing the benefits of the Ameristar acquisition, completed in the third quarter. The company retired loan debt and began divesting properties.

Earnings per share: 25 cents (up from a loss of 72 cents a share in the fourth quarter of 2012). The costs associated with the Ameristar acquisition resulted in a loss for the year. The company reported a loss of $4.36 a share for 2013 compared with a loss of 52 cents in 2012.

What it means: Pinnacle is a company in transition with the Ameristar acquisition, and executives said they made strides in blending the culture of the two companies. Pinnacle is in the early stages of developing revenue synergies across its portfolio.

The company is gearing up for the May 1 opening of a racino, Belterra Park Gaming and Entertainment Center, in Cincinnati, Ohio. It also will relaunch its loyalty card program in April for Pinnacle and former Ameristar customers. The company hasn't announced the name of the program, and its integration is expected to be completed by mid-2015.

Company executives also said they estimated losing $2 million in cash flow for the year as a result of severe winter weather.

Anthony Sanfilippo, Pinnacle's CEO, acknowledged that bad weather has resulted in a rocky start in the first quarter of 2014.

The company's strongest operations for the quarter were at its L'Auberge resorts in Baton Rouge and Lake Charles, La., both reporting record cash flow.

In Nevada, Pinnacle operates former Ameristar properties Cactus Petes and the Horseshu in Jackpot.

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(c)2014 the Las Vegas Sun (Las Vegas, Nev.)

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Source: Las Vegas Sun (NV)


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