Penn National Gaming Profits Decline by 11 Percent | IXGAMES

In a statement released by Penn National Gaming, racetrack and regional casino operator, first-quarter profits for the company have fallen by 11 percent, compared from a year ago.  The falling revenues are attributed to the spending and gambling activities of consumers and some macroeconomic factors.  The company cited these reasons that led to the decline. Falling revenues The sharp decline in first quarter profits compared to a year ago had been brought about by consumers’ reduced spending on gambling activities. These figures had been compared to the first-quarter report made after a year. A net income of $36.2 million had been reported by the company, which translates to 34 cents per share. This income was for the quarter that ended on March 31. Penn National reported a $40.7 million net income, which translates to 38 cents per share. From $612.2 million to $592.3 million, revenue was knocked down by 3.3 percent. Macroeconomic factors Peter Carlino, the Chief Executive Officer of Penn National Gaming, has stated how macroeconomic environment factors have played a role in the revenue trends experienced for the first quarter. Apart from macroeconomic environment factors, weather impacts, which had not been greatly anticipated, have had a considerable effect on the Penn National properties as well. Carlino added that cost-cutting measures will continue to be implemented throughout the properties owned by the company. Wall Street not disappointed Carlino has stated that it will probably take some time for margins to resume to normal levels, and with the high margins normally enjoyed by the business, this will be difficult to attain until revenues go back to usual levels. As much as Penn National has been dissatisfied by the fall in revenues, Wall Street meanwhile was not disappointed by the quarterly results. Joe Greff, gaming analyst at JP Morgan, told investors that although revenues have fallen way below the anticipated levels, Penn was still able to display considerable improvement on property level margin, despite the stormy weather experienced during the first quarter. Currently, Penn National manages casinos and racetracks in the Unites States, and not just limited to those in Las Vegas and Atlantic City. The company has expressed interest in buying out a Las Vegas-based hotel and casino. In a statement to investors recently, the company has reported how it hopes to take advantage of the new table games added to two of its casinos, located in West Virginia and Pennsylvania, formerly known as being slot-machine-only markets. Growth schemes According to one analyst, the company has other plans for growth especially on a regional level. Joel Simkins, analyst at the Macquarie Securities, has predicted that investors will concentrate more on timing and the carrying out of recent casino projects, especially those located in Maryland, Ohio, and Kansas, for the next two years or so. He has also added that although Penn National has not commented about any plans on mergers and acquisitions, it is highly probable that more assets will penetrate the market and the company will soon be considering better opportunities. On the NASDAQ National Market, the shares for Penn National Gaming increased by 2.75 percent at 81 cents, on Thursday, closing at $30.24.