Helped by strong promotions in Atlantic City, Harrah’s Entertainment Inc. (HET) saw its third-quarter profit climb 38% to $244.4 million or $1.28 per share compared to last year’s $177.2 million or $0.95 per share.
During the period, revenues rose 13% to $2.84 million from the comparable $2.5 billion.
Adjusted earnings from continuing operations climbed to $1 per share from last year’s $0.94 per share. Analysts generally had expected earnings to be $1.01 per share.
The positive experience failed to have a major impact on the company’s share price since the company is awaiting the completion of a takeover plan for $17.1 billion prepared by the partnership of Apollo Management Group and Texas Pacific Group.
Las Vegas revenue during the period also jumped a healthy 11% to $900.4 million while Atlantic City properties saw their revenues increase by 20% as a result of "effective marketing."
Also contributing to the company’s revenues was a "strong performance" at the newly-opened Harrah’s Chester Casino and Racetrack in Pennsylvania.
A 177% earnings surge surprise came from the company’s acquisition of London Clubs International PLC which operates seven casinos in the U.K., two in Egypt and one in South Africa. The company contributed $165.1 million to Harrah’s revenues.
No timetable for the private-equity acquisition of the company was given but it is expected to close in early 2008.
International Game Tech.
Analysts split in their opinion of the financial experience of International Game Technology (IGT) for the fourth fiscal quarter of 2007.
Despite strong revenues that were boosted by international sales, analysts were concerned that product sales in the U.S. and Japan were light.
Still, revenues reached $353.3 million, up from the $333.8 million the company reported in the fourth quarter of 2006. Earnings were $122.6 million or $0.38 per share compared to $114.9 million or $0.33 per share last year.
IGT increased their machine shipments to 23,400 units, a jump of 1,000 machines over the comparable period. Also, the company said its installed base during the fiscal year grew to a record 59,200 units, more than 9,000 machines than were reported in the previous period. Helping increase the placements were units sent to Mexico and New York.
Steve Kent of Goldman Sachs wrote in an investors note that "IGT continues to produce solid quarters in a challenging environment, but the stock is likely range bound. Most investors expected machine sales to slow but the deceleration was likely grater than most forecasts."
In her assessment, Robin Farley of UBS Securities wrote, "our first read is that there isn’t much to get excited about in the results, but it’s also a quarter that at first glance doesn’t change our view of IGT’s long-term story."
Boyd Gaming Corp.
A year ago, Boyd Gaming Corp. (BYD) posted a loss in its third-quarter financial experience, primarily because the company took an impairment charge of $65 million as a result of its sale of South Coast Hotel/Casino to Michael Gaughan.
Without that charge this year, the company saw its earnings rise to $31.9 million or $0.36 a share, compared to a $12.9 million of $0.15 per share loss in 2006.
Excluding expenses attributed to the company’s development of Echelon resort on the Las Vegas Strip, the company had adjusted earnings from continuing operations of $38.4 million or $0.43 per share, a shade under last year’s adjusted earnings of $38.8 million or $0.44 per share.
Analysts expected net income to be in the $0.42 per share range.
Revenue for the quarter fell to $490.1 million, down eight percent from $530.7 million of last year.
The company said this resulted from the loss of revenue from the company’s imploded Stardust Hotel/Casino as well as lower gambling, room and food/ beverage revenue from existing properties.