Gamehost (GH) Q2 2024 earnings summary

Executive summary

• Operating revenue for Q2 2024 decreased 2.5% year-over-year to $20.3 million, with EBITDA down 8.9% to $8.0 million and EPS at $0.23, compared to $0.25 in Q2 2023.

• Table activity grew, but lower Hold % at Deerfoot and reduced slot activity impacted revenue; hotel occupancy softened from prior year highs.

• Rivers Casino faced temporary closure or reduced hours for six days due to wildfire threats, contributing to lower revenue.

Financial highlights

• Six-month operating revenue rose 0.4% year-over-year to $40.9 million; Q2 revenue fell 2.5% to $20.3 million.

• Q2 gross profit declined 8.4% to $7.9 million; profit from operating activities dropped 9.4% to $6.9 million.

• Q2 net profit was $4.8 million, down 10.4% year-over-year; EBITDA margin for Q2 was 39.1%.

• Cash at June 30, 2024 was $14.5 million; total debt reduced to $41.2 million from $46.2 million at year-end.

• Declared a $0.04 per share August dividend, annualized at $0.48 per share.

Outlook and guidance

• Management is focused on cost control and investing in high-return areas amid slower economic growth.

• Temporary two-year increase in slot commissions to operators continues, set to end March 31, 2025.

• Bank of Canada rate cuts in June and July expected to provide relief to Alberta households.