Bally’s expansion in Q1 2024: performance analysis and future positioning
Bally’s Corporation has started 2024 on a promising note. The company’s Q1 2024 results reveal a strategic expansion plan and a positive market positioning.
Bally’s reported a revenue of $618.5 million in Q1 2024, marking a 3.3 percent year-on-year increase.The company’s Casinos and Resorts segment saw a revenue rise of 4.1 percent year-on-year, reaching $342.3 million. However, the international Interactive revenue saw a slight dip of 4.4 percent, settling at $234.7 million. On the brighter side, North America Interactive revenue witnessed a significant surge of 70.2 percent year-on-year, amounting to $41.5 million.
iGaming revenues in Rhode Island have ramped nicely through April in accordance with expectations, and we believe this momentum will continue to build through the balance of 2024
Robeson Reeves, CEO
Despite these positive numbers, the company’s adjusted EBITDA fell to $116.5 million in Q1 2024 from $126.3 million in Q1 2023.
Bally’s CEO, Robeson Reeves, expressed optimism about the company’s performance in Q1 2024. He attributed the solid start to the year to the revenue growth in the Casinos & Resorts and North America Interactive segments. During the quarter, Bally’s also launched iGaming in Rhode Island as the sole provider, a move that aligns with the company’s expansion strategy. Reeves stated that the North America Interactive segment’s results were in line with Bally’s expectations.
Sports betting expansion
The decline in the international interactive segment was mainly due to operations outside the UK. However, Bally’s managed to leverage the uncertainties created by the white paper in the UK, resulting in strong revenue growth. The company aims to launch online sports betting in the UK to complement its iGaming offering and add another customer acquisition funnel.
Reeves also highlighted the potential of their operations in Spain, which are well-positioned to benefit from the recent removal of advertising restrictions. This change will enable Bally’s to increase its investment in faster growth. The company also anticipates further stabilisation of its operations in Asia with an enhanced online sports betting offering.
Bally’s 2024 guidance remains unchanged, with revenue expectations in the range of $2.5 billion to $2.7 billion and adjusted EBITDAR in the range of $655 million to $695 million. The full-year guidance includes the impact of the closure of Bally’s Tropicana Las Vegas casino in April 2024 but also considers the ramp of the Chicago Temporary Casino. It also assumes growth in the international interactive division and a revenue rise due to the introduction of iGaming operations in Rhode Island.
Mixed impact on stock performance
Bally’s Corporation (BALY) is trading at $13.00, down by 1.22percent. This indicates that despite the strategic moves and financial performance in Q1 2024, the stock has experienced a slight decrease. The company is experiencing a positive trend in its revenue growth, especially in the Casinos and Resorts and North America Interactive segments.
The company’s strategic move to launch iGaming in Rhode Island as the exclusive provider has further strengthened its market position.
However, it hasn’t been a smooth sail. The company experienced a drop in International Interactive revenues, mainly due to operations outside the UK. This reflects Bally’s strategic decision to focus on enhancing profit margins rather than chasing growth that may not be economically viable. This shift led to some tough comparisons with the previous year’s revenue. Despite these hurdles, Bally’s has successfully increased its Adjusted EBITDAR by 4.0 percent year-over-year, enhancing the profitability of its segments. This growth, coupled with the company’s strategic expansion plans, could potentially influence the stock performance positively in the future. It’s a testament to Bally’s resilience and strategic foresight in navigating the dynamic gaming industry landscape.
It remains to be seen how the company’s ongoing and future initiatives will influence its stock performance.
