GCG Posts Stellar Q2-19 Results, CEO Predicts Bright Future

Future looking bright for Canada’s largest casino firm.

Future Looks Bright for Canada's Largest Casino Firm, Great Canadian Gaming

The executive board members of Great Canadian Gaming (GCG) are putting on their shades after last week’s gleaming revenue report highlighted excellent second quarter results with a brilliant outlook for the next half of 2019. Revenues and shares were up, divestments and projects were completed, and new partnerships were forged.

GCG Chief Executive Officer Rod Baker is particularly pleased with the company’s performance over the last three months ending June 30, 2019, and is looking forward to a very bright future – especially in Ontario, where a powerful focus is resulting in the most growth. He believes its the company’s “disciplined approach” to fortifying GCG’s infrastructure with strategic expenditures that’s driving the firm ahead at such a phenomenal pace.

Revenues Soar for Canada’s Largest Casino Firm

In the financial highlights segment of last Tuesday’s GCG second quarter (Q2) 2019 earnings conference call, Baker noted a 20% increase in revenue, rising from $295.2 million in Q2-18 to $354.4 million in Q2-19. He attributed the boost in revenue to a variety of rationale:

  • One extra month of operations at properties in the company’s West GTA Gaming Bundle, compare to the same time period last year.
  • Additional revenue from newly introduced table games at Woodbine Casino.
  • Additional revenue from expanded gaming opportunities at Elements Casino Mohawk.
  • Heightened revenue from East Gaming Bundle following grand openings of Shorelines Casino Peterborough (Oct. 15, 2018) and Shorelines Slots at Kwartha Downs (Dec. 19, 2018).

GCG’s expenditure budget for the Ontario Gaming Bundle was nearly doubled year over year from $12.7 million to $23.6 million in Q2-19.

Revenue also rose in the British Columbia market, but the increase was attributed primarily to a single occurrence – a labour disruption at Hard Rock Casino Vancouver “that resulted in limited gaming and hospitality offerings for a portion of 2018.”

Shareholders earnings were a topic of much rejoicing during the conference call. GCG’s investors experienced net earnings of $48 million ($0.81 per common share) during the second quarter, an increase of $7.4 million ($0.15 per common share) YoY.

H2-19 Strategy: Spend Money to Make Money

“2019 is a year of significant capital expenditures as we build our infrastructure in Ontario to execute our strategic plan,” explained CEO Baker. “We have already accomplished several major milestones in the first half of the year including the new building addition at Great Blue Heron Casino and the gaming expansion at Elements Casino Mohawk. For the remainder of 2019, we continue to work towards completing several developments in Ontario, particularly at Elements Casino Flamboro and Elements Casino Grand River, which will include expanded gaming and new food and beverage offerings that we expect to complete by the end of 2019.”

Baker also spoke of the two-phase opening of Pickering Casino Resort, the first of which is scheduled to occur in Q1-20. The first phase will include gaming and dining venues. The timeline for the second phase has yet to be determined, but it will include “premium nongaming amenities”, like a hotel, retail stores, entertainment venue and additional dining options.

In closing, Baker credited the company’s recent and ongoing success to its “disciplined approach to use of capital opportunities and to explore opportunities that will improve our business and increase value to our shareholders.”

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