Penn's interactive division saw tremendous growth in 2020, with strong revenue and EBITDA margins for the Hollywood Casino iCasino product in Pennsylvania, solid results at the company's 16 retail bookmakers and the launch of the Barstool Sportsbook mobile app.
Penn National Gaming is strong despite turmoil caused by Covid-19
Despite a difficult past year and ongoing pandemic-related restrictions, Penn National Gaming maintained its resilience and reported solid financial results for the fourth quarter of 2020.
For the fourth quarter ended December 31, 2020. Penn National reported nearly $1.3 billion in revenue, down $23.4% from the same period in 2019. However, net income was $12.7 million compared to a net loss of $92.9 million. Adjusted EBITDAR was $365.4m, just 9% for the same period, reflecting the structural changes that were implemented with the onset of the pandemic.
Q3 2020. Net income increased from $43.7 million to $141.2 million, equivalent to an increase of 223%.
CEO Jay Snowden said revenue and adjusted EBITDAR were ahead of projections before the Covid-19-related outages in Illinois, Michigan and Pennsylvania and increased restrictions in Ohio and Massachusetts since mid-November .
The Southern segment was less restricted than other regions, but was still affected by Hurricane Laura . This business segment grew adjusted EBITDAR by 13% and improved adjusted EBITDAR margin by 720 basis points year-over-year, despite a 7% decline in net revenues.
During the company's fourth-quarter earnings conference call, Snowden told analysts that he expects the Barstool sports betting app to be introduced in 10 or 11 states by the end of 2021 . The app was released in Michigan on Jan. 22, four months after its debut in Pennsylvania. He said the Barstool app is expected to launch in Illinois in time for the NCAA "March Madness" basketball tournament.
"Since its launch in Pennsylvania last September, the Barstool Sportsbook app has registered more than 72,000 customers in the state and generated a total value of nearly $300 million, despite very limited external marketing spend."
Jay Snowden, CEO of Penn National Gaming
The company will also focus on investments in growth and technology. The implementation of 3C and other technology investments , such as the travel portfolio and increased engagement with a younger demographic, remains a top priority.
Meanwhile, construction has resumed on Penn's Category 4 casinos in York and Morgantown, Pennsylvania , and the company expects both to open in late 2021.