Caesars Q1 2023 Report Shows 25% Revenue Increase, But Net Losses
Caesars Entertainment made $2.8 billion in revenue over the first three months of 2023, as stated in its Q1 earning report released this week.
The veteran casino operator saw net revenues increase by 23.5%, but still had an overall $136 million loss. However, that’s 80% better than its $680 million loss in the same period last year.
The overall revenue rise was mostly driven by Caesars’ Las Vegas Casino Resort properties: Caesars Palace, Harrah’s, Bally’s, and the Flamingo.
The Caesars Digital division also turned in positive net revenue in this quarter at $238 million, but still had a $32 million overall loss.
“We delivered another strong quarter, led by a new Q1 Adjusted EBITDA record in Las Vegas,” said Caesars CEO Tom Reeg.
“Results in our regional segment remained consistent with prior quarters, especially when excluding the impact of bad weather in Northern Nevada during the quarter. Our digital segment was nearly breakeven in the quarter, despite launching operations in Ohio and Massachusetts,” he said.
Caesars’ Las Vegas casino revenues were up 22.7% on Q1 2022 at $1.56 billion. Food and beverage revenue also jumped 25% during the quarter.
Caesars was not involved in any acquisitions or mergers during this period, as it seeks to reduce a $13.15 billion debt pile.
“On May 1, we fully redeemed the $400 million Caesars Forum Convention Center mortgage note due 2025, resulting in over $32 million in annual interest expense savings,” said Caesars CFO Bret Yunker.
“We continue to target a third consecutive year of $1 billion of permanent debt reduction.”
Despite that debt, Caesars is still making some upgrades to its Las Vegas strip properties.
This week, it announced a large scale renovation plan for its Paris Las Vegas property. The $100 million investment will add 756 rooms to the resort by integrating and fully upgrading the Horseshoe’s Jubilee Tower.
It will be renamed the Versailles Tower to fit the Resort’s French theme, and it will have some of the biggest standard room sizes of any hotel on the Strip.
On a conference call this week discussing the earnings report, Reeg mentioned several reasons he was positive about Caesars’ outlook for 2023. That included the recent rise in hotel and convention space demand, the growing popularity of the NFL’s Las Vegas Raiders, and the potential for the city to land a Major League Baseball franchise.
The city and Caesars also looks forward to the Las Vegas Grand Prix in November. Reeg told investors it could drive a 5% increase in revenues for Q4 2023.
He wasn’t exactly holding back about the high-class guests Caesars wants to attract, with more visitors flocking to Las Vegas.
“You’re bringing in higher-value customers and you’re already full, so you’re kicking out the lowest end,” he said in the earnings call. “I see no reason that needs to — or would stop. This market continues to add reasons for people to come and add capacity.”
The operator is offering a $5 million guest package for the Formula 1 race weekend, including exclusive VIP race tickets and celebrity chef meals.