01/29/2015 9:58AM

Penn National Gaming takes $233.2 million loss for 2014

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Penn National Gaming Inc., the owner of 26 casinos and racetracks across the U.S. and Canada, took a $316.5 million impairment charge in the fourth quarter of 2014, leading to a $233.2 million loss for the year, according to financial statements released on Thursday.

The impairment charge was assessed against the value of the company’s goodwill and its casino licenses, the company said. The charge was taken in the first full year in which Penn National paid rent on its properties to a company it spun off late in 2013 to take advantage of favorable tax laws, making comparisons between 2013 and 2014 difficult.

Net revenue for the year was down 11.2 percent, from $2.92 billion in 2013 to $2.59 billion in 2014. Total operating expenses declined 23 percent year-over-year, from $3.69 billion in 2013 to $2.83 billion in 2014, but a substantial portion of the decline was due to an even larger impairment charge in the fourth quarter of 2013. In that quarter, Penn National took a $1.13 billion impairment charge.

Gambling revenue for the year was down from $2.62 billion in 2013 to $2.3 billion in 2014. The company’s 2014 rental expense – the amount of money it paid to the newly spun-off company – was $421.4 million, compared with $69.5 million in 2013.

Casino companies are operating in much more competitive environments across the U.S. as the market becomes more and more saturated. Penn National estimated in the financial statements that it will have net income of $41.3 million for 2015.

According to the financial statements, Penn National had debt of $1.26 billion at the end of 2014, compared with debt of $1.05 billion at the end of 2013.

Penn National’s racetrack properties include Penn National in Pennsylvania, Charles Town in West Virginia, Mahoning Valley in Ohio, Zia Park in New Mexico, and Sam Houston in Texas.

Chris Mickshaw More than 1 year ago
Let me do the math here you own 26 casino's and you lost 233.2 million dollars in 2014?LOL!!On top of that you have 1.26 BILLION in debt?If you wanna tell a little white lie here and there it is ok.When you throw those kind of numbers in the air I think its safe to say someone check the books.STUPID!!In the ends remember pigs get slaughtered, and I smell a lot of bacon..
Mark D More than 1 year ago
Gotta love these crooks and thier crestive accounting. Setting up seperate companies for the "Rent"...while showing huge losses on the casion.
Walter More than 1 year ago
It is really difficult to believe this is true. Accountants can & will cook the books to portray any message they prefer. If true, then another quarter or two like this will spell the end for them. That will be the acid test.