Parent of Tropicana on Strip reports stronger revenue, earnings

The company that owns and is investing heavily in the Tropicana resort on the Strip reported improved third-quarter revenue and earnings Thursday.

Wyomissing, Pennsylvania-based Penn National Gaming, which also owns the M Resort in Henderson, is in the midst of major upgrades at the Tropicana, which the company acquired for $360 million last year.

“Since last summer’s acquisition of Tropicana Las Vegas, we made meaningful progress with our Phase I investments serving to make the property both more profitable and more attractive to players,” said Penn National President and CEO Tim Wilmott. “The upgrades include a wide range of facility and operational improvements intended to leverage the property’s high-quality room base, further improve the overall customer experience and provide for a refreshed gaming floor that features new slots, improved merchandising and refinements to the table-game mix.”

The company on Thursday reported net income of $46.5 million, 51 cents a share, on revenue of $765.6 million for the quarter that ended Sept. 30. For the same period a year ago, Penn reported net income of $4.9 million, 5 cents a share, on revenue of $739.3 million.

The company launched its Marquee Rewards loyalty card program at the Tropicana earlier this year. It also made plans to partner with Food Network celebrity chef Robert Irvine, who will open his first signature restaurant on the Strip next year.

“We continue to develop a Phase II master plan for the property that we expect will include additional food, beverage, retail, entertainment and other non-gaming amenities and enhancements,” Wilmott said. “The plan seeks to further leverage returns from our 35 acres of property and Strip frontage and is predicated on generating strong near- and long-term returns.

”We continue to believe that with our initial $360 million purchase price that we are well-positioned to create an important source of growth for Penn National based on the quality of the asset and room base, our progress to date in generating improved financial results, the successful application of our player loyalty program to improve the effectiveness of our hotel yielding strategies and the recent developments on the south end of the Strip,” he also said.

Earlier this year, Wilmott expressed enthusiasm for the prospect of a National Football League stadium less than a mile away from the Tropicana. MGM Resorts International and Penn would be among the biggest geographic beneficiaries of a stadium located at Interstate 15 and Russell Road as planned.

Penn owns 32 properties, including race tracks and off-track betting centers in 16 states and Ontario, Canada. It owns the Hollywood brand and earlier this month opened and is managing the three-story tribal Hollywood Casino Jamul property near San Diego.

The company also recently acquired Rocket Gaming, a social media platform.

In its guidance to investors, Penn warned that its Hollywood Casino at Charles Town Races in Charles Town, West Virginia, could be adversely affected by the opening of MGM National Harbor in Maryland slated for Dec. 8.

Shares of Penn slipped 17 cents, or 1.29 percent, to $13.03 on Thursday.

Contact Richard N. Velotta at rvelotta@reviewjournal.com or 702-477-3893. Follow @RickVelotta on Twitter.