Pinnacle may sell Boomtown Reno, records third quarter net loss

Regional casino operator Pinnacle Entertainment said Thursday that it is negotiating to sell the Boomtown Reno, the Las Vegas-based company's only Nevada property.

As part of Pinnacle's third-quarter earnings announcement, the company said Boomtown Reno was classified as a "discontinued operation," meaning the property's financial results will no longer be reported.

A year ago, Pinnacle considered selling the 318-room hotel-casino, but nothing was formalized.

Pinnacle Chief Executive Officer Anthony Sanfilippo would not disclose the casino's potential buyers.

"Ultimately, we believe that if a sale is completed, Boomtown Reno will be well served by the new ownership team," Sanfilippo said.

Boomtown is on more than 570 acres just outside of Reno off Interstate 80. The property uses 73 acres, including 28 acres that were sold in 2006 to Cabela's, a national outdoor sporting goods retailer.

Boomtown also has a 203-space recreational vehicle park. The casino was opened in 1964 by current Reno Mayor Bob Cashell, who sold the property in the late 1980s.

Pinnacle said it recorded a noncash charge of almost $12 million, or 19 cents per share, to write down the property. Boomtown Reno generated $12 million in revenue in the quarter.

Credit-Suisse gaming analyst Joel Simkins said the sale of Boomtown, along with a sale the company's vacant land in Atlantic City "could be an unexpected positive" for Pinnacle's balance sheet next year.

Companywide, Pinnacle said it had a net loss of $790,000, or 1 cent per share, in the quarter ended Sept. 30. A year ago, the company lost $766,000 or 1 cent per share.

Pinnacle primarily operates hotel-casinos in the south and Midwest, including two casinos in St. Louis and three properties in Louisiana.

Pinnacle's third-quarter revenue rose 7.2 percent to $295.9 million from $275.9 million.

Pinnacle also said it was restating its second-quarter results because of an accounting change related to the company's "mychoice" player loyalty program expenses.

"On an operating basis, Pinnacle had another very strong quarter," Sanfilippo said. "While several charges and other items affected year over year comparability, our third quarter results again highlight the effectiveness of our revenue growth and operational improvement initiatives."

Contact reporter Howard Stutz at hstutz@reviewjournal.com or 702-477-3871. Follow @howardstutz on Twitter.