Bally’s Corporation seems closer to finding its way with improved financial results in Q1 2023, a management shake-up, and new partnerships to improve Bally Bet. The company has also struck a deal with the Oakland Athletics which will make their new home on the lot occupied by the Tropicana after their move to Las Vegas. Those plans include a new hotel and casino on the site, which has fueled concerns about continued employment for workers at the current property.
According to CEO Robeson Reeves, the company’s Q1 results highlight better performance by the troubled Interactive Division, giving investors hope. The division could see a further boost once Bally’s follows through on plans to launch its online casino in Pennsylvania.
With An Improved Q1, Bally’s Announces Management Changes
According to its report, Bally’s generated $598.7 million in revenue, up 9.2% year-over-year. Its adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) were $126.4 million, up 10.2%. As a result, Bally’s raised its guidance and expects losses of $40 to $50 million for 2023, much less than 2022’s $425 million.
Reeves said the North American Interactive Division significantly outperformed expectations due to faster-than-anticipated cost-cutting initiatives. According to him, the online Bally Casino holds over 4% of the market share in New Jersey, on course to achieve its goal of 6% to 8%.
Bally’s accompanied those encouraging results with the announcement of significant changes to its top-level management. Bobby Lavan, CFO and Executive Vice President, is out the door effective immediately. His replacement will be Marcus Glover, the former president of Borgata in Atlantic City and a gaming industry veteran.
Also, Charles Diao – a former DXC Technology executive and Wall Street veteran – has joined Bally’s as the Senior Vice President of Finance and Corporate Treasurer.
Bally’s is also changing its governance structure. It’s establishing an Operational Integrity Committee for its Board of Directors. Jaymin B. Patel, the board’s new Vice Chairman, will head the committee, focusing on cost reductions, improved operations, and establishing a new corporate center.
Deal With Oakland A’s For Ballpark at Tropicana Site
On May 15, 2023, Bally’s announced a deal with the Oakland A’s for nine acres of the Tropicana property. With the remaining 17 acres, Bally’s plans to build a new hotel and casino. That would mean a second new major casino resort for the company after Bally’s Chicago, which is on course to open in 2026.
The deal comes less than a month after the baseball team announced they’d secured a site adjacent to the Strip. With the new agreement, the ballpark will be on the Strip. Additionally, the A’s would require less public funding, around $400 million, instead of $500 million. Bally’s estimates the ballpark will attract 2.5 million visitors annually.
Another Round Of Layoffs for Bally’s?
As a side-effect of those plans, Tropicana employees received a letter informing them they would lose their jobs. It would be the second large round of layoffs by Bally’s this year. At the beginning of 2023, the company announced it would lay off 15% of workers in its underperforming North American Interactive Division.
However, in an update, Bally’s said the letter was sent prematurely and that no changes are expected for the next 18 to 24 months. Additionally, the company said it would support affected employees in finding jobs at other Bally’s locations while construction is underway.
The resulting uncertainty can’t be good for morale. Some analysts have suggested that nervous employees might now be looking to jump ship. That could be trouble for the company if it doesn’t intend to lay off its workers, as the industry is now facing a major labor shortage.
If Bally’s ultimately decides to go ahead with layoffs, it will face tough opposition from the Culinary Union 226, which has represented Tropicana workers since its opening in 1957. The union, representing 60,000 workers, has already stated it would fight to protect the workers’ rights.
Bally’s News Roundup
Recent months have been busy for Bally’s.
During the last quarterly results announcement, then-incoming CEO Reeves said Bally’s would look to improve Bally Bet and focus on the interactive division. The latest quarter’s results included a follow-up on that. Bally’s has announced a partnership with Kambi and White Hat Gaming to support the relaunch of the Bally Bet sportsbook later this year. The company had previously acknowledged that attempting to use in-house technology for its sportsbook had been a mistake.
Kambi is a major B2B software provider which works with many international gaming companies, including 888 Holdings, Kindred Group, parent of Unibet Online Casino, and Rush Street Interactive, parent of BetRivers Online Casino. Meanwhile, White Hat Gaming will provide Bally’s with its leading player account management platform. That includes tools like a proprietary cashier, traveling wallet, sports betting, and casino content. The deal could also pave the way for new slots at Bally Casino through White Hat’s iGaming subsidiary, White Hat Studios, which has been expanding rapidly in the US.
Reeves expects the company to launch Bally Casino Pennsylvania in May or June. That will be the second US state for Bally’s and its third North American market, after New Jersey and Ontario.
Additionally, while it would be in 2024, there’s hope that Rhode Island, Bally’s home state, will pass an online casino bill. The bill would make Bally’s the exclusive online casino provider. However, it’s currently on hold because some Senate members believe the legislation would require a change in the state’s constitution.