Century Casinos, Inc.

Welcome to Century Casinos Q4 2021 earnings conference call. This call is being recorded. At this time, all participants are in listen-only mode. Later, we will conduct the question and answer session. I would now like to introduce our host for today's call, Peter Hoetzinger. Mr. Hoetzinger, you may begin.

Good morning, everyone, and thank you for joining our earnings call. With me on the call are my co-CEO and the Chairman of Century Casinos, Erwin Haitzmann, as well as our Chief Financial Officer, Margaret Stapleton. As always, before we begin, we would like to remind you that we will be discussing forward-looking information, which involves a number of risks and uncertainties that may cause actual results to differ materially from our forward-looking statements. The company undertakes no obligation to update or revise the forward-looking statement whether as a result of new information, future events, or otherwise. We provide a detailed discussion of the various risk factors in our SSE filings, and we encourage you to review these filings. In addition, throughout our call, we refer to several non-GAAP financial measures, including but not limited to adjusted EBITDA. Reconciliation of our non-GAAP performance and liquidity measures to the appropriate GAAP measures can be found in our news release and SSE filing Available in the investor section of our website at cnt1.com. I will now provide an overview of the results of the fourth quarter. And after that, there will be a question and answer session. Our fourth quarter results continued the streak of record-breaking performances that we have shown throughout the year. Revenues exceeded the same period of the last year by 27%. adjusted EBITDA was 36% higher. Most of the EBITDA growth came from our casinos in the US, but also from Poland. Despite our record performance, it could have been even better. Canada had a difficult quarter because proof of vaccination was required to enter the casinos, and we were not allowed to serve liquor after 11 p.m., which slowed traffic down significantly. Thankfully, these restrictions have now been lifted and we are already seeing a nice rebound. Our other operations were also impacted by the Omicron variant, the COVID-related restrictions, as well as some supply and labor shortages, but our team successfully navigated through all of that and delivered great results. Our strong performance is the result of a disciplined operating philosophy and effective targeted marketing to our high-value customers. Our cost structure is more streamlined and our marketing and promotional investments are more targeted, which translates into increased spend per visit, especially from our most valuable players. The promotional environment in all our markets remains disciplined and rational, and while labor is tight in some markets, We've been able to maintain our high standards of guest experience. Our business is largely gaming-centric. Only a minority of our revenue is coming from non-gaming amenities. And we will only open more non-gaming amenities or expand their opening hours as demand picks up further so that it grows in a profitable way. The geographic diversity of our portfolio with locations in hyperlocal drive-to markets with a loyal customer base has proven extremely resilient in light of the pandemic. We will continue focusing on the right customer, enhancing customer convenience, building loyalty, streamlining processes, and reinforcing our operating efficiency through new initiatives and technology. Sports betting and iGaming both are profitable for us and have been profitable for us since day one. Early on, we decided not to participate in the costly red race for customer and market share. We took a zero investment and zero risk approach, meaning we simply provide our license to specialized sports betting companies. They pay us a revenue share with a minimum annual guarantee, and what we get from them goes straight to our bottom line. We have no cost against. Our two properties in Colorado, in Cripple Creek and Central City, increased EBITDA by 14%. The EBITDA margin was 35%. Two out of the three sports betting licenses we have in Colorado are in operation already. The third one with Bet365 as a partner is anticipated to go live next quarter.

In Missouri,