Bally's Corporation

Good day and thank you for standing by. Welcome to the Bally's Corporation third quarter 2022 earnings conference call. At this time all participants are in the listen only mode. After the speaker's presentation there will be a question and answer session. In order to ask a question during the session please press the star key followed by the number one on your telephone. Please be advised that today's conference is being recorded. If you require any further assistance please press star then zero. I'd now like to turn the call over to Bobby Levan, Chief Financial Officer for Bally's. Please go ahead, sir.

Good morning, everyone, and thank you for joining us on today's call. The earnings release and presentation that accompany this call are available in the investor relations section of our website. With me on today's call are Lee Fenton, Chief Executive Officer, George Papineer and President Retail, and Robeson Reeves, President Interactive. Before we begin, we would like to remind everyone that comments made by management today will contain forward-looking statements. These forward-looking statements include plans, expectations, estimates, and projections that involve significant risks and uncertainties. These risks are discussed in the company's earnings release and SEC filing. Actual results may differ materially from the results discussed in these forward-looking statements. In addition, during today's call, management will refer to certain non-GAAP financial measures Reconciliations to the most comparable financial measures are included in the schedules in our earnings release. We do not provide reconciliation of forward-looking non-GAAP financial measures due to our inability to project special charges within certain expenses. Today's call is also being broadcast live on our investor site and will be available for replay shortly after the completion of this call. Now handing it over to Lee.

Thank you, Bobby, and hello, everyone. We are one year on from bringing GAINSYS into the Bally's family and the industrial logic remains as strong as ever. We now have a powerful global business with diversity of revenues and EBITDA. The casinos and resorts segment is going from strength to strength as the portfolio of properties goes into the next phase of integration. The interactive business had a tough COVID-driven comp to overcome and has been impacted with negative FX swing 322. The Q3 has seen Interactive move to greater stability and profitability. As promised, we continue to deliver strong free cash flow from what is now a globally and channel diversified business. The optimal integration of our combined assets remains unfulfilled for now, as we still have work in progress but we have made significant strides towards fulfilling that vision. The awareness of the Bally's brand continues to grow, and employees from table dealers to tech developers identify as Bally's team members. Integration beyond the brand on the casinos and resort side has begun, and we're starting to see the fruits of that later. Bally's Chicago is a game changer for the group, And the early performance of Tropicana Las Vegas has been encouraging, and we're delighted to finally have a presence on the strip. New Jersey iGaming climbed to a 3.5% market share in the quarter, with CPA significantly below our peers, as we broaden the options available to our bricks and mortar database. New Jersey is shaping our blueprint thinking for future states. For the third quarter, we had tremendous results in casinos and resorts. Lincoln outperformed, finishing just shy of double-digit revenue growth, coupled with a continued focus on margin and initial growth of the IGT JV. That JV goes from 23% to 40% on January 1 and will drive incremental earnings into 2023. Atlantic City. had 9.5 million positive EBITDA to bring the year-to-date result to positive 1 million. We do expect AC to be negative in Q4 as we continue our progress on right-sizing the cost structure there. We have seen further growth in the higher tiers of our database across the portfolio, helped by a more aggressive push on tables in our more recently acquired properties. Our EBITDA margin, XAC, was ahead of expectations at 39.5%. With a more integrated portfolio, we are now benefiting from cross-marketing, cost efficiencies from purchasing power, and increased centralization, proving our strategy to bring the properties together. In international interactive, the UK was slightly up year over year on a constant currency basis, delivering a record number for our UK business and the first positive quarter since Q3 2021. We expect that Q4 will also be positive in the range of high single digits. Performance was driven by more targeted marketing spend, more dynamic jackpot strategies, and enhanced customer journeys powered by machine learning. The UK white paper continues to be delayed following government leadership changes, and while ongoing delay brings some unwelcome uncertainty for the industry, it has given us ample time to prepare our business for a range of potential outcomes should the white paper be forthcoming in the near future. continued some of the weakness we saw in the second quarter, being down 3.3% year over year on a constant currency basis. We are beginning to revise our marketing strategies to maintain profitability in the region. We have seen blips like this in Asia before. We remain confident in the market and our ability to grow the business. Our new sportsbook there has launched in time for the World Cup, and the customer funnel is supported by free-to-play games from our sport-caller team. We will continue to harvest Spain and our wine down in the rest of Europe. North America Interactive continues to be in both development and ramp-up mode. New Jersey had 12 million of GGR and 8.3 million of NGR from our iGaming offer in Q3, showing discipline in bonusing and giving us a contribution margin in the mid-30s. We rolled out new lobby and more games from multiple partners during the period. We expect New Jersey iGaming to continue to grow and be profitable for the rest of the year. We are targeting six to eight points of market share in 2023 after the implementation of omnichannel rewards, along with improvements in payment processing and marketing tools. Our Bally branded app in New Jersey continues to deliver a very attractive cost of acquisition for depositing players, even before the marketing tech stack improvements that will be coming in 2023. Different states will have different characteristics, and our focus is on creating the blueprint for states of a similar type before we invest in rollouts. As I said, iGaming states are our priority, and we will focus resources in markets including Pennsylvania, in Ontario, as well as states that we believe will regulate iGaming in 2023. Our progress on sports has taken longer than we expected, and we will not support the sports-only markets with marketing dollars until we are comfortable that we've got the user experience and the technology where we want it. Yesterday, in Ontario, we launched our first combined casino and sportsbook app. We will continue to focus on being eye-gaming-led in Ontario, which we expect to become one of the most significant markets of scale in the North American footprint. Our focus remains on the continued development of our product and the market blueprints, rather than being overly aggressive on rollout. Now, let me turn it over to Bobby to give you the financial highlights for the quarter.