The vast majority of the operator’s revenue – $1.29bn – came from gaming, which was a 19.3% increase. Food, beverages and other income made up the remaining $273.0m, growing 41.5%.
Breaking Penn National gaming’s revenue down geographically and by division, $658.5m came from the operator’s Northeast segment, up 15.4%. A further $341.4m came from the South, up 15.4%, $140.9m from the West, up 45.4%, and $282.9m from the Midwest, a 20.5% increase.
A further $141.5m of revenue came from the Penn Interactive division, which now also includes Canada-based operator theScore. This total was up 63.4% from Q1 of 2021.
“We are driving momentum at our interactive segment with ongoing sports betting and icasino growth in the US, and the successful launch of mobile sports betting and icasino in Ontario on 4 April on theScore’s proprietary player account management system and bonusing engine,” said Jay Snowden, president and CEO of Penn National Gaming.
The business then $1.27bn in operating expenses, however, a 20.2% increase.
This included $686.6m in gaming expenses, up 30.1%, as well as $171.9m in foot and beverage expenses, up 39.8%.
Depreciation and amortisation costs also grew, by 45.4% to $118.2m, but general and administrative costs were down by 6.4% to $395.5m.
As a result of these costs, Penn’s operating income was up 34.9% to $292.0m.
The business then paid $160.8m in interest expenses, up 18.5%, while it made $8.7m from businesses in which it does not hold a controlling stake, down 9.4% from 2021.
However, it also incurred $40.7m in other costs, which included expenses related to the acquisition of theScore as well as costs of implementing a new resource management system. In Q1 of 2021, Penn had recorded $21.1m in other income instead.
This meant that Penn’s pre-tax income came to $99.2m, down 11.1% from 2021.
After paying $51.6m in tax, the business reported a final profit of $51.6m, which was 43.3% less than in 2021.
The business also recorded earnings before interest, tax, depreciation and amortisation (EBITDA) of $434.6 million, an increase of 29.1% year-on-year.
After the quarter ended, Penn launched its theScore brand in Ontario’s newly opened betting and igaming market. The business also made progress on migrating its sports betting product from Kambi to a new platform being built by theScore, as announced when it agreed the acquisition.
“Although early, we have been very encouraged by the results,” Snowden said.“ In Q3 2022, we expect to transition theScore Bet in Ontario to theScore’s proprietary risk and trading platform, which will allow us to significantly bolster the product’s features and capabilities, including expanded betting markets and exclusive bet features.
“We also remain on track to transition the Barstool Sportsbook to theScore’s PAM and trading platform in Q3 2023, which will provide meaningful cost and revenue synergy opportunities.”
Following these strong results, the business raised its full-year revenue guidance for 2022 to fall between $6.15bn and $6.55bn. It also raised its 2022 earnings before interest, tax, depreciation, amortisation and restructuring (EBITDAR) guidance, to between $1.88bn and $2.00bn.