Penn Has Limited Control Over Spending
Penn National Gaming (PENN: 24.91 0.00%) posted lower than expected fourth quarter financials and suggested analysts 2010 forecasts are over inflated, as consumers continue to spend less in the casinos.
“We have limited control over how consumers are continuing to respond to economic pressures and as a result, the gaming industry experienced revenue compression again in the fourth quarter,” Chairman and CEO Peter Carlino said.
Penn posted revenue down 2.7% to $555.8 million with the bulk coming from gambling revenue which fell 2.8% and food and beverage revenue which also fell 1.5%.
The company reported a net loss of $355.4 million or $4.54 per share. Stock compensation charges and impairment cost totaled $478.8 million for the quarter, compared to 2008’s fourth quarter net loss of $378.6 million and slightly higher charges of $497.8 million.
Operating earnings came in at $0.11 per share, which fell short of Wall Streets prediction of $0.18 per share.
Wall Street Analyst are forecasting 2010 revenue of $2.52 billion and earnings per share of $1.39, however Penn predicts 2010 revenue to come in at only $2.43 billion and adjusted earnings per share of $1.00.
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