Casino and track owner Penn National Gaming Inc. reported a spike in income from operations in announcing financial results July 26 for the three months ended June 30. CEO Timothy J. Wilmott said nearly two-third of its properties enjoyed growth in the quarter.

“Penn National delivered another strong quarter in which we exceeded our guidance for income from operations and adjusted EBITDA,” Wilmott said. “Our solid second quarter results are largely attributable to same store revenue growth at nearly two-thirds of our gaming operations and the continued success of our ongoing margin enhancement initiatives. As a result, all three of the company’s operating segments generated year-over-year adjusted EBITDA growth. Our margin enhancement initiatives, which began last October, continue to yield results, with ongoing focus on procurement, marketing and labor.”

Some 2018 second quarter financial highlights include:
•    Net revenues of $826.9 million;
•    Income from operations of $181.8 million, up 34.6%;
•    Adjusted EBITDA of $247.1 million, up 8.7%;
•    Adjusted EBITDA after Master Lease payments of $131.2 million, up 15.7%;
•    Adjusted EBITDA margins increased by 133 basis points to 29.88%, with 18 of 23 gaming operations delivering improved margins; and
•    Reduced traditional debt by over $120 million. Traditional net debt ratio declined to 1.94x from 2.25x and gross and net leverage inclusive of master lease obligations declined to 5.21x and 4.99x, respectively, from 5.45x and 5.20x at March 31, 2018.

Wilmott also updated investors on regulatory approvals involved in PNGI’s purchase of Pinnacle Entertainment.

“Last week we secured approvals from the Ohio Casino Control Commission and the Louisiana Gaming Control Board, subject to customary conditions, in connection with our pending acquisition of Pinnacle Entertainment,” Wilmott said. “Penn National had previously received approvals from six other gaming regulatory bodies, subject to customary conditions, including: the Pennsylvania Gaming Control Board and the Pennsylvania Racing Commission; the West Virginia Lottery Commission; the Illinois Gaming Control Board, the Mississippi Gaming Commission; and the Indiana Gaming Commission. In addition, on March 29, shareholders of both Penn National and Pinnacle approved the proposed merger, with over 99% of all votes cast in favor of the transaction.

“Over the last several months, we have worked diligently with Pinnacle’s leadership to better understand the company’s culture and processes and engaged with leaders and team members from all corporate functions. With that knowledge, we have developed a new corporate organizational structure that blends proven leaders from both Penn National and Pinnacle, while maintaining our corporate headquarters in Wyomissing, Pa., and retaining a significant corporate presence at Pinnacle’s Las Vegas-based Service Center.

“Based on our progress to date in terms of regulatory approvals and transition planning, we anticipate closing the transaction in early fourth quarter. In addition, we remain confident our $100 million of cost synergy objectives are well within reach.”