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Penn National Gaming, Inc. (PENN)
Q3 2010 Earnings Call
October 21, 2010 10:00 am ET
Joe Jaffoni - IR
Peter Carlino - Chairman & CEO
Tim Wilmott - President & COO
Bill Clifford - CFO
Eric Schippers - VP of Public Affairs
Steve Snyder - SVP, Corporate Development
Jordan Savitch - SVP and General Counsel
Joe Greff - JPMorgan
Felicia Hendrix - Barclays Capital
Larry Klatzkin - Chapdelaine
David Katz - Jefferies & company
Steve Wieczynski - Stifel Nicolaus
Ryan Anchor - Affiliated Research
Joel Simkins - Credit Suisse
Steven Ruggiero - CRT Capital
Carlo Santarelli - Wells Fargo
Bill Lerner - Union Gaming
Mark Strawn - Morgan Stanley
Neil Portis - Goldman Sachs
Harry Curits - Nomura Securities
Adam Steinberg - Maryman Capital
Previous Statements by PENN
» Penn National Gaming, Inc. Q2 2010 Earnings Call Transcript
» Penn National Gaming, Inc. Q1 2010 Earnings Call Transcript
» Penn National Gaming Inc. Q4 2009 Earnings Call Transcript
It is now my pleasure to introduce Mr. Joe Jaffoni, Investor Relations. You may proceed, sir.
Thank you, Francis, and good morning everyone, and thank you for joining Penn National Gaming's 2010 third quarter conference call. We'll get to management's presentation and comments momentarily as well as your questions and answers, but first I'll review the Safe Harbor disclosure.
In addition to historical facts or statements of current conditions, today's conference call contains forward-looking statements that involve risks and uncertainties within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements reflect the company's current expectations and beliefs, but are not guarantees of future performance. As such, actual results can vary materially from expectations.
The risks and uncertainties associated with the forward-looking statements are described in today's news announcement and in the company's filings with the Securities and Exchange Commission, including the company's reports on Form 10-K and Form 10-Q. Penn National Gaming assumes no obligation to publicly update or revise any forward-looking statements.
Today's call and webcast may also include non-GAAP financial measures within the meaning of SEC Regulation G. When required, a reconciliation of all non-GAAP financial measures to the most directly comparable financial measures calculated and presented in accordance with GAAP can be found in today's news announcement as well as on the company's website.
With that, I will turn the call over to Peter Carlino, the company's Chairman and CEO. Peter?
Thank you, Joe. Well good morning, everyone and welcome. Here with me today as usual is most of our management team and you will be hearing from probably most of them through the course of our presentation. You know it's been interesting and event full quarter for us. You know we open table games at Charles town. We opened table games at Penn National. We opened a brand new facility in Perryville, Maryland. We announced the establishment of a joint venture with the Sam Houston Race Park in Houston. We broke ground in Toledo. We have made significant progress with our construction Kansas City. We have made great progress in our site preparation in Columbus which started with raising a 1.2 million square foot building that had a lot of environmental issues, and that's moving along very, very well. We purchased the outstanding debt at M. So there are a whole lot of things to talk about today. And as usual why don't we move quickly to your questions and go where you'd like us to go. So operator would you open the call to questions?
Thank you. (Operator Instructions). Our first question is from the line of Joe Greff from JPMorgan. You may proceed.
Joe Greff - JPMorgan
Good morning, everybody. Peter, in the quarter that one thing that nicely surprised us to the upside at Pennsylvania, West Virginia wasn't as much on the revenue but really on the margins. Can you talk about that? I know obviously there's a difference of gaming tax rate on the table side. Can you just discuss that margin improvement and then typically I would think we would expect to see maybe with time, margin improve from here. Do you think margins can improve from Pennsylvania and West Virginia from what we saw in the third quarter? That's my first question.
The second question is can you talk about M a little bit and the timeline and the gaming issues in order for you to close? Maybe you can talk a little bit if you can about sort of the operating structure there, what can you take out? And then, if there is a rebranding effort there, how much dollars that would cost? And maybe just generally just talk about what you can do different or better at that property?
If I answer all that there would be nothing left for anybody else.
Joe Greff - JPMorgan
I will e-mail you the questions
Well let me give you a partial answer on number two just so we save some room for others. But on the margin question I'll have Tim address this more specifically. Look you understand that we are always focused on the bottom line. Its always less critical if we love top-line volume, but in the end its how much you drop to the bottom line. And there are certainly a lot of instances in our industry where we see, some pretty fancy properties doing nice numbers but not making any money; that is not our model. So I'll get that commercial in because that is what drives us here day in and day out. Tim, why don't you get to the specifics?