Caesars Entertainment Corporation (CZR) saw its loss widen to $546 million, or $3.71 a share for the quarter ended Mar. 31, 2017. In the previous year period, the company reported a loss of $308 million, or $2.12 a share. Revenue during the quarter went up marginally by 1.37 percent to $963 million from $950 million in the previous year period. Gross margin for the quarter expanded 41 basis points over the previous year period to 54.41 percent. Total expenses were 83.59 percent of quarterly revenues, down from 90.74 percent for the same period last year. This has led to an improvement of 714 basis points in operating margin to 16.41 percent.
Operating income for the quarter was $158 million, compared with $88 million in the previous year period.
However, the adjusted EBITDA for the quarter stood at $274 million compared with $261 million in the prior year period. At the same time, adjusted EBITDA margin improved 98 basis points in the quarter to 28.45 percent from 27.47 percent in the last year period.
“Caesars Entertainment delivered another quarter of successful execution, highlighted by strong growth in hotel revenues fueled by a double-digit percentage increase in Las Vegas Cash ADR. These gains reflect the positive impact of our investments in property renovations,” said Mark Frissora, president and chief executive officer of Caesars Entertainment. “Rising hotel revenues combined with increased operating efficiency drove higher EBITDA and supported our continued margin expansion. The conclusion of CEOC’s restructuring is on track for the second half of the third quarter and represents an important milestone that will allow us to expand the range of growth opportunities available to us.”
Operating cash flow improves significantly
Caesars Entertainment Corporation has generated cash of $125 million from operating activities during the quarter, up 95.31 percent or $61 million, when compared with the last year period. The company has spent $83 million cash to meet investing activities during the quarter as against cash inflow of $40 million in the last year period.
The company has spent $73 million cash to carry out financing activities during the quarter as against cash outgo of $80 million in the last year period.
Cash and cash equivalents stood at $1,454 million as on Mar. 31, 2017, up 2.76 percent or $39 million from $1,415 million on Mar. 31, 2016.
Working capital remains negative
Working capital of Caesars Entertainment Corporation was negative $3,266 million on Mar. 31, 2017 compared with negative $322 million on Mar. 31, 2016. Current ratio was at 0.60 as on Mar. 31, 2017, down from 0.85 on Mar. 31, 2016.
Days sales outstanding went down to 11 days for the quarter compared with 20 days for the same period last year.
Debt comes down marginally
Caesars Entertainment Corporation has recorded a decline in total debt over the last one year. It stood at $6,789 million as on Mar. 31, 2017, down 1.89 percent or $131 million from $6,920 million on Mar. 31, 2016. Total debt was 45.83 percent of total assets as on Mar. 31, 2017, compared with 57 percent on Mar. 31, 2016. Interest coverage ratio improved to 1.07 for the quarter from 0.58 for the same period last year.
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