Q3 2024 Accel Entertainment Inc Earnings Call Transcript
Key Points
- Accel Entertainment Inc (ACEL) reported strong financial performance with Q3 2024 revenue of $302 million and adjusted EBITDA of $46 million, showcasing resilience in their local gaming offering.
- The company made significant progress in its pending acquisition of Fairmont Park, expected to close in early December, which includes a master sports betting license and partnership with Fanduel.
- Accel Entertainment Inc (ACEL) demonstrated growth in its largest market, Illinois, with a 5% year-over-year increase in market-wide GGR, outperforming Illinois casinos.
- The company is optimizing its operations by strategically closing underperforming locations and focusing on high-performing sites, which is expected to enhance returns on invested capital.
- Accel Entertainment Inc (ACEL) is actively pursuing growth opportunities through M&A, with a focus on acquiring establishments in markets where it is profitable and preparing for future opportunities in new states likely to legalize local gaming.
- The company faced a modest drag from recent tax increases in Illinois, impacting profitability and prompting strategic closures of underperforming locations.
- Sequential decline in location count in Illinois due to strategic closures and delays in openings caused by the cancellation of a gaming board meeting.
- The introduction of new gaming terminals led to elevated capital expenditures, with projected CapEx for 2024 between $60 million and $65 million, although expected to decrease in the longer term.
- The acquisition of Fairmont Park involves significant capital investment, with the project expected to cost between $20 million and $25 million over the next couple of years.
- The company faces challenges in the M&A market, with a narrowing bid-ask differential and the need to overcome hurdles with potential targets to reach agreements.
Good afternoon and thank you for joining the Accel Entertainment Q3 2024 Earnings Call. My name is Kate and I will be the moderator for today's call. (Operator Instructions)
I would now like to turn the call over to Derek Harmer, General Counsel and Chief Compliance Officer. Derek. You may Proceed.
Proceed. Welcome to Accel Entertainment's third-quarter 2024 Earnings Call. Participating on the call today are Andrew Rubenstein, Accel's Chief Executive Officer; Mathew Ellis, Accel's Chief Financial Officer; and Mark Phelan, Accel's President of US Gaming.
Please refer to our website for the press release and supplemental information that will be discussed on this call. Today's call is being recorded and will be available on our website under events and presentations within the investor relations section of our website.
Some of the comments in today's call may constitute forward-looking statements within the meaning of the Private Securities Reform Act of
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