Strong Social and Mobile Growth Drives CIE Revenues Up 95 Percent in Q2
Caesars Entertainment Corp has been under fire for its “restructuring” model which is aimed at reducing their massive debts. The creation of an additional subsidiary Caesars Growth partners (CGP) has led to legal battles by creditors and investors who are looking to recoup some of the estimated $23 billion owed to them. The basic theory is that Caesar put all their worthwhile assets under the CGP while leaving all the debt ridden assets under the Caesars Entertainment Operating Co.(CEOC).
With this in mind the Q2 results have been released and once again the division shining for Caesars is Caesar interactive Entertainment. Following their 82 percent increase in revenues for Q1 this year CIE recorded $144.6m for Q2 in revenue which is an increase of 95.4% year-on-year. CIE has recently united all their Playtika brands under one roof. Due to their aggressive acquisition of social gaming companies like Pacific Interactive CIE have recorded an operating loss of $20.5m. CIE’s real money online gaming operations in New Jersey and Nevada recorded a 20% quarterly gain to reach $10.2m. Social and mobile games revenues were up 90 percent as paying users grew to over 500,000 and average revenue per user was up to $0.26 which was up from $0.24 in the previous quarter.
The other figures for Caesars Entertainment were not good. The struggling Atlantic City markets added to their widening Q2 loss which was more than double for the prior year. Their revenue in Q2 fell 1.9% year-on-year to $1.38n. Their Q2 operating expenses rose 4.5% to $2.08b while internet expenses rose 21% to $653m. Caesars is still struggling to record a profitable year and since 2008 this has only occurred once. They are facing growing challenges in the somewhat stagnant U.S. gambling market along with their hefty $23 billion long-term debt.