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The Barstool Effect: Penn National Rebrands With Larger Focus On Media, Non-Casino Business

Casino, sports betting and media company Penn National Gaming PENN announced second quarter financial results before the market opened Thursday.

The Wyomissing, Pennsylvania-based company also announced a new name to better align with its future growth, following acquisitions of theScore and a partial stake in the Barstool Sports brand.

What Happened: Penn National reported for the second quarter:

  • Revenue of $1.6 billion; That’s up 5.2% year-over-year.
  • The revenue total came in ahead of a Street estimate of $1.61 billion according to data from Benzinga Pro.
  • Net income of $26.1 million and earnings per share of 15 cents.
  • Adjusted EBITDAR (earnings before interest, taxes, depreciation, amortization, and restructuring) was $504.5 million — down 14% year-over-year.
  • A buyback of $167 million shares of its stock at an average price of $30.16 in the second quarter.

“We are pleased with our second quarter results,” Penn CEO Jay Snowden said. “Despite economic headwinds, we delivered consistent performance across our retail portfolio in the quarter and into July.”

Revenue for the company’s interactive segment, which includes sports betting and iCasino, had revenue of $154.9 million in the second quarter.

“Penn Game Studios continues to develop engaging Barstool branded content for our Barstool iCasnio app.”

The company transitioned its theScore Bet in Ontario to its own proprietary technology stack. Penn plans to transition its Barstool Sportsbook to its own tech stack in the third quarter of 2023. The company called its pipeline of iCasino content for Barstool and theScore “robust.”

“Our media businesses delivered strong growth this quarter relative to the first quarter of 2022, with theScore’s media revenue growing 11% year-over-year and monthly sessions increasing 20%.”

The company said the Barstool Sports brand increased its social media reach in the second quarter and is set up for increasing cross-sell and “new monetization opportunities.”

Penn has gained over 1.2 million registrations to its mychoice database over the last four quarters, which the company believes will help with future growth.

Related Link: Penn National CEO Says Barstool Sports, theScore Will Be The Most Powerful Combination In This Space

What’s Next: Penn National is reiterating its full fiscal year 2022 revenue guidance of $6.15 billion to $6.55 billion. Benzinga Pro data shows analysts are targeting $6.36 billion for the full fiscal year.

Along with second quarter financial results, the company also announced it will change its name to Penn Entertainment, to better align with its offerings.

“Today is an exciting day for us as we become Penn Entertainment Inc.,” Snowden said. “Over the past few years, Penn has transformed our business through a highly differentiated strategy focused on organic cross-sell opportunities, which is reinforced by our investments in market-leading retail casinos, sports media assets, owned technology, including state-of-the-art, fully integrated digital sports and online casino bettering platform, and an in-house iCasino content studio.”

The CEO said the new name will help reflect the company’s evolution into being North America’s “leading provider of integrated entertainment, sports content and casino gaming experiences.”

Since the end of the second quarter, the company has bought back an additional $95 million of its shares at an average price of $31.46.

Penn also has the option to acquire the remainder of Barstool Sports, something it previously said it would do in 2023.

PENN Price Action: Penn shares are down 2% to $36 on Thursday versus a 52-week trading range of $26.46 to $53.36.

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