- Regional casino operator will commence buyback plan in coming weeks
- Could be in the millions of dollars
Perhaps signaling to investors it sees value in its battered stock, Century Casinos (NASDAQ: CNTY) announced today it will soon commence a share repurchase program.
Co-CEO Peter Hoetzinger made the announcement on the gaming company’s first-quarter earnings conference call earlier today, noting the regional casino operator could imminently commence buying back its stock.
The current environment is a little less certain than it was maybe a quarter ago, so we will be cautious, but we believe CNTY is the best casino investment with the highest growth potential out there,” said Hoetzinger on the call. “Hence, we plan to buy back stock in the coming weeks.”
In a departure from what’s typically seen in the gaming industry and across Corporate America, Century Casinos did not reveal the size of its buyback plan, but Hoetzinger did say it would be in the “single-digit million dollar value.” Companies aren’t obligated to say how much of their shares they’ll buy back when repurchase plans are announced nor are they bound to buy back the entirety of an announced dollar amount.
Good Time for Century Casinos to Buy Back Stock
It’s arguably curious as to why Century didn’t more broadly publicize its share repurchase plan because investors have been clamoring for management to show some signs of faith in the beleaguered shares with some previously demanding that executives buy more stock themselves.
Still, news of the buyback can be seen as positive because the gaming company won’t be committing one of the cardinal sins of repurchase programs: buying the stock at inflated prices. The stock has tumbled 52.12% over the past 90 days and 62% over the past month, indicating will be getting favorable prices should it soon start repurchasing its shares. That appears to be the plan.
“We think we’ll start between now and our next earnings release in early August,” added Hoetzinger.
Century concluded the first quarter with $85 million in cash and cash equivalents, confirming it has the firepower with which to buy back its stock. As noted above, the company didn’t reveal a dollar amount of the repurchase program, but even it bought back just $3 million worth of its shares — a hypothetical scenario, not a figure discussed by the company — it’d significantly reduce its shares outstanding tally of 30.68 million.
Century Still Mulling Poland Asset Sales
One of the long-running questions pertaining to Century is when it will divest its two-thirds interest in Casinos Poland — a plan that’s been stymied by Russia’s invasion of Ukraine. Hoetzinger said the company still plans to sell its Poland operations.
“We are still committed to divesting our Poland operations. Two newly interested parties have surfaced recently, and discussions with our minority partner are also going well for potential sale of 100% of the company,” said the co-chief executive officer.
Those parties weren’t identified. The executive added that while Casinos Poland doesn’t currently offer sports betting, the country allows commercial operators to do business in that space and “some of the companies that have expressed interest in our casinos there come from the sports betting side.”
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