Empire Resorts loses $26.4M in Q3, improves year-over-year

Empire Resorts, parent company of Resorts World Catskills casino in Sullivan County, recorded a third-quarter loss of $26.4 million on revenue of $69.5 million and operating costs of $79.2 million, according to new financial filings.

The results represent significant improvement for the company, which owns the Town of Thompson casino and the Monticello Raceway harness race track, compared with the same July-September period in 2018. During last year’s third quarter, Empire saw a loss of $33.7 million on revenue of $59.9 million and operating costs of $77.8 million, as reported by The Times Herald-Record.

For this year’s third quarter, Empire reported total gross gaming revenue of $60.9 million for slots ($33.3 million) and table games ($27.6 million), according to state filings. That’s up nearly 39 percent, compared with the same period in 2018, when Empire grossed approximately $43.9 million, including roughly $23.8 million for slots and about $20.1 million for table games.

However, the $26.4 million loss in Thursday’s earnings report means that Empire has lost roughly $238 million since the casino’s February 2018 opening. The company has stayed afloat only via borrowing from banks and proceeds from the issuance of debt and equity securities, including from the company’s largest shareholder, casino magnate K.T. Lim’s family trust Kien Huat Realty III Ltd. Empire’s long-term debt currently stands at nearly $484 million.

On August 18, Empire entered into a merger agreement with the holding company Hercules Topco LLC and its subsidiary. The holding company is a joint venture between Kien Huat and Genting Malaysia Berhard, a publicly traded, transnational gaming company that Kien Huat partially owns and controls.

Lim had accumulated more than 86 percent of Empire’s stock, which is traded on the Nasdaq exchange, after buying it up beginning in 2009 to rescue the company from bankruptcy. But, in recent months, Lim has put all of his family trust’s stock into Hercules Topco, while steering Genting Malaysia to buy up much of his family’s holdings. Last week, Genting Malaysia bought 13.2 million shares, for $128.6 million, of the Lim trust’s stock.

On Wednesday, Empire shareholders will vote on Lim’s second effort to save Empire, this time from the potential bankruptcy the company has warned that it’s headed toward. Empire’s shareholders will vote on Kien Huat and Genting Malaysia’s August offer of $9.74 per share of common stock. If approved by a majority of the company’s shareholders, the merger is expected to close before the end of 2019.