💥All Fun and Games Until...💥
New Coverage: Full House Resorts, Inc. ($FLL) + Century Casinos, Inc. ($CNTY)
Oh don’t you worry. We’ll have plenty of things to say about (i) the latest and greatest retailer to take a whirl around the bankruptcy bin (West Marine Inc.) as well as (ii) coverage of one of the dumbest f*cking businesses we’ve seen in a while (Bitcoin Depot Inc.). But first we’re going to spend today delving into two gaming situations that have been losing quite a lot lately.
⏩One to Watch: Full House Resorts, Inc. ($FLL)⏩
Las Vegas-based Full House Resorts, Inc. ($FLL) (the “company”) owns and operates fives casinos — two in Cripple Creek, CO and one in each of Rising Sun, IN; Bay St. Louis, MS; and Waukegan, IL — and doesn’t own but operates one in Incline Village, NV.
Yeah, these are not “prime” locales. An hour outside of Colorado Springs (two from Denver), an hour outside of Cincinnati (two from Indy), an hour outside of New Orleans, an hour outside of Chicago. At least that last one is (redeemably?) on Lake Tahoe, 🤷♀️?
The locations are not the problem, however. The company has always been an owner/operator of regional sites. It’s what they’ve chosen to do on ‘em.
For instance, the company acquired Bronco Billy’s Casino and Hotel in Cripple Creek in ‘16. As the name suggests, it ain’t upscale — it’s Western/gold-mining themed. That doesn’t attract the high-end clientele the company wants to bag, so it made a call.
No, it didn’t put Billy’s out to pasture. Instead, in ‘18, the company began designing a new casino for Cripple Creek — the very French-sounding Chamonix, “… a new, distinct, luxury hotel and casino …” with 180 rooms.
Where did it decide to place this luxurious facility? See for yourself:
Right next door to the cowpoke casino.
Ahhhhh, just the atmosphere high-rollers are looking for!”*
The company even doubled down on the strategy. After Colorado loosened its gambling laws, it upped the number of rooms it was constructing by 67% (to 300). To kick off the build, in February ‘21, the company issued $310mm in 8.25% senior secured notes due February ‘28 (the “secured notes”) to fund a $180mm reserve account, upped a year later to $221mm, as well as refinance the entirety of a prior, ~$106.8mm issuance (for which the company had to pony up a 0.9% premium), and after several years, the Chamonix completed its phased opening in October ‘24.
Meanwhile, the company set its eyes east. In October ‘19, it submitted a proposal to the Illinois Gaming Board (the “IGB”) to open the Waukegan casino (dubiously-named American Place), and after having been hampered by COVID, the IGB selected it in December ‘21.** Time to get building?
Yes, but not how you’re thinking. The company knew that constructing a permanent location would take years, so it opted to issue another $100mm in secured notes in February ‘22 to fund development of a temporary casino. Another spin around the globe, and in February ‘23, another $40mm of secured notes found their way onto the balance sheet to actually open it and pay Illinois its due for a gaming license.
As for the permanent casino? It’s been three years, after all. Here’s CEO Daniel Lee on the May 7, 2026 earnings call:
“… I think it’s going to be an exciting quarter because we’re going to get under construction …”
Have been, are, and will be. Per CFO Lewis Fanger on the same call:
“By starting now, we hope to open the permanent American Place about two years from now.”
Why the “hope”? Back to Mr. Fanger:
“We’ve been very transparent about our efforts to fund the permanent American Place Casino, as well as refinance our existing debt. If you recall, we mentioned on our last earnings call that we’ve been working with a funding source that has prepared to fully fund construction of the permanent American Place casino. We have funded the gaming license, land, slot machines, temporary casino, assembly of the workforce, the mailing list, all at a total investment today of about $170 million. The new financing will provide the approximately $300 million needed to move into the permanent facility.”
While he wouldn’t name the funding source, he’s “… confident enough …” the company will get there in the next few weeks, so they’re dropping bulldozers onto the site.
On the same call, the company disclosed that the Chamonix’s 300 hotel rooms sat at ~41% occupancy, and it and and Billy ain’t pulling their weight. Per the company’s most recent 10-K:
“For the year ended December 31, 2025, we generated 41.0% of our revenues and 71.2% of our Adjusted EBITDA from our casino in Illinois. Similarly, we generated 23.2% of our revenues and 24.1% of our Adjusted EBITDA from our casino resort in Mississippi.”
Meanwhile, the entire “West” segment — which is composed of the Cripple Creek spots and the Lake Tahoe operation — came in at 21% of revenue (~$63.6mm) and … uh … well … burned cash. Operationally. Its EBITDA was (~$2.4mm).
Anyway, these are the company’s consolidated (and growing!) revenue figures 👇 …
… which are not at all reflected in its very-stagnant adjusted EBITDA 👇 …
FY’26 isn’t off to a phenomenal start either. On May 7, 2026, the company released 1Q’26 results, and while there are bright (less dim?) spots — adjusted EBITDA rose YoY to $13.2mm from $11.5mm (14.7% ⬆️) and the company’s net loss was ($8.2mm) compared to ($9.8mm) a year earlier — EPS missed on the consensus forecast of ($0.19), landing at ($0.23), as did revenue ($74.4mm vs. a forecast of $79.1mm).***
There’s also the obvious issue of the company’s $480mm debt profile, composed of the $450mm in secured notes and another $30mm under a revolver due August ‘27**** with Capital One, N.A. After deducting the company’s ~$31.4mm in cash (as of March 31, 2026), you arrive at a net debt to EBITDA ratio today of ~9.3 …
… before tacking on any financing to construct the permanent American Place.
Obviously, the leverage is already reflected in the stock price, which has fallen precipitously in recent years:
S&P Global isn’t hot on the company either. In November ‘25, it downgraded the biz from B- to CCC+, citing natural refinancing concerns and the ambition to pile on more debt.*****
Apparently an anonymous funding source is keen though, and the market is exhibiting some patience: the stock is flat-to-up-ever-so-slightly over the last month.
We, for one, can’t wait to find out who the source is while bulldozers get to work in northern Illinois.
*Luxury that Bronco Billy’s own patrons got to enjoy too. The Chamonix was built on what had been its parking lot, meaning folks lost easy access to the casino, and during the build, Bronco Billy’s hotel rooms were shut down too. Unsurprisingly, it performed materially worse during that time.
**Notably, the West segment’s adjusted segment EBITDA rose significantly YoY. 28.3%, which, uh, means that instead of losing $2.5mm, it … 🤦♀️… lost $1.8mm.
***A decision that sparked controversy. Another proposer sued.
****Via several amendments, the most recent of which was in March ‘26, to kick out the maturity date. The OG date had been March ‘26.
*****S&P also noted the potential for issues in extending the company’s temporary Illinois license, but that seems less an issue today. As of writing, there’s a bill sitting in the IL legislature waiting to be voted on. Notably, Moody’s has the company sitting at Caa1.
⏩One to Watch: Century Casinos, Inc. ($CNTY)⏩
Colorado Springs-based Century Casinos, Inc. ($CNTY) (the “company”) owns and operates eleven “… regional mid-size casinos… ” — and related lodging, restaurant, horse racing, golf, and entertainment facilities — in the US (seven)* and Canada (four)** and is a ~67% equity holder in Casinos Poland (“CPL”), a Polish endeavor with six casinos under its belt.
Founded in ‘92, the company acquired its first casino in Cripple Creek, CO in ‘96 (which remained its sole location until ‘06). That year, the company expanded by opening a second spot in Colorado and its first in Alberta, Canada. The next year, it opened up in Europe by purchasing a 33.3% interest in CPL, which the company increased to 66.6% in ‘13.
Then the acquisitions continued through the mid-’10s, culminating in the December ‘19 purchase of the operations of two Missouri casinos (in Cape Girardeau and Caruthersville) and one West Virginia casino for ~$107mm.
That moment marks when a sh*tload of debt crept onto the balance sheet. Prior to the deal, the company carried ~$52mm under a Bank of Montreal ($BMO) credit agreement, but to fund the three-casino purchase and retire BMO’s debt, the company borrowed ~$170mm under a facility agented by Macquarie Capital Funding LLC (“Macquarie”). Concurrently, VICI Properties Inc. ($VICI)*** stepped in and bought the three underlying casinos’ real estate, which it triple-net leased to the company.****
Founders and co-CEOs Erwin Haitzmann and Peter Hoetzinger looked west. In April ‘22, the company entered into a $350mm term loan and revolving facility (the “credit facility”) agented by Goldman Sachs Bank USA ($GS) to finance the company’s ~$195mm acquisition of the Nugget Casino (“Nugget”) in Reno, NV***** and pay off the Macquarie facility.******
Following that, (i) in December ‘22, the company and VICI amended the master lease for VICI to finance improvements to the Caruthersville casino and increasing annual rent by ~$4.2mm, (ii) in July ‘23, the company expanded in Maryland by purchasing the Rocky Gap Casino (“Rocky Gap”) in Maryland for ~$56.1mm, with VICI again picking up the underlying real estate and increasing overall annual rent by $15.5mm, and (iii) in September ‘23, VICI purchased the company’s Canadian real estate for ~$162.4mm, and said real estate was then added to the lease too, which increased annual rent by yet another ~$12.7mm.
You know what’s coming next. Debt service and rent got …
In fact, it’s eaten more and more of the company’s EBITDA every single year. See for yourself 👇.
Unaided by neither the Nugget nor Rocky Gap performing close to expectations. Per the company’s amended FY’24 10-K:
“On July 30, 2024, we announced we were replacing the management team at the Nugget. During the annual forecast process that began in mid-fourth quarter 2024, the new management team revised the future operating results assumptions due to revised future performance expectations based on estimated future market conditions and analysis of the property’s sustained decrease in performance since its acquisition. As a result, we impaired goodwill at the Nugget based on these updated assumptions. In the fourth quarter of 2024, we impaired $43.7 million related to goodwill at the Nugget…
During the annual forecast process that began mid-fourth quarter 2024, the management team at Rocky Gap revised the future operating results assumptions due to delays in the execution of the planned player engagement strategy. As a result of the updated forecast and the corrected calculation of the carrying value of invested capital calculation, goodwill related to Rocky Gap was concluded to be impaired during the fourth quarter of the year ended December 31, 2024. As a result, we recorded an impairment of $26.5 million related to goodwill at Rocky Gap.”
Which, btw, was 100% of the company’s US-based goodwill.
Everybody noticed.
This chart speaks for itself:
Ratings agencies spoke up too. On August 22, 2024, S&P Global downgraded the company to B- from B, citing, among other things, “… operating challenges at the Nugget Casino Resort [and] construction disruptions at some of its U.S. properties …” In February ‘25, Moody’s followed suit, lowering the company from B3 to Caa1.
Anyway, here’s a tune we’ve heard a thousand times before: the company is trying to turn it around. In August ‘25, it announced it was exploring “… a range of potential strategic alternatives …” to unlock value, which apparently includes partnering up with BetMGM in December ‘25 to open a retail sports book at its Cape Girardeau casino.
Doesn’t knock your socks off? Don’t worry, the company ain’t done. Per its March ‘26 FY’25 press release:
“We continue to make progress with robust discussions around strategic alternatives, including the sale of our operations in Poland.”
Why? Licensing issues in the country — although the company is good through ‘28 — and, of course, a focus on paying down debt.
The company is optimistic about that prospect. Here’s CFO Margaret Stapleton on the March ‘26 earnings call:
“We are a couple of weeks away from the end of the first quarter, and we are really excited about our progress on all fronts. Net operating revenue and adjusted EBITDA are up significantly compared to last year. Every single property in the U.S. and Canada is showing double-digit EBITDA growth …”
Exciting.
Not a fib either. On May 8, 2026, the company released its 1Q’26 results, and net operating revenue grew 5.2% YOY to $137.2mm, while adjusted EBITDAR rose an aggregate 23.7% … from ~$20.2mm to $24.9mm.
But the damn debt and leases. For the same quarter, interest and rent expense clocked in at $25.9mm and the company’s net loss on the quarter hurt to the tune of ~$14.8mm.
Disappointing … and explains this: the same day, the company canned EVPs Andreas Terler (US ops) and Nikolaus Strohriegel (Canadian and Euro ops). A few days later, on May 13, the company promoted Lyle Randolph, a 30+-year industry vet and company VP, to the former role.
Reshuffling here makes sense. The company needs real growth to climb out of the hole, and its term loan lenders sure as sh*t ain’t happy. Last time we checked the loan was quoted at ~67 cents, down, 😔, from ~78 cents at the end of March ‘26 but up quite a bit from the 50s level it touched in April. On April 29, 2026, the company and credit facility-lender Brigade Capital Management, LP (“Brigade”) entered into a standstill agreement, under which gaming-executive Mitchell Etess was placed onto the company’s board and Brigade agreed (i) not to f*ck around with the business and (ii) under a side letter, to tender up to $50mm of its holdings under the credit facility in a Dutch action at an agreed discount should the company ever choose — or be forced — to go that route.
*One in West Virginia, one in Maryland, two in Missouri, two in Colorado, and one in Nevada.
**All four in Alberta, one of which is only 75% owned by the company.
***For the more vintage of you, VICI PropCo is the real estate entity that emerged from the ‘15 Caesars Entertainment Operating Co. chapter 11 bankruptcies.
****The master lease is accounted for on the company’s financials as a failed sale-leaseback.
*****More specifically, the company purchased 100% of Nugget Sparks, LLC, the Nugget’s operator, and 50% of Smooth Bourbon, LLC, the Nugget’s landlord.
******The term loan, which has ~$332.5mm outstanding as of March 31, 2026, and revolver, which is untapped, will mature in April ‘29 and April ‘27, respectively. The TL bears interest at SOFR + 6% or an alternate base rate (“ABR”) + 5%, whichever the company elects, and requires an $875k quarterly fee. The revolver’s interest rate varies depending on the company’s First Lien Net Leverage Ratio, but can vary between a SOFR or ABR + a 3.75% – 5.25% margin.
📚Resources📚
We have compiled a list of a$$-kicking resources on the topics of restructuring, tech, finance, investing, and disruption. 💥You can find it here💥.
📤 Notice📤
April Doxey (Partner) joined Willkie Farr & Gallagher LLP from Winston & Strawn LLP.
Gregory Gartland (Partner) joined Willkie Farr & Gallagher LLP from Winston & Strawn LLP.
Jennifer Meyerowitz (Senior Managing Director and General Counsel) joined KCP Advisory Group from SAK Healthcare.
Jordan Elkin (Partner) joined Simpson Thacher & Bartlett LLP from Kirkland & Ellis LLP.
Josh Sturm (Partner) joined Proskauer Rose LLP from Davis Polk & Wardwell LLP.
Maggie Burrus (Partner) joined Stinson LLP from Weil Gotshal & Manges LLP.
Matthew Roose (Partner) joined Gibson Dunn & Crutcher LLP from “another large international law firm,” lol.
Nikita Kumar (Partner) joined Willkie Farr & Gallagher LLP from Simpson Thacher & Bartlett LLP.
🍾Congratulations to…🍾
Fox Rothschild LLP (Joseph DiPasquale, Michael Herz, Agostino Zammiello, William Stassen, Jesse Harris) for securing the legal mandate on behalf of the official committee of unsecured creditors in the FreshRealm Inc. chapter 11 bankruptcy cases.
IslandDundon LLC (Tabish Rizvi) for securing the financial advisory mandate on behalf of the official committee of unsecured creditors in the BRD Land & Investment chapter 11 bankruptcy cases.