Full House Resorts (FLL) intends on “redefining the sport of horse racing” with plans to introduce a “moving grandstand”; stadium seating on rails that will move with the horses during races. CEO Daniel Lee points out that today’s racetracks only offer fans the ability to witness “two brief moments of a race – its start and the closing seconds at the finish line”, but a grandstand that moves with the horses would allow spectators to catch “every dramatic second.” The track (and moving grandstand) were announced as part of a proposed $200 million destination resort in New Mexico (La Posada de Liano) that would also include a 35K SF casino, luxury hotel, golf course and water park.
Howie Long-Short: FLL is a boutique casino operator with properties in Colorado, Indiana, Mississippi and Nevada.
While the concept of a “moving grandstand” is phenomenal, this project is far becoming a reality. For starters, the New Mexico Racing Commission has yet to issue FLL the state’s 6th racing license (there’s an open tender) and the State of New Mexico has yet to put forth legislation that would legalize gambling within the state (so talk of a casino is premature). In a best-case scenario, this project gets completed by the end of 2020; but, I wouldn’t put my money on it.
Back on August 1st, FLL reported Q2 earnings. Revenue rose +3% YoY (to $41.2 million) and adjusted earnings climbed +20% YoY (to $4.4 million). The Silver Slipper Casino ($17.4 million) and Rising Star Casino ($12.5 million) were Full House’s best performing assets. Shares rose 3% on Thursday, closing at $3.03.
Fan Marino: Lee’s right, the in-stadium experience for watching a race is terrible and in theory this is a brilliant solution, but I’m not sure it’s a wise investment. Secretariat hit 49 MPH while running away at Belmont in 1973 and earlier this decade, it was reported that the average age of people in the grandstand was 51. I can’t imagine race fans settling into retirement are looking for the thrill that sitting in an exposed monorail car, going 40+ MPH, offers.
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