Full House Resorts, Inc. (NASDAQ:FLL) Q4 2025 Earnings Call Transcript

Full House Resorts, Inc. (NASDAQ:FLL) Q4 2025 Earnings Call Transcript March 5, 2026

Full House Resorts, Inc. misses on earnings expectations. Reported EPS is $-0.34 EPS, expectations were $-0.23477.

Operator: Greetings, and welcome to the Full House Resorts Fourth Quarter and Full Year 2025 Earnings Call. [Operator Instructions] It is now my pleasure to introduce your host, Adam Campbell. Thank you. You may begin.

Adam Campbell: Thank you, and good afternoon, everyone. Welcome to our fourth quarter earnings call. As always, before we begin, we remind you that today’s conference call may contain forward-looking statements that we’re making under the safe harbor provision of federal security laws. I would also like to remind you that the company’s actual results could differ materially from the anticipated results in these forward-looking statements. Please see today’s press release under the caption forward-looking statements for the discussion of risks that may affect our results. Also, we may reference — we may make reference to non-GAAP measures such as adjusted EBITDA. For a reconciliation of those measures, please see our website as well as previous press releases that we issued. Lastly, we are also broadcasting this conference at fullhouseresorts.com, where you can find today’s earnings release as well as our SEC filings. And with that said, we’re ready to go Lewis.

Lewis Fanger: Well, good afternoon, everyone. It was a very good fourth quarter, but the comparisons versus last year aren’t very straightforward. So we’ll take you through those really quick. Revenues rose to $75.4 million, up from $73 million in the fourth quarter of 2024. Keep in mind that the fourth quarter of 2024 included $1.5 million of revenue from Stockman’s, which was sold in April of 2025. So revenue growth on an apples-to-apples basis was 5.6%. Adjusted EBITDA in the fourth quarter of 2025 rose to $10.7 million. Adjusted EBITDA for the fourth quarter of 2024 was $10.4 million. That included quite a bit of noise, including the benefit of a $1.2 million recovery settlement and the reversal of about $0.5 million of accruals at corporate.

Those 2 figures increased the fourth quarter of 2024’s adjusted EBITDA by $1.7 million. Backing those 2 items out of the prior year’s fourth quarter, the increase was about 23%. At American Place, our temporary casino continues to show significant growth. Revenues increased by 11% to $32 million in the fourth quarter of 2025. Adjusted property EBITDA rose 29% to $8.7 million. For the full year, revenues and adjusted property EBITDA rose to $124 million and $34.3 million, increases of 13% and 17%, respectively. Interestingly, the pace of growth actually increased as the year progressed. We fully expect adjusted property EBITDA at American Place to continue to climb in 2026 and the year is off to a good start. We have long said that the temporary American Place facility on its own should eventually be able to achieve about $50 million of run rate EBITDA and that it’s much larger permanent facility should be able to earn double that amount or about $100 million.

We continue to believe that our market remains under-penetrated. Some quick facts. Our permanent casino will not only be nicer, but in terms of square footage, it will be about twice the size of our temporary. We are the closest casino to more than 1 million people. We are located in one of the wealthiest counties in the entire country. Our closest casino competitor is 45 minutes to the south and they make $0.5 billion a year in gaming revenue. Our second-closest casino competitor is about an hour to the north, and they make more than $400 million a year in gaming revenue. And we’re sandwiched not just midway between those 2 very successful casinos, but also between 2 of the major north-south traffic arteries in Northern Chicagoland. Those facts, combined with our 3 years of operating experience in the market are what gives us so much conviction in what we think American Place can achieve in the long term.

Turning to Chamonix. For the first time in recent memory, we have a fully formed management team. That began with a new General Manager in March of 2025, new Directors of Marketing and Group Sales in July and August of 2025, the promotion of a talented pastry chef to lead the food and beverage department in January of 2026, a new Finance Director last month and a new Assistant General Manager this week. Here’s an interesting stat to look at. If you look at just the second half of 2025 under the new management team and compare it to the second half of 2024, revenues increased by $1.2 million or about 5%. Adjusted property EBITDA in those 6 months jumped by $4.2 million. The new team is making great strides and we believe our Colorado operations will be a significant positive contributor to adjusted EBITDA in 2026.

Specifically for the fourth quarter of 2025, we had a small, adjusted property EBITDA loss in the seasonally weaker winter season, but that was a significant improvement versus the much larger loss in the fourth quarter of 2024. After several quarters focusing on the cost side, the new team has redoubled its marketing and awareness efforts. If you look at any of our marketing collateral, it has been completely reenergized after transitioning to a new marketing agency during the fourth quarter of 2025. In January and February of 2026, we had a modest amount of construction disruption as we replaced the carpet and installed new ceilings in Bronco Billy’s. The incremental spend was extremely modest in the low 6 figures, but the result was outsized.

It used to be quite jarring to walk from Chamonix into the Bronco Billy’s Casino. Today, while Chamonix is certainly more elevated, the 2 casinos now complement each other quite nicely. We also just opened our Mexican restaurant at Bronco Billy’s with an inspired new menu as we prepare to head into the busy summer season. Looking at our database, we’ve been especially focused on driving loyalty and growth in the top 2 segments of our database. For the first 2 months of 2026, our top segment has seen unique guest counts increase by almost 20% and the total number of visits from that segment is up 36%. For the segment under that, unique guests are up 12%, and total visits are up 24%. Awareness is expanding and loyalty is expanding, which both bode well in our efforts to continue growing revenue and improve profitability.

Regarding our group business at Chamonix, that continues to pick up steam. At this point, we have a couple of thousand room nights on the books, with a couple of thousand more that are close to commitment or with decent prospects. As we mentioned last quarter, our ideal group size is between 100 and 150 attendees. Within 500 miles of us, we estimate that there are up to 4,000 conferences that fit that profile. Groups of this size tend to book years ahead of time. When we have a fully ramped group business in a couple of years, we think it will consist of about 55 events per year or about 1 per week. That is the key to improving our midweek occupancy. Among our smaller properties, Silver Slipper and Rising Star declined slightly for the quarter.

Similar to Chamonix, we’ve upgraded most of the management team at Silver Slipper, and they are gearing up for growth in 2026. Grand Lodge, which is a pretty small part of the company at this point, continues to be adversely affected by renovation disruption at the Hyatt Lake Tahoe that houses our casino. The Hyatt Resort will be beautiful when that renovation is complete. But in the meantime, we’re trying to manage through the disruption. That includes proactive efforts to find new casino guests in advance of completion of the renovated amenities in 2027. On the balance sheet side, we had about $51 million of liquidity at the end of the quarter, including the undrawn portion of our revolver and we’re about to enter that part of the year where we generate meaningful cash flow.

We amended our revolving credit facility a few days ago. That was a simple amendment to extend the maturity date of our revolver to August 15, 2027. And we’ve said this several times, but our Illinois operations alone pay for the interest expense on our current debt. And of course, Illinois continues to ramp, as does Colorado. Lastly, an update on our continuing progress for our permanent American Place Casino. In real time, our architects are putting the finishing touches on our foundation drawings. Those drawings should be done imminently. With those drawings in hand, we’ll be able to officially break ground on the casino’s foundations. We expect that to occur sometime in the coming weeks. The foundation work does not take a lot of money, but it does take several months to complete.

By getting it done now, we can accelerate our time line to construct the permanent facility. Meanwhile, we are making good progress with respect to the financing of the American Place facility. We have received several proposals for the construction of the permanent facility at attractive rates, including proposals that fully fund its construction without the issuance of equity. We’re not quite able to provide details just yet, but we hope to do so in the next several weeks. As we have noted previously, we are currently allowed to operate our temporary casino until August of 2027. In conjunction with our anticipated financing, a bill was recently introduced into the Illinois legislature to extend that operations stay by 18 months. Typically, items in the legislature don’t get voted on until the end of the session, so we expect it to pass in April or May.

Passage of the bill will allow us to transition smoothly from the temporary casino in [ 18 to 20 months ]. Bally’s has a similar bill in front of the legislature for the same reason. I covered a lot there, Dan. What did I forget?

Daniel Lee: I don’t know. I think you got it all. And we’ll get to questions. So if we forgot something, it will almost certainly come out in the questions.

Lewis Fanger: Very true.

Q&A Session

Operator: [Operator Instructions] Our first question comes from the line of Ryan Sigdahl with Craig-Hallum Capital Group.

Ryan Sigdahl: I want to start with Chamonix, though, for the first question. So appreciate the improvement kind of on a full year basis, especially on the cost side. If I look at revenue, 19% growth in the first half of the year. Year-over-year, 7%. In Q3, 2%. In Q4, flipped to a loss. I get the seasonal aspect of that. But I guess, just walk through, I guess, what’s going on there specifically just given kind of a decel from a trend standpoint and considering it’s still very subscale or early stage in its maturity?

Daniel Lee: Ryan, if you recall, last year, when we reported the third quarter, we pretty bluntly said we had run some marketing programs in I think it was principally September of 2024, which were non-economical. In other words, we induced people to come down, gave them free rooms and they didn’t gamble, and it actually cost us at the bottom line quite a bit. But it did puff up the top line. Then in the fourth quarter, we had a big grand opening party, and it was a very expensive party to have, we had Jay Leno, et cetera, et cetera. And remember, looking around and realizing that the people who were there were the same people we’d always had when it was a golden opportunity to try to get new customers and people down from Denver and so on.

And it was about that time, I realized that we had the wrong management team, and we had to make a bunch of changes. And we have now. But the prior year numbers were kind of artificially inflated by inefficient marketing in those 2 quarters. And — but now we have a new advertising agency, we have a Chief Marketing Officer here. We have new marketing people at the property. They’ve been getting organized and all that stuff is coming into play now, and Lewis gave you some of those numbers. And so I think you’ll see revenue growth pick up going forward. But the reason it looks like such a small year-over-year growth was the promotional stuff we did last year that kind of boosted revenue but not income.

Ryan Sigdahl: Quick follow-up on that, and then I do have another question. Have you seen any re-acceleration thus far in Q1 of ’26?

Daniel Lee: We have with the caveat that it was pretty torn up back in January. We renovated the west part of Bronco Billy’s and putting down the carpet and ceilings. And frankly, I was surprised it didn’t have more disruption than it did because we are showing better revenue numbers. I think if we hadn’t had that disruption, we’d be doing even better than that. I mean at the end of the day, this is one of those where you open it, it’s not performing as well as you thought it would. And you start looking at it and saying, first, did we make a mistake? And I’ve gone back several times now and gone through the numbers again of how many people live in Colorado Springs, Denver and competition and everything else, and I’m absolutely convinced we did not make a mistake.

And in fact, I can underline that by the fact that Monarch’s EBDIT (sic) [ EBITDA ] for the year was $199 million. Now they only have 2 casinos. They don’t break out the one from the other. But the smaller one, which is in Reno made $40 million to $50 million a year for a long time before they opened in Black Hawk. And so Black Hawk has only been around 3 years, I think, in their portfolio. So they must be making significantly north of $100 million a year in Black Hawk. And it’s a good property and frankly, a well-managed company, and they opened far more smoothly than we did. And I look at it and say, well, they’re there with 500 rooms, we are equivalent in quality, we have 300 rooms. There are aspects of ours that are nicer than theirs. Now they are an hour from Denver, we’re an hour from Colorado Springs, but from Southern Denver, we’re about equal distance.

But they also have significant competitors there. I mean they not only make a lot of money, but so does Ameristar, the Horseshoe and the Lodge and then there’s a bunch of smaller ones. There’s a lot less competition in Cripple Creek and the competitors are not anywhere near as good as the quality of ours. So I think we are in the right place. I think we’ve built the right product. I think fixing up Bronco Billy’s makes it quite a bit nice. So we didn’t spend a whole lot of money, but it really made a pretty big difference, just changing the carpet and drop — putting in a drop ceiling. And now we have the right management team all put together, and there’s a lot of blocking and tackling that we need to do. I mean there’s simple stuff like the housekeeping department there cleans 9 rooms a day.

At our other properties, they clean 14 rooms a day. 9 rooms a day is pretty ridiculous. We have a new Assistant GM, who has a strong background in hospitality, and that’s one of the first tasks, he’ll try to figure out. And we do it through an outside company and we probably need to adjust that. And that factors in all the way down because if you’re only cleaning 9 rooms a day, the cost to turn a room is like $50 or $60 when it should be $30 or $35. In other words, the cost of renting a room that would otherwise sit empty, when I say the cost of turning a room. So that factors into who you’re willing to comp a room for. And if we can get the cost of turning the room down, then we could be a little more generous with who we comp rooms for. And so there’s a lot of blocking and tackling, which we are doing.

We had a Mexican restaurant, for example, that had terrible food, to be honest. And it’s been closed for about 6 months. We promoted a very talented chef to be the food and beverage manager, and it was kind of funny to persuade him to take the job because he was hesitant. He came back and said, I really want to promote some people and then get rid of some deadwood. And I said, well, that’s exactly why I want you to take the job. I too want to promote good people and get rid of deadwood. And so he stepped up and the quality of the food in the reopened Mexican restaurant is 10x what it used to be. And it was just last weekend it opened. And that’s important going into the summer. So there’s a lot of little blocking and tackling that we are doing at that property.

And if you get into the minutia, just about every parameter is trending the right way. No, I wish it were trending faster, but at least it’s going the right way. And I’m convinced it will eventually be a very significant profit generator for us. And even this year, it will be significant, but significant like 10% to 15%, and it might be significantly above that next year and then the year after. I mean we built the rate property. We’re there for the long haul. And it’s a little more — it’s a different marketing task than we have at American Place. At American Place, we are in the middle of 1 million people, they drive by us all the time, but we’re in a strong structure. And so it looks like where the Department of Motor Vehicle store salt for the winter.

I mean it has absolutely no curb appeal, but a lot of people driving by. And if you go up to Colorado Springs, we have fantastic curb appeal. The building looks fantastic, but nobody is just driving by. So we have to persuade people from Colorado Springs to drive up there. It’s just under an hour, but to come up and see it. And once they do come up and see it, we get very good repeat visitation and that’s how you build the business, but it doesn’t happen overnight.

Lewis Fanger: Yes. I mean the most promising thing that we’re seeing behind the scenes is that those upper segments, which this property was built for. And when I say upper segments, I don’t mean someone that’s gambling $10,000 a day. I’m talking about someone that might go in and gamble a couple of hundred dollars a day. That is a very ripe customer that’s an abundance that is our biggest group. It’s a customer that’s finding the building now for the first time. And as I kind of hinted at, or said actually, didn’t hint that, in my opening comments, that group is where we’re seeing significant growth in loyalty.

Daniel Lee: In my experience, I remember Beau Rivage in Mississippi opened slowly. They went through the same sort of things. And then eventually, it found its stride, and it’s led Mississippi now for 20 years. Similar in Las Vegas, Luxor opened slowly and then found its stride, and it’s been very successful for a long time now and so on. And thinking back, there’s things we should have been smarter about. We should have hired a sales [Technical Difficulty] while we were under construction. We didn’t. But we’re fixing those things now. So…

Ryan Sigdahl: Well worth the visit, I can personally attest to that. For my second question, and maybe I’ll try and ask this in a shorter way. Indiana bill, it originally included a fair value payment to you guys if you were not the winning bid for relocation. Now it appears like it’s just a new license that you can apply for. Just give us an update there on the future of Rising Sun? If you guys are interested kind of under the current structure.

Daniel Lee: Listen, this is a long process and a rapidly evolving one. I mean that bill get changed many times in the last week that it was in the legislature. We’ll continue to watch it and see. We make money in Rising Sun. We always have, not a lot of money, but we make money. We’re the ones who said to the state, we think we — the state would be much better off if it relocated to an urban center. When they legalized casinos along the Ohio River, you didn’t have casinos in Ohio and Kentucky and you do now. And so the original locations where they legalized were the wrong locations, and the independent study that the legislature called for that was done underneath the Gaming Commission said exactly that, that there would be significantly higher revenues to the state with the casino in Indianapolis and in Fort Wayne.

Now they chose to widen it out. It’s not just Fort Wayne. It’s 3 different counties. They’re all going to have a referendum in November. I think it’s going to be a challenging referendum because the way they did it, there’s 3 different counties that are going to have a referendum. And let’s say, all 3 pass it then the Gaming Commission is supposed to choose from the 3 and then run a process to figure out a development. So you actually have like it would be problematic for us or anyone else to try to fund the pro side of any county. And yet there’s very clearly well-funded opposition. Just look at the website, savefw.com. It’s clearly well-funded by somebody. And I’m guessing it’s an Indian tribe in Southern Michigan or something along those lines, somebody who might be hurt by this.

So you’re going to have 3 referendums where the opposition is probably well funded. And the pro side probably isn’t. And so will it pass or not? I don’t know. I think normally, these things do pass because it produces jobs and tax revenues and so on. But the way the legislature has set this up, and I think it’s inadvertent, but I think the way they’ve set it up, those are going to be very challenging referendums. And we will watch the process and see what happens. And legislature meets again next year. We know where it meets. Meanwhile, we continue to make money in Rising Sun. And we will continue to do that are good for our shareholders as well as good for the state. And that’s about it.

Operator: Our next question comes from the line of David Bain with Texas Capital Bank.

David Bain: Great. First, congratulations on the progress on the American Place financing. I understand you’re not giving a ton of detail, but one, I think you reiterated no equity will be sold. And I’m sure you looked at multiple options from whatever asset sales to high yield to REITs as the financing environment involved. If you could help us process that, balancing your thoughts as you went through that process, that could be very helpful for us. And then does that financing come in tandem or include the refinancing or extension of the existing debt?

Daniel Lee: David, as I’m sure you’ll appreciate, when you’re going through one of these processes, you reach out for a lot of people and you find people who are most interested in working with us. And then there’s a point where you say, okay, fine, we want you to invest in the due diligence to start working on the legal documents and we will keep it confidential. And I would argue that’s about where we are. And until we have a real deal to announce, I really can’t go into any of the details, but we are pretty comfortable that we are going to have a deal that will allow us to be open there in 2 years. And we’ve always said that we’re not going to issue equity at anywhere close to these prices, and we’re confident that we could get there. But anything further than that, I can’t tell you yet. I wish I could, David. Obviously, it’s an all-encompassing. I mean it’s — it does involve refinancing the existing bonds.

Lewis Fanger: Yes. We’re looking at an all-encompassing solution. And I think the only thing to add to what Dan said is, again, not only no equity, but also, we view the financing cost is attractive as well. So we’re excited to give you more details. I guess I wish we could. Just can’t quite yet.

Daniel Lee: Attractive. I think, I would say, acceptable. Attractive would be 5%. We’re not 5%, right? But it’s also not 15%. And I think it’s acceptable. And just on refinancing the existing bonds, they mature in February ’28. They become a current liability on February ’27. So you pretty much have to refinance them. I think anybody would look at it and say, of course, you have to do that. And so — but we’re — we’ve had some really good proposals and we’ve kind of zeroed in on one formula that we think works and we’re trying to nail that down.

David Bain: And then I guess my other question, I got to keep you here. I guess I would go with the Chamonix. You gave some encouraging data points on penetration. I think the last call, you mentioned 15% of Colorado Springs visits Colorado — Cripple Creek once a year, something you intended to tackle. It sounds like the biggest feeder lever. If you could speak to some of the progress specific to the penetration of that market? I know you have a marketing group, but anything, whether it be buses or new forms of advertising and anything that we can look for in terms of impact that’s been fruitful so far would be helpful.

Daniel Lee: Yes. Well, you mentioned buses. We’ve looked at buses. We’ve looked at working with the one company that’s in Cripple Creek. We’ve looked at working with other bus companies. We’ve even looked at buying our own buses. But at the end of the day, that’s not one of the bigger levers. Most people drive themselves, and that’s true even in the markets like Atlantic City that traditionally has had a lot of busing, the bus customers still drive themselves. And so — but there’s — it’s a very complicated algorithm because at the same time, we’re trying to figure out how to attack these different markets. The whole world of advertising is changing, right? And so like far more people watch TV shows now through YouTube than on the networks.

And ultimately, that’s good because we can target it. Like we don’t have to be buying ads for all of the Denver metropolitan area. We can target those who live on the south side, which is closer to us. We’re much less likely to get somebody from Fort Collins because they’re quite a bit closer to Black Hawk than to us. But Castle Rock is pretty much equal distance. And so it’s about targeting the people in Castle Rock. And then if you can go further and target those people who might have a proclivity to gamble, and so we’re getting — we’ve hired a bunch of good people who have experience in this and a new advertising agency that is experienced in this to try to make our dollars be most efficient in different markets. Now in Colorado Springs, you can be in more general advertising, right, because anybody in Colorado Springs is a potential customer.

And whereas in Denver, if you bought a Denver-wide ad, probably the people who live on the north side of Denver, half the people whose eyeballs you’re paying for are less — not likely to come to us. Whereas in Colorado Springs, everybody is a potential customer. So there’s a lot of that parsing and trying to understand it. And even like trying to reduce direct mail we send and trying to do more e-mails, because it’s so much more cost effective. Like we don’t send any direct mail anymore out of American Place, and we want to get to that point in Chamonix. And so David, honestly, I’ve got a chief marketing guy who could spend all afternoon answering this question for you. But I guess from our point of view, it’s like we’ve hired people who we think are very confident in this area, and they are working on it full time, and we’re seeing some results, and we’re confident we’re going to get there.

Lewis Fanger: Yes. I mean, look, the penetration in the Colorado Springs is creeping up. The percentage coming out of Denver is still an extremely high number. And ultimately, I think those are — that’s a good setup because I think as more and more people that are closer to us experience our brand, we’re finding out they’re enjoying it. And — but to have the reach as far as Denver was never in the original model. It was always viewed as overflow. And so to the extent that, that number continues to flourish, it’s all to the better as well. So we’re set up well.

Daniel Lee: And there’s some other little blocking and tackling, like Cripple Creek is in the middle of some of the best fly-fishing in the world. I mean there’s fantastic fly-fishing around it. And there’s fly-fishing guides, fly-fishing camps and everything. So it’s like, okay, we need to have a high roller weekend where everybody gets to go fly-fishing, and we have a fly-fishing tournament and people will gamble in the evening. And in the same way the hotels in Las Vegas have golf tournaments. The fly-fishing around Las Vegas isn’t so good. So you have golf tournaments, right? And there’s no golf, of course, in Cripple Creek, so we can have fly-fishing tournaments, right? And so there’s a lot of stuff like that, that we’re looking at.

And frankly, for a fly-fishing tournament in, say, July, we can get gamblers to fly in from Texas for that. I mean there are nonstop flights from Dallas and Houston into Colorado Springs. It’s a pretty easy trip actually. And so for the right high roller, now we have to find the high roller in Dallas who likes to fly-fish. But there are ways to find those people.

Operator: Our next question comes from the line of Jordan Bender with Citizens.

Jordan Bender: I think you kind of characterized Chamonix as — the investment thesis there was to focus more on the higher end customer, the luxury customer. Is there a point maybe this year where if you’re not starting to see the revenue start to tick up, that you could start to shift some of your focus into that middle or lower end given that the cost structure is fully baked?

Lewis Fanger: And apologies. My — I didn’t mean for you to think that we’re not focused on the other tiers. We certainly are. I’m looking at my list for January and February, and I’ll tell you, we had meaningful growth across every segment. The most growth is in that top tier, but down the line, we’re seeing pretty meaningful growth. If you think of the product that we have, it’s certainly — if you bring an upper tier customer into town, they are extremely likely to go to us and only us. If you bring in a lower tier customer, you have the potential and likelihood of sharing that customer around another place or 2. So all things to keep in mind. But ultimately, we’ve got half of the room product in town. And so long as we see people adding to the bottom line, we will market to them.

What naturally happens in these processes is kind of year 1, year 2, you focus on getting customers in general and finding customers that are additive to the bottom line. And fast forward a year after that, then you start cycling and you say, all right, this customer used to get a Friday, free Friday room. Now he does not. Now we’ve got more customers in the database. We know what people spend. That person doesn’t want a Friday room, but they might get a Wednesday room. And so — and then a year after that, you continue to cycle that database and just optimize it. So we’re early in the optimization process, and we’re kind of taking people up and down the line.

Jordan Bender: And then just switching to Silver Slipper. It’s a property that, I guess, we don’t really talk about all that much on these calls anymore. But just curious how you view maybe the ’26 outlook there? And then just in general, how does that property maybe fit into the overall portfolio as we move forward?

Daniel Lee: Year-over-year, the EBDIT (sic) [ EBITDA ] there was about — it was off a little bit, almost flat. And it was — in ’24, it’s a bit above 12%, and then ’25, it was a bit below 12%. It should be in the high teens. I mean if you look at the margins, it did $70 million of revenue, and if you take $70 million and apply a normal regional gaming margin, you’d be in the high teens, maybe even in the low 20s. And so we’ve made quite a few management changes there as well, including a new GM and a new food and beverage manager, a new table games manager, a new HR Director, new Finance Director and whereas it had the same management team since it opened 15 years ago. And so we’ve made a lot of changes in the past year. And the intent is to get it up to the sort of income it should be having.

Now we’re not ignoring revenue either, but this is a pretty saturated market. The people in this part of the country gamble more per capita than most areas, and it’s not a particularly wealthy region. So I think the upside will be being more efficient on stuff, and we’ll get some revenue upside as well. It’s a good property. It’s kind of a cash cow for us, but it’s a cash cow that should make a little more money than it’s making. And I think we’ll get there in 2026.

Lewis Fanger: Not to the high teens in 2026, but I think…

Daniel Lee: I’d be disappointed if we don’t get to 15%, but — that’s not 19%, but 19% is not out of the question. When you look at what you should be bringing to the bottom line with $70 million of revenue and in a state where the gaming taxes aren’t particularly high. And we’re on the same page.

Operator: Our next question comes from the line of Chad Beynon with Macquarie Asset Management.

Chad Beynon: Wanted to ask about your Sports Wagering business supporting over around $7 million of EBITDA this year. I guess talking about a cash cow, that’s certainly a good one with pretty high margins there. Can you talk about how that contract looks, if there’s any risk to that in ’26 or if we should continue to assume the same amount for the year?

Daniel Lee: Most of that is with Circa in Illinois, and I think they’re pretty happy with what they have. They also operate the sportsbook in the temporary casino and well in the permanent. Illinois has a big population and a limited number of licenses. So that’s by far the most valuable license we have. Now we have other licenses that are available. And one of them was markets who paid us upfront for several years. So there’s an amortization of deferred revenue which is why you get a little bigger than $5 million. We did do a little change that got approved by the Gaming Commission last week. We’ve had a sportsbook in the Grand Lodge Casino up at Tahoe for many years. And it was pretty small and the guys were — it was leased to an outside operator.

And the guys who were running it never really did much, right? And it was pretty insignificant for us. And there’s a new start-up company that came to us and said, hey, we’d like to take that over and put some money in and try to make it something meaningful. And it’s not material to the whole company, but they’re paying us significantly more rent than we were getting. And perhaps more importantly, they’re paying attention to it better. So it’s one of those — not material to the company as a whole, but I think it’s a step in the right direction of changing that to a different operator. We tend not to operate these ourselves because we’re not diverse enough to spread the risk. In other words, I think we have a sportsbook at the Silver Slipper, if the Saints get into the Super Bowl, our customers are all going to be betting on the Saints and we won’t have bets on the other side.

And so it’s better to leave it to somebody who’s in that business, and we tend to just get license fees for it.

Lewis Fanger: If you’re thinking about what the number should be on an ongoing basis because there’s always — there has been a lot of noise in that line over the last year or 2. The right number for EBITDA is roughly 6 — it’s like $5.9 million if you’re assuming the minimums on the existing contracts.

Daniel Lee: No, there’s always risk. I mean if Circa decides to cancel and leave the business, there’s some limitations in the contract on their ability to do that. But it’s not like a treasury bond, I mean it could happen.

Lewis Fanger: Yes. I will say, though, Circa is — more than most companies, Circa has sports in their DNA. They love that sportsbook in Illinois, you’ll see that they really — I mean look, I’m looking at Adam as I say this. I think there’s still the patch on the Chicago hockey team, the Blackhawks. And so they continue to fully embrace the sports side. I’d be surprised if there are any changes anytime soon there.

Daniel Lee: And frankly, the permanent casino has a sportsbook that’s kind of modeled after the one at Durango Station, and that should be good for both us and Circa.

Chad Beynon: And then Lewis, yes, looking forward to some of the financing details, hopefully in the next couple — in the next several weeks. You talked about an 18- to 24-month construction period for the permanent. If that deal is executed and you do decide to kind of push forward on some of the heavier lifting, heavier spending parts of the project, I mean, will there be a meaningful amount of CapEx in ’26? Maybe some of that comes in the fourth quarter? Or is it safe to assume that a lot of the permanent spending, kind of the real outflows will come in ’27? Just any parameters around that would be helpful.

Daniel Lee: Most of it’s ’27.

Lewis Fanger: ’27, yes.

Daniel Lee: I mean some may even spill into ’28. Some of the construction payments are made in arrears, for example.

Lewis Fanger: A big portion will be made in arrears, yes.

Daniel Lee: But how much is — falls in this year depends a lot on exactly when we get going. The foundation isn’t a big number, but it does take time. So you literally have a guy moving a bulldozer around and then they dig trenches and pour some concrete, which is the foundations for the building that will go up. If you had the pause after doing that, like let’s say, the debt markets just weren’t cooperating and we had to pause for several months, it’s okay. The concrete doesn’t go bad. It’s still there, right? And you can come back and finish. Now hopefully, we don’t have to. Hopefully, we have the financing arranged. And so by the time we’re done with the foundations, we can move into the other stuff. But you don’t really want to go into the heavier spending until you know you have the money to finish it.

And so we’re willing to start on the foundation so that we can speed up the opening date and that we can fund with our existing resources, while we try to nail down the financing.

Lewis Fanger: I will say that we talk about — Dan and I talked about this at lunch day. We talk about an 18- to 24-month build. But one thing to keep in mind is the build itself is on the simpler side. In terms of — there’s nothing subterranean, there’s no parking garages. It’s kind of a basic — no high-rise exactly. It’s a basic 2-story building. And it’s the basic rectangular building. On the inside, the fit-out is quite fanciful, but in terms of getting that actual structure up and close and then starting work on the inside, it’s relatively — it’s one of the easier pads that we’ve seen in our lifetimes. And so…

Daniel Lee: Actually, only a small part of it is 2-story. Most of it’s 1-story.

Lewis Fanger: Exactly right. So we talk about 18 to 24 months, but it’s — we’ll keep you in the loop, but we feel good — it is an easier project to build as maybe the right thing to say.

Daniel Lee: We’ll go as fast as we can, but we don’t want to incur a lot of overtime.

Operator: Our next question comes from the line of John DeCree with CBRE.

John DeCree: Just one from me on Waukegan. I think if I’m not mistaken, just kind of hit the 3-year anniversary couple of weeks ago and 11% growth in the fourth quarter, so still growing double digits. I know you talked a little bit about it in your prepared remarks, but I don’t know, Lewis or Dan, if you could give us a little bit more insight as to kind of what’s driving the growth there? Is it bigger database? Are you still growing the database? Or is it more spend per the existing database? I’m guessing that double-digit growth, it’s probably a little bit of both. But 3 years in still growing double digits is pretty great. So if you could give us a little more color on what’s going on there, that would be helpful.

Daniel Lee: Well, actually, I want to give credit to the team we have there. I mean where we kind of stubbed our toe in Colorado and had to put together a new team. We had a great team from day 1 in Illinois and that they’ve just every month, every quarter, figured out a way to increase our penetration, increase our — not only our number of customers, but the satisfaction levels of the customers. We have the only casino in the whole region that made the list of the Chicago Tribune’s best employers. I mean they list, I think, 50 employers and who are the best employers in the region, there’s 50 of them. And 2 years in a row now, we’ve been the only casino on that list. And that trades into very low turnover, which helps. I mean — and so the team has done a very good job and every month, they’re trying to figure out, okay, how do we do better?

How do we do better? And had we had an equivalent team in Colorado, we would be much better in Colorado. And people matter. And we’ve had a great team in Illinois. And now we also have the right demographics. I mean we’re the closest casino to 1 million people. We are easy to see. While the outside of the building looks like Department of Motor Vehicles storage place, once you’re inside, it feels like a real casino. And even though we did it without spending a lot of money, when you go in, people are like, wow, we didn’t expect this. It’s wonderful. And so I think we have the right product and the right market. Year, I mean, it was very fast, but equally important, we had the right team, and they’ve done a great job.

Lewis Fanger: And I think to answer to, it’s a little bit of both, John. It’s — the database in terms of adding new names to it, it continues to grow at a pace meaningfully similar to what it was 3, 6, 9 months ago. It really hasn’t slowed down in terms of the number of people that go into that database. We’ve crossed 121,000 names or closing in on 125,000 names in the database and not showing signs of slowing down. So — but it’s a little of both.

Daniel Lee: And we’ve done it without hurting the competition. I mean most of it is increased gambling by people in Lake County, which is what we expected. And I guess I should also give a tip of the hat to Alex who forecasted that this is exactly what would happen, and he’s been right.

Operator: Thank you. We have reached the end of the question-and-answer session. I would like to turn the floor back over to President and Chief Financial Officer, Lewis Fanger, for closing remarks.

Lewis Fanger: I’ll turn it over to Dan. Any last words?

Daniel Lee: No. Listen, it’s been kind of a challenging year fixing Colorado while we try to figure out how to finance the permanent American Place. But I think we now have the team in place, and this stuff is trending the right way in Colorado, and I think we’re on the cusp of having the financing arranged for American Place. So it doesn’t happen overnight. I mean I think the financing would be in place in May or June, which is approximately when we would also have the extension that we mentioned and the legislature. But hopefully, by the time we’re having this call for the next quarter, we have a lot more concrete stuff we can talk about. So thank you very much, everybody.

Operator: This concludes today’s conference, and you may disconnect your lines at this time. We thank you for your participation.