Retail segment growth was driven by increased visitation and spend per visit, resulting in the largest quarterly theoretical revenue increase in three years.
Management attributed retail strength to stable employment and higher year-over-year tax refunds, which offset headwinds from elevated gas prices.
The Interactive segment underwent a strategic realignment to prioritize U.S. iCasino states and the Canadian market over lower-margin, OSB-only U.S. territories.
Interactive marketing spend was reduced by over 65% through disciplined customer acquisition, a focus on high-worth user retention post-rebrand, and the inclusion of shifts in ESPN spending.
Performance in Ontario remains a primary growth engine, with theScore Bet brand demonstrating strong momentum in monthly active users and revenue.
Retail margins benefited from a one-time $5 million favorable legal accrual adjustment, primarily impacting the South region results.
The July 13 launch of regulated iCasino and sports betting in Alberta is expected to result in a $20 million loss for 2026, representing the only deviation from previous breakeven guidance.
Management expects the Interactive segment to achieve overall profitability in the fourth quarter of 2026 and targets overall profitability for the business as it heads into 2027.
Four major retail development projects are projected to generate 15% plus cash-on-cash returns on an aggregate $800 million investment.
The company expects to delever by at least two full turns of traditional net leverage by year-end 2026, supported by optimized CapEx and strong free cash flow.
Project CapEx for 2026 was reduced from $225 million to $200 million due to a timing shift for the Council Bluffs relocation project into 2027.
A two-week operational shutdown of the legacy Aurora riverboat in June is expected to cause temporary disruption prior to the new casino opening.
Management flagged potential legislative risks in Maine, stating they may cease investment if current iGaming proposals are implemented as written.
The company issued $600 million in unsecured notes at 6.75% to repay revolver borrowings and strengthen the balance sheet ahead of 2027 growth phases.
Ongoing geopolitical uncertainty and fluctuating gas prices are noted as persistent macro risks, though current April trends remain stable.
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